Conference Board's Employment Trends Index for January; earnings
from Tyson Foods, Activision Blizzard, Take-Two Interactive
Today's Headlines/Must Reads
- China Rebukes U.S. for Taking Down Its Balloon
- Upbeat Economic Data Keep Investors on Edge About Fed
- Banks Borrow Unsecured Cash at Record Clip
- U.S. Weighs Sanctions for Chinese Firms Over Iran Surveillance
- Chevron Explores Algerian Gas Plans Amid Russian Sanctions
- Newmont Proposes $17 Billion Takeover of Australia's Newcrest
- Public Storage Bids for Rival in Unsolicited $11 Billion
- Carlyle to Name Banking Veteran Harvey Schwartz as CEO
Follow WSJ markets coverage here .
Stock futures pointed to further losses for Wall Street on
Monday, after the unexpectedly strong jobs report renewed worries
about how high the Federal Reserve will have to take interest
"On the one hand, a resilient labor market could buttress
households' willingness and ability to continue consuming and
therefore support corporate earnings and equities over the near
term," BCA Research said.
But longer-term implications are more dire--if a second wave of
inflation is triggered, the Fed would have to act more forcefully,
perhaps leading to a deep recession, BCA Research said.
Traders also were reacting to the political rift between the
U.S. and China after Joe Biden ordered a balloon to be shot down.
China has said the balloon was to monitor the weather, not for
spying, and had been blown off course.
The Hang Seng dropped 2% on Monday, with China's Shanghai
Composite also lower.
Stocks to Watch
Dell will join the ranks of technology companies slashing jobs
as the computer maker will shed 6,650 positions, according to a
Bloomberg report on Monday, which cited a company spokesman after
seeing a memo.
Jeff Clarke, co-chief operating officer, told employees that the
current conditions will "continue to erode with an uncertain
The job cuts amount to 5% of its workforce, the report said.
Comera Life Sciences said its stockholders, including some board
members, can sell up to 7.2 million shares of common stock in the
company from time to time. Its stock rose 5% in after-hours
Jiuzi told the SEC it doesn't intend to proceed with the resale
of ordinary shares registered in its statement from Dec. 30, 2021.
Its stock jumped 26% in after-hours trading.
Newmont made a $17 billion, all-stock offer to buy Australia's
Newcrest Mining. Newmont shares fell 6% premarket.
RH on Friday said it has restated per-share earnings results
spanning the last three quarters after identifying errors in its
original calculations. Its shares fell 3% in after-hours
The dollar continues to gain after Friday's much
stronger-than-expected jobs data, reaching its highest in nearly
four weeks against a basket of currencies as the U.S. economy looks
more resilient and more rate rises look likely, MUFG said.
"Market participants have moved to price in a higher probability
of the Fed delivering at least two more 25bps hikes before pausing
their hiking cycle," MUFG said.
U.S. rate markets have scaled back expectations for rate cuts
beginning later this year, and thus the dollar has reversed most of
its losses sustained since the start of the year, MUFG said.
However, MUFG said the currency's strength may not be
"We do not expect the dollar's recent rebound to be the start of
a more sustained upward trend. The underlying trend for job growth
is still slowing but not fast enough to make the Fed comfortable
over upside risks to inflation from the tight labour market."
In the week ahead, market participants will be watching to see
how Fed officials react to the better data releases, MUFG said.
Bond markets are off to a strong start in 2023, running with the
downward inflation trend in the U.S., J.P.Morgan Asset Management
"As a result, bond demand has picked up and government bond
yields have rallied."
This has benefited JPM AM's preference for adding U.S. duration
at the beginning of the year, it said, adding that, in the near
term, inflation, wage and economic growth data may keep government
bond yields range bound.
"Ultimately, we prefer to remain structurally long U.S. duration
as we continue to see a 60% chance of the market pricing in a
recession later this year."
Oil prices were higher in Europe after an EU ban on Russian
refined products and a G-7 price cap on those products came into
force on Sunday.
The caps prevent shipping and insurance firms from trading
Russian refined products unless they are below a cap of $100 a
barrel for gasoline, diesel and jet fuel and $45 a barrel for
naphtha and fuel oil. The measures have been well-flagged and
Europe has built up strong stockpiles in recent weeks, limiting the
measures' hit on prices.
