Wealth Wednesday
Ranora Daily - Your daily source for reliable market analysis and news.
Market Data
Local
Global
*Data as of 4pm WAT
Market News
Local
Lagos State, Afreximbank sign $1.35bn facility for infrastructure - BusinessDay
Lagos State and the African Export-Import Bank (Afreximbank), supported by Access Holding Plc on Monday signed a deal for a $1.35 billion facility for infrastructure and food security in the State.
Global
Wages boost US labor costs, house price inflation picks up - Reuters
U.S. labor costs rose solidly in the third quarter due to strong wage growth, while house price inflation accelerated in August, signaling continued inflationary pressure and making it likely that the Federal Reserve will maintain its current high interest rates. The Employment Cost Index (ECI) showed labor costs increased by 1.1% in the last quarter.
Record-high US oil production surpasses 13M barrels a day - Bloomberg
US oil production has reached a new record, surpassing 13 million barrels a day, which exceeded the previous high set in November 2019. In August, the US produced a record 13.05 million barrels per day, as reported by the US Energy Information Administration in their monthly update.
Musk says Tesla aims to make 200,000 Cybertrucks a year - Reuters
Tesla's CEO, Elon Musk, announced the company's aim to produce approximately 200,000 units of its Cybertruck electric pickup truck annually. This figure is higher than their earlier projection of more than 125,000 trucks per year, with potential to reach 250,000 by 2025.
Weekly Investment Watchlist
Market Commentary:
Asia and Australia:
Asian equities traded mostly higher on Wednesday in a subdued session, with the region led higher by a strong surge in Japan following the BOJ’s recent moves. In Greater China, markets were mixed as Shanghai gained, while Hong Kong rallied to the flatline. There were strong gains in Seoul and modest gains for Taipei, while Australia had a strong trading day.
The People’s Bank of China drained a net of 109 billion yuan ($14.9 billion) from money markets on Wednesday by doling out a smaller amount of new short-term loans than was maturing. This move came during a month-end funding demand. At one point, the overnight rate had surged to as high as 50% in isolated transactions on Tuesday. However, the PBoC dismissed this as a one-time phenomenon.
China’s Caixin Manufacturing PMI number dropped to 49.5 in October, versus the consensus of 50.8 and 50.6 in the prior month. This put it back into contractionary territory after experiencing expansion in August and September. The decline was attributed to a fresh fall in production amid slower growth in overall sales, which was dampened by weak foreign demand. This Caixin survey covers a narrower range of companies and more export-oriented companies, reflecting a decline in activity, with new export orders falling for four months in a row.
Asia’s manufacturing activity showed mixed results in October as cost pressures began to rise again, particularly in oil:
South Korea’s reading came in at 49.8, slightly down from 49.9, but the production outlook improved.
Taiwan’s PMI stood at 47.6, up from 46.4, marking the slowest contraction since March.
Thailand’s PMI was 47.5, down from 47.8 in September.
Vietnam’s PMI was 49.6, down from 49.7.
Malaysia’s PMI remained unchanged at an eight-month low of 46.8.
Indonesia’s PMI also reached an eight-month low, but it remained in expansionary territory at 51.1.
India’s PMI unexpectedly declined but was still in expansionary territory, at 55.5, down from 57.5.
Europe, Middle East, Africa:
European equity markets traded slightly higher, although they retreated from their peak levels, following a mostly positive close on Wednesday.
In the UK, the Nationwide measure of house prices unexpectedly increased in October, with a 0.9% rise, which contrasted with expectations for a 0.4% drop and an unchanged reading in September. Year-on-year, there was a drop in prices to 3.3% from the previous 5.3%. This acceleration doesn’t align with what the BoE would like to see before their rate decision, as a cooling housing market is imperative for them to hold. However, it is doubtful that this will change their decision for tomorrow.
The UK’s manufacturing PMI was revised down to 44.8, as compared to the flash estimate of 45.2 and the previous 44.3. Manufacturing activity remains entrenched at weak levels, with possible signs of stabilization following eight consecutive months of production decline.
The Americas:
WeWork filed for bankruptcy, leading to a 42% fall in its share price in pre-market trading. Prior to the initial IPO attempt, the company was valued at $47 billion.
Paycom’s stock plunged 32% as the payroll company downgraded projections. The company now expects $420 million to $425 million in revenue for the fourth quarter, while analysts were modeling $452 million.
Spirit AeroSystems on Wednesday cut its full-year forecast for 737 fuselage deliveries, one of its most prominent programs, as it grapples with a production defect involving improperly drilled holes on the aft pressure bulkhead. They now expect to deliver 345 to 360 narrow body fuselages in 2023, compared to their prior forecast of 370 to 390 units.
The Week Ahead:
Monday:
Tuesday:
US Employment Cost Index q/q rose 1.1% quarter-over-quarter (q/q, 4.4% annualized)
US CB Consumer Confidence decreased from 103 in September to 102.6 in October
Wednesday:
ADP Non-Farm Employment Change (US)
ISM Manufacturing PMI (US)
JOLTS Job Openings (US)
Federal Funds Rate (US)
Thursday:
BOE Monetary Policy Report
Unemployment Claims (US)
Friday:
Average Hourly Earnings m/m (US)
Non-Farm Employment Change (US)
Unemployment Rate (US)
ISM Services PMI (US)
Investment Tip of The Day
Assess Industry Disruptors: Industries are subject to disruption from innovative technologies or business models. Identify companies that are positioned to adapt and thrive in changing landscapes.
Meme of the Day
