text stringlengths 237 126k | date_download stringdate 2022-01-01 00:32:20 2023-01-01 00:02:37 β | source_domain stringclasses 60 values | title stringlengths 4 31.5k β | url stringlengths 24 617 β | id stringlengths 24 617 β |
|---|---|---|---|---|---|
Costco (COST) reported a solid fiscal fourth quarter after the closing bell Thursday. Total revenue, which includes revenues from membership fees, increased 15% year over year to $72.09 billion, a slight beat compared to the consensus estimate of $72.04 billion. Earnings per share grew nearly 12% year over year to $4.20, beating estimates of $4.17. Over the full 16-week period, comparable sales in the United States increased 15.8% or 9.6% on an adjusted basis, which excludes the impact of gasoline prices and foreign exchange. In Canada, comparable sales increased 13.4% or 13.7% on an adjusted basis, while for the rest of international, comps increased 2.9% or 11.3% on an adjusted basis. E-commerce comparable sales increased 7.1% or 8.4% on an adjusted basis. For the total company, comparable sales increased 7.1% or 8.4% on an adjusted basis. Bottom line Costco shares were trading lower after-hours in reaction to the slight quarterly beats, but that's typical of how Costco trades when it reports earnings. Costco doesn't provide guidance but it does report its comparable sales on a monthly basis, Due to that monthly sales reporting structure, a lot of the good news gets priced-in ahead of the quarter. We continue to view Costco as a consistent, high-quality retailer with a fantastic business model that helps them to succeed in any economic environment. Inflationary, expansionary, or a recession, shoppers will always seek out the quality products at value prices Costco offers its customers. The stock may not be cheap by any measure, but we believe the premium is justified because of its dependable earnings growth. We continue to believe weakness in shares represents a long-term buying opportunity. Membership stats Revenue from membership fees is a closely followed metric because it is subscription based and is where Costco earns the majority of its profits. Membership fees increased 7.5% year over year to $1.33 billion, in-line with estimates of $1.321 billion. Foreign exchange had a $29.8 million negative impact. Costco ended its quarter with 118.9 million cardholders, an increase from 116.6 million total cardholders last quarter. Paid executive members ended the quarter at 29.1 million, up from 27.9 million last quarter. Renewal rates in the U.S. and Canada were 92.6%, a new all-time high. That's up 0.3% from last quarter. The worldwide renewal rate was 90.4, up 0.4% from last quarter. Margins Merchandise gross margins on a reported basis were 10.18% and down 74 basis points from last year, but excluding the impact of gas inflation it would have been lower by only 20 basis points. Core merchandise margins fell 67 basis points on a reported basis and were down 23 basis points ex gas inflation. Sales mix was the primary driver of the decline because the wholesaler sold a lot of gasoline in the quarter, as you would expect, and that's a lower margin product. Ancillary and other businesses' margins increased 20 basis points on a reported basis and 34 basis points excluding gas inflation. Elsewhere, "2% reward" reported margins were flat on a reported basis and fell 5 basis points ex gas inflation. LIFO β last in, first out β margins fell 27 basis points on a reported basis and 29 basis points excluding gas. Other items The best-performing core categories in the fiscal fourth quarter were candy, frozen, kiosks, tire, lawn and garden, jewelry, toys, bakery, and deli. Costco opened up nine new net warehouses in the quarter, bringing the total for the full fiscal year to 26. Costco expects to open 29 new warehouses in fiscal 2023. The company estimated price inflation in the quarter was about 8%. That's up from about 7% in the prior quarter. It's a mixed picture, though, as Costco cited higher price inflation on food and sundries but a little lower on fresh foods. Wages are still higher. Costco is seeing commodities prices come down in areas such as gas, steel, beef, small changes in plastics, and also container pricing versus last year. The company hasn't seen any discernable trend in its customers trading down. Potential catalysts As expected after Jim Cramer's interview with CEO Craig Jelinek last week, management shot down the notion that an increase to its membership fee plan was imminent. Recall, that Costco historically has increased its membership fee every 5 to 5Β½ years. The 5Β½-year anniversary will be about January 2023, so let's put this conversation on hold for at least a few more months. That being said, we believe Costco has the pricing power to increase its membership fees based on its customer loyalty and historically high renewal numbers. There was no talk about capital allocation and the cash on the balance sheet. We bring this up because Costco has paid out a special dividend four times in the past eight years, the last being in November 2020. (Jim Cramer's Charitable Trust is long COST. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
Shopping carts are lined up in front of a Costco store on February 25, 2021 in Inglewood, California. | 2022-09-23T02:50:45Z | www.cnbc.com | Costco's quarterly results indicate the retailer is thriving despite high inflation | https://www.cnbc.com/2022/09/22/costcos-quarterly-results-indicate-the-retailer-is-thriving-despite-high-inflation.html | https://www.cnbc.com/2022/09/22/costcos-quarterly-results-indicate-the-retailer-is-thriving-despite-high-inflation.html |
The Federal Reserve's signal that it may risk a recession in its inflation fight prompted Evercore ISI to slash its market forecast Thursday. The Wall Street firm cut its year-end S & P 500 target to 3,975 from 4,200. The new target is still about 5% higher than Wednesday's close of 3,789.93 but would represent a 16% decline for 2022. "Stocks' reaction to the FOMC reflects that a rising probability of recession requires further discounting," Evercore's Julian Emanuel said in a note to clients. "Chair Powell, to the market's obvious dismay, outdid Jackson Hole's abject, 'drop the mic' hawkishness on Wednesday. Hard to believe, but he did." The central bank's Federal Open Market Committee on Wednesday raised benchmark interest rates by another three-quarters of a percentage point to a range of 3%-3.25%, the highest since early 2008. The Fed also signaled that it will raise rates as high as 4.6% in 2023 before ending its inflation battle. The central bank believes that aggressive rate hikes are poised to slow down the economy. The Summary of Economic Projections from the Fed showed the unemployment rate is estimated to rise to 4.4% by next year from its current 3.7%. Meanwhile, GDP growth is forecast to slump to just 0.2% for 2022. "The Fed's projection of unemployment in 2023 is 4.4%, up from July's 3.5%. Such a rise in unemployment has a near unblemished record of leading to a recession in short order," Emanuel said. β CNBC's Michael Bloom contributed to this report. | 2022-09-23T02:51:40Z | www.cnbc.com | Evercore ISI cuts S&P 500 year-end target as Fed signals risk of recession | https://www.cnbc.com/2022/09/22/evercore-isi-cuts-sp-500-year-end-target-as-feds-tough-talk-raises-probability-of-a-recession.html | https://www.cnbc.com/2022/09/22/evercore-isi-cuts-sp-500-year-end-target-as-feds-tough-talk-raises-probability-of-a-recession.html |
Because your tax return from two years earlier is used to determine whether you are subject to income-related adjustment amounts, new retirees may need to appeal those charges if your retirement income is lower than that.
That is, you may need to appeal so-called income-related adjustment amounts, or IRMAAs, if your income as a new retiree is lower than when you were working. Those extra charges kick in for higher-income Medicare beneficiaries and are in addition to what they pay in monthly premiums for Part B outpatient care coverage and Part D prescription drug coverage. (Part A, which covers inpatient care, typically comes with no premium.)
For Part D, the surcharges for 2022 range from $12.40 to $77.90. That's in addition to any premium you pay, whether through a stand-alone prescription drug plan or through a Medicare Advantage Plan, which typically includes Part D coverage. Those premiums can vary among plans. | 2022-09-23T02:52:41Z | www.cnbc.com | How to appeal Medicare premium IRMAA surcharges | https://www.cnbc.com/2022/09/22/how-to-appeal-medicare-premium-irmaa-surcharges.html | https://www.cnbc.com/2022/09/22/how-to-appeal-medicare-premium-irmaa-surcharges.html |
Hurricane Fiona caused severe damage to Puerto Rico earlier this week, leaving hundreds of thousands without access to electricity or running water.
View of a sailboat dragged to the shore by strong waves in the Bay of Samana, after the passage of Hurricane Fiona, in Samana, Dominican Republic on September 20, 2022.
Biden made the announcement at the Federal Emergency Management Agency's Region 2 headquarters at One World Trade Center in New York City.
The president on Wednesday approved a major disaster declaration for Puerto Rico. That followed an emergency declaration he approved Sunday before the hurricane made landfall, and allows FEMA to give direct payments to those affected for temporary housing and home repairs. Under the declaration, FEMA can also offer low-cost loans.
"We're laser-focused on what's happened to people in Puerto Rico again. We're talking almost to the day, at least to the week, five years after Hurricane Maria was devastating [the island]," Biden said. "We're surging federal resources to Puerto Rico and we'll do everything, everything we can to reach the urgent needs they have."
Providing aid to Puerto Rico was one of Biden's campaign pledges. He had said former President Donald Trump "made things worse" for the island with his response to Hurricane Maria in 2017. | 2022-09-23T02:52:53Z | www.cnbc.com | Hurricane Fiona: Biden promises federal funding for Puerto Rico aid | https://www.cnbc.com/2022/09/22/hurricane-fiona-biden-promises-federal-funding-for-puerto-rico-aid.html | https://www.cnbc.com/2022/09/22/hurricane-fiona-biden-promises-federal-funding-for-puerto-rico-aid.html |
A look at the Black Sea Grain Initiative, the UN-backed deal that helped reopen Ukraine's ports to feed countries around the world
UNITED NATIONS β As world leaders gather for the third day of high-level meetings at U.N. headquarters in New York City, seven vessels carrying precious crops quietly departed Ukrainian ports.
The ships sail by way of the Black Sea Grain Initiative, a United Nations-backed deal aimed at easing Russia's naval blockade and reopening three key Ukrainian ports. Representatives from Ukraine, Russia, the U.N. and Turkey held negotiations to create the sea corridor in Istanbul earlier this year and signed the landmark deal on July 27. | 2022-09-23T02:52:59Z | www.cnbc.com | Infographic showing Black Sea Initiative | https://www.cnbc.com/2022/09/22/infographic-showing-black-sea-initiative-crops.html | https://www.cnbc.com/2022/09/22/infographic-showing-black-sea-initiative-crops.html |
Shares of Club holding Meta Platforms (META) are looking more attractive after a report on Thursday that the social media giant is planning to slash costs. The parent of Facebook is looking to reduce expenses by at least 10% in the coming months, according to a Tuesday report in The Wall Street Journal, citing people familiar with the company's plans. Morgan Stanley applauded the move, stating that it could result in stronger profits. The firm has a buy rating on META, with a price target of $225. We couldn't agree more. "I think Meta is a buy," Jim Cramer said in the Investing Club's 'Morning Meeting' on Thursday . "It sells at 11 times earnings, they're going for profitable growth β¦ the actual metaverse, people want to be in it. I would encourage people to start buying it if they don't own it," he explained. Shares of META hit a 52-week low on Thursday and have lost more than half of their value for the year as many tech names have fallen out of favor with investors. But we remain optimistic about the company's long-term growth prospects. The news A reduction in headcount is a "prelude to deeper cuts," as Meta looks to cut costs by at least 10% in the coming months, according to the The Journal exclusive. This is consistent with comments Meta CEO Mark Zuckerberg made during the company's second-quarter earnings call that headcount β which had increased 32% from a year earlier to 83,553 β would come down to cut costs. "Our plan is to steadily reduce headcount growth over the next year," Zuckerberg said. "Many teams are going to shrink so we can shift energy to other areas. I expect us to get more done with fewer resources." Meta reported lower-than-expected revenue of $28.2 billion in the second quarter, slightly missing the $28.9 billion expected by the Street and a 1% drop from the prior year. The tech giant also issued a discouraging forecast for its current third quarter, expecting total revenue to come in at $26 billion to $28.5 billion, citing continued weak advertising demand. Wall Street sees Meta's planned employee cuts as setting it up for better margins down the line: Analysts are Morgan Stanley estimate that cost cutting through staff reductions could lead to $3 billion to $8 billion in OpEx (operational expenditure) savings. 2023 GAAP EPS would increase about 10% under this scenario, to $10.85 from $9.90. Tech layoffs are a growing trend this year after the sector went on a hiring spree to keep up with demand during the pandemic. That hiring binge has now led to hiring freezes and staff cuts, part of an effort to manage costs during this period of high inflation. Bottom line It's good news to see Meta slash expenses, said Jeff Marks, director of portfolio analysis at the Investing Club. The company's cost cuts will help its earnings per share find a floor during this period of sluggish growth which is being driven by a number of different factors like competition, the broader economy, and ad targeting headwinds, he added. While growth is slowing on Instagram and Facebook, WhatsApp could be the big platform the company monetizes next. Meta announced a strategic partnership with Salesforce on Tuesday that includes integrating WhatsApp with Salesforce's customer 360 applications to offer business messaging services. Last month, Meta launched its first end-to-end shopping experience on WhatsApp with Indian e-commerce company Jiomart. It allows people to buy groceries in a chat, potentially reshaping the way Indian citizens and businesses interact. (Jim Cramer's Charitable Trust is long META. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
The logo of Meta Platforms is seen in Davos, Switzerland, May 22, 2022. | 2022-09-23T02:53:33Z | www.cnbc.com | Meta is a buy as the social media giant embarks on plan to slash costs | https://www.cnbc.com/2022/09/22/meta-is-a-buy-as-the-social-media-giant-embarks-on-plan-to-slash-costs.html | https://www.cnbc.com/2022/09/22/meta-is-a-buy-as-the-social-media-giant-embarks-on-plan-to-slash-costs.html |
'Boring is beautiful': Morgan Stanley's Mike Wilson says play it safe with stocks
It's been a difficult year for stock markets. A massive sell-off in the first half that ranked among the worst in 50 years and bleak outlooks from some of the biggest U.S. companies have weighed heavily on market sentiment, with major U.S. indexes in the red this year. "We have been pretty consistently defensive all year on our general thesis that the Federal Reserve is going to be hiking aggressively and that growth was going to disappoint. It has worked out quite well," Morgan Stanley 's chief U.S. equity strategist told CNBC's " Squawk Box Asia " on Wednesday. "I know it's boring, but sometimes boring is beautiful. It has worked out really well so far," he said. Wilson isn't the only investment pro who's favoring a defensive stance. A slew of investment banks on Wall Street are urging investors to remain calm this week amid the market turmoil and invest in companies with defensive characteristics. There have been several false dawns in this year's bear market, including a summer rally that saw a resurgence in technology stocks β one of the most beaten down sectors in the first half's market rout. But Wilson is not convinced. "There has been a couple of bear market rallies where people have gone back to some of the more cyclical parts in the market, or they have chased some of the big tech names again, but we think that's been a mistake," he said. He added that cyclical parts of the market, such as tech, continue to look "vulnerable" to him. Most important quality How should investors position themselves against such a backdrop? Wilson said companies with operational efficiency are likely to do well in the current environment. He added that the market has been rewarding companies that can efficiently deliver profits, even if their revenues aren't "necessarily growing the fastest." "Pricing power is one of those factors that will help operational efficiency but what it really comes down to is companies that are managing costs better," he said. The bank takes into account three types of costs: labor costs, inventory costs and capital expenditure. Read more Does FedEx's bleak outlook flash a warning signal for investors? Here's what the pros say Fund manager says the bear market is going to get 'nasty' β but says he's not 'freaking out' Want to play the EV sector? Here's one lithium stock that analysts say could soar 70% Wilson noted that companies with "modest" spending in these areas have been "rewarded" this year. He added that the trend is likely to persist until the market "decides it wants to be more offensive." "That's our strategy and it has been working well. We don't want to get too complacent or, you know, too dogmatic here, but we just don't think it's time to flip into the more aggressive parts of the market yet or the aggressive names that have high operating leverage," he added. | 2022-09-23T02:53:45Z | www.cnbc.com | Morgan Stanley's Mike Wilson is staying defensive in stocks | https://www.cnbc.com/2022/09/22/morgan-stanleys-mike-wilson-is-staying-defensive-in-stocks-.html | https://www.cnbc.com/2022/09/22/morgan-stanleys-mike-wilson-is-staying-defensive-in-stocks-.html |
Hawkish comments from Federal Reserve officials and a hotter-than-expected August inflation report have weighed on stock markets in recent weeks as investors grapple with the prospect of higher-for-longer rate hikes even as recession concerns mount. The Fed announced a third consecutive 75 basis point hike on Wednesday that took its federal funds rate up to a range of 3%-3.25%, the highest it has been since early 2008. Projections from the meeting indicated that the Fed expects to raise rates by at least 1.25 percentage points in its two remaining meetings this year. Speaking ahead of the Fed meeting, investment veteran Patrick Armstrong believes the Fed is unlikely to keep hiking rates indefinitely. "I think consensus probably has the Fed getting to 4.25% in March next year, and then probably pausing. It will be driven by the U.S. economy as much as the inflation outlook. I think the U.S. is going to be on the cusp of a recession throughout early 2023 so it's hard for me to see the Fed hiking aggressively once they realize the U.S. is pretty much in a recession or very close to a recession," Armstrong, who is chief investment officer at Plurimi Wealth, told CNBC's "Squawk Box Europe" on Monday. Armstrong is co-fund manager of the Prosper Global Macro fund , a diversified multi-asset fund with an inflation beating mandate. The fund was up 4.8% as of the end of August, outperforming major indexes in both the U.S. and Europe. The S & P 500 and the Stoxx 600 are down about 20% and 15%, respectively, in the same period. What's in his portfolio Amid the uncertainty in stock markets, he believes the biggest risk is the earnings outlook, which remains "way too optimistic." "We have not seen any significant negative revisions despite overwhelming evidence of a really poor economic backdrop where consumer spending is really going to be impeded. Margins are going to be squeezed and so are earnings per share," he said. Against this backdrop, the Prosper Global Macro fund has taken on several short positions, as Armstrong bets that the values of these holdings will decline amid the market volatility. The biggest short holding in the fund is a 20% bet against 10-year Japanese government bonds. "The Bank of Japan owns half of all bonds that are outstanding. They're desperately trying to cap their interest rates at 0.25% when other central banks are aggressively hiking β¦ with a 40-year low yet you're going to be importing inflation. I just don't see any realistic scenario where the BOJ can keep this 0% 10-year in place. So, I think that's an incredible short right now," he said. Armstrong was referring to the Bank of Japan's yield curve control (YCC) policy β a strategy that caps 10-year JGBs around 0% and offers to buy unlimited amount of JGBs to defend an implicit 0.25% cap around the target. Read more Fund manager says the bear market is going to get 'nasty' β but says he's not 'freaking out' Looking for a short-term trade? This ETF carries risk β but outperforms when volatility spikes The Japanese yen is at 24-year lows. Here's what to expect at the next BOJ meeting The fund also holds shorts in several tech and consumer stocks, such as food delivery service DoorDash , Chinese electric vehicle maker Xpeng , British online supermarket Ocado and plant-based meat substitute firm Beyond Meat . Armstrong also sees "significant downside" for commercial property stocks in the U.K. and retail property stocks in the U.S, where his fund is short British Land and Simon Property , respectively. He said it is a "pretty toxic environment" for commercial properties in the U.K. with the economy in "pretty terrible" shape, while the prospect of further interest rate hikes by the Bank of England will weigh on land value. The same challenges afflict the U.S. retail scene, in addition to an increasing trend of consumers shopping online, he added. β CNBC's Jeff Cox contributed to the report | 2022-09-23T02:54:10Z | www.cnbc.com | Outperforming fund manager reveals short positions | https://www.cnbc.com/2022/09/22/outperforming-multi-asset-fund-manager-reveals-short-positions-.html | https://www.cnbc.com/2022/09/22/outperforming-multi-asset-fund-manager-reveals-short-positions-.html |
Club holding Costco (COST) is set to report a surge in fiscal fourth-quarter earnings after the closing bell on Thursday, despite a barrage of macroeconomic headwinds. The retail sector has been weighed down this year by stubbornly high inflation, which has eaten away at profit margins and increased labor and input costs. But Costco has proved resilient β and we've long held it is the best-run retailer in the world. Costco's earnings-per-share are expected to be $4.17 on revenue of $72.04 billion, according to estimates from Refinitiv. That compares with EPS of $3.90 and revenue of $62.7 billion during the same period a year prior. Competitive advantage Part of Costco's DNA is to provide value to its customers through its competitively priced, broad-based merchandise. The wholesale retailer accomplishes this through a high-volume, low-cost business model, allowing it to price goods even cheaper than competitors like Walmart (WMT) and Target (TGT). We believe this member-focused wholesale subscription business can keep driving Costco's top-line growth in a tough economy. This strategy has already proved Costco can deliver on earnings, which is why we're expecting solid results in its fiscal Q4. In its fiscal third quarter earnings , released May 26, Costco's total revenue increased 16% year-over-year, to $52.6 billion. Included in that number, revenue from membership fees came in at $984 million, up 9.2% year-over-year. Costco ended its third quarter with 116.6 million total cardholders, an increase from 114.8 million total cardholders the prior quarter. Renewal rates in the U.S. and Canada hit an all-time high of 92.3%, while the worldwide rate came in at 90% for the first time in Costco's history. Historically, Costco has raised membership fees every five to six years, with the last increase in June 2017. But given the difficult macro environment, the retailer has decided to hold off. We think this decision shows the company is in a strong position, signaling it doesn't need immediate relief from inflation. On the other hand, Walmart-owned Sam's Club announced last month an increase in its annual membership fees come October. Wall Street also recognizes Costco's competitive advantages. Bank of America, which reaffirmed its buy rating earlier this week, said Costco is well positioned in the current environment, citing the company's healthy consumer traffic growth, strong membership renewal rates, and a growing international division. BofA sees a premium valuation for the retailer, assigning a price objective of $605. That's 22% higher than Wednesday's close. And for good reason. Costco has been able to effectively navigate high inflation by staying true to its business model. The company's goal is to partner with vendors to mitigate price increases, helped by Costco's high-volume business with its suppliers. Above all, Costco CEO Craig Jelinek thinks of the retailer as the "price police," he said in an interview with Jim Cramer last week . More broadly, Jelinek thinks commodity inflation has been slowing and overall inflation has peaked. "I think you're going to see maybe another six-months-to-a year, things will start to come down. If you start to see now, fuel prices are coming down, which is a big part of distribution costs," he said. Despite the continued economic uncertainty for consumers, one area where Costco customers have been finding real bargains is gasoline, which was one of the company's biggest revenue centers in its third quarter as U.S. gas prices reached historic average highs this past summer above $5 per gallon. "The industry demand in gallons for gas is in the 1%-2% range and what I can tell you is we are much better than that in the high teens and low 20s in terms of where we've been trending," Jelinek said during the company's third quarter earnings conference call. Bottom line Unlike most public companies, Costco announces sales figures every month, in addition to its regularly scheduled quarterly reports. Those monthly numbers have been coming in strong. For this reason, we'll be paying special attention in the current inflationary environment to areas of the business with less visibility such as margins and earnings performance. We do not believe a membership fee price increase is imminent. But based on what the CEO recently told Jim, Costco has the pricing power to do so when it believes the timing is right, according Jeff Marks, director of portfolio analysis at the Club. "With a balance sheet flush with cash, we'll look for management's thoughts on how they are approaching capital allocation," Marks said. Costco shares have an annual dividend yield of 0.74%. "In any event, we view Costco as a consistent, high-quality retailer with a fantastic business model that allows them to succeed in any economic environment," he added. (Jim Cramer's Charitable Trust is long COST. See here for a full list of the stocks.) β Correction: This story has been updated to reflect that shares of Costco have an annual dividend yield of 0.74%. An earlier version misstated the number. As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
A consumer shops in a Costco store in Miami on Sept. 28, 2021. | 2022-09-23T02:56:43Z | www.cnbc.com | What to expect when Costco reports earnings after the closing bell Thursday | https://www.cnbc.com/2022/09/22/what-to-expect-when-costco-reports-earnings-after-the-closing-bell-thursday.html | https://www.cnbc.com/2022/09/22/what-to-expect-when-costco-reports-earnings-after-the-closing-bell-thursday.html |
For signs that inflation may be easing, Wall Street pros have an unlikely source β the price of used cars. The Manheim Used Car Price Index fell to 205.9 in September from 210.8 in August. Since the beginning of the year, the index has declined nearly 13%. The consumer price index paints a similar picture β in August, used car and truck prices fell 0.1% from the previous month, according to the Bureau of Labor Statistics. This index is often regarded as the "canary in the coal mine" for inflation as car sales, and particularly used cars, touch many parts of the economy, including gas prices, consumer confidence, supply chain issues, interest rates and more. Cox Automotive publishes the index, which tracks the prices of used vehicles sold at its U.S. wholesale auctions. The surge in prices of used cars was a meaningful part of the runup in inflation to the 40-year high, analysts at Deutsche Bank said in a Sept. 15 note. In 2020 and 2021, as the pandemic raged and inflation began to climb, used car prices increased by 20% each year. "For the ten years ending 2019, (pre-pandemic), used car prices appreciated at a 2% annual rate β consistent with overall inflation," said Kevin Barry, chief investment officer of Summit Financial in Parsippany, New Jersey, in a note. "For the two years ending 2021, the pace of increase was 10X the previous ten years." Predicting the end of rate hikes Going forward, measuring cooling inflation is important as it may give some insight into when the Federal Reserve will stop hiking interest rates and even start cutting them. On Wednesday, the central bank delivered its third consecutive 0.75 percentage point interest rate increase to tame inflation, and raised its terminal rate to 4.6% in 2023, signaling there's at least one more 0.75 percentage point rate hike coming this year. The used vehicle value index shows that while used car prices are trending in the right direction, there's still room to go before the Fed is confident that inflation is back in check, according to Barry. To bring the index back to its pre-pandemic trend of a 2% annual price increase, it would have to drop more than 25%. A drop of about 20%, however, would bring the annual price increase trend to about 5%, which is likely where the Fed will feel comfortable ending their hiking campaign. "I believe that the Fed will increase interest rates until the index drops to 163, from 205 today," he said. That's a roughly 20% drop. | 2022-09-23T02:57:32Z | www.cnbc.com | This index is signaling that inflation already peaked and is slowing | https://www.cnbc.com/2022/09/23/this-index-is-signaling-that-inflation-already-peaked-and-is-slowing.html | https://www.cnbc.com/2022/09/23/this-index-is-signaling-that-inflation-already-peaked-and-is-slowing.html |
Putin's 'incredibly dangerous' nuclear threats raise the risk of an unprecedented disaster
Putinβs threats increase the risk of escalation to a nuclear conflict drastically. This is incredibly dangerous and irresponsible.
Beatrice Fihn
ICAN executive director
Beatrice Fihn, Nobel laureate and executive director of the International Campaign Against Nuclear Weapons, urged political leaders to renew efforts to get rid of all nuclear weapons by signing and ratifying the Treaty on the Prohibition of Nuclear Weapons. | 2022-09-23T09:09:22Z | www.cnbc.com | Russia-Ukraine war: Putin's nuclear threats raise the risk of disaster | https://www.cnbc.com/2022/09/23/russia-ukraine-war-putins-nuclear-threats-raise-the-risk-of-disaster.html | https://www.cnbc.com/2022/09/23/russia-ukraine-war-putins-nuclear-threats-raise-the-risk-of-disaster.html |
They have really been searching for inflation and the causes of inflation in all the wrong places. They're looking at everything under the sun, but the money supply.
Professor of applied economics, Johns Hopkins University.
A customer shops at a supermarket in Oregon. There's an 80% chance of the U.S. falling into a recession β much higher than previously predicted, according to Steve Hanke, a professor of applied economics at Johns Hopkins University. | 2022-09-23T09:09:28Z | www.cnbc.com | There is an 80% chance of the U.S. going into a recession: Steve Hanke | https://www.cnbc.com/2022/09/23/there-is-an-80percent-chance-of-the-us-going-into-a-recession-steve-hanke.html | https://www.cnbc.com/2022/09/23/there-is-an-80percent-chance-of-the-us-going-into-a-recession-steve-hanke.html |
The U.K. will cancel a planned rise in corporation tax
Finance minister Kwasi Kwarteng confirmed previously-leaked plans to cancel a planned rise in corporation tax to 25%, keeping it at 19%, the lowest rate in the G20; to reverse a recent 1.25% rise in National Insurance; and to cut a tax on home purchases.
He also outlined plans for a network of "investment zones" around the country that will have lower taxation rates for businesses and reduced regulations, as well as a new bill to unpack planning restrictions and EU laws. He announced a list of infrastructure projects across transport, energy and telecoms. Tourists will now get VAT free shopping, an increase in rates on alcohol will be cancelled, and the cap on bankers' bonuses will be scrapped, he added.
Speaking to the House of Commons, Kwarteng said the government wanted a "new approach for a new era focused on growth" and was targeting a medium-term trend rate of growth of 2.5%.
He said the government wanted to expand the supply side of the economy through tax incentives and reform to deliver higher wages, greater opportunities, fund public services and "compete with dynamic economies around the world."
It comes a day after the Bank of England said the U.K. economy was likely to have entered an official recession in the third quarter, as it hiked interest rates by 50 basis points to combat decades-high inflation.
Despite containing extensive reforms, the package is not being described by the government as an official budget as it has not been accompanied by the usual economic forecasts from the Office for Budget Responsibility.
The Institute for Fiscal Studies, an economic research group, said the reversal in the income tax rise and canceling the planned rise in corporation tax would lead to a Β£30 billion reduction in taxation revenue. It added that "setting plans underpinned by the idea that headline tax cuts will deliver a sustained boost to growth is a gamble, at best."
Groups including the opposition Labour party argue that the tax cuts will disproportionately benefit the wealthy. | 2022-09-23T09:09:34Z | www.cnbc.com | UK government dishes out tax cuts as country braces for recession | https://www.cnbc.com/2022/09/23/uk-government-dishes-out-tax-cuts-as-country-braces-for-recession.html | https://www.cnbc.com/2022/09/23/uk-government-dishes-out-tax-cuts-as-country-braces-for-recession.html |
2-year Treasury tops 4.2%, a 15-year high as Fed continues to jolt short-term rates higher
Yields climbed on Friday and the yield on the 2-year Treasury note notched a new 15-year high as markets assessed the Federal Reserve's latest rate hike and what it means for the economy going forward.
The policy-sensitive 2-year Treasury hit a fresh 15-year record of 4.266% earlier in the session but was last trading at 4.19%.
Meanwhile, the yield on the 10-year hit an 11-year high of 3.829% earlier in the session but last traded two basis points lower at 3.685%.
The climb in yields came as markets weighed the implications of the Federal Reserve's latest policy decisions as it signals its willingness to accept a recession ahead if it means an end to surging inflation.
The Fed on Wednesday delivered another large 75 basis point interest rate hike and indicated it intends to stay aggressive, bumping up interest rates to 4.6% in 2023 and 4.4% by the end of 2022. Global central banks took a note from the Fed's playbook, implementing their own substantial hikes in the wake of the decision.
Even with this week's stark move higher in yields, many analysts believe yields could climb higher.
"While we are likely much closer to the end of the increase in global rates then we are the beginning, it's still going to take a peak in global inflation and a drop in global economic activity for yields to stop this rise and begin to decline," wrote Tom Essaye of the Sevens Report in a note to clients Friday.
Komal Sri-Kumar, president of Sri-Kumar Global Strategies, told CNBC's "Squawk Box" on Friday that he sees the 10-year hitting at least 4% and added that the steepening inverted yield curve suggests a recession ahead. Many analysts interpret short-term rates being significantly higher than long-term rates as a signal of a downturn.
