EIA Weekly Petroleum Status Report; FOMC rate decision and
projections; Canada New Housing Price Index
Today's Top Headlines/Must Reads:
- What to Watch From the Fed Meeting
- Bank Failures Train Spotlight on Shortcomings in Risk
- Apple, Microsoft Dominate U.S. Markets After FAANG Trade
- First Republic Bank Taps Lazard for Help With Review of
- How the Last-Ditch Effort to Save Silicon Valley Bank
Follow WSJ market coverage here
Stock futures dipped on Wednesday as traders eyed the difficult
rate-setting choice facing the Federal Reserve.
Futures markets are pricing in an 89% probability of a 25 basis
point hike to a range of 4.75% to 5%.
"There'll be plenty of focus on whether the Fed hikes today, but
just as important will be how they're looking at the current
turmoil and whether they still expect any more rate hikes after
today," Deutsche Bank said.
"Our U.S. economists think that the [European Central Bank's]
decision last week offers a relevant blueprint for the Fed: raise
rates in line with expectations, drop forward guidance, but signal
a continued tightening bias," Deutsche added.
Across the pond, the U.K. inflation data showed price rises
accelerating again and remaining in double digits. The Bank of
England will deliver its rate decision Thursday.
"As inflation remains well above the BoE target, there's now a
stronger case for the BoE to press ahead with a rate hike, even in
a period of greater financial market uncertainty," Moneyfarm
"It will be interesting to see how the BoE and the Fed consider
the dynamics between fighting inflation and managing financial
stability. The ECB has already indicated that it sees no
contradiction between those two goals," Moneyfarm added.
Stocks to Watch
Array Technologies was down 2.2%. It reported fiscal
fourth-quarter profit and revenue that beat analysts'
Diebold Nixdorf said that it secured $55 million in additional
funds to support its near-term goals. Shares rose 40% in
First Republic Bank rose 1.6% in premarket trading. The stock
fell in after-hours trading Tuesday following a report from The
Wall Street Journal that said the regional lender this week had
hired Lazard to help with a review of strategic options that could
include a sale, and tapped consultant McKinsey to assist with the
bank's post-crisis structure.
GameStop said cost-cutting measures helped it record its first
quarterly profit after seven consecutive quarters of losses. Shares
rose almost 40% in premarket trading.
Luminar Technologies fell 7.9% to $7.12 after shares of the
lidar company were downgraded to Sell from Neutral at Goldman Sachs
with a price target of $5, the Fly reported.
Nike reported quarterly earnings and sales that beat Wall Street
expectations but shares declined 1.6% in premarket trading as gross
Telesis Bio issued 2023 revenue guidance above estimates. Shares
rose 10% in after-hours trading.
Fitch expects global market volatility to continue despite the
government-brokered deal for UBS to acquire Credit Suisse likely
easing concerns about a broader financial contagion.
"Investors and depositors are still trying to understand the
magnitude of risks to the banking sector and...will remain jittery
in the near term."
The rescue agreement, while positive, highlights the fragility
of the banking sector and regulators' willingness to backstop
additional risks, Fitch said.
The urgency of the deal also shows that despite regulators
reaffirming Credit Suisse's capital position, they weren't certain
the bank would be able to stem the loss of confidence, which could
pose a more systemic risk, Fitch added.
The Fed's likely hike of interest rates by 25bps should help the
dollar recover, ING said.
However, the decision is "a close call," and dollar gains may be
limited by the improved sentiment, ING added.
"There is room for the dollar to recover some ground on the back
of a moderate hawkish surprise by the Fed. However, we are
observing a gradual improvement in investor sentiment... which
makes us tilt to a bearish short-term bias in the dollar."
Sterling rose after U.K. inflation data was unexpectedly strong,
with headline annual CPI increasing by 10.4% in February.
Economists polled by The Wall Street Journal had expected CPI to
decline to 9.9%, from January's 10.1%.
Read U.K. Inflation Resumes Its Rise, Defying Expectations
Oil prices were weaker in Europe ahead of the Fed decision.
Base metals prices were mixed, while gold moved higher in early
London trading, as investors looked to the Fed rate decision.
Commonwealth Bank of Australia said the price of iron ore is
likely to retreat to $100 a metric ton by the fourth quarter,
pulled lower by soft Chinese steel demand.
"Current policy settings suggest that China's steel demand
impulse should ease through 2023."
Although, financial turmoil in advanced economies could prompt
China to direct more stimulus to infrastructure if its own annual
growth target comes under threat, which would be positive for
iron-ore prices, CBA said.
