In recent headlines:
- The US government has reached its debt ceiling and has initiated “extraordinary measures” to meet its financial obligations.
- NATO gathers to discuss military support for Ukraine, facing some internal disagreements regarding the shipment of tanks.
- The global economic outlook shows improvement, but the IMF chief warns it may not yet be a sign of recovery.
- Major oil companies are entering the electric vehicle charging sector aggressively.
- Google plans to eliminate approximately 12,000 jobs, around 6% of its workforce.
- Inflation in Japan has hit a 41-year high.
- US jobless claims decreased to 190,000, marking the lowest number in 15 weeks.
- The Philly Fed Manufacturing Index indicates a slower pace of contraction in January.
- Housing starts and building permits in the US continue to decline as of December.
Despite economists predicting a decline, the 1.1% drop in retail spending for December was sharper than anticipated. This marks the second consecutive month of declines and raises concerns. While it might be attributed to seasonal variations, in current circumstances, it serves as a cautionary signal about the potential risks to the business cycle.
Highlights from today:
- The US Treasury initiates extraordinary measures for managing financial obligations.
- US producer price inflation slowed in December.
- Job reductions in the tech sector are increasing as Microsoft announces plans to cut 10,000 positions.
- Federal Reserve Chairman Jerome Powell has tested positive for COVID-19.
- The cryptocurrency firm Genesis Global Capital is preparing for bankruptcy.
- Global bond sales have surged to an unprecedented start in 2023, nearing $600 billion.
- US industrial output declined more than expected in December.
- According to the Fed’s Beige Book, inflation is showing signs of slowing while the job market stays tight.
- Home builder sentiment has increased in January, marking the first gain in a year.
- US retail sales fell for the second month in December.
The US stock market has shown signs of stabilization, trading moderately above its recent low. This recovery brings hope, suggesting the worst may be behind us. However, analyzing various metrics suggests a cautious approach. Until there’s stronger evidence to indicate that this rebound signifies a long-term recovery, remaining defensive is advisable.
Key updates include:
- Consumers have decreased spending as noted in the NY Fed survey.
- US-China officials are discussing economic relations.
- China has announced it is open for business following Covid lockdowns.
- Predictions indicate that China’s economy is set for a rebound, as highlighted by fund managers.
- The IEA anticipates a record oil demand this year with China’s reopening expected to drive this.
- The Fed is probing big banks on their climate change preparedness.
- A former economic advisor to Trump believes the US has survived the economic storm.
- UK inflation has decreased for the second consecutive month, still standing at 10.5% in December.
- A Bank of America survey shows fund managers significantly cut back their US equities allocations in January.
- The NY Fed Manufacturing Index has dipped further into the red this January.
While it may be premature to draw definitive conclusions, early indicators from January show a widespread rally across multiple equity factors. This upsurge is particularly driven by high beta shares, as revealed through various ETF proxies.
In other news:
- China’s economic growth decelerated to 3.0% in 2022, the lowest in decades.
- China has recorded a decline in population for the first time in many years.
- Will China’s reopening lead to a surge in oil prices? Possibly not.
- Putin’s actions have been termed “weaponizing food,” raising global concerns, warns the head of a fertilizer company about implications.
- Japan is rearming in response to China’s maneuvers in the Asia-Pacific.
- Corporate leaders and economists discussed looming global recession risks at the Davos meeting, expressing concerns.
- More central bank digital currencies are being explored.
- Microsoft aims to integrate AI tools across its product offerings.
- Bitcoin is witnessing a significant rally year-to-date following a challenging 2022.
- Analysts foresee gold prices potentially approaching record highs this year.
All major asset classes experienced gains last week, providing welcome relief after widespread losses in 2022, based on ETF proxies through the close on January 13.
In the latest updates:
- Treasury Secretary Yellen indicates that the US will reach its debt limit within days.
- China’s reopening may provide a boost to the global economy.
- Secretary Yellen will convene with the Chinese vice premier this week.
- Heightened recession risks persist in the US, according to a Wall Street Journal survey despite slight easing of price pressures.
- Upcoming earnings are projected to take center stage in stock market movements over the coming weeks.
- A mild winter lessens the impact of Russia’s energy tactics on Europe.
- The US Treasury market yields have decreased this year, contrasting with trends from last year.
- The head of India’s central bank has called for a blanket ban on cryptocurrency as reported.
- The wealthiest 1% accumulate around two-thirds of the new wealth generated over the last two years.
- US Consumer Sentiment Index rebounded in January, reaching a nine-month high.
Nathan Vardi
Review via Scientific American
“Finding new therapies that specifically target cancer cells while leaving healthy ones unharmed has become the ultimate goal in cancer drug research,” states Nathan Vardi, a managing editor at MarketWatch and former editor at Forbes. “For Blood and Money” follows the journey of one type of treatment (targeted small-molecule drugs designed for blood cancers) that sees two biotech firms racing to market, driven by a quest for immense profit. The narrative involves various characters, from determined scientists to ambitious entrepreneurs, and the powerful financiers maneuvering for the next billion-dollar breakthrough. Central to this tale are the patients, yearning for solutions and time.