"The bond market anticipates a recession in the first half of 2023 and is already looking forward to the eventual recovery," he said. "That's what happened in 2006, 2007 β we are following the same pattern." | 2022-09-24T13:30:51Z | www.cnbc.com | 2-year Treasury tops 4.2%, a 15-year high as Fed jolts short-term rates higher | https://www.cnbc.com/2022/09/23/10-year-treasury-yield-falls-as-markets-digest-fed-rate-hike.html | https://www.cnbc.com/2022/09/23/10-year-treasury-yield-falls-as-markets-digest-fed-rate-hike.html |
Credit Suisse is recommending stocks with a characteristic favored by Warren Buffett for investors navigating growing risk in equity markets. The firm expects companies with "economic moats" could help investors shield their portfolios from increasing economic uncertainty. It's a term popularized by the legendary investor that refers to a company's ability to maintain competitive advantages against its peers, such as a better business model or scale. "The most important thing [is] trying to find a business with a wide and long-lasting moat around it β¦ protecting a terrific economic castle with an honest lord in charge of the castle," Buffett said at a 1995 meeting, according to CNBC's Warren Buffett Archive. Credit Suisse identified bottom-up opportunities in companies that have high barriers to entry, just as macro risks rise. The firm's strategists pointed to aggressive action against inflation by central banks around the globe, as well as growing risks to 2023 earnings estimates, and recommended investors underweight equities. "Our economists do not rule out a recession and anticipate the US GDP growth to be 0.9% in 2023, compared to -0.2% in the Eurozone," analyst Richard Kersley wrote in a Thursday note. Still, there are opportunities in businesses with protective moats, that have "a superior ability to innovate" with strong pricing power. Here are the names. Shares of Air Products & Chemicals can surge more than 20% from here as the company has "among the most resilient business models," as it's difficult to transport gases over long distances, according to Credit Suisse. The firm has a $295 price target on the company, and shares closed Wednesday at $241.46. Hershey was approved by the firm as it "is poised for an above-algorithm growth year (5%) in 2022" because of its leading market share in confectionary, according to the note. Credit Suisse has a $250 price target on the company, implying 11.9% upside from Wednesday's closing price of $223.41 per share. "Market share gains are likely to persist through 2022 and probably beyond as retailers have awarded the company more shelf space," read the note. McDonald's is "well positioned" to perform regardless of the macro backdrop because of its leading value proposition, according to Credit Suisse. The fast food company is also recovering in overseas markets, read the note. Other companies with protective moats in the Americas include Microsoft , Nextera and Autodesk . βCNBC's Michael Bloom contributed to this report. | 2022-09-24T13:31:47Z | www.cnbc.com | Credit Suisse says buy stocks with this characteristic popularized by Warren Buffett | https://www.cnbc.com/2022/09/23/credit-suisse-says-buy-stocks-with-this-characteristic-popularized-by-warren-buffett.html | https://www.cnbc.com/2022/09/23/credit-suisse-says-buy-stocks-with-this-characteristic-popularized-by-warren-buffett.html |
Bertha Coombs@BerthaCoombs
Investors have looked to health care as a port in the storm during the stock market's volatility over the last year. Now, in a rising interest rate environment, some parts of the sector may be poised for even better returns thanks to their dividends. "When I think about health care, I think of it as being stable companies that are selling things that people need versus things that people want," said Art Hogan, B. Riley Wealth Management chief market strategist. In health care, "you still have companies that are throwing off good yield, so you get stability and good dividend yields." Biotech and pharmaceuticals industries have an average dividend yield of 2.6%, ranking just behind the consumer staples, utilities, and energy sectors. The top three dividend payers are yielding well above the average. Drug development tool maker Viatris yields 5.3%, Gilead Sciences has a 4.6% payout, and Merck spinoff Organon β which specializes in women's health β has a 4.25% yield. But their high yields are due, in part, to their stocks' negative performance. All three are down sharply over the last 12 months, with Viatris and Organon both hitting new lows this week. "The stocks are worth more than their dividend payout. Demand for pharmaceuticals will remain robust and has proven itself as a good play in a slowdown/recession scenario," said Chantico Global CEO Gina Sanchez. She added, however, that "as yields continue to climb, they will face stiffer competition." CNBC Pro screened for the health care stocks with solid dividend yields that are well liked by analysts (more than 50% have rate them as buy) and also outperforming the market. Just two stocks made the grade: drug maker AbbVie and pharmacy and health services giant CVS Health. AbbVie has a dividend yield of 3.9% and more than half of analysts who cover the company rate it a buy. B. Riley's Art Hogan listed the stock among his best dividend picks, noting that while the company's top-selling drug Humira faces competition from biosimilars in 2023 the stock price is heavily discounting the company's estimate growth rate of nearly 6%. Nearly two-thirds of analysts rate CVS Health a buy. The company, which includes pharmacy benefits as well the Aetna health insurance division, has a dividend yield of 2.1%. Over the last three months, CVS shares are up 9%, with the stock's 50-day moving average now poised to move above its 200-day average, a potentially bullish sign form a technical standpoint. While CVS signed an $8 billion deal this month to acquire Signify Health, and has signaled that it is looking to buy more assets to build its services portfolio, the company remains committed to paying a dividend. This week the board approved a quarterly dividend of 55 cents per share. | 2022-09-24T13:32:18Z | www.cnbc.com | Finding yield in health care stocks during the market storm | https://www.cnbc.com/2022/09/23/finding-yield-in-health-care-stocks-during-the-market-storm.html | https://www.cnbc.com/2022/09/23/finding-yield-in-health-care-stocks-during-the-market-storm.html |
Investors should pay close attention to two very different U.K. stocks right now, according to SVM Asset Management's Investment Director Neil Veitch, who named financial services group Lloyds Bank and sports clothing retailer JD Sports . Speaking to CNBC Pro Talks on Thursday, Veitch explained his picks: Lloyds, he believes, will be able to weather a recession in Britain, while JD is attractive due to its global expansion which could boost medium-term growth. Lloyds For Lloyds, the U.K.'s steepening interest rate curve is an advantage as higher rates quickly translate into earnings and the creation of capital for the bank, Veitch argued. "You've got a bank that's still trading below book value with a rock-solid balance sheet." he said. Even a recession β which Veitch believes would be shallow β and associated credit losses should therefore be "manageable," he added. Book value is a gauge used by traders which highlights a company's balance sheet and helps gauge how expensive a stock is. Banking stocks are often affected by recessions as spending and investment is squeezed, and interest rates tend to fall, which would reduce profit margins on products like loans. On Thursday, the Bank of England said the British economy was already in a recession as it hiked interest rates in an effort to curb inflation. Analysts' opinion was previously split, with many not expecting a recession until later in the year. Lloyds' shares are currently trading at Β£48.69 ($55.18) β up by just 0.19% year-to-date. The bank is however still outperforming the FTSE 100 , as the index is down 2.76% over the same timeframe. JD Sports Shares of JD Sports are down considerably year-to-date, by 47%, leaving them at Β£114.45. The sports shoe and apparel retailer is therefore faring worse than the FTSE 100 overall. But Veitch believes investing could pay off in the medium term. "Its got a medium-term growth outlook, as I say, from the Europe and U.S. all trading on 10 times earnings. The risk for reward for us at these sorts of levels looks very attractive," he said. Ten times earnings means a stock is trading at a multiple that is equal to 10 times the company's earnings. The key here is JD Sports' global expansion, which is being encouraged by sportswear giants Nike and Adidas . "They see themselves as premium products, they want those products to be displayed and distributed in the appropriate manner and JD can do that, so they've been encouraging JD to expand outside the UK," Veitch explained. On Thursday, JD reported a 5% rise in global sales for the first half of 2022, in line with analyst forecasts. The company said it still expected to end the year with pre-tax profits, despite those declining by 19% year-on-year between January and July. | 2022-09-24T13:32:30Z | www.cnbc.com | Fund manager names 2 UK stocks he says look very attractive right now | https://www.cnbc.com/2022/09/23/fund-manager-names-2-uk-stocks-he-says-look-very-attractive-right-now.html | https://www.cnbc.com/2022/09/23/fund-manager-names-2-uk-stocks-he-says-look-very-attractive-right-now.html |
Scott Cohn@ScottCohnTV
Among the historic climate provisions in the Inflation Reduction Act are expanded incentives for producing biofuels like ethanol.
The new law builds on existing credits for renewable fuels, but it doesn't add any new protections against fraud in the program.
One of the most notorious scams involved members of a polygamous religious sect in Utah and a shady California businessman who called himself "the Lion."
The Polygamist & The Bio Fuel Baron Season Premiere Extended Sneak Peek
The Inflation Reduction Act signed into law by President Joe Biden in August includes historic investments to combat climate change. It may also open new avenues for fraud by expanding a program that has given federal authorities fits for years.
The Renewable Fuel Standard, passed with broad bipartisan support in 2005, uses a system of incentives to raise the percentage of biofuels like ethanol in the nation's fuel supply. One study by the Biotechnology Innovation Organization credited the program with reducing U.S. dependence on foreign oil by nearly 2 billion barrels in its first 10 years.
The new law keeps the system in place for now, extends some credits that were set to expire and adds new benefits for things like ethanol-based aviation fuel. It does not, however, include any new provisions to prevent fraud, which one industry compliance expert said could be a problem.
"In a program where, comparatively, you have little oversight, and there's a way to generate a massive amount of money fraudulently with almost little effort, it seems like those possibilities [for fraud] will still exist," said Peter Whitfield, a partner at law firm Sidley Austin in Washington, D.C., in an interview with CNBC's "American Greed."
The polygamist and 'The Lion'
The Environmental Protection Agency, which regulates the program, says its enforcement division has brought 16 renewable fuel fraud cases in just the last 10 years, levying civil fines as high as $27 million. Many more cases have been referred to the Justice Department for criminal prosecution.
Some of those crimes have been particularly brazen. In 2019, members of a polygamous, Utah-based religious sect known as "The Order" pleaded guilty to conspiring with a Los Angeles businessman who called himself "The Lion" to bilk the federal government out of some $1 billion in a scheme involving Renewable Fuel Standard credits and related IRS tax credits.
Using a series of shell companies and sham transactions, the team made it look like they were producing massive amounts of biofuel at a plant in northern Utah and shipping it far and wide. That allowed them to rake in millions of dollars in incentives, even though they were producing very little fuel.
The extent of the scam came to light only after a member of the sect who happened to work in the accounting department broke away from the group β she said she was about to be forced to marry her cousin β and told authorities what she knew.
"You're looking at this small plant in northern Utah that's claiming millions, then tens of millions, then hundreds of millions of dollars in credits from the IRS for producing biodiesel," said Arthur Ewenczyk, a former Justice Department trial attorney. "And it doesn't add up."
Cars line up at a Sunoco gas station offering high-level ethanol-gasoline blends at a cost below regular gasoline, Wednesday, April 13, 2022, in Delray Beach, Fla.
The sect practices what it calls "voluntary consecration of wealth," where all business and all money is shared with the group.
Four members of The Order, including the scam's confessed ringleader, Jacob Kingston, pleaded guilty to federal conspiracy charges. In 2020, a federal jury in Salt Lake City convicted their partner in crime, businessman Lev "The Lion" Dermen, on multiple felony counts including conspiracy, fraud and money laundering. No sentencing dates have been set.
The Order itself has not been charged with wrongdoing. The group said that it was unaware of the fraud, and that it has been unfairly targeted because some of its members practice "plural marriage."
The Justice Department said its investigation is continuing.
Reining in fraud
The EPA says it has continued to beef up its enforcement as it learns more about implementing the program β and as incentives expand under the Inflation Reduction Act.
"EPA intends to continue to regularly update its compliance and oversight regulations to help prevent RFS fraud," said spokesman Tim Carroll in a statement emailed to "American Greed."
The EPA's criminal investigation division tracks the program, analyzing suspicious patterns and matching credits with actual fuel produced.
And Carroll said the agency has begun working more closely with the IRS, like it did on the case in Utah.
"That relationship allows the IRS to use EPA reporting data to identify potential fraudulent activity," Carroll said.
But Whitfield is skeptical about investigators' ability to catch every fraud as the programs expand.
Among the issues he noted is that the Inflation Reduction Act is creating a larger pool of biofuel incentives at a time when the raw material or "feedstock" for the fuels β such as corn, wood pulp and even cooking grease β is expensive or in short supply. That could lure some to try and cheat in order to collect the lucrative biofuel credits.
"Somebody may decide to build a facility that's the equivalent of a bridge to nowhere, right? You build a facility that can produce biofuel, but you never have any intention of operating it," he said. "So, you're just spending money to take advantage of the Inflation Reduction Act."
But at the same time, the expansion of the incentive programs is encouraging bigger companies to get involved, he said. That could help reduce fraud, since the big players have less of a reason to cheat, and more resources to devote to compliance.
Corn is loaded onto a truck as a silo is emptied at a farm in Illinois.
Daniel Acker | Reuters
"You see more refining companies investing in the technology. You're probably going to see airline companies investing in the technology," he said. "You're less likely to see fraud when some of the bigger companies and sophisticated companies are in the program."
Besides, many of the renewable fuel programs are widely popular, with support from environmental groups, agricultural interests and lawmakers from across the political spectrum. The tricky part is keeping it all going, while keeping the crooks out.
See how a determined teenage girl exposes a billion-dollar biofuel fraud, and helps cage "The Lion." Watch the ALL-NEW season premiere of "American Greed," Tuesday, Sept. 27, at 10 p.m. ET only on CNBC. | 2022-09-24T13:33:13Z | www.cnbc.com | Inflation Reduction Act's expanded biofuel incentives raise concerns about fraud | https://www.cnbc.com/2022/09/23/inflation-reduction-acts-expanded-biofuel-incentives-raise-concerns-about-fraud.html | https://www.cnbc.com/2022/09/23/inflation-reduction-acts-expanded-biofuel-incentives-raise-concerns-about-fraud.html |
Stocks took a beating this week as the Federal Reserve raised interest rates by another 75 basis points, the third consecutive hike of that magnitude. It wasn't the rate move β which was anticipated by the market β but Fed Chair Jerome Powell's hawkish comments on Wednesday that hurt stocks. He's now targeting a rate of 4.4% at the end of the year, up from the 3.4% rate projected at the central bank's June meeting. It was the fifth losing week out of the last six for all the major stock averages, capped by another painful drop on Friday. The one bright side is that this vicious selling is creating bargains and opportunities for those with a long-term mindset. The S & P 500 Short Range Oscillator should be at an extreme oversold reading after Friday. Perhaps it will be minus 10%, maybe even lower. (Anything below a minus 5% indicates the market is oversold.) We'll be watching the 2-Year Treasury for a sign that it's okay to buy stocks. Jim Cramer believes that if the yield on the 2-Year stabilizes β meaning it doesn't keep climbing throughout the next session β then we have to put some money to work because the market is so oversold. If the 2-Year yield continues to soar, then that may mean more pain lies ahead for equities. We've been slow to deploy our precious cash during this malaise. But after talking it over, Jim and the team believe the plan is to slowly step up our buying Monday into two or three positions β only into high-quality companies and yes, perhaps an oil firm β given the magnitude and speed of this decline. Under the hood this week, all sectors lost ground, with energy leading to the downside followed by consumer discretionary and real estate. Meanwhile, the U.S. dollar index advanced to the 113 level, notching its best week since March 2020. Gold pulled back to around the $1,650 per ounce. WTI crude prices fell below $80 per barrel. The yield on the 10-year Treasury advanced to the 3.7% level. Looking back On the earnings front, we got results from Costco (COST) on Thursday. On Tuesday, we learned that housing starts for the month of August came in at a seasonally adjusted annual rate (SAAR) of 1.575 million, ahead of expectations of a 1.45 million. Building permits, on the other hand, were below expectations at a 1.517 million SAAR, missing the 1.6 million estimate. Existing home sales were reported on Wednesday to have fallen to a 4.8 million unit SAAR, the slowest sales pace since May 2020. Also Wednesday, the Federal Reserve raised the federal funds rate by another 75 basis points while maintaining its hawkish tone. On Thursday, initial jobless claims for the week ending Sept. 17 came in at 213,000, an increase of 5,000 from the prior week and below expectations of 215,000. What's ahead No portfolio companies will be reporting next week. Here are some other earnings reports and economic numbers to watch in the week ahead: Tuesday, September 27 Before the bell: Cracker Barrel (CBRL), Jabil (JBL), United Natural Foods (UNFI) After the bell: BlackBerry (BB), Cal-Maine Foods (CALM) 8:30 a.m. ET: Durable Goods Orders 10:00 a.m. ET: New Home Sales Wednesday, September 28 Before the bell: Cintas (CTAS), Paychex (PAYX), Thor Industries (THO), Stem Inc. (STEM) After the bell: Vail Resorts (MTN), Jefferies Financial (JEF), Concentrix (CNXC), MillerKnoll (MLKN) 10:00 a.m. ET: Pending Home Sales Thursday, September 29 Before the bell: Bed Bath & Beyond (BBBY), Rite Aid (RAD), CarMax (KMX) After the bell: Micron (MU), Nike (NKE) 8:30 a.m. ET: Initial Jobless Claims 8:30 a.m. ET: Gross Domestic Price Index Friday, September 30 Before the bell: Baker Hughes (BKR) 8:30 a.m. ET: Personal Spending and Income (See here for a full list of the stocks in Jim Cramer's Charitable Trust is long.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
U.S. Federal Reserve Board Chairman Jerome Powell holds a news conference after Federal Reserve raised its target interest rate by three-quarters of a percentage point in Washington, September 21, 2022. | 2022-09-24T13:33:32Z | www.cnbc.com | Here's our plan for Monday after another painful week to own stocks | https://www.cnbc.com/2022/09/23/it-was-another-painful-week-to-own-stocks-but-we-have-a-new-plan-for-monday.html | https://www.cnbc.com/2022/09/23/it-was-another-painful-week-to-own-stocks-but-we-have-a-new-plan-for-monday.html |
New evidence of war crimes in Ukraine
12 vessels depart Ukraine carrying more than 205,000 metric tons of agricultural products
The organization overseeing the export of agricultural products from Ukraine said it has approved 12 vessels to leave the besieged country.
The ships are destined for Bangladesh, Romania, France, Bulgaria, Italy, Spain, Turkey and the Netherlands.
Read more about what Ukraine is exporting through the Black Sea Grain Initiative and where it is going.
Putinβs mobilization of 300,000 more troops unlikely to resolve basic problems in Ukraine, experts say
Service members of the self-proclaimed Luhansk People's Republic (LPR) line up to vote during a referendum on joining LPR to Russia, at a military unit in Luhansk, Ukraine September 23, 2022.
The "partial mobilization" President Vladimir Putin rolled out Wednesday aims to add an additional 300,000 reservists to the front, according to Defense Minister Sergey Shoigu, primarily those with some kind of military experience.
"Realistically, most of these guys haven't been through recent training, and a 300,000 input is incredibly high," he said. "Most Russian soldiers receive most of their training in the units now, but it's hard to imagine the units that are in Ukraine being in any state to train recruits."
Russia had about 1 million active personnel at the start, according to the institute's estimates, though it did not dedicate all its troops to Ukraine.
Forcing dissidents and unwilling Russians into the military would likely exacerbate what are widely believed to be deep problems with morale within the rank and file.
Read the full story on NBC News.
White House prepared to impose additional sanctions on Russia following 'sham referendum'
White House Principal Deputy Press Secretary Karine Jean-Pierre conducts a daily press briefing at the James S. Brady Press Briefing Room of the White House on Feb. 14, 2022 in Washington, DC. Jean-Pierre announced on March 27, 2022 that she tested positive for Covid-19.
Alex Wong | Getty Images News
The Biden administration said it was prepared to impose additional sanctions on Russia following a referendum held in parts of UKraine.
On Wednesday, Russian President Vladimir Putin voiced his support for a referendum to decide if four occupied regions of Ukraine should join Russia. The move is believed to be a Kremlin attempt to annex additional swaths of its ex-Soviet neighbor.
"We are prepared to impose additional swift and severe economic costs on Russia along with our allies and partners in response to these actions if they move forward with annexation" White House press secretary Karine Jean-Pierre said during a daily news briefing.
"We have sent a loud message and our allies have as well about this illegitimate vote," she said, adding that the U.S. and its allies will never recognize land Russia annexes from Ukraine.
U.N. commission says Russian troops committed war crimes
A team of experts tasked by the U.N. said in a new report that Russian troops committed war crimes in Ukraine.
The Independent Commission of Inquiry, which was set up by the U.N. to probe the conduct of the ongoing war, published grisly findings after visiting nearly 30 cities in four Ukrainian regions.
"We have inspected sites of destruction, graves, places of detention and torture, as well as weapon remnants and consulted a large number of documents and reports," said commission Chairman Erik Mose told the U.N. Human Rights Council.
Mose said that the commission documented several cases in which "children have been raped, tortured, and unlawfully confined."
He added that many bodies showed visible signs of torture before execution, including bound hands, wounds to the head and slit throats."
The Kremlin has previously denied that its troops have committed war crimes.
More than 400 bodies exhumed from mass burial site in Izium with many of them showing signs of violent death, Ukrainian official says
A Ukrainian official overseeing the Kharkiv region said that 436 bodies were exhumed from a mass burial site in Izium.
"Most of them have signs of violent death and 30 have traces of torture," Oleh Synehubov, head of the regional military administration in Kharkiv wrote in an update on the Telegram messaging app.
"There are bodies with ropes around their necks, with bound hands, with broken limbs and gunshot wounds. Several men have amputated genitalia. All this is evidence of the terrible tortures that the occupiers subjected the residents of Izium to," Synehubov added.
He said that most of the bodies that were recovered were civilians and at least 21 were part of the Ukrainian armed forces. Synehubov said that a team of 200 people, including forensic experts and investigators helped exhume the bodies.
More than 191 vessels carrying grain and other crops have left Ukrainian ports
The Joint Coordination Center, an initiative of Ukraine, Russia, the United Nations and Turkey, said the ships transported a total of 4.35 million metric tons of grain and other food products.
Three NATO allies still have to approve Sweden and Finlandβs entry into the alliance
Three NATO member countries have yet to sign ratification protocols for Finland and Sweden to join the military alliance.
Out of NATO's 30 member countries, Hungary, Slovakia and Turkey are the last holdouts to grant Sweden and Finland membership.
Senior Chinese diplomat presses Ukraine foreign minister for 'peaceful settlement'
Senior Chinese diplomat Wang Yi told Ukraine Foreign Minister Dmytro Kuleba that all efforts conducive to peaceful settlement of the Ukraine crisis must be supported, state media reported on Friday.
Both diplomats last spoke to each other on a call in April.
World's largest yacht with ties to Russian oligarch is relocated to dock in Germany by authorities
The super-yacht Dilbar is pulled into a covered floating dock of Luerssen shipyards on the Weser river at the harbour of Bremen on September 23, 2022. - The 156-meter-yacht had stayed since October 2021 for repairs in dry dock at a German shipbuilding company at Hamburg's harbour, northern Germany, and is considered the world's biggest by tonnage. It is owned the Russian billionaire Alisher Usmanov, 68, who has been among dozens of Russian oligarchs hit by punishing Western sanctions over Russian President Vladimir Putin's invasion of Ukraine. (Photo by FOCKE STRANGMANN / AFP) (Photo by FOCKE STRANGMANN/AFP via Getty Images)
Focke Strangmann | Afp | Getty Images
The world's largest superyacht with ties to Russian billionaire and business tycoon Alisher Usmanov was pulled into a dock in Bremen, Germany.
The stunning superyacht was initially restricted from leaving its anchorage by German authorities on March 3. Usmanov entered the crosshairs of the U.S. and its allies following coordinated global sanctions on Russian elites with Kremlin ties after Russia invaded Ukraine on Feb. 24.
The yacht, named Dilbar after Usmanov's mother, extends over 500 feet and is equipped with two helipads and the largest indoor swimming pool ever installed on a private vessel. The Department of Treasury estimates that the current value of Usmanov's yacht is approximately $735 million.
436 bodies exhumed from mass grave; 30 show signs of torture, Ukraine says
Investigators carry away a body bag in a forest near Izyum, eastern Ukraine, on September 23, 2022, where Ukrainian investigators have uncovered more than 440 graves after the city was recaptured from Russian forces, bringing fresh claims of war atrocities.
Ukrainian officials reported that 436 bodies have been exhumed from a mass grave in the eastern city of Izium, 30 of which show visible signs of torture.
The site was found shortly after Ukrainian forces recaptured the territory, which had been under occupation by Russian forces for roughly six months.
Three additional mass burial sites have been found in areas reclaimed during the Ukrainian forces' rapid counteroffensive in the northeastern Kharkiv region, the region's governor Oleh Synyehubov and its police chief Volodymyr Tymoshko told reporters.
Numerous mass graves were uncovered earlier this year by Ukrainian authorities around cities and towns that had been occupied by Russian troops. Moscow rejects accusations of its forces being behind the deaths.
Long lines are building at Russia's borders as many try to flee mobilization call
Cars coming from Russia wait in lines at the border checkpoint between Russia and Finland near Vaalimaa, on September 22, 2022.
Long lines of cars are building up at Russia's borders with its neighbors, numerous news agencies have reported, as many Russians try to leave the country following President Vladimir Putin's call on Wednesday for "partial" mobilization to fight in Ukraine.
Some men have waited as long as 24 hours, as governments in European countries debate whether to allow the fleeing Russians into their countries.
"I have been waiting in my car since Thursday afternoon," one man at the Russian-Georgian border was cited by The Guardian as saying. "Everyone is worried that the border will be closed by the time we get anywhere close to it," he said.
Videos posted to social media show some men using bicycles and scooters to cut through the standstill traffic. By Thursday, more than 1,300 people had been arrested in Russia for protesting Putin's mobilization order.
Putin backs himself further into a Ukrainian corner after threats of nuclear warfare, experts say
Russian President Vladimir Putin talks to the media following the Shanghai Cooperation Organisation (SCO) leaders' summit in Samarkand on September 16, 2022.
Sergei Bobylyov | AFP | Getty Images
Russian President Vladimir Putin's renewed nuclear threats have raised fears that his plans for escalation in Ukraine may not be limited to mobilizing more troops.
While he has issued apocalyptic threats against the West before, Putin's thinly veiled warnings in a rare national address Wednesday signaled that he was willing to raise the risk of nuclear conflict to avoid an embarrassing military defeat.
UN records nearly 6,000 killed in Ukraine since start of war, but full death toll likely higher
China βreaffirms respect for Ukraineβs territorial integrity,' Ukraine's Kuleba says
China has expressed its respect for the integrity of Ukraine's land, Ukrainian Foreign Minister Dmitry Kuleba wrote on Twitter after meeting with Chinese Foreign Minister Wang Yi during the UN General Assembly in New York.
"I met with State Councilor and Foreign Minister Wang Yi to discuss relations between Ukraine and China. My counterpart reaffirmed China's respect for Ukraine's sovereignty and territorial integrity, as well as its rejection of the use of force as a means of resolving differences," Kuleba wrote.
Chinese media cited Wang as saying that all efforts toward a peaceful solution to the conflict in Ukraine must be supported. China's position toward the war has been described by analysts as a careful balancing act, never reneging on its alliance with Russia while also expressing its opposition to conflict in Ukraine.
Russian forces have forcibly deported as many as 1.6 million Ukrainians, U.S. official says
Russian forces have forcibly deported between 900,000 and 1.6 million Ukrainians into Russia, the U.S. ambassador to the U.N. Human Rights Council said.
"Numerous sources indicate that Russian authorities have interrogated, detained and forcible deported between 900,000 and 1.6 million Ukrainian citizens," Michele Taylor told the U.N. Council, urging its members to investigate "the growing evidence of Russia's filtration operations, forced deportations and disappearances."
Ukraine and Western governments have accused Russian forces of forcibly moving Ukrainian nationals to "filtration camps" and then transporting them to Russia. Moscow has rejected the accusations, calling them "fantasy."
The forced deportation of civilians from one country to another is considered by the U.N. and the International Committee of the Red Cross to be a war crime.
A boy wearing a T-shirt with the letter 'Z', the tactical insignia of Russian troops in Ukraine, and holding a flag of the self-proclaimed Donetsk People's Republic (DNR) - the eastern Ukrainian breakaway region - stands at the entrance to the DNR embassy in Moscow on September 23, 2022, as Moscow-held regions of Ukraine vote in annexation referendums that Kyiv and its allies say are illegal and illegitimate.
Beatrice Fihn, Nobel laureate and executive director of the International Campaign to Abolish Nuclear Weapons, told CNBC that Putin's "incredibly dangerous and irresponsible" threats drastically increase the risk of escalation to a nuclear conflict.
Thu, Sep 22 20224:42 PM EDT | 2022-09-24T13:34:34Z | www.cnbc.com | Live updates: Latest news on Russia and the war in Ukraine | https://www.cnbc.com/2022/09/23/russia-ukraine-live-updates.html | https://www.cnbc.com/2022/09/23/russia-ukraine-live-updates.html |
Inflation remains the top issue on investors' minds, with many trying to determine when the relentless rise in prices will stop and whether the Federal Reserve's aggressive interest rate hikes to try to halt the spiral will engineer a so-called soft-landing for the economy β or, instead, send us into a deep recession. Indeed, your views on the trajectory of inflation will determine your views on future Fed actions β and, therefore, how you decide to put your money to work. Central bank tightening β under the umbrella of monetary policy β is only one side of the equation when it comes to managing inflation. The other is fiscal policy, which is controlled by lawmakers in Congress. Coordinated fiscal- and monetary policy can have a compounding effect in stamping out inflation. But in the current inflationary environment, an expansionary U.S. fiscal policy β one that includes high levels of spending from Covid pandemic stimulus measures through to the recently passed Inflation Reduction Act β has been largely undermining the Fed's efforts to rein in runaway prices. As JPMorgan CEO Jamie Dimon told lawmakers at a banking hearing Wednesday on Capitol Hill, "I don't think you can spend $6 trillion and not expect inflation." I don't think you can spend $6 trillion and not expect inflation. JPMorgan CEO Jamie Dimon This phenomenon is not unique to the United State. In the U.K., the Bank of England on Thursday raised its base interest rate by 50 basis points, even as Prime Minister Liz Truss' government on Friday unveiled sweeping tax cuts to spur consumer spending. "What is worrisome in the last 24-48 hours β¦ is an accelerated loss of confidence in policymaking," Allianz advisor Mohamed El-Erian told CNBC Friday. "Policymaking [is] going from being a repressor of volatility to an amplifier of volatility," he added. Both central banks and lawmakers have two main tools they can use to impact the money supply in the economy β and every investor should be familiar with them. At a high level, these policies are used to cool an overheated economy or stimulate a stagnant one. When the goal is to put the brakes on economic activity, money needs to be pulled out of circulation to reduce the number of dollars competing for goods, and thereby limiting inflation. On the other hand, to stimulate activity requires pumping liquidity into the economy to encourage spending. Policymaking [is] going from being a repressor of volatility to an amplifier of volatility. Allianz advisor Mohamed El-Erian In the U.S., the Fed has two main tools at its disposal to achieve its dual mandate of maximizing employment and maintaining long-term price stability: interest rate hikes and open market activity. When raising its key fed funds overnight bank lending rate, the Fed is directly raising borrowing costs between banks. By raising the rate, the Fed is seeking to disincentivize borrowing to douse an overheated economy. Conversely, when the Fed reduces the fed funds rate, it's lowering lending costs to encourage both borrowing and spending to fuel the economy. The Fed can also impact rates and the number of dollars in circulation by purchasing securities on the open market, known as open market activity. In an expansionary scenario β like the one we had in 2020 β the Fed seeks to purchase Treasuries and corporate bonds, thereby pumping money (liquidity) into the market in what's called quantitative easing (QE). On the other hand, a more contractionary monetary policy β like we're experiencing now β would see the Fed reduce its balance sheet by letting bonds mature without purchasing new ones, decreasing the number of dollars in circulation. On the fiscal side, the federal government's two main tools for managing the economy are taxes and spending. If policymakers slow economic activity, they may look to the restrictive approach of raising taxes, thereby lowering consumers' after-tax discretionary income β and, as a result, reducing their buying power. The policy has the result of effectively pulling money out of circulation. Expansionary policy implies the opposite β lowering taxes to keep more discretionary dollars in consumers' pockets and incentivizing spending. On the spending side, if the government wants to stimulate the economy, it can spend more on public investments like infrastructure that generate jobs and sales. A restrictive policy would see spending reduced, thus lowering the supply of money coming into the economy via government contracts, with knock-on effects for workers and commerce. On the monetary policy front, we are currently getting exactly what we'd expect in a highly inflationary environment: rate hikes and balance sheet reduction, which help suck excess liquidity out of the market. But given that U.S. fiscal policy is not acting in concert with monetary policy, the Fed's efforts to bring down inflation have become all the more complicated. In the years since the 2007-2009 global financial crisis, expansionary fiscal policy β and monetary policy for that matter β has not posed much of a problem due to overall low inflation. Indeed, the last time the U.S. implemented a true contractionary fiscal policy was during the Clinton administration when taxes were raised, spending was reduced, and the federal budget flipped from a deficit to a surplus. It is because of these seemingly contradictory policies that we have been of the view as Jim Cramer puts it: "Every time Fed Chair Jerome Powell seems to get a handle on inflation, the government throws him for a loop." In the end, we believe the Fed will win the war on inflation. However, it may just take longer than it otherwise would have. As Powell is attempting to slam on the breaks, government spending is acting like a foot on the gas pedal β drawing out this bout of inflation. (See here for a full list of the stocks in Jim Cramer's Charitable Trust.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
U.S. Federal Reserve Board Chairman Jerome Powell departs after holding a news conference after Federal Reserve raised its target interest rate by three-quarters of a percentage point in Washington, September 21, 2022. | 2022-09-24T13:35:29Z | www.cnbc.com | U.S. fiscal policy is undermining the Fed's efforts to fight inflation | https://www.cnbc.com/2022/09/23/us-fiscal-policy-is-undermining-the-feds-efforts-to-fight-inflation.html | https://www.cnbc.com/2022/09/23/us-fiscal-policy-is-undermining-the-feds-efforts-to-fight-inflation.html |
U.S. Federal Reserve Board Chairman Jerome Powell pauses during a news conference after Federal Reserve raised its target interest rate by three-quarters of a percentage point in Washington, September 21, 2022.
