Morning Archives - Page 2 of 3

February 3, 2022

Omicron in retreat, but jobs may be a victim of wave: Morning Brief

This article first appeared in the Morning Brief. Get the Morning Brief sent directly to your inbox every Monday to Friday by 6:30 a.m. ET. Subscribe

Thursday, February 3, 2022

Omicron wave retreats, leaving wreckage in its wake

Like a strong tide that crashes into a beach shore before it washes back out to sea, the Omicron variant of COVID-19 — which has spent months buffeting the global economy — is mercifully in retreat. But it’s leaving some debris in its wake.

On Wednesday, we learned that private payrolls plunged by over 300,000, according to ADP data. Yahoo Finance’s Emily McCormick reported that services jobs suffered the largest drop, led by industries most vulnerable to Omicron-related declines in foot traffic and business. Leisure and hospitality, the Achilles heels of a jobs market that otherwise remains hot, shed over 150,000 in January.

I am no fan of this particular data series, being that it’s an extremely imperfect indicator of the all important monthly nonfarm payrolls. However, the onset of Omicron has been creating lots of noise in a number of high frequency data sets — including weekly jobless claims — that are becoming more difficult to downplay.

Employers haven’t been shedding jobs en masse, and there are still far more employees voluntarily leaving their jobs for better opportunities than are being forced out.

Still, the ADP data is stoking fears over Friday’s payrolls data, and complicating the Biden administration’s ability to send a consistent message on the economy.

This week, Yahoo Finance’s Ben Werschkul reported that the White House is already “lowering expectations” about December’s jobs numbers, which may simultaneously make it harder for the Federal Reserve to kick off its interest rate hike campaign. The central bank now has to thread the needle between soaring inflation, and an economy that’s expected to lose momentum.

“If the payroll number is terrible, then you’ll see the Fed emphasize that it’s very data-dependent still,” Evercore ISI Vice Chairman Krishna Guha told Yahoo Finance Live on Wednesday.

“So we shouldn’t assume that that next hike… is set in stone. If necessary, they can even deliver the dovish hike in March,” Guha added.

One month, of course, does not make a trend. However, depending on how bad the January labor figures are — and whether that anticipated weakness carries over into February — they may have the perverse effect of temporarily boosting investor sentiment, given that the Fed’s hawkishness has put Wall Street in a particularly foul mood as of late.

Michael Pearce, senior U.S. economist at Capital Economics, noted that “with infection numbers and hospitalizations now falling in many parts of the country as quickly as they had risen, we expect a huge rebound in payrolls in February, with most of the disruption clearing by the end of the quarter.”

He added: “As a result, even a very bad January payrolls number is not going to be enough to cause the Fed to delay its planned March rate hike, though we do expect slowing economic growth this year to limit the Fed to four rate hikes, rather than the 5+ that markets are now pricing.”

By Javier E. David, editor at Yahoo Finance. Follow him at @Teflongeek

Editor’s note: We want your feedback. Please take this quick survey to let us know if we should launch another newsletter. If the answer is yes, what type of content should the newsletter include?

What to watch today

Economy

7:30 a.m. ET: Challenger Job Cuts, year over year, January (-75.3{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} prior)
8:30 a.m. ET: Nonfarm Productivity, fourth quarter preliminary (3.9{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} expected, -5.2{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} expected)
8:30 a.m. ET: Unit Labor Costs, fourth quarter preliminary (1.0{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} expected, 9.6{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} during prior quarter)
8:30 a.m. ET: Initial Jobless Claims, week ended Jan. 29 (245,000 expected, 260,000 during prior week)
8:30 a.m. ET: Continuing Claims, week ended Jan. 22 (1.620 million expected, 1.675 million
during prior week)
9:45 a.m. ET: Markit US Services PMI, January final (50.9 expected, 50.9 prior month)
9:45 a.m. ET: Markit US Composite PMI, January final (50.8 expected, 50.8 prior month);
10:00 a.m. ET: ISM Services Index, January (59.5 expected, 62.0 prior)
10:00 a.m. ET: Factory Orders, December (-0.4{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} expected, 1.6{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} final)
10:00 a.m. ET: Factory Orders Excluding Transportation, December (0.4{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} expected, 0.8{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} final)
10:00 a.m. ET: Durable Goods Orders, December final (-0.9{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} expected, -0.9{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} prior)
10:00 a.m. ET: Durable Goods Excluding Transportation, December final (0.4{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} prior)
10:00 a.m. ET: Capital Goods Orders Nondefense Excluding Aircrafts, December final (0.0{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a})
10:00 a.m. ET: Capital Goods Shipments Nondefense Excluding Aircrafts, December final (1.3{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a})

