MARKET WRAPS
Today's Top Headlines/Must Reads:
- How Can Spending Be Up When People Feel Down?
- Banking Crisis Plays Out at America's Smallest Lenders
- The Bud Light Boycott Was Just the Beginning of a Crazy Year for Beer
Opening Call:
Stock futures were little changed on Wednesday, indicating the S&P 500 will open a fraction shy of a fresh record amid lingering optimism that borrowing costs will fall in 2024.
"Aside from the customary Santa seasonality, any gains witnessed for the remainder of this week may be attributed to the notable increase in the probability of a soft landing, as indicated by the latest round of high-impact macroeconomic data from the United States," SPI Asset Management said.
That bullish narrative was being additionally supported by a mostly positive return to trading by markets that were closed for Christmas break, such as the U.K., Germany, Australia and Hong Kong.
Hong Kong and mainland China markets were also buoyed by a rebound for gaming stocks after Beijing appeared to take a more conciliatory tone towards the sector.
Premarket Movers
Apple was slightly lower in premarket trading. Shares fell Tuesday for a fourth-straight session after the Biden administration declined to overturn a recent ruling that bans Apple from selling several models of the Apple Watch in the U.S. because of a patent-infringement issue.
Coherus BioSciences was up 34% after the company received approval from the FDA for its on-body injector of cancer drug Udenyca.
Intel extended gains, rising 0.6% in premarket trading, after jumping 5.2% on Tuesday and closing as the best performer in the S&P 500. The company said it would invest $25 billion in Israel to expand its wafer fabrication site after receiving $3.2 billion from the Israeli government.
Shares of NetEase rose 12% and Tencent Holdings rose 4% in Hong Kong trading after tumbling last week following proposed tougher new rules on gaming by Chinese regulators. U.S.-listed shares of NetEase fell 4% in premarket trading.
Tesla shares rose 0.3%. A Bloomberg report said the company was preparing to launch a revamped version of its popular Model Y SUV from its Shanghai plant. Tesla rose 1.6% on Tuesday.
Energy:
Oil prices edged lower with trading muted through the festive period.
Major shipping firms including Maersk and MSC are returning to shipping routes through the Red Sea, despite the ongoing fighting in the Middle East. Prices climbed on Tuesday over worries that exports through the region would be constrained by the hostilities.
Metals:
Metal prices were rising, with increasing Chinese earnings helping to boost prices in muted trading.
Data from China showed that Chinese industrial profits rose 29.5% from a year earlier in November -a sign that the government's stimulus efforts are helping the country's economy.
Meanwhile, worries over the wider global economy helped boost gold prices, given its role as a safe-haven asset.
TODAY'S TOP HEADLINES
Boart Longyear Agrees to Takeover by American Industrial Partners
Drilling services company Boart Longyear has agreed to a takeover by American Industrial Partners Capital Fund VIII in a deal that values its stock at around US$371 million.
The Utah-based, Australia-listed company said its directors unanimously recommend the takeover and that its five largest shareholders-who in aggregate control almost 99% of Boart Longyear's common shares-have agreed to vote in favor of the deal.
How China Manages Its Currency-and Why That Matters
China's approach to its currency is a mix of bold ambition and fear of dollar strength.
The yuan has lost more than 3% of its value against the greenback this year and was doing even worse before the dollar slipped against most global currencies in November. The yuan traded around 16-year lows against the dollar in September. A dollar now buys around 7.15 yuan.
China Imposes Sanctions on U.S. Data Firm
China's government hit back at U.S. criticism of its human-rights record on Tuesday by imposing sanctions on a Los Angeles firm and two analysts involved in scouring the country's supply chain for abuses.
Beijing said the actions under its Anti-Foreign Sanctions Law will be applied to Kharon, a research and data analytics firm, in response to its work monitoring Xinjiang, a far western region of China where the U.S. government, Western media and independent researchers have documented human-rights abuses against ethnic minorities, including primarily Muslim Uyghurs.
Joe Lieberman's Campaign for Third-Party Ticket Draws Ire of Democrats-Again
For decades, Joe Lieberman has been sticking his finger in the eye of the Democratic Party. But that is not, the former Connecticut senator vows, what he is up to now.
"Right now, looking at the polling, it's not No Labels that's going to re-elect Donald Trump," Lieberman said, unwrapping a cough drop at his desk in his Manhattan law office on a chilly recent morning. "Right now, it looks like it's Joe Biden who's going to re-elect Donald Trump."
Israel Widens Discussions on Egyptian Peace Proposal
Israel's war cabinet took an Egyptian proposal to end the war with Hamas to a wider group of ministers as domestic pressure grows to secure the release of hostages and regional powers look for a solution to end the fighting in Gaza.
The planned presentation to the 14-member security cabinet on Tuesday night came alongside a broader briefing to the group on hostage-release efforts and other issues related to the war's progress, according to a person familiar with the meeting's agenda.
Write to ina.kreutz@wsj.com
TODAY IN CANADA
Earnings:
Nothing major scheduled
Economic Calendar (ET):
Nothing scheduled
Expected Major Events for Wednesday
00:30/JPN: Nov Detailed Import & Export Statistics
05:00/JPN: Nov Construction Orders
05:00/JPN: Nov Housing Starts
13:55/US: 12/23 Johnson Redbook Retail Sales Index
15:00/US: Dec Richmond Fed Business Activity Survey
21:30/US: 12/22 API Weekly Statistical Bulletin
23:50/JPN: Nov Preliminary Retail Sales
23:50/JPN: Nov Preliminary Industrial Production
All times in GMT. Powered by Kantar Media and Dow Jones.
Expected Earnings for Wednesday
Barnwell Industries (BRN) is expected to report for 4Q.
Powered by Kantar Media and Dow Jones.
ANALYST RATINGS ACTIONS
AlloVir Cut to Underperform From Buy by B of A Securities
Daseke Cut to Market Perform From Outperform by Northland Capital Markets
Karuna Therapeutics Cut to Neutral From Buy by HC Wainwright & Co.
RayzeBio Cut to Market Perform From Outperform by William Blair
United Parcel Service Cut to Neutral From Outperform by Daiwa Capital
This article is a text version of a Wall Street Journal newsletter published earlier today.
(END) Dow Jones Newswires
12-27-23 0615ET
