Another day, another record on Wall Street. As much as investors seemed agitated last week in the run-up to several decisive meetings for monetary policy in the US, they seem to have become pragmatic since then. They are waiting for important statements from Fed Chairman Jerome Powell at the Jackson Hole symposium on Friday.
The Fed may have found the right strategy to explain to investors that certain support measures are no longer justified. As is often the case, this will be an exercise that mixes communication and economic necessity, and Powell is quite good at it. Central banks are capable of making a few blunders, but the path seems to be fairly well mapped out this time.
At the same time, the Democrats have agreed on the broad outlines of Joe Biden's two large infrastructure and social spending plans, totaling nearly $5 trillion, overcoming divisions. The majority still has to work out the final details of the bill that will be voted on in the early fall and that could include several social, employment and climate change measures. This would be in addition to the $1.2 trillion for infrastructure, which is due for final approval at the end of the month. The Republican opposition will try to trim spending that it considers far too high. In addition to monetary policy, these investments will have a direct impact on equity markets later in the year.
There are still a few earnings reports as the August 31 deadline approaches. Department store operator Nordstrom fell 11.4%, after quarterly revenues were down 6% from pre-pandemic levels - the company mentioned supply chain issues and stiff competition.
Economic highlights of the day:
Two highlights on the markets today, the publication of the German Ifo business climate index for August and the announcement of durable goods orders for July in the United States.
The euro/dollar pair is stable at EUR 0.8518, while the ounce of gold is down at USD 1793. Oil is trading at USD 71.2 a barrel of Brent and USD 67.5 a barrel of WTI. The yield on US debt has risen slightly to 1.29% on the 10-year, while the German Bund yield remains stable at -0.48%. Bearish yesterday, Bitcoin is at USD 47,817
* Johnson & Johnson announced Wednesday that a COVID-19 vaccine booster sharply increased antibody levels against the disease, according to interim data from two clinical trials. The pharmaceutical company is up 0.8% in pre-market trading.
* The protection against COVID-19 conferred by two doses of the vaccine developed by Pfizer-BioNTech and AstraZeneca begins to fade before six months, British researchers have estimated, underlining the need for booster shots.
* A South Korean parliamentary committee voted Wednesday to amend an existing law to prohibit Apple and Google from imposing their payment systems on software developers in connection with application purchases on online stores, a first for a major developed economy.
* Nordstrom loses nearly 11% in pre-opening trading after reporting lower quarterly results Tuesday night than rivals Macy's and Kolh's with net sales down 6% from pre-pandemic levels.
* Urban Outfitters reported record second-quarter sales and earnings on Tuesday, above the Refinitiv IBES consensus estimate.
* PHILLIPS 66 announced Tuesday that it has put the smaller of its two Louisiana refineries up for sale.
- Admiral Group: Jefferies starts tracking at Underperform, targeting GBP 2,600.
- Asos: Deutsche Bank resumes Buy rating on the stock, targeting GBp 5400.
- Beazley: Jefferies resumes buy coverage, targeting GBP 490.
- Best Buy : R5 Capital adjusts price target to $131 from $118, maintains hold rating
- Boohoo: Deutsche Bank reiterates its Buy rating, targeting GBp 400.
- Boston Beer: Cowen cut the recommendation to underperform from market perform. PT down 34% to $400
- Campbell Soup: Piper Sandler downgrades to neutral from overweight. PT down 2.3% to $43
- Direct Line: Jefferies has initiated a buy rating on the company, targeting GBp 390.
- Dollar General : Telsey Advisory Group adjusts price target on dollar general to $260 from $235, maintains outperform rating
- Factset: Barclays upgrades. to overweight from equal-weight. PT up 22% to $450
- Hiscox: Jefferies resumes its watch on the stock, targeting GBP 950.
- JD.com : Daiwa Securities adjusts price target to $95 from $110, keeps buy rating
- LendInvest: Berenberg upgrades the rating to buy, targeting GBP 270.
- Next: Deutsche Bank resumes its Buy stance, targeting GBP 9,200.
- Okta : Raymond James raises to strong buy from outperform, price target to $310 from $300
- Palo Alto : RBC Capital adjusts pt to $475 from $445, maintains outperform rating
- Pets at Home: Berenberg remains Buy with a price target raised from GBP 540 to GBP 570.
- Sabre Insurance: Jefferies starts tracking at Hold with a GBP 240 target.
- Theravance Biopharma : Evercore ISI adjusts pt to $21 from $30, maintains outperform rating
- Ulta Beauty : Deutsche Bank adjusts pt to $417 from $410 on q2 preview, maintains buy rating
- Victoria's Secret : Barclays starts coverage at overweight with $100 price target