Central banks are trying to reassure investors that they will not tear the economy apart by boosting their key interest rates. And it may have worked… For now.
Fed's James Bullard reiterated that a soft landing was possible for the US economy despite the institution's new aggressive monetary policy. No one, not even central bankers, really knows if a gradual slowdown of the economy without a recession is possible, but it is better to say so.
After last week’s flurry of central bank announcement, we have returned to a slightly calmer period, ahead of Q2 earnings season. At the moment, listed companies must refrain from communicating with the financial community in the run-up to their periodic results, in order to ensure equal and transparent information. This blackout started four weeks before the end of the quarter and runs until the publication of results. PepsiCo will be the first major American company to publish its accounts on July 12.
After a few sessions in the red, oil is recovering, apparently because Chinese demand has picked up and refined product inventories remain low as the fuel-intensive season in the northern hemisphere approaches.
Investors are awaiting tomorrow’s biannual hearing of Fed chairman Jerome Powell at the Congress.
Economic highlights of the day:
Today, we have the Chicago Fed's activity index (08:30am) and Existing Home Sales (10am). All the macro agenda here.
The dollar is down against the euro to EUR 0.9476. The ounce of gold is also down to USD 1836. Oil is recovering slightly with North Sea Brent crude at USD 115.44 per barrel and US WTI light crude at USD 109.98. The yield on 10-year U.S. debt is down to 3.28%. Bitcoin is back up to USD 21,100.
* Tesla is up 3% in pre-market trading after the electric car maker's CEO, Elon Musk, announced that the group would reduce its workforce by about 10% over the next three months. Former Tesla employees have also filed a lawsuit in Texas against the group, saying its decision to carry out a "mass layoff" without notice is a violation of federal laws.
* Twitter - Elon Musk, who wants to buy the social network, said Tuesday that there are still unresolved issues in the deal, including spam on the platform and the group's debt.
* Kellogg announced Tuesday that it will split into three independent companies, separating its North American cereal and plant-based food businesses.
* Alphabet - The French competition authority announced Tuesday that it had accepted commitments offered by Google in the neighboring rights case and that it was closing the fund proceedings opened against the U.S. digital giant in this case.
* Exxon Mobil - The group announced Tuesday that it has signed a contract with QatarEnergy related to the expansion project of the Gulf State's North Field offshore, the world's largest liquefied gas project, following agreements signed with TotalEnergies, Eni and ConocoPhillips.
* Apple - More than 100 employees at an Apple store in Townson, Maryland, voted Saturday to form a union, an industry first in the U.S. for the tech giant.
* Intel - The U.S. semiconductor maker is seeking €593 million in interest from the European Commission five months after the European court annulled its €1.06 billion fine in an antitrust case, a notice published Monday shows.
* Visa, Mastercard - The U.K. Payment Systems Regulator (PSR) will conduct two market studies of card fees charged by the two companies, which account for 99 percent of debit and credit card payments in the U.K.
* The Boeing Company - Air India is in talks with Airbus and Boeing to order up to 300 single-aisle aircraft, sources said Sunday.
* JetBlue Airways, Spirit Airlines, Frontier Airlines - Spirit jumps 13% in pre-market trading after Monday's announcement that JetBlue had improved its offer for the low-cost airline, also coveted by Frontier Airlines, to $33.50 a share (from $31.50/share previously).
* Meta Platforms - A Moscow court on Monday rejected Facebook parent Meta's appeal against its inclusion by Russian authorities in the list of "extremist organizations," TASS agency reported.
* Mondelez announced on Monday its intention to buy energy bar maker Clif Bar & Company for $2.9 billion.
* Pfizer - French drugmaker Valneva announced Monday that Pfizer will acquire 8.1% of its capital for 90.5 million euros.
* Rada Electronics Industries - DRS, Leonardo's U.S. electronics unit, has agreed to buy Israeli company RADA Electronic Industries, the Italian defense group said Tuesday.
- Adobe: Morgan Stanley downgrades to equal-weight from overweight. PT inches 0.3% to $362.
- American Tower: J.P. Morgan upgrades to overweight from underweight. PT rises 21% to $285.
- Asos: J.P. Morgan downgrades from Overweight to Neutral targeting GBp 1,500.
- Boohoo: J.P. Morgan downgrades from Overweight to Neutral with an 85 GBp target.
- DoorDash: Goldman Sachs reinstates doordash at neutral with $67 price target.
- Intel: Bernstein is keeping its Sell rating. The target price is reduced from USD 40 to USD 35.
- ITM Power: Morgan Stanley downgrades from Overweight to Underweight, targeting GBp 180.
- Mediclinic: Berenberg starts tracking at hold, targeting GBp 464.
- On The Beach: Jefferies remains "Hold" with a price target reduced from GBp 240 to GBp 190.
- Pearson: Deutsche Bank upgrades from hold to buy targeting GBp 900.
- Spire Healthcare: Berenberg starts tracking as Buy, targeting GBp 300.
- Sunpower: Goldman Sachs cuts to sell from neutral, price target to $13 from $19