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U.S. Durable Goods Orders Advanced In August

Brian Turner
27 Sep, 2023
New York City

New orders for manufactured durable goods orders increased 0.2% in August from the previous month to $284.7 billion, the U.S. Census Bureau reported Wednesday.

New orders from a year ago advanced 4.2% and July orders were upwardly revised to a decline of 5.6%

Excluding transportation, new orders increased 0.4% and excluding defense, orders declined 0.7%.

Critically watched as a barometer for business spending, new orders for capital goods excluding defense and aircraft orders rose 0.9%, reversing a 0.4% decline in July.

Shipments for manufactured durable goods orders increased 0.5% in August to $284.6 billion, and shipments increased in three of the last four months.

U.S. Stock Movers: Auto Workers, Costco Wholesale, Target

Scott Peters
27 Sep, 2023
New York City

The S&P 500 index decreased 1.03% to 4,293.08 and the Nasdaq Composite fell 1.1% to 13,126.05.

Target Corp edged slightly higher to $109.55 after the company said it plans to close nine stores in several states after repeated theft incidences, store violence and crime.

The retail chain said it will shutter stores in New York City, Seattle, Portland and San Francisco-Oakland area.

Costco Wholesale Corp decreased 1.7% to 543.49 after the membership warehouse retailer reported better-than-expected quarterly results.

Net sales in the fourth quarter ending in September increased 9.4% to $77.43 billion from $70.76 billion a year ago.

Comparable companywide sales, adjusted for gasoline prices and foreign exchange, increased 3.8% and the U.S. sales rose 3.1% from a year ago.

Net income in the quarter increased to $2.16 billion from $1.868 billion and diluted earnings per share rose to $4.86 from $4.20 a year earlier.

Tesla Inc, Lucid Group Inc and Rivian Automotive gained between 0.5% and 1.5% after the United Auto Workers deepened the worker's strike at several plants in the Midwest.

Bank Stocks In Focus After Rate Hike Worries overshadow Market Sentiment

Barry Adams
27 Sep, 2023
New York City

Stocks attempted a rebound and the U.S. Treasury yields edged slightly lower but the U.S. dollar continued to advance amid rising market volatility.

Benchmark indexes lacked direction in early trading after the yield on the 2-year and 10-year Treasury notes edged lower but hovered at 16-year highs.

The S&P 500 and the Nasdaq Composite indexes are facing headwinds and the benchmark indexes are set to close down between 3% and 4% for the second month in a row in September.

Higher rates have begun to impact housing market activities and new home sales fell at the fastest pace in eleven months in August, the Commerce Department report showed Wednesday.

Banks are also in focus on the worries that higher-for-longer rates will force several banks, regardless of the size, to raise more capital from investors.

Rising U.S. Treasury yields are contributing to unrealized losses in the portfolio of government securities held by banks, and interest rates are not near peak rates.

Moreover, the recent rally in oil prices over the last three months are raising the prospect of a rebound in oil-driven inflation, further putting pressure on policy makers to keep higher rates for longer.

U.S. Indexes & Yields

The S&P 500 index decreased 1.03% to 4,293.08 and the Nasdaq Composite fell 1.1% to 13,126.05.

The yield on 2-year Treasury notes declined to 5.06%, 10-year Treasury notes inched lower to 4.56% and 30-year Treasury bonds edged down to 4.64%.

Crude oil increased $1.33 to $91.74 a barrel and natural gas prices rose 2 cents to $2.87 a thermal unit.

The dollar index edged higher to 106.34, the level last seen in November 2022 and extended gains from the low of 99.85 on July 13, 2023.

U.S. Stock Movers

Target Corp edged slightly higher to $109.55 after the company said it plans to close nine stores in several states after repeated theft incidences, store violence and crime.

The retail chain said it will shutter stores in New York City, Seattle, Portland and San Francisco-Oakland area.

Costco Wholesale Corp decreased 1.7% to 543.49 after the membership warehouse retailer reported better-than-expected quarterly results.

Net sales in the fourth quarter ending in September increased 9.4% to $77.43 billion from $70.76 billion a year ago.

Comparable companywide sales, adjusted for gasoline prices and foreign exchange, increased 3.8% from a year ago and U.S. sales rose 3.1% from a year ago.

Net income in the quarter increased to $2.16 billion from $1.868 billion and diluted earnings per share rose to $4.86 from $4.20 a year earlier.

