MARKET SNAPSHOT
U.S. stocks rose as investors greeted the appointment of Scott Bessent to lead the Treasury Department, amid hopes he could blunt some potentially inflationary policies. Treasury yields fell in response to the nomination. Oil futures dropped amid expectations of an imminent ceasefire agreement between Israel and Hezbollah. Gold prices fell sharply, despite weakness in the dollar.
MARKET WRAPS
EQUITIES
Donald Trump's pick of Scott Bessent for Treasury Secretary helped lift stocks and prompted a major rally in Treasurys, with investors betting that the long-time investor might reduce risks around tariffs and the budget deficit.
All three major indexes advanced, building on gains from last week.
Bessent, whom Trump chose on Friday after markets had closed, is widely viewed on Wall Street as a moderate figure who could temper Trump's more populist instincts on trade and fiscal policies.
The Dow Jones Industrial Average led gains, rising 1%. The S&P 500 and Nasdaq Composite both ticked up 0.3%.
Earlier Monday, Chinese shares ended mixed, as investors awaited China PMI and industrial-profit data.
The Shanghai Composite Index slipped 0.1%, the Shenzhen Composite Index added 0.4% and the ChiNext Price Index was flat. Hong Kong's Hang Seng Index shed 0.4%, weighed by insurance and tech companies.
Japan's Nikkei Stock Average climbed 1.3%, led by gains in electronics and chemical stocks, as signs of U.S. economic strength raise hopes for earnings growth.
Stocks in Australia rose, as the S&P/ASX 200 Benchmark Index increased 0.3%, the second consecutive day of gains.
New Zealand's NZX-50 rose 1.2%, hitting its highest closing level since October 2021 as investors prepare for the central bank's rate-setting meeting.
COMMODITIES
Oil futures ended lower, with talk of a potential cease-fire deal between Israel and Lebanon-based Hezbollah leading prices to shrink their "security premium," pulling global benchmark crude prices down by nearly 3%.
West Texas Intermediate crude for January delivery gave back 3.2% to settle at $68.94 a barrel on the New York Mercantile Exchange. January Brent crude declined by 2.9%, settling at $73.01 a barrel on ICE Futures Europe.
Oil prices saw a "reduction in the security premium related to the Mideast war," said Michael Lynch, president at Strategic Energy & Economic Research.
Front month Comex gold for November delivery sank 3.4% to settle at $2,616.80 per troy ounce.
That was the largest one-day drop by dollar amount for gold since November 2020.
TODAY'S TOP HEADLINES
Scott Bessent Sees a Coming 'Global Economic Reordering.' He Wants to Be Part of It.
Scott Bessent spent the past 40 years studying economic history. Now, as Donald Trump's choice to lead the Treasury Department, he has the chance to make his mark on it.
As a hedge-fund manager, first at George Soros's firm and later at his own, Bessent specialized in macroinvesting, or analyzing geopolitical situations and economic data to wager on big-picture market moves. He generated billions of dollars in profits betting on and against currencies, interest rates, stocks and other asset classes around the world.
He was motivated to step out from behind his desk and get involved with Trump's campaign in part because of a view that time is running out for the U.S. economy to grow its way out of excessive budget deficits and indebtedness.
Backlash Against Chinese Steel Gives Preview of Trump Trade Tensions
China's industrial overcapacity became an issue of global concern even before the election of Donald Trump. Now his threat to place tariffs of 60% or more on Chinese exports will elevate the issue even further. There is perhaps no better example than steel to illustrate the problem.
China is by far the biggest steel producer in the world, accounting for more than half of the world's production. The country had been able to absorb a big chunk of steel with its booming construction and manufacturing. But with the implosion of its housing market, sluggish domestic demand has given rise to excess supply for the rest of the world.
Because of the sheer size of China's steel industry-which produced around 1 billion metric tons last year-fluctuations in its domestic demand can send shock waves to the rest of the world. China's net exports of steel reached a record 10.6 million metric tons in October. In the first 10 months this year, China shipped 92 million metric tons of steel abroad. That is more than 10% of total steel production outside China, or more than what the U.S. produced for the whole of 2023.
Hong Kong Is Becoming Hub for Financial Crime, U.S. Lawmakers Say
Leading China hawks in the U.S. House of Representatives are calling for a rethink on whether Hong Kong should continue to enjoy the cozy banking relationship it has with the U.S., saying the city is becoming a hub for money-laundering and sanctions evasion.
Hong Kong has turned into a major center for the export of controlled Western technology to Russia; the creation of front companies to buy Iranian oil; the managing of "ghost ships" that serve North Korea, as well as other violations of U.S. trade controls, the bipartisan leaders of the House Select Committee on the Chinese Communist Party said in a letter to Treasury Secretary Janet Yellen.
The letter was signed by Rep. John Moolenaar, a Michigan Republican who chairs the committee, and Rep. Raja Krishnamoorthi, an Illinois Democrat who is the committee's ranking member. The Wall Street Journal reviewed a draft of the letter, which was publicly released Monday.
Macy's Says Accounting Employee Hid Up to $154 Million in Delivery Expenses
Macy's delayed its quarterly results after the company discovered that an employee had hidden up to $154 million in corporate delivery expenses over several years, prompting an investigation.
The retailer said Monday that a single employee, responsible for small-package delivery expense accounting, had intentionally made erroneous bookkeeping entries since late 2021.
The individual didn't pocket the amounts in question and the company declined to say how it uncovered the erroneous entries or how it went undetected by the company's auditor, KPMG. Macy's said it would provide details on its investigation when it reports quarterly results on Dec. 11.
Starbucks, Other Retailers Hit by Ransomware Attack on Tech Provider
A ransomware attack against a major supply chain technology provider left retailers including Starbucks and U.K. grocery chain Sainsbury's scrambling to manage operations including scheduling and handling inventories.
Blue Yonder, one of the world's largest supply chain software providers, said Monday it was working to restore services after the attack last week disrupted systems it hosts for customers.
Blue Yonder said it didn't have a timeline for when services would be restored. The company said the attack didn't affect systems that run on public cloud-based platforms.
Thyssenkrupp Steel to Cut 11,000 Jobs
Thyssenkrupp Steel plans to shrink its workforce by around 40%, reducing 11,000 positions as it braces for a more challenging market.
The steel business of the German industrial group on Monday outlined a series of measures-including job cuts, outsourcing and business sales-to boost its competitiveness, which the company sees as under threat from industry overcapacity and the rise of cheap exports, particularly from Asia.
The move comes as parent company Thyssenkrupp is seeking to reduce its ownership in the steel unit, which has weighed on the group's earnings lately, by forming a 50-50 joint venture with Czech billionaire Daniel Kretinsky's EP Corporate Group.
Expected Major Events for Tuesday
02:00/SKA: Oct Department store sales
05:00/SIN: Oct Industrial Production Index
08:30/HK: Oct External Merchandise Trade
08:59/JPN: Nov Monthly Economic Report
10:59/THA: Oct Trade data
21:00/SKA: Dec Business Survey Index
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(END) Dow Jones Newswires
November 25, 2024 16:57 ET (21:57 GMT)
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