Credit card rates are the highest since 1996, mortgage rates are the highest since 2008 and auto loans are the highest since 2012.
chief financial analyst at Bankrate | 2022-09-24T13:35:47Z | www.cnbc.com | What to do with your money during rising interest rates | https://www.cnbc.com/2022/09/23/what-to-do-with-your-money-during-rising-interest-rates.html | https://www.cnbc.com/2022/09/23/what-to-do-with-your-money-during-rising-interest-rates.html |
The stark warning came from one of the tech world's most prominent CEOs. Sitting before an audience at the World Economic Forum in Davos, Switzerland, three years ago, Alphabet CEO Sundar Pichai said quantum computing has the power to transform humanity's understanding of the natural world, enabling scientists to create new drugs and better batteries, among other advances. But with that great promise comes peril: A commercially viable quantum computer is widely expected to be able to penetrate the encryption techniques that secure the world's financial and communications networks. "The potential is huge, but we will have challenges," Pichai said. "In a five- to 10-year timeframe, quantum computing will break encryption as we know it." After decades of incremental progress in quantum computing, a group of tech giants and startups are on the cusp of beginning to commercialize it. As more pure-play quantum firms become publicly traded companies, investors would do well to at least monitor the burgeoning field, which analysts expect has the potential to disrupt the technology world, creating billions of dollars of value in the process. Since its conceptual birth in the early 1980s, quantum computing has held promise for systems that could exponentially outperform today's computers. Rather than leaning on the zeroes and ones of classical computers, quantum computers emerged from quantum physics, which is the study of the fundamental building blocks of matter and energy. The laws of quantum mechanics allow the tiniest of particles to exist in multiple states at the same time. So unlike the binary bit of regular computers, the quantum bit, or qubit , can simultaneously be a combination of zero and one, as well as any value in between. Those strange properties account for the technology's potentially explosive abilities; each additional qubit doubles a quantum computer's power. Quantum leaps The race to achieve a working quantum computer capable of solving problems beyond the reach of today's computers heated up in 2019. That's when researchers at Alphabet's Google division claimed a breakthrough : They said their 54-qubit machine known as Sycamore performed a task in minutes that would take traditional supercomputers 10,000 years. Not to be outdone, IBM announced in May that it plans on delivering a 4,000-qubit computer by 2025 . While industry observers say the threshold for widespread commercial use would be a 100,000-qubit machine, IBM claims its quantum computer will be able to start addressing some of the more basic problems the technology is supposed to solve, including portfolio optimization for financial firms. Though still in its infancy, the market for quantum computing hardware and services will grow at a 50% compound annual rate from $475 million last year to roughly $2.5 billion by 2025 and $19 billion by 2030, according to Cowen analysts. Cowen's Krish Sankar likened the nascent field of quantum companies to early-stage biotech firms where it's "hard to forecast when the drug takes off." Many of the companies are using different strategies for tackling the problem of scaling up in qubits. "Nobody knows which is going to work; maybe they all do," Sankar said. "Most of them have a timeline in the next three to five years to get enough qubits" for commercialization, he added. Since the next-generation computers are expected to be able to simulate chemical reactions on a molecular scale, allowing for leaps in material science and drug creation, it is pharmaceutical, chemical and automotive companies that stand to be among the first sectors to benefit. But that computational power brings risks, as referenced by Alphabet's Pichai. Quantum computers are expected to be able to solve the mathematical problems that underpin much of today's encryption techniques, exposing the security of websites and email, for instance. That could threaten global financial and technology firms and pose a risk to cryptocurrencies, potentially allowing hackers to steal bitcoins, for instance. That has spurred investment and greater awareness among corporate executives. For instance, JPMorgan Chase has built an internal team of scientists to, among other things, help spur the development of next-generation communication networks that are safe from the quantum threat. Almost 40% of large corporations are expected to start their own quantum projects by 2025, according to research firm Gartner. Given the prohibitive expense and bulky size of quantum computers, most companies are expected to tap the technology via the cloud, analysts say. Interest in the futuristic technology β which typically requires maintaining large hardware rigs at super-cold temperatures β has exploded in recent years as venture capital investors pour money into the sector. Startups focused on quantum tech received $1.4 billion in funding last year, double the industry's haul in 2020, according to McKinsey. Still, the nascent sector has been hammered this year in the tech rout. Several of the public quantum companies took advantage of last year's window for smaller, unprofitable companies to list via SPAC transactions. But all of them are currently trading below their listing prices and are out of favor with investors who now prioritize profits over growth. The influx of money and growing coverage of the technology has generated a backlash. It's unclear if a "large scale, fault tolerant" quantum machine will ever be built, Oxford University physicist Nikita Gourianov wrote in an August op-ed . According to Gourianov, quantum computers are an overhyped bubble without practical applications. Among their challenges, the computers are extremely sensitive to environmental disturbances that corrupt its information, making them highly error prone. A numbers game But there are two reasons that quantum computing should overcome its technical challenges, according to Konstantinos Karagiannis , a quantum-computing specialist at consultant Protiviti. Quantum computers will be able to compensate for bad qubits (caused by infinitesimal amounts of heat or electromagnetic fields) through a technique called " error correction ," he said. On top of that, bigger quantum computers will be made by connecting smaller modules, he added. "I've seen some amazing advancements in qubit fidelity," Karagiannis said in an interview. "We don't need perfect qubits, we need them to be really good, and then we need enough of them to do what's called error correction." While more than 200 quantum-related companies exist today, just four of the so-called pure plays are publicly traded, according to Bernstein. They are named D-Wave Systems , Rigetti Computing, IonQ , and Quantum Computing. Cowen recommends Berkeley, California-based Rigetti Computing , which develops circuits for quantum computers and offers a cloud platform that enables engineers to design quantum algorithms. The 9-year-old company, founded by a former IBM physicist, is "well positioned" to benefit from the adoption of quantum computing as a service, according to Cowen. Quantum Computing focuses on software solutions for businesses and is buy rated by Ascendiant Capital Markets' Edward Woo, who expects "strong growth" over the next year as the company ramps up marketing. "By being early in this rapidly growing industry, we believe Quantum is well positioned to capture and drive a meaningful market share," Woo wrote in a recent note raising his price target on the Leesburg, Virginia-based firm to $9.50. The stock has declined 33% this year and last closed at $2.27, implying a 319% gain if Woo's target is met. Other firms that will capture revenue from quantum computing include Applied Materials and MKS Instruments, according to Cowen. Applied Materials, which supplies equipment for makers of semiconductors and displays, will benefit from rising demand for superconducting chips, Cowen said. MKS , a supplier for semiconductor manufacturers and advanced electronics, can supply the industrial lasers needed in various quantum rigs. Still, even its boosters concede that the adoption of quantum computing could be a bumpy journey for investors, given the speculative nature of the field and the unknowns around commercialization. A more conservative way to play the sector could be through owning established big tech companies. Alphabet and IBM are poised to be major players in quantum computing, if their investments are any indication. Last year, Alphabet's Google announced a multibillion-dollar plan to build a commercial-grade quantum computer by 2029, aided by its new quantum campus in California. Meanwhile, IBM has made among the biggest commitments to quantum, with several hundred employees, more than 20 quantum computers and a cloud service with more than 360,000 users. Last year, Microsoft launched its cloud service Azure Quantum , a full stack offering that allows customers to access quantum hardware and software. The tech giant has eight quantum computing labs around the world and is working on developing its own quantum computer relying on a potentially more stable form of technology. Quantum supremacy The efforts from large, well-financed companies as well as startups bode well for the industry. So-called quantum supremacy β the moment when quantum computers are able to reliably perform calculations far beyond the scope of traditional supercomputers β could happen by decade's end, according to JPMorgan's Marco Pistoia , a quantum expert who spent most of his career at IBM. "Even now that quantum computers are not yet that powerful, we don't have so much time left," Pistoia said in a podcast . Corporations need to prepare for that moment now or risk falling behind, he said. That progress offers others encouragement. "We're seeing these milestones happening, so I'm certain we're going to get there," Karagiannis said. "The machines are getting really, really good." | 2022-09-24T13:36:30Z | www.cnbc.com | Quantum investing: Perils and promise of quantum computing are nearing | https://www.cnbc.com/2022/09/24/quantum-investing-perils-and-promise-of-quantum-computing-are-nearing.html | https://www.cnbc.com/2022/09/24/quantum-investing-perils-and-promise-of-quantum-computing-are-nearing.html |
This market is not the dot-com crash or the financial crisis. Here's how to play it
We fear pretty much everything right now. We fear higher prices, traditional inflation. And we fear lower prices, cascading oil and copper. We fear the 2-year Treasury yield going much higher because that would mean another 100 basis points of interest rate hikes by the Federal Reserve this year. We fear it going lower because that would show that Fed Chairman Jerome Powell is letting up on his inflation fight, while it is still raging. We fear that earnings will be awful. But we fear that unemployment remains too low to thwart wage inflation. We fear World War III in Ukraine after Russia's big troop call-up. We fear the Chinese making a run at Taiwan. In short, we fear everything. So, let's step back for a second. While we are not in an FDR moment where the "only thing we have to fear is fear itself," we are not in a situation where things are intractable and the republic hangs in the balance, something that was true in 1933 when we actually did have more to fear than fear itself, and it was true in 2008 when so many big institutions failed that we were lucky the major stock benchmarks weren't cut in half. What we do have is a problem of price: Stocks went up way too much, leading into their peak in November of last year, which was the last time we saw a record high in the Nasdaq . The Dow Jones Industrial Average and the S & P 500 hit their records in early January. That's important because we lack a compass. At this point it means absolutely nothing how far stocks have fallen from their highs. Nothing at all. Or Club holdings Advanced Micro Devices (AMD) and Nvidia (NVDA) would have stopped a long time ago. We have only one benchmark like this and that was 2000 to 2001, when the Nasdaq overshoot by about 3,000 points off a 2,000 point basis. But the Nasdaq, at the time, was filled with unprofitable companies, with stocks soaring even higher, on a percentage basis, than they have now. The S & P 500 never really got out of control back then β and, relative to bonds, it didn't either. So price isn't as important as we tend to think because we don't have enough totems to judge how out of whack things got in November. You have to throw out where a stock has been. It's meaningless. But what's not been meaningless is the relationship between stocks and bonds. Back in 2000, bonds weren't much of a factor. However, back in November of 2021 they were, in retrospect, the most important thing that mattered because there was so much money in the form of stocks and bonds and loans, being created that the run-up, we now realize, had more to do with cheap money than with great earnings. We had an inkling of that when we saw the SPACs (special purpose acquisition companies or so-called blank check companies) and the junk IPOs (initial public offerings) start falling apart. However, with 600 new stocks to analyze, it was a pretty overwhelming moment. At this point, we all wish that Powell had pulled the trigger earlier. Before we are too harsh, though, if you go back to February of 2020, in the beginning of the Covid, only Powell really understood what awaited us, certainly not the president and definitely not Congress at the time. The Fed chairman, correctly, feared the economy was going to crash, and he would have been right. So he went really loose. What people seem to forget is that we were at a very perilous moment, one where you could have expected that American Airlines (AAL), Delta Air Lines (DAL), United Airlines (UAL), Carnival (CCL), Norwegian Cruise Line (NCHL) and Royal Caribbean Cruises (RCL) would have filed bankruptcy and Boeing (BA) not long after. We would still be dealing with the aftermath of something that didn't happen because Powell prevented it. Of course, you are only as good as your last save, and Powell whiffed on this one. Still, we seem to forget that if you look at when he got tough, he was defying the conventional media, which had us all scared that the omicron Covid variant was not only more contagious but more virulent. Looking back he's been hard on himself, just like everyone else, that he started tightening too late. However, can you imagine if he started tightening say, in October 2021, and would have had to loosen two months later because of fear of omicron? The second guessing disgusts me. We were worried about our lives. Because Powell didn't act back then we somehow think, though that it doesn't matter. That he has to tighten so hard that we are going to be in freefall. In truth, the speed with which Powell is tightening is positively Volcker like when it comes to percentages β Paul Volcker (Fed chairman from 1979 to 1987) standing for the great man who saved us from Weimar-like inflation β not the hated man that Powell is soon to be, when we have so many people thrown out of work and credit crises from outfits we have never heard of who borrowed short to buy medium. Yes, I think that the speed with which the 2-year yield is going to β what, 5%? (currently north of 4%) β has more to do with someone who borrowed to buy the 2-year aggressively when it was at 3%, right before Powell's Jackson Hole hawkish address , because that seemed like such an amazing bet. I figure we will soon know who did it and it can explain some of the velocity. The rest of the velocity, though, has to do with the jawboning that Powell has undertaken. The 2-year at more than 4.2% represents a fairly good chance that we get 100 basis points or more this year, only because we forget that two years is not all that far away, and you need the bond to go up in price rather shortly as it does go out at par, something that the fear merchants seem to be in denial about. Remember I am talking about the 2-year at the time of its price at Jackson Hole, not Friday's on the run 2-year. Bond prices and yields move in opposite directions. Because of the speed with which he is acting, Powell has charged out on a path that we have no analogue for which is what's so unnerving. Many of us are still hopeful we could be in for a 1994 soft-landing for the economy but the '94 camp followers are dwindling, replaced by a majority that now accepts that not only is a recession going to happen, it will be a doozy. The dichotomy for me, starting Saturday night when I was flying home from the West Coast, will be hard landing, versus crash landing: a foamed runway versus one where people really get hurt. At least I am not calling for some economic landing of unfathomable proportions, just one where not everyone makes it home. Do I really believe that? Here's where things get really tricky. I still think we will land unscathed after betting that we won't. This moment reminds me of when a plane I was on was struck by lightning. We were coming back from Richmond and we couldn't avoid a storm area so we plowed right through it. The direct hit caused the plane to go boom and then go quiet and all lights went out. We were in free fall for about 8 seconds and then pulled up and some back-up lights went on. We were plenty scared but thought we had survived. Then, though, because the public address system had blown out, the stewards came by, row by row and told us that we would be fine but that not everything was working right. No kidding. It was the second trip around when they told us what was wrong: no landing gear. We would land belly up. So we would have to put our heads between our legs because it was possible that the overheads would collapse. Stupid overheads. I was typing a piece for thestreet.com paying no attention to anything because if we made it, and I had written nothing, I would be in a hell of a jam, and if we didn't make it, well who cares. So the former seemed like a good idea until a bunch of people complained that I wasn't silent and respectful of "the moment" whatever the hell the moment was. We circled and circled over our Newark destination until we had no fuel left and then, like a glider, we landed on the runway at its very beginning. There were firetrucks everywhere and foam all over the place. We bounced four times, each time less high and then we stopped to tremendous applause. We went down those funny chutes which I thought was hilarious and gave each other high fives like we had something to do with it. Anyway, that's the kind of economic crash I hope for. Nobody got hurt. But that is increasingly seeming too optimistic. How about we call this a scary landing, because isn't that where we are? I think that's certainly how people act. Is there such a thing as economic foam? Can a pilot be as good as the nameless U.S. airlines one was on that fateful day? I think that most participants have decided there's no hope and they are using an analogue that's 2000-2001 (dot-com bubble bursting) or even 2007 (before the financial crisis and the Great Recession). I think that both are too dire and here is why: in both periods things were far worse with the economy. We have always been a people with tons of debt; never one with tons of cash. We are the latter now and if you listened to Powell he wants that cash to run out: consider that the jet fuel. When the plane is running on empty, we can land, but not until then, which means that we have to see not only unemployment spike but savings drop severely or at least spending for anything, not just goods go flat on the tarmac. It's scary because, like on that plane from Richmond, the landing gear is so definitively shot. So why not sell everything and huddle in the 2-year Treasury? First, I admit to having the fondness for a 4% yielding piece of paper where I can get my money back. Hey, I am older, I might need it. But what's against that? You have to bet that you can get back in right away. Within two years' time. That's not an easy bet to make. You need to figure that even after the Great Recession many stocks where back to their 2007 levels within 18 months of their March 2009 lows. The only stocks that truly failed to go higher were the bank stocks and they still are awful when it comes to the way they used to trade, which was pretty strong with a good yield. I think they became pathetic because of strong government regulation, which is still with us, and a lack of M & A (merger and acquisition activity), which will always be with us. Everything else, though, made its way back with alacrity and things were far worse then. Tech That is why, after a period of aggressive selling, we want to buy stocks back now, including tech, although less than others if only because the ETFs (exchange-traded funds) have made it hard to distinguish good tech from bad tech. Because of that lack of distinction, it seems that we are going to roll back multiyear moves in tech. But I am not quite sure that is true. Why is that such a hard thing to figure? Because you have lost the reasons we liked tech. First, was Covid where we saw a tremendous surge in video gaming and personal computers; and second, what we thought were secular gains in high performance computing and 5G next generation mobile. Covid created a pull-through in personal computers via work from home that we will have to annualize the full bore buy of tech before the component and PC makers can come back. Gaming seemed so secular and is now looking so cyclical that the losses are staggering. AMD and Nvidia are the prime examples here. But it's cellphones that were supposed to be immune, especially with 5G. That hasn't happened because no one would believe that the Chinese would abandon all reason and stop the process of buying of new phones other than by e-commerce. We just didn't see it. We thought they would be uber-rational. Instead they are uber-crazy. Look out, when they have their coronation of Chinese President Xi Jinping, they are going to be embarking on one terrible national super-spreader event the likes of which we have never seen. Their vaccines only stop 40% at best, so it should be a nightmare for them although who knows for us given how cloistered and combative they have become. I thought that digitization, the cloud, and the high performance computers needed for both, would stay strong and I feel even more so after spending a week in San Francisco, spending time with what most of you would regard as an absurd number of CEOs. I know this: Digitization has not slowed down. The stocks reflect a tougher deal environment and a stronger dollar; but no more than that. Nobody is saying they don't have to digitize. And many are saying that they must go to the cloud as soon as possible, as long as it doesn't hurt earnings, which it does, so they have to be careful by asking for terms that are less onerous on their cloud plans. In other words, expect number cuts but nothing as severe as some stocks are indicating. So, tech's a real issue but not some sort of existential issue. Defense and cybersecurity How about the rest of the market? There's a lot of lazy thinking out there. If we are in a foamed landing, we will wish we had bought, not sold here for a host of stocks except those that are doing so well in an inflationary environment, the bull markets of defense and cybersecurity. They are, for the moment, the only two out there, so at least, when I end my show, I can deliver on my finding the bull. Those two bulls are ferocious and snorting and you can play them best by owning Lockheed Martin (LMT), Raytheon Technologies (RTX), General Dynamics (GD) and Northrop Grumman (NOC) on the military side and Palo Alto Networks (PANW), that one is on our Bullpen watch-list, and CrowdStrike (CRWD) on cyber. Consumer staples I think that some cohorts just seem like they are just fine: the consumer packaged good stocks, a la General Mills (GIS) β in the Club we own Procter & Gamble (PG) ; the utilities because they do well going into, not out of, a recession; and drugs and health-care stocks, which I regard as must buys because if we are going to have a recession then it will most likely create a wave of Republican voting that will allow health care to take its pound of flesh and money. So those groups are fine. We keep buying them. Banks I am about to turn very positive on the banks β the Club holds Wells Fargo (WFC) and Morgan Stanley (MS) β because they can invest your money overnight and make a killing. No one cares right now because they see bad loans all over the place but that's just wrong as the regulatory regime has reduced the ability to make bad loans. There's a lot of cash out there to buy everything and while credit will get tough, the credit balances will allow an outfit like Wells Fargo to do incredibly well. Same with Bank of America (BAC). Oil and natural gas We had been huge holders of oil and natural gas names, twice the amount of exposure to the S & P 500 than the index itself, but we have cut that way back. Good call. The question now is what's the right price of crude? A recession will certainly cause us to use less. The reckless release of the Strategic Petroleum Reserve will stop after the midterms β if you can think that far out. We don't know what will happen in Russia but the call up of reserves means that there will need to be a gigantic slug of oil sold because, unlike in the U.S., the actual payment of soldiers is a big hit to their budget as it was when they went to war against Chechnya. The Russians are hoping that this time they will get it right, as they did in the second war in Chechnya. What they seem to keep forgetting is that the Ukrainian people have reverted to their 1930s stand against Russia: they hate them. Without a turning of the Ukrainian people back to Mother Russia, which is what happened in Chechnya in 1999, the Russians will lose if we keep giving Ukraine modern weapons. No soldiers no matter how many they are, can defeat modern weapons as long as there is a resupply and it does look like we are willing to do so, hence the reason to own defense. So, oil goes to the per-barrel level in the $60s on Russian pumping until they realize they can't win and we have a more normal use pattern. We are so far away from electric vehicles predominating that it isn't even worth considering when oil goes lower and natural gas just isn't that profitable. Retail Which brings me to the rubber and the road: retail. Here, the Costco (COST) conference call is all you need to know. It is the primer we all need, courtesy of Rich Galanti, the best CFO in the world, bar none. In Rich's world we have already passed the peak in a lot of what has caused inflation. We are way down when it comes to containers. We are much better when it comes to supply chain. Most commodities have already peaked. They are actively telling suppliers if you have raised price to us because of transportation, supply chain or raw materials, we want those pries rolled back. As the second largest retailer in North America, and by far the best operator, they are going to bring down prices that you see at their stores. Other store chains will follow or they will lose even more share to Club holding Costco. And they lost a lot of share to Costco during Covid. Costco is to be feared and only Total Wine seems to have lower prices. I say that as someone with a mezcal operation, Fosforo, so I know whereof I speak. Bottom line So, commodity inflation is, AT LAST, coming down which is, just now beginning to translate into lower prices for you, the consumer, because Costco has that kind of clout. It's the beginning of the end of inflation at the consumer level for day to day goods. I will make the same prediction for cars and homes. Autos have been hurt by supply chain but I think that's coming to an end. Club holding Ford (F) was really dinged by a factor that makes nameplates for the Bronco and the F-150 lines hence why they are so confident that the 50,000 vehicles on their lots will soon be delivered. Of course, this is the last group you want to own in a recession but that's exactly why they have fallen so much. I am at last ready to buy back the Ford we sold twice as high as it is now. The Costco call, though, admits that there is no let up in wage inflation and here is where we must end. Powell has just begun the fight against wage inflation with this last hike. Before then it was all catch-up. Now he recognizes the lightning bolt has hit. He has figured out there is no landing gear. But he is confident that he can land the plane after running out of fuel but before the crashed. I remember the looks of the people on the plane before we landed. Everyone thought they were going to die. There was more praying than you could shake a stick at. I didn't think we would. I figure the guy at the wheel's a pro. He knows what he is doing. He has prepared for this moment all of his life. So has Powell. The plane will bounce. The people who put their heads between their legs will be wailing. Me? I am typing. Same as before. (Jim Cramer's Charitable Trust is long AMD, NVDA, WFC, MS, COST and F. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED. | 2022-09-26T01:11:46Z | www.cnbc.com | This market is not the dot-com crash or the financial crisis. Here's how to play it | https://www.cnbc.com/2022/09/25/cramer-this-market-is-not-the-dot-com-crash-or-the-financial-crisis-heres-how-to-play-it.html | https://www.cnbc.com/2022/09/25/cramer-this-market-is-not-the-dot-com-crash-or-the-financial-crisis-heres-how-to-play-it.html |
The government of India's Prime Minister Narendra Modi has looked to boost the country's chipmaking prowess.
India's strength is the huge domestic consumption market when it comes to semiconductors, being the second-largest populous economy in the world.
Partner, Counterpoint Research
SMIC has a long way to go in catching up with TSMC, says analyst | 2022-09-26T03:22:31Z | www.cnbc.com | How India is trying to turn itself into a semiconductor powerhouse | https://www.cnbc.com/2022/09/26/how-india-is-trying-to-turn-itself-into-a-semiconductor-powerhouse.html | https://www.cnbc.com/2022/09/26/how-india-is-trying-to-turn-itself-into-a-semiconductor-powerhouse.html |
An aerial view of Phillips 66 oil refinery is seen in Linden, New Jersey, United States.
On Friday, both Brent and WTI fell around 5% to hit their lowest level since January.
The fall comes as central banks around the world β including the U.S. and the U.K. β continue to hike interest rates in an effort to tackle inflation.
This is a breaking news story and will be updated shortly. | 2022-09-26T07:30:17Z | www.cnbc.com | Brent crude slides below $85 a barrel as dollar surges | https://www.cnbc.com/2022/09/26/brent-crude-slides-below-85-a-barrel-as-dollar-surges.html | https://www.cnbc.com/2022/09/26/brent-crude-slides-below-85-a-barrel-as-dollar-surges.html |
Sterling fell as much as 4.8% to trade below $1.04 in the early hours of Monday morning, extending losses from late last week when Finance Minister Kwasi Kwarteng outlined the new U.K. government's so-called "mini-budget."
The radical policy moves set the U.K. at odds with most major global economies at a time of sky-high inflation and a worsening cost-of-living crisis.
The U.K. Treasury on Monday afternoon said that the government would set out its medium-term fiscal plan on Nov. 23.
Kwarteng requested that the independent Office for Budget Responsibility set out a full forecast alongside the plan, the Treasury said.
"The Fiscal Plan will set out further details on the government's fiscal rules, including ensuring that debt falls as a share of GDP in the medium-term," the Treasury in a statement. | 2022-09-26T16:16:46Z | www.cnbc.com | Bank of England monitoring markets 'very closely' after pound falls | https://www.cnbc.com/2022/09/26/bank-of-england-monitoring-markets-very-closely-after-pound-falls.html | https://www.cnbc.com/2022/09/26/bank-of-england-monitoring-markets-very-closely-after-pound-falls.html |
Trump-linked SPAC changes address to UPS store as investments pulled
The change from a Miami office building to a UPS address came with DWAC's regulatory filing on Friday disclosing its financing losses. The company said it had lost $138.5 million of the $1 billion in financing from private investors in public equity, also known as PIPE, to fund Trump Media after the merger. The contractual obligation for those investors to contribute to former President Donald Trump's media company after the deal had expired last Tuesday, allowing them to pull their funding. | 2022-09-26T19:28:17Z | www.cnbc.com | Trump-linked SPAC changes address to UPS store as investments pulled | https://www.cnbc.com/2022/09/26/trump-linked-spac-changes-address-to-ups-store-as-investments-pulled.html | https://www.cnbc.com/2022/09/26/trump-linked-spac-changes-address-to-ups-store-as-investments-pulled.html |
Meanwhile, certificates of deposit will let you lock in an interest rate for a fixed period of time, which can vary from six months to five years, that ends on what's called the maturity date.
I bonds are certainly worthy of consideration in certain circumstances, but it's not a substitute for an adequately funded emergency savings account. | 2022-09-27T00:11:12Z | www.cnbc.com | Where to get the best return on your cash amid rising interest rates | https://www.cnbc.com/2022/09/26/where-to-get-the-best-return-on-your-cash-amid-rising-interest-rates.html | https://www.cnbc.com/2022/09/26/where-to-get-the-best-return-on-your-cash-amid-rising-interest-rates.html |
The central bank raised benchmark interest rates by three-quarters of a percentage point earlier this month, the third consecutive three-quarter point increase.
Fed officials also indicated they would continue raising rates well above the current range of 3% to 3.25%.
Asked about investor fears that the Fed didn't seem to be waiting long enough to adequately assess the impact of its interest rate hikes, Evans replied, "Well, I am a little nervous about exactly that."
"That offers a path for employment, you know, stabilizing at something that still is not a recession, but there could be shocks, there could be other difficulties," he continued. | 2022-09-27T10:50:41Z | www.cnbc.com | Fedβs Evans nervous about going too far, too fast with rate hikes | https://www.cnbc.com/2022/09/27/feds-evans-nervous-about-going-too-far-too-fast-with-rate-hikes.html | https://www.cnbc.com/2022/09/27/feds-evans-nervous-about-going-too-far-too-fast-with-rate-hikes.html |
"The golden age of globalization that we experienced in the last 30 years since the end of the Cold War has ended clearly and we are entering a new era, a new era that will be marked by greater geopolitical contestation," said Singapore's Deputy Prime Minister and Minister for Finance Lawrence Wong.
Singapore's revenue needs are 'very pressing', says finance minister
There's a decoupling of trends between oil and larger commodity markets: Analyst | 2022-09-27T10:50:44Z | www.cnbc.com | The golden age of globalization has ended: Singapore's Lawrence Wong | https://www.cnbc.com/2022/09/27/the-golden-age-of-globalization-has-ended-singapores-lawrence-wong.html | https://www.cnbc.com/2022/09/27/the-golden-age-of-globalization-has-ended-singapores-lawrence-wong.html |
Do Kwon, co-founder and chief executive officer of Terraform Labs, insists that he is not on the run from South Korean authorities. Meanwhile, South Korean prosecutors claim that Interpol has issued a "Red Notice" for the arrest of Kwon. Terraform Labs, the company that Kwon founded, is behind the collapsed cryptocurrencies terraUSD and luna, which combined were worth $60 billion before they crashed. | 2022-09-27T12:21:56Z | www.cnbc.com | Do Kwon says he's not hiding amid manhunt after UST, luna collapse | https://www.cnbc.com/2022/09/27/do-kwon-says-hes-not-hiding-amid-manhunt-after-ust-luna-collapse.html | https://www.cnbc.com/2022/09/27/do-kwon-says-hes-not-hiding-amid-manhunt-after-ust-luna-collapse.html |
NASA's giant Artemis 1 moon rocket is rolled back to the Vehicle Assembly Building off its lauchpad, after postponing the much-anticipated mission a third time due to the arrival of Hurricane Ian and other technical problems, in Cape Canaveral, Florida, U.S. September 27, 2022.
NASA rolls out its most powerful rocket ever | 2022-09-27T19:54:49Z | www.cnbc.com | NASA's Artemis 1 moon mission likely delayed to November | https://www.cnbc.com/2022/09/27/nasas-artemis-1-moon-mission-likely-delayed-to-november.html | https://www.cnbc.com/2022/09/27/nasas-artemis-1-moon-mission-likely-delayed-to-november.html |
Why Mark Cuban keeps working, even though he wanted to retire at 35: βIβm too competitiveβ
Team owner Mark Cuban celebrates as the Dallas Mavericks take on the Phoenix Suns in the second quarter in Game Six of the 2022 NBA Playoffs Western Conference Semifinals at American Airlines Center on May 12, 2022 in Dallas, Texas. | 2022-09-28T02:34:58Z | www.cnbc.com | Mark Cuban says heβs 'too competitive' to retire at age 64 | https://www.cnbc.com/2022/09/25/mark-cuban-says-hes-too-competitive-to-retire-at-age-64.html | https://www.cnbc.com/2022/09/25/mark-cuban-says-hes-too-competitive-to-retire-at-age-64.html |
The recent market turbulence has investors searching for income. For some, municipal bonds may be the answer. The muni market has taken a beating this year, with net weekly inflows into muni mutual and exchange-traded funds negative for most of 2022, according to Refinitiv Lipper data. Yet their yields and tax benefits can make them an attractive investment. The debt securities are issued by government entities, such as a city or state, and raise money for public projects, such as building roads or schools. They are generally free of federal taxes on interest and may avoid state and local levies, depending on where you live. "The states are in really good shape to pay off their bonds, so it makes the safety of the munis even better than they ever have been," said certified financial planner David Sheaff Gilreath, partner and chief investment officer at Indianapolis-based Sheaff Brock Investment Advisors. Jason Ware, head of municipal bond trading at InspereX, has seen a "tremendous uptick" in buying and selling the fixed-income asset over the last two to three weeks. "Uncertainty around how high interest rates will go has driven redemptions in muni bond funds," he explained. "This was coupled with a heavier new issue calendar up until the imminent Fed decision, creating supply pressure [and] driving nominal yields and credit spreads sharply higher, making them much more attractive." The tax benefits make munis particularly attractive to high-earners in high income tax states. Those tax savings are even more critical in a time when stock returns are scarce. The market took a nosedive Friday, with the Dow setting a new low for the year . "We always like to buy municipal bonds," said CFP Ian Weinberg, CEO of Family Wealth and Pension Management in Woodbury, New York. "When rates were very low, it wasn't as exciting, but today it is a pretty good deal. Whenever we have a chance to add to muni bonds now, we do so." A good signal to buy is when municipal yields on a particular duration are at least 85% of corresponding Treasury yields , he said. That's because with a Treasury, you are paying tax on your interest earnings. Therefore, even if a highly rated muni bond of the same duration has a yield that is lower, you still may be earning more since they generally aren't being taxed. For instance, a 12-year tax-exempt California bond paying a 4% semi-annual coupon, with an essential service or general obligation type backing, can yield you a 3.7% return, said InspereX's Ware. For a high net worth individual in the highest tax bracket, that is equivalent to a 6.25% taxable yield. Meanwhile, the 10-year Treasury is currently yielding just under 3.7%. How to buy munis For investors looking to get into the muni market, there are a few ways to do so. To buy individual issues, you can use a broker-dealer, hire an investment manager, or trade directly through a self-managed online account. For instance, you can go to Fidelity Investments' website and access more than 50,000 municipal bonds as new issues or through dealers on the secondary market. However, if you choose to make your own direct purchases, be sure to do your homework, said Richard Carter, vice president of fixed income at Fidelity. "For investors considering a strategy that incorporates municipal bonds, they should first ensure they understand these offerings and how they fit into their overall financial plan," Carter said. Fidelity also offers muni bond mutual funds and exchange-traded funds, as well as municipal separately managed accounts. Both Ware and Weinberg don't advise going it alone when it comes to buying individual municipal bonds. There are so many different issuers and choices of bonds, and there are credit ratings to consider. There are also price discrepancies, with smaller investors usually at a disadvantage. "You don't want to be the bondholder who got greedy for extra yield and bought the wrong bond," Weinberg said. They suggest working with a professional who can manage the account. You can also get muni bond exposure through a mutual fund or ETF. Those who want a wide range of bond exposure, such as maturities, sectors and credit, and have limited funds could look at investing in a mutual fund or ETF, according to the Municipal Securities Rulemaking Board. Individual bonds vs. funds When buying individual municipal bonds, work with a financial advisor or bond manager and focus on good credit quality securities, like general obligation, voter approved, and essential services, suggests Ware, who is based in San Francisco. The fees will vary, with managers typically charging a percentage of the assets under management. The advantage of owning bonds over investing in a fund is that if you hold the bond to maturity, you get your principal back, he explained. You can also control your credit risk and build your own portfolio. Having a separately managed account instead of a fund also allows you to ladder munis, investing in multiple bonds with different maturities. That is a good strategy, particularly when interest rates are rising, Ware said. As rates go up, you have principal coming due that you can reinvest at the higher interest rates. There is also good tax management in the separately managed accounts, Family Wealth and Pension Management's Weinberg said. "If some bonds are in loss positions, you can have the manager use those losses for tax loss harvesting against future gains in other investments," he said. Weinberg uses an institutional municipal bond manager to handle his clients' tax-free bond portfolios. However, he believes this route is best for those investing at least a quarter of a million dollars, so that they get the right diversification. For those who may have less money to invest, a mutual fund or ETF may be a better option, he said. "There is nothing wrong with that. It just doesn't give you as much of a sense of certainty that you get from your muni bond investment," Weinberg said. Here are five Morningstar five-star rated muni bond funds. For Sheaff Gilreath, funds are exactly where he wants to be. Specifically, he said he is investing in closed-end bond funds because that's where you can buy the cheapest bonds. "Many closed-end bond funds are trading at prices that are below their net asset value," he said. He likes Putnam Managed Muni Income and Rivernorth Flexible Muni Income funds. Putnam has a 6.37% distribution yield and is currently trading at a 4.44% discount to its net asset value. Rivernorth is trading at an 11.43% discount and has an 8.26% distribution yield. Whether you strike out on your own or use a fund, financial advisor or separately managed account, make sure you do your research and understand any and all fees involved. | 2022-09-28T02:35:04Z | www.cnbc.com | Market rout has muni bonds looking good. How to add them to your portfolio | https://www.cnbc.com/2022/09/25/market-rout-has-muni-bonds-looking-good-how-to-add-them-to-your-portfolio.html | https://www.cnbc.com/2022/09/25/market-rout-has-muni-bonds-looking-good-how-to-add-them-to-your-portfolio.html |
The S & P 500 could fall to the low 3,000 range, as an earnings recession appears "unavoidable," but the market may then not stay down for long, said Mike Wilson, Morgan Stanley's chief U.S. equity strategist, who was correctly bearish going into this tough year for markets. "We're in a cyclical downturn for growth, and that's the fire-and-ice narrative to a tee, right β the tightening policy and the slowing growth," he said Monday on CNBC's " Squawk Box ." "And we're just not finished yet, in our estimation." Market observers have questioned where the "bottom" of the market will be now that the Federal Reserve appears to be willing to tolerate a recession in order to win its battle against inflation. Wilson's bear case for the S & P 500 is around 3,000, with his base case at 3,400. The strategist said he sees potential for both cases with the soft landing for earnings now less likely. These estimates represent a drop of about 8% to 18% from the S & P 500's current level. The rapid move in rates was another bad sign in the strategist's view, with the one-year Treasury bill yield surpassing 4% on Monday. Wilson said this could be an unusual moment in the market. The employment picture can create confusion about the state of the economy, as the labor shortage keeps wages up, which isn't typically seen during recessionary periods. Wilson also noted there is "so much money sloshing around" compared with other times of economic downswing, but he would not use that to make bets on where the market goes. He said efforts to curb inflation are the "medicine" to get the country out of the "debt trap" it has been trying to free itself from since the 2008 recession. The market needs time to readjust to the headwinds as the Fed attempts to control inflation through rate hikes, he said. Wilson said we are nearing a turning point and he is getting ready to spring into action once the market hits the firm's target. The S & P 500 is off 23% from its high and near its lowest levels in two years. "We're getting close to the end," he said. "The damage has been done. ... Now, we're actually starting to get ready to be more aggressive. It's just not time yet, in our view, and to be premature can be quite costly." | 2022-09-28T02:36:39Z | www.cnbc.com | A Morgan Stanley exec says the S&P could fall to the low 3,000s | https://www.cnbc.com/2022/09/26/a-morgan-stanley-exec-says-the-sp-could-fall-to-the-low-3000s.html | https://www.cnbc.com/2022/09/26/a-morgan-stanley-exec-says-the-sp-could-fall-to-the-low-3000s.html |
The best global performers last week include an energy stock analysts say could jump 15%
Published Mon, Sep 26 202212:19 AM EDT Updated Mon, Sep 26 20222:33 AM EDT
Global stocks fell in the past week, tracking losses on Wall Street as investors fled markets on the Federal Reserve's commitment to its rate hiking plan to tame inflation. The MSCI World index fell around 5%, even worse than major indexes on Wall Street. The Dow notched a new low for the year and closed below 30,000 for the first time since June 17 β 1.62% down. The S & P 500 slid 1.72%, while the Nasdaq Composite dropped 1.8%. However, there were stocks in the MSCI World index that outperformed the wider market. These were the 12 best-performing stocks in the MSCI World index that saw gains of more than 5% last week, as of the close on Sept. 23. But two stocks stood out, beating the wider losses by a mile. One is Fortum , a Finnish energy company, which says it focuses on cleaner energy production. It soared 25.6% last week. The firm earlier this month said it had secured a bridging loan with Finnish government investment company Solidium for 2.35 billion euros ($2.34 billion) to cover soaring collateral needs, according to Reuters. That development is taking place amid an energy crisis in Europe after Russia shut down the major Nord Stream 1 gas pipeline. Fortum also announced in mid-September that it was planning to add 560 megawatt capacity to the Nordic power market after October by reactivating an idle coal-fired power plant on Finland's west coast, according to Reuters. It's a favorite among majority of analysts covering the stock, with 67% rating it a buy, according to FactSet. They gave it an average target price of 16.01 euros, or an upside of around 15%. The other stock that was one of the top-performing last week is Swedish security firm Securitas , which jumped 16.3%. The world's biggest-listed security services provider earlier reported a slightly bigger-than-expected rise in second-quarter profit β boosted by demand from recovering airport security in Europe. β CNBC's Zavier Ong contributed to this report. | 2022-09-28T02:36:59Z | www.cnbc.com | Best global performers last week include an energy stock | https://www.cnbc.com/2022/09/26/best-global-performers-last-week-include-an-energy-stock.html | https://www.cnbc.com/2022/09/26/best-global-performers-last-week-include-an-energy-stock.html |
Biden said his White House Competition Council has already made huge strides in achieving competition.