TODAY'S TOP HEADLINES
First Republic Bank Taps Lazard for Help With Review of
First Republic Bank is beefing up its adviser ranks as the
troubled lender seeks to stay afloat and plan for a postcrisis
future amid a trans-Atlantic crisis of confidence in the banking
The California bank this week tapped Lazard Ltd. to help with a
review of strategic options that could include a sale, a capital
infusion or asset trimming, according to people familiar with the
matter. It also hired consulting firm McKinsey & Co. to help
map out a postcrisis structure for the bank, the people said.
How the Last-Ditch Effort to Save Silicon Valley Bank Failed
Depositors were draining their accounts via smartphone apps and
telling their startup networks to do the same. But inside Silicon
Valley Bank, executives were trying to navigate the U.S. banking
system's creaky apparatus for emergency lending and to persuade its
custodian bank to stay open late to handle a multibillion-dollar
The depositors won the race. Regulators shut down SVB around the
time a multibillion-dollar cash infusion was set to arrive, marking
the second-largest bank failure in U.S. history.
Silicon Valley Bank's Former Parent Says FDIC Seized About $2
Billion of Its Cash
Silicon Valley Bank's former parent company can't access about
$2 billion that it had deposited at the failed bank, after
regulators froze the company's accounts and are exploring whether
it should help shoulder costs associated with the bank's
Lawyers for SVB Financial Group, the holding company that used
to control the now-defunct bank, claimed during the company's first
hearing in bankruptcy court on Tuesday that the Federal Deposit
Insurance Corp. has improperly blocked access to cash stored in
accounts it holds at the successor to Silicon Valley Bank.
TikTok CEO Shou Zi Chew Promises Firewall to Shield User
WASHINGTON-TikTok CEO Shou Zi Chew plans to offer a series of
broad promises on platform safety and security at a
much-anticipated congressional hearing on Thursday, according to
Mr. Chew will pledge to keep safety on Chinese-owned TikTok a
top priority-especially for teenagers-and also will promise to
firewall U.S. user data from foreign access and keep the platform
free from government interference.
Ares Forms $1 Billion Credit Secondary Venture With Mubadala
Ares Management Corp. and Mubadala Investment Co. have formed a
joint venture to buy secondhand stakes in private-credit funds.
The partnership, anchored by the Abu Dhabi-based
sovereign-wealth fund, will initially invest around $1 billion in
deals involving portfolios acquired from investors in private funds
and deals instigated by fund managers, according to a statement
seen by The Wall Street Journal. The amount of capital made
available for investment will increase as the credit secondary
market expands, the statement said.
GameStop Shares Surge After It Posts Surprise Profit
GameStop Corp. shares surged more than 40% after the retailer
said cost cutting helped it record its first quarterly profit after
seven consecutive quarters of losses.
GameStop has been working to turn around its business for close
to two years under the leadership of a revamped executive team and
board of directors.
Nike Sales Jump as It Works Through Inventory Glut
Nike Inc. made progress working through the inventory glut that
squeezed the sneaker maker last year, reporting a 14% jump in
quarterly sales and raising its revenue growth target.
The sportswear company said its inventory increased 16% in the
quarter ended Feb. 28 compared with the same period a year ago.
Inventories had swelled by more than 40% in each of the prior two
What to Watch From the Fed Meeting
The Federal Reserve faces on Wednesday one of its thorniest
policy decisions in years: whether to lift interest rates again to
fight high inflation or hold them steady amid the most intense
banking crisis since 2008.
The central bank will announce its decision at 2 p.m. Eastern
time in a statement. Officials are also scheduled to release new
interest-rate and economic projections. Fed Chair Jerome Powell is
set to answer questions from reporters at 2:30 p.m. ET.
Bank Failures Train Spotlight on Shortcomings in Risk
As banks and regulators scurry to respond to the most perilous
industry conditions since the 2007-08 financial crisis, experts say
one persistent issue needs attention: risk oversight that's not
always up to the job.
Board-level risk committees at many banks have neither the clout
nor the expertise to push back against corporate leadership, risk
professionals say, a weakness that should be addressed in the wake
of the recent bank collapses.
Apple, Microsoft Dominate U.S. Markets After FAANG Trade
The FAANG era is apparently over. The U.S. market is dominated
by just two stocks now.
U.K. Inflation Resumes Its Rise, Defying Expectations
LONDON-Britain's inflation is proving stubbornly high.
Price increases in February picked up to 10.4% from 10.1% in
January as the cost of food rose at the fastest pace since records
began in 1989.
North Korea Fires Off Several Cruise Missiles
SEOUL-North Korea fired several cruise missiles on Wednesday,
continuing its spree of weapons tests in response to ongoing joint
military drills by the U.S. and South Korea.
