Reads
- No Sign of Easing Oil Squeeze as Ministers Meet
- US Supreme Court to Hear Case Targeting Consumer Financial Watchdog
- The Fed Seeks to Up Its Influencer Status
- Fed’s Mester Says One More Rate Hike May Be Needed This Year
- Wall Street Thinks America’s Homes Are Overvalued
- Americans’ Growing Reluctance to Quit Their Jobs, in Five Charts
- A Plot to Oust the House Speaker Hits Weary Investors
- ‘Dumb Money’ Exposes the Baffling Allure of Bad Investment Advice
- Can AI Beat the Market? Wall Street Is Desperate to Try
- J.P. Morgan Growth Equity and Index Ventures Back Logistics Payment Platform Loop
- Brookfield Raises $12 Billion for Flagship Private Equity Fund
- Zoom’s Ex-CMO Will Now Pitch Hybrid Work as CEO of Video-Tech Firm Neat
- Meta Explores Charge for Ad-Free Instagram and Facebook. Its Model Is Under Threat
- From $26 Billion to Bust: Sam Bankman Fried’s Astonishing Rise and Fall
- U.S. Car Sales Expected to Increase Again in the Third Quarter
- China Is Suffering a Brain Drain. The U.S. Isn’t Exploiting It
- A Rural Michigan Town Is the Latest Battleground in the U.S.-China Fight
- China Evergrande Shares Soar as Trade Resumes Amid Police Probe
- Key Taiwan Tech Firms Helping Huawei With China Chip Plants
- Rare Look Inside TikTok Parent’s Finances Shows Slowing Revenue Growth
- Tiger Woods-Backed Golf League Signs Sponsorship Deal with SoFi
Open Interest Changes
PREMIUM
Prepper
As the legal battle over Google's (GOOG, GOOGL) alleged dominance continues, it looks like even the CEO of Microsoft (MSFT) resorts to using the search engine to start his day. “You get up in the morning, you brush your teeth and you search on Google,” Satya Nadella said on the stand on Monday at Google’s antitrust trial, referring to the dominance of the app.
Alarm bells: The tech executive warned about the advent of AI, which could allow Google's monopoly to strengthen further, as it could use the massive profits it makes from search to pay for exclusive rights to content it can use to improve its search AI. Despite investing $100B, Nadella testified that Microsoft’s rival search tool Bing is a “very, very low share player.” Microsoft executive Jonathan Tinter previously testified that the company was unable to seal a deal to add Bing on Apple (AAPL) products, even though it was offering better terms than Google. Even Microsoft’s own phone is required to use Google Search to license the Android mobile operating system.
Backdrop: The U.S. Department of Justice is accusing Alphabet’s search division of unlawfully maintaining a monopoly by paying $10B a year to make its search engine the default option. Google denies the allegations. The government is using the case of Bing and Microsoft's might behind it as evidence that even with massive resources, no one can trump Google. A decision in the case is not expected until next year.