Earnings

Pre-market

6:30 a.m. ET: Cigna (CI) is expected to report adjusted earnings of $4.71 per share on revenue of $43.97 billion
Merck (MRK) is expected to report adjusted earnings of $1.54 per share on revenue of $13.19 billion
Eli Lilly & Co. (LLY) is expected to report adjusted earnings of $2.48 per share on revenue of $7.75 billion
Honeywell (HON) is expected to report adjusted earnings of $2.07 per share on revenue of $8.71 billion
Estee Lauder (EL) is expected to report adjusted earnings of $2.62 per share on revenue of $5.49 billion
Cardinal Health (CAH) is expected to report adjusted earnings of $1.25 per share on revenue of $45.34 billion

Post-market

4:05 p.m. ET: Ford (F) is expected to report adjusted earnings of $0.45 per share on revenue of $34.79 billion
Amazon (AMZN) is expected to report adjusted earnings of $7.80 per share on revenue of $137.83 billion
Snap (SNAP) is expected to report adjusted earnings of $0.11 per share on revenue of $1.20 billion
Pinterest (PINS) is expected to report adjusted earnings of $0.43 per share on revenue of $832.92 million
Activation Blizzard (ATVI) is expected to report adjusted earnings of $1.31 per share on revenue of $2.66 billion
Skechers (SKX) is expected to report adjusted earnings of $0.34 per share on revenue of $1.55 billion
GoPro (GPRO) is expected to report adjusted earnings of $0.35 per share on revenue of $382.75 million
Fortinet (FTNT) is expected to report adjusted earnings of $1.15 per share on revenue of $961.96 million
News Corp. (NWSA) is expected to report adjusted earnings of $0.33 per share on revenue of $2.64 billion
Unity Software (U) is expected to report an adjusted loss of $0.08 per share on revenue of $293.39 million

Politics

Three candidates for the Federal Reserve Board will get their nomination hearing today. Sarah Bloom Raskin, who is up for the influential vice chair of supervision role, as well as Lisa Cook and Philip Jefferson will take questions from senators beginning at 8:45 a.m. ET.
President Biden is traveling to New York City where he will meet with Mayor Eric Adams and Governor Kathy Hochul this afternoon. They are set to discuss gun crime and other issues. The president is also speaking at the National Prayer Breakfast in Washington this morning.
While a permanent fix is elusive in the standoff between airlines and companies like AT&T (T) and Verizon (VZ) over the rollout of 5G towers near airports, Federal Aviation Administration Administrator Steve Dickson will testify at a congressional hearing on the issue beginning at 11:00 a.m. ET.

Top News

Meta earnings miss expectations amid Apple privacy changes, stock plummets [Yahoo Finance]

Spotify plunges after Q4 earnings on weak guidance amid Rogan outcry [Yahoo Finance]

European markets muted as traders await BoE and ECB interest rates decision [Yahoo Finance UK]

Why PayPal stock is plunging [Yahoo Finance]

Yahoo Finance Highlights

Starbucks baristas behind union drive describe ‘super stressful’ workplace

All that COVID aid included $366 billion for the wealthy

Crypto salaries are on the rise, but there are pros and cons

—

Read the latest financial and business news from Yahoo Finance

Follow Yahoo Finance on Twitter, Instagram, YouTube, Facebook, Flipboard, and LinkedIn