"EU buyers have had time to prepare for the ban," ING said.
Read Russia Sanctions Challenge Tight U.S. Diesel Market
Read Oil Industry's Windfall Fails to Excite Wall Street
Base metals prices were mixed, while gold was higher, with the
dollar still rising after the strong jobs report, hitting risk
"Any macro disappointment could lead to a short-term price
correction before seeing a sustained rise in prices," ANZ said, in
reference to industrial metals. It said gold is likely to face
headwinds for similar reasons.
TODAY'S TOP HEADLINES
Disney, Pepsi, Uber Set to Report During Lackluster Earnings
PepsiCo Inc., Uber Technologies Inc. and Walt Disney Co. are
among the companies slated to report earnings in the coming week,
during an earnings season marked by cooling demand and throttled
Investors will also hear from the food makers Kellogg Co. and
Tyson Foods Inc., the healthcare companies CVS Health Corp. and
AbbVie Inc., as well as the private-equity firms KKR & Co. and
Apollo Global Management Inc. Other companies reporting earnings
include PayPal Holdings Inc., S&P Global Inc. and Chipotle
Mexican Grill Inc.
Chevron Explores Algerian Gas Plans Amid Russian Sanctions
Oil giant Chevron Corp. is looking to seal an energy exploration
deal with Algeria, as the North African country steps up efforts to
replace sanctioned Russian supplies in nearby Europe, according to
people familiar with the matter.
Over the past decade, U.S. companies have pulled back from
operations in oil-and-gas-rich Middle Eastern and African countries
they viewed as politically risky to focus on booming shale
production at home.
Newmont Proposes $17 Billion Takeover of Australia's Newcrest
ADELAIDE, Australia-Newmont Corp. has made a roughly $17 billion
offer to acquire Australia's Newcrest Mining Ltd., aiming to seal
one of the biggest deals for a global gold miner as the industry
struggles to make large new discoveries of the precious metal.
Newmont, based in Colorado and one of the world's largest
producers of gold, submitted a conditional and nonbinding
indicative proposal to acquire Newcrest, Australia's largest listed
gold producer. Newmont said it would offer 0.380 of its own shares
for each Newcrest share held.
Public Storage Bids for Rival in Unsolicited $11 Billion
Public Storage has made an $11 billion unsolicited offer for
Life Storage Inc., ramping up an effort to buy its smaller rival
after an earlier bid was rejected.
Public Storage said it sent a letter to Life Storage's
management on Sunday detailing its all-stock proposal, worth about
$129 a share, confirming an earlier report by The Wall Street
Journal. Life Storage shares closed Friday at $110.58.
Carlyle to Name Banking Veteran Harvey Schwartz as CEO
Carlyle Group Inc. plans to name investment-banking veteran
Harvey Schwartz its new chief executive, according to people
familiar with the matter, as the private-equity firm's founders
seek a fresh start after a botched succession plan.
Carlyle is expected to unveil on Monday the appointment of Mr.
Schwartz, who most recently served as co-president of Goldman Sachs
Group Inc., the people said. He spent more than two decades at the
bank, building and leading various businesses.
Judge Releases Decision Approving Meta's Virtual-Reality
WASHINGTON-A judge has made public his decision that allowed
Meta Platforms Inc. to acquire a virtual-reality startup, providing
new details on why he ruled against the Federal Trade Commission in
its high-profile antitrust case against the Facebook parent
The ruling, which was initially sealed and was released late
Friday, rejected the FTC's arguments for why Meta's acquisition of
Within Unlimited was anticompetitive. But the judge sided with the
FTC on some legal and factual arguments, bolstering the agency's
ability to bring similar cases in the future, some antitrust
Paramount Reveals Plan to Remake Showtime in the Image of
Showtime is producing a wave of spinoffs and expansions for
"Billions" and "Dexter," two of its sturdiest hits, the network
says. The premium cable brand is reshaping its TV slate with the
same mold that turned "Yellowstone" into a sprawling franchise for
parent company Paramount Global.
