GoAI Market Morning Wrap - 14th Nov

Stock Market  

Eastern Time Thursday, U.S. three major indices all fell, AI leader Nvidia and other heavyweight tech stocks faced heavy selling. As Fed rate cut expectations plunged, overall market sentiment clearly under pressure.  

 

U.S. government resumed operations after record 43-day shutdown, which had worried investors and disrupted economic data releases.  

 

White House economic advisor Kevin Hassett that day said government will release October key jobs report on schedule, but due to weeks-long federal shutdown, report will exclude unemployment rate data.  

 

Recently, more Fed officials hesitant on further cuts, pushing financial markets' December cut bets to near 50%. Fed cut twice this year, but many officials recent speeches emphasize inflation pressures remain, labor market resilient.  

 

Earlier intraday, Cleveland Fed President Beth Hammack said rate policy should remain restrictive to exert downward pressure on still-worrying inflation.  

 

San Francisco Fed President Mary Daly claimed too early to judge if Fed should cut in December meeting.  

 

Per CME FedWatch tool, traders now see ~47% chance December 25 bps cut, sharply down from last week's 70%.  

 

Longbow Asset Management CEO Jake Dollarhide: "Core issue is whether tariff-induced inflation temporary, one-off, or persistent? Fed officials hesitant on further cuts precisely due to this uncertainty. Cut or not, both risks for market."  

 

Investors continued selling tech stocks, especially AI-related, due to valuation concerns.

 

Sparta Capital Securities chief market economist Peter Cardillo: "Market undergoing healthy but painful AI sector correction, while completing rotation from tech overweight to defensive neutral."  

 

BMO Private Wealth chief market strategist Carol Schleif: "Though we always expected many data missing during shutdown to be absent long-term, once inflation and jobs data back online, their performance still questionable. As government restarts, economic data machine reboots, expect some volatility next few weeks."  

Global Hotspots  

Fed's Kashkari says opposed last cut, undecided on December meeting  

 

Minneapolis Fed President Kashkari said he opposed Fed's last rate cut, but undecided on December policy meeting action. "Market feedback and data signs show underlying economic resilience beyond my expectations," Kashkari Thursday interview.

 

Says this indicates Fed should have paused in October meeting. Kashkari says subsequent data shows economic conditions "basically unchanged." For upcoming December 9-10 rate decision: "I can make case for cut based on data, or hold rates, we'll see." Kashkari no vote on rates this year but participates in FOMC deliberations.  

 

White House official: U.S. government "shutdown" caused ~60,000 private sector job losses  

 

White House NEC director Kevin Hassett local time November 13 said due to output reduction, U.S. government "shutdown" may lead to 60,000 private sector job losses. Hassett says CEA latest estimate shows "shutdown" economic losses up to $15 billion weekly.

 

Next few weeks, with jobs reports and unemployment claims data release, labor market clearer. Hassett says expect overall employment data soon.  

 

U.S. to exempt tariffs on some Latin American coffee  

 

U.S. government officials Thursday said reached trade deals with some Latin American countries, including tariff exemptions on some coffee and fruit exports. Coffee become symbol of affordability crisis in public evaluation of Trump administration economic policy, like eggs under Biden.

 

September coffee price gains topped all goods and services in CPI. Treasury Secretary Bessent earlier this week promised coffee price relief soon. U.S. government Thursday announced framework agreements with Argentina, Ecuador, El Salvador, Guatemala, including tariff exemptions on some non-U.S. grown products, examples Ecuador coffee and bananas.  

Company News  

Apple launches Mini Apps Partner Program: App Store cut sharply to 15%  

 

Local time Thursday, tech giant Apple announced for some app developers, App Store cut from 30% to 15%, but developers must join new "Mini Apps Partner Program." Per program, to enjoy lower cut, developers must deeply integrate Apple official software tech in development.

 

For example, use Apple system to record user purchase history, verify user age, process in-app payments via Apple official channels. This adjustment latest compromise to App Store business model under regulatory pressure and legal challenges. Recent years, European regulators and U.S. courts rulings require Apple relinquish absolute App Store control, lower platform cut. Currently, in most countries, App Store still only official channel for iPhone users to install software.  

 

Tesla testing support for Apple "CarPlay" in-car system  

 

Famous Apple leaker Mark Gurman latest post says Tesla developing support for Apple "CarPlay" in-car system for vehicles—one of most requested owner features. Gurman writes insiders reveal Tesla internally started testing feature, project still confidential.

 

CarPlay is Apple iPhone interface optimized for in-car entertainment. Users can find routes, send/receive messages, play music, while focusing on road. Currently, CarPlay supported by most automakers, seen as "must-have" by many drivers. If Tesla ultimately introduces CarPlay, marks major shift in company and CEO Elon Musk attitude.  

 

Boeing union vote ends company's second-longest strike in history  

 

Boeing St. Louis area factory workers voted to accept company's latest five-year contract proposal, ending aircraft manufacturer's longest strike since 1948. 3,200 members of IAM District 837 to return November 16. After rejecting four proposals, workers finally accepted terms: average total wage increase 24%, $6,000 signing bonus.

 

Strike started August 4, drew criticism from Missouri Senator Josh Hawley and Vermont Senator Bernie Sanders, disrupted military aircraft production including F-15EX. Second-longest strike in Boeing 106-year history. Next, company faces more negotiations, union contract for 19,000 engineers and technical workers expires October next year.  

Forex & Commodities  

COMEX gold futures closed down 0.93% to $4,174/oz; COMEX silver futures down 2.3% to $52.23/oz.  

 

WTI crude futures up 0.19% to $58.60/barrel; Brent crude up 0.27% to $62.88/barrel.  

 

USD index against six major currencies down 0.34% that day, closed FX tail 99.156.  

Key Events  

EU considers pooling non-U.S. countries' dollar reserves to reduce Fed dependence  

 

Reports say European financial stability officials discussing pooling dollar reserves held by non-U.S. central banks to create alternative Fed liquidity support mechanism. Aim to reduce dependence on U.S. during Trump administration.

 

Consultations still at working group level, not reached ECB decision-makers, involves multiple central banks inside and outside eurozone.  

Cryptocurrency  

Bitcoin 24h down 2.25% to 99,565.66.  

 

Ethereum down 5.59% to $3,230.87.  

 

XRP down 2.83%, BNB down 2.93%, Solana down 6.29%.  

 

Dogecoin down 3.79%, Cardano down 3.07%.  

Key Events  

Morgan Stanley: Bitcoin at "autumn" end, crypto cycle may turn  

 

Bitcoin price still oscillating, no breakout yet, Morgan Stanley Wealth Management strategist Denny Galindo used four seasons to describe crypto cycle, thinks currently in autumn, but whether autumn end, or prolonged? Core debate in crypto circle.  

 

Morgan Stanley latest "Thoughts on the Market" podcast, two analysts discuss crypto trends. Galindo points out for crypto, macro explanation really M2 money supply cycle. Global M2 shows four-year acceleration/deceleration pattern, Bitcoin highly correlated, tends up when M2 accelerates, down when decelerates or falls.