January 17, 2022

Morning News Call – India, January 17

To access a PDF variation of this newsletter, make sure you simply click here https://share.refinitiv.com/assets/newsletters/Indiamorning/MNC_IN_01172022.pdf If you would like to acquire this e-newsletter via e-mail, be sure to register at: https://remedies.refinitiv.com/MNCIndiaSubscriptionpage Things TO Watch • 4:00 pm: Ultratech Cement management at Q3 analyst contact. • 6:30 pm: Prime Minister Narendra Modi and Bharti Enterprises Chairman Sunil Bharti Mittal at Davos Agenda summit of the Globe Economic Discussion board. • Manappuram Finance board fulfills to mull fund raising by using bonds in Thrissur. PROMOTION LIVECHAT-REUTERS International Marketplaces Forum Mike Dolan, Reuters Editor-at-Massive for Financial Sector & Fiscal Marketplaces, discusses themes in enjoy for the impending week. To be part of the dialogue at 4:30 pm IST, click on here https://www.refinitiv.com/en/solutions/refinitiv-messenger/international-markets-discussion board?utm_resource=Eloqua&utm_medium=electronic mail&utm_campaign=00013PM_IndiaMorningNewsletter_Other&utm_content material=MNCIN_011722 INDIA Leading Information • India’s December WPI inflation at 13.56{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} as companies struggle climbing costs India’s yearly wholesale cost-based inflation eased marginally in December to 13.56{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a}, but remained in double digits for a ninth successive month, reflecting rising enter fees for corporations, quite a few of which are steadily passing on charges to people. • India proposes mandatory aspect, curtain airbags in all cars from Oct India, which has amongst the world’s deadliest roads, on Saturday proposed mandating at minimum 6 air bags in all passenger cars made from Oct. 1. • Reliance, Ola Electric powered, Mahindra bid for incentives underneath India’s battery scheme Reliance Industries, Softbank Group-backed Ola Electric and automaker Mahindra & Mahindra have submitted bids less than the country’s $2.4 billion battery plan, the govt mentioned on Saturday. • Aditya Birla Style to acquire 51{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} stake in Dwelling of Masaba Aditya Birla Style and Retail mentioned on Friday it would acquire a 51{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} stake in Household of Masaba Way of living for about $12.14 million, as it seeks to reinforce its existence in the speedy escalating phase. • Indian Oil to invest $944 million on gasoline sales community in 9 new locations Indian Oil Corp, the country’s top refiner and gasoline retailer, aims to spend 944.02 million to make fuel gross sales community infrastructure, together with pipelines, in new spots, the enterprise explained on Sunday. • Hero Motocorp to make investments about $56 million in EV start out-up Ather Electrical power Hero Motocorp stated on Friday it would devote up to $56.66 million in electric powered motor vehicle (EV) start out-up Ather Power as it looks to expand its existence in the green mobility place. • Indian electric van maker for Amazon raises money Indian start off-up EVage, which is constructing electric shipping vans for e-commerce and logistics companies such as Amazon.com, has lifted $28 million from U.S.-centered enterprise cash organization RedBlue Funds, the organization explained on Friday. • Philippines to purchase missile program from India for $375 million The Philippines has finalised a deal to purchase a shore-primarily based anti-ship missile program from India for just about $375 million to beef up its navy, the Southeast Asian nation’s defence minister explained. World Major News • China’s Q4 GDP beats forecasts but momentum cooling China’s economic climate grew 4.{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} in the fourth quarter from a calendar year before, more rapidly than anticipated but its weakest enlargement in one particular-and-fifty percent decades, Countrywide Bureau of Stats knowledge confirmed on Monday. • Japan machinery orders rise much more than predicted, govt welcomes decide on-up symptoms Japan’s core equipment orders rose for a 2nd straight thirty day period in November, governing administration facts confirmed on Monday, a sign that company urge for food for cash investing remained resilient even with stress from soaring uncooked material selling prices. • Credit Suisse chief, architect of new approach, quits in excess of COVID-19 breaches Credit rating Suisse’s Chairman Antonio Horta-Osorio has resigned just after flouting COVID-19 quarantine policies, increasing questions over the embattled lender’s new strategy even as it attempts to get better from a string of scandals. Nearby Markets OUTLOOK (As noted by NewsRise) • SGX Nifty nearest-thirty day period futures had been trading .4{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} reduced at 18,197.00. • The Indian rupee is anticipated to decrease versus the U.S. currency nowadays following Treasury yields and the dollar index jumped even with weak U.S. info. • Indian sovereign bond yields are most likely to edge better in early trade, monitoring a jump in U.S. Treasury yields and crude oil prices. The produce on the benchmark 6.10{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} bond maturing in 2031 is probably to trade in the 6.56{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a}-6.61{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} band. World Markets • The Dow closed decrease on Friday with a massive drag from monetary shares as buyers were unhappy by fourth quarter success from big U.S. banking institutions, which solid a shadow over the earnings year kick-off. • Asian share marketplaces had been choppy as a slew of Chinese economic details verified the deadening outcome of coronavirus limitations on consumer expending, prompting Beijing to all over again ease financial plan. • The greenback clung to a late week bounce as buyers braced for January’s U.S. Federal Reserve meeting and raised bets it will chart a year in advance keeping a number of level hikes, whilst China amazed analysts with a benchmark slash. • U.S. Treasury yields were being greater on Friday in choppy trade as a batch of tender economic info on shopper and manufacturing action was seen as not adequate to derail the Federal Reserve’s route of tightening policy. • Oil charges rose, with Brent crude futures at their highest in additional than a few yrs, as traders guess provide will continue to be limited amid restrained output by key producers with international demand from customers unperturbed by the Omicron coronavirus variant. • Gold rates eased, as U.S. Treasury yields obtained on hawkish alerts from the Federal Reserve and markets commenced to selling price in a faster-than-predicted reduction in harmony sheet. Near FII INVESTMENTS EQUITIES Debt PNDF location 74.13/ January 14 (1370.86) crore 628.52 crore 74.16 10-yr bond yield 6.582{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} Thirty day period-to-day 1,857 crore 914 crore Calendar year-to-day — — (FII investment figures are in Indian rupees. Source: National Securities Depository Confined) For additional facts: India govt bond marketplace volumes Inventory market place experiences Non-deliverable forwards data Company credit card debt stories [IN CORPD] Area industry closing/intraday concentrations [IN SNAPSHOT] Every month inflows [INFLOWS RTRS TABLE IN] ($1 = 74.17 Indian rupees) (Compiled by Ananya Roy)