Showtime says it's planning up to four series connected to
"Billions," the network's long-running high-finance drama, starting
with a spinoff set in Miami, plus other iterations being developed
under the titles "Millions" and "Trillions."
Oil Industry's Windfall Fails to Excite Wall Street
Oil companies delivered the market's best shareholder returns
last year, but Wall Street is still wary.
The biggest Western oil companies, Exxon Mobil Corp., Chevron
Corp. and Shell PLC, together cleared a record of more than $132
billion in annual profit in 2022 and handed investors $78 billion
via share buybacks and dividends, about 50% more than the last time
oil topped $100 a barrel in 2014.
For Elon Musk, Two Cases About His Tweets, and Two Victories
Twice Elon Musk has faced a jury over remarks he has made on
Twitter. And twice a jury has vindicated him.
The latest victory came Friday when a federal jury ruled in his
favor in a securities-fraud lawsuit in which investors alleged they
felt misled into losing money after his 2018 tweets claimed to have
"funding secured" to take Tesla Inc. private. Shares rose on the
news, then fell in the days after as it became clear he didn't have
such a deal for the car maker finalized.
Southwest Airlines to Reduce Minimum Requirements for Aspiring
Southwest Airlines Co. is reducing the number of hours
prospective pilots must have spent flying jets and other
turbine-powered aircraft, as the carrier looks to increase
Southwest had required applicants to have spent at least 1,000
hours flying such aircraft. It will now consider pilots with less
of that type of experience, and said it would list 500 hours of
"turbine time" as a preferred qualification. The change is set to
go into effect Feb. 7, according to a message the airline sent to
pilots this week.
Upbeat Economic Data Keep Investors on Edge About Fed
The U.S. labor market remains incredibly strong. Investors can't
decide if that is a good or bad thing.
At first glance, Friday's jobs report seemed to have very little
for money managers to dislike. The U.S. economy added a whopping
517,000 jobs in January, while the unemployment rate fell to its
lowest level since 1969, according to Labor Department data.
Banks Borrow Unsecured Cash at Record Clip While Deposits
Banks were chasing away deposits during the depths of the
pandemic. Now, some are paying higher rates to shore up cash.
Borrowing in the federal-funds market hit $120 billion on Jan.
27, the highest one-day total in Federal Reserve data going back to
2016. Activity in fed funds-used by banks and government-backed
lenders to exchange cash reserves parked at the Fed-surged
throughout the past year when the central bank raised interest
rates at the fastest pace in decades.
U.S. Weighs Sanctions for Chinese Companies Over Iran
The U.S. is considering new sanctions on Chinese surveillance
companies over sales to Iran's security forces, officials familiar
with the deliberations said, as Iranian authorities increasingly
rely on the technology to crack down on protests.
U.S. authorities are in advanced discussions on the sanctions,
according to the officials, and have zeroed in on Tiandy
Technologies Co., a surveillance-equipment maker based in the
eastern Chinese city of Tianjin whose products have been sold to
units of Iran's Islamic Revolutionary Guard Corps, a hard-line
Russia Sanctions Challenge Tight U.S. Diesel Market
U.S. fuel markets held steady in December after Western
sanctions on Russian crude reshuffled global oil shipments. New
restrictions that take effect Sunday could prove more
The measures, which target most of Russia's refined petroleum
products, threaten to take supplies off the market as the country
looks for new trading partners. Any confusion could buoy prices for
diesel and other fuels that have remained stubbornly high since the
Kremlin launched its invasion of Ukraine last year.
Stock Funds Rose 7.8% in January
That's more like it.
Stock funds posted a positive January as the market advanced, a
respite for investors who endured a brutal, inflation-racked 2022
for both stocks and bonds. Though most people's 401(k) statements
are still too ugly to read (at least as far as recent performance)
it is a hopeful start to the new year.
States Are Flush With Cash, Which Could Soften a Possible
State governments are entering 2023 with record-high reserves,
which could help the overall economy weather a recession this
The rapid economic recovery from the pandemic combined with an
influx of federal stimulus money has filled public coffers,
allowing governments to squirrel funds away for emergencies.
