New Commercial Vehicle Registrations in Europe statistics; U.S.
interest rate decision; updates from Hapag Lloyd, Lonza, Sage
European stocks could rise for a second day, while U.S. stock
futures also point to early gain on Wall Street. Dollar
strengthens. 10-year Treasury yields unchanged. Oil falls. Gold
European stocks could extends gains Thursday ahead of a U.S.
Federal Reserve meeting that will indicate how aggressive it will
be in fighting inflation.
U.S. stock futures were also pointing higher. Tuesday on Wall
Street, shares came well off their lows by late afternoon. But
another burst of selling in the final hour of trading pulled them
lower again. Technology stocks were the biggest drag on the
Wall Street is dealing with signs of slowing economic growth
because of COVID-19 and a Fed that can't really go back on what it
said it would do, said Barry Bannister, chief equity strategist at
"The market has come to terms with that and that's a big deal,"
he said. "Fiscal and monetary tightening, together, is tough on
financial assets when they're coming off of a rip-roaring party
Still, the fact that the major stock indexes came off their lows
of the day could be a sign that some investors are betting that a
dimmer outlook for economic growth may prompt the Fed to take a
more measured approach to raising interest rates.
"Weaker economic growth projections have contributed to
investors breathing a sigh of relief that the Fed won't have to be
overly aggressive," said Sam Stovall, chief investment strategist
Stocks in Asia were mixed.
The dollar strengthened 0.4% against the euro and is a hair
weaker against the yen. The dollar's recent strength isn't
complicated, Scott Petruska, chief currency strategist at Silicon
Valley Bank, told WSJ.
"It's a dollar story. It's a rush into safer currencies." He
said the dollar is outperforming the Swiss franc and yen due to
more attractive interest rates and yields.
"The Fed meeting is coming up and they're ready to cut stimulus
more aggressively" than the Swiss, Japanese or other major central
banks. The risk-off mood that's helping the dollar is driven by the
"spectacular fall and volatility" in the US stock market,
especially in tech, and the Russia-Ukraine crisis, Petruska
Asian currencies consolidated against the U.S. dollar in the
Asian morning session ahead of the FOMC meeting's outcome later in
Sentiment seems to have tilted to the cautious side, with market
participants bracing for the FOMC decision, DailyFX.com said.
With inflation running high and commodity prices edging up,
markets may be expecting the Fed to tighten policy sooner and
quicker, DailyFX.com added.
The 10-year Treasury yields was unchanged. Investors are looking
at the Fed meeting and presser, with some discussion about whether
policy makers are seeing any reason to speed up monetary
tightening, or rather to get a little more dovish after the Omicron
The impression left from the previous meeting is that tapering
will wrap up, and rates will lift off, in March. The prospect of
higher rates is blamed for the recent volatility in equity markets,
while the 10-year yield is up 0.288 percentage point year to
Oil fell in early Asian trade, tracking equity-market weakness
amid fears of interest-rate increases by the Fed, Rystad Energy
said. Investor pessimism is outweighing bullish fundamentals, the
energy consulting firm said, pointing to crude-supply concerns due
to Ukraine-Russia tensions and OPEC+ struggling to hit its targeted
monthly output increases.
Regardless, Rystad reckons these factors should cap any
near-term losses in oil prices. "Oil prices will remain bullish
through the end of February" although bearish blips may occur, it
Gold edged higher in Asia on Fed-tightening fears and as
geopolitical risks grow, according to Oanda. It said the precious
metal is rallying as investors scamper to safety over fears the
Fed, which is holding a regular policy meeting, will signal an
aggressive tightening of monetary policy.
Oanda also points to tensions between the Ukraine and Russia,
the Iranian nuclear deal and North Korea's recent missile launches
as further reasons for investors to flock to the asset.
Copper prices were slightly lower in early trade, as risk-off
sentiment weighs amid uncertainty surrounding the outcome of the
Federal Reserve meeting, ING said.
ING also expects copper supply to rise, as the risk of mine
supply disruptions ease after a strike was avoided at Teck's
Highland Valley Mine. The three-month forward LME copper contract
was down 0.2%.