December 15, 2021

We need to talk about 2023 (yes, already): Morning Brief

This article first appeared in the Morning Brief. Get the Morning Brief sent directly to your inbox every Monday to Friday by 6:30 a.m. ET. Subscribe

Tuesday, December 14, 2021

With taper, rate hikes baked into 2022, the chickens may come home to roost in 2023

Buy the taper, sell the fact?

Stocks, which mostly rallied as Federal Reserve officials dropped hints that crisis-era monetary accommodation is nearing an end, are clearly showing signs of wear.

With the Omicron variant of COVID-19 becoming less of a factor for asset markets, signs are emerging that the Fed’s deliberative moves to pull back on purchasing bonds — and then begin a rate hike campaign sometime next year — are starting to worry investors. Seemingly runaway inflation is making both consumers and policymakers alike nervous, and complicating the Fed’s task of engineering a soft landing for the economy.

On Wednesday, markets will get more clarity about the Fed’s plans to taper bond purchases, and where it sees rates going in 2022. But the Morning Brief is here to give our readers the unvarnished truth, straight no chaser — and as ever, there’s both good and bad news.

Barring unforeseen circumstances, i.e. the appearance of a new variant or a global conflagration, for example, investors can probably relax about what 2022 has in store.

Famous last words, perhaps, but we know the Fed is all but certain to tighten monetary policy and growth is likely to slow from current levels — but not to such an extent that’ll cause a downturn. Meanwhile, impossibly tight labor conditions will probably keep unemployment low and available jobs high, for most if not all of next year.

According to Sam Stovall, chief investment strategist at CFRA Research, gross domestic product in 2022 “should remain above average not only for the U.S., but also for the globe,” with headline inflation peaking in the first quarter before tumbling by over half by Q4, he wrote on Monday.

Currently, most Wall Street economists expect the Fed to mete out just one to two rate hikes next year, but they may be forced to get more aggressive if inflation stays at current levels. And the picture could easily get more complicated once the calendar flips to January 2023.

A hawkish Fed, bond yields gyrations and a strong dollar have the potential to sow chaos in markets and the economy in 2023. That combination is something strategists at Deutsche Bank referred to as “late-cycle dynamics” that could put downward pressure on prices, but leave a “behind the curve” Fed with “a lot of catching up to do” after a prolonged period of easy money.

In fact, Deutsche’s chief economist Jim Reid noted on Monday that “a common pattern seen across hiking cycles is that growth tends to slow in the year after the hikes have commenced but not the one it takes place in.” The bank’s data found 13 different rate hike cycles in which a recession arrived 3 to 3.5 years later, on average.