Tesla Inc, Lucid Group Inc and Rivian Automotive gained between 0.5% and 1.5% after the United Auto Workers deepened the worker's strike at several plants in the Midwest.

Europe Movers: Financial Services Stocks, H&M Group, NN Group

Inga Muller
27 Sep, 2023
Frankfurt

European markets lacked direction and investors debated future direction and terminal levels for interest rates in the months ahead.

The DAX index decreased 0.2% to 15,220.95, the CAC-40 index decreased 0.02% to 7,071.67 and the FTSE 100 index decreased 0.3% to 7,603.78.

The yield on 10-year German bonds increased to 2.78%, French bonds traded higher to 3.34%, the UK gilts edged up to 4.29% and Italian bonds rose to 4.69%.

Higher rate worries dragged banks and insurance companies lower and Deutsche Bank, Commerzbank, Allianz, BNP Paribas and AXA SA declined between 0.5% and 1.5%.

H&M Group AB jumped 3.2% to skr 159.82 after the Swedish retailer said it plans to buy back its class B shares for 3 billion kronor starting September 27.

NN Group declined 14.6% to €30.89 after the largest insurance group of the Netherlands said that the latest court ruling could have adverse material impact on its financial health.

A court in Hague ruled that the company had not provided enough information about the investment-linked insurance products, reversing the earlier ruling in 2017.

The ruling also dragged rival Dutch insurance companies ASR Nederland by 9.8% to €36.58 and Aegon NV by 0.8% to $4.86.

Weak Consumer Sentiment Weighs On European Markets, Euro Drifted Lower

Bridgette Randall
27 Sep, 2023
Frankfurt

European markets lacked direction for the second week in a row on the ongoing interest rate uncertainties and looming economic slowdown.

Benchmark indexes in Paris, London and Frankfurt diverged but traded in a tight range and the euro drifted to a new six-month low.

The yield in the euro bond markets hovered near 12-year highs and investors debated the central bank's next move and terminal rate levels.

In the last two weeks, investors have suddenly shifted their views on rate path and terminal rates after policymakers stressing for months that higher rates are here to stay.

The yields on Germany, French and Italian bonds jumped to the levels last seen 12 years ago, and investors are bracing for higher rates in the months ahead.

In economic news in the region, the latest survey of German consumers suggested high inflation is impacting consumer morale and consumer sentiment is not expected to improve in the rest of the year.

The forward-looking consumer climate index declined to -26.5 in October, from a revised -25.6 fall in the prior month.

The chances that consumer sentiment can sustainably recover before the end of this year are dwindling more and more," said Rolf Bürkl, GfK consumer expert.

"Private consumption will therefore not make a positive contribution to overall economic development this year,” Burki added.

Europe Indexes & Yields

The DAX index decreased 0.2% to 15,220.95, the CAC-40 index decreased 0.02% to 7,071.67 and the FTSE 100 index decreased 0.3% to 7,603.78.

The yield on 10-year German bonds increased to 2.78%, French bonds traded higher to 3.34%, the UK gilts edged up to 4.29% and Italian bonds rose to 4.69%.

The euro edged lower to a three-month low to $1.055, the British pound to $1.214 and the U.S. dollar fetched 91.71 Swiss cents.

Brent crude decreased $1.04 to $95.0 a barrel and the Dutch TTF natural gas edged lower €0.62 to €39.70 per MWh.

Europe Stock Movers

H&M Group AB jumped 3.2% to skr 159.82 after the Swedish retailer said it plans to buy back its class B shares for 3 billion kronor starting September 27.

NN Group declined 14.6% to €30.89 after the largest insurance group of the Netherlands said that the latest court ruling could have adverse material impact on its financial health.

A court in Hague ruled that the company had not provided enough information about the investment-linked insurance products, reversing the earlier ruling in 2017.

The ruling also dragged rival Dutch insurance companies ASR Nederland by 9.8% to €36.58 and Aegon NV by 0.8% to $4.86.

Market Selloff Accelerates With Looming Federal Government Shutdown

Barry Adams
26 Sep, 2023
New York City

Worries of the U.S. economy's health resurfaced and investors sold stocks after new home sales fell at the sharpest pace in eleven months.

Stocks resumed downward slide and extended previous week's losses and reversed gains in Monday's trading and investors reassessed housing market health and its impact on the economy.

Benchmark indexes fell more than 1.5% as fears of rising rates gripped market sentiment and investors sold high growth and tech stocks after new home sales fell at a faster pace.

