The Nasdaq 100 has just logged its eighth consecutive session in the green, representing a considerable rebound of 8.4% since October 26. You'd have to go back two years to find such a long run on the US index most responsive to investors' renewed appetite for risk. Two years almost to the day, in fact, since the series of ten consecutive rises began on October 25, 2021 and ended on the following November 5.

Investors are about to get another taste of the Fed's language to bolster their conviction that peak rates have been reached. Jerome Powell is scheduled to speak in Washington later this morning. There is no indication that he will specifically address current monetary policy, but we'll keep an eye on him just in case. The last few speeches by Powell's peers at the Fed warned us against over-enthusiasm, but the market is only listening with a distracted ear. After Powell, other Fed members are also due to speak at various events, including two mini-hawks (Philip Jefferson and John Williams) and a rather neutral official, Michael Barr. Over the past two days, Minneapolis Fed boss Neel Kashkari, the most hawkish of the current members, has been in the news, but his austere comments haven't deflected the US market rally.

Indeed, the traditional markers of risk are falling: the VIX volatility index is returning to normal levels, bond yields have moved out of the red zone, and the ounce of gold has made a tactical pullback after surpassing USD 2,000. In other words, investors are less afraid. At the same time, the sharp contraction in oil prices is eroding what had been a kind of "X factor" on inflation prospects, which is moving in the same direction. Black gold widened its losses yesterday after projections of reduced gasoline consumption in the US, partly fueled by consumers who are a little less comfortable financially. Amid all this enthusiasm, further buoyed by solid corporate results and the Fed's supposed pivot, consumption may be the blind spot to watch. Some investors are already doing so, as evidenced by the fall in shares of certain highly exposed cyclical sectors, including automobiles and freight transport.

Elsewhere, China remains depressed after yesterday's poor export figures. Reuters came out with a big rumor this morning, according to which Beijing had asked Ping An Insurance to take control of Country Garden. Ping An denied this. However, this rumor illustrates the growing pressure from the Chinese authorities on a real estate sector that is undermining the country's economic foundations, at a time when its industry is facing a paradigm shift on Western supply chains.

Economic highlights of the day:

The second reading of German October inflation, European retail sales, U.S. wholesale inventories and DOE crude inventories are on the agenda.

The dollar is trading at EUR 0.9375 and GBP 0.8154. An ounce of gold is trading at USD 1963. Oil continues its decline, with North Sea Brent at USD 80.77 a barrel and US light crude WTI at USD 76.44. The yield on 10-year US debt stabilized at 4.58%. Bitcoin is trading at around USD 35,000.

In corporate news:

  • Biogen on Wednesday cut its full-year earnings forecast due to higher costs associated with the recent acquisition of Reata Pharmaceuticals and the launch of its Alzheimer's treatment Leqembi. The drugmaker expects full-year adjusted earnings per share of between $14.50 and $15.00, compared with $15 to $16 previously forecast. Analysts were expecting $15.26.
  • Warner Bros Discovery exceeded third-quarter earnings and cash flow estimates on Wednesday, as the box-office success of the "Barbie" movie helped offset a sluggish advertising market and a studio segment affected by two Hollywood strikes.
  • Gilead Sciences - The drugmaker said on Tuesday that third-quarter sales were little changed from the previous year, but that earnings were up 21%, mainly due to tax cuts, above consensus expectations.
  • Amazon is investing millions in the development of an ambitious artificial intelligence model, two sources told Reuters. The model, codenamed "Olympus", has 2,000 billion parameters, twice as many as OpenAI's GPT-4 models, which could make it one of the largest AI models.
  • Under Armour raised its annual gross margin forecast on Wednesday, as the sportswear manufacturer benefited from easing cost pressures and controlling expenses. The group now expects annual gross margin to rise by 100 to 125 basis points, compared with a previous forecast of 25 to 75 basis points.
  • Fisker - The electric vehicle manufacturer fell by 2.3% before the opening after postponing the publication of its third-quarter results from November 8 to 13.
  • EBay - The e-commerce platform forecasts fourth-quarter sales below Wall Street estimates, as growing competition from Amazon amplifies the impact of lower consumer spending. EBay forecasts sales for the current quarter of between $2.47 and $2.53 billion, against a consensus of $2.60 billion.
  • Coty on Tuesday raised its sales forecast for the year due to higher prices and strong demand. Coty now expects like-for-like sales growth for 2024 of between 9% and 11%, compared with a previous forecast of 8% to 10%.
  • Viatris exceeded Wall Street estimates for third-quarter Ebitda on Tuesday, rising by 2% after the close. On an adjusted basis, Viatris' Ebitda amounted to $1.36 billion, against a consensus of $1.30 billion.
  • IAC - The Internet holding company beat Wall Street estimates for third-quarter sales on Tuesday, thanks to traffic growth. Sales fell 15% to $1.11 billion, narrowly beating consensus.
  • Robinhood Markets reported a rise in third-quarter sales on Tuesday, thanks to income from its loans. The company's revenues rose to $467 million in the three months to September 30, from $361 million a year earlier.
  • Rivian Automotive on Tuesday reported better-than-expected third-quarter sales and raised its full-year production target to 54,000 units. The electric vehicle maker also said it would end its exclusivity agreement with major shareholder Amazon for its electric delivery van.
  • Lucid - The manufacturer of luxury electric cars is down 5.4% after the close after cutting its production forecasts for the full year. The company now expects production for 2023 to be between 8,000 and 8,500 vehicles, having previously forecast output of over 10,000 vehicles.
  • General Motors will recall 950 driverless cars from US roads and may withdraw others following an accident involving one of its robot cabs, the group and the US auto regulator said on Wednesday.
  • Goldman Sachs is considering divesting its credit card issuing business to General Motors, a source familiar with the matter told Reuters on Tuesday.