Accounting for the lag between growth and changes to monetary policy, “on average, real GDP growth in the first year of the hiking cycle was +4.8{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a}, but that slowed to +2.7{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} in the second year, and +2.1{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} in the third year,” Reid said.

“Given the earliest that it took for a recession to materialize after a rate hike is 11 months, then statistically it does appear that 2022 has a very low probability of negative growth,” the economist said. “However the probabilities will build from 2023 onwards if history is to be believed.”

That timetable is consistent with a Bank of America forecast. The bank expects 2022 growth to decelerate from the current year, but check in at a still robust 3.5{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} annualized rate. Yet in 2023, the bank sees a markedly lower GDP print of 2.5{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a}, and an even less impressive 2.0{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} in 2024, as the wages of the Fed’s rate hike campaign catch up with the economy.

Arguably worse news is that based on Fed “dot plot” projections, the central bank is still expected to hike rates in 2023 and 2024 — part of the catch up work it needs to do to tame prices — even as the economy slows.

By Javier E. David, editor at Yahoo Finance. Follow him at @Teflongeek

Yahoo Finance Highlights

5 giant stocks are driving the S&P 500 to records: Goldman Sachs

‘Misery Index’ at recession-like level despite high growth: Oxford Economics

Why Build Back Better is so unloved

—

Read the latest financial and business news from Yahoo Finance

Follow Yahoo Finance on Twitter, Instagram, YouTube, Facebook, Flipboard, and LinkedIn

December 7, 2021

3 reasons why the stock market hates the omicron variant: Morning Brief

This article first appeared in the Morning Brief. Get the Morning Brief sent directly to your inbox every Monday to Friday by 6:30 a.m. ET. Subscribe

Monday, December 6, 2021

Most investors will enter this week confused after battling through another topsy-turvy trading week.

Bitcoin nosedived at its worst by 20{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} over the weekend (more on that below). Last week, the S&P 500 saw five straight losses of at least 1{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} at one point each day, according to Bloomberg data. Small-cap stocks as measured by the Russell 2000 are officially in a correction.

Does one brave these rockier waters and buy the dip? After all, the strategy has worked wonders in the past five years as markets have been awash in liquidity. What I say is to sit tight. Honestly, you shouldn’t be confused at all given the economic implications of the new Omicron variant (and potentially others) and the Federal Reserve soon pulling back the liquidity punch bowl.

I think the team at Goldman Sachs led by Jan Hatzius nicely summed up this weekend why you should be hesitant to buy dips in the market in the near-term. In other words, the market has been right to hate the Omicron variant:

“First, Omicron could slow economic reopening, but we expect only a modest drag on service spending because domestic virus-control policy and economic activity have become significantly less sensitive to virus spread.

Second, Omicron could exacerbate goods supply shortages if virus spread in other countries necessitates tight restrictions. This was a major problem during the Delta wave, but increases in vaccination rates in foreign trade partners since then should limit the scope for severe supply disruptions.

Third, Omicron could delay the timeline for some people feeling comfortable returning to work and cause worker shortages to linger somewhat longer.”

The read here: the market probably hasn’t priced in anything Hatzius discusses above from an economic standpoint. It’s currently in the process of figuring things out. Hatzius slashed his first quarter 2022 GDP estimate to 3{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} from 4.5{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} primarily due to the spreading Omicron variant.

Then the other component at play is in fact the new Jerome Powell-led Fed in 2022, one that is more focused on controlling inflation than providing support to asset markets. To that end, Bank of America’s Chief Investment Strategist Michael Hartnett sets the stage very well for 2022 in this new Fed era:

“2021-22 investment backdrop we say similar to early stagflation of late-60s, early70s … period of inflation & interest rates breaking higher from secular low/stable trading ranges on back of high budget deficits, Vietnam, “Great Society” policies, civil unrest, political and acquiescent Fed; late-60s/70s “stagflation” winners were real assets, real estate, commodities, volatility, cash, emerging markets, all of which held their own versus inflation; losers were bonds, credit, equities, tech, all of which ultimately struggled; we think we’re in the ’69-’71 period.”

Harnett is bearish on 2022, and expects a “rates shock” and tightening financial conditions.

Happy trading! And remember, what goes up must eventually come down.

