WHAT IS HAPPENING?! | TRIZAN BUSINESS NEWS - Sept 19, 2024

Good Evening. Traders are cautiously optimistic as the Federal Reserve’s pivotal meeting begins today, with hopes pinned on a smooth economic transition. Canadian Prime Minister Justin Trudeau is facing a significant political setback, and Stanford University continues to lead in business school rankings.

Market Watch

The Federal Reserve's much-anticipated two-day meeting starts today. Traders are looking for Jerome Powell to replicate Alan Greenspan's 1995 strategy and achieve a rare "soft landing" for the economy. This optimism is reflected in rising investor sentiment, marking the first positive shift since June, according to a recent Bank of America survey. However, not all analysts share this bullish outlook. Apollo Global Management has warned that investors might be overly optimistic about the potential for multiple Fed rate cuts over the next year, suggesting that market expectations might be too high.

Political Landscape

In politics, Canadian Prime Minister Justin Trudeau has suffered a significant setback following a loss in a special election. This defeat has intensified speculation about whether Trudeau will step down before the national election scheduled for 2025. The loss places increased pressure on Trudeau and his party as they navigate the path forward.

Spotlight: Business School Rankings

Stanford University has once again topped Bloomberg Businessweek’s annual ranking of the best business schools, securing the top position for the sixth consecutive year. While the top rankings have shown stability, there have been notable shifts further down the list. Carnegie Mellon University's Tepper School of Business has surged to ninth place from eighteenth, reflecting a significant improvement in its standing. Conversely, Columbia Business School has dropped to seventeenth place from fifth, highlighting the dynamic nature of the business education landscape. These changes underscore the rapidly evolving environment in business education.

Corporate News

Microsoft: The tech giant has unveiled a $60 billion stock repurchase program, equaling its largest-ever buyback authorization. Additionally, Microsoft has increased its quarterly dividend by 10%, signaling confidence in its financial stability and long-term growth prospects.

BlackRock: The world’s largest asset manager is revamping its private credit business as it aims to close the gap with its competitors. This strategic move reflects BlackRock’s commitment to strengthening its position in the competitive landscape of private credit.

Hedge Funds: Leading hedge funds, including Brevan Howard and Millennium Management, are expanding their teams of Japan-focused traders. This increase in staffing highlights the growing interest and strategic focus on the Japanese market amid shifting global investment landscapes.

Political Drama

Donald Trump has accused Democrats of using “highly inflammatory language” that he claims inspired an attempted assassination against him over the weekend. The suspect, a 58-year-old American supporter of Ukraine, has been charged with federal gun law violations after allegedly brandishing an assault rifle and lurking near Trump’s Mar-a-Lago resort. This incident has intensified discussions about the safety of public figures, with the Secret Service having thwarted numerous assassination attempts throughout history, most of which did not result in injury. Citigroup has noted that the political platforms of both presidential candidates could negatively impact U.S. equities.

What Else Is Happening

Intel: The company’s stock surged after securing Amazon’s AWS as a major customer for its AI chips, potentially bringing significant business to new U.S. manufacturing plants and boosting CEO Pat Gelsinger’s efforts to revitalize the company. In response, Intel has postponed the construction of new factories in Germany and Poland.

Bond Market: Bond traders are experiencing unprecedented uncertainty ahead of the Federal Reserve’s upcoming meeting, with debate centered around whether the Fed will implement a 25 or 50 basis-point rate cut. The situation is further complicated by calls from some Democratic senators for a 75 basis-point reduction.

Tupperware: Shares plunged 58% after reports indicated that the company might file for bankruptcy within the week.

Amazon: The tech giant will require employees to return to the office five days a week starting January 2.

TikTok: The social media platform is challenging a potential U.S. ban in appeals court.

Boeing: The aerospace company has frozen its hiring plans as it prepares for a potential strike.

Cherry: The financial firm is exploring investor interest for a bond tied to “buy-now, pay-later” loans for cosmetic surgery.

Opinion

John Authers explores the high stakes of investing ahead of the Federal Open Market Committee (FOMC) decision, emphasizing that expectations for a 50 basis point rate cut could lead to pressure for even more significant reductions. Authers suggests that Powell may be in a position to challenge the market's assumptions and potentially shift expectations.

Features

The cost of child care for an average U.S. family of four now exceeds housing expenses, yet neither Kamala Harris nor Donald Trump has provided detailed plans for alleviating the financial burden on parents, who can spend up to $33,000 annually on child care.

Policy Watch

In Canada, embattled Prime Minister Justin Trudeau is introducing 30-year mortgages for first-time buyers and those purchasing newly built homes, in a bid to regain favor with younger voters.

Thank you for reading our article. Have a wonderful evening!

-THE TRIZAN BUSINESS NEWS TEAM