Morning Brief: Powell expects Fed to raise rates further
Tuesday, November 28, 2017
What to watch today
Investors should see a pick-up in the economic and earnings news on Tuesday as the Dow sits at a record high. Home price data from S&P/Case-Shiller for September along with the November consumer confidence numbers from The Conference Board will be the economic highlights of the day. On the earnings side, results from AutoDesk (ADSK), Marvell Technology (MRVL), and Nuance Communications (NUAN) will be headliners.
All eyes will be on Washington Tuesday morning for Fed chair nominee Jerome Powell’s confirmation hearing before the Senate Banking Committee. In prepared remarks, Powell said the Fed expects “interest rates to rise somewhat further and the size of our balance sheet to gradually shrink.”
Elsewhere, investors will of course keep their eye on the price of bitcoin, which on Monday was trading near $9,600. Ken Griffin, the billionaire founder of hedge fund Citadel, told CNBC on Monday that, “Bitcoin right now has many of the elements of the tulip bulb mania we saw back hundreds of years ago in Holland.”
Top news
Mulvaney appears to be the new CFPB chief: On Monday morning, Mick Mulvaney, the Office of Management and Budget (OMB) director, and Leandra English, the newly appointed deputy director of the Consumer Financial Protection Bureau (CFPB), claimed to start their first day as head of the agency. While both Mulvaney and English sent emails to the staff signed “acting director,” it appears that Mulvaney, who arrived at the bureau with doughnuts in tow, has the upper hand and is being treated as acting director. [Yahoo Finance]
Wells Fargo bankers, chasing bonuses, overcharged clients: The whispers among employees had been around for years. They finally heard some facts during a conference call in June led by managers in Wells Fargo & Co.’s foreign-exchange operation: Some of its business customers had been cheated. [The Wall Street Journal]
SoftBank offers to buy Uber shares at 30% discount: Japan’s SoftBank Group Corp is offering to purchase shares of Uber Technologies Inc. at a valuation of $48 billion, a 30% discount to its most recent valuation of $68.5 billion. The investment would also trigger a string of governance changes at Uber that would limit some early shareholders’ voting power, expand the board from 11 to 17 directors and cut the influence of former Chief Executive Travis Kalanick. [Reuters]
OPEC to back 9-month extension, awaits Russia: All OPEC members support extending their oil production cuts until the end of 2018, although Russia hasn’t yet committed to the proposal before Thursday’s meeting in Vienna, said people familiar with the matter. [Bloomberg]
Cyber Monday sales jump 17%: Cyber Monday was on track to become the biggest-ever internet shopping day in the United States as people snapped up bargains on toys and electronics, with many more buying from their phones. The shopping event is expected to generate $6.6 billion in sales, up from $5.6 billion a year ago, according to Adobe Analytics. [Reuters]
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