Odds and ends

Cryptocurrency: Yahoo Finance Editor-in-chief Andy Serwer and crypto reporter David Hollerith did expert jobs this weekend covering the rout in bitcoin prices (down 20{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} at one point on Saturday). So I won’t spend a lot of time on it, other than to say exuberant crypto asset prices are about to be put to the test as the Fed moves off peak liquidity. Those asset prices could also be put to the test this week as the CEOs of six major crypto companies testify at a Dec. 8 hearing of the House Financial Services Committee titled “Digital Assets and the Future of Finance: Understanding the Challenges and Benefits of Financial Innovation in the United States.” I am very interested to see if execs from Paxos, FTX, Coinbase, Circle, Stellar Development Foundation and Bitfury tell the likes of Congresswoman Maxine Waters that they want more regulation. Now is the group’s chance to send along that message, which is one I have been hearing from crypto people for over a year. I’ll reiterate: Be careful what you wish for, crytoverse.

Stock market bubble: Berkshire Hathaway’s Charlie Munger’s comments last week on valuations being crazy just like the 2000 dot-com bubble were well taken. I don’t agree 100{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} with the billionaire’s hot take, but it doesn’t take a rocket scientist to see pockets of excess in all sorts of markets at the moment (even in a market off its mid-November record highs). But to push back on Munger’s musings, look no further than this year’s IPO market. Bank of America strategist Jill-Carey Hall points out the number of traditional (non-SPAC) deals year-to-date is tracking the highest since the aforementioned tech bubble of 2000. BUT, as a percentage of market cap, deal value is half of 1999 levels. Sure doesn’t look bubblelicious to me, but then again what do I know, Munger’s net worth is 4,000 times mine (a rough guess).

DocuSign: Friday was a session for DocuSign that falls under the category for me of “wow, I haven’t seen that in a while.” Shares crashed 42{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} by the close of trading as the company is experiencing slowing growth that took execs by surprise. Hat tip to DocuSign CEO Dan Springer for even coming on Yahoo Finance Live to talk with me and Zack Guzman, while the company’s stock plunged 40{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a}. Having said that, watch DocuSign for a short-term dead cat bounce this week — Springer told us he is buying $5 million in company stock on Tuesday because the market reaction looks very overdone. I suspect he won’t be alone in trying to pick the bottom.

Small-cap stocks: Few sectors have been harder hit during this two week or so sell-off than small caps, or those of companies with outsized exposure to the U.S. economy. The small-cap Russell 2000 has tanked 12{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} from its recent high on Nov. 8, per Yahoo Finance Plus data. Yahoo Finance’s markets wizard Jared Blikre notes on Twitter the iShares Russell 2000 ETF is now at “old” support levels on the charts. The selling pressure may not yet be over, small-cap experts contend.

“Given the uncertainty around the new variant and the economy, it is hard to see investors wanting to add risk heading into year-end,” says Steven DeSanctis, Jefferies’ small and mid-cap strategist (known on Wall Street as the “SMID” strategist). “When these issues are resolved, and we think that will be sooner rather than later, we see small spiking higher, like it has done numerous times since the low in March 2020. We would not be surprised to see a real January Effect with small leaping higher, beating large, and the cyclicals leading the way,”

Have no clue what the January Effect is? Give this a quick read from our friends at Investopedia.

Brian Sozzi is an editor-at-large and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.

Yahoo Finance Highlights

Wall Street’s 2022 outlook for stocks

2 big market risks for 2022, according to Bank of America

Doctor: We’re preparing for ‘a potential perfect storm’ with Omicron and winter

—

Read the latest financial and business news from Yahoo Finance

Follow Yahoo Finance on Twitter, Instagram, YouTube, Facebook, Flipboard, and LinkedIn

December 3, 2021

4 things to cheer as Omicron makes its dramatic entrance: Morning Brief

This article first appeared in the Morning Brief. Get the Morning Brief sent directly to your inbox every Monday to Friday by 6:30 a.m. ET. Subscribe

Thursday, December 2, 2021

‘The economic impact of COVID seems to be diminishing’

The Omicron variant of COVID-19 made its first domestic appearance on Wednesday, with one recorded case, a person who had traveled to South Africa and mildly symptomatic, being found in California. The news was enough to send stocks into a tailspin — again — and stoke new fears about efforts to contain the virus’ spread (i.e. mandates, restrictions and, perchance, more lockdowns).