President Joe Biden announced on Monday his administration's plans to crack down on fees and increase competition across various industries.
During a speech at a meeting of the White House Competition Council, the president said unnecessary hidden fees, or "junk fees," were weighing down families' budgets.
The council was created by the Biden administration to "promote competition with a goal of lowering prices for consumers and raising the wages of workers and encouraging innovation in the economy," the president said. "We made some real progress," he added.
Biden called out banks for charging overdraft fees on checking accounts, late fees for credit cards, hotel processing fees, and termination fees charged by cellphone and internet providers.
He said that three-quarters of America's 20 largest banks were getting rid of fees β which averaged $50 β for bounced checks due to the council's efforts. The changes will put the government on track to lowering overdraft fees by $3 billion a year, Biden said.
Agriculture Secretary Tom Vilsack, who is a member of the Competition Council, said Monday that the USDA "is focused on building new, fairer, and more resilient markets, protecting producers, and reducing food costs, and we are proving again today that we will use all tools at our disposal to do so."
The Federal Communications Commission is also mandating cellphone and internet companies present fees to consumers at the time of purchase. The Department of Transportation announced new rules to require airlines and search websites to disclose hidden fees upfront, the president said.
"When companies have to compete β it's a simple proposition. When they have to compete, they sell β they make better products and β guess what? β the price goes down. It doesn't go up when there's competition," he said. | 2022-09-28T02:37:06Z | www.cnbc.com | Biden introduces administration's plans to increase competition across industries | https://www.cnbc.com/2022/09/26/biden-introduces-administrations-plans-to-increase-competition-across-industries.html | https://www.cnbc.com/2022/09/26/biden-introduces-administrations-plans-to-increase-competition-across-industries.html |
Biden administration proposes transparency with airline fees
President Joe Biden on Monday announced new rules that would require airlines and online travel agencies to disclose fees for seat selection, checked baggage and other add-ons along with fares, the administration's latest effort to bolster passenger protections after a rocky summer travel season.
The president outlined the Transportation Department's new proposed rules during a speech at a meeting at the White House Competition Council on Monday.
Travelers at LaGuardia Airport (LGA) in the Queens borough of New York, US, on Friday, July 2, 2022. As travel is ramping up for the July 4th holiday, staffing shortages are causing problems for some of the nations largest airlines.
Transportation Secretary Pete Buttigieg said in a news release earlier on Monday that the proposed rule "would require airlines to be transparent with customers about the fees they charge, which will help travelers make informed decisions and save money."
"A4A member passenger airlines β which are fierce competitorsβ already offer transparency to consumers from first search to touchdown," the group said in a statement. "U.S. airlines are committed to providing the highest quality of service, which includes clarity regarding prices, fees and ticket terms." | 2022-09-28T02:37:18Z | www.cnbc.com | Biden administration seeks new rules on airline fee disclosures | https://www.cnbc.com/2022/09/26/biden-seeks-stricter-rules-requiring-more-transparency-of-airline-fees.html | https://www.cnbc.com/2022/09/26/biden-seeks-stricter-rules-requiring-more-transparency-of-airline-fees.html |
The Bank of England hiked interest rates by 50 basis points. This is seen as conservative, but the market understands the Bank's "wait and see" attitude ahead of the new government's fiscal measures.
Since interest rates in the UK are not rising as fast as in the US, the main task of preventing a recession falls on the UK fiscal policy. With the Truss government's focus on capping energy prices and cutting taxes sharply to preserve economic growth, analysis suggests that there is growing tension between the UK's expansionary fiscal policy and the monetary policy that should be adopted, given that the level of inflation in the UK is currently five times higher than the 2% target inflation.
The pound has fallen sharply against the dollar so far this year. And if the U.S. and other European countries continue to aggressively raise interest rates in the coming months, the Bank of England can not follow suit in tandem, then the market expects the pound will continue to sink.
And if the energy crisis deepens this winter and the government's fiscal pressures become too great, some analysts predict that there is a risk of parity between the pound and the dollar, or even parity with the euro.
Truss government in the fight against inflation of the new policy it takes some time to work
On the other hand, from the perspective of people's livelihood, the Truss government's new policy in the fight against inflation will take some time to work, following the previous university teachers, railroad workers, and Royal Mail employees repeatedly strike for a pay rise, many other industries have recently announced new strike dates.
40,000 railroad workers will strike on October 8, and 2,000 bus drivers in north London will strike on October 4. In addition, nurses, doctors, and teachers are also preparing to strike to address pay issues. But Kirkegaard, a senior fellow at the Peterson Institute for International Economics, feels that the new deal may solve labor risks in the short term, but in the long term, it could lead to a loss of investor confidence.
Jacob Kirkegaard
Senior Fellow of Peterson Institute for International Economics (PIIE), a U.S. think tank
"I'm more see the risks are in a slightly longer time horizon, that markets simply lose faith in the ability of the UK government to continue to serve as these very large outlays and that is going to give you if you like, a run on the pound, I think that's the real risk and that's the gamble that's being taken."
Looking at the whole of Europe from the UK, countries are actually facing inflationary pressures from the energy crisis and US interest rate hikes. This chart shows the CPI trend of some European countries, you can see that since 2022 are rising sharply.
To fight inflation, several European central banks have raised interest rates this week, the most notable of which is the Swiss central bank, which raised interest rates by 75 basis points, ending a negative interest rate policy that has lasted for eight years. This also means the era of negative interest rates in Europe is set to end. | 2022-09-28T02:37:37Z | www.cnbc.com | CCTV Script 23/09/22 | https://www.cnbc.com/2022/09/26/cctv-script-23/09/22.html | https://www.cnbc.com/2022/09/26/cctv-script-23/09/22.html |
Apple's announcement shows that as early as October 5, 2022, prices of apps and in-app purchases (excluding auto-renewable subscriptions) on the App Store will increase. The price increase involves 28 countries and regions around the world from Europe to Asia, including all countries using the euro, as well as Sweden, Japan, South Korea, Chile, Egypt, Malaysia, and so on. This means that consumers in these regions will pay more than before to purchase or subscribe in-App on Apple's App Store.
According to the report published by Apptopia, Apple's app store has actually increased its prices a lot since last July. As of July 2022, the average price of Apple's in-app purchases rose by about 40% year over year, while the price of Google Store in-app purchases rose by only 9% during the same period.
In terms of the reasons behind this price increase, Apple officially did not give a detailed explanation, but many analysts believe that there are two main reasons. One is the strength of the dollar, Apple used price increases to offset the weakness of the local currency against the dollar. Second, Apple's revenue structure is shifting from hardware to software.
So far this year, as the Federal Reserve continues to raise interest rates, the U.S. dollar index has risen by more than 18% cumulatively from the beginning of the year, reaching a nearly 20-year high.
At the same time, since more than half of Apple's revenue comes from markets outside the Americas, this means that the strong dollar is doing more harm than good to Apple's earnings. Almost all of the countries and regions we see this price increase in are areas where local currencies have depreciated significantly, such as the euro and the yen. Recently, the euro has continued to sink against the dollar, falling to a 20-year low and already close to parity. By raising prices, Apple has also shifted the pressure of exchange rate changes to consumers.
Some analysts believe that the price increase will definitely affect app developers and game developers. Consumers may be more cautious when buying apps, and developers will have to become more creative in their pricing.
In the face of the Fed's interest rate hike and the uncertain global economic outlook, virtually the entire technology industry is facing considerable pressure. In an earlier media interview, Apple CEO Tim Cook said that the company is expected to slow down hiring next year, while reducing some team budgets. In addition, for example, Twitter, Microsoft, META, and others, all announced layoffs this year. Tech stocks as a whole have also plummeted. | 2022-09-28T02:37:45Z | www.cnbc.com | CCTV Script 26/09/22 | https://www.cnbc.com/2022/09/26/cctv-script-26/09/22.html | https://www.cnbc.com/2022/09/26/cctv-script-26/09/22.html |
β This is the script of CNBC's weekly report for China's CCTV on September 23, 2022.
For this week's weekly report, let's first take a look at Jeff Bezos, founder and chief executive officer of Amazon.com. According to Bloomberg's Billionaire Index, Bezos has fallen from the world's second richest person to the third position. Bezos was overtaken by Tesla founder Musk in 2021 and lost his throne as the world's richest person, and this time Gautam Adani, the Indian tycoon surpassed Jeff Bezos. How did Bezos' fortune shrink?
The Federal Reserve started the interest rate hike cycle in March this year, and the tech-heavy Nasdaq has been hit especially hard this year. Amazon's share price has fallen about 30% since the beginning of the year. This wave of tech sell-offs has also shrunk Bezos' fortune by more than $45 billion since January.
Meanwhile, Adani has seen his fortune grow rapidly. One of his Adani Group's core businesses is coal, and coal prices have soared this year. At the same time, his group continues to expand into areas such as telecommunications, electronic services, airport operations, etc. Adani Group's shares have more than doubled this year, which has made his wealth ranking from 14 at the beginning of the year to second place today.
Next, let's focus on the Governor of the Bank of Japan, Haruhiko Kuroda. This week, the Bank of Japan decided to keep interest rates unchanged and keep ultraloose policy. With the Swiss central bank has ended its negative rate policy, the BOJ is set to be the only major central bank with a negative benchmark rate.
The 77-year-old may not wait until his term expires on April 8 next year, but will step down on March 19 next year, along with two other deputy governors. What are the effects of Japan's ultraloose monetary policy on its citizens? We can take a look at the price of an Apple phone.
As the yen continues to depreciate against the dollar, Apple has had to raise prices across the board for the Japanese market, so it will cost more for Japanese people to buy an Apple phone. The lowest-priced model of iPhone 13, for example, was previously priced at 98,800,000 yen (about RMB 4,901 RMB) with tax, but now it has been raised to 117,800 yen (about RMB 5,844 RMB), a price increase of 19,000 yen, which is almost 20% more expensive.
Finally, let's focus on a company executive, Doug Ramsey. Ramsey, 53, is the chief operating officer of Beyond Meat. He got into a confrontation with a man in an Arkansas parking lot, biting him on the nose and threatening his life. Ramsey was charged with terroristic threatening and third-degree battery and booked in the Washington County jail Upon the news, Beyond Meat stock dropped sharply, hitting a new all-time low. Ramsey has now been suspended from the company.
In fact, as regard to the whole plant-based meat sector, its sales growth stagnates this year.The reason is that the retail price of their products is usually higher than that of real meat, but the high price is not due to the rising cost of ingredients. It is because of the high marketing expenses. This has led to increasingly difficult times for the plant-based meat industry in the current environment of high inflation and cosumers tightening their purse strings. This year Beyond Meat's share price has fallen about 76%. | 2022-09-28T02:37:51Z | www.cnbc.com | CCTV Script Weekly 23/09/22 | https://www.cnbc.com/2022/09/26/cctv-script-weekly-23/09/22.html | https://www.cnbc.com/2022/09/26/cctv-script-weekly-23/09/22.html |
Published Sun, Sep 25 20229:02 PM EDT Updated Mon, Sep 26 20228:38 PM EDT
Hedge fund manager Dan Niles has revealed his outlook for the S & P 500 after the Federal Reserve hiked rates by 75 basis points for the third consecutive time. The founder of The Satori Fund said he expects the index to drop by 30% to 50% from its most recent peak by the end of next year. The S & P 500 hit an all-time high of 4,797 in January this year and has fallen by more than 20% since then. "Our single point target is 3,000 on the S & P," he said, echoing Morgan Stanley Chief Investment Officer Mike Wilson's call earlier this year. Niles, who's also a senior portfolio manager at his hedge fund, said he expects earnings per share for the large-cap equities index to fall to $200 by mid-to-late 2023. He's also expecting the price-to-earnings ratio to fall to 15 times forward earnings. The most recent survey of analysts by S & P shows EPS is expected to be at $239.03 for 2023, with a PE multiple of 16.13. The long-short equity fund manager said stocks are likely to decline further than the market expects as the Federal Reserve continues to tighten financial conditions, unlike in the past. "The problem is everybody has been conditioned over the last 13 years that every time the stock market goes down, the Fed then reverses itself," he said. "So that's what you should be worried about, which is the Fed is going to have to leave rates at a higher level for longer to solve this problem." Niles also warned that bear market rallies are also likely to occur as the S & P 500 falls to 3,600. "It wouldn't surprise me to see another one," he added. How will bonds respond? Rising interest rates are also likely to push bond yields higher (and, consequently, their prices lower). When asked whether he saw the 2-year Treasury yield rising to 5.5%, Dan Niles responded emphatically: "absolutely." He even suggested that a scenario where yields were above inflation was possible in the coming months. The 2-year Treasury yield was trading around 4.26% Friday, while the 10-year was around 3.695%. U.S. inflation rose more than expected in August , rising 8.3% from a year earlier. On his fund's performance, Niles said: "We're up for the year, but it's not because of our longs. It's because of our shorts." Shorting is a strategy which sees investors bet that the price of a stock will fall. Niles said the drop in the stock market earlier this year was due to forward earnings being downgraded ; he expects the next drop to be driven by a fall in company revenues. The hedge fund manager had a stark, yet straightforward, message for investors: "There is nothing that is safe. Stay in cash." | 2022-09-28T02:37:58Z | www.cnbc.com | Dan Niles predicts when the S&P 500 might bottom, and reveals how he's profited | https://www.cnbc.com/2022/09/26/dan-niles-predicts-when-the-sp-500-might-bottom-and-reveals-how-hes-profited.html | https://www.cnbc.com/2022/09/26/dan-niles-predicts-when-the-sp-500-might-bottom-and-reveals-how-hes-profited.html |
Eight states announced individual cease-and-desist orders against the crypto-lending platform Nexo.
New York State Attorney General Letitia James speaks at a news conference after former U.S. President Donald Trump's White House chief strategist Steve Bannon arrived to surrender, in New York, U.S., September 8, 2022.
Eight states announced on Monday they're bringing actions against the crypto-lending platform Nexo Group in connection with its unregistered, interest-bearing cryptocurrency product.
Nick WellsFred Imbert
The filings also alleged that Nexo misrepresented the accounts and suggested to investors that it is a licensed and registered platform. These interest-earning accounts, known as "Earn Interest Product," allowed investors to deposit assets with Nexo in exchange for earning yields as high as 36% on their deposits, according to one of the filings.
In response to more than 10,000 of its residents being affected, New York's Attorney General Letitia James filed a lawsuit against the cryptocurrency platform.
"Cryptocurrency platforms are not exceptional; they must register to operate just like other investment platforms," James said in a statement. "Nexo violated the law and investors' trust by falsely claiming that it is a licensed and registered platform. Nexo must stop its unlawful operations and take necessary action to protect its investors."
"We have been working with U.S. federal and state regulators and understand their urge, given the current market turmoil and bankruptcies of companies offering similar products, to fulfill their mandates of investor protection by examining past behavior of providers of earn interest products," the company said in a statement.
"As the recent months have clearly underlined, Nexo is a very different provider of earn interest products, as showcased by the fact that it did not engage in uncollateralized loans, had no exposure to LUNA/UST, did not have to be bailed out, or needed to resort to any withdrawal restrictions." | 2022-09-28T02:38:04Z | www.cnbc.com | Eight states file action against Nexo crypto-lending platform | https://www.cnbc.com/2022/09/26/eight-states-file-action-against-nexo-crypto-lending-platform.html | https://www.cnbc.com/2022/09/26/eight-states-file-action-against-nexo-crypto-lending-platform.html |
Investors are paying the paying the price for the Federal Reserve's policy mistakes, according to Allianz economic advisor Mohamed El-Erian. "This is a two-part policy mistake of historical proportions," the former CEO of bond giant Pimco told CNBC's " Squawk Box " in a Monday interview. "Part No. 1 was being seduced by 'transitory' and doing nothing," he added, referring to the term Fed officials used to describe inflation through much of 2021. "Even in March, they were still buying bonds, just to tell you the magnitude of how far behind they fell. And now in the scramble to catch up, they are hiking aggressively into a strong economy, which will be phase two of the policy mistake." El-Erian spoke less than a week after the rate-setting Federal Open Market Committee approved its third consecutive 0.75 percentage point interest rate increase. The cumulative 3 percentage points in hikes his year represents the fastest pace of tightening since the Fed began using the overnight funds rate as its primary policy tool in 1990. In addition to raising rates, the Fed is paring up to $95 billion a month in bond holdings from its $8.9 trillion balance sheet. The central bank is unlikely to veer from the present course, El-Erian said. "The trouble is, the alternative is not something that will appeal to them," he said. "So we are going to have to navigate through this historical Fed policy mistake." There is one bright side to the analysis: The process will help wash out distortions in financial markets that also were the product of Fed policies in the other direction. At the onset of the Covid pandemic , the central bank slashed benchmark borrowing rates to near-zero and instituted a series of unprecedented liquidity and lending measures that helped stave off the initial crisis but that also one day would have to be unwound. "We were in a very artificial market [with] highly distorted asset allocations. There was no meaningful risk mitigators, and people were pushed to do silly things, and we are unwinding this," El-Erian said. "For long-term investors, we are going to get to a better destination. The journey, though, is incredibly bumpy and getting even more bumpy with what is happening around the world." | 2022-09-28T02:38:10Z | www.cnbc.com | El-Erian says the Fed has made a 'policy mistake of historical proportions' | https://www.cnbc.com/2022/09/26/el-erian-says-the-fed-has-made-a-policy-mistake-of-historical-proportions.html | https://www.cnbc.com/2022/09/26/el-erian-says-the-fed-has-made-a-policy-mistake-of-historical-proportions.html |
Meta's new features are intended to help people more easily manage their Facebook and Instagram accounts.
The move underscores Meta's attempt to consolidate its family of apps so they aren't so distinct from one another.
The company debuted Meta accounts in July that allows people access to its virtual reality headsets without having to use their Facebook accounts.
In this photo illustration, a silhouetted woman holds a smartphone with the Meta Platforms, Inc. logo displayed on the screen.
Meta said Monday it's testing new features intended to help people easily manage their Facebook and Instagram accounts through one interface.
Meta also modified its user-registration process so it's easier to log in and create new Facebook and Instagram accounts. This could help new users create accounts on both services as opposed to just one of the apps, which is seen as a way to court more users.
Meta said the new account management features are "currently limited to Facebook and Instagram," but that the company will "continue to explore how to improve connected experiences across all of our technologies."
Meta shares fall to lowest level since March 2020 on cost-cutting plan | 2022-09-28T02:38:29Z | www.cnbc.com | Facebook and Instagram users can now easily switch between accounts | https://www.cnbc.com/2022/09/26/facebook-and-instagram-users-can-now-easily-switch-between-accounts.html | https://www.cnbc.com/2022/09/26/facebook-and-instagram-users-can-now-easily-switch-between-accounts.html |
Feds commit $50 million to for-profit nuclear fusion companies, chasing the 'holy grail' of clean energy
The Department of Energy officially announced that $50 million will go toward private nuclear fusion companies in public-private partnerships.
The U.S. government has put federal money into fusion science research since the 1950s and today invests about $700 million per year into fusion research, Andrew Holland, the CEO of the fusion industry trade group, told CNBC.
This is the first time substantial amounts of money have gone to for-profit companies.
A picture shows the winding facility for the construction of poloidal field coils which will be part of the magnetic system that will contribute to confine and model plasma during the launch of the assembly stage of nuclear fusion machine "Tokamak" of the International Thermonuclear Experimental Reactor (ITER) in Saint-Paul-les-Durance, southeastern France, on July 28, 2020. - Thirty-five nations are collaborating in the ITER energy project aimed at mastering energy production from hydrogen fusion, as in the heart of the sun, a potential new source of carbon-free and non-polluting energy.
The United States government is putting a sizable amount of money behind private sector nuclear fusion companies for the first time in the latest sign of how momentum is building behind the "holy grail" of clean energy.
At the Global Clean Energy Action Forum in Pittsburgh on Thursday, the Department of Energy officially announced $50 million will go toward private fusion companies in public-private partnerships.
"This money signifies that the U.S. government is getting serious about building a fusion program that will have commercial significance on an accelerated timeframe," Andrew Holland, the CEO of the Fusion Industry Association, an industry trade group, told CNBC.
Conventional nuclear reactors are based on nuclear fission, a process in which a neutron slams into a large atom and splits it, releasing energy. Nuclear fusion occurs when two heavier atoms slam together to form a heavier atom β the way stars are powered. It is often seen as the holy grail of clean energy, because it offers virtually unlimited energy, releases no greenhouse gasses and generates no long-lasting nuclear waste. But it's proven very difficult to duplicate the process safely in a way that can be scaled and commercialized.
The U.S. government has put federal money into fusion research since the 1950s and today invests about $700 million per year. Holland told CNBC. But that money has mostly gone toward national labs and universities and toward the primary international research project in France, ITER.
But the $50 million announced in Pittsburgh for private fusion companies "is the first substantial investment by the U.S. government into private sector fusion-energy companies," Holland told CNBC.
The $50 million will help companies prepare detailed plans, but isn't sufficient funding to construct expensive fusion power plants. Nevertheless, it will help bolster and give U.S fusion companies credibility.
"This is critical since fusion power is such an audacious but vital technology for the United States and our collective fight against climate change. We want a U.S. firm to be the first to reach net power," Matthew Moynihan, a nuclear fusion consultant, told CNBC.
"Net power" refers to a key threshold in the fusion industry whereby more power is generated than it takes to catalyze the reaction. "This is also more than just a paycheck: Winning this funding will give firms the government's stamp of approval, something investors will want to see as they consider adding more money to the industry," Moynihan told CNBC.
The private sector fusion industry has attracted almost $5 billion in venture capital and other funding, according to the Fusion Industry Association.
Notable recent raises include $1.8 billion in funding from Commonwealth Fusion Systems, a spinoff from Massachusetts Institute of Technology research, from a slew of heavy-hitting investors including Bill Gates, John Doerr, Salesforce co-CEO Marc Benioff's Time Ventures, and Google. Another private fusion company, Helion, announced a $500 million raise led by Silicon Valley insider Sam Altman and which includes the potential for another $1.7 billion in funding depending on Helion meeting particular funding goals.
While the program is currently funded at $50 million over the next 18 months, Congress has authorized spending as much as $415 million in future budgets. The public-private funding program was first authorized in the Energy Act of 2020.
The race to nuclear fusion power
Powering the Future | 2022-09-28T02:38:35Z | www.cnbc.com | Feds commit $50 million to for-profit nuclear fusion companies | https://www.cnbc.com/2022/09/26/feds-commit-50-million-to-for-profit-nuclear-fusion-companies.html | https://www.cnbc.com/2022/09/26/feds-commit-50-million-to-for-profit-nuclear-fusion-companies.html |
Goldman's playbook on what to buy and sell with the U.S. dollar surging
The surging U.S. dollar is the new big worry in the markets, adding to the pain from central bank rate hikes that have sent the S & P 500 back to near its lows for the year. But there is a way to play the booming greenback. The British pound hit a record low against the dollar on Monday and the euro reached the lowest since 2002. The U.S. Dollar Index , which measures it against a basket of currencies, is up 9% the last three months and 18% this year, sizable moves in the currency markets. A strong dollar generally is not necessarily bad for U.S. companies and the market. However, when you have a rapid strengthening like we are seeing now, it can wreak havoc on financial markets and some companies' bottom lines. How to trade it Goldman Sachs has two portfolios that it gives to clients on how to protect and profit from the strong U.S. dollar, which can crimp profits of multinationals by making their products more expensive for overseas buyers. What to buy For those looking for a long trade, Goldman gives clients the U.S. stocks that have all domestic sales so they are not subject to the same currency exposure as multinationals. Shares of these companies could see increased demand from investors as they look to shelter in domestic players not subject to any currency risk. Here are some of the stocks in the Goldman basket: Notable names on this list include Chipotle , CVS Health and Dollar General . What to sell On the flip side, there are certain names investors should avoid or for the nimble traders, bet against in this environment. Goldman has a basket of companies that get a large majority of their sales from outside the U.S., making them vulnerable to the latest surge in the greenback. Here are some of the names in that basket. Some surprising companies on this list include Netflix , Alphabet and Booking Holdings . To be sure, if the dollar's run was to turn dramatically, then these stocks could be among the first to bounce. However, even if that occurs they could still be at risk over the longer term as there is a lag effect on the dollar's impact on their earnings. With the greenback up so much already this year, their earnings estimates could still be at risk even if the dollar's run slows a bit. β With reporting by CNBC's Michael Bloom. | 2022-09-28T02:38:41Z | www.cnbc.com | Goldman's playbook on what to buy and sell with the U.S. dollar surging | https://www.cnbc.com/2022/09/26/goldmans-playbook-on-what-to-buy-and-sell-with-the-us-dollar-surging.html | https://www.cnbc.com/2022/09/26/goldmans-playbook-on-what-to-buy-and-sell-with-the-us-dollar-surging.html |
The U.S. dollar's strength is setting the stage for a crisis, as well as a looming bottom in the stock market, according to Morgan Stanley. With the greenback hitting 20-year highs against its foreign competitors, equity markets that have relied on cheap currency have tumbled. Fears are rising that the moves in the dollar will pressure corporate earnings, and "such US dollar strength has historically led to some kind of financial/economic crisis," Morgan Stanley equity strategist Michael Wilson and others said in a client note. A weak dollar makes U.S. goods and services less expensive in global trade, which is inflationary and not desirable while prices are around their highest levels in more than 40 years as they are now. Conversely, a strong dollar makes imports cheaper, which is not only disinflationary but also puts pressure on profits and raises questions about how much the economy can sustain until something goes wrong. The dollar's rise on Monday sent major stock market averages tumbling and brought on a fresh round of second-guessing regarding monetary policy from the Federal Reserve and its global counterparts. "What's amazing is that this dollar strength is happening even as other major central banks are also tightening monetary policy at a historically hawkish pace," Wilson wrote. "If there was ever a time to be on the lookout for something to break, this would be it." If there's a bright side, the dangers are pushing the stock market toward a bottoming process. Morgan Stanley estimates the S & P 500 will need to get in a range between 3,000 and 3,400, however, for the floor to hit and set the stage for a turnaround. The high end of that range translates to an 8% decline from Friday's close; the low end would mean a roughly 19% plunge. "The recent move in the US dollar creates an untenable situation for risk assets that historically has ended in a financial or economic crisis, or both," Wilson wrote. "While hard to predict such 'events,' the conditions are in place for one, which would help accelerate the end to this bear market." 'Exactly how' something breaks The Fed has raised rates a total of 3 percentage points this year, while dozens of other central banks around the world also have been tightening. However, in the UK, authorities actually have loosened fiscal policy, implementing a tax cut at a time when when inflation is running close to 10% on an annual basis. Morgan Stanley's currency team is expecting the dollar index , which measures the U.S. currency against a basket of its global counterparts, to continue to rise even though it's at its highest level since 2002. The firm forecasts the index to hit 118 by year end, up from the 114 level where it was trading Monday afternoon, indicating "no relief in sight, at least fundamentally speaking." "In our view, such an outcome is exactly how something does break, which leads to MAJOR top for the US dollar and maybe rates, too," Wilson wrote. "However, until that happens, we think the screws will only get tighter for earnings growth and financial conditions." The currency trends have ignited criticism for the Fed, which spent much of 2021 dismissing inflation as "transitory" as it continued to keep interest rates low and expand its balance sheet to about $9 trillion. Speaking on CNBC, Allianz chief economic advisor Mohamed El-Erian said the Fed had made policy mistakes "of historical proportions." Wharton professor Jeremy Siegel demanded that Fed Chairman Jerome Powell apologize to the American people "for such poor monetary policy that he has pursued, and the Fed has pursued, over the past few years." | 2022-09-28T02:39:18Z | www.cnbc.com | Morgan Stanley sees dollar surge setting the stage for 'something to break' | https://www.cnbc.com/2022/09/26/morgan-stanley-sees-dollar-surge-setting-the-stage-for-something-to-break.html | https://www.cnbc.com/2022/09/26/morgan-stanley-sees-dollar-surge-setting-the-stage-for-something-to-break.html |
Peloton's head of marketing, Dara Treseder, is leaving the company.
Peloton's head of marketing is leaving the company, just weeks after a broader executive shake-up at the exercise equipment maker.
Dara Treseder, whose last day will be Oct. 4, is leaving for a position at Autodesk. At Peloton, she oversaw marketing and membership, reporting to CEO Barry McCarthy after the departure of Kevin Cornils, the company's chief commercial officer. The announcement comes after co-founder and former CEO John Foley left his board chair position earlier this month.
Since taking over as chief executive in February, McCarthy has been working to revive the company's struggling business and increase cash flow by growing subscription revenue. After thriving during the early days of the coronavirus pandemic as gyms shut down, Peloton's losses have been mounting as it works to expand its customer base and win back the confidence of investors.
As senior vice president of marketing, communications and membership, Treseder oversaw Peloton's introduction of a $3,195 rowing machine last week and a nationwide bike rental program earlier in September. She also supervised Peloton's expansion to Australia and its partnerships with Beyonce and Usain Bolt.
Treseder, who previously led marketing teams at Apple and Goldman Sachs, will be taking on the role of chief marketing officer at Autodesk. Peloton said it will look to fill the newly created role of chief marketing officer.
Correction: Dara Treseder is senior vice president of marketing, communications and membership at Peloton. An earlier version misstated her title. | 2022-09-28T02:39:44Z | www.cnbc.com | Peloton's head of marketing latest executive to leave company | https://www.cnbc.com/2022/09/26/pelotons-chief-marketing-officer-latest-executive-to-leave-company.html | https://www.cnbc.com/2022/09/26/pelotons-chief-marketing-officer-latest-executive-to-leave-company.html |
This was CNBC's live blog tracking developments on the war in Ukraine on Sept.26, 2022. See here for the latest updates.
U.S. warns of Putin against using nuclear weapons as Russians flee to avoid reservist call up
The Kremlin later said it is in "sporadic" contact with Washington over nuclear issues.
Anti-mobilization protests appear to be continuing, with reports of standoffs with authorities and several arrests in Russia's North Caucasus region of Dagestan. A gunman in eastern Siberia was detained for opening fire in a military draft office.
Meanwhile, Russian-led referendums in the occupied areas of Ukraine are in their fourth day, and Ukrainian officials as well as people inside the territories say that some people are being made to vote at gunpoint, and that Russian forces are staging votes.
Western and Ukrainian officials condemn the referendums as a sham they say will allow Putin to annex the territories, and then use them to justify deploying nuclear weapons to protect them. Moscow says the referendums are legitimate.
U.S. Joint Chiefs Chair Milley speaks with his Ukrainian counterpart to reaffirm U.S. commitment
US Army General Mark Milley, Chairman of the Joint Chiefs of Staff, holds a press briefing about the US military drawdown in Afghanistan, at the Pentagon in Washington, DC September 1, 2021.
U.S. Chairman of the Joint Chiefs of Staff Gen. Mark Milley spoke with his Ukrainian counterpart by phone, according to a Pentagon readout of the call.
"They discussed the unprovoked and ongoing Russian invasion of Ukraine and exchanged perspectives and assessments. The Chairman reaffirmed unwavering support for Ukraine's sovereignty and territorial integrity," Joint Staff spokesman Col. Dave Butler wrote in a statement on Milley's call with Ukrainian Armed Forces Gen. Valery Zaluzhny.
Four vessels to depart Ukraine carrying 72,043 metric tons of agricultural products
The Joint Coordination Center, an initiative of Ukraine, Russia, the United Nations and Turkey, said that the vessels are carrying a total of 72,043 metric tons of grain and other food products.
Two ships from Odesa are destined for Turkey and are carrying corn and sunflower oil. Another ship will depart from Ukraine's Yuzhny-Pivdennyi port for the Netherlands and is carrying corn. The fourth vessel will sail from Odesa to Spain and is carrying sunflower oil.
Russian President Vladimir Putin granted citizenship to former U.S. intelligence contractor Edward Snowden.
Snowden's name appears as one of approximately 70 foreign nationals listed in a decree and approved by Putin for Russian citizenship.
The former NSA intelligence officer turned U.S. government whistleblower fled to Hong Kong and later to Russia in to evade federal prosecution after leaking classified documents to journalists. He was granted asylum in Russia in 2013 and later permanent residency. Snowden, 39, has remained in Russia ever since.
Putin's decision to grant Snowden citizenship comes just days after ordering approximately 300,000 people to join the fight in Ukraine.
Prime Minister Mark Rutte, pictured here attending a press conference on March 23 2020, argued that there is a "limit to what a government can do" to help with inflation.
Dutch Prime Minister Mark Rutte said that his country will increase its support to Ukraine while also backing new sanctions against Russia.
"More weapons, more sanctions, more isolation of Russia," Rutte wrote on Twitter.
"Because of Russia's mobilization and mock referendums. Protecting Europe is crucial to our security," he added.
Rutte also said that he spoke to Ukrainian President Volodymyr Zelenskyy about the additional support the Netherlands is expected to provide.
More than 7.4 million Ukrainians have become refugees from Russia's war
Children who fled the war in Ukraine rests inside a temporary refugee shelter that was an abandoned TESCO supermarket after being transported from the Polish Ukrainian border on March 08, 2022 in Przemysl, Poland.