Several cruise missiles were fired at 10:15 a.m. local time from
the northeastern city of Hamhung, the military in Seoul said. The
missiles landed in waters between Korea and Japan.
Donald Trump Grand Jury to Reconvene as Potential Indictment
The Manhattan grand jury investigating Donald Trump's role in a
hush-money payment to a porn star is set to meet Wednesday as it
comes closer to voting on a potential indictment of the former
The grand jury's activities have been closely watched as the
hush-money investigation into Mr. Trump, run by Manhattan District
Attorney Alvin Bragg Jr., nears its end. On Wednesday, jurors could
hear from additional witnesses or prosecutors could formally
present charges, which is the final step before the jurors vote
whether to indict.
Trump Challenge Prompts Stay of Order on Lawyer's Testimony
WASHINGTON-Donald Trump is challenging a recent court decision
that paved the way for federal investigators to elicit potentially
crucial grand jury testimony from one of the former president's
lawyers as part of the special counsel inquiry into the handling of
classified documents at Mar-a-Lago.
At the request of Mr. Trump's legal team, a three-judge
appeals-court panel in Washington put a temporary halt Tuesday on a
sealed ruling that rejected attorney-client privilege claims raised
by the former president's lawyer, Evan Corcoran, during a grand
jury appearance in January. The panel of the U.S. Court of Appeals
for the D.C. Circuit set extraordinarily tight deadlines for
additional information and arguments, ordering Mr. Trump's lawyers
to file a briefing by midnight and special counsel Jack Smith's
team to respond by 6 a.m. Wednesday.
Kevin McCarthy Boasts of GOP Unity, but Tests Loom on Spending
ORLANDO, Fla.-For House Speaker Kevin McCarthy, it could be the
calm before another political storm.
At House Republicans' retreat, Mr. McCarthy projected a unified
picture of a party seeking conservative wins as well as
bipartisanship, pointing to votes on issues related to crime and
the Covid-19 pandemic. But he now heads into tough challenges that
will test his leadership, including how deeply to try to cut
government spending as a condition for raising the debt ceiling, as
well as how to handle the re-emergence of former President Donald
Trump as a center of attention in the party.
Japanese Premier Visits Kyiv as Ukraine War Divides Asia
Japanese Prime Minister Fumio Kishida held talks with Ukrainian
President Volodymyr Zelensky in Kyiv on Tuesday, in a supportive
visit that coincided with Chinese leader Xi Jinping's trip to
Moscow and the U.S. rush to provide tanks and missile defense
systems to Ukraine.
Mr. Kishida's visit to the Ukrainian capital illustrated how the
war in Ukraine is affecting geopolitical alignments in Asia. It was
the first by a Japanese leader since Russia invaded its neighbor in
February 2022, and the first by a Japanese premier to a country at
war since World War II. While Japan has supported Ukraine
diplomatically and with financial aid, it hasn't provided it with
lethal weapons, unlike all the other fellow members of the Group of
Seven advanced economies that Tokyo currently leads, because of
Japan's longstanding restrictions on arms sales.
Write to email@example.com TODAY IN CANADA
AGF Mgmnt 1Q
Boyd Grp 4Q
ECN Capital 4Q
Propel Hldgs 4Q
Economic Calendar (ET):
0830 Feb New Housing Price Index
1330 Bank of Canada summary of monetary policy deliberations
Stocks to Watch:
DATA Communications Mgmt 4Q Rev C$73M; 4Q EPS C$0.08
Dialogue Health 4Q Rev C$23.5M; 4Q Loss/Shr C$0.06; Sees 1Q Rev
K-Bro Linen 4Q Net C$280,000
Vecima Selected by Charter Commun to Enable 10G Services Over
Expected Major Events for Wednesday
06:00/JPN: Feb Revised Machine Tool Orders
07:00/UK: Feb UK producer prices
07:00/UK: Feb UK monthly inflation figures
08:59/JPN: Mar Monthly Economic Report
09:30/UK: Jan UK House Price Index
10:00/ITA: Jan Balance of Payments
11:00/UK: Mar CBI Industrial Trends Survey
11:00/US: 03/17 MBA Weekly Mortgage Applications Survey
12:30/CAN: Feb New Housing Price Index
14:30/US: 03/17 EIA Weekly Petroleum Status Report
18:00/US: Federal Reserve economic projections
18:00/US: U.S. interest rate decision
All times in GMT. Powered by Onclusive and Dow Jones.
Expected Earnings for Wednesday
AGF Management Ltd - Class B (AGF.B.T) is expected to report
$0.32 for 1Q.
