CNBC Daily Open: All eyes on U.S. fourth-quarter GDP

A buyer visits a grocery store in San Mateo, California, on Dec. 12, 2023.

Li Jianguo | Xinhua News Agency | Getty Images

This report is from right this moment’s CNBC Daily Open, our worldwide markets e-newsletter. CNBC Daily Open brings buyers up to the mark on every little thing they should know, irrespective of the place they’re. Like what you see? You can subscribe here.

What you must know right this moment

China, Hong Kong shares lead positive aspects
China and Hong Kong shares
led gains in Asia on Thursday after the People’s Bank of China mentioned it could lower reserve requirements for the nation’s lenders. Overnight, U.S. shares ended mixed because the S&P 500 hit one other document excessive, whereas the Nasdaq Composite additionally closed larger. But the blue-chip Dow Jones Industrial Average ended within the purple. Fourth-quarter U.S. GDP data is due on Thursday, which is anticipated to indicate the economic system is on the crossroads.

China to boost confidence ramps up help
Expectations are rising that China will do more to spice up its ailing economic system and inventory markets, particularly after the central bank’s easing announcements on Wednesday. The newest transfer “could also be interpreted as the start of a coverage pivot from earlier reactive and piecemeal measures by buyers,” mentioned one China economist in be aware.

Tesla’s earnings disappoint
Tesla reported fourth-quarter earnings that missed estimates as automotive income elevated simply 1% from a 12 months earlier. The electrical automobile maker additionally issued a downbeat full-year manufacturing outlook. The weak steering weighed on the inventory, which dropped almost 6% in prolonged buying and selling. On Thursday, shares of Tesla’s suppliers in Asia fell on the again of its bleak outlook.

Survey reveals U.S. corporations favor India over China
In a survey of 500 executive-level U.S. managers performed by market analysis OnePoll, 61% mentioned they’d decide India over China if the 2 might manufacture the identical supplies. It additionally confirmed 56% most popular India to serve their provide chain wants throughout the subsequent 5 years over China.

[PRO] Health care not a laggard
The health-care sector “has shrugged off the title of being a notable laggard in 2023,”  Citi analysts mentioned in a latest be aware. They have cited biotech in particular as one of a few areas to watch. Growth shares such these in tech and biotech are seen as largely benefitting from Fed fee cuts.

The backside line

All eyes shall be on the state of the U.S. economic system as the primary official studying of fourth-quarter GDP data drops Thursday morning.  

Wall Street shall be parsing the main points for indicators on the well being of the economic system. Although economists not see a recession on the horizon, some suspect the tempo of actual GDP development will reasonable within the coming quarters.

The consensus outlook is for financial development to come back in at an annual fee of two% within the fourth quarter, a slowdown from 4.9% within the third. This would be the lowest studying because the 0.6% decline within the second quarter of 2022.

“Data launched [Thursday] might on reflection prove to doc the one quarter of true ‘Goldilocks’ situations,” Citi economist Andrew Hollenhorst wrote. “But we don’t share the market and Fed’s sanguine evaluation of the macroeconomy over the rest of the 12 months.”

In a latest commentary, Ian Shepherdson, chief economist at Pantheon Macroeconomics, wrote the precise GDP information might maintain some surprises as forecasts might typically be thrown off by late-arriving information.

Since 2016, a slew of presidency information was printed the day earlier than the GDP report — reminiscent of, enterprise inventories and commerce figures, that are a part of the GDP calculation. But these are actually scheduled to be launched similtaneously Thursday’s report.

“The GDP numbers have a lot larger potential to shock than shall be appreciated by buyers with out pre-2016 expertise,” Shepherdson mentioned.

Whatever the numbers, buyers will chew over the info to gauge what path the Fed will absorb its anti-inflation battle.  

— CNBC’s Jeff Cox contributed to this report.

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *