David Fuller and Eoin Treacy's Comment of the Day
Category - General

    Fed Raises Rates as Powell Keeps Options Open for Future Hikes

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    Officials will be looking for moderate growth, cooling inflation and supply and demand coming into better balance, particularly in the labor market, as they assess whether and when to raise rates again, Powell said.

    “What our eyes are telling us is policy has not been restrictive enough for long enough to have its full desired effects,” he said. “We intend again to keep policy restrictive until we’re confident that inflation is coming down sustainably to our 2% target, and we’re prepared to further tighten if that is appropriate. And we think the process still probably has a long way to go.”

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    LVMH Drops Most in Year as Results Stoke US Worries

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    Mixed set of results with the stronger-than-expected recovery in China offsetting the decline in cognac, mainly in the US

    “Demand for entry-price leather goods, jewelry and cognac from US aspirational customers will not recover immediately and visibility for the rest of the year remains low,” notably due to an uncertain macro-economic environment in China.

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    Rolls-Royce Stock Surges as Turnaround Under CEO Takes Hold

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    The upbeat outlook is a vindication for Chief Executive Officer Tufan Erginbilgic, who is in the middle of an extensive turnaround after calling the prime UK manufacturer a “burning platform” shortly after taking over at the start of the year.

    The company, which primarily makes engines for widebody jets that connect long-haul destinations, saw demand wiped out at the height of the pandemic when airlines were forced to ground fleets amid travel restrictions and quarantines. 

    “Better profit and cash generation reflects greater productivity, efficiency and improved commercial outcomes,” Erginbilgic said in the statement. “Despite a challenging external environment, notably supply chain constraints, we are starting to see the early impact of our transformation in all our divisions.”

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    Xi's China Markets Lifeline Raises Hope Rally Can Hold This Time

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    They’re betting a more forceful pro-growth tone from the top will be enough to fuel a tradeable rally — and may auger more success in tackling China’s wide array of challenges from mountains of local government debt to a slumping housing market.

    “Clearly, markets have been disappointed as they anticipated more rapid improvements, but they are now beginning to rationalize their growth expectations,” said Andrew McCaffery, global chief investment officer at Fidelity International. “Our view is that this somewhat unexciting period will eventually give way to a more positive market tone.”

    The big question is whether the follow-through from authorities will sustain the rebound. Brief bursts of optimism as China emerged from strict Covid restrictions have repeatedly turned into losses, making Chinese markets among the region’s worst performers amid a stream of grim economic data.

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    Jaguar Land Rover Owner Tata Beats Profit Estimate With Ease

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    Tata Motors Ltd. reported better-than-expected first-quarter income as supply-chain constraints eased, helping to lift sales of luxury cars.

    Net income was 32 billion rupees ($391 million) in the three months through June, compared with a loss of 50 billion rupees a year earlier, the Mumbai-based company said in a statement Tuesday. Analyst estimates on average were for net profit of 24.5 billion rupees.

    Luxury unit Jaguar Land Rover posted a quarterly profit before tax of £435 million ($559 million), compared with a loss of £524 million the year before. JLR’s quarterly revenue surged 56% to £6.9 billion, Tata Motors said. It reported a free cash flow of £451 million.

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    Unilever Shares Gain on Resilient Demand as Inflation Cools

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    Investors are scrutinizing the first set of results presented by Chief Executive Officer Hein Schumacher for hints of his strategy to revive Unilever’s sluggish performance. The new CEO, weeks into the job, raised the full-year forecast slightly, predicting revenue growth of more than 5% this year. The guidance may be conservative, as analysts are forecasting 6.1%.

    The company chose an external CEO to help fix its bureaucratic culture and deal with critiques that it had become too focused with the so-called “social purpose” of the consumer products it sells. 

    Schumacher, the former boss of Dutch dairy cooperative Royal FrieslandCampina, is expected to revisit the debate over splitting food brands like Hellmann’s mayonnaise from the faster-growing personal care, beauty, and wellbeing units.

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    Ryanair Touts Lower Fares to Fill Planes as Costs Start to Bite

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    Chief Executive Officer Michael O’Leary previously said that ticket prices would remain elevated for the next five years because of higher oil prices and environmental charges. Ryanair, which has built its business model around ultra-cheap flights, said in May the typical €9.99 ($11) fare could double in price as summer demand skyrockets and because of a supply backlog caused by a shortage of planes.

    The proposed fare stimulus comes as Ryanair expands its fleet with plans to take on an additional 173 aircraft by the end of March. Ryanair, which had 558 aircraft on June 30, announced a deal this year for as many as 300 Boeing 737 Max jets worth $40 billion. It comes as the Irish firm targets 30% of the European air-travel market by 2034. 

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