The Retreat of the Amateur Investors
Amateur trader Omar Ghias says he amassed roughly $1.5 million
as stocks surged during the early part of the pandemic, gripped by
a speculative fervor that cascaded across all markets.
As his gains swelled, so did his spending on everything from
sports betting and bars to luxury cars. He says he also borrowed
heavily to amplify his positions.
What CEOs Are Saying: 2023 'Is the Year of Efficiency'
Here is what some of the world's corporate leaders said this
week about business and consumer spending, the supply chain and
January's Hiring Boom Caught Economists by Surprise. Why
Forecasts Often Miss the Mark.
January's surge in hiring caught economists off guard.
The Labor Department reported Friday that employers added
517,000 jobs to payrolls in January, after accounting for seasonal
movement, driven by increases in most industries, including
restaurants and healthcare.
China Rebukes U.S. for Taking Down Its Balloon
BEIJING-China's vice foreign minister lodged strong criticism of
the U.S. decision to shoot down a suspected surveillance balloon
over the weekend, calling it an indiscriminate use of force that
would further damage U.S.-China relations.
Vice Foreign Minister Xie Feng delivered the rebuke to the U.S.
Embassy in Beijing on Sunday, according to a statement published
Monday by the Chinese Foreign Ministry. The statement reiterated
China's position that the balloon was an unmanned civilian aircraft
that had drifted off course.
Billionaire Charles Koch-Backed Group Will Push GOP to Move Past
WASHINGTON-A group funded by billionaire Charles Koch will work
to support a Republican presidential nominee other than Donald
Trump, concluding in a strategy memo that "we need to turn the page
on the past."
The organization, Americans for Prosperity, has stayed out of
the last two presidential cycles but has concluded it needs to
engage now as Mr. Trump mounts his third consecutive White House
run. The memo released Sunday doesn't mention the former president
by name but is unambiguous in its purpose.
Classified-Documents Probe Highlights Biden Family's Deep Ties
The discovery of classified documents from Joe Biden's vice
presidency at a foreign-relations think tank might have surprised
many in the country. The fact that the think tank was run by the
University of Pennsylvania and bore the president's name shouldn't
For decades, the Ivy League school and the Biden family, across
generations, have fostered close relations to their mutual benefit.
Those benefits extend beyond the Penn Biden Center for Diplomacy
and Global Engagement, where the documents were discovered in
Biden Prepares for State of the Union Speech as China Tensions,
Job Gains Take Center Stage
WASHINGTON-President Biden will give the State of the Union
address before a newly divided Congress on Tuesday, hoping to build
off positive economic signs but facing fresh tensions with China
and the lingering war in Ukraine.
Following the speech, Mr. Biden will travel on Wednesday to
Wisconsin, a 2024 presidential battleground, and tout union jobs
during a visit to Madison. On Thursday he is scheduled to visit
Florida-the home of two potential 2024 GOP rivals, former President
Donald Trump and Gov. Ron DeSantis-to highlight plans to strengthen
Social Security and Medicare and reduce healthcare costs, the White
House said. On Friday he will discuss his economic agenda with the
nation's governors and meet with Brazilian President Luiz Inácio
Lula da Silva.
Hong Kong Opposition in Court as Landmark National-Security
HONG KONG-Sixteen pro-democracy figures went on trial Monday in
a landmark case in Hong Kong's crackdown on political dissent,
drawing global scrutiny as the city's government launches a
marketing blitz to restore the financial hub's allure to global
business and tourists.
The arrests of the 16 in January 2021, part of a larger roundup
that snared dozens of the city's most prominent politicians and
activists and effectively snuffed out legislative opposition in the
city, drew condemnation and sanctions from Washington and its
allies. Most of the 47 people charged in the case have been held in
prison for more than two years.
Moscow, Tehran Advance Plans for Iranian-Designed Drone Facility
Moscow and Tehran are moving ahead with plans to build a new
factory in Russia that could make at least 6,000 Iranian-designed
drones for the war in Ukraine, the latest sign of deepening
cooperation between the two nations, said officials from a country
aligned with the U.S.
As part of their emerging military alliance, the officials said,
a high-level Iranian delegation flew to Russia in early January to
visit the planned site for the factory and hammer out details to
get the project up-and-running. The two countries are aiming to
build a faster drone that could pose new challenges for Ukrainian
air defenses, the officials said.
