What Moved The Markets This Week 📈
U.S. GDP Growth Accelerates To 3.3%, PCE Inflation Cools To 2.6%, Microsoft Gaming Layoffs, China Considers Major Stock Bailout, Apple Overhauls App Store Rules In EU, and TSLA + NFLX + V Earnings
Sunday Morning Markets
Trading Week 4, covering Monday, Jan 22 through Friday, Jan 26. Your weekly financial markets update, in less than 5 minutes.
The Week In Review ⏪
GDP grew a staggering 3.3% in Q4
Core PCE inflation cools off to 2.6%
Layoffs from Microsoft, HubSpot, eBay, and more
S&P Composite PMI jumps up to 52.3%
ECB, BOJ, BOC all leave rates unchanged
China considering $280B stock bailout
Sweden’s NATO bid approved by Turkey
Apple overhauls App Store rules in Europe
PayPal launches lineup of new features
Earnings from Tesla, Netflix, and Visa
US Markets 🇺🇸
Fed's preferred inflation gauge falls below 3% for first time since March 2021. The PCE index grew 2.6% year-over-year in December. Core-PCE grew 2.9%, down from the previous reading of 3.2% and below the 3.0% estimate.
The U.S. economy grew at a blistering 3.3% pace in Q4, well ahead of the 2% estimate. Growth was led by a 3.3% increase in government spending and a 2.8% increase in consumer expenditures.
S&P sees business activity picking up in January as their Composite PMI increased to 52.3 this month, the highest level since last June and up from December’s reading of 50.9.
Sales of new homes surged 8% in December as a drop in mortgage rates enticed prospective buyers. The median sales price of new single-family homes dropped for the fourth straight month to $413,200.
Microsoft lays off 1900 workers from its gaming division after acquiring Activision. Other layoffs were announced by SAP (7%), HubSpot (7%), eBay (9%), Levi Strauss (10%), and Polestar (15%).
Sunoco to buy NuStar Energy in $7.3 billion all-stock deal and expects the deal to close in Q2’24. NuStar’s investors will receive 0.4 shares of Sunoco for each NuStar share they own, implying a 31.9% purchase premium.
Amer Sports targets up to $8.7 billion valuation in IPO and aims to raise $1.8 billion in cash. Amer Sports owns the popular Wilson sporting brand, as well as Salomon, Atomic, and Arc’teryx.
Global Markets 🌏
Bank of Japan retains its ultra-loose monetary policy and says its 2% inflation target is in sight. The central bank unanimously decided to keep interest rates at -0.1% but the market expects it to abolish the negative rate regime by April.
European Central Bank holds rates steady and gives no hint at cuts ahead despite making significant progress on inflation. Markets are currently pricing a total of roughly 1.5% for the year, with the first cut starting in April.
Apple overhauls its iOS and App Store rules in Europe in response to EU anti-trust backlash. The revamp will allow customers to download apps from 3rd party app stores, as well as use alternative payment systems and web browsers.
Apple takes top spot in China’s smartphone market for the first time as their market share grows to 17.3%. Huawei made a shocking return to the top five as their new phone, the Mate 60, helped grow shipments 36% this year.
China is weighing measures to prop up its stock markets including a 2 trillion yuan (~$278 billion) rescue package backed by offshore money from its Chinese state-owned companies. The Hang Seng Index rose 7% this week.
Alibaba cofounders buy $200 million worth of shares according to a regulatory filing. The company’s shares have struggled since canceling the planned spinoff of its cloud business. BABA 0.00%↑ shares rose 10% this week.
Putin signals interest in discussing end to war according to a Bloomberg report. However, top U.S. officials say they’re not aware of the supposed overtures and see no indication that Putin wants to end the war.
Turkey approves Sweden’s NATO membership bid, bringing the previously nonaligned Nordic country a step closer to joining the military alliance. Hungary now remains the only ally not to have ratified Sweden’s accession
Tech ⚡
PayPal launches a series of new features that its new CEO hopes can spur growth, including “Fastlane” for one-click guest checkouts, “CashPass” for cash-back offers, and AI-powered “Smart Receipts” for email upsells.
Netflix to stream WWE’s Raw starting next year; its biggest jump into live entertainment yet as the company aims to push viewers into its ad-tier membership. The 10-year deal is valued at more than $5 billion.
Apple sold roughly 160-180K Vision Pro headsets in its opening weekend, according to TF Securities. That's 40% of the 400K units Apple expects to sell this year, but according to analysts, the real test will come in the weeks ahead.
Apple pushes back self-driving car plans to 2028 and scales down capabilities to Level 2+ autonomy. The Apple Car program started in 2014 and has seen several new bosses, changes in strategies, and numerous delays.
BNPL firm, Klarna, to launch $7.99 monthly plan to help lock in its heaviest users ahead of its IPO. Users with ‘Klarna Plus’ will get service fees waived, earn 2x rewards points, and have access to exclusive discounts from retailers.
Terraform Labs files for Chapter 11 bankruptcy following the collapse of its TerraUSD and Luna tokens in 2022. However, the company still plans to expand its ongoing web3 business and recently launched its Station v3 wallet.
Earnings Reports 💰
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Weekly Poll 🗳️
SMM Product Hunt 🧠
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Week Ahead 📅
Monday
AU - Retail Sales (DEC)🇦🇺
Earnings Reports: Super Micro Computer, SoFi💰
Tuesday
US - JOLTs Job Openings (DEC)🇺🇸
US - CB Consumer Confidence (JAN)🇺🇸
EU - GDP (Q4)🇪🇺
CN - Manufacturing PMI (JAN)🇨🇳
Earnings Reports: Microsoft, Alphabet, AMD, Pfizer, UPS, Starbucks, GM, JetBlue, Match💰
Wednesday
US - Fed Interest Rate Decision 🇺🇸
US - ADP Employment (JAN) 🇺🇸
US - Chicago PMI (JAN) 🇺🇸
DE - CPI Inflation (JAN)🇩🇪
DE - GDP (Q4)🇩🇪
CN - Caixin Manufacturing PMI (JAN)🇨🇳
Earnings Reports: Novo Nordisk, Mastercard, Alibaba, Boeing💰
Thursday
US - ISM Manufacturing PMI (JAN)🇺🇸
US - S&P Manufacturing PMI (JAN)🇺🇸
UK - BoE Interest Rate (JAN)🇬🇧
EU - CPI Inflation (JAN)🇪🇺
Earnings Reports: Apple, Amazon, Meta, Merck, Atlassian, Ferrari, Pinterest, Peloton💰
Friday
US - Nonfarm Payrolls (JAN)🇺🇸
US - Unemployment Rate (JAN)🇺🇸
Earnings Reports: Exxon Mobil, AbbVie, Chevron💰
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