Nasdaq Markets Outlook

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

| “Differences among states are driving businesses to pack up for better climes. Nearly 150 publicly traded companies moved their headquarters across state lines in 2022, the highest rate in the past six years. Top destinations were Florida, Texas, Arizona and Utah."

-The Wall Street Journal Editorial Board

| prospect of lower yields (well on lower growth) pushing markets higher | "we’ve had 8 successive up days for the S&P 500...a 9-day run has happened 31 times in the last 95 years it actually hasn’t happened since 2004." -Deutsche Bank, Jim Reid

* source: Deutsche Bank, Jim Reid

rate cuts? / falling yields = cynically supporting equities

BUT...some investors worry further declines in yields could keep Fed in a hawkish stance for longer -RTRS

* source: Piper Sandler

"There is no one-size fits-all approach to Fed easing cycles"

* source: Piper Sandler

economic data surprises falling across the board...

* source: Goldman Sachs Global Investment Research

| some concerns about the retail sector? | “Real consumer spending is set to decline, under the weight of tighter lending standards, and surging interest payments.”

* source: Piper Sandler

| gauges of global growth: copper + industrial commodity prices have also been falling as of recent

* source: Yardeni Research

| "we’ve seen a shift in investors pontificating on how many additional Fed hikes are left to how many Fed cuts are ahead. This change of focus is likely a result of last month’s increase in the unemployment rate and broad softening in labor data." -Piper Sandler's Michael Kantrowitz

* source: Piper Sandler

| the rise of The Bond Vigilantes | "Fiscal excess in the 2020s is adding to already high levels of government debt; until policy makers address the trajectory of government debt, investors are likely to worry that asset-bearish solutions to indebtedness such as inflation, default, currency debasement, are set to be pursued; but as likely central banks may simply bail out governments in coming years via QE & the introduction of YCC (policies that would be v US dollar
negative). " -BofA's Michael Hartnett

* source: BofA's Michael Hartnett

| The Fed’s balance sheet peaked at an extraordinary 38% of GDP in 2022, up from 19% in 2019, and on average 5% in the 60 years that followed WW2.

* source: BofA's Michael Hartnett

1) KEY TAKEAWAYS

1) Equities + Oil + TYields HIGHER | Dollar LOWER

-Treasury bond issuance today

-Jobless claims dip to 217K, point to sturdy U.S. labor market -MarketWatch

-Fedspeak today

-AAII (Retail) Sentiment: Bullish spiked (most since 2010), bearish plunged (biggest one week drop since 2003), and neutral ticked up.

THEMES: 55 S&P 500 companies report this week | 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 | Dovish Powell takeaways and less hawkish BoJ policy tweak | Outsized CTA short positioning helped both stocks and bond rally | 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 | Still no consensus among House Republicans regarding a stopgap measure to keep government open beyond 17-Nov | Busy week of Fedspeak | Elevated note auctions this week, will there be demand? | rising default rates

-by Shon Wilk

DJ +0.3% S&P500 +0.1% Nasdaq +0.0% R2K +0.2% Cdn TSX +0.6%

Stoxx Europe 600 +0.8% APAC stocks HIGHER, 10YR TYield = 4.535%

Dollar LOWER, Gold $1,952, WTI +1%, $76; Brent +1%, $80, Bitcoin $37,667

2) will labor markets soften? | "Initial jobless claims were little changed in the week ended November 4 and remain at levels consistent with few layoffs. Meanwhile, continued claims stayed on an upward trajectory, rising to the highest level since April"

* source: Oxford Economics

3) will labor markets soften? | "Labor market conditions still too hot for the Fed" -Oxford Economics

* source: Oxford Economics

4) This week:

-University of Michigan's consumer survey

-Fed's SLOOS report.

-Q3 GDP in the UK and economic activity indicators in Germany.

-wages in Japan and inflation and trade reports in China.

