Log in
Show password
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Dynamic quotes 
News: Latest News
Latest NewsCompaniesMarketsEconomy & ForexCommoditiesInterest RatesBusiness LeadersFinance Pro.CalendarSectors 

North American Morning Briefing : Stock Futures Waver, Bond Yields Fall as Fed Minutes Awaited

11/24/2021 | 05:57am EST


Watch For:

Durable Goods for October; 2nd estimate GDP for 3Q; Weekly Jobless Claims; University of Michigan Final Consumer Survey for November; New Home Sales for October; Personal Income & Outlays for October; EIA Weekly Petroleum Status Report

Opening Call:

Stock futures paused as investors awaited a busy day of economic data releases ahead of the Thanksgiving holiday, plus minutes from the Federal Reserve's latest meeting.

Stock markets' gains have been tempered in recent weeks by concerns over fresh coronavirus lockdowns in parts of the world, and inflation that is proving longer lasting than many had anticipated. The robust earnings season, which had been a major boost to markets, is drawing to a close and investors are looking for fresh drivers.

"We have had fantastic earnings, the bond market is behaving itself, inflation is up but rates are very low. As I sit here with five to six weeks left to the year I have a hard time not being optimistic," said Tim Holland, chief investment officer at Orion Advisor Solutions. "As long as rates are low and earnings are growing I think it's very difficult not to lean into stocks."

Deere-whose workers approved new contracts in November, ending a strike that lasted over a month-is set to release earnings Wednesday ahead of the opening bell. Nordstrom slumped over 27% in out-of-hours trading, while Gap fell more than 18%. Both retailers reported disappointing earnings due to supply-chain issues late Tuesday, which bode ill for the sector ahead of the festive season.

A slate of economic data is due Wednesday, including some releases brought forward because of Thanksgiving. Durable goods orders, jobless claims and a second reading of third-quarter gross domestic product are due at 8:30 a.m. Data on consumer confidence, and new home sales, will be out at 10 a.m.

Data on personal spending is also due at 10 a.m. The release includes the Fed's preferred measure of inflation-the core personal-consumption expenditures price index-which is forecast to show its biggest annual rise since the early 1990s.

Overseas, European shares struggled on lockdown concerns, while in Asia, stock markets were mixed.

Stocks to Watch:

Abercrombie & Fitch plans to spend half of its capital budget on improving its digital technology, a larger share than in prior years, Chief Financial Officer Scott Lipesky said. The company said Tuesday it expects to spend $100 million on capex in the 2021 fiscal year.

Abercrombie previously spent most of its capital budget on its brick-and-mortar stores, according to Mr. Lipesky. The company's digital investments include improving mobile capabilities such as allowing customers to shop online and pick up in stores, Mr. Lipesky said.

Mr. Lipesky also said Abercrombie is examining whether to increase prices next year in response to ongoing increases in raw materials costs, particularly cotton. The company has offered fewer markdowns to customers in recent months, which in turn has increased the average price of its goods and boosted sales.

Net sales during the quarter ended Oct. 31 rose 10% from a year earlier, to $905.2 million. But ongoing increases in the price of cotton and other input costs could push the company to raise the ticket price on its apparel, according to Mr. Lipesky. "We'll think about it for 2022," he said.


Porsche said that BlackRock is investing in charging-network provider Ionity, a joint venture that includes a number of auto makers.

Porsche said it would invest $787.4 million by 2025 together with other Ionity shareholders but didn't disclose individual shares or the size of BlackRock's stake in the network. Ionity plans to increase the number of 350kW charging points for electric vehicles in Europe to 7,000 by 2025 from the current 1,500.

Apart from Porsche and BlackRock, whose investment is subject to authorities' approval, BMW, Mercedes-Benz, Ford, KIA and Audi are part of the joint venture.


The dollar was slightly firmer in Europe and CBA said another set of strong inflation figures may spur higher market pricing for FOMC interest-rate increases and help the USD Index reach a fresh 2021 high. CBA said both the headline and core PCE deflator for October could post a strong reading as signaled by the recent sharp rise in the CPI.

UBS Global Wealth Management said the Fed won't be compelled to overtighten financial conditions and will continue to balance developments in the labor market with its price stability objective.

This follows the market's movement to price in a modestly faster pace of monetary tightening with lower inflation due to Jerome Powell's nomination for a second term as Fed chairman. As disruptions from the Covid-19 pandemic fade, UBS expects the annual rate of inflation to fall from 6.5% at the end of 2021 to 1.8% by the end of 2022.

"If this is the case, it will make it easier for the Fed to justify remaining on hold until 2023," Mark Haefele, chief investment officer said.


Long-dated Treasury yields eased slightly in Europe, as investors continued to price in more monetary tightening by the Fed. Volumes were typically lower, analysts said, noting that the days before Thanksgiving tends to be comparatively thinly traded.

Investors will look for further insight into the Fed's plans for interest rates and tapering when the central bank publishes minutes from its November meeting at 2 p.m. ET.

