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FTSE 100 Live: US stocks sink on low consumer confidence, blue-chips seen lower

Big Media Stocks Backtrack In Jittery Market; Theater Chains Soar On Tentative WGA Deal

Big media shares, which rose in pre-market trading Monday, opened lower at the bell and are still trending down midday after the Writers Guild reached a tentative deal with studios to end their prolonged strike. Renewed market jitters over inflation, interest rates and a potential government shutdown appeared to have offset relief that Hollywood is back in business – or much closer to it.

On the other hand, Netflix is up. And exhibitors, which can avoid clear and present danger if Hollywood strikes end, are seeing strong gains across the board.

As it pertains to big media groups, Wall Street has been mixed on the dual strikes by actors and writers. Shuttered production led to significantly lower costs at companies in dire need of cash to pay down debt given ongoing losses in streaming. CEOs have had two sets of earnings calls with little pushback from investors last spring, and a bit more concern in August with the fall television season upended and movie release dates starting to shift. Warner Bros Discovery said in August it anticipated a hit to earnings of up to $500 million from the strike, accompanied by a wave of free cash flow.

The WGA announced late Sunday that it had reached a tentative agreement with the AMPTP on all deal points subject to final deal language. Details of the new deal aren’t public yet so the potential impact to corporate financials isn’t clear. WGA leadership called the deal “exceptional — with meaningful gains and protections for writers in every sector of the membership.”

The SAG-AFTRA strike is still ongoing, but a WGA deal is expected to segue into a settlement with actors.

In a note to this morning titled ‘Light At The End Of The Strike Tunnel,’ TD Cowen media analyst Doug Creutz said he thinks “a similar agreement with the actors could be reached reasonably quickly.”

Late-night talk and comedy shows and daytime talk shows will be the first to return since they’re not listed among struck productions by SAG-AFTRA and it’s possible “that scripted production could be back on track before the end of October, if the SAG-AFTRA negotiations are settled expeditiously.”

“Given the length of the strike, an October settlement would still likely mean a meaningful degree of disruption to previously planned 2024 TV/film output, but at a significantly lesser scale than would have occurred if the strike had continued throughout” the fourth quarter, Creutz said.

There are still plenty of headwinds facing the industry from weak advertising to evolving DTC strategies. Media stocks, which haven’t been breaking any records, rose in early trading before the market opened before giving up most of their gains.

Warner Bros Discovery is down a substantial 2.5% at $10.82. Disney, Comcast and Paramount are all down but by less than 1% (Disney at $81, Comcast at $45 and Par at $12.61).

Netflix is up more than 1% at $383.92.

Meanwhile, exhibition stocks from AMC Entertainment (up 9%) and Cinemark (up 3.54%) to Marcus (up 2.8%) are flying high. Theatrical was again thought to be at risk as the actors’ strike in particular began to impact studio release schedules as movies got pushed back, and box office grosses, without stars promoting their films. The longer the strike, the fewer studio films on tap next year and beyond.

Are tax sops enough to make real estate investments appealing?

Most homebuyers are now scrambling to make more prepayments. Jain, though, decided against it after doing some number crunching. Jain’s residential property earns him a handsome 7.36% rental yield. He claims a 30% deduction on this rental income. Separately, he can also claim the entire interest paid on the home loan as deduction (under section 24b) since the property is let out and is not occupied by him. To be sure, deduction on interest in a self-occupied property is capped at ₹2 lakh.

After claiming both tax deductions, Jain ’s effective interest paid on the loan comes to just 2.9%. “If I put the prepayment amount in a bank fixed deposit (FD), it will earn me 4.5-5%, post tax-return. That’s higher than the effective interest rate I’m paying on the loan due to the tax sops. I’ve decided to not make any further prepayments,” he said.