Omar Marques | Getty Images
More than 4.1 million of those people have applied for temporary resident status in neighboring Western countries, according to data collected by the agency.
Blinken announces more than $450 million for Ukrainian law enforcement and criminal justice programs
U.S. Secretary of State Antony Blinken announced an additional $457.5 million aimed at supporting Ukrainian law enforcement and criminal justice agencies.
"In addition to expanding our direct assistance to Ukrainian law enforcement, a portion of this new assistance will also continue U.S. support for the Ukrainian government's efforts to document, investigate, and prosecute atrocities perpetrated by Russia's forces, drawing on our long-standing relationship with Ukrainian criminal justice agencies, including the Ukrainian Office of the Prosecutor General and the NPU's war crimes unit," Blinken wrote in a statement.
The $457.5 million brings U.S. commitment to more than $645 million since December.
Orthodox Jews flock to Ukraine for Jewish New Year despite warnings
Thousands of Orthodox Jewish pilgrims traveled to Ukraine to celebrate Rosh Hashanah, the Jewish New Year, despite safety warnings not to do so from both Israeli and Ukrainian governments.
The pilgrims descended upon the town of Uman in central Ukraine where a highly respected rabbi, Nachman of Breslov, was buried in 1810. Hasidic Jews have been making the annual pilgrimage since 1991, when the collapse of the Soviet Union and Ukraine's subsequent independence made the religious celebration more accessible to foreigners.
Orthodox Jewish pilgrims on the street near the tomb of Rabbi Nachman while celebrating Rosh Hashanah, the Jewish New Year, amid Russia continues the war in Ukraine. Uman, Ukraine, September 25, 2022.
Orthodox Jewish pilgrims celebrate near the tomb of Rabbi Nachman while celebrating Rosh Hashanah, the Jewish New Year, amid Russia continues the war in Ukraine. Uman, Ukraine, September 25, 2022
Maxym Marusenko/ | Nurphoto | Getty Images
Orthodox Jewish pilgrims pray near the tomb of Rabbi Nachman while celebrating Rosh Hashanah, the Jewish New Year, amid Russia continues the war in Ukraine. Uman, Ukraine, September 25, 2022.
Orthodox Jewish pilgrims celebrate near the tomb of Rabbi Nachman while celebrating Rosh Hashanah, the Jewish New Year, amid Russia continues the war in Ukraine. Uman, Ukraine, September 25, 2022.
β Natasha Turak, Getty Images, Reuters
Russian stocks sink to February lows
Markets in Moscow have been in general decline since President Vladimir Putin announced a partial military mobilization last week, setting the Russian economy on a war footing and likely prolonging the conflict in Ukraine.
Gunman detained after shooting military draft officer in Siberia
A gunman has been detained after opening fire at a Russian military draft office in the Siberian town of Ust-Ilimsk.
A man who identified himself to police as 25-year-old Ruslan Zinin shot the manager of the draft office at point-blank range, Reuters reported, citing videos of the event published on social media. Reuters and CNBC were not able to independently verify the videos.
The head of the draft office was taken to the hospital and is in critical condition, Irkutsk regional governor Igor Kobzev wrote on the Telegram, adding that the shooter "will absolutely be punished."
Reuters also reported a man attempting to set himself on fire at a bus station in Ryazan, a city south of Moscow, "shouting that he did not want to fight in Ukraine," the wire service wrote. He was picked up by an ambulance.
Acts of protest against the Kremlin's order for "partial mobilization" have been recorded in numerous parts of Russia, with at least 2,000 protesters arrested and long lines of cars forming at borders of Russian men trying to leave the country. Draftees are being overwhelmingly taken from Russia's poorer and more remote areas like Yakutia, in eastern Siberia, and Dagestan, in the Caucuses. | 2022-09-28T02:39:57Z | www.cnbc.com | Russia-Ukraine war updates for Sept. 26, 2022 | https://www.cnbc.com/2022/09/26/russia-ukraine-live-updates.html | https://www.cnbc.com/2022/09/26/russia-ukraine-live-updates.html |
Southwest said it has another 7,000 flight attendant candidates in its hiring pipeline.
Passengers deplane from a Southwest Airlines flight from Las Vegas at Hollywood Burbank Airport in Burbank, California, Oct. 10, 2021. Southwest Airlines canceled more than 1,000 flights Sunday, as part of a major weekend service disruption that the carrier attributed to bad weather, air traffic control and its own shortage of available staff.
Southwest and other airlines are still racing to hire and train staff to cater to a rebound in travel demand, which executives expect to hold up this fall, led by strong leisure bookings.
Airlines were prohibited from laying off staff during the Covid pandemic under the terms of a $54 billion federal bailout but were allowed to offer employees extended leaves of absence or early retirement.
Southwest said it currently has more than 62,000 full-time equivalent employees. That's more than the 60,800 it had at the end of 2019, before the pandemic.
The carrier told staff that it has 7,000 flight attendant candidates in its hiring pipeline and that its attrition rate among new cabin crew members has dropped to 2.5% compared with 6.1% in 2019.
Separately on Monday, Southwest announced it was promoting its chief commercial officer, Andrew Watterson, to replace COO Mike Van de Ven, who will become an "executive advisor" for the airline in 2023. | 2022-09-28T02:40:03Z | www.cnbc.com | Southwest Airlines hired a record 3,000 flight attendants so far this year | https://www.cnbc.com/2022/09/26/southwest-airlines-hired-a-record-3000-flight-attendants-so-far-this-year.html | https://www.cnbc.com/2022/09/26/southwest-airlines-hired-a-record-3000-flight-attendants-so-far-this-year.html |
Year-end rally hopes are starting to get dashed. What history tells us about what comes next
Investors are holding their breath as the Dow Jones Industrial Average and the S & P 500 head toward a retest of their 2022 lows this week, the final week of trading for September. September falls in the middle of a seasonally weak period for stocks. By contrast, November and December are typically strong months but β with the market off so much already year to date β the chances of a year-end rally now look less likely, according to Ned Davis Research. "How quickly the economy and earnings decelerate will probably determine whether a year-end rally is possible," said Ed Clissold, Ned Davis' chief U.S. strategist. "Historically speaking, the fact that the market is down year to date makes a year-end rally less likely but not highly improbable." "When the S & P 500 has been up through September, over the last three months of the year it has risen 83.1% of the time by a median of 4.7%," he added. However, "when the S & P 500 has been down through September, it has risen only 54.8% of the time by a median of 2.3%." On the plus side, though, while midterm election years have historically been the weakest, year-end rallies are consistently stronger in those years, Clissold noted. "The low in the autumn of the midterm year to the summer of the preelection year has been the strongest period of the four-year cycle," he said. The S & P 500 temporarily broke below its June closing low of 3,666 Friday and strategists say if it goes below the low again, and stays there, it could signal the next range of targets at 3,400 or below . The broad market index is down 23% this year and more than 7% for the month to date in September. If the losses hold through Friday, that would make the first nine months of this year the worst since 2002 and the fourth worst since 1926, according to Ned Davis. | 2022-09-28T02:42:03Z | www.cnbc.com | Year-end rally hopes are starting to get dashed. What history tells us | https://www.cnbc.com/2022/09/26/year-end-rally-hopes-are-starting-to-get-dashed-what-history-tells-us-about-what-comes-next.html | https://www.cnbc.com/2022/09/26/year-end-rally-hopes-are-starting-to-get-dashed-what-history-tells-us-about-what-comes-next.html |
The Pound's decline since Friday is certainly due to the newly unveiled fiscal policy that has hit market confidence, but analysts believe it's still a dollar story when viewed over a longer time frame.
Fahad Kamal
CIO at Kleinwort Hambros
"It's absolutely a dollar story, the US economy is on a much stronger footing. As you know, we've seen a million jobs created there over the last three months. And rates are rising there in the face of red hot aggregate demand, very different to the reason that rates are rising in much of the rest of the world, particularly in the UK, and Europe, where it's much more defensive and much more in a bid to control inflation. But inflation has been driven by an exogenous shock, not by demand. "
The Fed's rate hikes so far this year have led to a strengthening dollar, with the dollar index now surpassing 114 points and reaching a 20-year high.
Investors are concerned that a strong dollar will drag down global economic growth and could also lead to a financial crisis in emerging markets.
A stronger dollar means that commodities denominated in dollars, such as oil, become more expensive for buyers using foreign currencies, which could push up inflation levels in their home countries and affect demand. Concerns about the economic outlook also weighed on the price of crude oil, with futures on both WTI and Brent crude falling more than 2 percent on Monday.
In addition, a stronger dollar has had a strong impact on emerging markets. Since many emerging market countries borrow in U.S. dollars, a stronger dollar leads to more debt when translated into national currencies. At the same time, the Fed's interest rate hike has caused yields on dollar-denominated assets to rise, which has prompted foreign investors to pull money out of emerging market countries and into dollar-denominated assets, causing capital outflows from emerging markets.
We have seen the amount of dollar-denominated cross-border credit outstanding in emerging markets rise dramatically over the past 20 years, with the total amount now four times higher than it was in 2006. Several countries are also on the verge of debt crises due to large depreciations of their currencies and foreign exchange shortages.
In addition, the stronger dollar has made the overseas earnings of U.S. multinationals, when converted to dollars, less, resulting in a lower return on investment. This is directly reflected in the overall decline of the stock market.
The S&P 500 fell below its June low, while the Dow Jones was accelerating lower at the end of the session, re-entering into the bear market territory. Morgan Stanley expects the S&P 500 to slide to a position around 3,000 early next year.
We can see that the dollar strength has a great impact on the global economy and markets. The latest statements from Federal Reserve Bank of Cleveland President Loretta Mester show that further interest-rate increases are needed to stamp out stubbornly high inflation and interest rates will not fall back in 2023. This means the recent upward momentum in the dollar has further to run. | 2022-09-28T02:43:13Z | www.cnbc.com | CCTV Script 27/09/22 | https://www.cnbc.com/2022/09/27/cctv-script-27/09/22.html | https://www.cnbc.com/2022/09/27/cctv-script-27/09/22.html |
The climate crisis is fueling extreme weather events including record droughts, and with stress growing on global water systems HSBC said investors should own stocks with exposure to water infrastructure. In a recent note to clients, the firm said water systems are a "huge investment" theme over the coming years, identifying key players in various sub-sectors of the over-arching theme. The firm noted that revenue across its water-focused basket of stocks has risen more than 30% since 2014 - 2015 as spending rises for antiquated systems that are unable to withstand extreme weather events and rising global temperatures. "Climate change is associated with widespread changes in worldwide weather patterns, leading to water scarcity, droughts and floods, as well as contamination of water supplies," the firm said in a note to clients. "We think companies that offer water management solutions across various industries could gain from rising awareness about addressing the global water scarcity issues," HSBC added. Water systems are complex, and investing around the theme can mean picking companies in different industries. HSBC defines the broader theme as investing in companies that "provide products and services for drainage, storm water, flood protection, desalination and dredging." It also includes water infrastructure companies that provide pipes, pumps and meters, as well as those that deal with water purification, wastewater treatment and reducing leaks. American Water Works is one of the companies that HSBC pointed to. The Camden, New Jersey-based company is the largest publicly-traded water and wastewater company in the U.S., providing water and wastewater services to 14 million people across 24 states. Investors typically flee to defensive areas of the market during times of uncertainty, but American Water Works has not escaped the recent selling. The stock is down about 8% over the last month, and more than 25% for the year. HSBC also pointed to water treatment company Ecolab and water solutions company Xylem as beneficiaries of increasing investments in water infrastructure. Smart solutions, like those that Xylem provide, are a growing area of focus as municipalities look to upgrade their water systems. The U.S. drinking water system loses 2.1 trillion gallons of water per year thanks to leaks and faulty pipes, according to the American Society of Civil Engineers. Shares of Xylem are down 25% this year, while Ecolab has shed 37%. For investors looking for more general exposure, there are several ETFs that track the space, including the First Trust Water ETF , the Invesco Water Resources ETF and the Global X Clean Water ETF . - CNBC's Michael Bloom contributed reporting. | 2022-09-28T02:44:19Z | www.cnbc.com | Global water systems will require 'huge' investment. Here are HSBC's stocks to play the theme | https://www.cnbc.com/2022/09/27/global-water-systems-will-require-huge-investment-here-are-hsbcs-stocks-to-play-the-theme.html | https://www.cnbc.com/2022/09/27/global-water-systems-will-require-huge-investment-here-are-hsbcs-stocks-to-play-the-theme.html |
The postponement was announced less than two months before the midterm elections, when Republicans hope to retake majority control of the House and Senate.
Cheney, who last month lost her GOP primary race to a Trump-backed challenger, has vowed to do all she can to keep Trump out of the White House. But Trump remains a key figure in the Republican Party, as some polls show him as the clear favorite to win the party's nomination for president in 2024.
The committee also faces an end-of-the-year deadline to submit a final report to the president and Congress containing its findings and recommendations. | 2022-09-28T02:44:51Z | www.cnbc.com | House Jan. 6 panel postpones hearing due to Hurricane Ian | https://www.cnbc.com/2022/09/27/house-jan-6-panel-postpones-hearing-due-to-hurricane-ian.html | https://www.cnbc.com/2022/09/27/house-jan-6-panel-postpones-hearing-due-to-hurricane-ian.html |
Hurricane Ian over the Gulf of Mexico on Sept 27th, 2022.
"By the time it reaches the shores of Florida, the storm is going to slow down to approximately five miles per hour, and this is significant because it means that Floridians are going to experience the impacts from the storm for a very long time," she added.
Correction: A previous version of this story misstated the projected speed of the storm upon its reaching Florida. | 2022-09-28T02:45:15Z | www.cnbc.com | Hurricane Ian news: White House, FEMA urge Florida residents to evacuate if asked | https://www.cnbc.com/2022/09/27/hurricane-ian-news-white-house-fema-urge-florida-residents-to-evacuate-if-asked.html | https://www.cnbc.com/2022/09/27/hurricane-ian-news-white-house-fema-urge-florida-residents-to-evacuate-if-asked.html |
With the market turmoil raging on, the majority of Wall Street investors are now favoring dividend-paying stocks and value names into the end of the year, according to the new CNBC Delivering Alpha investor survey. The S & P 500 hit a new bear market low on Monday, taking out its prior low in June and bringing its decline from its all time high to 24%. We polled about 400 chief investment officers, equity strategists, portfolio managers and CNBC contributors who manage money, asking where they stood on the markets for the rest of 2022 and beyond. The survey was conducted this week. About a third of the respondents said they are most likely to buy stocks paying high dividends now. Unlike growth stocks, dividend stocks typically don't offer dramatic price appreciation, but they do provide investors with a stable source of income during times of uncertainty. A dividend is a portion of a company's earnings that are paid out to shareholders. The three most popular dividend exchange-traded funds are the Vanguard Dividend Appreciation ETF , the Vanguard High Dividend Yield ETF and the Schwab U.S. Dividend Equity ETF . When asked which three sectors will be the biggest winners over the next year, the investors picked health care, energy and financials, which lean towards the value side of the market, according to the survey. Energy has been the only S & P 500 sector that's in the green this year with a 26% gain. Health care and financials have pared better than growth-oriented stocks, down 14% and 22% this year, respectively. The survey also showed that investors' biggest concern right now is the Fed being too aggressive. | 2022-09-28T02:45:46Z | www.cnbc.com | Investors favor dividend payers and value stocks as market hits new bear low, CNBC survey shows | https://www.cnbc.com/2022/09/27/investors-favor-dividend-payers-and-value-stocks-as-market-hits-new-bear-low-cnbc-survey-shows.html | https://www.cnbc.com/2022/09/27/investors-favor-dividend-payers-and-value-stocks-as-market-hits-new-bear-low-cnbc-survey-shows.html |
Jeffrey Gundlach says he has been buying bonds "recently" with yields suddenly looking toppy after climbing this week to their highest levels in more than a decade. On Monday, the yields on the 2-year and 5-year U.S. Treasury notes hit their highest levels since 2007, while the 10-year rate hit a high not seen since 2010. They had pulled back some by Tuesday morning. Yields and prices move in opposite directions with prices going higher overnight as rates fell. "The U.S. Treasury Bond market is rallying tonight," said the so-called bond king and DoubleLine Capital CEO in a tweet late Monday night. "Been a long time. I have been a buyer recently." Gundlach's buying follows his comments from a little more than a week ago that investors should sell stocks and buy bonds. "It was brutal to be a bond investor for the past several years but now it's actually the place to be and the opportunities are more exciting now than any time, in my view, in the past 10 years," he said on a webcast. He also revealed then that DoubleLine had bought long-term Treasurys earlier in the month with rates at attractive levels in the beaten-up stock market. The 2-year Treasury was yielding 4.25% on Tuesday and the 10-year Treasury was at 3.86% Those comments came ahead of the Federal Reserve's two-day policy meeting that concluded on Sept. 21 when interest rates rose by 0.75 percentage point, as expected. The Fed also indicated the terminal rate will go as high as 4.6% before it's done hiking, and that it will be particularly aggressive this year, raising to 4.4% before the end of 2022. Gundlach has said the Fed is "over-tightening" and that looming deflationary forces could force it to reverse that policy. That would send yields lower and bond prices higher. | 2022-09-28T02:45:59Z | www.cnbc.com | Jeffrey Gundlach buys Treasurys, sees most attractive market in years | https://www.cnbc.com/2022/09/27/jeffrey-gundlach-is-buying-treasuries-after-calling-bond-market-most-attractive-in-10-years.html | https://www.cnbc.com/2022/09/27/jeffrey-gundlach-is-buying-treasuries-after-calling-bond-market-most-attractive-in-10-years.html |
American and JetBlue face antitrust trial over joint sales agreement
The carriers argue the deal allows them to better compete against larger airlines. But the Biden administration contends the agreement is effectively a merger that will drive up fares. Last September, the Justice Department along with the attorneys general of six states and the District of Columbia sued to block the partnership, which was approved in the final days of the Trump administration.
However, the antitrust push has run into obstacles. Earlier this month, a federal judge denied the Justice Department's bid to block UnitedHealth's acquisition of Change Healthcare. Last week, another federal judge rejected the DOJ's bid to stop a merger between two major U.S. sugar refiners.
An American Airlines plane lands on a runway near a parked JetBlue plane at the Fort Lauderdale-Hollywood International Airport on July 16, 2020 in Fort Lauderdale, Florida.
The trial against the airline alliance comes as JetBlue is in the process of trying to acquire discount carrier Spirit Airlines for $3.8 billion to create the country's fifth-largest airline, a deal that faces a high hurdle with regulators, though that partnership isn't a part of the lawsuit.
American and JetBlue, in a pretrial brief filed Saturday, said that there is no evidence that consumers have been harmed by the alliance and that it allows them to expand in capacity-constrained airports where they wouldn't be able to on their own.
Witnesses are expected to include the airlines' top executives, including JetBlue's CEO, Robin Hayes, the first witness scheduled for Tuesday. Other airlines' executives could also testify.
"No one's ever lost votes for being critical of airlines," said Matt Colbert, who previously managed operations and strategies at several U.S. carriers and is founder of consulting firm Empire Aviation Services. | 2022-09-28T02:46:05Z | www.cnbc.com | JetBlue, American Airlines go to court in Justice Department antitrust fight | https://www.cnbc.com/2022/09/27/jetblue-american-airlines-go-to-court-in-justice-department-antitrust-fight.html | https://www.cnbc.com/2022/09/27/jetblue-american-airlines-go-to-court-in-justice-department-antitrust-fight.html |
Published Mon, Sep 26 202210:58 PM EDT Updated Tue, Sep 27 20223:33 AM EDT
The British pound continued its slide against the U.S. dollar this week, hitting a new record low against the greenback Monday. Sterling briefly touched $1.0382 i n Asia trading β the lowest level on record since 1971β as investors weigh the cost of U.K. Prime Minister Liz Truss' sweeping tax cuts and investment incentives that will be financed by further government borrowing. "The pound's decline since last week shouldn't be misunderstood as a mere consequence of dollar strength. It is a consequence of an extremely risky budget by the new chancellor and a rather timid Bank of England that so far has only raised rates reluctantly despite all the clear pressures," British economist Jim O'Neill told CNBC on Monday. The former Goldman Sachs Asset Management chairman and former U.K. Treasury minister said the Bank of England will have to raise interest rates "more aggressively" as a result, and the government will need to possibly "roll back some of its fiscal ambition" for the pound to recover. Sterling's relentless slide this year reflects the difficult macro environment in the U.K., which is struggling with its worst cost-of-living crisis in decades and a series of futile interest hikes that have so far failed to rein in inflation. Parity with the U.S. dollar? Many market watchers believe there could be more pain ahead for the embattled pound. "The pound-dollar is likely to remain vulnerable in the near-term and a test of parity with the dollar cannot be ruled out," Abhilash Narayan, senior investment strategist at Standard Chartered , told CNBC Pro. Goldman Sachs European strategist Sharon Bell said the bank expects the pound to trade at around $1.05 over the next three months. Alvin Tan, head of FX trading at RBC Capital Markets, has a year-end target of $1.04 on the pound and said there is "growing risk" of the currency hitting parity in early 2023. Meanwhile, Morgan Stanley strategist Graham Secker is even more bearish; he sees the pound hitting $1.02 by year-end. Winners Secker is overweight the blue-chip FTSE 100 , which he believes is "arguably the ultimate 'weak FX' play." In a note on Sept. 26, Secker noted that 40% of the index's capitalization is derived from stocks that report revenue in U.S. dollar. These stocks collectively contribute nearly 60% of the index's earnings, he added. Goldman's Bell also likes the "internationally exposed" FTSE 100 β which comprises "a lot of commodity, global consumer and health care companies that make money outside the U.K." "Typically, when sterling falls, the FTSE 100 rises," she told CNBC Pro. "It's typically inversely correlated between the two." Read more The best global performers last week include an energy stock analysts say could jump 15% Asset manager says one FAANG stock looks 'very attractive' in the medium term From the Fed to Europe's currency crisis, here's what's behind this selloff in financial markets James Morton, founder and chief investment officer at Santa Lucia Asset Management, believes U.K. companies in the natural resource sector will be a particular beneficiary of a weaker pound. "Most natural resource companies have the bulk of their revenues priced in U.S. dollar, whereas their cost structure is likely to be denominated by weaker currencies relative to the dollar. This is not limited to the natural resource sector, but quite a big chunk of the U.K. stock market," he said. Meanwhile, Standard Chartered's Narayan said he remains overweight on U.K. equities. "The fiscal stimulus should be a marginal positive for growth while pound weakness should support corporate earnings β¦ Additionally, the U.K. should benefit from its relatively high exposure to defensive, value-oriented sectors such as energy and financials, as well as the high dividend yield on offer," he said. Losers While market watchers remain largely positive on big-cap firms, Goldman's Bell believes their small and mid-cap counterparts are likely to fare worse. "The losers in the U.K. are the small-and-mid cap companies that are importing raw materials, which has now become more expensive. Retailers are a good example. Some of the domestic banks are also sensitive to sterling weakness. The FTSE 250 , which is more domestic than the FTSE 100, will also tend to suffer, all else equal, as sterling falls," Bell said. Morgan Stanley's Secker also advises against looking at more domestic U.K. investments such as the FTSE 250, "which tend to underperform when pound-dollar is falling." | 2022-09-28T02:46:35Z | www.cnbc.com | Market pros name the likely winners and losers as sterling slumps | https://www.cnbc.com/2022/09/27/market-pros-name-the-likely-winners-and-losers-as-sterling-slumps.html | https://www.cnbc.com/2022/09/27/market-pros-name-the-likely-winners-and-losers-as-sterling-slumps.html |
Team Captain Phil Mickelson of Hy Flyers GC is seen on the 18th tee during Day Two of the LIV Golf Invitational - Chicago at Rich Harvest Farms on September 17, 2022 in Sugar Grove, Illinois.
Mickelson and 10 other LIV-affiliated players had filed a suit against the PGA Tour in August after the tour suspended them for their participation in the rival LIV Golf league. The suit alleged the PGA Tour's suspensions were anti-competitive.
Jonathan Grella, an LIV Golf representative, said the merits of the suit still stand and LIV will continue to pursue the case.
Talor Gooch, Hudson Swafford and Ian Poulter also dismissed their claims against the PGA Tour, according to a court filing Tuesday with the U.S. District Court for the Northern District of California. Mickelson dismissed his claim in a separate filing.
PGA Tour Commissioner Jay Monahan on the competition with LIV Golf
The Justice Department is also probing the PGA Tour for its possible antitrust violations tied to LIV Golf.
LIV Golf has also been subject of scrutiny. The league is funded in part by the Saudi Public Investment Fund, which is controlled by Saudi Arabia's crown prince. Mickelson has been criticized for his affiliation with the kingdom and has acknowledged the human rights offenses committed by the country.
Critics have also called the league an attempt at "sportswashing" to improve the image of Saudi Arabia. | 2022-09-28T02:47:09Z | www.cnbc.com | Phil Mickelson and other LIV golfers drop out of antitrust suit against PGA Tour | https://www.cnbc.com/2022/09/27/phil-mickelson-and-other-liv-golfers-drop-out-of-antitrust-suit-against-pga-tour.html | https://www.cnbc.com/2022/09/27/phil-mickelson-and-other-liv-golfers-drop-out-of-antitrust-suit-against-pga-tour.html |
In other news, Russia has again insisted it has a "right" to use nuclear weapons if its territory is threatened, and several suspicious leaks have hit the Nord Stream pipelines, with experts not ruling out sabotage.
European officials, meanwhile, are investigating unexplained leaks affecting both the Nord Stream 1 and 2 pipelines that bring natural gas from Russia to Europe via the Baltic Sea.
Both Europe and Russia have both said sabotage cannot be ruled out as the cause of the damage, but the finger of blame is being pointed at Moscow β which is yet to directly respond to the accusations.
Russian forces are using Iranian drones in Ukraine, Pentagon says
The Pentagon said it has observed Russian forces use Iranian drones in Ukraine.
"We do assess that the Russians are using the Iranian drones in Ukraine," Pentagon Press Secretary Air Force Brig. Gen. Pat Ryder said during a daily press briefing.
"We've also seen reports of Ukrainians shooting down some of these drones," he added, without providing more detail.
Last month, U.S. National Security Council spokesman John Kirby confirmed that Russia had received the drones but said it was "too soon to tell" how the new weapons would shape the combat.
"It remains to be seen what the overall impact is going to be on those drones, but it's not going to change the kinds of capabilities we continue to provide," Kirby told reporters on a conference call.
"We know of some difficulties that the Russians have been having with some of those drones," Kirby added, but declined to elaborate.
Nine vessels depart Ukraine carrying more than 340,000 metric tons of agricultural products
The organization overseeing the export of agricultural products from Ukraine said it has approved nine vessels to leave the besieged country.
Two ships are destined for Spain and are carrying corn, barley and wheat. Another ship will depart from Ukraine's Yuzhny-Pivdennyi port for South Korea and is carrying corn. Two ships carrying wheat and soy beans will sail to Turkey. Another ship carrying sunflower pellets will sail to Bulgaria. Two vessels from Odesa will sail to Tunisia and Romania carrying wheat and corn. The ninth vessel with leave from Chornomorsk for France and is carrying rapeseed.
A superyacht linked to a sanctioned Russian businessman fetched $37.5 million at auction
The Axioma super yacht belonging to Russian oligarch Dmitrievich Pumpyansky who is on the EU's list of sanctioned Russians is seen docked at a port, amid Russia's invasion of Ukraine, in Gibraltar, March 21, 2022.
Jon Nazca | Reuters
A superyacht linked to a sanctioned Russian businessman fetched $37.5 million at auction in Gibraltar last month after it was sold at the behest of creditor JP Morgan, a court has confirmed, in the first sale of its kind since Russia invaded Ukraine.
The 72.5-meter Axioma was impounded by the Gibraltar authorities in March after U.S. bank said its alleged owner, a company that was owned by Dmitry Pumpyansky, had reneged on the terms of a 20.5 million euro loan ($19.6 million).
NATO chief speaks with Zelenskyy and reaffirms the alliance's support
"Just spoke with President Zelenskyy and made clear that NATO allies are unwavering in our support for Ukraine's sovereignty and right to self-defense," NATO Secretary General Jens Stoltenberg wrote on Twitter.
"The sham referenda held by Russia have no legitimacy and are a blatant violation of international law. These lands are Ukraine," he added.
Ukrainian President Volodymyr Zelenskyy confirmed the call in a separate tweet and said that he thanked the NATO chief for "condemning Russia's illegal referenda."
"We discussed current battlefield developments and further support of the alliance's member states to the Ukrainian Armed Forces," Zelenksyy added.
Europe is investigating leaks in two Russian gas pipelines that churned up the Baltic Sea, raising concerns from Copenhagen to Moscow about sabotage on infrastructure at the heart of an energy standoff.
Russia, which slashed gas deliveries to Europe after the West imposed sanctions over Moscow's invasion of Ukraine, said sabotage was a possibility and that the incident undermined the continent's energy security.
A senior Ukrainian official called it a Russian attack to destabilize Europe, without giving proof.
The Nord Stream pipelines have been flashpoints in an escalating energy war between European capitals and Moscow that has pummeled major Western economies, sent gas prices soaring and sparked a hunt for alternative energy supplies.
U.N. calls for immediate release of those detained in Russia protesting Putin's mobilization order
The U.N. called on the Kremlin to release people who have been detained in Russia for protesting President Vladimir Putin's mobilization order.
"As of 26 September, according to credible reports, some 2,377 demonstrators had been arrested since last Wednesday in various locations across the country. It is unclear how many people remain in detention," wrote Ravina Shamdasani, spokeswoman for the U.N. High Commissioner for Human Rights.
"We stress that arresting people solely for exercising their rights of peaceful assembly and freedom of expression constitutes an arbitrary deprivation of liberty," Shamdasani said, adding that the U.N. calls for the immediate release of all those detained in this manner.
NATO air forces conduct training drills over Baltic Sea
Two Swedish Air Force jets fly over their home territory in 2021.
NATO members Hungary, Germany, Czech Republic, Italy, Turkey, the United Kingdom, Estonia, Latvia and Lithuania participated in the training drills dubbed "Ramstein Alloy."
"The exercise series integrates more than two dozen fighter and support aircraft and NATO airborne early warning aircraft with NATO and national command and control centers," the alliance wrote in a release.
"The realistic drills train Allied forces to deter and if needed defend against any aggression."
Russian reservists called up in Putin mobilization attend a departure ceremony
Russian President Vladimir Putin announced last week that he was mobilizing hundreds of thousands of Russian men to bolster Moscow's army in Ukraine, sparking demonstrations and an exodus of men abroad.
Reservists that have been called-up to active duty attend a departure ceremony in in Sevastopol, Crimea.
β AFP | Getty Images
Wheat rises on concern over Russian crops
Wheat is loaded aboard a cargo ship in the international port of Rostov-on-Don to be shipped to Turkey, on July 26, 2022.
Chicago wheat futures climbed, supported by concern over Russian supplies as some farmers are called to the army, while corn and soybeans rose from the previous session's near two-week low due to a slower-than-expected U.S. harvest.
The Chicago Board of Trade (CBOT) most-active corn contract was up 0.4% at $6.69 a bushel, as of 1130 GMT, and soybeans added 0.7% to $14.21-1/2 a bushel.
Wheat gained 1.5% to $8.70-1/2 a bushel.
β Rueters
European countries on Tuesday raced to investigate unexplained leaks in two Russian gas pipelines runningunder the Baltic Sea near Sweden and Denmark, infrastructure at the heart of an energy crisis since Russia's invasion of Ukraine.
Experts and also Russia, which built the network, said the possibility of sabotage could not be ruled out, Reuters reported Tuesday.
Kazakhstan to hold talks with Moscow after influx of Russians fleeing the draft
Kazakhstan is to discuss an influx of Russians to the country following President Putin's partial military mobilization last week.
President of Kazakhstan Kassym-Zhomart Tokayev told Russian news agency Interfax that there is "neither crisis nor panic" in the country in connection with the influx of Russians, but called the situation "difficult."
"We will hold talks with the Russian side and will solve this problem in the interests of our country," he said.
"We do not have a crisis or panic. The government must do its job. Visitors from abroad will be assisted, but they will not receive any preferences" the president said, adding that it was important for Kazakhstan to maintain good relations with its Russian neighbor.
"The most important thing is that we maintain agreement with neighboring countries. We will not lose anything from this. In recent days, many people from Russia have been coming to us. Most of them are forced to leave due to the current hopeless situation. We must take care of them and provide their security. This is a political and humanitarian issue. I instructed the government to take the necessary measures," Tokayev said.
On September 23, the border service of the National Security Committee of Kazakhstan reported that it was registering an increase in the number of foreigners entering the border with Russia. That came a day after President Putin announced the call-up of 300,000 military reservists to fight in Ukraine, prompting a mass exodus from the country as men tried to escape the draft.
Russia says it has right to use nuclear weapons if territory threatened, top official says
Former Russian President Dmitry Medvedev said Russia has the right to use nuclear weapons if Moscow deems it necessary, and if it deems its territory is under threat from conventional weapons.
Medvedev is seen as a close ally of President Putin and is currently the deputy chair of Russia's Security Council. During the war he has infrequently taken to Telegram to issue aggressive anti-Western and pro-war statements.
On Tuesday, he wrote on the social media site, "Our enemies love to make grandiloquent statements [and] operate with the terms 'freedom', 'democracy', 'mission'. In fact, this is just ritual verbal diarrhea," he said, with the "topic of recent days is the Russian nuclear threat."
"I have to remind you again ... Russia has the right to use nuclear weapons if necessary. In predetermined cases. In strict accordance with the fundamentals of state policy in the field of nuclear deterrence [or] if we or our allies are attacked using this type of weapon. Or if aggression with the use of conventional weapons threatens the very existence of our state," he wrote.
Russian and PM Dmitry Medvedev and President Vladimir Putin arrive at a meeting at Novo-Ogaryovo State Residence on July 28, 2017 outside of Moscow, Russia.
There are heightened concerns that Russia could resort to using a nuclear weapon in Ukraine after it annexes more territory in the country β a move it is expected to announce later this week after a series of sham referendums in occupied parts of the country on joining Russia.
Despite the illegitimacy of the votes, which are widely regarded as rigged and coercive, Russia is expected to announce the annexation of four regions of Ukraine into the Russian Federation. There are concerns that Russia could resort to using nuclear weapons, justifying it on the grounds of defending Russian territory.
Russia has repeatedly insisted it would not use such catastrophic weapons, though Putin has regularly boasted about possessing such weapons. Last week, he warned the world again that he was not "bluffing" that he could use nuclear weapons, a warning the West is taking seriously.
