vestact posted: " Market Scorecard US markets inched higher again yesterday, like a bushveld dung beetle emerging after a long dry winter. The mini-rally since late last week was prompted by encouraging company earnings, and there will hopefully be more of those ou" Vestact - Money with a dash of funny
US markets inched higher again yesterday, like a bushveld dung beetle emerging after a long dry winter. The mini-rally since late last week was prompted by encouraging company earnings, and there will hopefully be more of those out today. We will be most-focused on numbers from Google, Microsoft and Visa.
So far, a fifth of S&P 500 companies have reported their third-quarter earnings, with more than half surprising to the upside. This is well ahead of Wall Street expectations because this was assumed to be a not-so-good quarter, with poor forward guidance.
In company news, Apple announced that it will raise prices for subscription music and TV services, citing higher input costs. Elsewhere, Tesla closed down 1.5% after lowering prices for electric vehicles sold in China, the world's largest EV market by a mile.
Yesterday, the JSE All-share closed down 0.86%, but the S&P 500 rallied by 1.19%, and the Nasdaq rose 0.86%.
Our 10c Worth
One Thing, From Paul
According to most political pundits, the Republican Party (GOP) will win back control of the US House of Representatives in the forthcoming mid-term elections. Those take place on Tuesday, 8 November 2022. The new Speaker of the House is likely to be Kevin McCarthy, replacing Nancy Pelosi.
Some also think that the GOP will capture the Senate, ending the current 50-50 tie. That will cancel Democratic Party control, since Vice President Kamala Harris won't be able to cast her deadlock-breaking vote anymore.
These are the close Senate races to watch on the night: Ohio, Pennsylvania, Wisconsin, Georgia, Nevada, Arizona, New Hampshire, and Colorado. Some of these contests will be very tight and might require recounts, so the final outcome may be delayed by a week or two.
If the GOP does win control of both houses, Joe Biden will be a lame-duck President. Activist legislation will be dead in the water, and taxes won't change. The market is likely to rally in this case.
Byron's Beats
Towards the end of 2018, the market was convinced that China's growth story was coming to an abrupt end. Back then people spoke of a Chinese "hard landing" and markets around the world tanked. The S&P 500 dropped over 19% in a few months. As it turned out, China continued to grow at a steady pace and the market recovered quite nicely.
Yesterday Chinese stocks got clobbered. The Hang Seng in Hong Kong dropped 6% at one stage, while the Shanghai Composite dropped 2%. This came after the weekend news that Xi Jinping will be in power for a third term, and has obliterated all opposition to his rule. I don't intend to go too deeply into Chinese politics here, my point is that global markets don't seem to care much for, or about, China at the moment. Most markets around the world were actually up yesterday.
Xi's anti-business policies and crazy zero-Covid restrictions seem to be reversing years of gains that China and its private businesses have achieved. I suppose, depending which way you look at it, having a weaker China is not such a bad thing. I don't know if we want the global economy overly reliant on such a volatile power?
Michael's Musings
During the height of Covid, oil prices were negative for one afternoon as traders scrambled to find storage for oil being delivered the next day. Yesterday, very short-dated European natural gas prices did the same thing - they went negative.
Europe has been scrambling to fill up their storage containers in anticipation of winter and a lack of gas supply from Russia. They have done really well, and their tanks are almost at capacity. Thanks to a warmer start to winter, gas demand has been lower than expected, leaving some traders without a place to deliver their gas.
Longer-dated gas prices are still about 3 times higher than usual, but at their lowest level since Russia cut supply and 70% lower than their peak in August. The energy market is slowly normalising. The worry now seems to have shifted to getting enough gas supply during the next summer, in preparation for winter next year.
Bright's Banter
The Jeffrey Dahmer biopic series has broken some Netflix records, becoming their most successful show of all time with 701.4 million of watch time since launch. This was partly thanks to an increase in subscribers in the third quarter. Dahmer was watched for a whopping 196.2 million hours in its first five days on the platform.
For context, Netflix's number two series is season 2 of "Fate: The Winx Saga," which only hauled 60.9 million hours in seven days. "Cobra Kai" season 5 was third with 38.1 million hours viewed in 14 days. Squid Game netted 448.7 hours in two weeks, whereas Dahmer did 496 million hours in that same period.
Monthly data from Nielsen shows that Netflix accounted for 7.3% of all television viewing in September compared with Disney's 1.9%. Streaming rose in popularity, accounting for a staggering 36.9% of all viewing last month, while cable TV sunk to 33.8%.
Linkfest, Lap It Up
Aeroplane flight paths are public information. LVMH doesn't want its boss being tracked, giving its competitors potentially sensitive information - World's Second Richest Man Sells Jet.
Lionel Messi is preparing for life after soccer. The superstar striker launched a San Francisco-based VC company to target sports and tech investments - Soccer legend makes entry into high finance.
Signing Off
Asian markets are looking a little better this morning. Hong Kong and mainland China shares swung back to gains as the tech sector reversed some of its losses from yesterday, when investors reacted with dismay to President Xi Jinping tightening his control of the government. Japan and South Korean markets also gained.
US equity futures are moving higher in early trade. The Rand is trading at around R18.43 to the US Dollar.
Rishi Sunak will go to Buckingham Palace today to meet the King; the rest of us will just go to the office.
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