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HomeAll NewsMost read newsBusiness Leaders Biography 
Birthday : 01/12/1964
Place of birth : Albuquerque - United States
Linked companies : Amazon.com, Inc.
Biography : Founder of Amazon.com, Inc., Explore Holdings LLC, Bezos Day One Fund and Blue Origin LLC, Jeffrey...

North American Morning Briefing: Stocks to Struggle Again as Growth Worries Linger

12/07/2022 | 06:20am EST

MARKET WRAPS

Watch For:

Revised Productivity & Costs for 3Q; EIA Weekly Petroleum Status Report; Consumer Credit for October; Bank of Canada Interest Rate Decision; earnings from Campbell Soup, GameStop

Opening Call:

Today's Headlines/Must Reads

- China Scraps Most Covid Testing, Quarantine Rules

- Accounting Red Flags Are Common Among Public Crypto Companies

- Investors See Shift in Europe's Fortunes

- Elon Musk's Release of Documents Triggers Twitter Lawyer Jim Baker's Exit

Follow WSJ markets coverage here .

Stock futures were struggling to recover ground after a four-day losing streak, as investors continued to fret about the economic damage eventually inflicted by high inflation and the Federal Reserve's campaign to damp it.

Deutsche Bank noted that the S&P 500 had now lost ground in the last seven out of eight sessions.

"In fact, the latest moves for the S&P mean it's now unwound the entirety of the rally following Powell's [supposedly dovish] speech last week, which makes sense on one level given he didn't actually say anything particularly new."

The Fed's monetary tightening alongside stubborn inflation may deliver a marked economic slowdown, JPMorgan and Goldman Sachs have warned this week.

"Fears are growing that economies are in for a rough time ahead as feverish inflation and the bitter interest rate medicine being used to bring it down take effect," Hargreaves Lansdown said.

It said the latest economic data has shown China's trade "has been sideswiped by a drop in global demand and zero-Covid policies. Despite today's easing of restrictions it's clear China's Covid nightmare is not at an end."

The Hang Seng index in Hong Kong fell 3.2%, suggesting investors had already discounted Beijing's more relaxed Covid stance.

Read Chinese Shares Fall

Stocks to Watch

ADMA Biologics said it was planning an underwritten public offering. Its shares fell 8% after hours.

Casey's General Stores lifted its same-store sales forecasts for the year and reported a 22% increase in revenue for the recent quarter. Its shares added 1.9% ahead of the bell.

Dave & Buster's Entertainment reported lower earnings for the recent quarter from a year ago, though they were better than analysts had expected. Its shares fell 4% off hours.

Guidewire Software posted higher revenue in the latest quarter as subscription revenue growth and margins improved. Its shares rose 4% off hours.

MongoDB shares gained 27% off hours after it surprised Wall Street with a profitable quarter while forecasting another one. Analysts had expected losses.

Stitch Fix cut its fiscal-year revenue outlook due to expected lower second-quarter sales, but raised guidance for adjusted earnings. Its shares fell 1.4% off hours.

Toll Brothers reported higher fiscal fourth-quarter revenue as it delivered more homes in the recent period. Its shares added 1.2% premarket.

Uniti said it plans to offer $300 million in convertible senior notes due 2027. Shares retreated 6% in after-hours trading.

Forex:

The dollar should remain supported, as growing fears of a global recession and as the Fed continues to fight inflation have driven investors to safe haven assets, ING said.

"After the broad-based risk rally seen over the last six weeks, financial markets now seem to be settling into the view of a 2023 recession," ING said, adding the dollar should perform well as long as the Fed stays "hawkish."

ING said the DXY dollar index could rise to 107.000 ahead of the Fed's policy decision on Dec. 14, when it will be too early for the central bank signal the "all-clear" on inflation with its interest-rate guidance.

Bonds:

Danske Bank said the Treasury yield curve inversion has intensified and is now at "a level only exceeded by the inversion of 1978 and 1982, when Fed Chairman Volcker hiked policy rates aggressively to counter double-digit inflation."

At the time, Volcker succeeded in bringing inflation under control but at the price of two deep and long-lasting recessions, Danske Bank said.

Energy:

Oil prices edged lower in Europe, with Brent remaining below $80 on concerns about Chinese demand and expectations of little impact from Western sanctions on Russian supplies.

Expectations that a price cap on Russian crude would crimp global supplies have fizzled while hopes that China's reopening would boost oil demand are likely premature, SPI Asset Management said.

