READS
- Canal Traffic Is Being Throttled by Climate Change Impact
- Maersk Slumps After Forecasting Weak Global Trade Until 2026
- China Foreign Investment Gauge Turns Negative For First Time
- In the Long Run, Investing Is All About the Economy*
- US Money Market Funds Draw Biggest Weekly Inflow in Seven Months
- Ruin: Money, Ego & Deception at FTX
- Sam Bankman-Fried Convicted of Fraud in Stunning FTX Crash
- Cathie Wood Says Bitcoin Is ‘Digital Gold’ as Deflation Hedge
- Buffett’s Berkshire Poised for Boost as Rates Burnish Cash Pile
- Macquarie’s First-Half Profit Falls, to Launch Up to A $2 Billion Buyback
- US October Jobs Report to Mark End of Blowout Payroll Gains
- UAW’s Fain Sees ‘Ugly’ Labor Strife Ahead at Ford Battery Plants
- How ‘Salts’ Get Into Labor Movements
- Apple’s Disappointing Outlook Spotlights Growing China Woes
- Walgreens Is Cancelling Corporate Bonuses as Big Pharmacies Face Increasing Difficulties
- Junk Food’s $30 Billion Opening Is India’s Next Health Crisis
- Restaurant Brands Revenue Disappoints Wall Street as Burger King Same-Store Sales Miss Estimates
- Shoppers Keep Splurging on Little Luxuries Like Starbucks, Fried Chicken
- Americans Are Walking 36% Less Since Covid
- Fall Auctions Woo Rich Bargain Hunters With $2.5 Billion in Art
- N.F.L., on Lookout for Growth, Finds Open Arms in Germany
- Why the Jet Stream Is Helping Some International Flights Arrive Early
- A Giant Leap for the Leap Second. Is Humankind Ready?
Open Interest Changes
PREMIUM
Prepper
Sam Bankman-Fried, the disgraced founder of collapsed crypto exchange FTX, has been found guilty on all seven criminal counts related to fraud and conspiracy. Prosecutors presented evidence and testimony showing that SBF had siphoned billions of customer deposits and doctored balance sheets at FTX to bankroll speculative investments, donate millions of dollars in political contributions, and cover major losses at sister hedge fund Alameda Research. While an appeal is likely, SBF now faces decades behind bars, with Judge Lewis Kaplan setting a sentencing date for March 28, 2024 (SBF also faces a second trial earlier that month).
Quote: "Sam Bankman-Fried perpetrated one of the biggest financial frauds in American history," U.S. Attorney Damian Williams, whose office led the investigation, said at a press conference outside the courthouse. "The cryptocurrency industry might be new; the players like Sam Bankman-Fried might be new, but this kind of fraud, this kind of corruption, is as old as time, and we have no patience for it. It's a warning to every single fraudster out there who thinks that they're untouchable, or that their crimes are too complex for us to catch, or that they're too powerful for us to prosecute."
Since his arrest in December, the former billionaire has maintained his innocence, claiming that unfortunate management mistakes, not criminal activity, were tied to the downfall of FTX. Earlier this month, three of Bankman-Fried's business affiliates told the jury that he posted, or had influenced others to post, misleading messages on social media to falsely represent the health of FTX in an effort to put an end to a deposit run. All three witnesses also agreed to cooperate with prosecutors after pleading guilty to fraud and other offenses.
What it means for crypto: The knee-jerk reaction saw benchmark cryptocurrency Bitcoin (BTC-USD) lose $1,000 in value since the SBF verdict was released to trade at the $34,000 level, but the losses were mostly contained. Interestingly enough, the collapse of FTX in November 2022 came after crypto hit its lowest point over the past three years, which was mainly due to the Fed's rate-hiking cycle and its impact on high-risk assets. Since SBF was arrested in December, things have actually been on the upswing, with Bitcoin even climbing 105% YTD and making crypto one of the best investment classes of 2023.
