Baltic Dry Index. 2495 -353 Brent Crude 75.50
Spot
Gold 2030 US
2 Year Yield 4.58 -0.02
Wars begin when you will, but they do not end when you please.
Niccolo Machiavelli.
In the
stock casinos, more erratic action. No one seems to know if next year brings a
Goldilocks ending, a soft landing, a crash landing, or World War Three.
Well,
at least for now, thankfully, no one is yet forecasting World War Three though
events in Gaza are increasing the odds with each passing tragic week.
Below,
the stock casinos awaiting today’s latest US employment numbers and with them a
possible Sahm Rule jobs recession trigger.
Asia markets
mixed as Japan’s third-quarter GDP revised downward, India holds rates
UPDATED FRI, DEC 8 2023 12:37 AM
EST
Asia-Pacific markets were mixed as Japan’s
third-quarter GDP was revised downward in a surprise move, while India’s
central bank held its benchmark lending rate steady.
Japan’s
third-quarter GDP was revised downward to a 0.7% fall quarter-on-quarter, a
sharper slide compared with the 0.5% decline estimated earlier. Economists had
forecast that the revised figure would be unchanged at 0.5%
The Reserve Bank of
India held its repo rate at 6.5%, in line with a Reuters poll of 64 economists
that unanimously forecast the bank would keep its benchmark policy rate steady.
In Australia, the S&P/ASX
200 rose
0.3% and ended at 7,194.9, reversing earlier losses.
Japan’s Nikkei 225 tumbled
1.91% after the GDP data release, while the Topix fell 1.73%.
South Korea’s Kospi climbed
1.02% and the small-cap Kosdaq advanced 1.91%.
Hong Kong’s Hang Seng index rebounded,
up 0.17%, while the mainland Chinese CSI 300 gained 0.48%
Overnight in the U.S., all three major indexes
gained ground as the Dow Jones
Industrial Average and S&P 500 broke
three-day losing streaks, ahead of Friday’s all-important
jobs report.
The S&P 500 climbed 0.8%,
while the blue-chip Dow added 0.17%. The Nasdaq Composite advanced
1.37% as technology stocks outperformed.
Google-parent Alphabet gained
more than 5% as traders cheered the company’s launch of
its Gemini artificial intelligence model. Nvidia and AMD also
added more than 2% and 9%, respectively
Asia stock markets
today: Japan trade, Q3 GDP, U.S. jobs (cnbc.com)
Yen soars, Nikkei
slides as rate hikes loom over Japan
By Tom Westbrook
December 8, 2023 3:12 AM GMT
SINGAPORE, Dec 8
(Reuters) - Japanese markets were reeling on Friday, with the Nikkei heading
for its biggest weekly drop since October, bonds battered and the yen surging
toward its largest weekly gain for five months as investors rushed out of bets
on Japanese rates staying low.
Beyond Japan MSCI's broadest index of Asia-Pacific shares ex Japan (.MIAPJ0000PUS) rose 0.5% and Treasuries sold slightly. The Nikkei (.N225) was down 1.6% for a weekly drop of 3.3%.
Other moves were
more modest as traders wait on U.S. labour data due later in the day.
The
yen leapt more than 2% on Thursday and was well supported on Friday, though
kept below an overnight four-month peak of 141.6 per
dollar to trade at 143.39.
Bank
of Japan Governor Kazuo Ueda told parliament on
Thursday the central bank faces an "even more challenging" year ahead
before discussing options for exiting its ultra-easy settings, which traders
took as a sign of change in the offing.
The BOJ is due to
set policy rates on Dec. 19.
"This may
prove to be too soon for large steps to be unveiled, but... we believe it is a
matter of when, not if, the BOJ jettisons its negative interest rate
regime," said Corpay currency strategist Peter Dragicevich.
"This
eventual turn and the capital flow implications... underpins our forecasts
looking for the 'undervalued' yen to strengthen over the next year. This is
also one of the pillars behind our outlook for the dollar to weaken."