-Central banks will also be in focus with appearances from heads of the Fed, the ECB, the BoJ and the BoE, as well as the RBA decision. Notable earnings include Walt Disney, Saudi Aramco, AstraZeneca and Uber.

2) ESG, COMPILED BY NATHAN GREENE

ESG strategy effectiveness increasingly dependent on global trade professionals - Reuters

-Global trade professionals play a pivotal role in the execution of environmental, social & governance (ESG) strategies because of the presence of cross-border supply chains. In fact, 88% of businesses collect information for ESG purposes from their suppliers at least once a year, according to the Thomson Reuter Institute’s 2023 Corporate Global Trade Survey Report released in mid-September.

US-China Climate Talks Wrap Up With Warm Words But Few Details - BNN

-The top climate envoys from the US and China ended five days of face-to-face talks late Wednesday, hailing progress but offering no details of any new initiatives to slow the pace of global warming.

3) MARKETS, MACRO, CORPORATE NEWS

• Bond sales are becoming a bigger deal for stocks than US jobs data-BBG
• Japanese funds buy most US debt in half year, pressuring yen-BBG
• Rising JGB yields lure Japanese life insurers away from U.S. Treasurys-NIKKEI
• Exclusive: China asks brokerages to curb leveraged stock trades-RTRS
• BOJ debated groundwork for future easy-policy exit at Oct meeting-RTRS
• BOJ may end negative rates in January, ex-central bank executive says-RTRS
• ECB rate-cut talk is ‘clearly premature,’ Guindos tells Finance-BBG
• ECB won’t hike rates again, barring shocks, Villeroy says-BBG
• Overdue commercial property loans hit 10-year high at US banks-FT
• China's consumer prices back in decline as recovery wobbles-RTRS
• Japan eyes $13bn in aid for chips, generative AI in stimulus budget-NIKKEI
• Japan current account surplus hits record in support for economy-BBG
• Israeli troops fight Hamas in north Gaza, hospitals in firing line-RTRS
• US calls for Palestinian Authority run Gaza & West Bank after war w/ Hamas-FT
• US forces under fire in Middle East as America slides towards brink-RTRS
• Scoop: Biden and Xi prepare to restart military-to-military channels-AXIOS
• China lays out grievances with US before Yellen-He meeting-BBG
• US lawmakers want Biden to hike tariffs on Chinese-made vehicles-RTRS
• Adnoc makes new offer to acquire Braskem: Valor-BBG
• DraftKings discussed bid for William Hill owner 888-FT
• Bill Holdings nears $1.95 billion deal for Melio Payments-BBG
• SAG-AFTRA actors' union reaches tentative labor agreement-CNBC
• Morgan Stanley’s wealth management arm draws Fed scrutiny-BBG
• Generali has 500 mln euros left for M&A, could return it to investors-RTRS
• Vedanta in talks to raise upto $2.5 bn to repay overseas bondholders-BUSSTA
• Apple risks $14 billion tax bill in setback at top EU court-BBG
• Disney tops earnings forecasts as Iger sets 'building' phase-RTRS
• Amazon offering Prime members low-cost primary health care access-HILL
• Apple dealt blow at top EU court over €14.3bn tax bill in Ireland-FT
• Nvidia plans to release three new chips for China - local media-RTRS
• Auto wage hikes complicate the search for an affordable EV-BBG
• FDA approves Eli Lilly’s tirzepatide for weight loss-CNBC

Oil/Energy Headlines: 1) Oil at $100 a barrel is looking less likely after all-BBG 2) EU to extend emergency energy measures on Middle East risks-BBG 3) Houthi rebels shot down a U.S. drone off Yemen’s coast, Pentagon says-NYT 4) Iraq officials, Kurdish industry reps meet to discuss pipeline restart-RTRS 5) Saudi Aramco to supply full oil volumes to N. Asia refiners in December-RTRS 6) Russian oil shaves India's import costs by about $2.7 bln-RTRS 7) Nigeria's giant new oil refinery months away from full start up-BBG