This is the leverage that tax breaks on real estate purchases give property owners. “People who buy property for rental income don’t have to prepay the loan,” said Nishant Batra, chief goal planner, Holistic Prime Wealth, and a mutual fund distributor. To be sure, this may not be suitable for all property owners servicing a home loan. “Some people see loans as a leverage, while others see it as an obligation that they need to get rid of. Those considering it an obligation should close the loan as early as they can,” Nishant added.

Besides, the benefits of tax breaks on real estate properties are not limited to the decision of whether one should prepay the loan or not. The tax sops offered by the government act as subsidies that considerably bring down the effective interest you pay on the loan taken for property purchase, making real estate an attractive investment for some people (see graphic).

Special treatment

Real estate is the only asset class that enjoys a standard deduction of 30% on the rental yield. The 30% standard deduction on rental income is given to cover maintenance and repairs costs borne by the property owner. However, the actual costs of maintenance are much lower, so the 30% deduction results in net savings for homeowners. That’s not all. Homeowners can also claim deduction on interest on the home loan taken to buy the asset. Both these tax sops are not available for any other asset class (see graphic). Dividends from stocks and interest from fixed deposits are both taxable at slab rates, with no deductions allowed.

So, why does real estate get this special treatment? “The government offers all these tax benefits on real estate as it wants everyone to own a house,” said Karan Batra, managing partner, Chartered Club. However, many people utilise the tax benefits to invest in multiple real estate properties, beyond the primary house they live in. Nishant pointed out that it’s a common practice among high net worth individuals (HNIs) to opt for a loan to finance the properties that they buy for the purpose of rental income even when they have a surplus to cover such purchases.

Even when you live in the house that you buy, you can deduct up to ₹2 lakh as loan interest while calculating ‘income from house property’ in the income tax return (ITR), under section 24 of the income tax Act. While this results in loss from house property, such loss can be set off against any other income of up to ₹2 lakh in a year. The remaining amount can be carried forward to up to eight years. “In your ITR, under ‘income from house property’ head, you can declare GAV (Gross Annual Value or rent earned) of the property you live in as zero and claim the interest paid on the loan as deduction. This results in a loss from the house property equivalent to the interest paid, capped at maximum ₹2 lakh in a year,” said Nitesh Buddhadev, founder, Nimit Consultancy.

For instance, let’s assume you are servicing a ₹50 lakh home loan taken at 9% interest rate with a 25-year loan tenure. The total interest component in the first year is ₹4.47 lakh. If you avail ₹2 lakh interest as deduction, you can save tax to the tune of ₹60,000, assuming you’re in the 30% tax bracket. So, instead of ₹4.47 lakh, you just need to pay ₹3.87 lakh interest, which brings down the effective interest rate to 7.8%. If the loan on the said property is jointly taken by a husband and wife, they can claim ₹2 lakh deduction each, which means the effective interest outgo further comes down to ₹3.27 lakh or 6.5%.

In the case of rented out properties, the reduction in interest rate highly depends on the rental yield, says Nishant.

“For residential properties where the yield is 1.5-3%, the net savings will not be much. Tax benefits translate into higher savings on properties let out to grade A commercial tenants as the yield is higher. For residential, the better option is that both husband and wife buy the property for their own use on a joint loan and claim a total of ₹4 lakh deduction on the interest. Low rental yields may not move the needle much on rented out properties,” he said.

Jain’s is a case in point who has rented out his property for professional activities and hence earns a higher yield of 7.3%, akin to commercial rental yields.

Take note that only two properties per person are allowed to be treated as self-occupied. Beyond these, the owner has to pay tax on rent that accrues from other properties. If the property is vacant, it is considered deemed to be let-out and tax is paid on the notional rent. Notional rent is derived by comparing standard rent, decided as per the Rent Control Act, municipal rent as decided by the local municipal authority, and fair rent, which is the actual rent being paid on similar properties in the same area. The higher of municipal rent and fair rent is compared with the standard rent, and the lower of these two is the notional rent.