More
Yen
soars, Nikkei slides as rate hikes loom over Japan | Reuters
Stock
futures are little changed ahead of key November jobs report: Live updates
UPDATED FRI, DEC 8 2023 12:38 AM
EST
Stock futures were little changed Friday morning
as investors looked ahead to Friday’s jobs report.
Futures
tied to the Dow Jones Industrial Average ticked
higher by 6 points, or 0.02%. S&P 500
futures inched
down by 0.04%, and Nasdaq 100 futures lost
0.13%.
In regular trading, the Dow advanced
62.95 points, or 0.17%, while the S&P 500 climbed
0.8%. Both snapped three-day losing streaks. The Nasdaq Composite jumped
1.37%.
The Dow’s 0.4% week-to-date loss
and the S&P 500 0.2% decline put both averages on track to break their
5-week win streak. Meanwhile, the Nasdaq climbed back into positive territory
for the week. It’s currently higher by 0.2%, and if it stays in the green, it
could post a sixth straight winning week.
Investors have been focused on
jobs data, with several reports sprinkled throughout the week leading up to
Friday’s finale: the big November nonfarm payrolls report. Initial jobless
claims reported on Thursday came in at 220,000, while continuing claims came in
at 1.861 million.
“The market is clinging to each
data point to see if the economy can continue with this Goldilocks scenario
where the labor market cools just enough to take pressure off wages but not tip
the market in the recession,” Stephanie Lang, chief investment officer at
Homrich Berg, told CNBC.
“Today’s continuing claims help
support recent data points of a softening but resilient labor market, and
tomorrow will be telling to see if the November job reports can support a
similar narrative,” she added.
Earlier in the week, investors
also got private
payrolls data that showed employers added fewer positions than
economists forecasted, and job openings data that showed a decline to the lowest
level since March 2021.
Investors are also looking
forward to the University of Michigan’s preliminary consumer sentiment data for
December, which is scheduled to be released at 10 a.m. ET Friday.
Stock
market today: Live updates (cnbc.com)
Market bets for 2024
thrown into chaos by US recession conundrum
By Naomi Rovnick December 7, 2023 6:11 AM GMT
LONDON, Dec 7
(Reuters) - Investment banks and asset managers have wildly varying stock
market and currency calls for 2024, reflecting deep division over whether the
U.S. economy will enter a long-heralded recession and drag the world with it.
The lack of
consensus among forecasters is a stark contrast to a year ago, when most
predicted a U.S. recession and rapid rate cuts that failed to materialise. The
world's largest economy expanded by 5.2% in the third quarter of this year.
The divisions
this year have produced a scattergram of projections for the U.S. interest rate
path and how global assets that are influenced by the Federal Reserve's actions
will perform.
Market
participants are therefore bracing for a bumpy start to the new year after
a strong
rally last month for both stocks and bonds
based on a short-term consensus that inflation and interest rates are on a firm
downward path.
"Whether the
U.S. has a hard landing or a soft landing will dominate the market," said
Sonja Laud, chief investment officer at Legal & General Investment
Management.
"The
narrative isn't clear yet," she added, noting that if current interest
rate forecasts "were to shift significantly that creates significant
volatility" .
Options
trading data shows that investors are becoming increasingly interested
in protecting their portfolios from heightened stock market volatility ahead.
Economists polled
by Reuters predict 1.2% U.S. GDP growth for 2024 on average.
But while
forecasters are united that the Fed's most aggressive rate hiking cycle in
decades will cause a slowdown, they are split on whether 2024 will also include
a couple of quarters of economic contraction that may prompt rate cuts and
weaken the dollar.
Amundi,
Europe's largest asset manager, now expects a U.S. recession
in the first half of 2024, meaning the group is negative on the dollar and
likes emerging market assets.
----
Morgan Stanley, however, sees no recession and reckons the Fed may keep rates
high well into next year. It views the dollar index rising to 111 points from
104 currently, the euro dropping to $1 and the yen recovering only moderately
to 142 per dollar.
----
Deutsche Bank predicts a mild U.S. recession in the first half of 2024 and a
whopping 175 basis points of rate cuts, with lower borrowing costs driving the
S&P 500 share index (.SPX) to 5,100 points. The S&P 500 has gained 19%
this year to 4,567.
