OPENING CALL
Stock futures and Treasury yields fell early Tuesday as investors sought the perceived safety of sovereign bonds after the Kremlin revised its nuclear doctrine in response to the U.S. allowing Ukraine to target sites inside Russia.
The Kremlin's move came as Ukraine said on Tuesday it had fired a U.S.-supplied long range missile into Russia, according to a Bloomberg report.
The prospect of a greater conflagration emanating from Russia's invasion of Ukraine caused a traditional market flight to safety, with equity futures falling and Treasurys attracting buyers, forcing yields lower.
The moves come as investors wait to see who Donald Trump will choose as his Treasury secretary and as investors continue to absorb the possible impact on the U.S. economy from proposed tax cuts and import tariffs.
Premarket Movers
Alphabet was down 0.8% after Bloomberg reported the Department of Justice will be asking a judge to force the company's Google unit to sell off its Chrome browser.
MicroStrategy fell 1.2%. The company will be selling a $1.75 billion issue of convertible bonds and plans to use the proceeds to buy additional Bitcoin.
Super Micro Computer rose 30% in premarket trading after the server maker late Monday appointed an independent auditor and submitted a plan with Nasdaq that it believes supports its request for an extension of time to regain compliance with Nasdaq listing requirements.
Symbotic swung to a profit in the fourth quarter as revenue jumped 19%. Shares rose 27%.
Postmarket Movers
Chicago Rivet & Machine slashed its quarterly dividend to three cents from 10 cents, citing macroeconomic headwinds that are weighing on its performance. Shares fell 5.9%.
Watch For:
Housing Starts; Canada CPI; Walmart earnings
Today's Headlines/Must Reads:
-Biden Team Races to Deliver Chip Grants Before Trump Takes Over
-Antitrust Enforcers Prepare Final Blitz Against Big Tech
-Chinese Equities Face Another Volatile Year as Policy Clouds Gather At Home and Abroad
MARKET WRAPS
Forex:
The dollar was steady following its recent rally.
UniCredit Research said investors appear to have "ridden the Trump trade enough for now" and are taking a pause in anticipation of more U.S. data and early indications of the extent to which the president-elect's economic policies will be implemented next year.
ING said the dollar could fall if Trump's nomination for the influential post of Treasury Secretary is not well received by the bond market.
A candidate with less experience or who offers little counterweight to some of Trump's plans would see long-term Treasuries sell off and potentially soften the dollar, ING said, but a candidate with proven reliability would be well received by the bond market.
Energy:
Oil prices were lower with the outlook of ample global supply against weak demand remaining supportive of bearish positions, Swissquote Bank said.
There are technical signs that investors have priced in an oversupplied oil market, which could cap the upside potential of short-term price rallies, and solid resistance is being seen in the $70-$72 a barrel range.
Metals:
Gold futures rose, helped by a weaker dollar and easing Treasury yields.
Geopolitical risks have reemerged, driving safe-haven demand for gold and solidifying its role as a reliable hedge, Pepperstone said, but the precious metal's future trajectory has split market opinions.
It could sink to lower price levels if the Fed tightens monetary policy, or conversely hit fresh highs if central bank purchases stay strong into 2025, Pepperstone said,
Either way, lingering monetary policy and the broader economic outlook continue to amplify gold's appeal as a hedge against volatility, it added.
RHB Retail Research said comex gold futures are looking to resume their uptrend after establishing an interim base on the daily chart on Monday. The precious metal formed a long bullish candlestick overnight, signaling upward momentum is gathering pace.
TODAY'S TOP HEADLINES
Makers of Weight-Loss Drugs Want Your Employer to Pay for Them
On a spring day this year, the New Jersey State Policemen's Benevolent Association received three unusual visitors: pharmaceutical representatives from Eli Lilly.
Lilly's reps presented a slide deck that laid out data on the effectiveness of Lilly's weight-loss drug Zepbound. The goal of the hourlong meeting with association leaders was to cement one core message: Obesity care is healthcare.
Blackstone Nears Deal for Jersey Mike's Subs
Private-equity giant Blackstone is nearing a deal for closely held Jersey Mike's Subs in a deal that would value the sandwich chain at around $8 billion, including debt, according to people familiar with the matter.
How Spirit Airlines Went From Industry Maverick to Chapter 11 Bankruptcy
The U.S. government envisioned that Spirit Airlines could stand up to industry behemoths on its own. It hasn't worked out that way.
The budget airline trailblazer filed for bankruptcy Monday, less than a year after a federal judge sided with the Justice Department and blocked its planned merger with JetBlue Airways. Deal opponents argued that eliminating Spirit would harm consumers because cheap seats would disappear and surviving carriers would raise fares.
Things Are Quiet in Consumer Credit. Too Quiet.