Retail investors should not see these tax benefits as an opportunity to direct all their savings in acquiring multiple properties as real estate. As an investment, it lacks liquidity and buying property to get rental yields has several unquantifiable risks. For one, letting out property runs the risk of rent default and tenants not vacating the property on time or not vacating it at all, which leads to prolonged legal disputes. More importantly, you have to bear the stamp duty cost of 5-6% each time you buy a property. You can claim this under section 80C, subject to the ₹1.5 lakh cap, which will in most cases fall short.

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Updated: 25 Sep 2023, 10:20 PM IST

Emmerdale viewers outraged as Ryan Stocks dismisses dying adopted son

It looks as though Emmerdale viewers were less than impressed with Ryan Stocks (played by James Moore) after learning his son was ill.

This week, fans of the ITV soap discovered the reason Gail Loman (Rachael Gill-Davis) had been acting suspiciously after a string of mysterious phone calls.

Meeting up with a woman called Sophie (Martha Cope), it transpired that she was the adoptive mum of a teenage son called Oscar, who Gail and Ryan had had when they were teenagers.

During their chat, Sophie revealed their son had a rare type of aplastic anaemia and desperately needed a bone marrow transplant.

On Friday night, Gail learnt that she sadly wasn’t a match, which meant she’d have to ask Ryan to get tested.

Breaking down in tears over the thought of revealing all to her boyfriend, she confessed all to Marlon Dingle (Mark Charnock), who urged her to tell Ryan as he’d understand.

Taking his advice, she sat down with Ryan and was clearly nervous about breaking the news.

Digesting the news, Ryan was furious Gail had lied to him by not letting him know their son’s adoptive mum had been in contact.

He fumed: “We are not his parents.”

She added: “Yeah, we kind of are.”

However, Ryan called what had happened a “mistake” and stated it was the right thing to give him up.

Not wanting to see a photo of his son, Gail confessed he’s sick and needs them at this moment in time.

However, Ryan was still reeling over the news and told her to get out immediately.

It looked as though viewers were less than impressed by Ryan’s reaction, as he made it clear he had no intention of getting in contact with their dying son.

@itzzzo_ said: “What an a*****le Ryan is. Surely you’d help a child if you could regardless of the circumstances?”

@1stLadyHooligan added: “I’m really surprised by Ryan’s reaction about Oscar.”

@Helz2011 commented: “Odd reaction from Ryan, wasn’t expecting that.”

@KWMadhead94 said: “He is your son Ryan and he’s dying.”

@aaron_dingles tweeted: “Ryan’s a bit of a b******d isn’t he? Imagine not wanting to help a sick child when you have the chance to.”

Although @Jamal06122771 understood the reaction by adding: “Ryan’s past has come to haunt him, he buried it, but now it has resurface. And it probably was a hard deal for him to part from his Son. The feelings have come back, he can’t handle it. It makes sense for him to feel this way.”

Emmerdale continues weeknights on ITV from 7:30pm

BlackRock Strategists Downgrade China Stocks on Growth Concerns

(Bloomberg) — BlackRock’s Investment Institute downgraded Chinese stocks to neutral from overweight, citing concerns over the nation’s property sector and the limited boost from stimulus.

“Growth has slowed. Policy stimulus is not as large as in the past,” strategists including Jean Boivin wrote in a report Monday. “Structural challenges imply deteriorating long-term growth. Geopolitical risks persist.”

Just a week ago, the think tank at the world’s biggest asset manager expressed hopes for China’s stimulus measures, saying subdued inflation would create space for more policy easing, while also citing low valuations. BII last upgraded Chinese stocks in February to overweight, citing short-term opportunities from the reopening. Since then, the MSCI China Index has lost 13%.

Chinese stocks are among the world’s worst performers this year, with the Hang Seng China Enterprises Index having fallen more than 20% from a January high. The country’s economy is struggling with default risks in the property market and a sluggish recovery in domestic consumption. Beijing has announced various stimulus measures since July, with limited effect.

The MSCI China Index was down 0.2% as of 10:47 a.m. in Hong Kong, heading for its lowest close in almost a month.