Investors have been bidding stocks up for the first six months of the year on the hopes that interest rates are closer to peak rates.

However, investors changed their views on interest rate trajectory two weeks later and finally accepted the Fed's forward projections on interest rates.

So what convinced investors, the Fed's forward projections released at the time of announcing rate decision after the two-day meeting, suggested at least one more rate hike this year, and fewer rate cuts in 2024.

Moreover, the rebound in crude oil prices also contributed to the market sentiment turning bearish on bonds.

With yields on 2-year and 10-year Treasury notes at 16-yea highs and 30-year Treasury bonds at 11-year highs, higher rates are beginning to have impact on stock valuations.

However, despite multiple rate hikes, the U.S. economy is still expected to grow at 2.1% in 2023, according to the Fed's latest projection, sharply higher than the previous estimate of 1%, release in June.

But investors decided to focus on the Fed's higher-for-longer stance and overlooked the resilient economy and strong labor market conditions.

Moreover, the potential U.S. government shutdown and higher crude oil prices also weighed on market sentiment.

The U.S. federal government is expected to run out of cash if the Congress fails to pass the fiscal year budget on October 1.

Moody's Investors Service said on Monday that the U.S. federal government shutdown will be "credit negative" and could hamper the country's AAA rating, and may push bond yields higher.

"In particular, it would demonstrate the significant constraints that intensifying political polarization put on fiscal policymaking at a time of declining fiscal strength, driven by widening fiscal deficits and deteriorating debt affordability," Moody's said in a statement.

In Wednesday's trading, all sectors declined and technology and consumer discretionary sectors led with losses of 1.4% but energy and healthcare sectors lagged the market decline with losses of 0.3%.

New Home Sales Declined In August

New single-family home sales declined 8.7% to a seasonally adjusted annualized rate of 675,000 in August, the Commerce Department reported today.

Home sales fell the most in 11 months from the upwardly revised 8% jump in the previous month.

The median price of new home sold was $430,300 and the average sales price was $514,000, lower than $440,300 and $530,800 respectively, a year ago.

Sales plunged in the Midwest by 17.2% to 77,000, the West by 9.4% to 183,000 and the South by 7.5% to 383,000 but rose in the Northeast by 6.7% to 32,000.

U.S. Indexes & Yields

The S&P 500 index decreased 1.4% to 4,278.48 and the Nasdaq Composite fell 1.5% to 13,082.56.

The yield on 2-year Treasury notes hovered at 5.16%, 10-year Treasury notes inched higher to 4.55% and 30-year Treasury bonds edged up to 4.68%.

Crude oil increased $0.77 to $90.45 a barrel and natural gas prices declined 1 cent to $2.62 a thermal unit.

The dollar index edged higher to 106.20, the level last seen in November 2022 and extended gains from the low of 99.85 on July 13, 2023.

U.S. Stock Movers

Thor industries rose 1.% to $95.68 after the company reported revenue declined 28.4% in its latest quarter of $2.74 billion.

Net income in the quarter declined to $90.3 million from $280.9 million and diluted earnings per share fell to $1.68 from $5.15 a year ago.

The company also forecasted revenue to decline in the next fiscal year to between $10.5 billion and $11.0 billion from $11.2 billion in fiscal 2023.

United Natural Foods Inc dropped 23% to $14.44 after the company reported weaker-than-expected sales in its latest quarter and forecasted additional weakness in sales and operating earnings in the current quarter.

Surging Bond Yields Roiled European Stocks and Currencies

European markets retained downward bias and investors debated interest rate path and the impact of higher rates on the economy.

Benchmark indexes in Frankfurt, and Paris edged lower but in London traded higher and investors reacted to growing global uncertainties.

Chinese property market worries were in forefront after the most-indebted property group in the world and the largest Chinese property developer faced more headwinds in restructuring its debt.

China Evergrande said its listed subsidiary Hengda Real Estate defaulted on a 4 billion yuan or $547 million loan principal and interest payment.

Moreover, the potential U.S. government shutdown and higher crude oil prices also weighed on market sentiment.

The U.S. federal government is expected to run out of cash if the Congress fails to pass the fiscal year budget on October 1.

Moody's Investors Service said on Monday that the U.S. federal government shutdown will be "credit negative" and could hamper the country's AAA rating, and push bond yields higher.