JP
Morgan views a recession as
possible and the S&P finishing the
year at 4,200, while Goldman Sachs sees only limited recession risk.
Equity analysts'
estimates of S&P 500 earnings are currently the most dispersed since the
COVID-19 pandemic, according to Blackrock Investment Institute (BII).
LGIM, which
manages roughly $1.5 trillion of assets, is underweight equities and expects a
U.S. downturn, Laud said.
More
Market bets for 2024 thrown into chaos by US recession conundrum | Reuters
Global Inflation/Stagflation/Recession
Watch.
Given
our Magic Money Tree central banksters and our spendthrift politicians,
inflation now needs an entire section of its own.
House
prices rise again – but London properties still down on last year
THURSDAY 07 DECEMBER 2023 7:32 AM
The average price of a
home rose by 0.5 per cent in November, following a rise of 1.2 per cent
the prior month, according to the latest reading from Halifax.
On an annual basis,
house prices fell by 1.0 per cent compared to a 3.1 per cent fall in October.
The cost of a home is also £40k above pre-pandemic levels.
In the UK the typical
cost of a property now sits at £283k, around £1,300 more than last month.
London has retained the top spot for the highest average
house price in Britain, at £524k. However, prices in the capital have now
fallen by 3.8 per cent on an annual basis.
Kim Kinnaird, director
at Halifax Mortgages, said that despite the wider economic headwinds, property
prices have held up better than expected, as a shortage of supply has improved
pricing.
In the last year, many
sellers have put off placing their homes on the market because of high mortgage
rates offset by surging inflation.
She said: “The
resilience seen in house prices during 2023 continues to be underpinned by a
shortage of properties available, rather than any significant strengthening of
buyer demand.
“That said, recent
figures for mortgage approvals suggest a slight uptick in activity levels,
which is likely as a result of an improving picture on affordability for
homebuyers.”
She added: “Other pressures – like inflation, the broader
cost of living, overall employment rates and affordability – mean we expect to
see downward pressure on house prices into next year.”
More
House prices rise again - but London properties still
down on last year (cityam.com)
Bank
of England: Economy resilient but full force of interest rates yet to come
WEDNESDAY 06 DECEMBER 2023 11:00 AM
The UK economy has
weathered the worst of a rapid interest rate tightening cycle this year but the
full force of hikes is yet to filter through to smaller and highly-leveraged
businesses, the Bank of England warned today.
In its Financial
Stability Report today, Threadneedle
Street’s Financial Policy Committee said higher interest rates continue to put
some firms and households “under pressure” but UK corporates in particular were
expected to remain “broadly resilient to higher interest rates and weak growth”.
“In aggregate, UK
corporates’ ability to service their debts has improved due to strong earnings
growth,” the Financial Policy Committee said.
“But the full impact
of higher financing costs has not yet passed through to all corporate borrowers
and will be felt unevenly, with some smaller or highly leveraged UK firms
likely to remain under pressure.”
Insolvencies among firms have risen
over the past three months but remain “low”, the Bank added.
The amount of outstanding UK
corporate debt relative to corporate earnings has continued to fall since its
recent peak during the covid pandemic.
The latest data covering the period
between April and June this year shows that corporate debt to earnings ratio
stood at 276 per cent, down from 345 per cent at its peak during the pandemic
in 2020, a figure that has come into sharper relief in recent years as interest
rates jumped.
The share of corporates at higher
risk has also slumped below the heights seen in 2020 its pandemic peak.
However, pressure was still likely to be piled on firms in sectors particularly
exposed to economic swings, like retail and the property market, according the
the Bank of England’s analysis.
While the Bank’s Monetary Policy
Committee has paused its rate hiking cycle and opted to hold rates at 5.25 per
cent in its past two meetings, households are likely to come under further
strain as rates stay higher for longer in the UK.
