20 Dec

Week Ahead: US500 “Santa Rally” still in play?

By ForexTime 

  • US500 ↑ 23% year-to-date
  • December: Produced returns 70% of time since 1995
  • Gained on average 1% in December over past 30 years
  • Prices bearish on D1 but RSI oversold
  • Technical levels: 21-Day SMA,5900 & 100-day SMA

FXTM’s US500, which tracks the benchmark S&P 500 index is on track for its worst trading week since September.

But bulls could make a return if the “Santa Claus rally” kicks off in the week ahead:

Saturday, 21st December

  • Deadline for avoiding partial US government shutdown
  • CN50: China’s National People’s Congress standing committee

Monday, 23rd December

  • SG20: Singapore CPI
  • TWN: Taiwan industrial production, jobless rate
  • GBP: UK GDP (final)
  • USDInd: US Conference Board consumer confidence

Tuesday, 24th December

  • AU200: RBA meeting minutes
  • JP225: BoJ meeting minutes

Wednesday, 25th December

  • Stock markets closed – Christmas Day

Thursday, 26th December

  • Boxing Day Holiday
  • SG20: Singapore industrial production
  • US500: US initial jobless claims

Friday, 27th December

  • JP225: Japan Tokyo CPI, unemployment, industrial production, retail sales

The lowdown…

US equities tumbled on Wednesday following the Fed’s hawkish pivot.

Interest rates were cut as widely expected but the Fed signalled a slower pace of easing in 2025.

Traders are now only pricing in a 54% probability of a 25 basis point Fed cut by March 2025 with this jumping to 75% by May 2025. 

This sent the US500 tumbling 3%, dragging prices below 5900 for the first time since mid-November.

US5001

US equity bears are back in the scene with the threat of a potential partial US government shutdown weighing on sentiment.

The question is whether the latest developments have reduced the chance of a Santa rally?

What is the Santa rally?

This financial phenomenon is where stocks generally gain in the last week of December and the first two trading days of the new year.

It’s unclear whether this is fueled by psychology or triggered by underlying financial forces.

Nevertheless, history has shown that this is a recurring seasonal pattern.

Indeed, December has been a historically positive month for the S&P500 which has produced positive returns 70% of the time since 1995.

On average, over the past 30 years the S&P 500 has delivered returns of 1% in December.

 

The bigger picture…

The US500 is up 23% year-to-date – its second straight year of returns above 20%.

It has notched 57 record highs thanks to the AI mania, Fed rate cuts and Trump’s election win.

A Santa Clause rally could push prices back toward the psychological 6000 level, paving a path back to 6100 and higher.

 

Technical forces

The sharp selloff last Wednesday has placed bears in a position of power. Prices are trading below the 21 and 50-day SMA but the Relative Strength Index (RSI) is near oversold levels.

  • Sustained weakness below 5900 may encourage a decline toward the 100-day SMA and 5700.
  • A move back above 5900 could trigger an incline toward 21-day SMA and 6100.

US500 23

Forex-Time-LogoArticle by ForexTime

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Economics & Fundamentals Opinions
20 Dec

Brent Oil Under Pressure Again: USD and China in Focus

By RoboForex Analytical Department

Brent crude oil prices fell below 73 USD per barrel on Friday, reflecting ongoing downward pressure. The market is poised to close the week with losses as a robust US dollar weighs heavily on commodity prices.

This week, the US Federal Reserve signalled a measured approach to reducing borrowing costs in 2025, sending the US dollar to a two-year high. The dollar’s strength has raised concerns about a dampened outlook for global fuel demand, particularly in emerging markets where dollar-denominated commodities become more expensive.

Concerns from China add to market anxiety

The ongoing unease about China’s economic recovery adds to the bearish sentiment. Sinopec, the country’s largest refiner, announced that domestic petrol demand likely peaked last year. This revelation has significantly clouded the outlook for 2025 as China’s role as a key driver of global energy consumption diminishes. China’s reduced demand has cast a long shadow over global crude markets, leading to further downward price pressures.

Mixed signals from supply dynamics

Despite the weak demand signals, the supply side has provided mixed indicators. Earlier in the week, data from the US Department of Energy showed reduced oil reserves, temporarily bolstering prices. However, this bullish factor was short-lived. Kazakhstan’s decision to support the extended production cuts under OPEC+ was another potentially supportive signal, but it has failed to provide sustained relief to oil prices amid broader concerns.

The structural expansion of production outside OPEC, particularly in the US and other non-OPEC nations, further complicates the outlook. Combined with China’s declining appetite for energy, these factors suggest that oil prices may end 2024 on a subdued note, with limited prospects for a significant recovery.

Technical analysis of Brent oil

H4 chart analysis: on the H4 timeframe, Brent continues to trade within a broad consolidation range around the 73.13 USD level. The market recently extended this range upwards to 73.40 USD. However, a downward move to 71.93 USD appears imminent. If the market manages to break out of this range to the upside, the next target lies at 75.05 USD, with the potential for further gains towards the 80.00 USD level.

From a technical standpoint, the MACD indicator supports this scenario, with the signal line positioned below the zero level near recent lows. This indicates that the market could soon attempt a reversal towards higher levels, potentially marking the beginning of a new growth wave.

H1 chart analysis: on the H1 chart, Brent is also consolidating around 73.13 USD. The current wave structure suggests a decline towards 71.93 USD, followed by an expected corrective wave to return to 73.13 USD. If this resistance is breached, the market may gain momentum, with an upward trajectory targeting 75.05 USD and potentially higher levels.

 

Disclaimer

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

Energy Financial News Forex and Currency News
19 Dec

The US Federal Reserve cut rates by 0.25% but signaled a more hawkish approach next year.

By JustMarkets

At Wednesday’s close, the Dow Jones Index (US30) was down 2.58%. The S&P 500 Index (US500) fell by 2.95%. The Nasdaq Technology Index (US100) lost 3.60%. The US stocks fell on Wednesday as the Federal Reserve cut interest rates by 25 bps but signaled fewer cuts than previous estimates for next year, triggering a market sell-off. A widely expected Fed rate cut to the target range of 4.25%–4.5% was overshadowed by an estimate that the rate would be cut by just two points in 2025, down from the four previously expected, dampening investor sentiment. As the Central Bank lowered its unemployment prognosis and raised expectations for core inflation and economic growth, Treasury yields rose sharply, putting additional pressure on stock prices. The odds of pausing rate cuts in January rose to 88%, up from 80% before the FOMC decision. The US dollar strengthened, with the biggest gains against the Australian dollar, euro, British pound, and yen.

Equity markets in Europe were mostly up on Wednesday. The German DAX (DE40) was down 0.02%, the French CAC 40 (FR40) closed up 0.26%, the Spanish IBEX 35 (ES35) added 0.26%, and the British FTSE 100 (UK100) closed up 0.05%. The Eurozone’s annualized inflation rate for November 2024 rose to 2.2% from 2% in October but below the 2.3% preliminary estimate. The increase towards the end of the year was expected mainly due to base effects, as last year’s sharp decline in energy prices is no longer factored into the annualized rate. Annual core inflation was confirmed at 2.7%, which aligns with the forward data. The UK’s annual core inflation rate rose to 3.5% in November 2024, up from 3.3% in the previous month, the highest since August. However, the figure was slightly below market estimates of 3.6%. The annualized services CPI remained unchanged at 5.0%.

In the oil market, data from the EIA showed that US crude oil inventories fell by nearly 1 million barrels in the second week of December, extending a 1.4 million barrel decline from the previous week. In addition, according to the same report, the US oil exports rose to 1.8 million barrels, the highest since July. In turn, other reports indicated that Kazakhstan intends to honor the lengthy oil production cuts mandated by OPEC+ for next year, abandoning previous signals that it would increase output to an initial level of 190,000 barrels per day. This added to the signal that other members of the organization, notably the UAE, were sticking to extending the production cuts.

Asian markets traded flat yesterday. Japan’s Nikkei 225 (JP225) lost 0.72%, China’s FTSE China A50 (CHA50) added 1.06%, Hong Kong’s Hang Seng (HK50) increased by 0.83%, and Australia’s ASX 200 (AU200) was negative 0.06%.

New Zealand’s economy contracted by 1% in September 2024, which was worse than the 0.4% contraction expected by the market. This is the second consecutive quarter of contraction and the sharpest contraction since September 2021. On an annualized basis, GDP fell by 1.5% after 0.5% contraction in the second quarter. The New Zealand dollar hit a two-year low on the back of this data, as well as a rise in the Dollar Index.

The Australian dollar fell to its lowest level in more than two years, after a hawkish rate cut by the US Federal Reserve, which strengthened the dollar. Further pressure came from weak economic data from China and the risk of renewed US tariffs under a possible Trump administration, given Australia’s close trade ties with China. Domestically, concerns over slowing economic activity persist, with Australian Consumer Confidence declining and markets raising expectations for the Reserve Bank of Australia’s (RBA) first rate cut amid growing signs of economic weakness.

Bank Indonesia kept its benchmark interest rate at 6% at its December 2024 meeting, in line with market expectations. The decision reflects the Central Bank’s desire to keep inflation under control within the target range of 2.5%, plus-minus 1%, for 2024 and 2025, as well as stabilize the rupiah exchange rate amid heightened global uncertainty. Indonesia’s annual inflation rate fell to 1.55% in November 2024 from 1.71% in the previous month, the lowest since July 2021, and remained within the target range.