China's tentative steps to reopen could prompt a surge of Covid-19 cases delaying a broad easing of restrictions, it added.

Metals:

Base metals were weaker in early trading in London, hurt by the stronger dollar, as investors weighed how long the Fed will keep hiking interest rates.


TODAY'S TOP HEADLINES


Elon Musk's Release of Documents Triggers Twitter Lawyer Jim Baker's Exit

Elon Musk said one of Twitter Inc.'s top lawyers "was exited," part of the fallout from the billionaire's unusual efforts to release internal communications to criticize prior practices at the company he bought almost six weeks ago.

Mr. Musk announced in a tweet Tuesday the departure of Deputy General Counsel Jim Baker, who had been with the company since 2020. Since completing the $44 billion acquisition, Mr. Musk has fired several company leaders, including Mr. Baker's immediate boss.


Jeff Bezos's Space Company Bids Again for NASA Moon Lander, After SpaceX Win

Jeff Bezos's space company said it is making another run at the moon, after the National Aeronautics and Space Administration chose rival SpaceX to handle a high-profile lunar mission last year.

Blue Origin LLC, the space company Mr. Bezos founded and has backed, said Tuesday in a tweet that it is part of a group that submitted a bid to develop a lunar lander capable of transporting NASA astronauts to the surface of the moon on future missions for Artemis, the agency's space-exploration program. Blue Origin's partners on its bid include Lockheed Martin Corp. and Boeing Co.


Microsoft Pledges to Put 'Call of Duty' on Nintendo Switch If Activision Deal Is Approved

Microsoft Corp. pledged to give Nintendo Co. access to the popular "Call of Duty" games for a decade if its $75 billion deal to buy the game's developer, Activision Blizzard Inc., gets approved, the software giant's latest move to head off possible American regulatory action to block the acquisition.

The offer follows a similar pledge that Microsoft made to Sony Group Corp., maker of the PlayStation videogame console. Sony has been the loudest of the critics of the planned Activision deal, arguing that it could hurt competition if Microsoft restricts access to Activision games. Sony has also said Microsoft could hinder competition in the global videogame industry if it were to gain ownership of "Call of Duty."


Juul Reaches Settlement of Over 5,000 Lawsuits

Juul Labs Inc. reached a sweeping legal settlement Tuesday covering more than 5,000 lawsuits and about 10,000 individual plaintiffs, resolving much of the legal uncertainty that had pushed the e-cigarette company to the brink of bankruptcy.

Juul said Tuesday that it had secured an equity investment to cover the cost of the settlement. Financial terms weren't disclosed. Juul has been in talks with early investors including two of its longtime board members, Hyatt Hotels heir Nick Pritzker and California investor Riaz Valani, to fund a bailout that would cover legal liabilities, The Wall Street Journal previously reported.


TSMC's U.S. Chip Gambit Has Powerful Backers

"American manufacturing is back," President Biden said Tuesday as he visited the new Arizona site of Taiwan Semiconductor Manufacturing Co. That sentiment may yet prove premature-but the Taiwanese chip maker's latest commitment to building on American soil is still something to celebrate.

One key takeaway from Tuesday's event: TSMC's major U.S. customers appear to be telegraphing their support for more advanced chips to be made on American soil. That raises the probability of a larger presence for firms like TSMC and Samsung in the future.


GSK, Sanofi Shares Jump After U.S. Judge Dismisses Zantac Lawsuit

Shares in pharmaceutical companies GSK PLC and Sanofi SA traded higher after a U.S. judge dismissed a series of lawsuits around a heartburn treatment that both companies had marketed.

The lawsuits, which numbered in the tens of thousands, alleged that the drug, called Zantac, could cause cancer. The judge concluded on Tuesday that there was no scientific evidence to support the claim that Zantac's active substance, called ranitidine, was carcinogenic.


Investors See Shift in Europe's Fortunes

Investors are turning somewhat more positive on Europe, spurring a recovery in the region's beaten-down stocks.

As of Tuesday's close, the benchmark Euro Stoxx 50 index had gained 18.6% this quarter, putting it on track for the best quarterly performance since 2009. The rise for the index, which includes eurozone blue chips like L'Oréal SA and LVMH Moët Hennessy Louis Vuitton SE, compares with a 9.9% gain for the S&P 500.