Given the drag of a slowing Chinese economy, BlackRock strategists cut emerging-market stocks to neutral from overweight as well. “We see growth on a weaker trajectory and see only limited policy stimulus from China,” it said.

In the meantime, BlackRock strategists further upgraded Japanese stocks, thanks to “strong earnings, share buybacks and other shareholder-friendly corporate reforms.”

The post BlackRock Strategists Downgrade China Stocks on Growth Concerns appeared first on Bloomberg.

Stocks edge higher as US$95 Brent boosts oil majors

(Bloomberg) — Global stocks struggled to hold on to gains as traders braced for this week’s burst of central bank decisions. Benchmark Brent crude oil topped $95 a barrel for the first time since November, adding to concerns about inflation.

Oil majors TotalEnergies SE, BP Plc and Shell Plc were among the outperformers as Europe’s Stoxx 600 index surrendered an earlier advance, while US equity futures drifted toward being little changed.

Crude has soared by about a third since mid-June as Saudi Arabia and Russia joined hands to curb supplies and drive a rebound in prices. That move has sustained the pressure on central bankers as they seek to cool inflation, while managing risks to their economies. The Federal Reserve sets policy Wednesday, the Bank of England Thursday and the Bank of Japan Friday.

“Central banks have done a rather good job so far, but there’s little room for manoeuvre now,” said David Kalfon, chief executive officer of Sanso Investment Solutions. “They made clear since the start of the cycle that beating inflation is the key, not growth.”

US Treasury yields ticked higher, while a gauge of dollar strength slipped.

The prospect of rates staying higher for longer has drained some of the enthusiasm toward tech shares, after they led the rally in US stocks earlier this year. Flows suggest investors are positioning for more losses in the Nasdaq 100, according to Citigroup Inc. strategists.

Nasdaq futures continued to attract bearish flows last week, leaving positioning heavier on short bets rather than long, the team led by Chris Montagu said. That suggests “few investors are comfortable taking a bullish view on the possibility of a near-term reversal for the growth/tech related index,” they wrote in a note dated Sept. 18. The Nasdaq 100 is down about 3.9% from a peak on July 18.

In individual stock moves Tuesday, Dell Technologies Inc. rose in US premarket trading after Daiwa Securities upgraded the computer company to outperform on improved demand trends. Coinbase Global Inc. and Marathon Digital Holdings Inc. were among cryptocurrency-related stocks heading higher as the price of Bitcoin climbed above $27,000.

With the Fed forecast to keep interest rates on hold this week, traders will be focused on the so-called dot plot summary of economic forecasts. The two main questions are whether policymakers will retain their projections for one more 25 basis-point hike by year-end, and how much easing they are penciling in for 2024. In June, they projected one percentage point of cuts.

“The Fed is likely to highlight that in its collective view the fight against inflation has not yet been won and that the FOMC will be highly data-dependent in terms of future rate decisions, leaving the door open for a possible rate hike later in the year,” said Richard Flax, chief investment officer at European digital wealth manager Moneyfarm. “If the Fed sounds a more hawkish tone, we could see a continuation of the higher-for-longer trend that we’ve seen recently, with lower probability of significant rate cuts in 2024.”

Key events this week:

This week, Ukrainian President Volodymyr Zelenskiy is expected to meet with Joe Biden at the White House, attend United Nations General Assembly in New York
OECD releases interim economic outlook report on the global economy, Tuesday
Eurozone CPI (August final), Tuesday
Bloomberg Future of Finance Conference in Frankfurt, with speakers to include German Finance Minister Christian Lindner, Tuesday
Japan trade, Wednesday
China loan prime rates, Wednesday
UK CPI, Wednesday
Federal Reserve policy meeting followed by Fed Chair Jerome Powell’s news conference, Wednesday
Bank of Canada issues summary of September’s policy meeting, Wednesday
Eurozone consumer confidence, Thursday
Bank of England policy meeting, Thursday
US leading index, initial jobless claims, existing home sales, Thursday
China’s Bund Summit, Friday
Japan CPI, PMIs, Friday
Bank of Japan rate decision, Friday
Eurozone S&P Global Eurozone PMIs, Friday
US S&P Global Manufacturing PMI, Friday