DZ Bank said the market's pricing of almost three interest rate increases by the Fed, each 25 basis points, by the end of 2022 is excessive.

Analyst Birgit Henseler said that at the beginning of October, markets were still only pricing in one Fed interest-rate rise by December 2022 but raised their rate expectations after Jerome Powell's nomination.


Oil prices gained in Europe, but their post-SPR rally slowed, with investors' attention turning to OPEC+ when it meets next month.

Crude prices have shown limited response to the U.S.'s plan to release 50 million barrels of oil from its strategic stockpiles. The move had been well telegraphed by the White House and some market participants had been girding for a larger release.

DNB Markets' Helge Andre Martinsen said investors had expected more than 100 million barrels to be tapped overall from the major oil consumers, considerably more than the 67 million barrels released. The move had been a "classic 'sell the rumor buy the fact' dynamic."

Gold edged higher ahead of a bumper day of economic data releases, while the FOMC meeting minutes should offer bullion investors insight into the central bank's inflation views and outlook for interest rates.


Bain Capital Targets $1.5 Billion for Second Tech Opportunities Fund

Bain Capital is pitching investors on its second technology-focused fund with a goal of raising $1.5 billion barely a year after wrapping up the strategy's debut fund with $1.25 billion.

The New Mexico State Investment Council committed up to $60 million to the vehicle, Bain Capital Tech Opportunities Fund II LP, according to David Lee, the director of private equity for the council, which manages $34 billion of assets for four permanent funds. Bain Capital is committing $150 million to the fund, Mr. Lee said.

Target's Chief Legal and Risk Officer Helps Retailer Manage Bumpy Supply Chains

Target Corp. started to prepare for possible supply-chain challenges this year right after the 2020 holiday season concluded, with the help of technology tools to predict consumer purchasing patterns and mapping out potential bumps along the way that could hamper deliveries from manufacturers to its shelves.

With the start of the holiday shopping season, the retailer reported it had 17.6% more in inventory in its fiscal third quarter ended Oct. 30 compared with a year earlier, well exceeding a 13.2% growth in sales.

TD Bank's New CIO Pushes for More Women in Tech

The new chief information officer of TD Bank NA, the U.S. subsidiary of Canada's Toronto-Dominion Bank, said her priorities include encouraging women to pursue tech careers and making her staff of engineers feel supported.

Judy Dinn, who started in the role Nov. 1, succeeded Janice Withers, who has retired. Ms. Dinn said her goals take on even more importance given nationwide talent shortages that make hiring and retaining tech employees increasingly difficult.

HP Sees Office Reopenings Lifting PC Demand Ahead of Promising Holiday Season

HP Inc. reported strong earnings and gave an upbeat outlook, aided by office reopenings and an expectation for healthy consumer demand through the holiday shopping season despite supply shortages.

The PC and printer maker on Tuesday said it generated quarterly sales of $16.7 billion, up 9.3% from the year-ago period, and $3.1 billion in net income, including a one-time $1.78 billion legal settlement. The results beat Wall Street expectations for both sales and earnings.

Gap's Sales Suffer From Supply-Chain Problems Before Holidays

Gap Inc. joined a growing list of apparel chains still struggling to keep their shelves stocked even as large retailers such as Walmart Inc. say they have been able to snag enough inventory for the holidays.

Gap reported net sales of $3.9 billion for the quarter ended Oct. 30, flat from 2020 and 1% lower than 2019. The company said its brands were unable to meet strong demand from shoppers as continued fallout from Covid-19 outbreaks led to factory closures and clogged ports. Shares dropped 17% in after-hours trading.

U.S. Households Likely Increased Spending in October

U.S. consumers likely boosted spending in October, helping to power the broader economic recovery as businesses step up investment and the labor market tightens.

(MORE TO FOLLOW) Dow Jones Newswires

11-24-21 0556ET

Latest news "Markets"
01/28S&P MERVAL Index Ends the Week 5.56% Higher at 88269.83 -- Data Talk
01/28S&P/TSX Composite Index Ends the Week 0.58% Higher at 20741.75 -- Data Talk
01/28IPC Indice de Precios Y Cotizaciones Ends the Week 1.82% Lower at 50661.86 -- Data Talk
01/28BOVESPA Index Ends the Week 2.72% Higher at 111910.10 -- Data Talk
01/28The WSJ Dollar Index Rises 1.45% to 90.76 -- Data Talk
01/28Visa Ends Up 10.6%, Best Performer in the DJIA and S&P 500 Today -- Data Talk
01/28Caterpillar Down Over 6%, Worst Performer in the DJIA So Far Today -- Data Talk
01/28S&P 500 gains near the end of frenetic week
01/28CAC 40 Index Ends the Week 1.45% Lower at 6965.88 -- Data Talk
01/28STOXX Europe 50 Index Ends the Week 1.35% Lower at 3730.93 -- Data Talk
Latest news "Markets"