Some five million households face
paying an extra £240 a month on their mortgage bill by the end of 2026 as
the last cheap fixed-rate loans come to an end, the Bank of England warned
The Bank published its quarterly
assessment of financial risks to the economy today in which it laid out a list
of threats still lingering over the UK.
The threat of the so-called shadow
banking sector to the UK economy has heightened this year even as traditional
UK lenders look to have weathered the worst of economic turmoil.
More
Bank of England: Economy resilient but full force of
interest rates yet to come (cityam.com)
Covid-19 Corner
This section will continue until it becomes unneeded.
Video
approx. 3 minutes. The BBC still promoting flawed vaccines. Information or
disinformation?
Covid: Why do some vaccines protect you for longer than others?
A measles vaccine
can protect you for a lifetime. Tetanus gives you about 10 years of cover,
while flu vaccines need updating every year. When it comes to Covid-19, we’re
still not sure exactly how long protection from the vaccine lasts.
BBC Health and Disinformation Reporter Rachel Schraer explains why.
Covid: Why do some vaccines protect you for longer than others? - BBC News
21st century adage: Is that true, or did you hear it on the BBC?
Technology
Update.
With events happening fast in the development
of solar power and graphene, among other things, I’ve added this section.
Updates as they get reported.
Google's new Gemini AI beats GPT and human experts
across 57 subjects
Loz Blain December 06, 202
Google has unveiled its awesome next-gen Gemini AI, claiming
it outperforms OpenAI's GPT-4 – as well as human experts – on nearly all major
tests. It understands images, video and audio as well as text and code, and
will gain other senses over time.
With a score of 90.0% on the MMLU (massive multitask language
understanding) test, it's the first model to outperform human experts (89.8%),
as well as GPT-4 (86.4%) in a range of knowledge and problem solving tasks
across a range of 57 subjects including math, physics, history, law, medicine
and ethics. That's experts, not the average human.
Gemini is multimodal from the ground up – meaning that its original
training data set contained a ton of other media in addition to text. Thus, you
could say it's as fluent in visual and auditory "understanding" as it
is with text. Where other language models have tended to "think" in
textual terms when looking at video and images, Gemini retains all the tone and
nuance of the original video, audio and image sources.
While the video below is a slick product demo, and thus should be taken
with a large grain of salt, it's worth watching to give you a sense of what
this multimodality really means.
----What's
the upshot here? Well, AIs are being trained with wider and wider sensory
datasets, to mimic the processes by which humans learn to interact with the
world. With next-level visual and auditory understanding, Gemini's perception
and reasoning take a step forward. Once this thing lands in Google devices –
beginning with the next Pixel phones – it'll be able to help with all sorts of
daily tasks.
And as Google Deepmind CEO Demis Hassabis tells Wired, this will soon
extend into the next logical sensory realm: touch and tactile feedback. Google
is already a major player in AI robotics, but embedding a super-knowledgeable
model like Gemini with the ability to understand the world through touch will
take robotics – humanoid and otherwise – into uncharted territory.
The demo video here uses a pretty lightweight use case: planning a kid's
birthday party. But you can see the extraordinary power it encapsulates, and
imagine how it might create graphical user interfaces for nearly any task you
could imagine. This is the sort of thing only AI can do; it's like having a web
app programmer sitting right next to you, but capable of working hundreds of
times faster.
And as with any AI tool, it's super interactive; if it's not giving you
exactly what you want, you can just tell it, and it'll adjust itself to fit
your desires, or engage in a conversation about the best way to proceed.
Stunning stuff, and a glimpse into how our interactions with technology are
fundamentally shifting.
More
Google's new Gemini AI beats GPT and human experts
across 57 subjects (newatlas.com)
Another
weekend and man’s inhumanity to man is on full display in the Gaza Ghetto. Or
rather, man’s inhumanity to Gaza’s women and children. A modern day version of
the Roman’s destruction of Jerusalem in 70 AD, with both sides claiming to be
in the right.
But not
to worry, President Biden, the leader of the free world, says it’s OK and he
approves of it. Nothing good for the
west comes from this, I suspect. Have a great weekend everyone.
In war, truth is the first casualty.
Aeschylus.
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