Chinese iron-ore futures were higher in early trade amid
expectations of increased steel production after the Lunar New
Year, said Goldman Sachs.
"With no material policy constraints in place for steel
production this year, the normal post-CNY seasonal ramp up in steel
mill output is set to play out," it said.
It forecasts China's steel output to rise to 242 million tons in
1Q and 269 million tons in 2Q, compared with 211 million tons in 4Q
2021. The likely higher steel production should in turn lift demand
for iron ore. The most-traded May iron-ore contract rose 2.0%
TODAY'S TOP HEADLINES
Analysis: Why the Fed Is Unlikely to Start Raising Rates With a
Market speculation around whether the Federal Reserve might
raise interest rates by a half percentage point, instead of a
quarter point, at its March meeting has picked up in recent weeks.
Hedge-fund manager Bill Ackman called for such a "shock and awe"
move recently, as did Henry Kaufman, the former chief economist at
While the Fed isn't likely to rule out a half-percentage-point
increase as an instrument in its tool kit, the central bank is
unlikely to begin any sequence of rate rises with such a move, in
part because it would essentially concede that it had made a policy
Investors Pile Into Gold, Seeking Safety From Market,
One asset holding up through the early 2022 market turmoil:
Rising geopolitical tensions in Europe and a slide in major U.S.
stock indexes has sent investors rushing into the haven metal. On
Friday, they poured a record net $1.6 billion into SPDR Gold
Shares, the world's largest physically backed gold exchange-traded
fund, according to Dow Jones Market Data. When individuals buy
shares of an ETF backed by physical gold, they are buying a stake
in a trust. The ETF tracks the metal's price since the asset held
by that trust is metal.
Chip Shortage Leaves U.S. Companies Dangerously Low on
Semiconductors, Report Says
WASHINGTON-U.S. manufacturers and other companies that use
semiconductors are down to less than five days of inventory for key
chips, the Commerce Department said Tuesday, citing the results of
a new survey.
In 2019, companies typically maintained 40 days of inventory for
key chips, according to the Commerce Department report. Now for the
same chips-defined as 160 products that companies identified as
being the most challenging to acquire-companies are operating with
fewer than five days of inventory, the report said.
Imports Drop at Southern California Ports as Ship Backup
Imports are tumbling at the nation's busiest container port
complex even as the backup of ships waiting to unload there breaks
AMC in Advanced Talks to Refinance Debt as Meme-Stock Luster
AMC Entertainment Holdings Inc. is stepping up its efforts to
refinance some of its debt as the cinema chain's shares and bonds
have slumped, giving up most of their gains since the company
became a meme-stock favorite.
AMC is in advanced refinancing talks with multiple interested
parties, according to people familiar with the matter who said the
company has options to lower its interest burden and stretch out
maturities by several years.
Inflation, Supply Chain, Omicron Expected to Take a Bigger Toll
on Global Growth
WASHINGTON-The pace of economic growth both in the U.S. and
globally is likely to decline more sharply than previously
expected, the International Monetary Fund says in its latest
forecast, citing inflation, fallout from the Omicron variant and
chronic supply-chain problems.
Companies Prepare for Fallout From Cyberattacks Against
Businesses including utilities, manufacturers and
financial-services companies are bracing for potential spillover
from cyberattacks against Ukraine, as U.S. officials warn of
Russia-linked hacks that could ripple outward across borders and
Many companies are examining their ties to Ukrainian businesses,
as well as vendors with footprints in the country, as they shore up
computer systems against digital campaigns that could accompany a
Russian military advance into the country.
EU, U.K. Drop Border Travel Restrictions, Lessening Burden of
LONDON-The European Union is lifting Covid-19 travel
restrictions, allowing member countries to do away with quarantine
and testing for vaccinated fliers traveling inside the bloc.
