OPENING CALL
Stock futures and bond yields were a fraction lower early Thursday as traders awaited economic updates that may color the Federal Reserve's decision making on monetary policy.
A number of Fed officials have stressed that the pace of interest rate reductions may be slowed if the trend for disinflation stalls.
"With inflation expectations moving higher, markets continued to pare back near-term Fed rate cut expectations, with the market odds of a December rate cut falling to 52% from 59% the previous day," Deutsche Bank said.
"The 13 basis points of easing now priced for the December meeting is the lowest that it's been since April."
Tech shares were declining the most following quarterly earnings from Nvidia .
Global indexes mostly dropped.
In Europe, investors were skittish after Ukraine's air force said Russia had fired an intercontinental ballistic missile into Ukraine, possibly escalating the conflict. This week, Ukraine fired long-range missiles provided by the U.S. into Russia for the first time.
Premarket Movers
Alphabet fell 0.4% after the Justice Department asked a federal judge on Wednesday to force Google to sell off its Chrome browser and be prevented from giving preferential access to its search engine on devices that use its Android mobile operating system.
U.S.-listed shares of Baidu were down 2.7% after third-quarter revenue fell 3% from a year earlier on continued weak advertising demand.
MicroStrategy was rising 9.3% after shares of the company, the largest corporate holder of Bitcoin, closed at a record high Wednesday following the sale of a larger-than-expected $2.6 billion of convertible bonds that it will use to buy more of the world's largest cryptocurrency.
Nvidia stock was down 3.1% after the company said it expects fourth-quarter revenue of $37.5 billion at the midpoint, higher than consensus of $37.1 billion but not enough to excite investors.
Palo Alto Networks was down 4.8% even after the cybersecurity company raised its fiscal-year guidance, saying its expects revenue of between $9.12 billion to $9.17 billion. Analysts had been expecting revenue of $9.13 billion.
Snowflake rose 20% after it posted third-quarter adjusted earnings and revenue higher than forecasts.
Target rose 0.3% after the stock fell 21% following third-quarter earnings that widely missed estimates.
Postmarket Movers
Dream Finders Homes was selected to join the S&P SmallCap 600 effective Nov. 25, replacing Haynes International. Shares rose 9.9%.
Watch For:
Weekly Jobless Claims; Existing Home Sales for October; earnings from Deere, Gap, Intuit
Today's Headlines/Must Reads:
-Nvidia's Coming Year Will Be a Turbulent One
-The Trump Stock Euphoria Starts to Fade
-The AI Effect: Amazon Sees Nearly 1 Billion Cyber Threats a Day
-MicroStrategy's Magical Bitcoin Buying Machine Uses Some Wacky Math
MARKET WRAPS
Forex:
The dollar is likely to continue trading in a higher range after its gains following the U.S. elections, ING said, with the market shifting away from pricing a December interest-rate cut by the Fed as it braces for second Donald Trump presidency.
Developments in overseas economies are also "far from encouraging."
Data including the initial jobless claims report are unlikely to move markets and the DXY dollar index should continue to trade in its new 106-107 range, ING said.
Bitcoin was soaring toward six figures for the first time ever as it extended its record-breaking rally.
The world's largest cryptocurrency climbed as much as 3.4% in early trading to top $97,000, before retreating slightly..
Bonds:
Inflation risks in Europe are lower than in the U.S, making European bonds more attractive than their U.S. peers, "....and the interest-rate differential is likely to widen further," J. Safra Sarasin Sustainable Asset Management said.
Given lower inflation risks in Europe, the European Central Bank is likely to make several rate cuts.
Energy:
Oil prices gained more than 1% as growing concerns over escalating tensions between Russia and Ukraine offset an unexpected rise in U.S. crude stockpiles.
"For oil, the risk is if Ukraine targets Russian energy infrastructure. The other risk is uncertainty over how Russia responds to these attacks, " ING said.
Meanwhile, U.S. crude oil inventories rose for the third straight week after increased inflow of imported supplies from the Gulf Coast, weighing on the demand outlook.
Metals:
Gold futures rose on safe-haven demand .
XS.com said intensifying tensions between Russia and Ukraine, exacerbated by Russia's latest nuclear threats, have driven investors to seek out stable assets like gold.
Nevertheless, gold's rally hasn't been as sharp as some traders expected, limited by the strength of the dollar.
Expectations of new monetary policy decisions by major banks-including the Fed-will likely influence both the dollar and gold prices in the coming months, XS.com said.
