Here are the most important news items that investors need to start their trading day:
1. Fresh start, or same problems?
Welcome to the fourth quarter. It’s been a rough year for stocks, and it doesn’t look like markets’ luck will turn around dramatically, if at all, during the final three months. All three major averages on Friday closed out a losing quarter and a losing month, with the Dow closing below 29,000 for the first time since November 2020. They have all suffered three consecutive losing quarters as well. Can it get any more grim, at least for stocks? The economy is still running hot despite the Federal Reserve’s best efforts to cool it off with an aggressive rate-hike plan. Read live market updates here.
Read more from CNBC PRO: The fourth quarter starts now, and it’s not looking good for the economy
2. U-turn in the UK
Tax cuts? What tax cuts? UK Prime Minister Liz Truss, in a stunning reversal, has backed off her new government’s plan to dramatically reduce the tax rate for the richest Britons. The nation has been struggling with a cost-of-living crisis, and critics saw the tax cut as a giveaway to the wealthy. Truss and Finance Minister Kwasi Kwarteng, in backing away from the policy shift, said the tax cut had become a “distraction.” It was more than that, though. Markets overwhelmingly rejected the plan, sending stocks and the pound tumbling. That, in turn, forced the Bank of England to intervene with a temporary bond purchase program. There’s still more work to be done, though, analysts say. “Although U.K. assets are reacting well to the U-turn, they are far from being out of the woods,” said Jane Foley, senior FX strategist at Dutch bank Rabobank.
3. Tesla deliveries jump
Electric vehicle leader Tesla said it delivered more vehicles in the third quarter than it did during the same period a year ago. The Elon Musk-led company said it delivered 343,000 vehicles, compared with 254,695 deliveries in the third quarter of 2021. Deliveries are considered the closest reflection of sales by Tesla. Analysts had expected 364,660 deliveries. Tesla, like other automakers, has had to contend with higher production costs and supply-chain issues. Its new factories in Texas and Germany have also been the source of some headaches: Musk has called them “gigantic money furnaces.”
4. Ukraine wins back key city
Russia’s already-dubious annexation of certain parts of Ukraine isn’t going so well. Soon after Russian President Vladimir Putin illegally claimed four regions in Ukraine, Ukrainian forces recaptured Lyman, a critical transportation and shipping hub in the eastern part of the country. They’ve also seized territory in the surrounding areas, according to President Volodomyr Zelenskyy. UK intelligence is showing that Putin’s recent mobilization of about 300,000 reservists to join the war effort is a flop, too. “Putin’s unusually rapid acknowledgement of problems highlights the dysfunction of the mobilisation over its first week. Local officials are likely unclear on the exact scope and legal rationale of the campaign,” Britain’s Defense Ministry said on Twitter. Read live updates about the Ukraine war here.
5. Walmart’s subscription push
Walmart+ – the subscription service owned by Walmart – has been around for two years. It started during the pandemic, while people were still wary of venturing out to shop. It offers free deliveries and shipments, as well as discounts. But who needs another subscription, when there’s already Amazon Prime and club memberships, such as the one offered by Walmart-owned Sam’s Club? While the company says sign ups and renewals have remained steady of late, the discount retailer and grocer believes it can make a bigger push during this time of surging inflation. “This is the time when Walmart shines,” said Chris Cracchiolo, the head of Walmart+. “This is what we do best. When there’s uncertainty, when there’s inflation, when customers are on really, really tight budgets.”
– CNBC’s Samantha Subin, Jenni Reid, Lora Kolodny, Holly Ellyatt and Melissa Repko contributed to this report.