Go deeper: While the SEC and other agencies have expanded their crackdowns, like suing Coinbase (COIN) this past summer, the push for more regulation and enforcement could benefit investors by defining legal parameters and legitimizing the industry. There are also increased hopes for new spot bitcoin ETFs, which have been filed by several major financial firms, including Blackrock (BLK), and could draw in institutional players while keeping traders bullish. In the words of Assistant U.S. Attorney Nicolas Roos, who said in his closing statement before the jury, the SBF trial was "not about complicated crypto," but rather about "deception, lies, stealing and greed."
Zero-day workweek
Will AI make all jobs obsolete in the future? Elon Musk thinks so. "There will come a point where no job is needed. AI will be able to do everything," he told U.K. Prime Minister Rishi Sunak at an event at Lancaster House. The statements follow the U.K. government's two-day summit in Bletchley Park, where world leaders and companies signed a landmark pact for safety testing of frontier AI models, including OpenAI, Google (GOOG, GOOGL) DeepMind, and Meta (META). While employment is still an option, markets will be closely watching the nonfarm payrolls report due today, where "we will see whether there is a soft landing or not," according to SA analyst Christopher Robb. (45 comments)
iOutlook
Shares of Apple (AAPL) fell 3.4% to $171.60 AH on Thursday following the tech giant's fourth consecutive quarter of declining revenues. Investors also seemed disappointed by guidance despite an earnings beat, strong services business performance and a 3% growth in iPhone sales. On the conference call, CFO Luca Maestri forecast Q1 total revenue to be similar to last year, while iPhone revenue will likely grow Y/Y, even with one week less than a year ago. Investing Group Leader Jonathan Weber also said the results were not impressive, given Apple's expensive valuation, while Livy Investment Research believes Apple's persistent revenue declines are a telling tale of increased vulnerability to consumer spending headwinds. (21 comments)
Physical retail
A year after opening its first location, Amazon (AMZN) is shuttering physical apparel stores as the e-commerce giant focuses its brick-and-mortar plans on its grocery business. The shift follows last year's move to close all physical bookstores, as well as Amazon 4-star and Amazon Pop Up shops in the U.S. and U.K. A company spokesperson said physical retail still remains important for Amazon, which will continue to invest in growing Amazon Fresh and Whole Foods Market. The latest developments come ahead of the holiday season, where spending is expected to return to pre-pandemic levels. (1 comment)
Today's Markets
In Asia, Japan closed. Hong Kong +2.5%. China +0.7%. India +0.4%.
In Europe, at midday, London -0.1%. Paris -0.1%. Frankfurt +0.2%.
Futures at 7:00, Dow flat. S&P -0.2%. Nasdaq -0.4%. Crude +0.2% to $82.65. Gold +0.1% to $1,994.60. Bitcoin -3.2% to $34,259.
Ten-year Treasury Yield unchanged at 4.66%.
Today's Economic Calendar
8:00 Fed’s Barr's Speech
8:30 Non-farm payrolls
9:45 PMI Composite Final
10:00 ISM Service Index
12:45 PM Fed’s Kashkari's Speech
1:00 PM Baker Hughes Rig Count
3:30 PM Fed’s Barr's Speech
Companies reporting earnings today »
What else is happening...
Palantir (PLTR) surges on upbeat guidance; S&P 500 inclusion ahead?
SpaceX's (SPACE) Starlink at 'breakeven cash flow' ahead of possible IPO.
Shell (SHEL) rallies on $3.5B stock buyback as gas trading lifts Q3 profit.
Block (SQ) pops after earnings beat, strong guidance and $1B buyback.
SolarEdge slides after Q3 miss; Guggenheim 'gives up' on company.
Novo Nordisk (NVO): 80% of insured U.S. patients pay <$25 for Wegovy.
Bank of England holds benchmark interest rate at 5.25% as expected.
Eli Lilly posts Q3 beat on diabetes drugs; pushes Alzheimer’s prospects.
Broadcom CEO met Chinese officials last weekend over VMware deal.
Swift profits: Live Nation (LYV) reports earnings above expectations.