Some of the main moves in markets:

Stocks

S&P 500 futures were little changed as of 8:31 a.m. New York time
Nasdaq 100 futures were little changed
Futures on the Dow Jones Industrial Average were little changed
The Stoxx Europe 600 was little changed
The MSCI World index was little changed

Currencies

The Bloomberg Dollar Spot Index fell 0.2%
The euro rose 0.2% to $1.0710
The British pound rose 0.3% to $1.2417
The Japanese yen was little changed at 147.74 per dollar

Cryptocurrencies

Bitcoin rose 1.9% to $27,270.94
Ether rose 0.7% to $1,649.8

Bonds

The yield on 10-year Treasuries advanced four basis points to 4.34%
Germany’s 10-year yield advanced three basis points to 2.74%
Britain’s 10-year yield declined two basis points to 4.38%

Commodities

West Texas Intermediate crude rose 1.3% to $92.68 a barrel
Gold futures rose 0.3% to $1,958.50 an ounce

This story was produced with the assistance of Bloomberg Automation.

–With assistance from Tassia Sipahutar.

The post Stocks edge higher as US$95 Brent boosts oil majors appeared first on Bloomberg.

Wall Street is turning cautious on US stocks, while some experts warn of pain ahead. Here’s what JPMorgan, Jeremy Grantham and

There’s a growing sense of caution in the US stock market about the economy as 2023 swings toward its final quarter – and it’s fostering a more defensive approach among investors.

It’s a shift of mood from the first half, when investors cheered the rise of artificial intelligence – and what the groundbreaking technology could mean for productivity and corporate profits.

The S&P 500 share index is on track for its first two-month decline in a year, with investors worrying that a combination of high interest rates, dwindling household savings, and rising consumer debt could bring bad news for stocks and the wider economy.

Among those adopting a more cautious investment approach include Wall Street banks such as JPMorgan and Bank of America. Experts such as John Hussman, the notorious market bear who predicted the 2000 and 2008 crashes, also recently warned of pain ahead for stocks, urging them to “buckle up.”

Here is a selection of the latest market commentary from six top voices who have turned relatively downbeat in their outlooks.

JPMorgan

Bank of America Merrill Lynch

John Hussman, president of Hussman Investment Trust

Ken Griffin, Citadel CEO

Mike Wilson, Morgan Stanley’s stock chief

Jeremy Grantham, veteran investor

The post Wall Street is turning cautious on US stocks, while some experts warn of pain ahead. Here’s what JPMorgan, Jeremy Grantham and others have said. appeared first on Business Insider.

Bitcoin Is Headed for Its First Weekly Gain Since August

Bitcoin is poised to snap a four-week decline, but analysts are questioning how long the rally will last.

The largest cryptocurrency by market value has gained about 2% since last Sunday to around $26,358.

“The crypto bulls badly needed a bounce this week,” said Matt Maley, chief market strategist at Miller Tabak Co. “Things were looking bleak as the week started, so the bounce has provided some very important relief.”

The possibility of a weekly gain comes as Bitcoin rebuilds its correlation with technology stocks, mirroring the price moves of the Nasdaq 100 Index as it climbed earlier this week. However, the tech-heavy index is on track to be flat to modestly negative for the week as declines in Amazon.com Inc. and Nvidia Corp. drag it lower on Friday. With investors getting ready to parse a bevy of economic data and the Federal Reserve’s rate decision next week, it’s unclear how stocks will perform going forward.

Will Tamplin, senior analyst at Fairlead Strategies, says it’s prudent to not be overly optimistic about the recent gains in Bitcoin.

