- Germany Cut Gas Imports By a Third in 2023
- In Europe, Trains Are Full, and More Are on the Way
- Citi Targets China Investment Bank Unit Launch, 30 New Hires By End 2024
- Wall Street’s Ambitions in China Run Into a Rising Firewall
- Wall Street Is Already Cutting Oil-Price Forecasts for This Year
- APA to Buy Callon Petroleum in $4.5 Billion Deal
- How Supply-Chain Snarls Made Everyone Wrong on Inflation
- Fed Minutes Showed Officials Feeling Better About Inflation
- The Hidden Force Pushing Mortgage Rates Down
- Why Companies Still Aren’t in a Firing Mood
- U.S. Awards Chip Supplier $162 Million to Bolster Critical Industries
- Apple Hit With Second Downgrade This Week as iPhone Worries Grow
- U.S. Auto Sales Bounced Back in 2023
- EV Startup Fisker Ditches Tesla-Style Direct Sales Model
- Billionaire Space Battle Heats Up as Bezos Eyes SpaceX Rival
- SpaceX Illegally Fired Workers Critical of Musk, Federal Agency Says
- Clorox’s Future Depends on Winning Your Cat’s Litterbox
- Jeff Zucker’s Latest Bet: Prestige TV
- Big Fashion Still Hasn’t Figured Out How to Pay a Living Wage
- How the Push for Diversity at Colleges and Companies Came Under Siege
- Just a Billion Doesn’t Cut It on This Exclusive Florida Island
- Pop-Tarts’ Devoured Mascot May Live to Be Eaten Again
Open Interest Changes
Many are watching as conflict and war expand across the globe, and what those consequences might mean for various sectors of the economy. Everything from energy and finance to supply chains hangs in the balance, with spillover effects mostly acutely impacting defense production. Countries and companies alike are preparing by restocking their arsenals and inventories, as well as fast-tracking new technologies to give them the upper hand or banning their adversaries from acquiring them.
Bigger picture: The U.S. has already outlawed or effectively lobbied allies against selling cutting-edge semiconductor chips to China out of fear that the silicon could be used for precision-guided kits or other advanced military systems. Traditional arms are also back in fashion, with BAE Systems (OTCPK:BAESY) announcing today that it would restart production of M777 howitzer parts for the U.S. Army. Putting it in perspective, the last order that took place was five years ago, but with output back online, BAE expects to ink new contracts for the artillery cannons given inquiries from more than eight countries.
It's not the only company going into overdrive. Thales is bringing back the Starstreak portable air-defense missile, while other firms like Raytheon (NYSE:RTX) struggle to ramp up production of the popular NASAMS, which helps protect crucial areas like the airspace over the White House. Demand may not be the only factor when deciding how to invest, with SA's screening tool helping identify strong buys within the defense sector. Check out the Top Defensive Stocks For Turbulent Times by Steve Cress, Head of Quantitative Strategies at Seeking Alpha.
Conflict zones: It's not only Russia-Ukraine, China-Taiwan, and an escalating war across the Middle East. Cartel chaos in Mexico has prompted mainstream discussion in the U.S. over whether military personnel should be sent south of the border, while a Venezuela-Guyana conflict could shake things up in Latin America. The U.S. is also preparing military options to secure international shipping in the Red Sea, as well as bases for drones in Africa to counter Russia and stop an Islamist insurgency across the region. Preparing for what might come ahead, President Biden and Congress signed off on a U.S. defense policy bill in December that approved a record $886B in annual military spending. (2 comments)
More in store?
U.S. commercial bankruptcy filings jumped 72% to 6,569 in 2023, primarily due to increased interest rates, tougher lending standards and pushback from the pandemic. "These facts teach investors a timeless lesson," SA Investing Group Leader Value Digger declared. "Investors need to avoid the leveraged (indebted) companies (i.e. REITs, utilities etc.) and buy companies with fortress balance sheets including ZERO leverage, if they want to sleep well at night." Among the notable firms that filed for bankruptcy last year were Yellow Corporation (OTC:YELLQ), Rite Aid (OTC:RADCQ) and Bed Bath & Beyond (OTCPK:BBBYQ) as well as SPACs like WeWork (OTC:WEWKQ), Lordstown Motors (OTC:RIDEQ) and Bird Global (OTC:BRDSQ). (2 comments)
The latest FOMC minutes have provided little insight on the timing of potential rate cuts, with Fed officials acknowledging "an unusually elevated degree of uncertainty" about the economic outlook. "The minutes confirm whatever you wanted to think about the direction of U.S. interest rates before the release," UBS' Paul Donovan said. "I would suggest they are consistent with three rate cuts, starting later than March - but that was my bias before the minutes." Some Fed members also noted that keeping the benchmark rate at an elevated level might be necessary should inflation stay above target, meaning the central bank will continue to base its policy decisions on incoming economic data. (18 comments)
2023 was a bumper year for Meta Platforms (NASDAQ:META), becoming the best-performing Magnificent 7 stock after AI darling Nvidia (NVDA). Shares soared 178% during the "year of efficiency," in which CEO Mark Zuckerberg refocused the business on digital advertising and social media market share and away from moonshot projects like the Metaverse. As growth returned and the stock neared all-time highs, the captain of the ship also decided to cash in. New filings show that Zuckerberg offloaded nearly half a billion dollars of Meta shares in the final two months of the year, selling stock on every trading day between Nov. 1 and the end of 2023 (his last sales occurred in November 2021). (2 comments)
In Asia, Japan -0.6%. Hong Kong -0.1%. China -0.4%. India +0.7%.
In Europe, at midday, London +0.2%. Paris +0.3%. Frankfurt +0.1%.
Futures at 6:30, Dow +0.2%. S&P +0.1%. Nasdaq -0.1%. Crude +1.1% to $73.52. Gold +0.5% to $2052.30. Bitcoin +2% to $43,387.
Ten-year Treasury Yield +5 bps to 3.95%
Today's Economic Calendar
7:30 Challenger Job-Cut Report
8:15 ADP Jobs Report
8:30 Initial Jobless Claims
9:45 PMI Composite Final
10:30 EIA Natural Gas Inventory
11:00 EIA Petroleum Inventories
4:30 PM Fed Balance Sheet
Companies reporting earnings today »
What else is happening...
Red Sea ship attacks send ocean freight rates soaring.
Crude oil bounces after shutdown at major Libyan oilfield.
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Meet the latest Chinese electric vehicle model - Xiaomi's SU7.
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Cannabis stocks in focus report DEA reviewing legal status.
PepsiCo (PEP) looks to leverage both Rockstar and Celsius (CELH).
Disney (DIS) wins Blackwells backing in boardroom fight vs. Trian.
TikTok sets sights on Amazon (AMZN) with goal of growing e-commerce tenfold.