- China Tightens Some Trading Restrictions for Domestic and Offshore Investors
- China Stocks Post More Wild Swings After Beijing Stability Vow
- China Real-Estate Projects Set to Receive Loans Under ‘Whitelist’ Program
- Top U.S. Treasury Officials to Visit Beijing for Economic Talks
- Gold Prices to Hit $2,200 and a ‘Dramatic’ Outperformance Awaits Silver in 2024, Says UBS
- Powell Tells ‘60 Minutes’ Fed Is Wary of Cutting Rates Too Soon
- Why Are Americans Wary While the Economy Is Healthy? Look at Nevada
- How Nevada Is Pushing to Generate Jobs Beyond the Casinos
- Morgan Stanley and Goldman Spoil Private Credit’s Record Deal
- Why NYC Apartment Buildings Are on Sale Now for 50% Off
- What Business Leaders Are Saying About the Red Sea Attacks
- McDonald’s Sales Growth Slows as Mideast War Hurts Results
- Big Oil’s Optimism Faces Reality Check in Tech-Obsessed Market
- Why Is Big Tech Still Cutting Jobs?
- Merck to Buy Elanco’s Aqua Business for $1.3 Billion
- Apple Vision Pro’s First Test: Will People Wear It in Public?
- Google and Yahoo Are Cracking Down on Inbox Spam. Don’t Expect Less Email Marketing
- Samsung’s Leader Acquitted in Stock and Accounting Fraud Case
- Yandex Owner to Sever Ties to Russia With $5.2 Billion Sale
- Wegovy Maker to Boost Production Capacity With Multibillion-Dollar Deal
- Team Cow or Team Soy: The Milk Wars Roiling America
- How Much for Thin Mints? Some Girl Scouts Raise Cookie Prices
- What Happens to Chinatown When the Sports Teams Leave
- World Cup 2026 Final Goes to NYC-Area in Victory Over Dallas and LA
- N.F.L.’s Rapid Embrace of Gambling Creates Mixed Signals
Open Interest Changes
Hopes are building for a rescue of Chinese stocks after a drubbing that erased $7T from mainland equities and shares in Hong Kong since their peaks in 2021. An expected rebound from strict zero-COVID measures has failed to materialize, prompting policymakers to consider new ways to stabilize the stock market, with risks to consumer confidence threatening another downward spiral. "China's equity market followed up a very weak 2023 with another 10% loss in the first three weeks of 2024," Principal Financial Group noted in a new SA article, China Outlook: Market Rescue Welcomed, But More Needed.
Growth challenges: Two other major issues were recently flagged in Wall Street Breakfast that highlight the problems facing the world's second-largest economy. Evergrande (OTCPK:EGRNQ), the world's most indebted property developer, was finally ordered to liquidate last week, spelling further trouble for the Chinese construction industry which accounts for as much as a quarter of GDP. A longer-term growth issue is related to demographics, with China's shrinking population set to sap the nation of a key source of labor and demand.
Looking to end the country's stock market rout, fresh reports overnight suggested that the China Securities Regulatory Commission and other regulators will soon update top authorities on a range of policy initiatives. China's blue-chip CSI 300 Index soared 3.5% on the news, while small-cap equities recorded an even bigger bump, with the CSI 1000 Index jumping 7%. Support could range from direct stimulus measures to those geared toward property stabilization, but investors sizing up the situation will be looking for concrete actions or a coordinated response to assuage their concerns.
Will it impact the U.S.? Fed Chair Jay Powell touched on the matter during a 60 Minutes episode that aired on Sunday, saying China had moved away from a "market-led growth model" in favor of state-owned enterprises and there was "still too much associated with real estate investment." He also pointed out that economic relations are not deeply intertwined with the American financial system, but rather mostly consist of the U.S. buying Chinese manufactured products. As long as that is the case, that would mean minimal implications, according to Powell. "We may feel them a bit, but they shouldn't be that large."
Riding the wave
Palantir Technologies (PLTR) surged 17.3% to $19.61/share AH on Monday as the enterprise software company's Q4 revenue topped expectations. "Our results reflect both the strength of our software and the surging demand we are seeing across industries for AI platforms," CEO Alex Karp declared. "Our U.S. commercial business continues to be a significant driver of our growth, a trend that we expect to continue." Investing Group Leader Ahan Vashi still advised caution, as mixed guidance issued for 2024 was "not exceptional, and as of now, Palantir is not showing AI-powered hypergrowth!" (95 comments)
Aiming to fix structural issues in the $26T Treasury market, the SEC is expected to adopt a rule today requiring proprietary traders and companies that regularly deal in U.S. Treasuries to register as broker-dealers. The new rule, and a recently passed requirement for hedge funds to clear more of their Treasury trades centrally, are aimed at boosting regulatory oversight and would mark the biggest overhaul of the market in decades. Some concerns have also been raised. Those include the increasing costs needed to participate in the industry, as well as "unnecessary regulatory burdens" on pensions and risks of a major liquidity drain, among others.
Layoffs continue to roil across the tech sector, with more than 120 tech companies giving pink slips to a combined total of more than 32,000 employees during the first five weeks of 2024, according to Layoffs.fyi. In 2023, tech firms made about 260,000 workers redundant. These companies are continuing to streamline costs and improve efficiencies amid constant pressure to match the growth and profit expectations of investors. Tech companies that have announced job cuts so far this year include Snap (SNAP), PayPal (PYPL), Google (GOOG, GOOGL), Microsoft (MSFT) and Salesforce (CRM). (80 comments)
In Asia, Japan -0.5%. Hong Kong +4%. China +3.2%. India +0.6%.
In Europe, at midday, London +0.5%. Paris +0.3%. Frankfurt -0.1%.
Futures at 7:00, Dow -0.1%. S&P -0.1%. Nasdaq -0.1%. Crude +0.6% to $73.23. Gold flat at $2,042.30. Bitcoin -0.8% to $42,823.
Ten-year Treasury Yield unchanged at 4.16%.
Today's Economic Calendar
What else is happening...
WSB survey results: Subscribers split on U.S. four-day workweek.
Novo (NVO)-Catalent (CTLT) deal to ease Wegovy supply concerns.
Caterpillar (CAT) shares hit record high after earnings beat estimates.
Virgin Galactic (SPCE) reports flight issue to FAA amid ongoing review.
Restaurant stocks fall as McDonald's warns on new pricing environment.
Estee Lauder (EL) rallies as job cuts overshadow downbeat guidance.
Historic Southern California storm threatens flooding and landslides.
Archer-Daniels-Midland (ADM) faces DOJ probe on accounting practices.
Alcoa sinks as Trump threatens tariffs on Chinese imports if re-elected.
NYCB's (NYCB) drastic financial moves followed tense talks with OCC.