"In particular, it would demonstrate the significant constraints that intensifying political polarization put on fiscal policymaking at a time of declining fiscal strength, driven by widening fiscal deficits and deteriorating debt affordability," Moody's said in a statement.

Europe Indexes & Yields

The DAX index decreased 1% to 15,255.87, the CAC-40 index fell 0.7% to 7,074.02 and the FTSE 100 index added 0.02% to 7,625.72.

The yield on 10-year German bonds decreased to 2.77%, French bonds traded lower to 3.32%, the UK gilts edged down to 4.28% and Italian bonds rose to 4.67%.

The euro edged lower to a three-month low to $1.060, the British pound to $1.218 and the U.S. dollar fetched 91.22 Swiss cents.

Natural gas prices eased after rallying for five days in a row amid supply worries, despite elevated inventories in the region.

Yesterday, Norway's Gassco extended production shutdown at its Skarv field by a week to October 8.

Investors have been bidding up prices on the production disruptions worries by extreme weather events and prolonged outages at the U.S. LNG shipment terminals amid ongoing Russia's invasion of Ukraine.

Brent crude decreased $0.84 to $94.12 a barrel and the Dutch TTF natural gas edged higher €4.12 to €40.32 per MWh.

Europe Stock Movers

Rheinmetall AG advanced 0.2% to €249.20 after the German automotive and arms maker won orders from two companies totaling several hundred million euros.

Origin Enterprises Plc jumped 6% to €3.34 despite the company reporting lower profit before tax in the fiscal year 2023.

ASOS Plc decreased 2.7% to 377.60 after the online apparel and fashion retailer reported a decline in sales in the fiscal fourth quarter and warned that net income is likely to be near the bottom end of its estimate.

Smiths Group plc declined 1.5% to 1,649.0 pence despite the engineering services company reporting record operating profit in the year ending in July.

Luxury stocks declined for the second day in a row after China property woes deepened and dampened hopes of a speedy economic recovery.

LVMH, Kering, Hermes and Richemont declined between 1% and 3%.

New Home Sales Declined at Fastest Pace In 11 Months In August

Brian Turner
26 Sep, 2023
New York City

New single-family home sales declined 8.7% to a seasonally adjusted annualized rate of 675,000 in August, the Commerce Department reported today.

Home sales fell the most in 11 months from the upwardly revised 8% jump in the previous month.

The median price of new home sold was $430,300 and the average sales price was $514,000, lower than $440,300 and $530,800 respectively, a year ago.

Sales plunged in the Midwest by 17.2% to 77,000, the West by 9.4% to 183,000 and the South by 7.5% to 383,000 but rose in the Northeast by 6.7% to 32,000.

On an annual basis, new home sales rose 5.8% across the nation, jumped 18.5% in the Northeast, advanced 24.2% in the Midwest, soared 44.1% in the West but declined 9.2% in the South.

U.S. Movers: Amazon.com, Thor Industries, United Natural Foods

Scott Peters
26 Sep, 2023
New York City

Thor industries rose 1.% to $95.68 after the company reported revenue declined 28.4% in its latest quarter of $2.74 billion.

Net income in the quarter declined to $90.3 million from $280.9 million and diluted earnings per share fell to $1.68 from $5.15 a year ago.

The company also forecasted revenue to decline in the next fiscal year to between $10.5 billion and $11.0 billion from $11.2 billion in fiscal 2023.

United Natural Foods Inc dropped 23% to $14.44 after the company reported weaker-than-expected sales in its latest quarter and forecasted additional weakness in sales and operating earnings in the current quarter.

Revenue in the fiscal fourth quarter ending in July increased 2.0% to $7.4 billion but the company swung to a net loss of $68 million from a profit of $39 million and diluted earnings per share was ($1.15) compared to 63 cents a year ago.

The company forecasted fiscal 2024 revenue between $30.9 billion and $31.5 billion and net loss between $110 and $36 million and diluted loss per share between 60 cents and $1.86.

Amazon.com Inc declined 2.5% to $127.96 after the online retailer and marketplace operator was sued by the Federal Trade Commission and attorney generals of 17 states accused company of "monopoly power" and charge higher prices for customers and unlawfully exclude rivals.

Selloff Resumes On Wall Street After Bond Yields Advanced to 16-year Highs

Barry Adams
26 Sep, 2023
New York City

Stocks resumed downward slide and extended previous week's losses after gains in Monday's trading.

Benchmark indexes fell 1% as fear of rising rates gripped market sentiment and investors sold high growth and tech stocks.