SA commentary: Cavenagh Research pointed out the similarities with the Microsoft antitrust case of the late 1990s. "The judge will likely prohibit Google from having exclusive contracts with Apple and/or Android OEMs that require Google to be the default search engine," he predicted, but added that the trial is "quite insignificant" for Google's commercial success. Livy Investment Research also believes the risks from the trial are remote. "Instead, we are more concerned over recent findings disclosed from the trial, which suggest increasing risks of structural market share loss to rivals." (25 comments)
Reassuring outlook
Tesla (TSLA) turned around a premarket loss and moved into positive territory on Monday, closing up 0.6%, as investors sized up the Austin-based automaker's Q3 deliveries report. Tesla delivered 435,059 vehicles during Q3, missing expectations, on account of longer than expected downtimes for factory upgrades. Crucially, Tesla remains committed to the target of 1.8M deliveries for the year. Wedbush analyst Dan Ives said the downtimes may have shifted about 20K vehicle deliveries into Q4. Despite the sequential decline in deliveries, Seeking Alpha analyst Poonam Arora believes Tesla has high growth in revenues and earnings locked in for at least the next ten years. (46 comments)
Drilling in check
U.S. shale producers plan to keep drilling under wraps even if oil prices top $100/bbl, citing the need for financial discipline during what they see as President Joe Biden's "war" on fossil fuel production. Many companies cited the Biden administration's decisions to limit drilling on federal lands and waters as the main reason they are restricting investments, as well as ongoing permitting delays and often hostile rhetoric from the administration. "It's political power," asserted Continental Resources founder Harold Hamm. "They believe that is what their base wants." Note that U.S. shale companies reinvested most of their capital in production this year, although there are fewer active U.S. oil rigs. (71 comments)
Not misleading
In a win for the fast-food industry, U.S. District Judge Hector Gonzalez dismissed a lawsuit accusing both McDonald's (MCD) and Wendy's (WEN) of misleading customers in advertising about the size of their hamburgers. Judge Gonzalez ruled that he did not see proof that the fast-food chains delivered smaller burgers than advertised, or that the plaintiff had even seen ads for the McDonald's Big Mac and Wendy's Bourbon Bacon Cheeseburger that were the basis of the lawsuit. The ruling will likely improve the legal position of other chains such as Yum! Brands' (YUM) Taco Bell and Restaurant Brands' (QSR) Burger King, which are also facing similar lawsuits. (7 comments)
Today's Markets
In Asia, Japan -1.6%. Hong Kong -2.7%. China +0.1%. India -0.5%.
In Europe, at midday, London +0.4%. Paris -0.2%. Frankfurt -0.3%.
Futures at 6:30, Dow +0.1%. S&P +0.1%. Nasdaq flat. Crude -0.1% to $88.72. Gold -0.3% at $1,841.90. Bitcoin -2.6% to $27,588.
Ten-year Treasury Yield +1 bp to 4.70%.
Today's Economic Calendar
Auto Sales
8:00 Fed's Bostic: "Economic Outlook for 2024: Inflation, Rising Interest Rates, Labor Market, and Uncertainties"
10:00 Job Openings and Labor Turnover Survey
Companies reporting earnings today »
What else is happening...
WSB survey results: Most readers are not stressed by student loans.
Delta Air (DAL) is latest carrier to find fake aircraft engine parts.
Biden admin gives China heads up on chip export curb expansion.
GM (GM), Stellantis (STLA) may face $9.5B in fuel economy fines.
JPMorgan's Dimon sees AI allowing 3.5-day workweek in future.
Pentagon's F-35 fighter jet program just got more expensive.
Drugmakers comply with Medicare pricing talks despite lawsuits.
Cleveland Fed's Loretta Mester sees one more rate hike this year.
Novo Nordisk (NVO) gains after winning Wegovy patent challenge.
WeWork skips $95M interest payments, eyes negotiating with lenders.
As the legal battle over Google's (GOOG, GOOGL) alleged dominance continues, it looks like even the CEO of Microsoft (MSFT) resorts to using the search engine to start his day. “You get up in the morning, you brush your teeth and you search on Google,” Satya Nadella said on the stand on Monday at Google’s antitrust trial, referring to the dominance of the app.
Alarm bells: The tech executive warned about the advent of AI, which could allow Google's monopoly to strengthen further, as it could use the massive profits it makes from search to pay for exclusive rights to content it can use to improve its search AI. Despite investing $100B, Nadella testified that Microsoft’s rival search tool Bing is a “very, very low share player.” Microsoft executive Jonathan Tinter previously testified that the company was unable to seal a deal to add Bing on Apple (AAPL) products, even though it was offering better terms than Google. Even Microsoft’s own phone is required to use Google Search to license the Android mobile operating system.
Backdrop: The U.S. Department of Justice is accusing Alphabet’s search division of unlawfully maintaining a monopoly by paying $10B a year to make its search engine the default option. Google denies the allegations. The government is using the case of Bing and Microsoft's might behind it as evidence that even with massive resources, no one can trump Google. A decision in the case is not expected until next year.