“What a difference a week makes. A week ago stocks were at all-time highs and the economy was strong. Now all we have are uncertainties and questions,” explained LPL Financial Chief Market Strategist Ryan Detrick.

“As of now we’re optimistic that stocks will sidestep the new variant worries, but we recommend investors buckle up their seatbelts, as the end of 2021 could be a bumpy one.”

Since the new mutation made its inauspicious debut, the market has recorded more days in the red than otherwise, even though economic data like November ADP private payrolls data continue to defy gravity.

“The mapping from the virus to the lockdown to the macro world has been diminishing,” S&P Global Ratings chief economist Paul Gruenwald told Yahoo Finance Live on Wednesday. “That doesn’t mean we can’t get a shock. Omicron is gonna be a new shock… the good news is the economic impact of COVID seems to be diminishing.”

Still, it can’t be denied that growth remains firmly in an uptrend. And in the spirit of the season, the Morning Brief thinks it’s a worthwhile exercise to point out the myriad ways in which the U.S. economy, despite all odds, is very much firing on all cylinders.

Jobs are more than plentiful. The ADP data showed private sector employment jumped by 534,000 last month, better than most Wall Street estimates, while the employment component of the ISM’s manufacturing gauge showed job creation is still on a tear. That sets the stage for Thursday’s jobless data, which last week set a 52-year trough, and Friday’s all-important jobs report.

Wages are still going up — which means consumers are still willing to spend, spend — and spend some more. COVID-19 has put a damper on consumer sentiment, but that mood isn’t being reflected in high-frequency data. In fact, it’s making people more willing to ring up purchases on credit cards, as Yahoo Finance’s personal finance chief Janna Herron wrote on Wednesday — and a point the Morning Brief also made recently. It also provides us with a reminder that the inflationary pressures we’re experiencing are (for lack of a better phrase) a high-class problem created via a combination of implacable demand from rising pay and pent-up spending from 2020’s COVID-19 lockdowns.

Fourth quarter growth is tracking higher after a Q3 letdown. With consumer spending robust and manufacturing and construction figures also surprising to the upside, ING Chief International Economist James Knightly is expecting a Q4 growth print of at least 6{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a}. “Inflation is likely to record a similar reading, meaning the case for swifter Fed policy tightening is strong. Omicron permitting,” he wrote.

Oil is cratering. Whatever Omicron brings next, one critical element of soaring inflation — energy prices — has suddenly turned disinflationary with crude tumbling nearly $20 from a multiyear high set in October to under $65 per barrel. In fact, you could almost make the case that oil price action suggests crude is getting way oversold, as Yahoo Finance’s Brian Sozzi reported on Wednesday, citing a Goldman Sachs analysis. Yet another high-class problem to have.

By Javier E. David, editor at Yahoo Finance. Follow him at @Teflongeek

Yahoo Finance Highlights

Capital One becomes first big bank to ditch overdraft fees

Elizabeth Holmes’ cross-examination in fraud case is ‘pretty devastating,’ expert says

Jay Leno: Tesla is ‘probably 8-10 years ahead in battery technology’ compared to competitors

Read the latest financial and business news from Yahoo Finance

Follow Yahoo Finance on Twitter, Instagram, YouTube, Facebook, Flipboard, and LinkedIn

November 7, 2021

The growing link between vaccine mandates and open jobs: Morning Brief

This post to start with appeared in the Morning Brief. Get the Morning Quick despatched specifically to your inbox just about every Monday to Friday by 6:30 a.m. ET. Subscribe

Friday, November 5, 2021

How the vaccine mandate could be creating the career crunch worse

With jobless promises hitting a new pandemic-era lower and the Oct careers report on tap for Friday early morning, it is value revisiting a topic the Early morning Brief not too long ago explored.

Specifically, are looming vaccine mandates aiding or hurting a labor crunch which is even now earning firms determined for personnel?

The jury is however really significantly out on what impression requires that workers post to COVID-19 inoculations will have on the labor sector standing quo. Unwittingly, COVID-19 period employment has turn into the nexus in between economics, epidemiology and a society war which is upending norms everywhere you go. According to knowledge from Goldman Sachs, 66{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} in the U.S. have received at minimum a person dose of the vaccine, effectively underneath other significant economies and only over India and Russia.

