MARKET WRAPS
Watch For:
ADP National Employment Report for November; Trade for October; Revised Productivity and Costs for 3Q; EIA Weekly Petroleum Status Report; Canada Trade for October; Bank of Canada Rate Decision
Today's Top Headlines/Must Reads:
- Nvidia's CEO Still Plans to Sell High-End Chips in China
- SEC Head Warns Against 'AI Washing,' the High-Tech Version of 'Greenwashing'
- Big Bank CEOs Warn Congress About Tougher Regulations
Opening Call:
Stock futures rose on Wednesday, a day after equities struggled even with more relief from bond yields.
There's more jobs data on tap in the form of the ADP private-sector employment report, though the report is not a reliable predictor of the jobs data produced from the government that is due on Friday.
Investors will also be listening to the testimony of top bank CEOs including JPMorgan Chase's Jamie Dimon, who will be in front of the Senate Banking Committee.
Bank of America CEO Brian Moynihan, at a Goldman Sachs conference on Tuesday, gave a warning to the Fed that the central bank will have to be wary about slowing the economy down too much.
Premarket Movers
Apple ended Tuesday with a value of more than $3 trillion for the first time since August. The stock ticked higher premarket.
British American Tobacco fell 8% after BAT said it expected to take a $31.5 billion impairment on its U.S. brands due to lackluster sales. Shares in U.S. rival Altria traded down ahead of the opening bell.
Nvidia's CEO said it was working with U.S. authorities to create new products that comply with regulations on exports to China, Reuters and other media outlets reported. Shares rose slightly.
Plug Power fell 4%. Its shares have been under pressure for months, along with other clean-energy stocks.
Tuesday's Post-Close Movers
IGM Biosciences said it would cut its workforce by 22% as part of a broader overhaul. The company is focusing resources on treatments for colorectal cancer and autoimmune diseases. Shares rose 2.5%.
MongoDB's revenue rose 30% in the third quarter and beat analysts' estimates, but slowed from the 40% rate seen in the second quarter. Shares fell 5.9%.
SentinelOne's revenue surged 42% in the fiscal third quarter as demand for cybersecurity products stayed strong. The company's adjusted earnings also topped analysts expectations. Shares rose 18%.
Forex:
The euro weakened and looked vulnerable to further falls against the dollar due to increasing expectations of interest-rate cuts by the ECB next year and the U.S.'s growing yield advantage over the eurozone, Helaba Research said.
The euro has fallen below its 21-day and 200-day moving averages and is coming very close to support at the 100-day moving average, which if broken could see the euro drop, it said.
"If prices fall below this level, a significant correction would have to be considered."
Bonds:
The case for the fixed income asset is the strongest it has been for years, Invescosaid.
The potential peak in interest rates is "offering the opportunity to lock in a higher level of income for the years to come," it added.
Heading into 2024, the market consensus is generally that interest rates have peaked, "which is exciting news for bond investors."
Energy:
Oil prices were slightly higher after closing at their lowest level since July as skepticism around OPEC+ cuts continued to weigh on sentiment.
Saudi Arabia cut its official selling prices for its flagship Arab Light crude to Asia and other regions despite extending voluntary output curbs as part of an OPEC+ deal.
In an interview with Bloomberg earlier this week, the Saudi energy minister said OPEC+ curbs would be delivered in full and that the group could extend the cuts further into 2024 if needed. Yet, "the news has had a muted response so far," according to ING.
Metals:
Metal prices were rising, as a weaker dollar helped support commodities backed by the greenback.
"The outlook for gold futures in coming months remains largely contingent on the U.S. dollar," Commonwealth Bank of Australia said.
"The dollar has weakened since the beginning of November as markets have looked to price in more Fed Fund rate cuts over 2024. However, there is likely a limit to dollar weakness being tied to Fed Fund rate cut expectations next year," CBA added.
TODAY'S TOP HEADLINES
Rio Tinto Plans $6.2 Billion Investment in Guinea Iron Ore Project
Rio Tinto's single biggest investment over the next few years is likely to be a huge African iron ore project that could reshape global supplies of the steelmaking ingredient.
The world's second-largest miner by market value said Wednesday it expects to contribute roughly $6.2 billion to the initial development of the Simandou mine, including port and rail infrastructure needed to export the ore.
Elon Musk's AI Startup Seeks to Raise $1 Billion
Elon Musk's artificial-intelligence company, xAI, is looking to raise $1 billion, according to a new SEC filing.
Musk launched xAI in July, with the company saying its mission is "to advance our collective understanding of the universe." Musk spent months recruiting researchers and has envisioned the new effort as becoming a rival to OpenAI, whose ChatGPT sparked an AI frenzy in the tech industry.
New York Could Be the Latest State to Ban Noncompete Agreements
ALBANY, N.Y.-A ban on noncompete agreements could soon be coming to New York-potentially with a carve-out for higher earners.
New York Gov. Kathy Hochul is considering whether to sign or veto a bill that would prohibit noncompete agreements, which typically prevent workers from taking a new job or starting a business for a period after leaving an employer.
