News, reviews and company reports, NVidia's fall, market stability in anticipation of PCE
Market reviews
NVDA fell 6% after the report and finally erased the growth of US stock indices. Only DJIA remained in the plus by 0.5%. Small-cap stocks also outperformed the market. But overall, everything is calm. The PCE report today should strengthen expectations that the first rate cut is inevitable, but it may not clarify how quickly and to what extent the Fed will ease, market analysts believe. PCE is expected to remain at 2.5% y/y, and Core PCE will grow from 2.6% to 2.7%.
• World container shipping leader Maersk is buying engine maker Concentric for $840 million. Concentric shares rose 59% to 227 crowns.
• European gas traders are increasingly concerned about the risks of war in Ukraine. Most of all, about the immediate risks to supplies.
• Japan increases global bond market presence by most in 17 years, with Japanese funds buying the most foreign bonds since 2007.
• Rio Tinto, BYD and LG Energy bid for lithium project in Chile's Altoandinos. Mining giant Rio Tinto and Chinese electric vehicle maker BYD are among six companies eligible to submit proposals to develop a lithium project in Chile's Altoandinos salt flats, state-owned mining company ENAMI said on Thursday.
• Gap (GAP) saw second-quarter sales growth on solid demand. Old Navy net sales rose 8% from a year earlier, while the Gap brand grew 1%. The retailer reaffirmed its fiscal 2024 net sales and operating expense guidance and raised its gross profit expectations. Shares rose 1.7%.
• Treasury yields rose after solid data showed the Fed was taking a more restrained approach.
• Shares of Canadian Imperial Bank of Commerce jumped to their highest in more than two years after the bank reported earnings that beat analysts' forecasts and said problems with U.S. commercial real estate had eased.
• Shell to cut 20% of jobs in some oil and gas units as Chief Executive Wael Sawan works to improve efficiency and profitability.
• HP shares jumped after reporting their first sales gain since 2022, thanks to a rebound in corporate PC purchases. Sales rose 2.4% to $13.5 billion in the fiscal third quarter, the company said Wednesday. Analysts on average had forecast $13.4 billion. The gain was driven by a rebound in PC sales.
• Samsung has expressed interest in Nokia's mobile network assets. Nokia has considered several options, including selling part or all of its mobile network business, which could be valued at $10 billion, and merging the business with a competitor.
• Meta says its Llama Shi models are used by banks and tech companies.
• Goldman Sachs and AT&T are using the model for business functions such as customer service, document verification and computer code generation, the companies said in a statement.
• IBM and Intel said IBM Cloud will begin offering Gaudi 3 AI chips to customers early next year. Intel has found the first cloud customer for its Gaudi 3 AI accelerator: IBM Cloud. The chip's accelerators will be available for both hybrid and on-premises environments, and IBM says it plans to include support for Gaudi 3 in its Watsonx AI and data platform.
• Walmart and TD deals boost U.S. stock sales to highest level since May. Walmart Inc.'s $3.6 billion exit from China's JD-com Inc. helped make August the busiest month since May in the U.S. for sales of new and existing shares of public companies.
• U.S. auto sales will rise in August due to a surge over the Labor Day weekend, a report shows. Based on a seasonally adjusted annual rate (SAAR), which takes into account the timing of Labor Day, sales are expected to remain roughly flat at 15.3 million units.
• OpenAI and Anthropic Sign Agreements with US Government for AI Research and Testing Under the agreements, the US AI Safety Institute will have access to key new models from OpenAI and Anthropic before and after their public release. Apple and Nvidia are in talks to join OpenAI's $100 billion
funding round. ChatGPT now has over 200 million weekly active users. Their number has doubled in a year.
• OKTA fell 17% yesterday. The company beat expectations but gave weak guidance.
• NTNX rose 20% yesterday as the cloud computing company beat expectations and raised its guidance.
• AFRM rose 32% yesterday. The buy-now, pay-later company reported strong results and said it expects to "achieve GAAP operating profit margin in the fourth fiscal quarter of 2025."
• DG fell 32% yesterday. The discount retailer reported poor results and lowered its forecasts. This crushed its colleague DLTR by 10%.
• Stocks in the morning after reports in the morning after reports
MRVL +7%
LULU +4%
DELL +3%
ULTA -7%
International Reviews
• U.S. economic growth was revised up in the second quarter, driven by consumer spending.
Strong consumer spending, while corporate profits rebounded, should help support economic growth. Gross domestic product grew at an annualized rate of 3% in the April-June period, up from a previous estimate of 2.8%, according to the U.S. Bureau of Statistics.
• UK to delay bank capital reforms until at least January 2026. Britain's top financial regulator is set to delay the next wave of bank capital reforms.
• The U.S. pending home sales index fell to its lowest level ever. High prices and borrowing costs continue to discourage buyers. The National Association of Realtors' contract signing index fell 5.5% to 70.2 last month, the lowest ever.
• U.S. weekly jobless claims fall. The number of Americans filing new claims for unemployment benefits fell last week, but reemployment opportunities for laid-off workers are becoming increasingly scarce, suggesting the unemployment rate likely remained elevated in August.
• Fitch affirmed the US rating at AA+. The outlook is stable.
• Germany has a record low inflation rate in three years. In August, according to official data, its rate was only 1.9% instead of the predicted 2.1%. For comparison, in July, inflation in Germany was at 2.3%, in June - 2.2%. The main reason for the weakening of inflation was the fall in energy prices. Over the year, they have become cheaper by 5.1%. Prices for food and services have increased.
• The ABBA group demands that US presidential candidate Donald Trump not use their music during the election campaign, - The Gaze. Earlier, the singer Beyoncé banned Trump's team from using the video with her song Freedom after the track became the campaign anthem of the Democratic presidential candidate Kamala Harris. Trump was also banned from using hits by Adele, The Rolling Stones, Aerosmith.
• The Prague prosecutor's office has brought charges against the founder of the Czech fund Help Ukraine, Vladimir Gergel, for the theft of subsidies intended for the implementation of programs for the integration of Ukrainian refugees.
• Biden aide discusses war in Ukraine with Chinese leader. During talks in Beijing, Jake Sullivan expressed concerns to Xi Jinping about China's support for the Russian defense industry and the implications for European and transatlantic security. A number of international issues were also discussed, including China-Taiwan relations and the situation in the South China Sea./ China does NOT want to change its position on supporting Russia.
• We remind you that from September 1, China will introduce strict restrictions on the export of components for drone manufacturers (except for Russians, for sure). Ukraine urgently needs to look for alternative routes and alternative suppliers. And also try to implement Chinese import substitution. Beijing has long been an unreliable supplier. What the Russian Federation became earlier.
• Kamala Harris made her case in her first major interview with CNN since running for president. Why hasn't Kamala Harris implemented her economic plans yet? The US needed to recover from COVID first, she says.
• The Maldives are on the verge of default. The reason is problems with repaying external debt, a decrease in external financing and a reduction in foreign exchange reserves (from $700 million a year ago to $395 million as of the end of June).