Good morning investors!
The S&P ended slightly lower after the JOLTS report showed job openings were significantly lower than expected, further indicating that the jobs market is cooling.
This morning we get the ADP employment data — the second major jobs report of the week. The numbers will be the major catalyst for trading today but investors will be waiting for the nonfarm payrolls report on Friday to fully confirm the state of the labor market.
After the bell, Reddit favorite GameStop reports earnings. The numbers won’t move the markets but with so few earnings this week, it’s something to watch.
Don’t miss a thing - head to the Discord to get full breakdowns of all earnings and economic reports.
Market Recap
It was a mixed day for the major indexes, while Bitcoin moved higher and treasury yields and oil prices fell.
U.S. job openings hit more than 2-1/2-year low as labor market cools
U.S. job openings fell to more than a 2-1/2-year low in October, the strongest sign yet that higher interest rates were dampening demand for workers, and boosting financial markets expectations the Federal Reserve's monetary policy tightening cycle was over. The Labor Department's Job Openings and Labor Turnover Survey, or JOLTS report, showed job openings, a measure of labor demand, fell 617,000 to 8.733 million on the last day of October, the lowest level since March 2021 and down from 9.350 million in September. Economists had forecast 9.30 million job openings. The report also showed that there were 1.34 vacancies for every unemployed person in October, the lowest since August 2021 and down from 1.47 in September. Read more
Elon Musk’s AI startup — X.AI — files to raise $1 billion in fresh capital
X.AI, an artificial intelligence startup founded by Elon Musk, has filed with the SEC to raise up to $1 billion in an equity offering. The company has already brought in nearly $135 million from four investors, with the first sale occurring on Nov. 29, and has a “binding and enforceable agreement” for the purchase of the remaining shares, the filing says. The AI startup, which Musk announced in July, seeks to “understand the true nature of the universe,” according to its website. Last month, X.AI released a chatbot called Grok, which the company says is modeled after “The Hitchhiker’s Guide to the Galaxy.” The chatbot debuted with two months of training and has real-time knowledge of the internet, the company claims. Read more
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Wells Fargo CEO warns of severance costs of nearly $1 billion in fourth quarter as layoffs loom
Wells Fargo WFC 0.00%↑ CEO Charlie Scharf said Tuesday that low staff turnover means the company will likely book a large severance expense in the fourth quarter. “We’re looking at something like $750 million to a little less than a billion dollars of severance in the fourth quarter that we weren’t anticipating, just because we want to continue to focus on efficiency,” Scharf told investors during a Goldman Sachs conference in New York. That expense is an accrual for worker layoffs that Wells Fargo expects to make next year, according to a bank spokeswoman. The company declined to say how many jobs it will cut. Read more
CVS to change how it prices prescription drugs with new pharmacy reimbursement model
CVS Health CVS 0.00%↑ on Tuesday said it will revamp how it prices prescription drugs and scrap a complex model that typically sets how much pharmacies get reimbursed and what patients pay for those medications. The new effort makes CVS the latest company to try to upend the traditional prescription drug pricing system, which has faced years of political scrutiny for what critics call a lack of transparency and inflated health-care costs for U.S. consumers. CVS will launch a new model for reimbursing its pharmacies on Jan. 1, 2025 for commercial payors, executives said during the company’s 2023 investor day. Read more
Moody's puts China on downgrade warning as growth, property pressures mount
Ratings agency Moody's slapped a downgrade warning on China's credit rating on Tuesday, saying costs to bail out local governments and state firms and control its property crisis would weigh on the world's No. 2 economy. Moody's lowered the 'outlook' on China's A1 debt rating to "negative" from "stable" less than a month after it had done the same to the United States' last remaining triple-A grade from a credit rating agency. Beijing likely needs to provide more support for debt-laden local governments and state firms which pose "broad downside risks to China's fiscal, economic and institutional strength," it added. Moody's also cited "increased risks related to structurally and persistently lower medium-term economic growth and the ongoing downsizing of the property sector." Read more
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Thank you for taking the time to read today’s newsletter. Until next time investors!
Chris
CMG Venture Group
Disclaimer
I am not a licensed financial advisor or financial professional. This is not investing advice. It is very important that you do your own research and make investments based on your own personal circumstances, preferences, goals and risk tolerance.
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