Stock futures are little changed as the market heads for big weekly losses: Live updates

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Market downside could be limited, Wells Fargo says

Wells Fargo’s Christopher Harvey said that, despite the recent market turmoil, losses could be kept in check thanks to resiliency in two key metrics.

“We continue to watch two key metrics for signs of an economic downturn: weekly claims (201k this week vs. 225k consensus; lowest since January) and IG spreads (now 1.16%, -3bps w/w and only slightly above the recent 1.12% low),” he said. “These two data points remain very well-behaved, suggesting to us limited near-term downside of 3-4% (at worst), or an SPX of ~4190 (the 200-DMA).”

The S&P 500 closed Thursday’s session at 4,330.

— Fred Imbert, Michael Bloom

Bank of Japan makes no change to rates, but notes ‘moderate recovery’ in economy

Japan’s central bank made no changes to its benchmark lending rate and yield curve control policy following its latest monetary policy meeting.

The central bank kept rates at -0.1%, and capped the 10-year Japanese government bond yield around zero.

At the last policy meeting in July, the Bank of Japan loosened its yield curve control to allow longer-term rates to move more in tandem with rising inflation. It was Ueda’s first policy change since assuming office in April.

Read the full story here.

— Lim Hui Jie, Clement Tan

Japan private sector activity expands at slowest pace since Feburary

Japan’s private sector activity expanded at its slowest pace since February, flash estimates from au Jibun bank show.

The flash composite purchasing managers index for Japan in September stood at 51.8, down from August’s figure of 52.6.

Manufacturing PMI showed a faster contraction, at 48.6 compared with 48.9 in August while services PMI came in at 53.3 for September, a softer expansion than the 54.3 in the month before.

A PMI reading above 50 indicates expansion in the sector, while a reading below 50 indicates contraction.

— Lim Hui Jie

Japan August inflation rate at 3.2%, above BOJ target for 17th straight month

Japan’s headline inflation rate came in at 3.2% for August, slightly slower than the 3.3% seen in July and the 17th straight month that inflation has went above the Bank of Japan’s 2% target.

The core inflation rate, which strips out prices of fresh food stood at 3.1%, unchanged from the July figure and slightly higher than the 3% expected by economists polled by Reuters.

The so-called “core-core” inflation rate, which excludes prices of both fresh food and energy and is used by the BOJ in its monetary policy considerations, was at 4.3%, unchanged from July.

— Lim Hui Jie

Individual investor bullishness slides to four-month low in latest AAII weekly survey

Bullish sentiment toward the six-month outlook for stocks dropped to a 16-week low of 31.3% from 34.4% previously in the latest weekly survey from the American Association of Individual Investors. Optimism has stood below the historical average of 37.5% for five of the past six weeks.

Bearish opinion climbed to 34.6% — the highest in a month — from 29.2% last week, and above the historical average of 31.0%.

Neutral sentiment of 34.1% was down from 36.4% last week and above the historical average of 31.5% for a second straight week.

Contrarian investors like to see bullish opinion decline and negative views increase, the idea being that optimists have already bought stocks and have less cash on the sidelines available to push prices higher, while bears have yet to buy and are holding dry powder they can eventually put to work in the market.

— Scott Schnipper

It’s time to lock in bond duration, Ritholtz Wealth Management’s Josh Brown says

Consider adding longer-dated Treasury exposure as bond yields turn higher, says Josh Brown, CEO of Ritholtz Wealth Management.

“What’s changed over the last couple of weeks is we’ve made the decision that all things being equal, you don’t have as much daylight anymore between let’s say a 3- or 6-month T-bill versus a 3- to 7-year Treasury bond ETF,” said Brown, speaking on CNBC’s “Halftime Report” Thursday. He added that he has made that shift for clients, noting that “we do want to lock in the current relatively high yields.”

Duration refers to a bond’s price sensitivity to changes in rate policy. Issues with longer maturities tend to have greater duration. Bond prices and yields also have an inverse relationship.

“It’s not because we think we’re at the end of the hiking cycle,” Brown said. “We are comfortable locking in these rates and not having to worry about eventual rate cuts, whether they start in mid ’24, late ’24 or beyond.”

-Darla Mercado

WW shares tumble after Oprah Winfrey says weight loss drugs seem like ‘the easy way out.’

When Oprah Winfrey talks about dieting, people listen.

During an online panel Wednesday that included obesity doctors, Winfrey admited that she considered taking popular weight loss drugs Ozempic and Wegovy, but opted not to because she thought it would be the “easy way out.”

Winfrey is a board member and shareholder of WW International, and shares of the Weight Watchers parent slid slightly in extended trading Thursday. During the regular session, the stock lost nearly 16% of its value.

Although Weight Watchers still operates its traditional weight loss program, the company recently purchased telehealth company Sequence, which offers new GLP-1 obesity drugs that have shown to help people shed 15% or more of their weight. Those on these medications report they have fewer food cravings and feel full longer when they do eat. WW stock has gained more than 150% since the start of the year, but still about 28% below its 52-week high.

—Christina Cheddar Berk

Market heads for another down week

All three major averages suffered a negative session Thursday, adding to their week-to-date losses.

  • The Dow fell 1.1%, suffering its worst daily performance since Aug. 24 and third negative session in a row.
  • The Dow is down 1.6% week to date, on pace for its worst weekly performance since Aug.18 and second negative week in three.
  • The S&P 500 fell 1.6%, posting its worst daily performance since March 22 and third negative session in a row.
  • The S&P is down 2.7% week to date, on pace for its worst weekly performance since March 10 and third negative week in a row.   
  • The Nasdaq Composite fell 1.8%, posting its worst daily performance since Aug. 24 and third negative session in a row.
  • The Nasdaq Composite is down 3.5% week to date, on pace for its worst weekly performance since March 10 and third negative week in a row.

— Yun Li, Christopher Hayes

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