While the Omicron variant is still spreading across the
continent, officials said the recent wave has reached a level at
which travel restrictions may not help curb its footprint
Why Calling the Bottom on Credit Suisse Is Tricky
Company turnarounds can be very rewarding for investors, but
they need perfect timing or nerves of steel to ride out the early
bumps. Credit Suisse seems intent on testing its shareholders'
On Tuesday, the beleaguered Swiss lender warned that additional
litigation provisions and more subdued trading meant it only broke
even in the quarter through December, excluding an already
announced goodwill write-down of 1.6 billion Swiss francs,
equivalent to $1.75 billion. The most worrying news was that its
international wealth management business-its strategic focus and
crown jewel-had net asset outflows in the period.
U.S. Plans Sanctions, Export Controls Against Russia if It
The U.S. is prepared to impose export controls on critical
sectors of the Russian economy if Russian President Vladimir Putin
invades Ukraine, and is working to soften market shocks if Russia
withholds energy supplies in retaliation, officials said.
Taking a page out of the Trump administration playbook to
pressure Chinese telecom giant Huawei Technologies Co., senior
administration officials on Tuesday said the U.S. could ban the
export to Russia of various products that use microelectronics
based on U.S. equipment, software or technology.
Oil Price Rise Blamed in Part on OPEC, Russian Output
OPEC and its Russia-led partners have promised to increase oil
production to pre-pandemic levels this year but are falling short
of those public commitments, stoking fast-rising global crude
Last month, the Organization of the Petroleum Exporting
Countries and its Russia-led allies increased their collective
production by 250,000 barrels a day, or 60% of what the two groups
promised for the month, according to the International Energy
Agency. Overall, the group is pumping 790,000 barrels a day below
its publicly stated targets, said the Paris-based watchdog, which
advises industrialized nations on energy.
Microsoft Earnings Grew Last Quarter With Demand for Cloud
Microsoft Corp. said its earnings continued to grow last quarter
as its cloud-services business stayed strong.
On Tuesday, the Redmond, Wash., software giant said its sales in
the quarter ended in December hit $51.7 billion, up 20% from a year
earlier. Its net income rose 21% to $18.8 billion.
Supply-Chain Software Provider o9 Solutions Valued at $2.7
Supply-chain software provider o9 Solutions Inc. has raised a
new round of private funding that has more than doubled the
Dallas-based company's value to $2.7 billion in less than two
O9 said it received a $295 million equity investment from
growth-equity firm General Atlantic, its climate-focused investment
strategy BeyondNetZero and Generation Investment Management, a
sustainability investor co-founded by former Vice President Al
Gore. The latest funding comes as more companies focus on
Canadian National Railway Names New CEO, Averts Proxy Fight
Canadian National Railway Co. named a new chief executive
officer and made changes to its board Tuesday, moves that will
allow the railroad operator to avert a proxy fight.
The Canadian railroad operator named longtime railroad executive
Tracy Robinson as CEO and president. Also, U.K.-based activist TCI
Fund Management Ltd. agreed to drop its proxy contest at Canadian
National, which named a new independent director and plans to
appoint two new independent directors with North American railroad
experience by its annual meeting.
Write to firstname.lastname@example.org
Expected Major Events for Wednesday
00:01/UK: Jan REC JobsOutlook survey
07:00/EU: Dec New Commercial Vehicle Registrations in Europe
statistics (EU27 + EFTA3)
07:00/DEN: Dec Retail Sales Index
07:00/SWE: Dec PPI
07:00/SWE: Dec Foreign trade
07:45/FRA: Jan Consumer confidence survey
09:00/ITA: Dec Foreign Trade non-EU
09:00/POL: Dec Unemployment
11:00/FRA: 4Q Claimant count and job advertisements collected by
13:00/POL: Dec Broad money M3
All times in GMT. Powered by Kantar Media and Dow Jones.
Write to us at email@example.com
We offer an enhanced version of this briefing that is optimized
for viewing on mobile devices and sent directly to your email
inbox. If you would like to sign up, please go to
This article is a text version of a Wall Street Journal
newsletter published earlier today.
(END) Dow Jones Newswires
January 26, 2022 00:32 ET (05:32 GMT)
Copyright (c) 2022 Dow Jones & Company, Inc.