Traders are now pricing in a potential Fed rate hike because of recent strong data in the US and hawkish Fed messaging, per the FT. Does anyone remember 4Q23 when cuts were supposedly coming early in 2024? Well, Citi is taking the opposite side of that bet and is recommending folks buy the dip in equities, per BBG. State Street is on a similar track but recommending USTs after they declined before a 2-yr auction that may price to yield at least 5% for the first time since last year.
The co is not rotten but is certainly bruised-Apple’s as 1Q24 phone sales in China fell -19.1%, the worst performance since 2020. Rival Huawei’s was up +70%, per BBG and Reuters. If you think there isn’t some nationalism going on (here and there), these numbers should set the record straight. It happened during Lunar New Year, when the Chinese go out and spend a ton.
Earnings postmarket after 7 straight days of declines. Margins, robotaxis, price reductions, CEO comp. Lots that will get unpacked, so stay tuned.
That’s what the US is trying to create by drafting sanctions to cut off some Chinese banks for aiding Russia’s war effort, per the WSJ. Blinken is headed over this week, so expect more headlines. Imagine the banks…they’ve been down in the dumps, and now this.
We’re getting closer to levels when Japan will step in to prop up its currency. They just can’t take it any more (loose paraphrase of their higher ups).
A German rebound and an improved services sector helped the EZ’s composite PMI to hit its highest level in 11 mo. French data also beat. The numbers point to an expansion of +0.3% in the current quarter, per Hamburg Commercial Bank. But everyone’s banking on an EZ cut coming first, and that could be a risk if inflation strengthens. Even in the UK, the PMI showed its fastest output since May 2023 but inflation picked up too. You can’t have growth without it, so don’t get too far ahead of yourself (for a second time) betting on near-term rate cuts globally.
Yesterday I pitched commodities/materials on the Wall Street Beats Roundtable as a multi-year play. Now Carlyle’s Jeff Currie is saying commodities look like a “win-win” for investors as climbing prices reflect vigorous economic growth.
Lower-income borrowers in the US are having a hard time keeping up with loan payments, per Reuters. On a similar note, US student loan interest rates will hit 6.61%, their highest level since 2008, per BBG.
TikTok is prepping for legal battle against the US after the House passed its divest-or-ban bill, per the FT.
Companies are buying back their stock. They know their numbers…
When folks were pulling capital from various places, they were reinvesting in large caps.
It’s like a bowl of Lucky Charms, Frosted Flakes and Cap’n Crunch. This is where I jumble together other interesting reads. GOOG is telling employees to work faster. That’ll boost morale, I’m sure. JetBlue is down hard because of a lower rev outlook. Pepsi threaded the needle but sales are down because of the lower-income consumer, oil is below $81, Walmart introduced BNPL to increase its lending offerings (another way lower-income folks will get hurt, IMO), Russia is threatening more strikes if we give more aid to Ukraine, credit card balances increased 14.5% in 4Q23, and the average credit card rate is 20.71% according to BankRate. And I did not mistype that number.