MARKET MOVERS
- Consumer confidence rises for the first time in 2022. The consumer confidence index climbs to 107.2 from 105.7. Confidence deteriorated last fall after the delta and omicron viral outbreaks. Now rising inflation and the war in Ukraine are adding to the angst. The U.S. economy is still expanding at a steady pace, but the headwinds are growing from rate hikes to fresh Covid lockdowns.
- Sony launches a new PlayStation gaming subscription service to take on Microsoft. Sony is bundling its existing PlayStation Plus and PlayStation Now services into one single subscription service called PlayStation Plus. The new PlayStation Plus will arrive in June and comes in three tiers: Essential, Extra, and Premium. The move is viewed as Sony’s response to Microsoft’s Xbox Game Pass.
- Walmart stops selling cigarettes. After years of internal debate, Walmart is removing tobacco products from select stores in Florida, California, and elsewhere. At Walmart, sales of cigarettes are generally less profitable than some other items sold near the front of stores such as candy, according to the people familiar with the situation. It is also an operationally complex sale, eating into profits. Read more here.
- House prices rose nationwide in January. up 1.6 percent from the previous month, according to the FHFA HPI. House prices rose 18.2% from January 2021 to January 2022. Rising mortgage rates in January certainly reflect a major change from the past several years, but lending costs remain relatively low. The mortgage rate shift has not dampened upward price pressure from intense borrower demand and limited supply. Read more here.
- Apple's Oscars award altered the landscape for streaming video businesses. Apple won the best picture for CODA during the Oscars. Motley Fool's Tim Beyers says this will have every major studio thinking about how to amp up their streaming capabilities and distribution throughout the world because the economics of this industry has changed. Source(2:18)
WHAT TO WATCH
- JPMorgan: U.S. recession is unlikely, even as the bond market flashes warning signals. JPMorgan’s Kolanovic said it is not likely to occur in the short term, despite bond market signals. Recessions usually don’t start before inversion and the market typically peaks only a year afterward. The start of hikes is typically accompanied by some market volatility, but this initial weakness ultimately gets absorbed, and the market moves higher. Read more here.
- White House seeks to add restrictions on corporate stock buybacks. President Joe Biden’s administration is targeting U.S. corporate stock buybacks in his 2023 budget plan. Under Biden’s new legislation, company executives would be required to hold on to company shares for several years after receiving them and would be prohibited from selling in the years after a stock buyback.
- Food prices to soar 5% on average this year. It's marking the highest single-year surge since 2008, which is set to leave Americans forking out more for everyday food essentials. The USDA said it has raised its estimate following two months of price surges across many of the food categories. They attributed the price hike to the impacts of the conflict in Ukraine and the recent increases in interest rates by the Federal Reserve.
- Nielsen to go private in a $16 billion deal. Nielsen Holdings Plc has agreed to be acquired by a consortium including Evergreen Coast Capital Corp., an affiliate of Elliott Investment Management, and Brookfield Asset Management Inc. The consortium has fully committed debt and equity financing and there are no financing conditions for the closing, which is expected in the second half of the year.
- The Biden administration plans to throw money at the housing crisis. The plan is to increase the U.S. Department of Housing and Urban Development’s funding by 21% bringing it to $71.9 billion. The aim is to expand rental assistance to more low-income tenants struggling to pay their landlords, increase the number of affordable housing units available, and help more Americans become homeowners. Read more here.
- Porsche is working on an all-electric 911. The electric 911 could be powered by solid-state batteries supplied by QuantumScape, according to a report from Electrek, citing an article from the German news outlet Manager Magazin. Quantum and Porsche Automobil didn’t immediately respond to requests for comment. Porsche said in mid-March it wants to have 80% of its sales come from all-electric cars by the end of the decade.
- The Fed needs to engineer a recession, says Jared Dillian. That would get inflation down. But what the Fed wants is to bring inflation down without causing recession which is a soft landing. There's absolutely no scenario here where you can get a soft landing. Either you're going to have a recession or you're going to have CPI printing above 10%. Source(9:40)
