2024-09-13 01:03
August producer prices slightly above estimates Moderna tumbles after dour FY25 revenue forecast Warner Brothers Discovery rises 10% on Charter deal Indexes up: Dow 0.58%, S&P 500 0.75%, Nasdaq 1.00% Sept 12 (Reuters) - Wall Street's main indexes closed higher on Thursday after the latest inflation data reinforced expectations for a 25-basis point rate cut by the Federal Reserve, while Moderna's weak revenue forecast made it the S&P 500's biggest percentage loser. The producer price index (PPI) for final demand rose 0.2% in August, compared with estimates for 0.1% growth. The core number, which strips out volatile food and energy prices, rose 0.3%, higher than the 0.2% forecast. Separately, initial claims for state unemployment benefits stood at 230,000 for the week ended Sept. 7, in line with estimates. "This week's data pretty much confirms that we're not likely to have a hard landing and that we're in a soft landing," said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia. "As long as investors see that interest rate cut and a path forward for interest rate cuts they're excited about prospects in the stock market and especially the growthier sections." A string of weakening employment and economic growth data in the past few weeks had fueled some bets on a larger-than-usual 50-bps interest rate cut by the Fed, but these bets had faded after Wednesday's inflation report. While on Thursday the bets fluctuated, traders were still betting on a 69% chance the U.S. central bank cuts rates by just 25 bps when it meets on Sept. 17-18, CME's FedWatch Tool showed. It would be the first rate cut since March 2020. The Dow Jones Industrial Average (.DJI) , opens new tab rose 235.06 points, or 0.58%, to 41,096.77, the S&P 500 (.SPX) , opens new tab gained 41.63 points, or 0.75%, to 5,595.76 and the Nasdaq Composite (.IXIC) , opens new tab gained 174.15 points, or 1.00%, to 17,569.68. The more economically sensitive small-cap Russell 2000 (.RUT) , opens new tab outperformed with a 1.2% gain. "There's probably some bargain hunting. Small caps is an area that's lagged all year and they'll tend to be rate sensitive so if rates are coming down that might have a decent impact," said Chuck Carlson, CEO of Horizon Investment Services in Hammond, Indiana. All of the S&P 500's 11 industry sectors ended higher, led by communication services (.SPLRCL) , opens new tab, which added 2%. The sector's biggest percentage gainer was Warner Bros Discovery (WBD.O) , opens new tab, which advanced 10.4% after it announced with Charter Communications (CHTR.O) , opens new tab that the cable company would provide customers an ad-supported version of Warner's streaming services Max and Discovery+. Charter shares rose 3.6%. Moderna (MRNA.O) , opens new tab finished down 12.4% after hitting its lowest level since November. The vaccine maker had forecast sales of $2.5 billion to $3.5 billion next year, below analysts' estimates. In more bullish news, Kroger (KR.N) , opens new tab shares rallied 7.2% after the supermarket chain beat second-quarter estimates and raised the lower end of its annual sales forecast. Shares of gold miners jumped as spot gold hit a record high, with the Arca Gold BUGS index (.HUI) , opens new tab rising 5.8%. Advancing issues outnumbered decliners by a 3.45-to-1 ratio on the NYSE where there were 405 new highs and 46 new lows. On the Nasdaq, 2,665 stocks rose and 1,543 fell as advancing issues outnumbered decliners by a 1.73-to-1 ratio. The S&P 500 posted 37 new 52-week highs and no new lows while the Nasdaq Composite recorded 73 new highs and 76 new lows. On U.S. exchanges 10.58 billion shares changed hands compared with the 10.82 billion moving average for the last 20 sessions. Sign up here. https://www.reuters.com/markets/us/futures-marginally-higher-ahead-jobless-claims-numbers-2024-09-12/
2024-09-13 00:39
WELLINGTON, Sept 13 (Reuters) - New Zealand house prices rose in the last month, with the data indicating more confidence in the market, the Real Estate Institute of New Zealand (REINZ) said on Thursday. Seasonally adjusted median house prices in August rose 2.1% on July, but were down 0.6% from August 2023, REINZ data showed. The number of houses sold nationally on a seasonally adjusted basis fell 2.4% on July and were down 0.5% on the previous year. The Real Estate Institute of New Zealand said its August 2024 figures showed signs of increased confidence, optimism and activity compared to the previous year, while the overall sales volume slightly declined, several regions reported notable increases in activity. Sign up here. https://www.reuters.com/markets/new-zealand-house-prices-rise-month-more-confidence-market-survey-says-2024-09-13/