Ukraine Warns Russia Is Planning Major Offensive as Kyiv Shakes
Up Military Leadership
DNIPRO, Ukraine-Ukraine warned that Russia was completing
preparations for a major new offensive this month as Kyiv signaled
a reshuffle in its military leadership amid a corruption scandal
that has rocked the Defense Ministry.
Serhiy Haidai, the governor of the Luhansk region in eastern
Ukraine, said Russia was continuing to bolster its offensive
capacity and bring in troops to front line positions while
decreasing its rate of fire in certain areas to save ammunition for
the coming advance.
More Russian Migrants Enter U.S. as Exceptions for Asylum
More Russian migrants are traveling through Mexico to seek
asylum in the U.S., driven in part by an expanding U.S. government
effort to allow more asylum seekers to cross the border
About 12,500 Russians entered the U.S. through ports of entry
with Mexico between October, the start of the government's budget
year, and December. Most are expected to ask for asylum once they
settle in the U.S., often citing government crackdowns since the
start of the war in Ukraine and the mobilization announced in
September to draft more troops.
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Coveo Solutions 3Q
Finning Intl 4Q
PrairieSky Royalty 4Q
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Economic Calendar (ET):
1000 Jan Ivey Purchasing Managers Index
Stocks to Watch:
BBTV Holdings Signs $16M Term Loan Agreement WIth MEP Capital
Holdings; $10M of Term Loan Committed, About $6M Conditional on 1H
Performance Target; BBTV to Use Loan for Working Cap, Pay out CAD
Overdraft Facility With Chartered Bank
Draganfly Signs Strategic Agreement With Remote Sensing
Instruments to Make Drones for Indian Market
International Petroleum to Acquire Cor4 Oil in Canada for $62
Million; Acquisition Includes Total Proved Plus Probable Reserves
of 15.9M Barrels of Oil Equivalent as of Dec. 31, 2022; Assets to
Be Acquired Have Forecast Average Net Production of Around 4,000
Barrels of Oil Equivalent a Day for 2023; Acquisition Is Expected
to Complete by the End of 1Q 2023
Expected Major Events for Monday
02:00/JPN: Jan Imported Vehicle Sales
07:00/GER: Dec Manufacturing orders
07:00/GER: Dec Manufacturing turnover
09:00/UK: Jan UK monthly car registrations figures
09:30/UK: Jan S&P Global / CIPS UK Construction PMI
15:00/CAN: Jan Ivey Purchasing Managers Index
15:00/US: Jan Employment Trends Index
23:30/JPN: Dec Household Spending
23:50/JPN: Jan International Reserves / Foreign Currency
23:50/JPN: Jan Provisional Trade Statistics for 1st 20 days of
All times in GMT. Powered by Onclusive and Dow Jones.
Expected Earnings for Monday
Activision Blizzard (ATVI) is expected to report $0.90 for
Affiliated Managers Group Inc (AMG) is expected to report $5.60
Alico (ALCO) is expected to report for 1Q.
Arrowhead Pharmaceuticals Inc (ARWR) is expected to report
$-0.15 for 1Q.
Art's Way Manufacturing (ARTW) is expected to report for 4Q.
BellRing Brands Inc (BRBR) is expected to report for 1Q.
CF Bankshares Inc (CFBK) is expected to report for 4Q.
CNA Financial Corp (CNA) is expected to report $0.95 for 4Q.
Cerence Inc (CRNC) is expected to report for 1Q.
Coffee Holding Co (JVA) is expected to report for 4Q.
Cummins Inc (CMI) is expected to report $4.76 for 4Q.
Daseke Inc (DSKE) is expected to report $0.07 for 4Q.
Enact Holdings Inc (ACT) is expected to report for 4Q.
Energizer Holdings Inc (ENR) is expected to report $0.76 for
Enterprise Group (E.T) is expected to report for 4Q.
Farmers & Merchants Bancorp Inc (FMAO) is expected to report
Fastenal Co (FAST) is expected to report.
