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The World
Stocks Slip as Nasdaq Falls to Its Lowest Level in More Than 2 Years: The tech-heavy index dropped 1% to its lowest point since July 2020, as concerns about Federal Reserve tightening, escalation in the Ukraine war, and China-trade policy shook markets. (Wall Street Journal)
Ukraine war at a turning point with rapid escalation of conflict: Both the nature and tempo of the war have changed in recent weeks, as Ukraine’s forces score victories on the ground and Russia retaliates as Putin is backed into a corner. (Washington Post)
The UAE’s president is to meet Vladimir Putin in Moscow as the Russian leader steps up his attacks on Ukraine with a series of missile strikes. The visit of Sheikh Mohammed bin Zayed al-Nahyan, known as MBZ, follows last week’s decision by the Opec cartel and allied producers including Russia to cut the group’s daily production target by 2mn barrels. The move, designed to boost global oil prices, will help Moscow financially, further undermining strained relations between Washington and its traditional Gulf allies. (Financial Times)
Ukraine vowed to strengthen its armed forces after Russia launched its biggest aerial assaults on cities since the beginning of the war, forcing thousands to flee to bomb shelters and prompting Kyiv to halt electricity exports to Europe. (Reuters)
China's Shot at Overtaking the US Economy Is at Stake in Xi's Next Term: At the once-every-five-year Communist Party congress this month, where President Xi Jinping is set to secure rule until at least 2027, policies on the table will help determine how quickly China surpasses the US economy, or whether it ever will. Bloomberg Economics has sketched out four scenarios for China’s economy over the decades ahead, with a base case of 4.6% growth on average over the next decade. Their model suggests a growth rate above 5% over that time period — as predicted pre-pandemic — is now out of reach, due to the lasting impact of Covid Zero policies, a faster decline in fertility than previously expected and lower investment due to a gradually shrinking real estate sector. (Bloomberg)
A top Democratic senator is vowing to block all future weapons sales to Saudi Arabia and urging the Biden administration to “immediately freeze all aspects” of U.S. cooperation with the kingdom in response to its decision to cut oil production amid a global energy crisis set off by Russia’s war in Ukraine. The message from Senate Foreign Relations Chair Bob Menendez (D-N.J.), who has veto power over foreign arms sales, comes amid the West’s outrage at OPEC+ for slashing its oil output — a move that the U.S. and other allied governments saw as a gift to Moscow as it suffers significant losses on the battlefield in Ukraine. (Politico)
Brazilian presidential candidate Luiz Inacio Lula da Silva slightly broadened his lead over incumbent President Jair Bolsonaro ahead of the Oct. 30 runoff vote, according to a survey by pollster IPEC published on Monday. Lula's voter support reached 51% against 42% for Bolsonaro, compared with 51% and 43%, respectively, in the previous poll. The survey by IPEC interviewed 2,000 people on Oct. 8-10 and has a margin of error of 2 percentage points up or down. IPEC was one of several polling firms criticized for underestimating support for Bolsonaro in the first-round vote early this month. (Reuters)
A California city’s water supply is expected to run out in two months: Officials project drought-stricken Coalinga, Calif., will use up its allotted amount of water before the end of the year — possibly forcing the city to buy water at exorbitant prices. (Washington Post)
"There's just not enough water": California drought hits grocery stores. (Axios)
Economy
‘This is serious’: JPMorgan’s Jamie Dimon warns U.S. likely to tip into recession in 6 to 9 months. JPMorgan Chase CEO Jamie Dimon said the U.S. economy was “actually still doing well” at present and consumers were likely to be in better shape compared to the 2008 global financial crisis when the world tips into recession. “But you can’t talk about the economy without talking about stuff in the future — and this is serious stuff,” Dimon said. His comments come at a time of growing concern about the prospect of an economic recession as the Federal Reserve and other major central banks raise interest rates to combat soaring inflation. (CNBC)
Paul Tudor Jones believes we are in or near a recession and history shows stocks have more to fall. (CNBC)
Oil falls by nearly 2% as recession fears outweigh tight supply prospects. (Reuters)