Accord Financial (ACD.T) is expected to report for 4Q.
Aeva Technologies Inc (AEVA) is expected to report for 4Q.
Akita Drilling (AKT.A.T,AKT.B.T,AKTAF,AKTBF) is expected to
report for 4Q.
Arlington Asset Investment Corp (AAIC) is expected to report
$0.04 for 4Q.
Assembly Biosciences Inc (ASMB) is expected to report $-1.11 for
Astria Therapeutics Inc (ATXS) is expected to report for 4Q.
Avalo Therapeutics Inc (AVTX) is expected to report for 4Q.
Avalon Holdings (AWX) is expected to report for 4Q.
Boyd Group Services Inc (BYD.T) is expected to report for
Cathedral Energy Services (CET.T) is expected to report for
Clovis Oncology Inc (CLVSQ) is expected to report $-1.72 for
Codiak BioSciences Inc (CDAK) is expected to report for 4Q.
Cyclerion Therapeutics Inc (CYCN) is expected to report for
Fathom Holdings Inc (FTHM) is expected to report for 4Q.
Golden Minerals (AUMN,AUMN.T) is expected to report for 4Q.
Harpoon Therapeutics Inc (HARP) is expected to report $-0.47 for
Logistec Corp - Class A (LGT.A.T,LGT.B.T) is expected to report
Lyra Therapeutics Inc (LYRA) is expected to report for 4Q.
Natural Gas Services (NGS) is expected to report $-0.02 for
Neptune Wellness Solutions Inc (NEPT,NEPT-T) is expected to
report for 3Q.
NexImmune Inc (NEXI) is expected to report for 4Q.
Ollieâ tms Bargain Outlet Holdings Inc (OLLI) is expected to
report $0.80 for 4Q.
Oncorus Inc (ONCR) is expected to report for 4Q.
Palisade Bio Inc (PALI) is expected to report for 4Q.
Pennsylvania Real Estate Investment Trust (PRET) is expected to
report for 4Q.
Peraso Inc (PRSO) is expected to report for 4Q.
Petco Health & Wellness Co Inc (WOOF) is expected to report
Quarterhill Inc (QTRH,QTRH.T) is expected to report $-0.07 for
Reading International Inc (RDI) is expected to report $0.10 for
Shoe Carnival (SCVL) is expected to report $0.78 for 4Q.
Spectrum Pharmaceuticals (SPPI) is expected to report $-0.11 for
Talaris Therapeutics Inc (TALS) is expected to report for
Tattooed Chef Inc (TTCF) is expected to report for 4Q.
Terns Pharmaceuticals Inc (TERN) is expected to report for
Travelzoo (TZOO) is expected to report for 4Q.
TuSimple Holdings Inc (TSP) is expected to report for 4Q.
US Global Investors (GROW) is expected to report for 2Q.
Wilhelmina International Inc (WHLM) is expected to report for
Winnebago Industries Inc (WGO) is expected to report $1.19 for
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ANALYST RATINGS ACTIONS
Agree Realty Cut to Market Perform From Market Outperform by JMP
Armstrong World Cut to Hold From Buy by Deutsche Bank
Assurant Raised to Outperform From Market Perform by Keefe,
Bruyette & Woods
Athenex Cut to Neutral From Buy by Ladenburg Thalmann
Cyclo Therapeutics Cut to Hold From Buy by Maxim Group
Emerson Electric Raised to Overweight From Equal-Weight by
FleetCor Raised to Outperform From Market Perform by Raymond
Foot Locker Raised to Buy From Neutral by Citigroup
Foot Locker Raised to Outperform From In-Line by Evercore ISI
Foot Locker Raised to Outperform From Market Perform by Telsey
GoDaddy Cut to Neutral From Overweight by Piper Sandler
Harley-Davidson Raised to Overweight From Equal-Weight by Morgan
Meta Platforms Raised to Overweight From Equal-Weight by Morgan
Nvidia Raised to Neutral From Underperform by Exane BNP
NY Community Bancorp Raised to Buy From Hold by DA Davidson
Oak Street Health Cut to Peer Perform From Outperform by Wolfe
Oric Pharmaceuticals Cut to Neutral From Buy by Guggenheim
Range Resources Raised to Buy From Hold by Tudor Pickering
Vornado Raised to Neutral From Underweight by Piper Sandler
This article is a text version of a Wall Street Journal
newsletter published earlier today.
(END) Dow Jones Newswires
March 22, 2023 06:18 ET (10:18 GMT)
Copyright (c) 2023 Dow Jones & Company, Inc.