Investors have been bidding stocks up for the first six months of the year on the hopes that interest rates are closer to peak rates.

However, investors changed their views on interest rate trajectory two weeks and finally accepted the Fed's views on interest rates.

So what convinced investors, the Fed's forward projections released at the time of announcing rate decision after the two-day meeting, suggested at least one more rate hike this year, and fewer rate cuts in 2024.

Moreover, the rebound in crude oil prices also contributed to the market sentiment turning bearish on bonds.

With yields on 2-year and 10-year Treasury notes at 16-yea highs and 30-year Treasury bonds at 11-year highs, higher rates are beginning to have impact on stock valuations.

However, despite multiple rate hikes, the U.S. economy is still expected to grow at 2.1% in 2023, according to the Fed's latest projection, sharply higher than the previous estimate of 1%, release in June.

But investors decided to focus on the Fed's higher-for-longer stance and overlooked the resilient economy and strong labor market conditions.

In Wednesday's trading, all sectors declined and technology and consumer discretionary sectors led with losses of 1.4% but energy and healthcare sectors lagged the market decline with losses of 0.3%.

New Home Sales Declined In August

New single-family home sales declined 8.7% to a seasonally adjusted annualized rate of 675,000 in August, the Commerce Department reported today.

Home sales fell the most in 11 months from the upwardly revised 8% jump in the previous month.

The median price of new home sold was $430,300 and the average sales price was $514,000, lower than $440,300 and $530,800 respectively, a year ago.

Sales plunged in the Midwest by 17.2% to 77,000, the West by 9.4% to 183,000 and the South by 7.5% to 383,000 but rose in the Northeast by 6.7% to 32,000.

U.S. Indexes & Yields

The S&P 500 index decreased 1.03% to 4,293.08 and the Nasdaq Composite fell 1.1% to 13,126.05.

The yield on 2-year Treasury notes hovered at 5.16%, 10-year Treasury notes inched higher to 4.55% and 30-year Treasury bonds edged up to 4.68%.

Crude oil increased $0.33 to $90.02 a barrel and natural gas prices declined 1 cent to $2.64 a thermal unit.

The dollar index edged higher to 106.12, the level last seen in November 2022 and extended gains from the low of 99.85 on July 13, 2023.

U.S. Stock Movers

Thor industries rose 1.% to $95.68 after the company reported revenue declined 28.4% in its latest quarter of $2.74 billion.

Net income in the quarter declined to $90.3 million from $280.9 million and diluted earnings per share fell to $1.68 from $5.15 a year ago.

The company also forecasted revenue to decline in the next fiscal year to between $10.5 billion and $11.0 billion from $11.2 billion in fiscal 2023.

United Natural Foods Inc dropped 23% to $14.44 after the company reported weaker-than-expected sales in its latest quarter and forecasted additional weakness in sales and operating earnings in the current quarter.

Europe Movers: ASOS, Luxury Stocks, Origin Enterprises, Rheinmetall, Smiths Group

Inga Muller
26 Sep, 2023
Frankfurt

European markets extended losses of the previous week after bond yields surged and the euro, the pound and the Swiss franc dropped to multi-month lows.

The DAX index decreased 0.7% to 15,295.80, the CAC-40 index fell 0.8% to 7,067.34 and the FTSE 100 index added 0.2% to 7,638.78.

The yield on 10-year German bonds decreased to 2.77%, French bonds traded lower to 3.32%, the UK gilts edged down to 4.28% and Italian bonds rose to 4.67%.

Rheinmetall AG advanced 0.2% to €249.20 after the German automotive and arms maker won orders from two companies totaling several hundred million euros.

Origin Enterprises Plc jumped 6% to €3.34 despite the company reporting lower profit before tax in the fiscal year 2023.

ASOS Plc decreased 2.7% to 377.60 after the online apparel and fashion retailer reported a decline in sales in the fiscal fourth quarter and warned that net income is likely to be near the bottom end of its estimate.

Smiths Group plc declined 1.5% to 1,649.0 pence despite the engineering services company reporting record operating profit in the year ending in July.

Luxury stocks declined for the second day in a row after China property woes deepened and dampened hopes of a speedy economic recovery.

LVMH, Kering, Hermes and Richemont declined between 1% and 3%.

Surging Bond Yields Roiled European Stocks Markets

Bridgette Randall
26 Sep, 2023
Frankfurt