Nasdaq Markets Outlook

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

| 1602: the Dutch East India Company becomes the first company to issue stocks and bonds on the Amsterdam Stock Exchange.

| Two events y'day: 1) poor Treasury auction adding pressure to bonds; 2) Powell: won't hesitate to tighten more if appropriate - HAWKISH ('23 rate hike odds climbed, '24 Fed Fund futures curve shifted higher) | but yields lower today after up y'day

Powell: “The Federal Open Market Committee (FOMC) is committed to achieving a stance of monetary policy that is sufficiently restrictive to bring inflation down to 2 percent over time; we are not confident that we have achieved such a stance. We know that ongoing progress toward our 2 percent goal is not assured: Inflation has given us a few head fakes.”

* source: Goldman Sachs Global Investment Research

| Earnings | "Q3 earnings beats have come with higher dispersion, weaker revenues and cautious guidance but resilient margins. Post the latest bounce, stocks have narrowed the gap with EPS momentum, while revisions have turned negative. Consensus expects positive earnings inflection into '24, but that's much open to debate."

-Emmanuel Cau, Barclays

* source: Barclays' Emmanuel Cau

| lots of divergence when it comes to economic outlook...recession or no recession in 24?

* source: Goldman Sachs Global Investment 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

1) KEY TAKEAWAYS

1) Equities + Oil + HIGHER | Dollar + TYields LOWER

-UMich Consumer Sentiment survey today at 10AM EST

-14 PMs to exit Columbia Threadneedle amid investment team layoffs -CityWire

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 +0.3% S&P500 +0.5% Nasdaq +0.4% R2K +0.4% Cdn TSX +0.0%

Stoxx Europe 600 -0.9% APAC stocks LOWER, 10YR TYield = 4.585%

Dollar LOWER, Gold $1,946, WTI +1%, $77; Brent +1%, $81, Bitcoin $36,972

2) "China exports to US -18% from peak (vs -4% with RoW - Chart 2), China holdings of US Treasuries lowest ($805bn - Chart 4) since '09,

both functions of US-China trade war" -BofA, The Flow Show, Michael Hartnett

* source: BofA, The Flow Show, Michael Hartnett

3) NEXT 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

Loans linked to ESG face overhaul by under-pressure banks - YahooF

-Corporate loans whose costs are linked to ESG goals are being redesigned by banks in response to rising regulatory pressure and to inject more credibility into a market they hope to grow.

-Amid increasing regulatory scrutiny and suggestions that SLLs enable companies to inflate their green credentials, LSEG data shows issuance has slumped by 36% to $310 billion so far in 2023, from $480 billion in 2022. Total loan volumes also fell in the period, but by a less sharp 21%.

EU-Listed Securities Face Review as ESG Rules Hit Multinationals - BNN

-International companies that have issued stocks and bonds in the EU may need to comply with Europe’s Corporate Sustainability Reporting Directive (CSRD) as soon as January, according to lawyers advising corporate clients affected by the new rules. That’s four years earlier than many had expected and may drive a number of non-EU companies to cancel their EU securities.

3) MARKETS, MACRO, CORPORATE NEWS

• Jay Powell warns Federal Reserve against risk being ‘misled’ in inflation fight-FT
• Investors see Powell's hawkish lean response looser financial conditions-RTRS
• Fed repo facility sinks below $1 trillion as bills stand out-BBG
• ECB makes case for keeping balance sheet big-FT
• Interest rates already high enough tackle inflation says Huw Pill-TELE
• RBA sees elevated inflation as resilient economy aids jobs-BBG
• Mexico signals forthcoming cut after keeping rate unchanged-BBG
• Individual investors pull most cash from US stocks in two years-BBG
• Investors pull record sums from corporate bond ETFs as lending rates soar-FT
• Bitcoin surges above $37,000, hitting highest mark in 18 months-YF
• World’s biggest bank forced to trade via USB stick after hack-BBG
• Israel commits to more limited pauses in Gaza strip fighting-BBG
• Netanyahu still sees peace deal with Saudi Arabia after Gaza fighting-BBG
• Iran warns expansion Gaza war 'inevitable'; says air strikes hit hospitals-RTRS
• Yellen to address economic security tensions with China’s He-BBG
• Banks are doling out fewer business loans-BBG
• UK economy stagnates as high borrowing costs hit activity-FT
• China's Nov new yuan loans seen retreating, policy support in place-RTRS
• China banks rush to raise funds after cash crunch spooks market-BBG
• China's slow economy takes 9% off global manufacturers' profits-NIKKEI
• Why Manchin's retirement is Democrats' worst nightmare-AXIOS
• Biden’s focus foreign conflicts, but swing-state voter worries closer home-BBG
• Netflix, Warner Bros partner w/ Verizon discounted streaming bundle-RTRS
• SK Hynix bets on DRAM upturn with $7.6 bn spending; HBM in focus-KED
• UniCredit, RBI among banks on hook for $2.4 bln in Signa loans-RTRS
• Meta strikes deal with Tencent to sell VR headset in China – WSJ-RTRS
• Futures Broker Marex prepares for New York listing-BBG
• Sony’s googly on CEO may stump Zee merger-MINT
• Tata Technologies in talks Morgan Stanley, US funds for IPO investment-RTRS
• Alaska Judge sides with Conocophillips on new $7.5 billion oil project-BBG
• MGM Resorts reaches historic labor deal with Las Vegas unions, averts strike-RTRS

Oil/Energy Headlines: 1) Oil producers reach for timeworn scapegoat after price drop-BBG 2) OPEC+ October production rises 180,000 b/d, led by Iraq and Iran: Platts survey-PLATTS 3) Explainer: Iran's expanding oil trade with top buyer China-RTRS 4) canada is near plan to limit emissions from oil and gas sector-BBG 5) India looks to diversify crude sources as high prices pull down imports-PLATTS