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European Stocks Pause Rally With Earnings in Focus: Markets Wrap

Nicholas Jacobino and Rachelle Akuffo
Wed, November 15, 2023 at 6:27 PM GMT+1

(Bloomberg) -- Stocks paused their rally as the euphoria over a potential dovish pivot by central banks faded and investor attention turned to the latest corporate earnings and deals news.

The rally on Wall Street and in Treasuries this week following a soft inflation print in the US has prompted some to ponder whether the market is jumping the gun on expectations of a dovish pivot by the Federal Reserve. The S&P 500 has gained more than 7% this month.

The focus in the outlook for rates turns next to US initial jobless claims and industrial production figures due later Thursday, with a line-up of Fed speakers for investors to also tune into. Earnings from Walmart Inc. will provide a further insight into the state of the economy.

“US equity markets are approaching overbought levels, so it feels like we have the makings of a pullback,” said Tony Sycamore, a market analyst at IG Australia. Sycamore said the Fed “won’t be thrilled by the recent easing in financial conditions, undermining its higher-for-longer message.”

Traders also assessed China president Xi Jinping’s comment that his country will not fight a cold, or a hot, war with the US as a sign Beijing is intent on repairing recently soured relationship with the US. There’s “not much so far” from the talks between the two leaders, but “the tone from both sides seems conciliatory and that is good,” said Redmond Wong, a market strategist at Saxo Capital Markets in Hong Kong.

Key events this week:

    US initial jobless claims, industrial production, Thursday

    Walmart earnings, Thursday

    Cleveland Fed President Loretta Mester, New York Fed President John Williams and Fed vice chair for supervision Michael Barr speak, Thursday

    Bank of England deputy governor Dave Ramsden and ECB President Christine Lagarde speak at event, Thursday

    US housing starts, Friday

    US Congress faces a midnight deadline to pass a federal spending measure, Friday

    ECB President Christine Lagarde speaks, Friday

    Chicago Fed President Austan Goolsbee, Boston Fed President Susan Collins and San Francisco Fed President Mary Daly speak, Friday

https://finance.yahoo.com/news/shares-as...21523.html

Strategist on Fed rate cuts: 'Be careful what you ask for'
Nicholas Jacobino and Rachelle Akuffo
Wed, November 15, 2023 at 6:27 PM GMT+1

As the stock market surges, inflation cools, and consumer spending habits shift, many investors are betting that the Federal Reserve is done with interest rate hikes and are preparing for a soft landing scenario. Some experts are going so far as to say that the Fed will cut rates in 2024.

Mahoney Asset Management CEO Ken Mahoney joins Yahoo Finance to discuss what investors need to pay attention to during periods of uncertainty and why cutting rates may not be in the Fed's best interest.

"A lot of people are talking about these rate cuts next year, I don't see that. Again, I know Fed fund futures have shown by May maybe a rate cut or two, [but] I do believe it's going to be higher for longer," Mahoney states. "They may not raise rates, but I think they're going to keep it longer. Be careful what you ask for — if you ask for rate cuts, what's a company with rate cuts? Probably a negative GDP print."

https://finance.yahoo.com/video/strategi...38314.html