Per UBS, the SPY’s forward P/E ratio is 18.9x. Profit forecasts for 2024 have slowly come down since Labor Day. So, any continued move up of US markets will be driven by multiple expansion, thus making equities even more expensive as an asset class.
OpenAI has its third new CEO in days, Emmit Shear (former CEO of Twitch), after the board kicked out Altman, who then joined MSFT with former Pres Brockman. MSFT stock is up on the news, written about in Axios, Bloomberg, FT. Michael Lewis is probably drinking more coffee, trying to figure out how to write 2 tech-related books at once (SBF and OAI).
Traders currently are pricing in a ~30% chance of a Fed rate cut in March after last week’s cool inflation. This week, investors are looking for tea leaves in Tues’ publication Fed minutes for further insight into policy makers’ thinking as well as Nov flash PMIs.
The USD is down to its lowest level since Aug. So, if you’re going to take an intl vacation and rely on a strong USD, do it soon. For investments, you can consider a stronger yen (FXY), emerging markets (EEM) or gold (OUNZ).
A friend commented that at a party over the weekend, it appeared that the vast majority of guests had Ozempic-face. Anyone else wondering what the first appetite-suppressing Thanksgiving will look like for food companies and tables around the country? Food manufacturers and retailers are wondering too. Weight loss was the talk of this past earnings season, per Reuters. Our guess is that if you want a second slice of dessert, it’ll be a piece of cake.
Analysts at RBC report that categories typically driving the holiday season (e.g., apparel and toys) are being replaced by everyday essentials (non-discretionary) and experiences (travel and entertainment). Per the WSJ, Black Friday deals are cheaper y/y, so if you’re looking for a TV, phone, sofa or toys—you’re in luck.
Traders are gearing up for a $16bn sale of 20-yr UST. The gov had to offer an unusually attractive deal to sell 30-yrs recently. Auctions can affect stocks because they reflect the path of interest rate expectations.
