MARKET WRAPS
Watch For:
World Agricultural Supply & Demand Estimates; Oracle earnings
Opening Call:
Stock futures edged higher on Monday, putting equities on track for a fourth straight session of gains, as investors looked to key inflation data coming later in the week.
"U.S. and European futures are picking up the momentum from Asia, where things have been trading in a positive direction," said Naeem Aslam, an analyst at broker AvaTrade.
Looming large in the days ahead is the U.S. consumer-price index for August. The inflation data will be key ahead of the Federal Reserve's next decision on monetary policy, scheduled for next week.
"For the rest of the week, there's only one focal point and that's the CPI report tomorrow, the last before the Fed's Sept. 21 meeting," Deutsche Bank said.
"The Fed are now in their blackout period so that will reduce the central bank chatter somewhat this week."
Stocks to Watch:
Read Barrons.com: KKR and Blackstone REITs to Benefit From the Credit Slowdown, Analyst Says
Forex:
The DXY Dollar Index fell to a two-and-a-half-week low in early European trading and MUFG Bank said a narrowing of the monetary policy divergence between Europe and the U.S. was weighing on the dollar, although declines are likely to be limited.
Europe-U.S. interest rate rise expectations narrowed after the European Central Bank lifted rates 75 basis points last Thursday that won't be sufficient on its own to trigger sustained dollar weakness, MUFG Bank said.
"The U.S. rate market is still confident that the Federal Reserve will continue to front-load policy tightening through the remainder of this year by delivering a third consecutive 75bp hike on September 21."
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The euro, Norwegian krone and Swedish krona look set to reverse their recent gains due to Europe's energy crisis, Danske Bank said.
"With public balance sheets seemingly set to cushion Europe from the energy shock--and hence keep real rates [interest rates adjusted for inflation] relatively depressed--the EUR FX will remain the pressure relief valve," Danske Bank said.
The eurozone growth outlook remains bleak and with central banks still front-loading monetary policy tightening, that's rarely an environment where EUR, NOK and SEK rallies can be sustained, Danske Bank added.
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The pound was mixed after data showed U.K. GDP expanded less than expected in July, with ING saying Tuesday's U.K. jobs figures will be more significant.
"The adjustment for the June bank holiday makes the [GDP] figures a little difficult to read and we think the Bank of England will take more notice of tomorrow's August jobs data for insight into how tight the U.K. labor market really is."
Read: U.K. Economy Picked Up Modestly in July
Energy:
Oil futures were close to flat in Europe as investors balanced tight supplies with concerns about Chinese lockdowns crimping demand.
Brent has tumbled over 14% so far this month and WTI remains firmly below $100, as demand concerns have dominated investors' attention. Still, supply risks from OPEC+ cuts to a failure to achieve a nuclear deal with Iran are being overlooked, TD Securities said.
Some analysts also said EU steps to cap Russian oil prices could prompt Russia to withhold supplies, while the continent's efforts to move away from gas also promise additional demand for oil.
"Energy markets are entirely ignoring the broad scope of supply risks," TD Securities said.
Metals:
Base metals and gold started the week higher on expectations that Tuesday's CPI print will fall.
"The recent slump in commodities, with WTI firmly below $100 throughout the month, is likely to put downward pressure on the headline number, as are gas prices being down 12% over the month," Deutsche Bank said.
TODAY'S TOP HEADLINES
Activist Investor Dan Loeb Backs Off Pushing Disney to Sell ESPN
Activist investor Dan Loeb signaled Sunday morning on Twitter that he is backing off his push to persuade Walt Disney Co. to spin off its popular sports television network ESPN.
The change of heart comes after Disney Chief Executive Bob Chapek said in media interviews at this weekend's D23 Expo event-an annual gathering of Disney fans where the company announces new shows and films-that he has plans for ESPN to be a big growth engine and a large part of the company's entertainment offerings.
Visa, Mastercard, Amex to Track Gun Shops With New Merchant Code
Visa Inc., Mastercard Inc. and American Express Co. will add a new merchant category for firearms retailers, a victory for gun-control advocates who have pressed the financial industry to do more to help curb mass shootings.
The new merchant-category code was recently approved by an international entity that sets standards for the payments industry.