"Russia's leaders almost certainly hope that any accession announcement will be seen as a vindication of the 'special military operation' and will consolidate patriotic support for the conflict," Britain's Defense Ministry said in an intelligence update Tuesday. | 2022-09-28T02:47:27Z | www.cnbc.com | Live updates: Latest news on Russia and the war in Ukraine | https://www.cnbc.com/2022/09/27/russia-ukraine-live-updates.html | https://www.cnbc.com/2022/09/27/russia-ukraine-live-updates.html |
The S & P 500 broke below its June low, and Wall Street is debating whether the sell-off is nearing an end or is more pain in store for investors. The S & P 500 briefly fell to 3,623 Tuesday, a new bear market low, below its June intraday low of 3,636. The market continued to test that level in afternoon trading. The broad market index closed at 3,647 Tuesday, down 0.2%. "It's definitely in testing mode right now," said Todd Sohn, Strategas technical analyst. "We're still in very vulnerable shape. It's rates. It's the dollar. The important thing is none of the macro pressures have gone away or resolved themselves. Bonds are totally broken, and the FX market has gone wild." Stocks were mixed in afternoon trading as Treasury yields rose sharply on the day. The benchmark 1 0-year note yield was at 3.96% Tuesday, edging toward the key 4% level. The dollar index was flattish at 114.14, as the euro continued to slide. The euro was at $0.9595 to the dollar. "I think 3,500 is in play because it's the midway point for the rally from March 2020 to the high, which was Jan. 4 this year. That lines up with levels near the pre-Covid crash high," said Sohn. However, Fundstrat's Mark Newton said he sees signs that this sell-off could be nearing an end, and he does not see significance in the break below the June low. "It doesn't mean we have another 10%, 15% down by any stretch," he said. "A lot of my work focuses on the market bottoming by the first week of October." Newton said he sees signs that yields and the dollar could peak in October. "That should be the catalyst that causes stocks to rally," he said. Newton said he expects October through December to be bullish for stocks. "When sentiment is as negative as it is heading into the so-called 'bear killer' month, you usually get a nice reprieve. I'm not banking on this decline continuing," he said. Newton pointed to conditions that are similar to when the market hit bottom in mid June. He said the percentage of stocks above their 20-day, 50-day and 200-day moving averages are in the single digits. For instance, just 2.98% of the constituents in the S & P 500 were above their 50-day moving average. That number was 1.98% on June 17. The 50-day is simply the average closing price over the past 50 sessions. A stock that can close above it could show positive momentum. Meanwhile, Sohn noted that a few developments will need to take place before stocks can move forward. "Until the dollar comes off the boil and there's some stabilizing in rates, I think it's hard for risk assets to do anything," he said. | 2022-09-28T02:48:16Z | www.cnbc.com | The S&P 500 falls to a fresh low for the year. Here's where stocks may go next | https://www.cnbc.com/2022/09/27/the-sp-500-falls-to-a-fresh-low-for-the-year-heres-where-stocks-may-go-next.html | https://www.cnbc.com/2022/09/27/the-sp-500-falls-to-a-fresh-low-for-the-year-heres-where-stocks-may-go-next.html |
Credit Suisse says the "green" hydrogen sector is about to get a boost, and it's time to get invested. "Green hydrogen is a growth market," the bank said, describing it as an "essential" technology in reaching net-zero targets, as the world shifts toward renewables. It expects production to expand about 40 times by 2030, it said in a Sept. 23 report. Two stock picks As such, Credit Suisse thinks it's time to enter the sector β but stressed that it's important to be selective. It named two stocks it rated "outperform": U.K.-based Ceres Power and Italian firm Industrie De Nora . The bank said Ceres Power, which makes electrolyzers for green hydrogen, benefits from a "unique" licensing model which gives it the potential for the lowest unit costs and lower execution risks in the sector β thanks to its reliance on global blue chip manufacturers with mass manufacturing capabilities. It gave Ceres Power a price target of Β£12.50 ($13.20) β an upside of over 230% from Monday's close. Industrie De Nora, which makes components to produce green hydrogen, can benefit from tax incentives from the U.S. Inflation Reduction Act, Credit Suisse said. The bank added that the firm may continue to get orders above market rate, given its superior technology. Credit Suisse gave Industrie De Nora a price target of 21.50 euros ($20.75) β an upside of about 40% from Monday's close. Funding boost Credit Suisse said hydrogen is set to benefit from another wave of European funding, worth 5.2 billion euros ($5 billion). The European Union's executive arm, the European Commission, has said it wants 40 GW of renewable hydrogen electrolyzers to be installed in the EU by 2030. Electrolysis is one method of producing hydrogen. "We expect this demand is accelerated by meaningful policy support for the green hydrogen industry in both the US and Europe, especially as European nations look to alternative, reliable and sustainable energy supplies in light of the recent Russian invasion of Ukraine sending gas prices soaring," Credit Suisse said. Hydrogen is heralded by some as a renewable power source. It has the potential to play an important role in tackling the climate crisis β the energy it creates produces no atmosphere-warming carbon dioxide . On the flipside, it is a leak-prone gas that can generate its own warming effect β in turn worsening the climate problem β if not managed well . "Clean" hydrogen is also expensive to produce and the industry is still in its infancy. There are several types of hydrogen, including green, blue and gray. Some have recognized the environmental benefits of green hydrogen, but critics say it may not be an efficient source of energy , among other things. Nevertheless, Credit Suisse listed three factors that paint a more positive outlook for green hydrogen: Europe's latest funding rounds; the U.S. Inflation Reduction Act, which offers generous tax credits that makes green hydrogen more affordable; and the current low natural gas prices, which makes it cheaper to produce. | 2022-09-28T02:49:05Z | www.cnbc.com | Green hydrogen stocks: Credit Suisse says it's time to buy | https://www.cnbc.com/2022/09/28/green-hydrogen-stocks-credit-suisse-says-its-time-to-buy-.html | https://www.cnbc.com/2022/09/28/green-hydrogen-stocks-credit-suisse-says-its-time-to-buy-.html |
It's been a tough year for markets, as investors grapple with a strong U.S. dollar, stubbornly high consumer prices and the prospect of higher-for-longer interest rate hikes. "The market backdrop is very much dominated by the actions of central banks and what appears to be increasingly hawkish rhetoric. It will be the path of inflation, how central banks respond to it, that determine the path of markets over the short and medium term," Neil Veitch, investment director at Edinburgh-based SVM Asset Management, told CNBC Pro Talks last week. He believes the macro landscape will remain "quite difficult" for the remainder of the year. "We have got a lot of uncertainty as to where inflation may end up through 2023 and how central banks will respond to that. We have got third-quarter earnings coming on. I think we will be okay, but as we have seen with companies like FedEx , where perhaps they were over-earning through the pandemic, there may be some quite significant readjustments necessary for forecasts," he said. Veitch believes the market will become "more constructive" in the first quarter of 2023 β though he thinks earnings estimates will have to come down first. "I think earnings will be the driver over the short term and at the moment, any sort of negative surprise is being heavily punished by the market. That's typically the pattern of behavior in a bear market β short termism and negative momentum dominates," he added, echoing the comments of a slew of market watchers who have long warned that earnings estimates remain too high . Inflation will also have to come down meaningfully β below 4% β before the Fed slows it current rate of tightening, Veitch said. Buy the dip? So how should investors position against this backdrop? While Veitch cautioned that "there are a lot of moving parts" and indicated he would stay "tactically cautious," he also sees opportunities to buy the dip. "With stocks down in many instances at 50% and trading on high single-digit or low double-digit price-to-earnings, even allowing for the risk of further earnings downgrades, they are beginning to look more attractive," Veitch said. "It's perhaps a little bit too early to pull the trigger for shorter-term money, but if you have a medium-term outlook, some of these businesses I think are discounting an awful lot and ultimately we'll come out the other side of this, whenever that is, in a better and stronger position," he added. Growth, value or both? Veitch also waded into one of the key debates on Wall Street today β the battle between value and growth stocks. He favors a barbell approach, liking U.S. consumer behemoths that are "de facto monopolies," as well as "classic value, early cyclical businesses," such as selected retailers that he believes would respond positively when the Fed starts to slow its pace of rate hikes. "Again, it's all going to be about stock picking. It's no point just selecting retailers across the board. We have to try and understand what the medium-term dynamics are, what their long-term earnings potential is," he said. Within the growth space, he finds some FAANG stocks , such as Alphabet , attractive on a medium-term basis. | 2022-09-28T02:49:11Z | www.cnbc.com | Neil Veitch: key stock market drivers and how he's trading the market | https://www.cnbc.com/2022/09/28/neil-veitch-key-stock-market-drivers-and-how-hes-trading-the-market-.html | https://www.cnbc.com/2022/09/28/neil-veitch-key-stock-market-drivers-and-how-hes-trading-the-market-.html |
Some members of Congress have above average investing returns β soon, 2 new ETFs will let you follow along with them
Want to see how members of Congress are trading? These two new ETFs will let you do just that.
If you can't beat 'em, join 'em seems to be the unofficial mantra of two new exchange-traded funds, or ETFs, recently filed as a way to track the trading of U.S. Congressional members and their families.
Subversive Capital filed a Form N-1A on Sept. 15 to establish two ETFs that will follow exactly how Democrat and Republican members of Congress are trading. Subversive Capital is working with Unusual Whales β a retail trading tool for individual stocks, options and crypto β to provide data for the ETFs.
The Democrat-tracking ticker will be named NANC, after Speaker of the House Nancy Pelosi, while the Republican-tracking ticker will be called KRUZ, after Sen. Ted Cruz.
Recently, the subject of congressional members trading stocks has raised questions regarding the potential for insider trading and conflicts of interest, leading to the introduction of legislation that would restrict those in Congress from being able to buy and sell individual stocks. Until that legislation is passed, though, you will soon be able to bury your own investment dollars into following their trades, passively, once the new ETFs are released.
Here's what you need to know about the political implications of Congressional stock trading and the new ETFs that are being created to track it.
The rules of Congressional stock trading
According to the STOCK Act, which was passed in 2012, members of Congress are required by law to file any stock trades with the Securities and Exchange Commission within 45 days.
Unfortunately, this provides little value to everyday Americans since the markets can change drastically from the time when a member of Congress enacts a trade to when it becomes publicly available. The fines for not abiding by the rules are also negligible compared to the major stock-trading profits being made β just $200 for first-time offenders.
Over the last 10 years, members of Congress have received major scrutiny for using their positions of power for their own profit during a historic bull market β Jacobin, a popular left-leaning magazine, even labeled Rep. Pelosi as the 2021 Wall Street Trader of the Year.
As much as there are valid points being made for government officials to be involved in the markets, Andrew Lautz, director of federal policy at the National Taxpayers Union, argues that they shouldn't be considered average participants for two reasons β because they have access to privileged information, and because their policy proposals and decisions have the ability to move such markets.
As a result, legislation is currently in the works to ban members of Congress from trading individual stocks, a move that has gained bipartisan support. But for now, those in Congress can still buy and sell stocks at their pleasure β and it's possible for you to get in on the potential profits as well.
Here's how the new ETFs will work
Both ETFs, NANC and KRUZ, will have one simple objective β to help you follow the trades of both Democrat and Republican members of Congress and their spouses. The actively managed funds will track their trades based on their public filings, which are required by the aforementioned STOCK Act.
Because these are actively managed exchange-traded funds that require constant buying and selling, the ETFs will charge investors a 1% management fee. That's quite pricey compared to passively managed funds such as the Vanguard S&P 500 ETF, VOO, which charges a fee of just 0.03% to participate.
Each ETF will have between 500 to 600 individual stocks at a time. With lawmakers and their family members racking up an estimated $355 million worth of stock trades in 2021, according to an article by MarketWatch, it appears these funds will be regularly shifting their stock positions.
As of this writing, a launch date for the new ETFs has yet to be determined. It's also unclear what will happen to the two new ETFs if the congressional stock trading ban does eventually pass.
Learn more: What are ETFs and should you invest in them?
How you can get started investing
While the ethics of members of Congress trading stocks is still up for debate, there are always a number of opportunities for everyday investors to enter the market.
Keep in mind that while our elected leaders may want to take their chances when it comes to buying and selling individual stocks, it's nearly impossible to effectively buy and sell stocks and beat proven indices such as the S&P 500 over time. In fact, even Warren Buffett, one of the greatest investors of all time, says the majority of investors should stick to buying index funds to foster long-term growth.
If you're still interested in watching the stock market and day-trading stocks, consider using the 90/10 strategy β in other words, keep 90% of your portfolio invested in steady long-term growth index funds or ETFs, and leave the remaining 10% to speculate with. That way, worst-case scenario, if you completely lost that 10%, you'd still have another 90% set up to grow for the long term.
Here are a few of our favorite accounts to help you get started on your investing journey:
$0 for stocks, ETFs, options and some mutual funds
Stocks, bonds, fractional shares, ETFs, mutual funds, options
Some ETFs donβt have expense ratios
Mobile app is easy to use
No commissions on many types of securities
No futures or forex trading
High fees for broker assisted trades
While there are many ethical and political issues to consider when it comes to matters of investing, for now, these two new ETFs would allow you to actively invest similarly to our members of Congress.
Before you get started on your own investment journey, it's important to check in on other goal-related items you may want to accomplish, such as paying down high-interest debt or putting money aside in an emergency fund β stashing your money in a high-yield savings account would garner a higher return and offer a higher interest rate than a traditional savings account.
Once you've taken care of those, investing for the future can be a great step toward accomplishing more of your financial goals, such as owning a home or saving for retirement.
4 investing apps to help newbies and experts build their wealth from anywhere
5 warning signs that show you're not ready to start investing, according to financial planners
This checklist will help you determine when you're ready to invest your money | 2022-09-28T02:49:25Z | www.cnbc.com | Congressional Stock Trading Could Soon Be Tracked by These 2 New ETFs | https://www.cnbc.com/select/congressional-stock-trading-could-soon-be-tracked/ | https://www.cnbc.com/select/congressional-stock-trading-could-soon-be-tracked/ |
ING: BOE might have to extend bond purchases with ongoing market volatility
As of Wednesday, the Bank will begin temporary purchases of long-dated U.K. government bonds in order to "restore orderly market conditions," and said these will be carried out "on whatever scale necessary" to soothe markets.
The Monetary Policy Committee's target of an annual Β£80 billion ($85 billion) reduction of its gilt holdings remains unchanged, the Bank said, with the first gilt sales β initially slated for Monday β now taking place on Oct. 31.
A U.K. Treasury spokesperson confirmed that the operation had been "fully indemnified" by the Treasury and said Finance Minister Kwasi Kwarteng is "committed to the Bank of England's independence."
"The Government will continue to work closely with the Bank in support of its financial stability and inflation objectives," the spokesperson added.
The Bank said it will publish a market notice outlining the operational details of the program "shortly."
Yields on U.K. 30-year gilts and 10-year gilts dropped by more than 30 basis points following the announcement.
'Caught in a crossfire'
Antoine Bouvet, senior rates strategist at ING, said the Bank of England may need to extend the bond purchases beyond the initial two-week period if volatility in the gilt market continues, and that an additional hike to interest rates was not off the table.
Bouvet told CNBC immediately after the announcement that the Bank's first priority for now had to be the functioning of the gilt market, suggesting the worst outcome would be for the sovereign to be left without market access and unable to secure financing.
"Clearly the gilt market was caught in a crossfire between the Bank of England and the Treasury, and it's not exactly like that but it looked a lot like they were competing, or working at crossed purposes," Bouvet said.
"So you have a world where you have a recession and the BOE is trying to cool the economy with hikes, and on the other hand you have the Treasury that is trying to shield the economy from that recession and implementing fiscal measures that are inflationary."
He added that the Treasury's statement of support was important, noting that the government would be keen to avoid the impression that the gilt market is in "so much trouble" that it had forced the Bank of England to take hold of rescuing the economy. | 2022-09-28T12:00:20Z | www.cnbc.com | Bank of England delays bond sales, launches temporary purchase program | https://www.cnbc.com/2022/09/28/bank-of-england-delays-bond-sales-launches-temporary-purchase-program.html | https://www.cnbc.com/2022/09/28/bank-of-england-delays-bond-sales-launches-temporary-purchase-program.html |
The S & P 500 this week took out its mid-June low, a level many investors were hoping would hold as the bear market bottom. The Dow Jones Industrial Average also closed in bear market territory on Monday for the first time since the early days of Covid in 2020, finally joining the S & P 500 and the Nasdaq there. Now what? First, let's get our definitions straight. A close 20% or more below a recent high is considered a bear market for a specific stock or index. The current bear market in the S & P 500 was triggered on June 16 when the index closed more than 20% below its prior peak, which was a closing record on Jan. 3. That previous high then becomes the starting point of the bear market. So the current bear market started in early January and won't be considered over until the S & P 500 closes 20% or more above its bear market low, which can only be determined in hindsight. However, that doesn't keep Wall Street from speculating about when a bottom might occur or when it might have already occurred. For a while, that June 16 low was looking like a good candidate for a bottom. But Monday and Tuesday, the S & P 500 closed lower, setting new bear market lows each day. Notably, the term "rolling bear market" has also been one we have heard in recent years. It describes a market in which various components are experiencing their own declines of 20% or more, even though the overall index manages to hold up. By the way, who decided that 20% was the threshold anyway? We don't have an answer for you, except that it's the arbitrary number designated for the term bear market β just as a 10% or greater decline from a prior high is reserved for a correction in a stock or index. Bear markets past Historically, S & P 500 bear markets have lasted, on average, 370 days with an index decline of roughly 36% from peak to trough, according to our compilation of research. Some recent extreme examples of bear markets include the dot-com bubble burst of 2000, which led to a bear market of about 2Β½ years and saw the index fall nearly 50%; the 2007-2009 global financial crisis, which coincided with a bear market that lasted just under 1Β½ years and saw the index collapse over 50%; and the Covid pandemic, which saw a bear market of just over a month and the index fall by a third. Importantly, though there's often a link, not all bear markets coincide with recessions. For example, in 1987, the crash referred to as Black Monday was neither the cause of, nor did it lead to, a recession. And while the economy did then go into a recession from late 1990 to early 1991, the stock market didn't enter another bear market until the aforementioned dot-com bubble popped nearly a decade later. Today's bear market In the current bear market in the S & P 500, now nearly 270 days old, stocks are under pressure as a result of the Federal Reserve and other central banks around the world raising interest rates, Russia's ongoing war in Ukraine, and the economic implications of China's zero-Covid policy. The S & P 500 has dropped about 24% from its all-time high on Jan. 4. But we don't think that the current macroeconomic challenges imply declines as deep and long-lasting as in the prior bear market scenarios mentioned, especially considering the resiliency we see in the labor market at the moment. We are inclined to think that, though there may still be some more pain ahead, the worst is likely behind us. Investing in a bear market There are various options for how different sorts of people can play a bear market like the one we find ourselves in. These fall into roughly three camps: traders, passive investors and long-term investors like us. The trader On one end of the spectrum, you might approach this market with the mindset of an active trader and bet to the downside, or short stocks, and get out of stocks completely. (At the Club, we only buy stocks long, betting they will go up, and always look to stay invested. Our small cash position might go up or down depending on market conditions and other factors.) With the market already down over 20%, a trader in that position would have to be betting that the economic outlook is about to worsen materially. It's certainly possible: Russia could escalate its war in Ukraine; tensions between China and the U.S. over Taiwan could accelerate; and/or Fed rate hikes could plunge us into a deep recession. The issue with going this route, though, is the risk of correctly timing the turnaround. A trader might get out of the market and save some downside, but will they be able to get back in in time? Very few can pull off this kind of timing successfully, and even fewer can do so consistently. Moreover, we think a trader would be bailing on great companies at the best valuations we have seen in years, all to get back into them, hopefully, at just slightly lower prices. It's also worth keeping in mind that, at the individual stock level, many great companies have already declined far more than that average 36% bear market drawdown we cited earlier. The passive investor At the other extreme, there's the totally passive investor, who may simply want to keep up with whatever contributions they were already putting into their 401(k), for example, or maybe even increase them given the decline. This investor knows that markets go up and down β though, generally in a positive direction on a long enough timeline β and they've decided not to factor in the daily, weekly or even yearly fluctuations. It's not as risky for mutual- and index fund-type investors. But with a hands-off approach, the risk is higher if individual stocks are owned because companies can go out of business. The Investing Club approach Then, there are those somewhere in the middle, where we fall, who are active investors seeking to take advantage of short- or medium-term bouts of volatility in an attempt to enhance longer-term gains. While we may look to manage around a core position, buying when stocks appear oversold and selling at relative strength, we're not trying to day trade. At a high level, our approach is the same as it has always been β to buy shares in the beaten down stocks of what we believe to be high-quality companies. We don't like to hop in and out, and we don't seek out buys simply based on the passing of time as one might with a 401(k) contribution every two weeks. Rather, we look to manage each position independently in the context of a diversified portfolio, focusing on individual stock valuations in an attempt to suck money out of the market in the near term , while maintaining long-term exposure. We attempt to be granular in our approach, adding to positions when the buys can help lower our overall cost basis β ideally, always snagging shares at a cheaper level than we have in the past β and peeling shares off on relative strength when positions grow a bit too large, on swift moves up in an overbought market, or simply when we need to rebuild our cash coffers. Still, one shift in our strategy during this bear market could be to more quickly raise cash on the up days, knowing those seeking to trade the market are going to be in "sell-the-rip" mode. Conversely, we might also be slower to step in on the declines, understanding that we are no longer in "buy the dip" mode. And given the headwinds the economy faces, we may also be more inclined to target those companies that can better weather a slowdown. Bottom line But as painful as it may be right now, the one thing history tells us is what always follows a bear market is a bull market. Being mindful of this and incorporating our understanding of previous bear markets, we are still aiming to exploit short-to-medium-term weakness in order to maximize longer-term gains. In the long run, stocks will reflect company fundamentals. While some earnings power may be taking a near-term hit due to macroeconomic pressure, we are targeting those companies in which we believe that earnings will bounce back and eclipse prior levels when macro headwinds abate. In the words of the late investor Shelby Davis, "You make most of your money in a bear market, you just don't realize it at the time." (See here for a full list of the stocks in Jim Cramer's Charitable Trust.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
People with umbrellas pass by bull and bear outside Frankfurt's stock exchange during heavy rain in Frankfurt, Germany. | 2022-09-29T00:59:24Z | www.cnbc.com | How to navigate a bear market β we look to history for answers and tell you how we're doing it | https://www.cnbc.com/2022/09/28/how-to-navigate-a-bear-market-we-look-to-history-for-answers.html | https://www.cnbc.com/2022/09/28/how-to-navigate-a-bear-market-we-look-to-history-for-answers.html |
India's startup market is worth betting on, though it's still "a few years" behind China's, Facebook co-founder Eduardo Saverin said.
During a panel discussion at the Forbes Global CEO Conference in Singapore this week, Saverin said his investment company B Capital is deploying "a lot of dollars" into India and is thinking about the long-term success of new companies there.
"I think India is a huge market with just tremendous potential," he said, in response to a question on why India's startup ecosystem has not generated better returns.
"I think India is a huge market with just tremendous potential," Saverin said, in response to a question on why India's startup ecosystem has not generated better returns.
"And I think as the market continues to mature, and as you get into a better macroeconomic environment, it is a market to bet on, combined with Southeast Asia."
Much of the growth in India will come from enterprise tech companies, Saverin said, adding that B Capital has put money into a electronic health records company and contract management companies. Enterprise tech companies are those that create software that serve businesses.
The 2022 Forbes CEO Summit in Singapore
Underpinning India's entrepreneurial success is its large population, and the country, along with Southeast Asia, will soon have more people than China, Saverin said. He added that 25 million children are born each year in India.
Gautam Adani, an Indian billionaire and the second-richest person in the world according to Forbes, said in his keynote speech at the same conference that "India is now on the cusp of creating several thousands of entrepreneurs."
Adani claimed that of the 760 districts in India, over 670 have at least one registered startup.
"A smartphone and inexpensive data, mixed with aspirations, make the most potent mix to transform a nation. And the digitally enabled India's journey is just beginning," he said.
And actually, some of the biggest companies out there, I think Microsoft started during a recession
B Capital co-founder
But Saverin warned that the pace of evolution of India's startups is behind China's in areas such as ease of asset exits and the liquidity of the market.
According to India's Ministry of Finance report from August, the country's foreign direct investments in the first quarter of the year still lagged behind China's. China received more than $100 billion in FDI, while India's inflows were around $17 billion.
Investing in tougher times
He added that when capital is constrained by a slowing economy, as is the case now, entrepreneurs need to seize the opportunity to "build mission critical products." The term "mission critical" refers to services and goods that are necessary for the operation of a business.
"And I think environments like this create resilient businesses and it's actually a time to invest, not to pull back. So entrepreneurs would actually look at this as an opportunity to acquire, to bring in companies while others are looking inward, for them to be aggressive and acquire and consolidate," Saverin said.
"And actually, some of the biggest companies out there, I think Microsoft started during a recession."
Also speaking at the Forbes conference, Venture capital firm GGV Capital's Jenny Lee, who has backed some of the most well-known companies in China β including Didi Chuxing, XPeng and Kingsoft WPS β said it's time to look further ahead as the geopolitical contest between the U.S. and China and pandemic-triggered upheaval in global systems put a "huge grind" on public valuation of companies.
Chinese entrepreneurs can succeed without the US market: GGV Capital
"We're happy, because I think as a private investor, we're investing in the next generation of leaders, the next three years, five years, 10 years. And so it's really back to a more rational market, back to backing true entrepreneurs who want to make a change," Lee said during the same panel as Saverin.
There are plenty of opportunities in tougher times, Lee said, citing the electric vehicle/autonomous vehicle (EV/AV) and metaverse industries as new areas to invest in.
Saverin, for his part, said "climate tech" is going to be "huge" and his company will be doubling down on biotech. | 2022-09-29T04:15:03Z | www.cnbc.com | Eduardo Saverin: India's startup market has tremendous potential | https://www.cnbc.com/2022/09/29/eduardo-saverin-indias-startup-market-has-tremendous-potential.html | https://www.cnbc.com/2022/09/29/eduardo-saverin-indias-startup-market-has-tremendous-potential.html |
The rapid descent into new lows for the S & P 500 this week has dragged down nearly every stock, including some of the favorite names of Wall Street analysts. That could present an opportunity for investors looking for quality stocks and future upside in a volatile environment. The stocks in the table below are trading within 5% of their 52-week low, but have a buy rating from more than 70% of Wall Street analysts that cover them. Those analysts expect the stocks to do more than just hold their ground during a sell off. The stocks have an average price target upside of 20% or more, and earnings growth expectation for 2022 of at least 10%. The list includes some big names, such as tech giant Microsoft and Mastercard . Mastercard has one of the best combinations of target price upside and projected EPS growth on the list, at 48% and 25.9%, respectively. The payments stock has dropped about 20% year to date, which is slightly better than the S & P 500, but is down 15% since Sept. 12. Microsoft, meanwhile, has a buy rating from 72% of analyst. That puts the software giant behind only ServiceNow and Signature Bank , which have approval ratings of 82% and 100%, respectively. Microsoft generates a lot of revenue from subscriptions for both consumers and businesses, which is seen as stickier than other types of spending. Last week, Credit Suisse named Microsoft one of top companies with "a protective moat for uncertain times." To be sure, using currents earnings growth estimates could prove to be a misstep in the current market environment. Many Wall Street pros believe that current earnings estimates are too high and will be revised sharply if the U.S. enters a recession. Those worries could be part of why oilfield services stock Baker Hughes has such large upside. Analysts currently see the stock trading nearly 70% below its fair price, with earnings growth of 52% coming up. Concern about a global recession has driven down the price of oil on demand concerns. One good piece of news for Baker Hughes is that it less directly impacted by short-term fluctuations in oil prices than some other companies that sell crude. | 2022-09-29T06:13:25Z | www.cnbc.com | Buy the dip? These stocks trading back at their lows are loved by analysts | https://www.cnbc.com/2022/09/28/buy-the-dip-these-stocks-trading-back-at-their-lows-are-loved-by-analysts.html | https://www.cnbc.com/2022/09/28/buy-the-dip-these-stocks-trading-back-at-their-lows-are-loved-by-analysts.html |
Many popular companies dominating the ESG investing space are taking advantage of the U.S. government and investors, according to Carson Block, founder of Muddy Waters Research. "I would like to save the world," the famed short-seller said during an interview with "Squawk Box" outside CNBC's Delivering Alpha conference on Wednesday. "I believe that we do have problems. However, these companies that I've seen, are not the ones who are going to save us. Many of these are just money grabs, dressed up β clad in green." ESG, or environmental, social and governance investing, incorporates a slew of non-financial factors potential shareholders utilize when looking to invest in companies. It's risen in popularity amid a drive toward green investing with companies like BlackRock hopping on the trend while also drawing its fair share of criticism. Block said a slew of companies he's shorted β including XL Fleet , Danimer Scientific and solar stock Sunrun β are "grifting in their own way" and misleading investors. "When you get into the solar space β like Sunrun β I mean, they're grifting the U.S. government by inflating the basis for their tax subsidy, so they're screwing the U.S. government, they're screwing investors by basically creating this illusion of a lot of value at the end of the rainbow," he said. Block also called out companies he said attempt to offset wrongdoing in one area of their business and believes more money should be funneled into nuclear energy, especially given the ongoing energy crisis in Europe. "There's so much froth in that space that still needs to unwind," Block said. | 2022-09-29T06:13:37Z | www.cnbc.com | Carson Block calls out ESG investing, says some companies are 'money grabs' | https://www.cnbc.com/2022/09/28/carson-block-calls-out-esg-investing-says-some-companies-are-money-grabs-.html | https://www.cnbc.com/2022/09/28/carson-block-calls-out-esg-investing-says-some-companies-are-money-grabs-.html |
According to a survey of 904 schools released by the U.S. Department of Education's National Center for Education StatisticsοΌ53% of public school principals said their schools were understaffed entering the 2022-23 school year. For teaching positions, 48% of principals said they had difficulty recruiting, while for non-teaching positions, 60% said they could not find the staff to fill the vacancies.
The top five jobs with the most severe vacancies were: special education teachers, transportation staff, custodial staff, mental health professionals, and general elementary teachers. Among teaching positions, math teachers and teachers who teach English as a second language have the most serious shortages.
In fact, the problem of teacher shortages has been a long-standing one in the United States, but Covid-19 has made the problem even worse. According to the National Center for Education Statistics, only about 20 percent of principals reported being understaffed before the epidemic, but during the epidemic, the number of reported shortages has about doubled.
Thus, we can see that this new school year has seen difficulties in recruiting teachers for U.S. public schools, which include reasons like "too few candidates applying for open teaching positions", "a lack of qualified candidates applying for open teaching positions", "candidates felt the salary and benefits for teaching positions were not enough."
The transition to online teaching, burnout from Covid-19, frequent student absences during the epidemic, school violence, and generally low salaries have caused many teachers who had a passion for education to leave the profession.
According to the National Education Association, the average annual salary of public school teachers will be about $65,000 (about 466,000 RMB) from 2020 to 2021, ranging from a high of around $90,000 in New York to around $47,000 in Mississippi. US education secretary Miguel Cardona says U.S. teachers earn 33% less than other jobs that require a college degree. Over the past 25 years, when inflation is taken into account, the average teacher's income is only $29 more than it was 25 years ago.
To address the faculty shortage, the U.S. Department of Education announced new grants totaling more than $60 million yesterday, bringing the Biden-Harris Administration's additional support for teachers through the Fiscal Year 2022 grant competitions to more than $285 million.
Although schools are already hiring heavily, some education finance experts say the influx of new money will create new positions in the education system. This also means that job openings will continue. | 2022-09-29T06:13:49Z | www.cnbc.com | CCTV Script 28/09/22 | https://www.cnbc.com/2022/09/28/cctv-script-28/09/22.html | https://www.cnbc.com/2022/09/28/cctv-script-28/09/22.html |
Lauren Taylor Wolfe, center, Roy Swan, left, and Shundrawn Thomas at CNBC's Delivering Alpha, Sept. 8, 2022.
Adding to the confusion is the broad approach to ESG β firms can be focused on different metrics, whether it be one specific area, such as environmental factors, or maximizing social impact β sometimes at the expense of returns.
ESG β or environment, social and governance β investing gained widespread attention during the pandemic, with assets under management ballooning and funds attracting record inflows. Regulators are now calling for enhanced disclosures around ESG, but Shundrawn Thomas, founder and managing partner of The Copia Group, said investors have been investing around their principles for years.
"I think some of the same trends that we see, whether you talk about how asset owners want to use their investment dollars and heft to impact things that are very important to them β that's a trend that's been in place for quite some time," he said.
Thomas added that while metrics might be more codified now, he's been using the same tools throughout his investment career β which spans three decades β to identify opportunities in the market.
Even if returns aren't the sole focus of an investment vehicle, sustainable investing can still generate alpha for investors.
Roy Swan, director of the Ford Foundation's Mission Investments, said the firm can invest around high-impact ideas while also maintaining the returns that are necessary to sustain a perpetual endowment.
The Ford Foundation said in August that its Mission Investments portfolio generated a compound annual return rate of 28% from its inception in 2017 through 2021.