“Our short-term momentum indicators show improvement, but we are cautious regarding the sustainability of a rally since intermediate-term has deteriorated in recent weeks,” he said. “If Bitcoin can clear its 50-day moving average, currently near $27,400, it would increase our confidence in a short-term rebound.”

Read More: Bitcoin Is Getting Back to Trading in Tandem With Tech Stocks

The level investors are now watching on Bitcoin is $28,800.

Any break below that level — Bitcoin’s low in both June and September — could lead a lot of investors to give up on the digital asset, according to Maley.

“That $28,800 level is now the ‘line in the sand’ for the Bitcoin bulls,” he said.

LME Copper Stocks Rise to Two-Year High as Demand Falters

(Bloomberg) — Copper stockpiles immediately available to withdraw from the world’s top metals bourse hit the highest in almost two years, adding to evidence of flagging demand.

On-warrant copper inventory held by the London Metal Exchange rose on Wednesday by 5.7% to the highest since September 2021, according to bourse data. That’s a sharp turnaround from just three months ago when stocks fell to the lowest in almost two years.

Copper bulls have been disappointed by the metal this year after predicting a rally driven by a revival in Chinese demand, consumption by green technology and tight supply. Instead, prices are close to little changed year-on-year, after giving up earlier gains.

While warehouse inventories are sometimes used to gauge the mismatch between supply and demand, they can be impacted by individual trades and idiosyncratic market strategies. Still, the figures are just the latest signal that the copper market remains well supplied.

Treatment and refining charges by smelters remain high, an indication the raw materials used to make refined copper are relatively plentiful. China — the world’s top copper consumer — has been posting weaker-than-expected economic data that’s also weighed on the metal.

Most of the recent copper inflows have been into European and American warehouses. Gauges of manufacturing, a key source of demand, in both regions indicate the sector has been contracting for several months.

Copper futures added 0.3% to trade at $8,414 a ton on the LME by 5:31 p.m. London time. Other metals were mostly higher, with zinc adding 2% and tin rising 0.6%.

The post LME Copper Stocks Rise to Two-Year High as Demand Falters appeared first on Bloomberg.

Asian Stocks Set for Mixed Open After US CPI: Markets Wrap

(Bloomberg) — Stocks in Asia climbed on cautious optimism the Federal Reserve may pause rate hikes following the US inflation report that was in line with estimates. The dollar slipped.

Japan’s Nikkei 225 outperformed the region and equities in South Korea gained as a benchmark index for the region snapped a two-day loss. US stock futures also rose. Japanese shares received an extra boost after Economic Revitalization Minister Yoshitaka Shindo said the government will use all policies for economic management and highlighted the need for strong economic measures.

The greenback weakened against all of its Group-of-10 peers and Treasuries ticked lower. The euro steadied as traders also awaited the rate decision by the European Central Bank later Thursday.

The US’s core consumer price index, which excludes food and energy costs, increased 4.3% from a year ago — in line with estimates and marking the smallest advance in nearly two years.

“Asia has some clear air to reclaim some of the week’s losses,” said Kyle Rodda, a senior analyst at Capital.com in Melbourne. “US inflation offered up more questions than answers, but it’s a volatility event out of the way, so that’s supportive of risk assets at the margins – the proverbial can has been kicked down the road just a little.”

Hong Kong and mainland China shares swung between gains and losses as concerns remained in the property sector. Country Garden Holdings Co. fell as the deadline approaches for holders of a yuan bond to vote on the company’s repayment extension request.

Eyes on Next Data

Evidence is building that Europe is facing persistent cost pressures that have been made worse by soaring energy prices. Money markets are pricing in a two-thirds chance the ECB raises interest rates by a quarter of a percentage point, a rapid shift from earlier this month where traders were firmly in the camp rates would be held steady.

“It will be a close decision,” said Imre Speizer, a strategist at Westpac Banking Corp. in Auckland. “Inflation persistence is likely to feature in the ECB’s upgraded projections” with core prices more stubborn, he wrote in a note to clients.

