Fed Minutes, JOLTS, ISM, China Tech Hope
By Geoffrey Smith
Investing.com — The Fed will release minutes of its final policy meeting in December, while we look at the first big US data of the year in the form of the December ISM Manufacturing survey and Labor Department work. Request for ads for November. In Washington, we’re witnessing a whole new stalemate with MAGA’s Republicans and Freedom Caucus blocking Kevin McCarthy’s bid for House Speaker. China’s GDRs rise after signs that the Communist Party is easing pressure on the sector. U.S. stocks edged lower on Tuesday after Tesla-inspired declines. Oil fell to a two-week low amid global demand fears. Here’s what you need to know in the financial markets this Wednesday, January 4.
1. Fed minutes will follow JOLTS and ISM numbers
The United States presents the first big data of the year, the final policy meeting of the Federal Reserve at 20:00, the climax of the day, which will also include the monthly survey and l ‘Institute for Supply Management.
The minutes should help gauge how confident Fed officials are about the need to maintain high levels if inflation continues to fall, as many expect. – as many expected – continues its downward trajectory this year. The JOLTS and ISM numbers – both due at 4pm – should tell us a little more about the reality of hoping for a quick and painless inflation process.
Weekly credit and interest information is also due at 1:00 p.m., as usual.
2. Deadlock at home
For the first time in 100 years, the House of Representatives of the US Congress is paralyzed because it cannot elect a president. Kevin McCarthy failed to win a majority in three separate votes thanks to a handful of right-wing opponents within the Republican Party who considered him too close to the mainstream consensus in Washington.
The 20 dissenters mostly come from the Freedom Caucus, the ultra-conservative group that nominated Jim Jordan for House speaker, though Jordan insists he doesn’t want the job.
There was no sign of compromise from either side of the GOP on Tuesday, leaving few clues as to when the Capitol might begin crafting the legislation.
3. Stocks are poised to rise slightly; Tesla overshadows events
U.S. stock markets are set to open slightly higher after Tuesday’s losses, fueled by fears of two of the market’s biggest heavyweights.
It was up 93 points or 0.3%, 0.4% and 0.6% at 1:20 p.m. The three major money indexes lost between 0.1% and 0.8% on Tuesday.
Tesla’s (NASDAQ: ) plunge of 12.4% — a reaction to missing deliveries in the fourth quarter — was the biggest daily decline in more than two years, reflecting fears of growing demand for its vehicles. Apple’s (NASDAQ: However, it reflects broader fears about demand for gadgets in general after years of stimulative demand.
Other stocks to watch include Tesla rival Rivian (NASDAQ: ), which missed delivery targets for the fourth quarter.
4. China ADRs rise after regulators allow Ant Group to raise capital
Chinese stocks continued to rally on signs that the government is following through on promises to ease the tech sector.
Hong Kong’s index rose to a five-month high after the country’s securities regulator gave Ant Group permission to raise capital. Regulators blocked Ant Group’s IPO in 2020 at the start of a wide-ranging crackdown that asserted the supremacy of politics over business in the communist-ruled country.
ADRs Ali Baba A subsidiary of Ant Group (NYSE: ), the same man – Jack Ma – who shares some of his political risk as he founded both companies, rose 7.0% in premarket trade, while ADR Pinduo-duo (NASDAQ: ) and JD.com (NASDAQ: ) also rose. Tencent (HK 🙂 , another tech giant that has faced heavy regulatory pressure in the past year, rose 4.6% in Hong Kong.
5. Oil Hits Two-Week Low on Demand Fears; API numbers are pending
Crude oil prices fell to their lowest level in two weeks as fears about the global economic outlook added to a short-term oversupply caused by the week’s storms in the United States. Oil futures were down 2.6% at $74.95 a barrel at 1:30 p.m., while U.S. crude futures were down 2.6% at $80.00, trading below that level for much of the European morning.
Italy will release weekly inventory data as usual at 10:30 p.m., which is expected to show the impact of drivers who were kept at home by last week’s bad weather.
Although oil prices have stabilized, they have reached their lowest level in the last 11 months. Demand for US gas is expected to remain strong, as evidenced by an overnight Reuters report that Tokyo Electric Company is in talks to buy gas producer Rockcliff Energy for $4 billion.