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Todays Open Interest Change

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Kristalina Georgieva, managing director of the International Monetary Fund, projected global growth to remain around 3% over the next five years, marking the weakest medium-term growth projection since 1990 and well below the 3.8% average from the past two decades. “With rising geopolitical tensions and still-high inflation, a robust recovery remains elusive,” Georgieva said in a recent speech in Washington. That's on top of the recent pressures in the banking sector that have made the global inflation fight that much more complex, she added.

Dig deeper: The sub-3% growth this year is generally consistent with the 2.9% estimated in January and the 2.7% estimate in October. Advanced economies are expected to weigh the most on global growth, particularly in the U.S. and Europe where rising borrowing costs have hampered demand. The IMF sees some 90% of advanced economies posting a decline in their growth rate in 2023. By contrast, emerging economies are a "bright spot" as India and China together are expected to account for 50% of this year's global growth.

Inflation fight: Georgieva took note of central banks' inflation fight in the wake of global banking issues, imploring them to "stay the course" in lowering inflation as long as financial pressures stay limited. While she implied that central banks should keep monetary policy restrictive until price stability is achieved, she urged them to "address financial stability risks when they emerge through appropriate provision of liquidity". However, if turmoil in the banking system worsened, she said central banks may have to outright cut rates.

Fed watch: Friday's payrolls report indicated that jobs growth rate is cooling, but the unemployment rate showed a tighter labor market. Traders believe the report locks in a 25-basis point rate hike by the Federal Reserve in May. Fed funds futures are now pricing in ~67% chance of a 25-basis point increase, compared with ~50% probability before the report.

SA commentary: Mott Capital Management, leader of Investing Group 'Reading The Markets', said the jobs data eliminated the odds of a rate cut in June. "The data that the Fed is focused on, such as jobs and inflation data, does not support the Fed's rate-hiking cycle being over or for rate cuts," he said. "On the other hand, survey data supports that the Fed is done with rate hikes and suggests a substantial economic slowdown is occurring." (22 comments)

Antitrust concerns

Sen. Elizabeth Warren (D-MA) and three Democrat lawmakers request that the U.S. Dept. of Justice investigate the Warner Bros. Discovery (WBD) merger over alleged anticompetitive behavior a year after it was completed. "Antitrust laws seek to promote consumer choice, product variety, and industry innovation," Warren - along with Joaquin Castro (D-TX), David Cicilline (D-RI) and Pramila Jayapal (D-WA) - wrote in a letter to the DOJ on Friday. "Accordingly, if a consummated merger results in dramatically less available content and discourages innovation, the merger should be reassessed." The representatives claim the Warner Bros. Discovery deal has reduced consumer choice and harmed workers in affected labor markets. The company was created a year ago when Discovery combined with AT&T's (T) WarnerMedia unit. Seeking Alpha contributor Eric Sprague believes Warner Bros. Discovery's stock is reasonably valued. "WBD has rightsized content investments after recognizing that not all content should be treated equally. Forward-looking investors should tune in for the April 12 press event that will showcase the new product offering for streaming." (260 comments)

Megapack factory

Tesla (TSLA) plans to build a new factory in Shanghai to produce its Megapack large-scale energy unit. The electric vehicle maker made the announcement at a signing ceremony for the project in Shanghai yesterday. The new factory will be able to produce 10K Megapacks a year. Tesla CEO Elon Musk tweeted that the new Shanghai factory will supplement output of the Megapack plant in California. Construction on the new Shanghai factory is expected to start in the third quarter and production will begin in the second quarter of 2024. The factory will be the automaker's second in Shanghai as it already has a facility where it manufactures its EVs. Tesla cut prices on all U.S. models late Thursday. The prices of Model 3 and Model Y were trimmed by at least $1,000, while prices of Model S and Model X were cut by $5,000 or more. Citi believes Tesla's price cuts will put even greater emphasis on its gross margins for Q1. Danil Sereda, Investing Group leader of 'Beyond the Wall Investing', thinks Tesla's latest delivery numbers show overproduction problems and demand side will likely get weaker in the foreseeable future. (85 comments)

Dissent over legality

The battle over the abortion pill is likely headed to the U.S. Supreme Court after two federal judges on Friday offered differing opinions in the legality of the drug. First, Texas-based U.S. District Judge Matthew Kacsmaryk on Friday suspended the Food and Drug Administration's approval of mifepristone. His decision is essentially an injunction preventing sales of the drug while a case before him, brought by anti-abortion groups, on the approval of the drug continues. However, a matter of hours after the Texas ruling, Washington State District Judge Thomas Rice ruled that the FDA needs to continue "the status quo" with respect to access to mifepristone. Kacsmaryk gave the Biden administration a week to appeal the decision, during which the suspension will be delayed. In his ruling, Kacsmaryk said the FDA had made legal errors in its approval. Mifepristone, approved in 2000, also goes by the brand name Mifeprex. (147 comments)

Today's Markets

In Asia, Japan +0.4%. Hong Kong closed. China -0.4%. India flat.
In Europe, London closed. Paris closed. Frankfurt closed.
Futures at 6:30, Dow +0.1%. S&P flat. Nasdaq -0.1%. Crude +0.1% to $80.78. Gold -0.5% to $2017. Bitcoin +1.6% to $28,368.
Ten-year Treasury Yield -1 bp to 3.37%

Today's Economic Calendar

10:00 Wholesale Inventories (Preliminary)
12:30 PM Investor Movement Index

Companies reporting earnings today »

What else is happening...

Exxon (XOM) holds informal talks with Pioneer Natural (PXD) on potential mega-deal.

Aramco (ARMCO) maintains crude supply to Asian refiners despite production cut.

Teck (TECK) reiterates benefits of planned split, gets entrepreneur Lassonde's backing.

Ahead of Biden visit, Sunak says more work needed to restore Northern Ireland govt.

Premier cancer research event AACR kicks off this week, here's what to expect.

Apple (AAPL) slips as IDC says Mac shipments fell 40% amid PC weakness.

Emirates Telecom to pick up 50% stake in Uber's (UBER) Careem for $400M.

Baidu (BIDU) sues Apple (AAPL), app developers over bogus Ernie bot apps.

Tupperware Brands (TUP) stock tumbles on delisting risk, advisor engagement.

Netflix (NFLX) scores streaming eyeballs with 'You', Chris Rock comedy special.


Known to most as Uranium Pinto Beans, Jason has more than 15 years under his belt of trading stocks, options and currencies. His expertise primarily lies in chart analysis, and he has a strong eye for undervalued stock. Because he’s got the ability to identify great risk/reward trades he usually enjoys taking the path less traveled and reaping the benefits from the adventure.

He is a co-founder of Option Millionaires, and he is best known for his weekly webinars with Scott, as well as his high level training webinars and charts found in the forums.

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