Analyst recommendations:

  • Advanced micro devices, inc.: CTBC Securities Investment Service Co LTD maintains its add recommendation and reduces the target price from USD 135 to USD 125.
  • Air products & chemicals, inc.: Wells Fargo maintains its overweight rating and reduces the target price from USD 345 to USD 320.
  • Akamai technologies, inc.: Baird maintains a neutral recommendation with a price target raised from USD 108 to USD 120.
  • Associated british foods plc: Bernstein maintains its outperform recommendation and raises the target price from 2800 to GBX 3000.
  • Avalonbay communities, inc.: Morgan Stanley resumes coverage with an equal weight rating and a target price raised from USD 180.50 to USD 193.
  • Celanese corporation: Baird maintains its outperform rating and reduces the target price from USD 140 to USD 135.
  • Chevron corporation: HSBC maintains its buy recommendation and reduces the target price from USD 184 to USD 169.
  • Constellation energy corporation: BMO Capital Markets maintains its outperform rating and raises the target price from USD 123 to USD 131.
  • Datadog, inc.: Baird maintains a neutral recommendation with a price target raised from USD 84 to USD 103.
  • Devon energy corporation: Peters & Co. maintains its sector perform recommendation and reduces the target price from USD 56 to USD 52.
  • Diamondback energy, inc.: JP Morgan maintains its overweight recommendation and raises the target price from USD 174 to USD 180.
  • Dr horton: Barclays maintains its overweight recommendation and raises the target price from USD 130 to USD 143.
  • Ebay inc.: Baird maintains its outperform rating and reduces the target price from USD 52 to USD 48.
  • Emerson electric co.: Baird maintains a neutral recommendation with a price target reduced from USD 99 to USD 88.
  • Expeditors international of washington inc.: JP Morgan maintains its underweight recommendation and reduces the target price from USD 110 to USD 107.
  • Extra space storage inc.: Stifel maintains its buy recommendation and reduces the target price from USD 185 to USD 165.
  • Exxon mobil corporation: HSBC maintains its hold recommendation with a price target raised from USD 116 to USD 119.
  • Fidelity national information services, inc.: Wolfe Research upgrades to outperform from peerperform with a target price of USD 65.
  • Gilead sciences, inc.: Jefferies maintains its buy recommendation and raises the target price from USD 90 to USD 95.
  • Globalfoundries, inc.: Baird maintains its outperform rating and reduces the target price from USD 100 to USD 70.
  • Gsk plc: Berenberg maintains its buy recommendation and reduces the target price from USD 44 to USD 41.
  • Intact financial corporation: Scotiabank maintains its sector outperform recommendation and raises the target price from 227 to CAD 232.
  • International flavors & fragrances inc.: Baird maintains its outperform rating and raises the target price from USD 75 to USD 80.
  • Intertek group plc: Societe Generale maintains its buy recommendation and reduces the target price from 5000 to GBX 4350.
  • Investec: Anchor Securities Stockbrokers initiates a buy recommendation with a target price of GBX 649.50.
  • Martin marietta materials, inc.: Thompson Research Group maintains its not rated recommendation with a price target raised from USD 501 to USD 527.
  • Match group, inc.: Baird maintains its outperform rating and reduces the target price from USD 49 to USD 36.
  • Mondelez international, inc.: Berenberg maintains its buy recommendation and reduces the target price from USD 87 to USD 84.
  • Nxp semiconductors n.v.: Citi downgrades to sell from neutral with a price target reduced from USD 216 to USD 150.
  • Pultegroup, inc.: Wells Fargo maintains its overweight recommendation and raises the target price from USD 80 to USD 92.
  • Quanta services, inc.: Goldman Sachs upgrades to buy from neutral with a price target reduced from USD 214 to USD 211.
  • Rivian automotive, inc.: Canaccord Genuity maintains its buy recommendation and reduces the target price from USD 44 to USD 30.
  • Schlumberger limited: William O'Neil & Co Incorporated drops coverage on the stock.
  • Shopify inc.: Loop Capital Markets maintains its hold recommendation with a price target raised from USD 57 to USD 62.
  • Trane technologies plc: William O'Neil & Co Incorporated upgrades to buy from dropped coverage.
  • Uber technologies, inc.: Bernstein maintains its outperform rating and raises the target price from USD 55 to USD 60.
  • United parcel service inc.: Loop Capital Markets maintains its hold recommendation with a price target reduced from USD 172 to USD 162.
  • Vodafone group plc: Redburn Atlantic maintains a neutral recommendation with a price target raised from GBX 75 to GBX 80.
  • Waters corporation: Baird maintains a neutral recommendation with a price target reduced from USD 275 to USD 253.
  • Zimmer biomet holdings: Citigroup maintains market perform recommendation with a price target reduced from USD 148 to USD 123.