Nasdaq Markets Outlook

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

TODAY = index (S&P) rebalancing + triple witching. Expect irregular volumes especially in the form of blocks at close by mostly indexers.

| #SizeMatters | Small Caps reaching notable lows vs Large Caps - 22YR lows by some measures

#SizeMatters | Ditto with valuation = Small Caps reaching notable lows vs Large Caps...

1) KEY TAKEAWAYS

1) Equities + Oil LOWER, TYields HIGHER (closing in on August highs)

China continues to trying to stimulate economy | PBOC Adds Support for China Economy With Cash Injection After Reserve Ratio Cut - BBG 

Rising Rates Make Big Companies Even Richer -WSJ

VIX hitting a 52WK low...

* source: CNBC

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

DJ -0.2% S&P500 -0.5% Nasdaq -0.3% R2K -0.5% Cdn TSX +0.2%

Stoxx Europe 600 +0.4% APAC stocks MIXED, 10YR TYield = 4.318%

Dollar LOWER, Gold $1,926, WTI -0%, $90; Brent -0%, $93, Bitcoin $26,488

NOTABLE HEADLINES

• Fed is likely to shy away from calling interest-rate peak next week-BBG
• What rate hike? Investors eye ECB rate cuts as economy weakens-RTRS
• UAW launches unprecedented strike against GM, Ford and Stellantis-AXIOS
• Chinese economic activity data signals optimism after stimulus measures-FT

2) Nothing says "bear market in conviction" more than $1tn of inflows to cash YTD | Meanwhile rates volatility is making fresh ytd lows. 

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

* source: CNBC

3) ARM climbs 25% in Nasdaq debut | At open, ARM valued ~$60 billion - P/E >110x based on the most recent fiscal year profit. That’s comparable to Nvidia’s valuation, which trades at 108 times earnings -CNBC

Instacart Set to Raise IPO Price Target After Successful Arm Debut -WSJ

4) With monetary policy (interest rates) normalizing, equities has a lot of competition...

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

5) Labor market still strong but softening...

* source: Goldman Sachs Global Investment Research

6) food prices falling...

* source: Oxford Economics

7) This week: US CPI (Wed) + PPI (Thurs) + UMich consumer expectation survey (Fri) + ECB decision (Thurs) + labour market / GDP data in the UK.

* source: Grindstone Intelligence

8) Investors = conservative bias | sentiment moderating | equity inflows have stalled | "Less than half of S&P 500 stocks are in uptrends, whether you look at 20, 50, 100, or 200-day average prices" -Grindstone Intelligence

source: Grindstone Intelligence

2) ESG, COMPILED BY NATHAN GREENE

OFF TODAY

3) MARKETS, MACRO, CORPORATE NEWS

• BOJ sees gap between Ueda remarks and market reaction, sources say-BBG
• A $4 trillion ‘triple witching’ event endangers stock market calm-BBG
• China's property slump worsens, clouding recovery prospects-RTRS
• PBOC adds more cash into economy as recovery gathers pace-BBG
• Chinese defence minister under investigation by Beijing, US believes-FT
• House Republicans demand full Huawei sanctions after chip breakthrough-BBG
• U.S. aims new sanctions at Russian military supply chains-NYT
• Italy seeks to reassure markets its deficit is under control-BBG
• Byron Allen makes $10 billion bid for ABC, other Disney networks-BBG
• Disney to cut target for Disney+ streaming subscribers-BBG
• WhatsApp explores ads in chat app as Meta seeks revenue boost-FT
• Huawei used years-old Hynix memory tech in Mate 60 phones-BBG
• SK Hynix powers Huawei Mate 60 Pro-TECH
• BP chair rules himself out as next chief executive-FT
• SocGen open to sale of Equipment Finance unit in strategy review-RTRS
• Boral boss says cement imports increase carbon emissions-AFR
• Atturra prepares higher bid for Cirrus Networks-AFR
• Chip designer Arm jumps 25% in debut win for owner SoftBank-BBG
• France’s Apple spat risks spreading to other EU members-FT
• TSMC tells vendors to delay chip equipment deliveries-RTRS
• Salesforce to hire 3,300 people after layoffs earlier this year-BBG
• Disney holds initial talks on sale of ABC to local broadcaster Nexstar-BBG
• Bayer's new CEO plans to cut management jobs in prelude to overhaul-RTRS
• Looming health care walkout, Kaiser strike authorized by unions-USATODAY

Oil/Energy Headlines: 1) OPEC Statement on peak fossil fuel demand-OPEC 2) Turkey says Iraq oil pipeline ‘more or less ready’ for operations after audit-BBG 3) China oil refinery output rises to record on firmer demand, export margins-RTRS