Traders will be closely monitoring a sale of 20-year securities amid speculation the Bank of Japan may take steps to normalize policy. Also due later Thursday are US retail sales and producer price data.

The S&P 500 was little changed on Wednesday while the Dow Jones Industrial Average underperformed. American Airlines Group Inc. led US stock losses after cutting its earnings outlook amid a jump in jet fuel prices. Most megacaps rose, with the chiefs of five of the 10 biggest US companies appearing at a closed-door Senate meeting to shape how artificial intelligence is regulated. Apple Inc. fell as China flagged security problems with iPhones.

In commodities, oil trade near the highest since November after the International Energy Agency added to warnings of a supply shortfall, while gold edged higher after losses in the last two sessions.

Key events this week:

Japan industrial production, Thursday
European Central Bank policy meeting and news conference by President Christine Lagarde, Thursday
US retail sales, PPI, business inventories, initial jobless claims, Thursday
China property prices, retail sales, industrial production, Friday
US industrial production, University of Michigan consumer sentiment, Empire Manufacturing index, Friday

Some of the main moves in markets:

Stocks

S&P 500 futures rose 0.3% as of 12:06 p.m. Tokyo time. The S&P rose 0.1%
Nasdaq 100 futures rose 0.4%. The Nasdaq 100 rose 0.4%
Japan’s Topix rose 0.7%
Australia’s S&P/ASX 200 rose 0.5%
Hong Kong’s Hang Seng fell 0.3%
The Shanghai Composite was little changed
Euro Stoxx 50 futures rose 0.1%

Currencies

The Bloomberg Dollar Spot Index fell 0.1%
The euro rose 0.1% to $1.0742
The Japanese yen rose 0.3% to 147.07 per dollar
The offshore yuan was little changed at 7.2785 per dollar
The Australian dollar rose 0.2% to $0.6433

Cryptocurrencies

Bitcoin rose 0.2% to $26,278.53
Ether rose 1.1% to $1,622.15

Bonds

The yield on 10-year Treasuries declined two basis points to 4.23%
Japan’s 10-year yield was unchanged at 0.705%
Australia’s 10-year yield declined four basis points to 4.11%

Commodities

West Texas Intermediate crude rose 0.4% to $88.90 a barrel
Spot gold rose 0.1% to $1,910.29 an ounce

This story was produced with the assistance of Bloomberg Automation.

–With assistance from Tassia Sipahutar.

The post Asian Stocks Set for Mixed Open After US CPI: Markets Wrap appeared first on Bloomberg.

Wharton professor Jeremy Siegel sees an ‘upward tilt’ for stocks during the rest of 2023 – and says there’s no clear sig

Wharton finance professor Jeremy Siegel said US stocks will likely maintain an “upward tilt” this year – and emphasised the resilience of the world’s largest economy.

The esteemed economist, also dubbed the “Wizard of Wharton,” shared his outlook in a weekly WisdomTree blog.

“There was not much new economic news that came in last week, but the data that did come in continues to show underlying resilience in the economy. It is not an overly strong economy but also not one where there are clear signs of a recession, or a significant slowdown of any kind is at hand,” Siegel said.

Siegel has been among the more bullish economic commentators lately, recently highlighting the nation’s “amazing resilience” despite the Federal Reserve’s aggressive interest-rate increases over the six quarters aimed at taming inflation.

He’s previously stated that US equities are on solid footing because the inflation threat is fading, meaning the Fed may be able to soon start loosening monetary policy.

“It is highly unlikely for the Fed to increase rates in September, and while the markets have priced in some probability of a November hike, I don’t think the Fed needs to make that move,” Siegel said in his most recent commentary.

“For equities, I still see an upward tilt for the remainder of the year,” he added.

US stocks have surged this year thanks to investor excitement about artificial intelligence – and hopes that it the groundbreaking technology will boost productivity and prop up corporate profits.