Kamala Harris Works to Bridge Democratic Divide Over Israel-Hamas War
WASHINGTON-During more than a dozen phone calls to discuss the war in Gaza between President Biden and Prime Minister Benjamin Netanyahu, a U.S. official, who has become increasingly involved in the administration's handling of the conflict, was listening in: Vice President Kamala Harris.
In her private talks with top administration officials, Harris has emerged as one of the top policy makers bridging the divide within the Democratic Party between a hard core of Israel supporters and groups that are sharply critical of the Biden administration's approach to the war in Gaza, according to people familiar with the discussions.
Write to ina.kreutz@wsj.com
TODAY IN CANADA
Earnings:
Evertz Tech 2Q
North West 3Q
Economic Calendar (ET):
0830 Q3 Labour productivity, hourly compensation & unit labour cost
0830 Oct International merchandise trade
1000 Bank of Canada interest rate announcement
1000 Nov Ivey Purchasing Managers Index
Stocks to Watch:
D2L 3Q Rev $46.1M; 3Q Loss/Shr 1c
---
Descartes Systems 3Q Rev $144.7M; 3Q EPS 31c
---
IGM Financial Net Outflows at C$290M During November; AUM at C$234.9B as of End-November Vs C$250.3B as of End-October; Had AUM of C$256.7B at End-November 2022; Assets Declined Due to Closing of Sale of Investment Planning Counsel
Expected Major Events for Wednesday
02:00/JPN: Nov Imported Vehicle Sales
07:00/GER: Oct Manufacturing orders
07:00/GER: Oct Manufacturing turnover
09:30/UK: 3Q Household Finance Review
09:30/UK: Nov S&P Global / CIPS UK Construction PMI
09:30/UK: Nov Narrow money (Notes & Coin) and reserve balances
12:00/US: 12/01 MBA Weekly Mortgage Applications Survey
13:15/US: Nov ADP National Employment Report
13:30/CAN: 3Q Labour productivity, hourly compensation & unit labour cost
13:30/CAN: Oct International merchandise trade
13:30/US: Oct U.S. International Trade in Goods & Services
13:30/US: 3Q Revised Productivity and Costs
15:00/CAN: Nov Ivey Purchasing Managers Index
15:00/US: 3Q Quarterly Financial Report - Industry
15:00/US: 3Q Quarterly Financial Report - Retail Trade
15:00/CAN: Bank of Canada interest rate announcement
15:30/US: 12/01 EIA Weekly Petroleum Status Report
23:50/JPN: Nov International Reserves / Foreign Currency
23:50/JPN: Nov Provisional Trade Statistics for 1st 20 days of Month
All times in GMT. Powered by Kantar Media and Dow Jones.
Expected Earnings for Wednesday
Alico Inc (ALCO) is expected to report $-0.34 for 4Q.
Amtech Systems Inc (ASYS) is expected to report $0.06 for 4Q.
AstroNova Inc (ALOT) is expected to report for 3Q.
Barnes & Noble Education Inc (BNED) is expected to report $0.44 for 2Q.
Brown-Forman Corp - B Share (BFA,BFB) is expected to report $0.51 for 2Q.
C3.ai Inc (AI) is expected to report for 2Q.
Campbell Soup (CPB) is expected to report $0.87 for 1Q.
Celularity Inc (CELU) is expected to report for 3Q.
ChargePoint Holdings Inc (CHPT) is expected to report for 3Q.
Couchbase Inc (BASE) is expected to report for 3Q.
DLH Holdings (DLHC) is expected to report $0.13 for 4Q.
Duckhorn Portfolio Inc (NAPA) is expected to report for 1Q.
Evertz Technologies (ET.T,EVTZF) is expected to report $0.23 for 2Q.
Farfetch Ltd (FTCH) is expected to report $-0.39 for 3Q.
Fastenal Co (FAST) is expected to report.
Ford Motor Company (F) is expected to report.
GameStop Corp (GME,GMEB) is expected to report $-0.09 for 3Q.
Greif Inc - A Share (GEF,GEFB) is expected to report $1.22 for 4Q.
Inspired Entertainment (INSE) is expected to report $-0.12 for 3Q.
J. W. Mays Inc (MAYS) is expected to report for 1Q.
John Wiley & Sons Inc (WLY) is expected to report $0.34 for 2Q.
Korn Ferry (KFY) is expected to report $0.92 for 2Q.
Lovesac Co (LOVE) is expected to report $-0.30 for 3Q.
North West Co Inc (NWC.T) is expected to report $0.65 for 3Q.
Ollie's Bargain Outlet Holdings Inc (OLLI) is expected to report $0.45 for 3Q.
Oxford Industries (OXM) is expected to report $0.89 for 3Q.
Quantum Corp (QMCO) is expected to report $-0.09 for 2Q.
Scully Royalty Ltd (SRL) is expected to report for Interim.
Semtech Corp (SMTC) is expected to report $-0.68 for 3Q.
(MORE TO FOLLOW) Dow Jones Newswires
12-06-23 0616ET
