Bloomberg - Evening Briefing - ‘Back in a bull market’

The day after the World Bank sounded the alarm about the global economy’s prospects for 2023, Edward Yardeni, the strategist who saw resilience in the US economy last year when almost everyone else was predicting recession, remains sanguine about where global financial assets including US stocks are headed. “The outlook for the world economy is actually improving,” the president and founder of Yardeni Research said Wednesday. US equities “made a low on Oct. 12. That was the end of the bear market and we’re back in a bull market.” Since closing at 3,577.03 that day, the S&P 500 has risen almost 10%, so maybe there’s something to that. —David E. Rovella

Money markets are pricing a US interest rate peak around 4.9%, followed by nearly half a percentage point of rate cuts by the end of this year. This despite multiple Federal Reserve officials delivering a sharply divergent message of late: Rates are heading above 5% and will stay there all year. Prominent fixed-income manager Jeffrey Gundlach said investors trying to figure out how the interest-rate situation will play out should pay attention to the bond market rather than the Fed.

BlackRock plans to fire about 500 employees, roughly 2.5% of its global workforce, after sharp declines in equity and bond markets. It’s the first round of job cuts for the world’s biggest asset manager since 2019, but it will still leave headcount about 5% higher than it was a year ago. Firms across Wall Street are holding back on hiring plans and paring staff amid the current economic uncertainty.

FTX Group advisers have found more than $5 billion in cash or crypto assets that it may be able to sell to help repay creditors, a lawyer for the company told the judge overseeing the biggest crypto bankruptcy yet.

A year ago this week, a record 109 container ships carrying US imports surrounded the twin ports of Los Angeles and Long Beach, California—a bottleneck so big that the payloads of all those metal boxes lined up end-to-end would’ve stretched from the Baja Peninsula to Vancouver. “It was like taking 10 lanes of LA freeway traffic and squeezing them into five,” Port of Los Angeles Executive Director Gene Seroka said in an interview. Now, that long line of ships is gone. So why did it take most of 2022 to clear the backlog? 

Saudi Arabia-financed LIV Golf denied allegations that it’s using a US antitrust lawsuit against PGA Tour to “build an intelligence file” on families of 9-11 victims who have been critical of the kingdom and its new professional golf circuit. Relatives of some of the almost 3,000 Americans killed on Sept. 11, 2001 in New York, Washington and Pennsylvania have long alleged Saudi complicity in the terrorist attack, which Riyadh denies.

Iran has upheld a death sentence for a former deputy minister with dual British nationality who was arrested for spying for the UK, state-controlled media said. Alireza Akbari, who served as a deputy defense minister during the presidency of reformist Mohammad Khatami, was accused of being “one of the most important agents” of Britain’s Secret Intelligence Service.

In a field long plagued by hype and high costs, carbon removal startups are starting to show real promise—in very small settings. The question is whether they can scale up in time. In this episode of Bloomberg’s The Spark, we send one of our reporters to Iceland, which thanks to some well-placed volcanoes, has fast become the world’s pre-eminent spot for technology that will be critical to any winning fight against global warming.

A direct-air capture and storage facility operated by Climeworks in Hellisheiði, Iceland. The startup is working with another company called Carbfix to store carbon dioxide removed from the air deep underground. Photographer: Arnaldur Halldorsson/Bloomberg

Bloomberg continues to track the global coronavirus pandemic. Click here for daily updates.

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During the car-buying frenzy of the early pandemic, the global auto industry enjoyed tremendous pricing power. In 2023, the market is set to skid off the road. Morgan Stanley warns that “we may be witnessing the sharpest pivot from undersupply to oversupply of light vehicles in a generation.” Bernstein echoed the message, seeing “cracks appearing in global pricing momentum.” In no segment of the auto universe are those cracks showing more clearly than in the used-car market.

Photo illustration: 731; Photos: Getty Images (4)

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Bloomberg’s Future Investor series comes to Chicago on Jan. 24, when we will explore the mindset of a new generation of investors, as well as the growth trends and technologies that hold the most promise. This event is sponsored by Invesco QQQ. Register here.