Insider’s Matthew Fox reported that stocks could hit new highs by the end of this year as a leading bond market indicator just flashed a bullish signal.

The post Wharton professor Jeremy Siegel sees an ‘upward tilt’ for stocks during the rest of 2023 – and says there’s no clear sign of a recession appeared first on Business Insider.

Stocks steady, dollar catches breath as traders eye US CPI

SINGAPORE, Sept 12 – Asian stock markets nudged sideways on Tuesday while the dollar took a breather, its recent gains chastened by resistance from central banks in China and Japan and by traders waiting on U.S. inflation data to signal that interest rates may have peaked.

The yen notched its best day against the dollar in two months overnight, after Bank of Japan Governor Kazuo Ueda said policymakers might have enough economic information by year’s end to determine that short-term rates will need to rise.

The yuan had its best day in six months after authorities vowed to correct one-way moves and Reuters reported the central bank had stepped up scrutiny of dollar buying.

Both, however, remain near their weakest levels of the year and with the yuan at 7.3022 per dollar in offshore trade and the yen last a little off Monday highs at 146.68 per dollar.

Japanese government bonds remained under pressure on Tuesday, with 10-year JGB yields up 1 basis point to a fresh high of 0.71%.

“The result of Ueda’s comments was an intense move higher in Japanese swaps and government bond yields,” said Chris Weston, head of research at brokerage Pepperstone in Melbourne.

“(It) is certainly constructive for yen longs. (But) I refrain from getting too excited at this stage…where the actions are more of a medium-term issue – we won’t get the outcome of the spring wage negotiations until April 2024.”

MSCI’s broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) was flat. Japan’s Nikkei (.N225) rose 0.3%, with markets looking to U.S. inflation data and this week’s European Central Bank meeting to set interest rate expectations and the mood.

Due on Wednesday, markets are expecting the U.S. figures to show annualised core inflation falling to 4.3% in August though the headline number is seen ticking up to 3.6%.

“A lower-than-expected print may slow the U.S. dollar’s rise while higher print could potentially un-nerve risk sentiments as it would reinforce market expectations for further rate hikes, and this could fuel dollar strength,” said OCBC strategist Christopher Wong.

Interest-rate futures markets are pricing about a 45% chance of another U.S. rate hike by year’s end.

Investors’ appetite for risk is also to be tested this week when British chip designer Arm Holdings lists in New York with a goal of raising almost $5 billion.

Overnight, the weaker dollar and upgrade on Tesla from analysts at Morgan Stanley helped U.S. stock markets gain. Tesla (TSLA.O) rose 10%. The S&P 500 (.SPX) rose 0.7%.

In early Asia trade, U.S. futures slipped 0.2%.

Elsewhere in currency trade, the Australian dollar was weighed by a further slip in consumer sentiment, which has been below the neutral 100 mark since March 2022 – the longest streak since a recession in the early 1990s.

The Aussie , which bounced on Monday with gains in the yuan, was last down 0.1% at $0.6424. The New Zealand dollar also dipped 0.1% to $0.5911.

The euro gained on the dollar overnight but moves have been muted with investors dialling back long euro positions ahead of Thursday’s ECB meeting. Pricing implies about a 56% chance that policymakers leave rates on hold.

“There is a sense that ECB is already done for the cycle,” said Maybank analysts in a note to clients.

“Recent PMI prints suggest that growth outlook could be deteriorating and puts the euro at risk of further downside. This is all the more amplified by lingering expectations for the Fed to hike further.”

Benchmark 10-year Treasury yields were steady at 4.2980%.

In commodity markets, Brent crude futures were steady at $90.59 a barrel. Gold hung on at $1,921 an ounce, while bitcoin was out of favour and dropped below $25,000 for the first time in three months.

Editing by Lincoln Feast.

Our Standards: The Thomson Reuters Trust Principles.

The post Stocks steady, dollar catches breath as traders eye US CPI appeared first on Reuters.

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