Lenders are open for business. But there might not be a ton of borrowers walking through the door. That can be a formula for trouble.
It should be a pretty good time to be lending money to people. Interest rates on credit cards have been at the highest levels since at least the 1990s, while the risk of card lending is subsiding. For the first time since 2021, the rate at which new delinquencies were forming actually declined in the third quarter from the prior quarter, according to the New York Fed. The four-quarter moving sum of the percentage of balances becoming 30-plus-days past due fell 0.26 percentage point from the second quarter to the third, to 8.79%.
Wall Street Is Bullish on Car Loans Despite Rising Delinquencies
More Americans are falling behind on their car payments. Wall Street isn't worried.
Investors are snapping up bonds tied to car loans, betting that a strong U.S. economy will keep rising delinquency rates in check. Sales of bonds backed by the riskiest auto loans to subprime borrowers hit nearly $40 billion this year through October, up 17% from all of 2023, according to data from JPMorgan Chase.
Big Cities Take Up Fight Against Algorithm-Based Rents
The federal government's price-fixing lawsuit against rental-software firm RealPage could take years to resolve. Rather than wait, some cities and states are already cracking down on the company.
San Francisco and Philadelphia passed laws in recent months to restrict the use of algorithmic rent-pricing systems at residential properties. Legislators in San Diego, New Jersey and other cities and states are considering new laws.
Can Trump's Hardball Tactics on China Ease America's Fentanyl Crisis?
BEIJING-Three days after Donald Trump won the presidency, China announced that, working with intelligence provided by the U.S., it had arrested a suspected longtime producer of chemicals used to make fentanyl. It was a modest gesture of goodwill by Beijing after intense pressure from Washington to crack down.
For the incoming administration, it was likely too little, too late.
Israel Finds Large Troves of Russian Arms in Hezbollah's Hands
TEL AVIV-As Israel advances its invasion of southern Lebanon, its troops are finding large troves of Russian weapons, confirming longstanding suspicions in Israel that Hezbollah is enhancing its fighting capacity with the help of sophisticated Russian arms.
Some of the weapons, which include modern Kornet antitank missiles manufactured as recently as 2020, were sent to southern Lebanon in recent years from Russian stockpiles in neighboring Syria, according to Syrian security officials and an Arab official. Russia has long provided arms to Syria's military, as well as controlling its own warehouses in the country.
Write to paul.larkins@dowjones.com TODAY IN CANADA
Earnings:
None Scheduled
Economic Calendar [ET]:
0830 Oct CPI
Expected Major Events for Tuesday
09:30/UK: Oct Monthly Insolvency statistics
10:00/ITA: Sep Balance of Payments
13:30/US: Oct New Residential Construction - Housing Starts and Building Permits
13:30/CAN: Oct CPI
13:55/US: 11/16 Johnson Redbook Retail Sales Index
15:00/US: 3Q Quarterly Retail E-Commerce Sales
15:00/US: Oct State Employment and Unemployment
21:30/US: API Weekly Statistical Bulletin
23:50/JPN: Oct Provisional Trade Statistics for the Month
All times in GMT. Powered by Kantar Media and Dow Jones.
Expected Earnings for Tuesday
Advent Technologies Holdings Inc $(ADN)$ is expected to report for 3Q.
Alaunos Therapeutics Inc (TCRT) is expected to report for 3Q.
Algorhythm Holdings Inc (MICS) is expected to report for 3Q.
Beam Global (BEEM) is expected to report for 3Q.
CervoMed Inc (CRVO) is expected to report $-0.54 for 3Q.
ClearOne Inc $(CLRO)$ is expected to report for 3Q.
D-Box Technologies Inc - Class A (DBO.T,DBOXF) is expected to report for 2Q.
Energizer Holdings Inc $(ENR)$ is expected to report $1.16 for 4Q.
Evofem Biosciences Inc (EVFM) is expected to report for 3Q.
Finch Therapeutics Group Inc (FNCH) is expected to report for 3Q.
GLG Life Tech Corp (GLG.H.V,GLGLF) is expected to report for 3Q.
GT Biopharma Inc $(GTBP)$ is expected to report for 3Q.
Galera Therapeutics Inc (GRTX) is expected to report for 3Q.
George Weston Ltd (WN.T,WNGRF) is expected to report for 3Q.
Gritstone bio Inc (GRTSQ) is expected to report $-0.66 for 3Q.
Jacobs Solutions Inc $(J)$ is expected to report $1.24 for 4Q.
Lowe's Cos $(LOW)$ is expected to report $2.82 for 3Q.
Mannatech Inc $(MTEX)$ is expected to report for 3Q.
(MORE TO FOLLOW) Dow Jones Newswires
November 19, 2024 05:51 ET (10:51 GMT)
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