"The reason why we disclosed that information was we wanted to encourage others who are on the fence about whether impact investing can ... address big social problems, advance human welfare and generate financial return, so that you can recycle and do it all over again," he said Wednesday. | 2022-09-29T06:14:33Z | www.cnbc.com | ESG without returns 'simply not sustainable': investor Lauren Taylor Wolfe | https://www.cnbc.com/2022/09/28/esg-without-returns-is-simply-not-sustainable-says-investor-lauren-taylor-wolfe.html | https://www.cnbc.com/2022/09/28/esg-without-returns-is-simply-not-sustainable-says-investor-lauren-taylor-wolfe.html |
Published Wed, Sep 28 202212:59 AM EDT Updated Wed, Sep 28 20222:20 AM EDT
Goldman Sachs has predicted further pain for a raft of European indices over the short term, with one expected to be firmly in a bear market by the end of the year. The Euro Stoxx 600 is expected to fall by nearly 8% by the end of this year, the investment bank said in a report to clients on Monday. On Tuesday, the index fell by 0.1% and was trading around 388. It's also down around 8% over the last month. If it were to fall to 360, as Goldman expects, it would be lower by more than 25% from its recent peak earlier this year. Goldman predicted that the index of pan-European large companies will return to current levels over the next six months, but should increase to 410 in a year β a 9% rise, including dividends. The Wall Street bank also downgraded its price target for the FTSE 100 to 6600 and the Euro Stoxx 50 to 3100 for the next three months. That is a decline of 6% and 7.4% respectively from current levels. "We have been bearish on equities, arguing that this bear market is not yet over," the analysts said. What's driving the downgrades? Goldman said its forecast for a recession in Europe in 2023 had "deepened." It now expects euro area economies to contract by 0.4% next year, worse than previously expected. GDP in the U.K. is also likely to fall by 0.3% next year, according to the bank. The research note said that interest rate hikes by the European Central Bank and the Bank of England, along with soaring energy costs due to the reduced flow of gas from Russia, will lead to a "moderate" recession in the coming months. Although natural gas prices have fallen from their late August peak, they remain higher by at least ten times their long-term average. Goldman also said that while healthy household finances, a strong job market and subsidized energy prices will "soften the impact" of rising interest rates, it will be insufficient to mitigate it entirely. How to position Goldman Sachs is particularly bearish when it comes to earnings forecasts for European companies. A survey by FactSet reveals that analysts expect earnings per share for 2023 in Europe to grow by 3%. In contrast, Goldman expects EPS to decline by 10% next year. A number of other market participants are also turning negative on earnings expectations. "As growth slows, and costs continue to rise, we expect margins to be hit," the analysts said. The Wall Street giant predicted that retailers would be the most affected due to their dependence on consumer incomes for profits. The construction and chemical sectors are also vulnerable due to their exposure to high energy prices, it added. The bank is underweight on all three sectors. It is overweight (OW) on "some defensive" sectors, including healthcare and telecoms, as well as banks and energy. "We favour a barbell approach, with some quality areas, for example our High & Stable Margins basket ... where EPS is likely to remain resilient, some Defensives (OW Healthcare, Telecoms, Defence ...) and some Value areas which we think are particularly underpriced," the analysts wrote. Since February, Goldman Sachs said it had seen fund managers selling European shares every week. However, it warned that while the selling wasn't large yet, a comparison with previous downturns showed that there is more to come. | 2022-09-29T06:14:51Z | www.cnbc.com | Goldman Sachs predicts stock market bottom for Europe; says how to position | https://www.cnbc.com/2022/09/28/goldman-sachs-predicts-stock-market-bottom-for-europe-says-how-to-position.html | https://www.cnbc.com/2022/09/28/goldman-sachs-predicts-stock-market-bottom-for-europe-says-how-to-position.html |
Users may see visual stories and short videos from visitors to a city and tips on things to do. Google said users will be able to zoom into a neighborhood and a restaurant to "get a feel for what it might be like."
Google launches new "vibe" feature that allows users to show the business, weather and features of a particular location on any given day.
Google now says it has enough local data to predict a neighborhood's "vibes" in search results.
The company is launching "immersive views" and "vibes" for some locations, adding more details in visual form so that users will be able to explore locations before they visit, Google said at its third annual Search On event Wednesday.
For searches on cities, the company said Wednesday that it is adding more search result options, including pronunciation, history, beaches and culture. Users may see visual stories and short videos from people who have visited the city, as well as tips on exploring and things to do, the company said Wednesday.
For "vibes," Google executives said users will soon be able to zoom into a neighborhood and a restaurant to "get a feel for what it might be like." It also allows them to view data on what they could expect for how busy it might be, based on Google's crowd-level data from that business, and what the weather may be like on any day they're planning to arrive.
"You can quickly know if a neighborhood is artsy or has an exciting food scene so you can make an informed decision on how to spend your time," the company said.
The features combine artificial intelligence with local data from Google Maps users who add more than 20 million "contributions," including reviews, photos and videos, the company said. Itβll roll out globally in Android and iOS in coming months.
Google also launched real-world aerial views of global landmarks. To start, it will have "photorealistic" aerial views of 250 landmarks and will be launching in Los Angeles, London, New York, San Francisco and Tokyo in the coming months, executives said. The "immersive view" will be able to combine aerial views with weather, traffic and crowds data.
The photorealistic imagery is a "huge" step forward for the company's maps product, said Chris Phillips, who runs the Google Maps business unit, known internally as Geo.
Executives did not say whether or how it will display ads in the new features. | 2022-09-29T06:14:57Z | www.cnbc.com | Google Search adds 'vibes,' 'immersive views' for some locations | https://www.cnbc.com/2022/09/28/google-search-adds-vibes-immersive-views-for-some-locations.html | https://www.cnbc.com/2022/09/28/google-search-adds-vibes-immersive-views-for-some-locations.html |
Investors 'can't ignore China' even with rising geopolitical risk, pension fund managers say
Long-term investors can't afford to miss out on China's growth, even as geopolitical risks have become a growing concern for markets in 2022, two top pension fund managers said at CNBC's Delivering Alpha conference Wednesday. Russia's invasion of Ukraine has rocked markets this year, especially for those investors who had exposure to Russian debt or equities. Sanctions from Western nations effectively halted trading for Russia-linked stocks and created questions about whether even the country's sovereign debt was in default. That war served to highlight the risk surrounding China's tense relationship with Taiwan, causing investors to worry about how similar sanctions on Beijing would affect global markets. Many investors were already wary of investing in China after the country placed new restrictions on its technology companies and U.S. regulators have pushed for greater accounting transparency for firms with listings in America. However, the leaders of two major pension funds told CNBC's Melissa Lee that China was too important for global markets to avoid. "Russia is small. It's a huge energy power with nukes, so it's important from that perspective. But it's not connected to the world in other ways," said Anastasia Titarchuk, the chief investment officer for the New York State Common Retirement Fund. "China is different. I think you cannot ignore China." "Corporations cannot ignore China, investors cannot ignore China, because if you want to ignore China, you also are going to ignore all the partners that China has." Titarchuk said her portfolio does have exposure to China, albeit underweight relative to global indexes. The New York state fund reported a value of $246.3 billion at the end of June. Edwin Cass, chief investment officer of the Canada Pension Plan, agreed that China was simply too important to the global economy to be shunned by investors. "China right now is 20% of global GDP, probably going to 25% of global GDP by 2035. And as Anastasia mentions, you can't ignore China if you're trying to understand global growth and you're trying to understand global markets," Cass said. "Most investors probably aren't comfortable betting proportionally to GDP, for reasons like liquidity. You probably haircut your allocation because of liquidity. You haircut your allocation because of geopolitical risk." Cass said his organization has a 10% allocation to China because of those risks. Canada Pension Plan reported more than 500 billion Canadian dollars in net assets at the end of June, or nearly $400 billion in U.S. dollars. "I think it's a question we'll continue to struggle with and others will continue to struggle with over time," he added. | 2022-09-29T06:15:40Z | www.cnbc.com | Investors 'can't ignore China' despite risk, pension fund managers say | https://www.cnbc.com/2022/09/28/investors-cant-ignore-china-even-with-rising-geopolitical-risk-pension-fund-managers-say.html | https://www.cnbc.com/2022/09/28/investors-cant-ignore-china-even-with-rising-geopolitical-risk-pension-fund-managers-say.html |
Major League Pickleball announced Wednesday that James and his business partner, Maverick Carter, will join its ownership ranks, along with fellow NBA champions Draymond Green and Kevin Love and others. In recent months, the sport's popularity has attracted several celebrity investors and become a big business.
James and Carter will own the team through their family office, LRMR Ventures. Other investors include investment firm SC Holdings; Paul Rivera, chief marketing officer of the SpringHill Co.; and Relevent Sports Group co-owner and CEO Daniel Sillman.
Anne Worcester, MLP's strategic advisor, told CNBC that negotiations began with the new ownership group in July and culminated with a meeting at the U.S. Open tennis tournament in August.
"We had this immediate connection over their passion for playing pickleball, their passion for growing pro pickleball grassroots. ... They bring so much experience across sports marketing, media, branding," she said.
James has already been helping drive economic development in his hometown of Akron, Ohio. Students at the I Promise School, a public school he founded, will be attending the upcoming MLP season finale in Columbus, Ohio, from Oct. 14-16. The season-ending tournament features a $319,000 purse, the largest in the sport's history.
Pickleball, which is described as a mix of tennis, Ping-Pong and badminton, has become a recreational hit and attracted major investments as entrepreneurs look to cash in on the game.
Others are investing in the chain model, mixing food, entertainment and pickleball. "Camp Pickle," which will feature a restaurant, bar, and indoor and outdoor pickleball courts, plans to open in 10 locations across the country by 2026. Similar concepts include Chicken N Pickle, Smash Park and Electric Pickle.
He said the league's newest investors and the exposure they provide will help the sport reach its goal of 40 million pickleball players by 2030. | 2022-09-29T06:16:11Z | www.cnbc.com | LeBron James buys pro pickleball team | https://www.cnbc.com/2022/09/28/lebron-james-is-a-pickleball-fan-and-player-now-hes-buying-a-team.html | https://www.cnbc.com/2022/09/28/lebron-james-is-a-pickleball-fan-and-player-now-hes-buying-a-team.html |
A volatile market is traditionally a strain on active managers as they navigate their clients' portfolios, but 2022 has proven to be an unconventional year for their operations.
According to the SPIVA U.S. Scorecard, a new study by S&P Global, large-cap active managers are experiencing the best year against their benchmarks since 2009.
On average about 68% of large-cap managers underperform their benchmarks, but the study found that only 51% underperformed in the first half of this year.
"Historically, beating the benchmark is very tough," Anu Ganti, senior director of index investment strategy at S&P Dow Jones Indices, told CNBC's Bob Pisani on "ETF Edge" on Monday.
"And there's a few key reasons why we saw this tail wind in the first half of the market."
Ganti said the declining market has brought losses across equities and fixed income, as well as rising rates and rising inflation. This type of trading environment enhances the value of active management skills, she said.
"No. 1 is rising dispersion, which measures the spread among returns in an index," she said. "The greater that dispersion is, the greater the opportunity to add value from stock selection."
According to the SPIVA study, higher dispersion implies a greater possibility of generating above-average performance through judicious stock selection. But it also implies a magnified risk of selecting a laggard, resulting in plenty of opportunities to both add and lose value.
"Two other points for you," Ganti said. "Historically, we've seen that active portfolios tend to be closer to equal in cap weighted. So perhaps that was another tail wind of the underperformance of mega caps. And finally, we've seen the recovery in value after decades of underperformance. These are all some of the reversals this year that potentially played a role."
Not only is 2022 a slightly better year for individual advisors, but larger firms like Capital Group and Morgan Stanley are also entering the ETF space.
"It is good news for the ETF space," Tom Lydon, vice chairman of VettaFi, said in the same segment.
"We hope that we're going to see less fees, we think we're going to see a lot more tax efficiency," he said. "Trading costs have come down, which are all things that work against you trying to beat that benchmark."
But Lydon also questioned why managers seeking to outperform aren't looking beyond sectors with diminishing weighting in the S&P 500, like energy and utilities.
"If you're reading the tea leaves and just getting the signals from economists in the markets, you think you would have pushed a little bit more in," he said. "I think there's too much sector hugging, which is impeding the ability of advisors and managers to beat their benchmarks."
Since first being released in 2002, the SPIVA U.S. Scorecard has monitored the debate between active versus passive management. While the results of the first half of 2022 show promise for fund managers, the long-term results are telling. Eighty-four percent of active managers underperform benchmarks after five years. That jumps to 90% after 10 years, and 95% after 20 years.
So far this year, Ganti said it's been a "disappointing" cycle for large-, mid- and small-caps growth managers across the board.
"It's interesting because initially, you would have thought that perhaps they could have tilted towards value which outperformed," she said. "And perhaps these growth managers were more concentrated in the growthier names compared to our index, and hence they were hurt by that weakness and growth." | 2022-09-29T06:16:41Z | www.cnbc.com | Many large-cap active managers are beating their benchmarks, despite 2022's market tumult | https://www.cnbc.com/2022/09/28/many-large-cap-active-managers-are-beating-their-benchmarks-despite-2022s-market-tumult.html | https://www.cnbc.com/2022/09/28/many-large-cap-active-managers-are-beating-their-benchmarks-despite-2022s-market-tumult.html |
Netflix is planning to launch an ad-supported alternative in the coming months, and Atlantic Equities thinks this could lead to big gains for the beaten-down streaming stock. Analyst Hamilton Faber upgraded the stock to overweight and slapped a price target of $283 per share, implying a gain of 26% from current levels. The stock is down about 62.8% since the start of 2022. An ad-supported business "could be extremely material and do not believe the benefit is currently reflected in consensus," Faber wrote Wednesday in a note to clients. Netflix is expected to launch the lower-cost, ad-supported tier in November. The streaming giant was originally opposed to the idea, but leadership wanted to expand "consumer choice" while trying to reverse the first subscriber loss in more than a decade. Ad-tier revenue should surpass $8 billion by 2025, which would account for about 15% to 20% of total company revenue, Faber said. He expects about 80% of revenue from the ad-supported tier to filter down to the company's bottom line. To be sure, expectations could be missed if competition steps up or if the pre-pandemic levels of churn return. But Netflix currently has about seven times more viewers than competitor Hulu, leading Faber to estimate that Netflix's average revenue per user with ads would be about three times that of its Disney -owned competitor. "Given the current US ARPU is $16, that gives the company huge flexibility in offering a low pried ad-supported tier," he said. "It also means that any subscribers that move from ad-free to ad-supported are likely to be highly accretive to total ARPU." Atlantic Equities is not the only firm cheering the new tier. Evercore ISI and Oppenheimer both upgraded the stock to out perform earlier this month, noting the upside of the ad-supported tier. β CNBC's Michael Bloom contributed to this report. | 2022-09-29T06:17:05Z | www.cnbc.com | Netflix gets upgrade at Atlantic Equities, which says ad-supported subscriber tier can boost stock by 26% | https://www.cnbc.com/2022/09/28/netflix-gets-upgrade-at-atlantic-equities-which-says-ad-supported-subscriber-tier-can-boost-stock-by-26percent.html | https://www.cnbc.com/2022/09/28/netflix-gets-upgrade-at-atlantic-equities-which-says-ad-supported-subscriber-tier-can-boost-stock-by-26percent.html |
Dylan Field, CEO and cofounder of Figma, and Elena Nadolinski founder and CEO of Iron Fish, walk to a morning session during the Allen & Company Sun Valley Conference on July 7, 2022, in Sun Valley, Idaho.
The design space overall has a lot of room to run, says Bessemer Venture Partners' Elliott Robinson | 2022-09-29T06:17:37Z | www.cnbc.com | Penpot, an open-source rival to Figma, raises $8 million | https://www.cnbc.com/2022/09/28/penpot-an-open-source-rival-to-figma-raises-8-million.html | https://www.cnbc.com/2022/09/28/penpot-an-open-source-rival-to-figma-raises-8-million.html |
Meanwhile, U.S. President Joe Biden approved $1.1 billion more in military aid for Ukraine.
Four vessels to leave Ukraine carrying more than 110,000 metric tons of agricultural products
One ship carrying wheat is destined for Bangladesh. Another ship will depart from Ukraine's Yuzhny-Pivdennyi port for Libya and is carrying corn. Two ships carrying corn and sunflower meal will sail to Romania and Italy from Ukraine's port of Chornomorsk.
Zelenskyy speaks with British Prime Minister Liz Truss on Russian referendums and more aid for Ukraine
Ukrainian President Volodymyr Zelenskyy said he spoke with British Prime Minister Liz Truss about the war in his country.
"The UK has always been among the leaders in supporting Ukraine. We expect London's leadership in reaction to Russian sham referenda as well," Zelenskyy wrote in a tweet. "Defense and financial aid to Ukraine must be enhanced in response," he added.
The British government confirmed the phone call between Truss and Zelenskyy in a separate release.
"The prime minister made clear that the UK would never recognize Russian attempts to annex sovereign territory. She reiterated that Ukraine could depend on the UK's support until president Putin was defeated," according to the readout of the call.
Truss thanked Zelenksyy for his work in securing the release of five British nationals held prisoner by Russian forces in eastern Ukraine.
"The leaders also discussed how the UK and Ukraine could work together to secure Ukraine's gas supplies in the long term," according to the readout.
Biden approves another $1.1 billion in military aid for Ukraine
The Biden administration announced $1.1 billion in additional military aid for Ukraine, bringing U.S. commitment to more than $16.2 billion since Russia's invasion in late February.
Earlier this week, the White House said that the U.S. would never acknowledge the results of the "sham referendum" and would continue providing Kyiv with military and humanitarian support.
U.S. ambassador to the UN will propose resolution to condemn Russia's 'sham referenda'
The U.S. ambassador to the United Nations said the Biden administration would put forward a resolution that condemns Russia's "sham referenda" and calls on all states to not recognize any altered status of Ukraine.
"We are doing this because, as President Biden said last week, if nations can pursue their imperial ambitions without consequences, then we put at risk everything that this institution stands for," Linda Thomas-Greenfield told reporters at the United Nations.
"We know how one country will feel about this resolution, but we are hoping to see the rest of the council stand strong in refusing to accept the redrawing of borders through the use of force by any country," she said.
Voting in the referendums, which Western countries say are illegitimate, have been taking place in Donetsk and Luhansk in east Ukraine, and Zaporizhzhia and Kherson in the south. The Kremlin maintains that the vote is legitimate.
Germany will 'never recognize the results of the sham referendum,' chancellor says
German Chancellor Olaf Scholz spoke on the phone with the Ukrainian President Volodmyr Zelenskyy about Russia's war and the recently held referendums in four Russian-occupied regions of Ukraine.
"The chancellor stressed that Germany would not stop providing concrete political, financial and humanitarian support to Ukraine, as well as in the defense of its sovereignty and territorial integrity, including arms supplies," according to a German government readout of the call.
Scholz also said that Germany "would never recognize the results of the sham referendum" in the Ukrainian regions of Luhansk, Donetsk, Kherson and Zaporizhzhia.
The two leaders agreed to stay in close contact.
One-way economy flights from Moscow to Dubai are nearly $5,000 as Russians flee mobilization
Dubai-owned Emirates is one of few major airlines to continue its direct flight service to Russia as other carriers cease operations over Moscow's invasion of Ukraine.
One-way economy flights from Moscow to Dubai are going for as much as $5,000 and many have completely sold out in the days following Russian President Vladimir Putin's declaration of a "partial" mobilization of 300,000 reservists to fight in Ukraine.
The roughly five-hour flight cost around $350 one week before the announcement delivered on Sept. 21.
Current prices on UAE airlines Emirates and FlyDubai for the month between Sept. 28 and Oct. 26 are going for between $2,577 and $4,773 for a one-way economy ticket, according to those airlines' websites. The cheaper of those prices is more than 2Β½ times the average monthly Russian salary of $965, according to Statista.com.
NATO chief galvanizes allies to offer more support to Ukraine
NATO Secretary-General Jens Stoltenberg galvanized allies to allocate more money for defense as Ukraine fights back Russia's invasion.
"Wars are unpredictable, so no one can tell how long this will last," Stoltenberg said in his opening remarks before the European Parliament.
"This could continue for the long haul and we need to be prepared to provide support," he said, adding "the reality is that we don't have any choice."
Stoltenberg also said that Ukraine's counteroffensive would not have been possible, in part, if not for the substantial support from NATO, the European Union and the United States.
Ukraine's foreign minister calls on countries who have remained neutral during Russia's war to 'take a stand'
Ukrainian Foreign Minster Dmytro Kuleba called on countries who have taken a neutral stance on Russia's war in Ukraine to "take a stand."
"Neutral countries will not be able to sit back: they need to take a stand. The stand of justice, the stand of international law and the protection of security and peace in the whole world," Kuleba said during a press conference.
"I want to appeal to all the countries that recently insisted on the need for negotiations and offered their mediation services: Russia does not want any negotiations, stop playing this game," Kuleba, Ukraine's top diplomat, added.
He called on countries to continue supporting Ukraine with military and humanitarian aid
U.S. Embassy in Russia tells U.S. citizens to leave the country as soon as possible
The U.S. embassy in Moscow, Russia.
Invizbk | Istock Unreleased | Getty Images
The U.S. Embassy in Russia has issued a security alert for American citizens in the country, telling them to leave immediately if they can.
The embassy issued a statement Tuesday in which it said "U.S. citizens should not travel to Russia and those residing or travelling in Russia should depart Russia immediately while limited commercial travel options remain."
The warning comes after the Russian government began a military mobilization of its citizens last week, with several hundred thousand men being called up and sent to Ukraine to fight.
A traveller reacts after crossing the border with Russia at the frontier checkpoint Verkhny Lars - Zemo Larsi, Georgia September 28, 2022.
Irakli Gedenidze | Reuters
The U.S. Embassy warned Tuesday that "Russia may refuse to acknowledge dual nationals' U.S. citizenship, deny their access to U.S. consular assistance, prevent their departure from Russia, and conscript dual nationals for military service" and that anyone wishing to leave Russia should do so as soon as possible.
"Commercial flight options are extremely limited at present and are often unavailable on short notice. Overland routes by car and bus are still open. If you wish to depart Russia, you should make independent arrangements as soon as possible."
It added that the U.S. Embassy "has severe limitations on its ability to assist U.S. citizens, and conditions, including transportation options, may suddenly become even more limited."
It also warned U.S. citizens that the right to peaceful assembly and freedom of expression are not guaranteed in Russia and that they should "avoid all political or social protests and do not photograph security personnel at these events. Russian authorities have arrested U.S. citizens who have participated in demonstrations."
The embassy provided a link with more information on travel out of Russia here.
Correction: The U.S. Embassy issued its statement on Tuesday. An earlier version misstated the day.
Kremlin says claims it was behind Nord Stream leaks are 'stupid'
The Kremlin has responded to allegations that it was responsible for damage and leaks to both the Nord Stream 1 and 2 gas pipelines in the last few days by rebuffing the accusations and calling them "stupid."
European authorities are investigating possible sabotage to the Nord Stream gas pipelines, a bone of contention between Europe and Russia as the war in Ukraine continues, after they started to leak gas in the Baltic Sea earlier this week.
Kremlin spokesman Dmitry Peskov told a daily conference call with reporters that the incident needed to be investigated and the timings for repair of the damaged pipelines were not clear, Reuters reported.
Then, when asked about claims Russia might be behind the possible attack, Peskov said: "That's quite predictable and also predictably stupid."
Kremlin spokesman Dmitry Peskov at an event during Russia's Victory Day commemorations in Moscow on May 9, 2022.
Russia's foreign ministry spokeswoman Maria Zakharova appeared to suggest on Telegram that the U.S. could have been behind the sabotage, a claim that Peskov appeared to allude to when speaking to reporters Wednesday.
Newly mobilized Russian soldiers start to arrive in Ukraine, army says
Newly-mobilized Russian soldiers have started to arrive in Ukraine according to the General Staff of the Armed Forces of Ukraine in its latest operational update posted on Facebook.
Many of the soldiers that have been mobilized in President Putin's call-up, made last week and aimed at sending around 300,000 reservists to fight in the war, are poorly trained, if at all, and many have reportedly been given just a uniform and arms and no other equipment.
Ukraine's armed forces said that several Russian units in Ukraine had been replenished with new troops and that people with criminal convictions had also arrived to bolster Russia's manpower in Ukraine.
CNBC was unable to immediately verify the report although social media content in recent days has shown videos of reservists bidding farewell to family before being sent to Ukraine on trains and buses.
Fake referendums set the stage for annexation, and immense danger for Ukraine
Russian President Vladimir Putin and Defence Minister Sergei Shoigu attend a wreath-laying ceremony, which marks the anniversary of the beginning of the Great Patriotic War against Nazi Germany in 1941, at the Tomb of the Unknown Soldier by the Kremlin wall in Moscow, Russia June 22, 2022.
Moscow's mobilization won't resolve Russia's problems in the war, analyst says
Russia's partial military mobilization, which was announced by President Putin last week and sees around 300,00 reservists called-up to fight in Ukraine, will not resolve the country's challenges in the war, an analyst said Wednesday.
"Mobilisation will not solve three big problems for the Russian army: poor training, low morale, and issues with logistics and supply," Mario Bikarski, Russia & CIS analyst at the Economist Intelligence Unit said Wednesday.
"The partial mobilisation has proved unpopular particularly in disproportionately affected regions. Dagestan was the federal subject with the highest number of lost soldiers according to various estimates and the one that is now seeing some of the most intense protests," he noted.
Police officers detain a woman following calls to protest against partial mobilisation announced by Russian President, in Moscow, on September 21, 2022. - More than 1,300 people have been arrested at demonstrations across Russia against President Vladimir Putin's announcement of a partial mobilisation of civilians to fight in Ukraine, a police monitoring group said on September 21, 2022. (Photo by Alexander NEMENOV / AFP) (Photo by ALEXANDER NEMENOV/AFP via Getty Images)
"The mobilisation could exacerbate economic difficulties in impoverished regions of the country as it shrinks the workforce. It could also create a sense of racial injustice among marginalised ethnic minorities. A violent crackdown by the authorities will increase public grievances and instances of violent protests will continue," he added.
While the Kremlin has sufficient capacity to contain protests, and we have seen a brutal crackdown on anti-mobilization protests, a violent response from peripheral communities could continue, Bikarski said.
"Georgia and Kazakhstan will remain the countries with the biggest concentration of fleeing Russians. They are likely to experience a spike in accommodation prices as well as prices for certain services. It could also cause unease within the local population and public dissatisfaction with governments' responses."
Russian government regime at its 'shakiest,' says analyst
The current Russian government regime is the "shakiest we've seen," said John Herbst, director of the Eurasia Center at the Atlantic Council.
Herbst told CNBC's Squawk Box that Russian President Vladimir Putin's call for a conscription has led to a "huge problem" demonstrating that Russians do not want to fight in Ukraine.
Putin announced a partial military mobilization in Russia last week, a move that triggered a wave of protests and mass arrests.
According to the director, even senior officials who are supportive of Putin are saying that his decision is a "disaster." However, he predicts that Putin "is not going to go anytime soon."
Putin could look to turn the tide in the Ukraine war after sham referendums
CNBC's Ted Kemp discusses the Russian-run "referendums" happening in four regions of Ukraine, and says President Vladimir Putin could use them to claim that Ukraine β instead of his invading Russian army β is the aggressor the war.
The results came in last night from Russian-installed officials in the various regions, with Russian news agency Tass reporting the results. | 2022-09-29T06:17:56Z | www.cnbc.com | Live updates: Latest news on Russia and the war in Ukraine | https://www.cnbc.com/2022/09/28/russia-ukraine-war-updates.html | https://www.cnbc.com/2022/09/28/russia-ukraine-war-updates.html |
The resumption of public access will coincide with the beginning of the high court's October term, when the court's justices are due to hear arguments in three cases.
A crosswalk signal is seen outside the U.S. Supreme Court building in Washington, U.S., June 27, 2022.
And the reopening will come a year after the court resumed in-person oral arguments after more than a year of conducting those sessions remotely.
Earlier this month, Chief Justice John Roberts said public access would resume soon during an address to 10th Circuit Bench and Bar Conference in Colorado. | 2022-09-29T06:18:26Z | www.cnbc.com | Supreme Court to allow public at hearings for first time since Covid | https://www.cnbc.com/2022/09/28/supreme-court-to-allow-public-at-hearings-first-time-since-covid.html | https://www.cnbc.com/2022/09/28/supreme-court-to-allow-public-at-hearings-first-time-since-covid.html |
A trader works on the floor of the New York Stock Exchange (NYSE).
Some private tech startups that could be potential sellers have not yet decided to accept the current valuation reset as valid and will attempt to wait out this market. For their part, many investors still aren't sure if the valuation hits already taken are enough.
Ford said some of the companies that went public, are now trading at deep discounts, are now missing important growth numbers and are also no closer to attractive levels of profitability will go private.
"It's not cutting for cutting's sake" Ford said. "Make the right investment decisions to fund long-term growth," he said. "One of the things people lost sight of completely is long-term profitability. They had no idea of long-term operating margins. 'Am I 10% or 15%?' We are telling people get focused on that and set up a much better value creation story down the road," Ford added. | 2022-09-29T06:18:38Z | www.cnbc.com | The bottom isn't in yet for high-growth tech stocks, say PE investors | https://www.cnbc.com/2022/09/28/the-bottom-isnt-in-yet-for-high-growth-tech-stocks-say-pe-investors.html | https://www.cnbc.com/2022/09/28/the-bottom-isnt-in-yet-for-high-growth-tech-stocks-say-pe-investors.html |
Investors appear to be getting more bearish on crypto miner Marathon Digital , as digital currencies struggle in a tough environment for risk assets. FactSet data showed that short interest in Marathon rose by nearly 19% to 29.6 million shares as of mid-September. That accounts for roughly 27% of the company's overall float, or the shares available for trading. The stock is down more than 70% year to date. Crypto assets have been under pressure this year, with bitcoin losing 58% in 2022, as the Federal Reserve raises rates to fight inflationary pressures not seen in decades. A wave of bankruptcies and insolvency problems have also hit the crypto industry and assets. On Tuesday, bitcoin briefly topped $20,000 before sliding back under $19,000 . Crypto proxy and software company MicroStrategy is also heavily shorted, with a short interest as a percent of float at 34.5%. The stock is down more than 62% in 2022. Meanwhile, meme stock Bed Bath & Beyond saw its short interest tick lower to 29.9 million shares from 30.6 million. Short-selling is a bet against a stock practiced mostly by hedge funds and involves borrowing shares and selling them in order to buy them back more cheaply, profiting from the difference. Check out below the full list of heavily shorted stocks. (Note: The table includes stocks traded on the NASDAQ or NYSE exchanges with short interest greater than 25% of their total float and at least $100 million in market cap. Short interest data is updated twice a month and reported mid-month and at the end of the month. These figures are current as of Sept. 15 as reported by the exchanges, via FactSet. The next release date is Oct. 11 for short interest data as of Sept. 30). | 2022-09-29T06:18:50Z | www.cnbc.com | These are the most heavily shorted stocks on Wall Street, including big bets against crypto names | https://www.cnbc.com/2022/09/28/these-are-the-most-heavily-shorted-stocks-on-wall-street-including-big-bets-against-crypto-names.html | https://www.cnbc.com/2022/09/28/these-are-the-most-heavily-shorted-stocks-on-wall-street-including-big-bets-against-crypto-names.html |
Jim Chanos and Carson Block, two of Wall Street's biggest short sellers, fired shots at Sunrun , saying the residential solar company is not as "green" as many investors think. "This company is the aluminum siding of the 21st century for those who are old enough to know what I'm talking about," Chanos, founder of Kynikos Associates, said at CNBC's Delivering Alpha Investor Summit in New York City Wednesday. Aluminum re-sidings were prevalent in the 70s and 80s but they fell out of favor as the material was susceptible to scratches and dents. "It's a roofing company. It's basically a roofing company with a second mortgage subsidiary attached to it. It's not a green company. It doesn't produce solar panels," Chanos added. Chanos said Sunrun doesn't produce solar converters. Instead, it buys converters from other and leases to its customers, Chanos said. Muddy Waters Capital CIO Carson Block said he has a short position against Sunrun, taking issue with the way the company deals with tax subsidies from the government. "To the extent that the subsidies increase, this just enables companies like Sunrun to destroy more capital or more value in a shorter period of time," Block said at the conference. Block said he suspects that Sunrun classifies a lot of its sales and marketing expenses as other operating expenses. "They have tax issues and a myriad of other things," Chanos said. "But because it's seen as ESG because it's perceived, that's the variant perception and that's where you can make a lot of money on the short side when everybody believes this." Shares of Sunrun are down about 9% this year. Last month, Sunrun responded to Muddy Waters' attack, saying the short seller tried to mislead their readers with "grossly false and inaccurate assertions in a brazenly self-serving effort" to mitigate recent losses in their short position. "Muddy Waters has its 'facts' wrong. For over 10 years, our investors, lenders and independent authorities have closely diligenced our tax and valuation procedures, which Muddy Waters incorrectly describes," said Mary Powell, Sunrun's CEO and Director, in a statement. "Sunrun works hard to educate all of our stakeholders, and we appreciate that our investors have spent the time to understand renewable energy financing structures." | 2022-09-29T06:19:08Z | www.cnbc.com | Two of the most notable short sellers say this company is the aluminum siding of the 21st century | https://www.cnbc.com/2022/09/28/two-of-the-most-notable-short-sellers-say-this-company-is-the-aluminum-siding-of-the-21st-century.html | https://www.cnbc.com/2022/09/28/two-of-the-most-notable-short-sellers-say-this-company-is-the-aluminum-siding-of-the-21st-century.html |
Shares in the Asia-Pacific rose on Thursday following a rebound on Wall Street overnight. The rally in the U.S. came after the Bank of England said it would intervene in the bond market to stabilize conditions.
Hong Kong's Hang Seng index jumped 1.33% in early trade. In South Korea, the Kospi added 1.31% and the Kosdaq was 2.38% higher.
The Nikkei 225 in Japan advanced around 1% and the Topix index gained 0.37%. Australia's S&P/ASX 200 jumped 1.53%.
In mainland China, the Shanghai Composite rose 0.88% and the Shenzhen Component added around 1%. MSCI's broadest index of Asia-Pacific shares outside Japan rose 1.06%.
EV maker Leapmotor's shares plunge in Hong Kong debut
Chinese electric vehicle maker Leapmotor's shares tumbled more than 32% from its offer price of 48 Hong Kong dollars ($6.29) per share on its first day of trade in the city.
Onewo, a subsidiary of property developer China Vanke, also started trading in Hong Kong. It fell as much as 7.9% from its offer price of 48 Hong Kong dollars, but recovered slightly and was last down around 5%.
China's central bank warns against yuan bets
The People's Bank of China has warned against betting on the yuan in either direction, after its rapid decline against the U.S. dollar this week.
Two of Hong Kong's largest IPOs for 2022 to debut on the stock market
China Vanke's subsidiary Onewo and EV maker Zhejiang Leapmotor Technology are set to start trading on the Hong Kong market.
Both companies have each raised more than $700 million in initial public offerings that were undersubscribed by retail investors.
Reuters reported that Onewo and Leapmotor's shares fell in grey market trading on Wednesday. | 2022-09-29T06:20:16Z | www.cnbc.com | Asia markets rise, Hang Seng index up 2% after Wall Street rebound | https://www.cnbc.com/2022/09/29/asia-markets-wall-street-bank-of-england-ipo-currencies-oil.html | https://www.cnbc.com/2022/09/29/asia-markets-wall-street-bank-of-england-ipo-currencies-oil.html |
β This is the script of CNBC's news report for China's CCTV on September 29, 2022.
The Bank of England said in its statement that the intervention was intended to stabilize financial markets, and so far it appears that to some extent it has indeed worked.
It can be seen that overnight British 10-year and 30-year government bond yields plummeted, with the 30-year UK government bond recording the biggest drop since 1996.
The intervention also stabilized the currency market, with the pound now back up to the 1.08 level against the dollar. Just before that, the pound had briefly fallen below 1.04 to reach an all-time low.
Although we saw the BOE's intervention bringing some reassurance to the market, investors believe that The Bank of England is applying plasters on the financial wounds created by the Truss government which has shown no hint at reversing the policy. So with the government's position unclear, the question becomes to what extent will the BOE be forced to intervene in the market and how long will the intervention last?
It is also worth noting the relationship within the Bank of England. In 2013, BOE took a decision to create FPC (financial policy committee) alongside MPC (monetary policy committee). Today's decision was taken by the FPC to maintain financial stability at the long end of the curve, while the MPC's annual target of an Β£80bn stock reduction is unaffected and unchanged (only postponed till 31 October). So the market is also paying close attention to the BOE's shift timing between QE and QT.
