All Is Calm Ahead Of The Federal Reserve This Afternoon

Good Morning Everyone!

Remember, today at 2pm, a group of middle-aged financial experts determines whether or not millions of Robinhood traders get margin called.

 


Prices as of 4 pm EST, 11/1/22; % YTD


MARKET UPDATE

2 p.m. Fed Reserve Rate decision

  • Volatility is relatively LOW heading into the Fed Meeting

  • 4th straight rate hike of 75 basis points expected

  • More important: messaging on how the Fed proceeds from here

  • 2:30 p.m. Powell press conference

  • Will Powell say: we are not done

  • Powell can’t be happy about the spectacular rally in the DOW in October / this is not what Powell wants

China orders a 7-day lockdown of iPhone City (Foxconn’s main plant in Zhengzhou)

  • Foxconn had a Covid flare-up that forced 200,000 staff into quarantine

  • Lockdown will last until November 9

  • The abrupt action reflects Beijing’s Covid Zero approach

  • Apple AAPL pre-market is down 1%

Russia

  • said it would resume participation in the Ukrainian grain deal

  • Wheat down 6%, Corn down 2%

Crude 88 flat

  • API Crude and product inventories out last night had little impact on Crude

  • Fed Day is more important

Maersk container vessels

  • A bellwether for global trade

  • Believes global demand will shrink by 4% in 2022 and will be down in 2023

Amazon AMZN hit a new year-to-date low yesterday

  • Amazon paused hiring in their Ad business

  • Any cost cutting measures will be viewed positive by investors

Autos

  • U.S. supply 32 days 18 month high

  • U.S. SAAR 15.3 million units 17 month high

  • Incentives were down 47% year-over-year but up 2.7% month-over-month

  • Inventory days supply is 32 days vs. 30 days last month and 23 days last year

  • Mix remains strong favouring trucks: Car vs. light truck mix at 21% / 79%

Opioid Settlement

  • Final settlement positive for pharmacies

  • $12-13.8 billion for the big three retail pharmacies

  • $21 billion announced in 2021 for the big 3 distributors

  • CVS CVS + 2%

  • Walgreens Boots Alliance WBA +2%

  • Walmart WMT flat

Earnings

  • Advanced Micro Devices AMD

  • Mondelez MDLZ

  • Airbnb ABNB beat but guide below street

  • McKesson MCK

  • Public Storage PSA

  • Devon Energy DVN Earnings and FCF beat, capex below consensus

  • AIG AIG EPS beat

  • Prudential PRU EPS beat

  • Energy Transfer ET

  • CVS Health CVS agreed to pay $5 billion to settle opioid lawsuits

  • Estee Lauder EL -8%, guide down to 2023

  • Progressive Insurance PGR

  • Humana HUM

CRYPTO UPDATE

International regulation

  • G-20 will prioritize crypto regulation

    • Third objective of India’s G-20 presidency

    • Year-long presidency

    • Takes over starting in December

  • Hong Kong warming up to crypto

    • Exploring giving access to retail crypto trading and ETFs

    • Considering range of pro-crypto measures

    • Mainland China much more strict

      • Blanket ban on all crypto in September 2021

Recent crypto trademark filings

  • Visa V

  • PayPal PYPL

  • Western Union WU

  • Viking Cruises

  • Ulta ULTA

  • Del Monte FDP

  • Kraft KHC

  • Inn-N-Out

  • Takis

  • Moët Hennessy

  • Formula One

  • DraftKing DKNG

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