SA commentary: Cavenagh Research pointed out the similarities with the Microsoft antitrust case of the late 1990s. "The judge will likely prohibit Google from having exclusive contracts with Apple and/or Android OEMs that require Google to be the default search engine," he predicted, but added that the trial is "quite insignificant" for Google's commercial success. Livy Investment Research also believes the risks from the trial are remote. "Instead, we are more concerned over recent findings disclosed from the trial, which suggest increasing risks of structural market share loss to rivals." (25 comments)
Reassuring outlook
Tesla (TSLA) turned around a premarket loss and moved into positive territory on Monday, closing up 0.6%, as investors sized up the Austin-based automaker's Q3 deliveries report. Tesla delivered 435,059 vehicles during Q3, missing expectations, on account of longer than expected downtimes for factory upgrades. Crucially, Tesla remains committed to the target of 1.8M deliveries for the year. Wedbush analyst Dan Ives said the downtimes may have shifted about 20K vehicle deliveries into Q4. Despite the sequential decline in deliveries, Seeking Alpha analyst Poonam Arora believes Tesla has high growth in revenues and earnings locked in for at least the next ten years. (46 comments)
Drilling in check
U.S. shale producers plan to keep drilling under wraps even if oil prices top $100/bbl, citing the need for financial discipline during what they see as President Joe Biden's "war" on fossil fuel production. Many companies cited the Biden administration's decisions to limit drilling on federal lands and waters as the main reason they are restricting investments, as well as ongoing permitting delays and often hostile rhetoric from the administration. "It's political power," asserted Continental Resources founder Harold Hamm. "They believe that is what their base wants." Note that U.S. shale companies reinvested most of their capital in production this year, although there are fewer active U.S. oil rigs. (71 comments)
Not misleading
In a win for the fast-food industry, U.S. District Judge Hector Gonzalez dismissed a lawsuit accusing both McDonald's (MCD) and Wendy's (WEN) of misleading customers in advertising about the size of their hamburgers. Judge Gonzalez ruled that he did not see proof that the fast-food chains delivered smaller burgers than advertised, or that the plaintiff had even seen ads for the McDonald's Big Mac and Wendy's Bourbon Bacon Cheeseburger that were the basis of the lawsuit. The ruling will likely improve the legal position of other chains such as Yum! Brands' (YUM) Taco Bell and Restaurant Brands' (QSR) Burger King, which are also facing similar lawsuits. (7 comments)
Today's Markets
In Asia, Japan -1.6%. Hong Kong -2.7%. China +0.1%. India -0.5%.
In Europe, at midday, London +0.4%. Paris -0.2%. Frankfurt -0.3%.
Futures at 6:30, Dow +0.1%. S&P +0.1%. Nasdaq flat. Crude -0.1% to $88.72. Gold -0.3% at $1,841.90. Bitcoin -2.6% to $27,588.
Ten-year Treasury Yield +1 bp to 4.70%.
Today's Economic Calendar
Auto Sales
8:00 Fed's Bostic: "Economic Outlook for 2024: Inflation, Rising Interest Rates, Labor Market, and Uncertainties"
10:00 Job Openings and Labor Turnover Survey
Companies reporting earnings today »
What else is happening...
WSB survey results: Most readers are not stressed by student loans.
Delta Air (DAL) is latest carrier to find fake aircraft engine parts.
Biden admin gives China heads up on chip export curb expansion.
GM (GM), Stellantis (STLA) may face $9.5B in fuel economy fines.
JPMorgan's Dimon sees AI allowing 3.5-day workweek in future.
Pentagon's F-35 fighter jet program just got more expensive.
Drugmakers comply with Medicare pricing talks despite lawsuits.
Cleveland Fed's Loretta Mester sees one more rate hike this year.
Novo Nordisk (NVO) gains after winning Wegovy patent challenge.
WeWork skips $95M interest payments, eyes negotiating with lenders.