For the economic and financial situation currently facing the UK, renowned economist Mohamed A. El-Erian said the Truss government should focus on structural economic reform and stabilizing energy while reconsidering the timing of the implementation of its tax cut plan. He warned that if the government does not do so, it will force the Bank of England to have to step in again, and that could be an unplanned emergency rate hike.
Chief Economic Advisor at Allianz
"She should keep the two elements of the package that everybody welcomes almost everybody, which is structural reforms to promote economic growth, And she shows that re-think the timing of these unfunded tax cuts. If they don't do that, the Bank of England is going to be forced into the next intervention, which will be an emergency rate hike."
In addition, the International Monetary Fund also pointed out the conflict between monetary and fiscal policy in the UK, urging the UK government to re-evaluate tax cuts. Moody's also warned that Liz Truss's mini-Budget risked "permanently weakening the UK's debt affordability", in the strongest suggestion yet that the country is facing a credit rating downgrade.
Some analysts compared the Bank of England's statement yesterday that "the purchases will be carried out on whatever scale is necessary to effect this outcome." with the former ECB President Mario Draghi's promise to do "whatever it takes" to protect the euro in 2012. Then will the Bank of England's intervention be successful in the end? And whether the new British government will adjust its policy as the market hopes? Let's wait and see. | 2022-09-29T06:20:22Z | www.cnbc.com | CCTV Script 29/09/22 | https://www.cnbc.com/2022/09/29/cctv-script-29/09/22.html | https://www.cnbc.com/2022/09/29/cctv-script-29/09/22.html |
Last week's more than 4% drop in the S & P 500 wasn't unusual. In the current quarter alone, the large-cap index has moved by a similar amount on seven occasions. How are professional investors trading amid such volatility, and what are they buying? Hedging bets Speaking to CNBC "Pro Talks," Investment Director Neil Veitch of SVM Asset Management said he manages risk by being open to any strategy that offers the "best return." One option on a "very, very short term" basis, according to Veitch, is an inverse volatility ETF (exchange-traded fund). These ETFs, such as the ProShares Short VIX Short-Term Futures ETF and Short VIX Futures ETF , allow investors to bet on a stable market in times of volatility. This is done by effectively shorting the VIX, a measure of volatility expectation based on S & P 500 index options. Some ETFs even use leverage, or debt, to amplify returns. Veitch, who manages about Β£200 million ($213 million) across three funds, also suggests another option to hedge against equities over the medium term: U.S. Treasury bonds. Historically, bond prices have tended to rise when stocks fall. They are considered safer than owning stocks. "Owning two-year U.S. Treasurys on 4% is as good a place as any for your cash at this particular juncture," he added. Rampant inflation has driven the interest rate, or yield, on short-term U.S. government debt to 4.13% from 0.76% at the start of the year. Veitch believes the market is currently reacting to the "increasingly hawkish rhetoric" of the Federal Reserve and other central banks as they try to tame inflation. "The path of inflation and how central banks respond to it determine the path of markets over the short and short and medium term," he said. Finding value If that's the environment, how is Veitch finding value in stocks, and what is he buying? The investment director pointed to a handful of equities that have been "hammered" by concerns over consumer confidence. "With stocks down and in many instances by 50%," said Veitch, who also manages the SVM World Equity Fund, "they are beginning to get more attractive." Micron Veitch disclosed that he sold off shares of chip maker Micron Technology earlier this year. Shares of the semiconductor firm have fallen by 48% to $50 since January. The fund manager said the stock would be "interesting" if it falls to about $40 a share in the future. "I suspect the next earnings update from Micron will be poor," he said. "It'll be very interesting to see how the market responds if the shares fell off aggressively. I'd expect that sell-off to be bought." JD Sports Veitch said London-listed JD Sports , a global sports apparel retailer, had a "very interesting medium-term story" as the company was expanding to the United States and Europe by targeting the "premium" segment. The Manchester, England, headquartered company, which operates over 2,000 stores across 19 countries, has seen its stock fall by more than 50% since its recent peak in November last year. SVM's UK Growth Fund has allocated 2.8% of its portfolio to JD Sports. The fund manager said that select retail stocks would likely rise next year if inflation fell meaningfully. "It's no point just selecting retailers across the board. We have to try and understand what the medium-term dynamic is, what their long-term earnings potential is," he added. | 2022-09-29T06:20:34Z | www.cnbc.com | Here's two ways to play the volatility and two stocks to scoop up | https://www.cnbc.com/2022/09/29/heres-two-ways-to-play-the-volatility-and-two-stocks-to-scoop-up.html | https://www.cnbc.com/2022/09/29/heres-two-ways-to-play-the-volatility-and-two-stocks-to-scoop-up.html |
Tech stocks have had a difficult year so far β and the tech-heavy Nasdaq Composite is on track to notch its third straight quarter of losses this week. Investors may be fleeing the sector in droves, but Barton Crockett, senior research analyst at Rosenblatt Securities, said the sell-off is an opportunity for long-term investors to buy the dip. "Stay away from the losers," Crockett told CNBC's " Street Signs Asia " on Tuesday. "I think the real opportunity to invest is to look longer term, and to buy good businesses that are being offered to you now at very reasonable valuations and people who are winners in the various secular battles and evolutionary battles in technology," he added. One such "winner" that Crockett likes is Alphabet , which he described as a "good story" that will be "here today and tomorrow." He said he believes the company has an "evergreen" position in the search segment, while its YouTube business is "very strong and well positioned" to capitalize on the growing preference for short-form videos. Alphabet also has a "great position" in cloud and has a "great equity portfolio" with stakes in companies such as self-driving project Waymo, he added. Read more Asset manager reveals what's next for stocks β and shares how he's trading the market As the pound slides, Goldman and others reveal the UK stock market's likely winners and losers Credit Suisse says now's the time to buy two green hydrogen stocks β and gives one over 200% upside Shares of Alphabet are down 32.2% this year, in line with the Nasdaq's decline. But the stock has outperformed all its peers in the FAANG (Facebook, Amazon, Apple, Netflix, and Google) grouping except Apple . While there is a "very real probability" of a slowdown in Alphabet's financials, given its global exposure, the stock trades at a "not much greater multiple than the market with a much greater business behind it," according to Crockett. "It isn't going to be immune to the cycle, but it's something you'll be happy to own over the long term β¦ This is the type of stock that I think you would look to accumulate if you have got any kind of timeframe and willingness to invest beyond the [current] economic cycle," he added. 'Be choosy' Despite the challenges of the current investing climate, Crockett said investors should remain exposed to tech. "You have to have the fortitude to ideally absorb some of the near-term gyrations for a long-term return," he said. He acknowledged several unknowns for the retail investor β such as the scale of a recession and whether one had been priced into stocks. "I think the only way to hedge it is to have some exposure to high quality names throughout the cycle and to buy them when they are on sale, which I think you have with something like Alphabet," he said. "You can be choosy. You don't have to buy everything."
Ganesh Rao5 min ago | 2022-09-29T06:20:40Z | www.cnbc.com | Rosenblatt: Buy this FAANG stock on the dip; it is a secular winner. | https://www.cnbc.com/2022/09/29/rosenblatt-buy-this-faang-stock-on-the-dip-it-is-a-secular-winner-.html | https://www.cnbc.com/2022/09/29/rosenblatt-buy-this-faang-stock-on-the-dip-it-is-a-secular-winner-.html |
The S & P 500's oil and gas sector has risen by nearly 30% this year while the broader market has sold off. And those bumper returns appear to be reversing a decade-long trend: They've now started to attract investors who had largely shunned the sector amid the clean energy push in the past decade. Investment research group Morningstar's data shows energy stocks were 11% of its Global Equity Index a decade ago. And by late 2020, the sector was just 3% of the index. But that trend has started to reverse. Here's a selection of funds that Morningstar says have recently bought oil and gas stocks. GQG Partners Global Equity Morningstar's report suggests Rajiv Jain, who runs the fund, is "the most notable energy bull." His fund has increased its exposure to oil and gas by 10 times since March 2021, when it made up just 2% of the portfolio. According to Morningstar analyst Jonathan Miller, the fund manager said he believes that production has not kept up with demand and expects prices to remain elevated for longer. ExxonMobil , Occidental Petroleum and Petrobras are three of the fund's top picks. The fund has returned 9.5% over the past year, while its benchmark index has declined by more than 10%. Miller, however, noted that Jain is an "outlier" with his outsized, positive position in the sector. Ninety One Global Strategic Mark Breedon from the company is another fund manager who recently added ExxonMobil to his diversified portfolio. Breedon said he believes ExxonMobil is focused on shareholder returns by selectively investing in specific projects. According to Morningstar, Exxon appears to be investing only in energy-transition projects in which the company has engineering expertise, such as blue hydrogen and carbon capture and storage. Exxon is one of Ninety One Global Strategic Equity Strategy's top five holdings, making up 3.3% of its fund. BlackRock BGF World Energy It's not just the diversified funds that are making significant moves within the energy sector, however. BlackRock's energy-focused fund has repositioned itself, favoring European stocks over North American ones. That's because the team behind the fund expects that European demand for non-Russian energy sources will rise in the coming months, which will in turn benefit its chosen stocks. London-listed Shell and BP make up nearly 14% of the $2.8 billion fund. According to Morningstar, fund managers Mark Hume and Alistair Bishop favor higher-quality oil producers like them, which they expect will deliver better results in a "stronger for longer oil and gas price environment." A 'completely missing' picture Shares in nearly all oil and gas companies have fallen over the past three months following a decline in crude oil prices. Brent crude has fallen below $85 a barrel after a drop in demand from China as it continues with its "zero-Covid" policy. Fears of a recession in the United States are also weighing down on the commodity. However, one analyst said that while oil prices have fallen to reflect the long-term "doom and gloom," they have not yet priced in the short-term increase in demand expected in the coming months. "Everything is pointing toward a rather bullish picture," said Victor Katona, lead crude oil analyst at the consultancy Kepler. "But that is just not reflected in the oil price. It is just completely missing." Katona expects OPEC+, the group of oil-producing nations, to cut production in its upcoming meeting to increase crude prices by 15% to 20%. "I think the natural corridor for oil prices will be somewhere between 90 and 100 [U.S. dollars per barrel] because that's the corridor with which most of the oil producers will be satisfied, especially in the Middle East," he added. Why have funds avoided oil & gas in the past? According to Morningstar, fund managers have mostly shunned the sector in light of environmental concerns . Morningstar's Miller said some fund managers have invested in companies that they think have improved their environmental, social and governance credentials. He said: "We see some positives with a ESG lens for Exxon, having responded to calls to bring in more outside voices to its board and announcing emissions reduction targets." "The firm also invests in low-carbon technologies β but each of these efforts is measured and keeps oil and gas production at the core." "So much so, they think this strategy is unlikely to win praise from environmentally oriented investors." | 2022-09-29T06:20:46Z | www.cnbc.com | The mutual funds loading up on oil stocks: Morningstar report | https://www.cnbc.com/2022/09/29/the-mutual-funds-loading-up-on-oil-stocks-morningstar-report.html | https://www.cnbc.com/2022/09/29/the-mutual-funds-loading-up-on-oil-stocks-morningstar-report.html |
To prevent an "unwarranted tightening of financing conditions and a reduction of the flow of credit to the real economy, the FPC said it would buy gilts on "whatever scale is necessary" for a limited time.
The move came after a massive sell-off in U.K. government bonds β known as "gilts" β following the new government's fiscal policy announcements on Friday. The policies included large swathes of unfunded tax cuts that have drawn global criticism, and also saw the pound fall to an all-time low against the dollar on Monday.
To prevent an "unwarranted tightening of financing conditions and a reduction of the flow of credit to the real economy, the FPC said it would purchase gilts on "whatever scale is necessary" for a limited time.
Long-dated bonds represent around two-thirds of Britain's roughly Β£1.5 trillion in so-called Liability Driven Investment funds, which are largely leveraged and often use gilts as collateral to raise cash.
These LDIs are owned by final salary pension schemes, which risked falling into insolvency as the LDIs were forced to sell more gilts, in turn driving down prices and sending the value of their assets below that of their liabilities. Final salary, or defined benefit, pension schemes are workplace pensions popular in the U.K. that provide a guaranteed annual income for life upon retirement based on the worker's final or average salary.
The market has clearly lost confidence in the incoming UK government, says Roger Ferguson
Confidence in the current UK government is at an all-time low, journalist says
The Monetary Policy Committee has so far not seen fit to intervene on interest rates prior to its next scheduled meeting on Nov. 3, but Bank of England Chief Economist Huw Pill has suggested that a "significant" fiscal event and a "significant" plunge in sterling will necessitate a "significant" interest rate move.
"The second thing to watch will be changes to the government's position. We should be in no doubt that the current market moves are the result of a fiscal event, not a monetary one. Monetary policy is trying to mop-up after the milk was spilt," Turner said.
Bethany Payne, global bonds portfolio manager at Janus Henderson, said the intervention was "only a sticking plaster on a much wider problem." She suggested the market would have benefitted from the government "blinking first" in the face of the market backlash to its policy agenda, rather than the central bank.
"However, raising bank rate while also engaging in quantitative easing in the short run is an extraordinary policy quagmire to navigate, and potentially speaks to a continuation of currency weakness and continued volatility." | 2022-09-29T10:29:21Z | www.cnbc.com | Pension fund panic led to Bank of England's emergency intervention | https://www.cnbc.com/2022/09/29/pension-fund-panic-led-to-bank-of-englands-emergency-intervention.html | https://www.cnbc.com/2022/09/29/pension-fund-panic-led-to-bank-of-englands-emergency-intervention.html |
South Korean officials have established a "bilateral engagement channel" with U.S. counterparts to resolve issues stemming from the Inflation Reduction Act (IRA).
South Korean officials claim the Act hurt Korean automakers by excluding them in its extended tax credit scheme for electric vehicles that only apply to cars assembled in America.
Lee Chang-yang, the Industry Minister, said Seoul will review whether to file a formal complaint to the WTO over such concerns, Reuters reported.
South Korean and U.S. officials are working toward a "concrete proposal" to resolve their differences over electric vehicle subsidies, South Korea's trade minister told CNBC.
"We've established a specific dialogue channel to address this particular issue, and we are glad that the U.S. government wholeheartedly engaged with us to rectify the problems," Ahn Duk-geun told CNBC's Chery Kang on Wednesday.
He was referring to concerns over EV subsidies that would put South Korean automakers at a disadvantage, with some South Korean officials calling the move a "betrayal" of the bilateral trust between the two countries.
The $430 billion climate and energy bill, or the Inflation Reduction Act (IRA), was signed into law by President Joe Biden in mid-August.
It includes federal tax credits offering consumers up to $7,500 in credit for those purchasing new electric vehicles assembled in the U.S. β and those purchasing cars made by foreign carmakers like Kia and Hyundai will not be eligible.
Hyundai is the second-biggest EV sellers in the U.S. after Tesla.
U.S. Vice President Kamala Harris and South Korean President Yoon Suk Yeol met in Seoul to discuss bilateral relations after officials from two countries engaged in talks regarding the Inflation Reduction Act, which includes a provision that Seoul claims could hurt South Korea's automakers.
"We are disappointed to see in particular this provision [was] included in the IRA without much prior consultations," Ahn said, adding the South Korean government is preparing for "all possibilities," including proposing legislative amendments to Washington.
His comment were not as strong as the heated rhetoric from Seoul officials in recent weeks.
Kamala Harris in Seoul
U.S. Vice President Kamala Harris was in Seoul on Thursday where she met South Korea's President Yoon Seok-yeol, to discuss the concerns faced by South Korean automakers.
A White House readout following the two leaders' meeting said the U.S. vice president understood the raised concerns and that both pledged to "continue to consult" on the matter.
Yoon's office cited Harris as saying she would "look into ways to relieve South Korea's concerns in the process of enforcing the law," according to a statement on the same meeting.
Breach of WTO rules?
South Korean and European officials have said the tax credit provisions in the IRA are a breach of rules under the World Trade Organization, Reuters reported.
We are disappointed to see in particular this provision [was] included in the IRA without much prior consultations.
Ahn Duk-geun
trade minister, South Korea
South Korea's industry ministry confirmed with CNBC that Seoul will be reviewing whether to file a formal complaint to the WTO over such concerns.
Last week, the Korean Confederation of Trade Unions, which represents workers from South Korean domestic companies including Kia and Hyundai, slammed the U.S. measures as "unilateral" and "U.S.-centric," and said they could worsen the uncertainties surrounding the current state of the global economy.
China is 'important trading partner'
Ahn noted that South Korea's export-reliant economy is indeed "experiencing the decoupling phenomenon" as a result of heightened U.S.-China trade tensions. He did not elaborate further.
South Korea is facing a continued trade deficit problem due to a rise in energy prices, and that Beijing holds a strategically significant role for the country, he added.
"China is still [a] very important trading partner of Korea," Ahn said.
"I think the stabilization of this trade relationship will play a very important role to secure the global supply in these turbulent and uncertain economic circumstances." | 2022-09-29T10:29:34Z | www.cnbc.com | U.S., South Korea working to rectify problems on EV subsidies: Korea minister | https://www.cnbc.com/2022/09/29/us-south-korea-working-to-rectify-problems-on-ev-subsidies-korea-minister.html | https://www.cnbc.com/2022/09/29/us-south-korea-working-to-rectify-problems-on-ev-subsidies-korea-minister.html |
The economy faces a heightened risk of a recession, Ford (F) CEO Jim Farley told CNBC on Tuesday, a week after the automaker warned investors of $1 billion in unexpected supplier costs and parts shortages in the third quarter. But the Club is sticking with Ford because we believe it has what it takes to navigate macroeconomic headwinds and supply disruptions. "The risk has gone up for a moderate recession certainly from all the indicators we've seen," Farley said. "For us as a business we see labor inflation, a lot of input costs are going up. We're doing our best to overcome them...and we have a big job to do on costs specific to Ford anyways," he added. The chief executive of Club holding Ford also discussed improvements in its chip shortage, even as he warned the company could face supply chain disruptions through next year. While Ford shares have undoubtedly come under pressure β the stock is down more than 40% year-to-date β the Investing Club is taking a long-term view on our Ford investment and is not shaken by what appear to be short-term constraints. Jim Cramer said Wednesday he won't sell Ford here. "I find this a little absurd, frankly, because there have been problems the whole way around, but what matters is demand. If you sell Ford here, you're selling it at a 5% yield," he added. Earlier in the week, Jim said that investors who don't own any shares of Ford should buy "aggressively" to take advantage of the yield . Ford last week said it anticipates third-quarter adjusted earnings before interest and taxes (EBIT) to be between $1.4 billion and $1.7 billion, well below the $2.99 billion estimate predicted by analysts, even as it reaffirmed a full year operating profit forecast of $11.5 billion to $12.5 billion. The automaker has been working on restructuring company costs to stay ahead of the competition to produce electric vehicles, an area that is expected to increase future operating margins. Supply chain pressure Last week, shares of Ford suffered their worst day in more than 11 years , when the company announced persistent part shortages. In its earnings preview, Ford said it expects to have 40,000 to 45,000 unfinished vehicles by the end of the third quarter that will have to be sold down the line. "I think it's going to take a while β it could easily take through next year, and demand would have to fall way off for us to have the demand side solve this problem," Farley said. Consumer demand has remained strong for Ford's popular product line up, compounding the company's production challenges. "We have a multiyear order bank now for our commercial vehicles," the CEO noted. In light of Ford's revised production outlook, Citi lowered its price target for Ford shares to $13 from $16. In a research note Tuesday, the bank said it was revising downwards its adjusted EBIT estimate for the full year, to $11.5 billion from a previous estimate of $11.8 billion, citing a difficult macroeconomic backdrop, international exposure and higher cost headwinds. But the bank still sees the automaker's fundamentals as "macro resilient." Ford, which has said it's committed to ramping up production, recently announced a $700 million manufacturing investment in Kentucky that is expected to create 500 manufacturing jobs to support new vehicle production. Chips shortage Despite the ongoing supply chain challenges, Farley said the automaker's chip shortage is improving. Indeed, the parts shortage in question is not chips-related, which makes us think the automaker has more control over production than investors realize, and can make up for missed sales in future quarters. "We're seeing the chips situation get better. It's not enough to supply the industry needs or what customers want to buy, but it's getting better," Farley said. "What's really happening now is different. In the last quarter we started to see supply chain issues on non-chip issues." (Jim Cramer's Charitable Trust is long F. See here for a full list of the stocks.) β Correction: This story has been updated to reflect that Ford shares one day last week suffered their worst session in more than 11 years. As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED. | 2022-09-30T04:37:33Z | www.cnbc.com | Ford's fundamentals remain strong, despite recession worries, productions snags | https://www.cnbc.com/2022/09/28/ford-ceo-farley-sees-risk-of-recession-amid-inflation-and-supply-disruptions-.html | https://www.cnbc.com/2022/09/28/ford-ceo-farley-sees-risk-of-recession-amid-inflation-and-supply-disruptions-.html |
But there's nothing wrong with having an introverted personality β and it certainly doesn't mean you're less cut out for a successful career, Allen says. She cites Mark Zuckerberg, Bill Gates and Warren Buffett as examples, noting that introvert strengths often include quality listening, effective problem solving and the ability to avoid impulsive decisions.
Allen recommends writing down your affirmations in a journal, an index card or even somewhere on your phone. Read them as often as possible, especially when you're having negative thoughts. The result, she says: You'll start to carry yourself with more confidence, and that will only draw more people to you. | 2022-09-30T04:39:47Z | www.cnbc.com | Expert networking tips for introverts from coach Jevonya Allen | https://www.cnbc.com/2022/09/29/expert-networking-tips-for-introverts-from-coach-jevonya-allen.html | https://www.cnbc.com/2022/09/29/expert-networking-tips-for-introverts-from-coach-jevonya-allen.html |
Hurricane Ian is a reminder for all homeowners to check their insurance for coverage of natural disasters
Ian slammed into Florida's southwestern coast Wednesday as a Category 4 hurricane, causing widespread flooding and wind damage.
If you own your home, whether it's in an area prone to hurricanes, tornadoes, flooding, hail or wildfires, it's important to know what your insurance covers and excludes.
Flood insurance generally needs to be obtained separately.
Insurance deductibles for weather-related damage are often a percentage of your home's insured amount, regardless of the cost of the damage.
If you're far from the destruction caused by Hurricane Ian in Florida, you may be thanking your lucky stars that your home wasn't in the storm's path.
If you're a homeowner, whether you live in an area prone to hurricanes, tornadoes, flooding, hail, wildfires or severe storms β all of which seem to be becoming more prevalent amid a warming climate β it's important to know which types of weather-related damage your homeowners insurance covers, excludes or charges a separate, and likely higher, deductible for.
Ian was downgraded to a tropical storm Thursday after slamming into Florida's southwestern coast Wednesday as a powerful Category 4 hurricane with sustained winds of about 150 mph. The storm could regain hurricane strength as it heads into the Atlantic Ocean and then back toward the southeastern U.S. coastline, according to the National Hurricane Center.
Either way, those amounts typically range from about 1% to 5%, with a minimum of $500, depending on the specifics of your insurance. Some homeowners might opt for an even higher deductible if it's available.
More than 2 million without power after Hurricane Ian slams into Florida
Also, earthquakes are not covered by standard homeowners policies, even in quake-prone California β you'd have to purchase separate insurance β nor, typically, are other types of earth movement, i.e., landslides, sinkholes.
Those homeowners will be able to apply for grants from the Federal Emergency Management Agency, but the amount typically covers only part of the homeowner's loss. For instance, after 2017β²s Hurricane Harvey, which dumped as much as 60 inches of rain in some spots in Texas, the average FEMA grant for individuals was $7,000, while the average claim through the National Flood Insurance Program was more than $100,000.
You can get coverage either through a private insurer or through the federal program, which is how most homeowners get a policy. There are exclusions and limitations on what is covered, however. And, other than a few exceptions, policies take 30 days to become effective. | 2022-09-30T04:40:38Z | www.cnbc.com | Hurricane Ian is a reminder for all homeowners to check insurance | https://www.cnbc.com/2022/09/29/hurricane-ian-is-a-reminder-for-all-homeowners-to-check-insurance.html | https://www.cnbc.com/2022/09/29/hurricane-ian-is-a-reminder-for-all-homeowners-to-check-insurance.html |
Jan. 6 Capitol riot committee interviewed Ginni Thomas, wife of Supreme Court justice
The House select committee investigating the Jan. 6 Capitol riot interviewed Virginia Thomas, the wife of Supreme Court Justice Clarence Thomas.
Virginia Thomas, who goes by Ginni, was reportedly involved in efforts to challenge the 2020 presidential election results and communicated with Trump administration officials about those efforts.
Virginia Thomas, conservative activist and wife of Supreme Court Associate Justice Clarence Thomas, leaves for a break during a closed-door meeting with House Select Committee to Investigate the January 6th Attack on the U.S. Capitol, on Capitol Hill September 29, 2022 in Washington, DC.
A House select committee on Thursday interviewed Virginia Thomas, the wife of Supreme Court Justice Clarence Thomas, as part of its investigation into the Jan. 6 Capitol riot.
Virginia Thomas, who goes by Ginni, arrived at a Capitol Hill office building flanked by security and spoke with the committee for about 3.5 hours, NBC News reported.
Thomas did not answer any questions reporters asked upon her arrival or during the three breaks she took throughout the day, NBC reported. "Thank you for being here," she said in the morning in response to one question, a CNN video showed. "Thank you for your question," she replied to another.
Reports have indicated that Thomas was involved in efforts to challenge the 2020 presidential election results and discussed those efforts with Trump administration officials.
Thomas left the building around 2 p.m. ET, according to NBC.
Her attorney, Mark Paoletta, said in a statement after the interview that Thomas "was happy to cooperate with the committee to clear up the misconceptions about her activities surrounding the 2020 elections. She answered all of the committee's questions."
"As she has said from the outset, Mrs. Thomas had significant concerns about fraud and irregularities in the 2020 election," Paoletta's statement said. "And, as she told the Committee, her minimal and mainstream activity focused on ensuring that reports of fraud and irregularities were investigated."
NBC reports House Jan. 6 committee will interview Ginni Thomas, wife of SCOTUS Justice Clarence Thomas
"Beyond that, she played no role in any events after the 2020 election results. As she wrote in a text to [Trump White House chief of staff] Mark Meadows at the time, she also condemned the violence on January 6, as she abhors violence on any side of the aisle," Paoletta said.
A spokesman for the committee declined CNBC's request for comment on the interview. A spokeswoman for the Supreme Court did not respond to an email requesting comment.
The committee was scheduled to hold its ninth public hearing this week but postponed it due to Hurricane Ian, the major storm that was approaching Florida at the time. | 2022-09-30T04:41:03Z | www.cnbc.com | Ginni Thomas, justice's wife, interviewed in probe of pro-Trump Jan. 6 Capitol riot | https://www.cnbc.com/2022/09/29/jan-6-capitol-riot-committee-to-interview-ginni-thomas-wife-of-supreme-court-justice-on-thursday.html | https://www.cnbc.com/2022/09/29/jan-6-capitol-riot-committee-to-interview-ginni-thomas-wife-of-supreme-court-justice-on-thursday.html |
U.S. panel manufacturer First Solar is uniquely positioned to benefit from the recently passed Inflation Reduction Act, Evercore ISI said as it upgraded the stock to an outperform rating. "First Solar is well positioned to benefit from the Inflation Reduction Act, from both the increased demand side and the supply side benefits," the firm said Wednesday evening in a note to clients. The IRA is the largest climate bill in U.S. history and includes incentives aimed at spurring renewable energy buildout in the country and encouraging domestic manufacturing. Evercore's analysts led by Sean Morgan noted that First Solar can take advantage of both, given that it's the largest β and one of the few β U.S. manufacturers. At the end of August the company announced a new U.S. factory, with CEO Mark Widmar telling CNBC that the IRA was the key catalyst that made First Solar choose the U.S. for the new site. The newly announced plant β the exact location of which has yet to be announced β will be the solar company's fourth fully integrated U.S. factory. Shares of First Solar have gained nearly 80% since July 27 when Senate Majority Leader Chuck Schumer, D-N.Y., and Sen. Joe Manchin, D-W.V, said they reached an agreement on a climate package. The stock has largely avoided the widespread selling taking place in the broader market. Shares have roughly doubled in price since late June. The Invesco Solar Fund , which tracks the space, has largely given up its gain since July 27 β up just 1% after initially surging into August. Evercore's Morgan also significantly raised his target on the stock from $88 to $150. However, the new forecast is only about 13% above where the stock traded Thursday. The firm added that given First Solar's domestic footprint the company could benefit from trade restrictions on Chinese solar modules. "In our view, First Solar, which faces cost competitive competition in solar panels in the U.S. and the EU, from Chinese and China adjacent Asian countries, would benefit from increased trade barriers to foreign Chinese competition," Morgan said. Evercore is not the only Wall Street firm to note the benefits for First Solar from the IRA. Earlier in September, Goldman Sachs upgraded the stock to a buy rating . "On the demand front, we see FSLR as one of the best levered to US demand tailwinds within our solar panel supplier coverage as the US accounts for roughly 80% of the company's revenue," the firm said in a Sept. 7 note to clients. Shares of First Solar dipped more than 2% Thursday. - CNBC's Michael Bloom contributed reporting. | 2022-09-30T04:42:22Z | www.cnbc.com | Shares of First Solar have nearly doubled in 3 months, but Evercore ISI says there's more upside | https://www.cnbc.com/2022/09/29/shares-of-first-solar-have-nearly-doubled-in-3-months-but-evercore-isi-says-theres-more-upside.html | https://www.cnbc.com/2022/09/29/shares-of-first-solar-have-nearly-doubled-in-3-months-but-evercore-isi-says-theres-more-upside.html |
Warren Buffett buys more Occidental Petroleum after shares slide 18% in one month
Warren Buffett's Berkshire Hathaway bought the dip in Occidental Petroleum , continuing to add to its massive stake as the legendary investor remains unfazed by the pullback in oil prices. The conglomerate added about 6 million shares of the oil giant, worth approximately $350 million, from Monday to Wednesday, paying as much as $61.37 per share, according to a regulatory filing released Wednesday evening. Berkshire's stake in Occidental has now reached 20.8% after steadily increasing the bet over the past few months. In August, Berkshire received regulatory approval to purchase up to 50%, spurring speculation that it may eventually buy all of Houston-based Occidental. Shares of Occidental retreated 18% over the past month as of Wednesday's close as oil prices dropped on rising recession fears. Meanwhile, there were also demand worries out of China, the world's largest crude importer. The ongoing lockdowns in the country have sparked fears that fewer oil and petroleum products will be needed to power its economy. Goldman Sachs "significantly" cut its oil price forecasts Tuesday amid fears of slowing economic growth. The Wall Street investment bank now expects West Texas Intermediate crude to average $95 per barrel during the fourth quarter of 2022. On Wednesday, the contract traded around $82 per barrel. Still, Occidental is the best-performing stock in the S & P 500 in 2022, up more than 110%. Retail investors also followed Buffett's lead, pushing shares higher. Berkshire also holds warrants to buy another 83.9 million common shares for $5 billion, or $59.62 each. The warrants were obtained as part of the company's 2019 deal that helped finance Occidental's purchase of Anadarko . The Berkshire stake in Occidental would rise to 27.4% if it exercised those warrants. Some Buffett watchers expect even more buying if Occidental pulls back. "That happens to be where his purchases in early August were also made, and we'd expect to see more of this the next time OXY dips," Don Bilson of Gordon Haskett said in a note. | 2022-09-30T04:43:41Z | www.cnbc.com | Warren Buffett buys more Occidental Petroleum after shares slide 18% in one month | https://www.cnbc.com/2022/09/29/warren-buffett-buys-more-occidental-petroleum-after-shares-slide-18percent-in-one-month.html | https://www.cnbc.com/2022/09/29/warren-buffett-buys-more-occidental-petroleum-after-shares-slide-18percent-in-one-month.html |
The Federal Reserve's response to inflation is coming under intense scrutiny once more as investors grapple with a worsening economic outlook and a stock market that's now in bear market territory. Concerns are mounting that the U.S. economy is now paying the price for a Fed that has been caught far behind the curve. After initially characterizing pandemic-era inflation as "transitory," Fed Chair Jerome Powell eventually conceded in November last year that it's "probably a good time to retire that word." The central bank has raised its federal funds rate up to a range of 3% to 3.25% since March. Earlier this month, it signaled its intention to raise interest rates as high as 4.6% in 2023 to control inflation. The Fed's dot plot also showed that central bank officials expect to hike rates to 4.4% by the end of 2022. 'Too much too soon' Yet, despite the Fed raising its guidance, calls are growing for the central bank to slow its pace of rate hikes amid rising warnings that economic growth could grind to a halt. "I think the Fed has to be really careful here. If they keep going without pausing, it's really going to create a real possibility of a significant recession," Ed Yardeni, president of Yardeni Research, told CNBC " Squawk Box Asia " on Wednesday. "The Fed has to recognize that not only are they restrictive in terms of raising interest rates β¦ and on top of that, they picked up the pace of they quantitative tightening, which means reducing the securities on their balance sheet. All that has led to a very strong dollar," he added. While the Fed's latest guidance implies yet another 75 basis point hike at its November meeting, Yardeni said he believes it's "too much too soon." He believes inflation is "starting to come down," which should convince the Fed they should "cool [the rate hikes] for a little while before it turns more hawkish." Are 'bond vigilantes' back? Yardeni said a mix of monetary tightening and fiscal stimulus has led to the return of "bond vigilantes." The veteran economist has been credited with coining the term "bond vigilantes" in the 1980s β which refers to bond market investors who sell a large amount of bonds to protest against rising inflation and to demand higher yields on their bond holdings. His comments came as the worst bond sell-off in decades is seeing few signs of abating. U.S. Treasury yields have been on a tear, as traders digest comments from several Fed speakers earlier in the week that suggested more rate hikes ahead. The benchmark 10-year Treasury yield briefly topped 4% in Wednesday trading in New York, before falling 25 basis points to yield 3.705% β the biggest decline since 2020 β after the Bank of England announced a bond-buying plan to stabilize British markets. It was trading at a yield of 3.8461% in Thursday afternoon trading in Asia. | 2022-09-30T04:44:18Z | www.cnbc.com | Economist Ed Yardeni reveals what the Federal Reserve should do next | https://www.cnbc.com/2022/09/30/economist-ed-yardeni-reveals-what-the-federal-reserve-should-do-next.html | https://www.cnbc.com/2022/09/30/economist-ed-yardeni-reveals-what-the-federal-reserve-should-do-next.html |
Subsets and Splits
No community queries yet
The top public SQL queries from the community will appear here once available.