China Scraps Most Testing, Quarantine Requirements in Covid-19 Policy Pivot

HONG KONG-China took another step away from its stringent Covid-19 controls Wednesday, easing quarantine and testing requirements and curtailing the power of local officials to shut down entire city blocks and raise barriers to domestic travel.

The announcement from the State Council adds further evidence of a faster-than-expected pivot by Beijing away from controls that have grown increasingly unpopular and costly-and which failed to prevent the country's worst and most widespread Covid outbreak in November. The policy shift follows mass demonstrations last month against the pandemic rules that were the biggest that China had seen in decades.


China November Exports Fall; Trade Surplus Narrows

BEIJING-China's exports fell for a second consecutive month in November, weighed down by weakening global demand, official data showed Wednesday.

(MORE TO FOLLOW) Dow Jones Newswires

12-07-22 0619ET

Stocks mentioned in the article
ChangeLast1st jan.
ACTIVISION BLIZZARD, INC. 1.34% 76.61 Delayed Quote.0.08%
ADMA BIOLOGICS, INC. 0.00% 3.67 Delayed Quote.-5.41%
AUSTRALIAN DOLLAR / US DOLLAR (AUD/USD) 0.00% 0.7103 Delayed Quote.4.40%
BOEING -0.73% 211.17 Delayed Quote.11.68%
BRENT OIL -1.57% 86.05 Delayed Quote.1.71%
BRITISH POUND / US DOLLAR (GBP/USD) 0.00% 1.2397 Delayed Quote.2.63%
CAMPBELL SOUP COMPANY 0.91% 51.13 Delayed Quote.-10.71%
CANADIAN DOLLAR / US DOLLAR (CAD/USD) 0.01% 0.7508 Delayed Quote.1.73%
CHRISTIAN DIOR SE -0.25% 788 Real-time Quote.15.71%
DANSKE BANK A/S 1.35% 142.25 Delayed Quote.3.61%
DEUTSCHE BANK AG 1.71% 12.34 Delayed Quote.16.55%
DOW JONES FXCM DOLLAR INDEX 0.03% 12678.98 Real-time Quote.-1.28%
EURO / US DOLLAR (EUR/USD) 0.01% 1.0866 Delayed Quote.1.78%
EURO STOXX 50 0.10% 4178.01 Delayed Quote.10.13%
GAMESTOP CORP. 14.04% 22.82 Delayed Quote.8.40%
GSK PLC 0.34% 1410 Delayed Quote.-1.92%
GUIDEWIRE SOFTWARE, INC. 0.72% 73.22 Delayed Quote.17.04%
HARGREAVES LANSDOWN PLC 1.20% 894.2 Delayed Quote.4.44%
HYATT HOTELS CORPORATION 0.40% 112.24 Delayed Quote.24.09%
INDIAN RUPEE / US DOLLAR (INR/USD) -0.11% 0.012271 Delayed Quote.1.60%
LOCKHEED MARTIN CORPORATION -0.05% 459.6 Delayed Quote.-5.53%
LVMH MOËT HENNESSY LOUIS VUITTON SE -0.07% 801 Real-time Quote.17.81%
MICROSOFT CORPORATION 0.06% 248.16 Delayed Quote.3.48%
MONGODB, INC. 7.58% 224.01 Delayed Quote.13.80%
MSCI TAIWAN (STRD) 0.00% 547.775 Real-time Quote.8.83%
NEW ZEALAND DOLLAR / US DOLLAR (NZD/USD) -0.05% 0.6489 Delayed Quote.2.23%
NINTENDO CO., LTD. -0.09% 5630 Delayed Quote.1.77%
SAMSUNG ELECTRONICS CO., LTD. 1.10% 64600 End-of-day quote.16.82%
SANOFI -0.19% 89.55 Real-time Quote.-0.32%
SONY GROUP CORPORATION 1.00% 11630 Delayed Quote.15.89%
STITCH FIX, INC. 11.76% 4.94 Delayed Quote.58.84%
TAIWAN SEMICONDUCTOR CO., LTD. 0.63% 79.3 End-of-day quote.6.87%
TAIWAN SEMICONDUCTOR MANUFACTURING COMPANY LIMITED -0.40% 503 End-of-day quote.12.15%
TOLL BROTHERS, INC. 0.40% 57.39 Delayed Quote.14.96%
US DOLLAR / CANADIAN DOLLAR (USD/CAD) 0.00% 1.3309 Delayed Quote.-1.64%
WTI 0.00% 79.45 Delayed Quote.0.75%