Flexsteel Industries Inc (FLXS) is expected to report $0.03 for
Genworth Financial Inc (GNW) is expected to report $0.22 for
Gladstone Capital Corp (GLAD) is expected to report $0.24 for
Graham Corp (GHM) is expected to report $0.16 for 3Q.
Idexx Laboratories Inc (IDXX) is expected to report $1.94 for
Loews Corp (L) is expected to report for 4Q.
Mesa Labs (MLAB) is expected to report $0.03 for 3Q.
MexcoEnergy (MXC) is expected to report for 3Q.
NAPCO Security Technologies Inc (NSSC) is expected to report
$0.14 for 2Q.
NOV Inc (NOV) is expected to report for 4Q.
Neurocrine Biosciences Inc (NBIX) is expected to report $1.08
Nicholas Financial (NICK) is expected to report for 3Q.
ON Semiconductor Corp (ON) is expected to report $1.23 for
PetMed Express (PETS) is expected to report $0.20 for 3Q.
Pinterest Inc (PINS) is expected to report for 4Q.
Power Integrations (POWI) is expected to report $0.36 for
Security Federal Corp (SFDL) is expected to report for 4Q.
Skyline Champion Corp (SKY) is expected to report $0.98 for
Skyworks Solutions Inc (SWKS) is expected to report $2.05 for
Sonnet BioTherapeutics Holdings Inc (SONN) is expected to report
Timken Co (TKR) is expected to report for 4Q.
Tyson Foods (TSN) is expected to report $1.50 for 1Q.
United States Lime & Minerals Inc (USLM) is expected to
report for 4Q.
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ANALYST RATINGS ACTIONS
Align Technology Raised to Neutral From Sell by Goldman
Aptiv Cut to Peer Perform From Outperform by Wolfe Research
Bill.com Holdings Cut to Market Perform From Outperform by BMO
Bill.com Holdings Cut to Neutral From Buy by BTIG
Bill.com Holdings Cut to Neutral From Outperform by SMBC
Boeing Cut to Sector Perform From Outperform by RBC Capital
Boyd Gaming Raised to Buy From Hold by CBRE
Camden Property Trust Cut to Neutral From Overweight by Piper
Cardinal Health Raised to Outperform From Neutral by Baird
CH Robinson Worldwide Cut to Hold From Buy by Stifel
Cognizant Tech Solutions Cut to Neutral From Outperform by
ConocoPhillips Cut to Equal-Weight From Overweight by Capital
Cyteir Therapeutics Cut to Underweight From Equal-Weight by
Erasca Raised to Overweight From Equal-Weight by Morgan
Esperion Therapeutics Raised to Equal-Weight From Underweight by
First Foundation Cut to Neutral From Overweight by Piper
Focus Financial Partners Cut to Market Perform From Outperform
by BMO Capital
Generac Cut to Neutral From Buy by Guggenheim
HB Fuller Raised to Buy From Neutral by Citigroup
Hexcel Cut to Neutral From Buy by B of A Securities
Hilton Grand Vacations Cut to Hold From Buy by Jefferies
Immuneering Cut to Underweight From Equal-Weight by Morgan
International Paper Raised to Neutral From Sell by UBS
MACOM Technology Cut to Market Perform From Outperform by
Northland Capital Markets
Meta Platforms Cut to Reduce From Hold by HSBC
Minerals Technologies Cut to Neutral From Buy by Sidoti &
Neurocrine Raised to Overweight From Equal-Weight by Morgan
Nordstrom Raised to Hold From Reduce by Gordon Haskett
Sallie Mae Cut to Equal-Weight From Overweight by Wells
Spirit Aerosystems Cut to Sector Perform From Outperform by RBC
Stanley Black & Decker Cut to Neutral From Buy by Longbow
Stanley Black & Decker Raised to Neutral From Sell by
Synaptics Cut to Perform From Outperform by Oppenheimer
Travel + Leisure Cut to Hold From Buy by Jefferies
Upstart Holdings Cut to Hold From Buy by Loop Capital
This article is a text version of a Wall Street Journal
newsletter published earlier today.
(END) Dow Jones Newswires
February 06, 2023 06:02 ET (11:02 GMT)
Copyright (c) 2023 Dow Jones & Company, Inc.