Nasdaq Markets Outlook

A mostly graphical daily curated roundup of the markets and the economy from Nasdaq's IR team.

| 1685: Germany establishes the second stock exchange in the world (Amsterdam being the first!)

| concerns with commercial real estate still remain on the forefront. "Foreclosures are surging in an opaque and risky corner of commercial real-estate finance, offering one of the starkest signs yet that turmoil in the property market is worsening." -WSJ

| big event of this week: tomorrow's US CPI release | "Is 3 the new 2? ... there’s some tentative evidence of core inflation settling around 3%. There’s some concern about this at the Fed too, with Dallas Fed President Logan echoing these thoughts last week" -Jim Reid, Deutsche Bank

* source: Jim Reid, Deutsche Bank

| "We have seen dramatic differentiation in performance in both the size and style trades this year. In the S&P benchmarks, large has outpaced small by over 15% and growth over value by 10%." -Piper Sandler

| 2023 = #QualityMatters market | "In uncertain markets investors typically seek out the relative safety of stocks with strong fundamentals (i.e. quality). For example, within both small caps and value benchmarks, quality factors have significantly outperformed this year" -Piper Sandler

* source: Piper Sandler

| Cash: "still attracting biggest inflows & on course for record $1.4tn in '23" -BofA

* source: BofA's Michael Hartnett, The Flow Show

| Last week: tech + communications outperformance / Defensives (HC, Staples, Utes) + Energy + Small Caps (R2K) underperformers...

* source: Factset, created by Gavin Zaentz

* source: Piper Sandler

| How long will sentiment remain poor for a contrarian buying environment? Markets currently cheering the end of rate hikes as yields soften...but a sustained rally needs a strong economy with earnings expanding

* source: BofA

| Just How Bad Is the IPO Market? Really Bad. Companies see few reasons to rush to publicly list shares, with recent IPOs trading lower. -WSJ

* source: CNBC

| Worsening economic outlook weighs on consumer sentiment University of Michigan's preliminary consumer sentiment index fell to 60.4 in November from 63.8 ... rise in consumer inflation expectations, despite falling gas prices, will be concerning to the Fed

-Oxford Economics

* source: Oxford Economics

| Consumer confidence still strong (sentiment weak) as job market still tight...

* source: Oppenheimer Asset Management, John Stoltzfus

| where we are in the cycle...?

* source: Piper Sandler, Michael Kantrowitz

1) KEY TAKEAWAYS

1) Equities LOWER | Oil + Dollar + TYields HIGHER

THEMES: Elevated Q3 earnings beat rates + stable 2024 earnings estimates | Equity bounce on the back of a meaningful rate reprieve as softer macro data = bad news is good news | Seasonality and Buybacks = better momentum for market | Recession signaling from yield curve now steepening? | Continued geopolitical uncertainties | Broader indices trading above key moving averages, how long can this last? | Consumers showing signs of weakness | Money starting to flow back into markets from money market funds = more risk taking environment | Busy week of Fedspeak | Weak 30 YR Treasury Auction | Hawkish Fed Speak = Powell said “he’s not confident” it has done enough to bring inflation down. | rising default rates

-by Shon Wilk

DJ -0.2% S&P500 -0.5% Nasdaq -0.7% R2K -0.7% Cdn TSX -0.1%

Stoxx Europe 600 +0.4% APAC stocks MIXED, 10YR TYield = 4.686%

Dollar HIGHER, Gold $1,934, WTI +1%, $78; Brent +1%, $82, Bitcoin $36,670

* source: Goldman Sachs Global Investment Research

2) "Labor market data over the coming months will be key, as they will help determine, in part, the path for earnings ahead." -JP Morgan Asset Management | labor market has been softening but still strong...

* source: JPM AM

3) Recent movements...

* source: Oppenheimer Asset Management, John Stoltzfus

4) THIS WEEK:

US = CPI + retail sales reports .

UK = inflation and labour market indicators. growth data in Japan and China.

"Apart from economic data, a potential US government shutdown and US-China relations at the APEC economic leaders' week will be in focus. Notable corporate earnings include Walmart, Cisco and Alibaba." -Deutsche Bank

* source: Barclays' Emmanuel Cau

2) ESG, COMPILED BY NATHAN GREENE

OFF TODAY

3) MARKETS, MACRO, CORPORATE NEWS

• Is the stock market rally about to rev up?-WSJ
• It’s a Treasury Bond world. The Stock Market just lives in it.-BAR
• US bank stocks sink to all-time low against S&P 500-FT
• Investors shake up VC market by raising money to buy out start-ups-FT
• A $20 billion week marks market reopening for EM Bond sales-BBG
• Traders say UK inflation risks undoing aggressive rate-cut bets-BBG
• US shutdown risk eased in stopgap plan offered by Johnson-BBG
• Third-party candidates pose new threat to Biden re-election bid-FT
• US credit-rating outlook changed to negative by Moody’s-BBG
• The low-wage pay surge is over, threatening the consumer boom-MSN
• Copper market slump threatens shift to wind power, electric cars-WSJ
• Benjamin Netanyahu rules out return of Palestinian Authority in Gaza-FT
• Novo Nordisk’s obesity drug cuts risk of death by 18%, trial data shows-FT
• Semaglutide and Cardiovascular outcomes in Obesity without Diabetes-NEJM
• Exclusive: Google in talks to invest in AI startup Character.AI-RTRS
• Wendel seeks further private equity deals after IK partners investment-FT
• Telecom Italia boss defends KKR deal as only way to secure group’s future-FT
• Exclusive: Exxon aims to begin lithium production by 2026 in Arkansas-RTRS
• Turkish air order splash pushes Dubai show into record territory-BBG
• China weighs ending freeze on Boeing with 737 Max deal in US-BBG
• TotalEnergies nears deal to buy Texas Gas Power Plants-BBG
• Farage to seek millions in damages from NatWest and former CEO Rose-SKY
• Boeing closes in on major deal with Emirates for 777x Jets-BBG
• $29 flights are back as airlines race to fill seats in the off-season-CNBC
• Shipping shifts from jackpot to job cuts after $364 billion boom-BBG
• Top four US banks grab a growing share of industry’s profits-FT

Oil/Energy Headlines: 1)  Iraq expects deal to resume Kurdistan oil output within three days-RTRS 2) US drillers cut oil rigs to lowest since Jan 2022 for second week-Baker Hughes-RTRS 3) Geopolitical risks worst in 50 years, warns oil services boss-FT 4) Prasad: Saudi Oil cuts to remain until year end-BBG