Retailers Kick Off Black Friday in October Again: Target and Walmart are rolling out early deals this week in a bid to attract holiday shoppers, as the retail industry works to unload excess inventory and compete with Amazon. (Wall Street Journal)
Retailers’ stockpiles mean deep holiday discounts starting now: After struggling with shortages for much of the pandemic, the retailers are now facing the opposite problem: A glut of unsold merchandise that’s cutting into profits, derailing holiday plans and threatening to drag down economic growth. (Washington Post)
A sell-off in UK government bonds pushed the country’s long-term borrowing costs to their highest point since the Bank of England stepped in to avert a financial market collapse, as new BoE and government measures failed to reassure investors. Monday’s fall in gilts came despite the BoE announcement earlier in the day of a new short-term funding facility to avoid a “cliff edge” when the central bank’s £65bn emergency bond-buying program ends this week. (Financial Times)
Former Fed Chair Bernanke shares Nobel for research on banks. (Politico)
Technology
PC Shipments Plunge 20%, Steepest Drop in More Than 20 Years: Demand for personal computers fell by the fastest pace in over two decades as back-to-school promotions failed to reignite sales. (Wall Street Journal)
Tech war: China’s chip self-sufficiency drive under siege as new US export controls tighten access to advanced semiconductors. The US has further restricted China’s ability to obtain the latest computing chips, develop supercomputers and manufacture advanced semiconductors. Washington has also added new licence requirements for items destined to Chinese chip foundries. (South China Morning Post)
China chip sector shares tumble on U.S. export curbs. (Nikkei Asia Review)
What the Netflix-Disney Stock Price Gap Tells Us: We’re barely a week away from the start of tech earnings season, when Netflix reports its third-quarter numbers. Investors are feeling bullish: Netflix shares have rallied 30% since mid-July, roughly when the company reported it had lost fewer subscribers in the second quarter than it had projected. That supposedly “better than expected” result was a classic example of a company underpromising and overdelivering. Wall Street falls for it every time. Since then, though, a stream of incremental news reports about Netflix’s plans for its ad-supported tier has buttressed investor confidence. Investors just can’t shake their Netflix addiction. Notably, they don’t have the same warm feelings about Walt Disney Co., which is also introducing an ad-supported tier for its Disney+ streaming service later this year. Unlike Netflix, Disney stock is roughly where it was in mid-July. That means it is once again trading at a meaningful discount to Netflix on a multiple of next year’s expected sales, a return to a longstanding situation after a brief period in June when the two stocks almost converged in valuation, according to Koyfin. That raises a question: Are buyers too optimistic about Netflix or too downbeat about Disney? (The Information)
Websites for a handful of U.S. airports, including those in Atlanta, Chicago, New York and Los Angeles, were taken offline during a cyberattack, although officials said there was no effect on flight operations. Managers at multiple airports said they notified the FBI and the Transportation Security Administration about the cyberattacks. In a statement, the FBI said it was aware of the incident but had no additional information. The TSA declined to comment, referring inquiries to individual airports. (Washington Post)
Shares in Amazon-backed electric truckmaker Rivian tumbled more than 7 per cent to a three-month low after it announced a recall of almost all of its vehicles due to a defect. (Financial Times)
Podcast
From Call In, a podcast highlighting inclusive leadership in action:
Inclusive Leadership and Hispanic Heritage Month: Peter Muñiz of Home Depot Peter Muñiz, Vice President and Deputy General Counsel at The Home Depot, Inc., offers lessons and insights on leadership and empathy — and, in recognition of Hispanic Heritage Month — ways to honor Latin colleagues and create an inclusive workplace. (Call In Podcast)
Smart Links
Large rail union rejects deal, renewing strike possibility. (Associated Press)
YouTube to broadly support the @username format with launch of YouTube handles. (TechCrunch)
Airlines are adding more flights in Asia. Here’s how that may affect airfares. (CNBC)
Transatlantic jobs market ‘coming off the boil’ as vacancy numbers drop. (Financial Times)
Carvana Pushes Back After Michigan Suspends Dealership Operation. (Bloomberg)
42% of Americans say money negatively impacts their mental health. (CNBC)