Deere Invests Billions in Self-Driving Tractors, Smart Crop Sprayers
For decades, Deere & Co. has dominated the hardware that powers the American farm industry with tractors, harvesters and other machinery used to plant seeds and reap crops.
Now, Deere aims to extend its dominance to software to make those machines-and agriculture-more efficient and productive.
Apple's iPhone Satellite Service Kicks Off Smartphone Space Race
Apple Inc.'s new emergency-text feature on its latest iPhones makes it a first-mover in a budding market for low-cost satellite phone connections.
The Cupertino, Calif., tech giant last week said its new iPhone 14s will be able to beam short distress messages and location data from places off the cellular grid as soon as November. The service will cover the U.S. and Canada but could expand to more countries.
Nikola Founder Faces Securities-Fraud Trial Over Promises About Electric Trucks
Trevor Milton, the Nikola Corp. founder who enticed auto-industry leaders and investors with his promise for a revolution in electric trucks, faces a securities-fraud trial beginning this week on allegations that he lied about his company's development of environmentally friendly technology.
Federal prosecutors in Manhattan last year accused Mr. Milton of running a scheme to enrich himself and boost his stature as an entrepreneur by falsely hyping Nikola's prospects and duping nonprofessional investors, including stock-market novices. He was indicted on two counts of wire fraud and two counts of securities fraud. Jury selection begins Monday.
U.S. Heat Wave Hits Supermarkets' Produce Sections
High temperatures in the Western U.S. are hitting the produce industry, damaging crops, shrinking shipments and leaving fewer leafy greens and fruits on supermarket shelves.
A California grower said some of his lettuce leaves are turning brown and melting in the fields because of crop diseases intensified by the high temperatures. In Pennsylvania, a retailer said its stores went a week without having strawberries to sell. A New York distributor has substituted honeydew melons for watermelons, which have become scarce.
Cruises' Covid-19 Rules Are All Over the Place
Figuring out the rules for boarding a cruise ship requires serious navigation these days.
Many major cruise lines recently loosened their pandemic rules around testing and vaccination requirements in a bid to get more passengers aboard. The changes, announced this summer and implemented in recent days, come on the heels of the Centers for Disease Control and Prevention ending its Covid-19 reporting program for cruises and lowering its warnings against the risk of such travel.
India's Edtech Startups Regroup as Pandemic Bonanza Fizzles
NEW DELHI-The hottest thing in India's online-education industry right now is going offline.
After two years of blistering growth, sparked by one of the world's longest Covid-19 school shutdowns, India hosts an increasingly crowded field of education-technology unicorns. Six have hit the $1 billion valuation milestone since the March 2020 nationwide lockdown. They joined Byju's, which got there in 2017 and is now the world's most valuable edtech startup, with a $22 billion price tag after a funding round in March, according to PitchBook Data Inc.
TV Networks Have a New Role: Farm Teams for Streaming Shows
Broadcast networks are launching fewer new shows than usual this fall, the latest sign of their diminished popularity and ambitions amid ever-growing competition from streaming services.
The parent companies of ABC, NBC and CBS now see the networks as a first stop for their content before it moves to their sister streaming services. They argue that is the role they should be judged on for now.
Inflation Showed Signs of Easing in Several Industries in August
U.S. consumer-price inflation showed signs of moderating in August for the second straight month, though the decrease was uneven across sectors and it remains unclear whether the slowdown will continue.
Gasoline prices fell sharply in August, airfares dropped and used cars and hotels ebbed, while rent increases also gave hints of slowing, according to private firms that track such data.
Covid-19 Illnesses Are Keeping at Least 500,000 Workers Out of U.S. Labor Force, Study Says
Illness caused by Covid-19 shrank the U.S. labor force by around 500,000 people, a hit that is likely to continue if the virus continues to sicken workers at current rates, according to a new study released Monday.
Millions of people left the labor force-the number of people working or looking for work-during the pandemic for various reasons, including retirement, lack of child care and fear of Covid. The total size of the labor force reached 164.7 million people in August, exceeding the February 2020 prepandemic level for the first time. The labor force would have 500,000 more members if not for the people sickened by Covid, according to the study's authors, economists Gopi Shah Goda of Stanford University and Evan J. Soltas, at the Massachusetts Institute of Technology.
European Manufacturers Reel From Russian Gas Shutoff
(MORE TO FOLLOW) Dow Jones Newswires
09-12-22 0537ET
