European markets were flat as global investors awaited the central bank
Morgan Stanley says the ‘smart’ EV is the next big thing in technology. Here are its top stock picks
Morgan Stanley says technology supply chains are poised to experience growth in the next big thing: smart technology features — from EV batteries to chips and self-driving technology.
The investment bank has named its top stock picks to benefit from the trend.
– Weissen Don
The central bank’s Kashkari says his biggest fear is that inflation will be more stable or warmer than expected.
Neil Kashkari, president of the Federal Reserve Bank of Minneapolis, said his biggest fear is that markets are underestimating how high or how persistent inflation will be, and that the central bank will need to be more aggressive than expected.
“The big fear that I have in the back of my mind is that if we’re wrong and the markets are wrong, this inflation is much more embedded than we appreciate or the markets appreciate,” he said. Inflation is expected to decline to 2% over the next two years.
“Then, to bring inflation back up, we will have to be more aggressive than I expect,” he said at an event at the University of Pennsylvania.
Kashkari pointed to supply-side shocks accounting for “half to two-thirds” of the country’s high inflation.
“The more support we get from the supply side, the less the central bank has to do, and the more we can avoid a hard landing,” he said. However, he said there is some evidence that supply chains are beginning to normalize.
Kashkari is already considered the most dovish of the U.S. central bank’s 19 policymakers, and expects the central bank to raise its policy rate — now in the target range of 2.25% to 2.5% — by another two full percentage points by the end of next year.
– Jihye Lee
CNBC Pro: Citi names energy stock ‘strong balance sheet’
The energy sector has been a big hit in a volatile stock market this year.
According to Citi, the stock still stands out for its “strong balance sheet”. It delivered a set of second-quarter earnings that handily beat its major listed peers.
Pro subscribers can Read the story here.
– Javier Ong
A hawkish fed?
Many are expecting a hawkish speech from Fed officials later this week, which will sell off risk assets. Some fear that the central bank’s continued and aggressive tightening will push the slowing economy into recession.
“I fully expect Fed Chair Jay Powell and other central bank officials to remain hawkish,” Invesco chief global market strategist Christina Hooper said in an email. “Aggressive rhetoric should be prepared for short-term volatility as markets walk on eggshells.
– Yun Li
Nordstrom shares fell
Shares Nordstrom The company fell more than 13% in extended trading after the company Lowered full-year financial forecast. Nordstrom said it is being challenged by excess inventory and sluggish demand.
“Customer traffic and demand has decreased significantly since late June, mainly at Nordstrom Rack,” CEO Eric Nordstrom said in a press release.
However, the company reported fiscal second-quarter earnings and sales ahead of analysts’ estimates.
– Yun Li
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