Stock futures higher as 2023 trading begins on a bullish note; Week Ahead: December jobs report, Fed minutes in focus; Tesla resumes slump after softer-than-expected Q4 deliveries; Sam Bankman-Fried expected to plead ‘not guilty’ to FTX-linked fraud, conspiracy charges and Damar Hamlin in critical condition after suffering cardiac arrest during Monday Night Football.
Five things you need to know before the market opens on Tuesday January 3:
1. — Stock Futures Higher As 2023 Trading Begins On a Bullish Note
U.S. equity futures moved firmly higher Tuesday as global stocks kicked-off new year trading on a high note, powered in part by softer Treasury bond yields and positive economic data from Europe.
With trading volumes still thin, and some major markets closed over the tail end of the holiday season, stocks are set for a firmer open following their worst performance since 2008, which saw a 20% decline for the MSCI World Index and the loss of more than $18 trillion in global equity value.
Softer reading for regional inflation in Germany, a good benchmark for Europe-wide readings, as well as a firming job market in the bloc’s biggest economy helped power the Stoxx 600 to a 1.62% gain in early Frankfurt trading, while London’s FTSE 100 gained 2.06% as the pound eased to 1.1923 against the U.S dollar and commodity prices leaped.
Overnight in Asia, a weaker-than-expected reading of economic activity in China, based on Caixin PMI data, underscored concerns over the surge in Covid infections in the world’s second-largest economy following the easing of business and travel restrictions last month and kept a lid on regional stock gains, with the MSCI ex-Japan index rising only 0.28%. Tokyo’s Nikkei 225 was closed.
Heading into the start of the trading day on Wall Street, U.S. stocks are looking to rebound from their worst year since the global financial crisis, with futures contracts linked to the S&P 500 indicating a 37 point opening bell gain and those tied to the Dow Jones Industrial Average priced for a 278 point jump. The tech-focused Nasdaq is primed for a 127 point gain.
Benchmark 10-year Treasury note yields were marked nearly 9 basis points lower in the European session and trading at 3.746% while the U.S. dollar index, which tracks the greenback against a basket of six global currencies, surged 1.07% to 104.625 in think Asia trading.
2. — Week Ahead: December Jobs Report, Fed Minutes In Focus
The Commerce Department’s December jobs report will be the undoubted highlight of a light week of data releases and earnings reports to kick off the new year, as investors look for further indications that wage increases are helping fuel inflation pressures in the world’s biggest economy.
Analysts expect employers added a net 200,000 new jobs to the economy last month, a notable slowdown from the 263,000 tally recorded in November and the slowest since May of 2021. Headline unemployment is expected to hold at 3.7%, while average hourly earnings are forecast to slow modestly to an annualized rate of 5.0%.
Minutes from the Fed’s December meeting, slated for release on Wednesday, will also provide clues as to the level of concern policymakers have regarding inflation pressures from the labor market following four consecutive 75 basis point rate increases.
The ISM’s key manufacturing PMI survey is also expected this week, alongside November quarter earnings from Dow component Walgreens Boots Alliance (WBA) – Get Free Report, drinks group Constellation Brands (STZ) – Get Free Report and food giant Conarga Brands (CAG) – Get Free Report.
3. — Tesla Resumes Slump After Softer-Than-Expected Q4 Deliveries
Tesla (TSLA) – Get Free Report share moved lower in pre-market trading after the carmaker posted softer-than-expected fourth quarter delivery figures amid what it described as “significant Coivd and supply chain related challenges” that lasted throughout the whole of 2022.
Tesla delivered 405,278 new cars over the three months ending in December, the company said in a statement, up 31.5% from last year and 18.1% from the 343,000 tally reached over the three months ending in October. Deliveries for the full year were pegged at 1,313,851, a 40% increase from 2021 levels.
Analysts were originally looking for a total of around 450,000, but that estimate was reduced over the past month following reports of a week-long shutdown at the carmaker’s key gigafactory in Shanghai.
Tesla shares were marked 2.22% lower in pre-market trading to indicate a Tuesday opening bell price of $120.44 each.
4. — Sam Bankman-Fried Expected to Plead ‘Not Guilty’ To FTX-Linked Fraud, Conspiracy Charges
Sam Bankman-Fried is expected to enter a ‘not guilty’ plea when he faces a U.S. District Court judge for the first time later today following his arrest on an eight count indictment linked to the collapse of his FTX crypto trading platform late last year.
Bankman-Fried, 30, will face U.S. District Judge Lewis Kaplan at a hearing in Manhattan at 2:00 pm Eastern time, charged with eight counts of conspiracy and wire fraud linked to the multi-billion failure of FTX, which collapsed under the weight of an estimated $8 billion hole in its balance sheet.
The founder and former CEO is alleged to have siphoned billions in clients funds from FTX to bolster trading in his wholly-owned Alameda hedge funds, purchase lavish real estate in the Bahamas and make millions in illegal campaign donations to U.S. lawmakers.
If convicted on all counts, Bankman-Fried could face up to 115 years in federal prison.
5. — Damar Hamlin In Critical Condition After Suffering Cardiac Arrest During Monday Night Football
Buffalo Bills safety Damar Hamlin remains in critical but stable condition in a Cincinnati hospital Tuesday after suffering cardiac arrest during a game against the home-team Bengals Paycor Stadium last night.
Hamlin, 24, collapsed on the field in the early minutes of last night’s game between the Bengals and the Bills after tackling wide receiver Tee Higgins. Hamline remained on the field for several minutes after, receiving oxygen and CPR from team staff before being transferred to the University of Cincinnati Medical Center.
“Damar Hamlin suffered a cardiac arrest following a hit in our game versus the Bengals. His heartbeat was restored on the field and he was transferred to the UC Medical Center for further testing and treatment,” the Bills said.
The game, broadcast on Disney’s (DIS) – Get Free Report Monday Night Football, was immediately postponed following a conversation between head coaches Zac Taylor and Sean McDermott.