2024-09-13 00:35
LONDON, Sept 12 (Reuters) - Interest rate cuts from major central banks are well underway, with the European Central Bank on Thursday delivering its second quarter-point cut of the year. Half of the 10 big developed market central banks tracked by Reuters have now started easing policy, and the U.S. Federal Reserve is likely to join the club next week. Here's where major rate setters stand and what traders expect next. 1/ SWITZERLAND The Swiss National Bank, the first among Western peers to lower borrowing costs in March, cut rates again in June to 1.25%. It has signaled it intends to keep going. Futures markets view another cut on Sept. 26 as certain, with 28% odds of a 50 basis point (bps) move, after annual inflation dropped to 1.1% in August. Outgoing SNB chair Thomas Jordan believes a stronger franc threatens exports. 2/ CANADA The Bank of Canada implemented its third consecutive cut on Sept. 4 to 4.25% and another 25 bps reduction in October is almost fully priced. Canada's economy is slack, strong population growth has helped lift unemployment to 6.6% and the BoC has mused about inflation undershooting its 2% target. 3/ SWEDEN Sweden's Riksbank, which started cutting rates in May after its successive hikes crushed inflation but weakened the economy, is tipped to lower borrowing costs by at least another 25 bps on Sept. 25. Swedish rates stand at 3.5% but annual inflation has steadied at below the Riksbank's 2% target. 4/ EURO ZONE The ECB cut rates again on Thursday as euro zone inflation slows and the economy falters. It provided almost no clues about its next step, even as investors bet on steady policy easing in the months ahead. Money markets priced in roughly 40 bps of further easing by year-end and a roughly 42% chance of another 25 bps cut in October. 5/ BRITAIN The Bank of England is expected to keep benchmark borrowing costs at 5% on Sept. 19, following its first cut of this cycle in August. Stubborn services inflation suggests the BoE will ease more slowly than the Fed and the ECB. Markets price just one more quarter point cut in 2024, probably in November. 6/ NEW ZEALAND A convention for quarterly instead of monthly GDP and inflation data has baffled New Zealand's central bank and domestic market watchers. The Reserve Bank of New Zealand in August cut rates for the first time this cycle to 5.25%, a year earlier than its own projections had stated. Markets forecast another quarter point drop in October. 7/ UNITED STATES The next Fed rate decision is on Sept. 18 and markets are gripped by the prospect of the first U.S. rate cut since 2020. Policymaker comments signal a cut is coming without suggesting one is needed because the economy is teetering on recession. Money markets reckon a 25 bps reduction next week is more likely than a bigger 50 bps cut after data on Wednesday showed some stickiness in underlying inflation. Traders price roughly 100 bps of easing by year-end while economists polled by Reuters forecast 75 bps worth. 8/ NORWAY Norway's central bank, which meets next week, is in the hawkish camp. It left rates on hold at a 16-year high of 4.5% in August and said a tight stance would likely be needed for "some time" to curb inflation, still running above the bank's 2% target. Markets only fully price in a first rate cut in December, meaning Norway's easing cycle will likely start well after peers. 9/ AUSTRALIA The Reserve Bank of Australia has held rates at 4.35% since last November and believes inflation is still sticky, although data suggests the economy is struggling. Markets do not see more than 50% odds of a rate cut until December. 10/ JAPAN The Bank of Japan is the outlier, raising rates twice this year as inflation rises. Its July rate increase caught markets off guard, exacerbating a sell-off in Japan's stocks and a surge in the yen. The BoJ says it will tread carefully to ensure volatile markets do not hurt businesses. It is expected to leave rates unchanged at 0.25% next week. Markets and economists anticipate another increase by year-end. Sign up here. https://www.reuters.com/markets/global-rate-cutting-cycle-picking-up-pace-2024-09-12/
2024-09-13 00:28
BERLIN, Sept 12 (Reuters) - The German government rejects a total ban on toxic "forever chemicals" found in many household and everyday items, Chancellor Olaf Scholz said on Thursday. Speaking at a chemical industry conference, Scholz said that where there are no alternatives, the use of so-called PFAS substances must remain possible, for example in the case of medical products, semiconductors and electrolysers. Forever chemicals are used in thousands of products and machines, including drugs, cars, textiles and wind turbines due to their long-term resistance to extreme temperatures and corrosion. In February last year, the EU started to consider a ban of the substances, in what could become the bloc's most extensive piece of regulation of the chemical industry. Sign up here. https://www.reuters.com/markets/commodities/german-government-rejects-total-ban-forever-chemicals-says-scholz-2024-09-13/
2024-09-12 23:56
Sept 12 (Reuters) - TC Energy's (TRP.TO) , opens new tab Coastal GasLink pipeline in western Canada has been fined C$590,000 ($434,558) for 10 environmental non-compliance penalties, the British Columbia government said on Thursday, taking its total penalties to nearly C$1.4 million. British Columbia's Environmental Assessment Office imposed the penalties because of concerns about deficient erosion and sediment control measures that were identified during inspections along the pipeline construction route in April and May 2023. "These latest financial penalties reflect the EAO's escalation of enforcement due to repeated non-compliance with EAO requirements," the regulator said in a news release. Coastal GasLink was completed last November and connects gas fields in northwestern British Columbia with the Shell-led (SHEL.L) , opens new tab LNG Canada project, which will be Canada's first liquefied natural gas project when it starts operating next year. "As soon as these issues were identified, we took immediate and decisive action to correct them," Coastal GasLink said in a statement, adding it had been fully compliant with the EAO on erosion and sediment control since autumn 2023. The 670-kilometre (416-mile) has incurred a five previous penalties totaling more than C$800,000 for environmental infractions. ($1 = 1.3577 Canadian dollars) Sign up here. https://www.reuters.com/business/energy/tc-energys-coastal-gaslink-pipeline-fined-again-environmental-non-compliance-2024-09-12/
2024-09-12 22:54
WASHINGTON, Sept 12 (Reuters) - The White House announced a new task force to deal with the growing needs of AI infrastructure after a meeting on Thursday between senior U.S. officials and top technology and power company executives. Led by the National Economic Council, the National Security Council and others, the task force will coordinate policies to advance data center development while weighing economic, national security, and environmental goals, the White House said. OpenAI CEO Sam Altman, Google (GOOGL.O) , opens new tab senior executive Ruth Porat and Anthropic CEO Dario Amodei were among the tech company representatives who attended the meeting. The White House said participants discussed how to meet clean energy, permitting and workforce requirements for developing data centers and power infrastructure needed for advanced AI operations. Generative AI, or GenAI, can create text, photos and videos in response to open-ended prompts. It has generated buzz about its potential uses such as relieving mundane tasks but also prompted fears about potential misuse. AI can strain the energy industry as U.S. technology companies seek to secure a shrinking supply of electricity for their rapidly expanding data centers. Energy Secretary Jennifer Granholm and Commerce Secretary Gina Raimondo also participated in the meeting. Granholm told Reuters in June that President Joe Biden's administration was asking technology companies to invest in new climate-friendly power generation to cover their surging demand. The surge in demand from AI could complicate Biden's target of decarbonizing the power sector by 2035 to fight climate change. "President Biden and Vice President Harris are committed to deepening U.S. leadership in AI by ensuring data centers are built in the United States while ensuring the technology is developed responsibly," said White House spokesperson Robyn Patterson. National security adviser Jake Sullivan as well as White House Chief of Staff Jeff Zients and National Economic Council Director Lael Brainard also took part, along with top Biden administration climate officials. The meeting shows that the White House recognizes the priority of infrastructure to create jobs and help guarantee that the benefits of AI are widely distributed, OpenAI said. "OpenAI believes infrastructure is destiny and that building additional infrastructure in the U.S. is critical to the country's industrial policy and economic future," a company spokesperson said. Sign up here. https://www.reuters.com/technology/us-officials-meet-with-top-tech-executives-powering-ai-cnn-2024-09-12/