To summarize, U.S. businesses are obligated to suppress the possibility of an outbreak at their services. Still a sizable contingent of employees keep on being hesitant — if not outright hostile — to the notion of publishing to the jab. The ethics of forcing them to do so in the confront of dropping their livelihood is nonetheless currently being fiercely debated, and is surely good match.

“To the extent that employers in specific industries can carry on employing and permitting employees to operate remotely, firms are doing so, which will allow for more overall flexibility on accommodating staff who could refuse vaccination,” Marc Siegel, founder of Chicago-centered labor legislation company Siegel & Dolan, discussed to the Morning Short in an email.

For much better or even worse, vaccine mandates are scrambling the outlook for the provider sector, specifically in public-dealing with industries like retail and dining establishments wherever proof implies pockets of hesitancy prevail. The public sector has not been immune, with opposition flaring amongst law enforcement officers, firefighters and other to start with responders, which Yahoo Finance’s Dani Romero protected in September.

“Specified employers in the service and retail industries who deal with the public at large, nonetheless, have to look at the challenges of allowing for unvaccinated personnel engage with fellow employees and the normal general public,” Siegel included.

All of this matters, since employee shortages are pushing up wages across industries in a extraordinary way, with companies determined to appeal to and retain talent, which also puts upward force on by now surging inflation.

“The massive story in the labor marketplace is the worsening shortages that are pushing up wage advancement. All the evidence suggests those shortages are worsening many thanks to the imposition of vaccine mandates, with 9,000 New York Town personnel (around 2.5{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} of the complete) getting set on unpaid leave” Michael Pearce, senior U.S. economist at Cash Economics, pointed out not too long ago.

To the extent that opportunity or present staff members are reluctant to meet the primary necessity of a posture — particularly that they be vaccinated — careers will continue being unfilled in the facial area of soaring demand.

By requiring vaccinations, “employers are possibly restricting their pool of applicants. Likewise, by refusing to get vaccinated, personnel who do not meet up with criteria for employment are restricting their possible career possibilities,” according to Siegel.

On the other hand, “demanding proof of [COVID-19] vaccination is not a lot different than other lawful prerequisites that businesses by now make,” he included.

In a convoluted way, the standoff in between the vaccine hesitant and authorities/private sector robust-arming them into taking the shot may be taking part in a position in prolonging equally the labor crunch and soaring value pressures (some economists could possibly get in touch with that a destructive externality).

So what’s the respond to to an more and more nettlesome quandary?

In a fascinating New York Periods short article, Tyson Food items shed some light on the sensitive balancing act that companies have been compelled to wander in demanding vaccines for personnel, primarily with President Joe Biden location a Jan. 4 deadline to mandate the shot, or put into practice a weekly testing routine, as Yahoo Finance’s Alexis Keenan described on Thursday.

“We produced the decision to do the mandate, fully knowing that we were putting our small business at possibility,” Tyson CEO Donnie King, explained to The Times’ Lauren Hirsch (my previous colleague) in an interview. “This was pretty unpleasant to do,” he additional.

And The Times’ reporting yielded this intriguing nugget: The meals big, which was hit hard by COVID-19 bacterial infections that pressured it to temporarily shut down operations, now offers a 96{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} vaccine uptake among personnel. As unpopular and polarizing as mandates might be, they are plainly effective on some degree.

Jobless facts suggests that COVID-19 shot needs haven’t pushed workers out of the labor drive en masse, while it truly is very significantly an open up problem no matter whether workers who voluntarily quit dependent on their refusal to get a shot are qualified for unemployment.

That stated, tightening vaccination needs may extremely properly be taking part in a role in preserving a host of positions open up. October’s nonfarm payrolls is possible to inform the tale of an overall economy that simply cannot create new work right until they fill their current vacancies.

By Javier E. David, editor at Yahoo Finance. Abide by him at @Teflongeek

Yahoo Finance Highlights

Costco is dominating ahead of the vacation year

Powell commits to making sure investing scandal never happens once more at Federal Reserve

McDonald’s McRib NFTs gasoline social media mentions, new info exhibit

—

Follow Yahoo Finance on Twitter, Fb, Instagram, Flipboard, LinkedIn, YouTube, and reddit