Comex gold futures' bullish momentum is accelerating, based on the daily chart. RHB Retail Research said the formation of a third straight bullish candlestick on Wednesday indicates that strong bullish momentum is underway.
Base metals were mixed.
ANZ said there were signs of improving fundamentals in the market.
Copper premiums on the Chinese spot market were up, after data showed retail sales expanded in October at the fastest pace in eight months, ANZ said.
China's cut to export taxes, set to kick in on Dec. 1, has also raised the prospect of tighter metals supplies globally.
Aluminum prices rose in Shanghai as Chinese fabricators rushed to front-load exports ahead of the repeal of the export tax rebate, ANZ added.
TODAY'S TOP HEADLINES
Deere's Earnings Are Dropping. The Next Results Are Due Thursday.
Thanksgiving is almost here, at the end of the U.S. harvest season. That means it is the end of Deere's fiscal year as well.
The tractor maker will give an outlook for 2025 when it reports its quarterly financial results on Thursday morning. Investors shouldn't expect much.
Apple Offers $100 Million Investment in Indonesia to Lift iPhone 16 Ban
Apple has proposed investing $100 million in Indonesia after the country banned sales of its latest iPhone 16 handsets over what officials say is the company's nonfulfillment of local investment requirements.
The amount the U.S. tech giant has offered is 10 times higher than an initial plan to invest $10 million to build an accessories and components factory in Bandung, West Java, the Ministry of Industry said in a statement Wednesday. The $100 million would be invested in over the next two years.
An Immigration Crackdown Risks Sapping Farms' Vital Source of Labor
The agriculture industry is working to avert a potential labor crunch following threats from President-elect Donald Trump to launch a mass deportation of migrants after he takes office.
America's food-supply chain relies on a predominantly immigrant workforce for some of its most challenging jobs, such as picking fruit, applying pesticides on crops, operating machinery and slaughtering livestock. About two-thirds of U.S. crop-farm workers are foreign-born, and 42% aren't legally authorized to work in the country, according to a Labor Department report.
Fed's Williams Sees Inflation Cooling and Interest Rates Falling Further
U.S. economic growth has surpassed expectations this year, even as inflation has cooled and the labor market has softened.
The outlook for 2025 is for more of the same, with an important caveat: The incoming Trump administration's fiscal policies could prove inflationary, creating headwinds for the Federal Reserve as it seeks to fulfill its dual mandate of promoting maximum employment and price stability.
BOJ Will Consider Impact of Weak Yen in Making Price Forecasts, Gov Ueda Says
TOKYO-Bank of Japan Gov. Kazuo Ueda said the central bank includes the possible impact of a weak yen on its price forecasts, although the stability of the currency market isn't one of its mandates.
"We do seriously take into account exchange rate movements in forming our economic and inflation outlook, including the question of what's causing the exchange rate changes that are taking place a the moment," Ueda said at an event held in Tokyo on Thursday. He refrained from making comments on short-term moves in the currency market.
Too Little, Too Late: Pro-Harris PAC Takes Flak for Spending Decisions
WASHINGTON-In mid-September, Kamala Harris's campaign signaled to its top donors that they should embrace a constellation of outside Democratic nonprofits and super PACs aimed at turning out Black, Latino and young voters. The statement was a cry for help.
For weeks, the groups had been complaining that Future Forward, the top Democratic outside group, had declined to share its resources throughout the spring and summer. The Harris campaign, meanwhile, was airing frustration that the super PAC had spent little of its hundreds of millions of dollars on negative advertising attempting to define Donald Trump.
Write to paul.larkins@dowjones.com TODAY IN CANADA
Earnings:
Real Matters 4Q
Economic Calendar:
0830 Sep Employment Insurance
0830 Oct Industrial Product, Raw Materials Price Indexes
Stocks to Watch:
Groupe Dynamite Prices IPO of Nearly 14.3M Shares at C$21 Each; Dynamite Subordinate Voting Shares Being Sold to Underwriters by Selling Shareholders for About C$300.0M in Gross Proceeds; Selling Shareholders Grant Underwriters Option to Purchase Up to 2.1M Additional Shares; Expects Offering to Close Nov. 26; Set IPO Range at C$19-C$23 a Share Last Week; Shares Expected to Begin Trading on TSX on Nov. 21 Under Symbol GRGD
Other News:
Canada's Liberal Government Agrees to Exempt Sales Tax on Some Goods, Services, Political Rival Says
(MORE TO FOLLOW) Dow Jones Newswires
November 21, 2024 05:48 ET (10:48 GMT)
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