The Bank of Thailand kept its key interest rate unchanged at 2.25% at its final meeting in 2024 after an unexpected 25 bps cut in October, as expected. The decision was made against the backdrop of accelerating inflation and GDP growth and maintaining long-term macro-financial stability. Inflation remained below the Central Bank’s target for most of this year, but rose to a six-month high of 0.95% in November, nearing the lower end of the 1–3% target range.

S&P 500 (US500) 5,872.16 −178.45 (−2.95%)

Dow Jones (US30) 42,326.87 −1,123.03 (−2.58%)

DAX (DE40) 20,242.57 −3.80 (−0.02%)

FTSE 100 (UK100) 8,199.11 +3.91 (+0.05%)

USD Index 108.25 +1.30 (+1.21%)

News feed for: 2024.12.19

  • Japan BoJ Interest Rate Decision at 05:00 (GMT+2);
  • Japan BoJ Monetary Policy Statement at 05:00 (GMT+2);
  • Japan BoJ Press Conference at 06:30 (GMT+2);
  • German GfK Consumer Confidence (m/m) at 09:00 (GMT+2);
  • Sweden Riksbank Rate Decision (m/m) at 10:30 (GMT+2);
  • Norway Norges Bank Rate Decision (m/m) at 11:00 (GMT+2);
  • UK BoE Interest Rate Decision at 14:00 (GMT+2);
  • UK BoE  Monetary Policy Statement at 14:00 (GMT+2);
  • US GDP (q/q) at 15:30 (GMT+2);
  • US Initial Jobless Claims (w/w) at 15:30 (GMT+2);
  • US Existing Home Sales (m/m) at 17:00 (GMT+2);
  • US Natural Gas Storage (w/w) at 17:30 (GMT+2);
  • Mexico Banxico Interest Rate Decision at 21:00 (GMT+2);
  • New Zealand Trade Balance (m/m) at 23:45 (GMT+2).

By JustMarkets

 

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

Economics & Fundamentals Opinions
19 Dec

Market round-up: BoE & BoJ hold, Fed delivers ‘hawkish’ cut

By ForexTime

  • BoE keeps ‘gradual’ cut prospects alive
  • Dovish BoJ sends Yen into intervention zone
  • Fed signals slower pace of cuts in 2025

Sterling slipped on Thursday after the Bank of England kept rates unchanged.

Prices dipped toward 1.2600 as investors reacted to three officials voting for an immediate reduction.

The Bank of England voted 6-3 to cut interest rates by a quarter point to 4.75% today.

Overall, the central bank adopted a dovish tone – signaling gradual easing in 2025. However, it flagged geopolitical and trade risks with Trump’s return to the White House.

Still, traders are now pricing in a 73% probability of a 25-basis point cut by February 2025.

Looking at the charts, the GBPUSD remains bearish with 1.2500 the next level of interest.

gpusd

 

Fed’s ‘hawkish’ cut slams markets

Equities tumbled, the dollar surged, and gold tanked despite the Fed cutting rates by 25 basis points on Wednesday.

Investors were more concerned about the hawkish messaging which signalled a slower pace of Fed cuts in 2025.

Fed Chair Jerome Powell stated that the 2024 inflation forecast had “kind of fallen apart” with officials now seeing inflation at 2.5% at the end of 2025.

 

What does this mean?

The updated dot plot implies another 50 bps of rate cuts in 2025 compared to the 100 bps in the September dot plot.

So essentially, the Fed sees only two rate cuts in 2025.

And markets reactive aggressively to the Fed’s new projected path:

  • US500 fell as much as 3.5%
  • Gold tumbled over 2%
  • USInd surged over 1% to a fresh 2-yr high.

Traders are now expecting only a 50% chance of a 25bp Fed cut by March 2025 with this jumping to 94% by June 2025.

Expectations around slower Fed rate cuts are likely to set the tone for markets for the rest of 2024.

 

Yen rallies on dovish BoJ

The USDJPY has jumped roughly 400 pips this week thanks to a hawkish Fed and dovish BoJ.

BoJ rates were left unchanged as expected but Ueda’s dovish commentary surprised markets.

He stated that more information on Japan wages and Trump’s policies was needed before the BoJ could decide on a rate hike path.

This dented expectations around the BoJ hiking interest rates next month. Traders are now seeing a less than 50% probability of a January 2025 hike.

The Yen weakened further on this development, already battered by a hawkish Fed in the previous session.

Looking at the charts, the technical bullish levels discussed in our week ahead report were hit with prices back within intervention zones.

usdjpyf

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Economics & Fundamentals Financial News
19 Dec

NZD/USD at a New Low: The Problem is the US Dollar and Local GDP

By RoboForex Analytical Department

NZD/USD has dropped to its lowest level since October 2022, trading around 0.5620. The currency pair is under pressure from two major factors: the strengthening US dollar and New Zealand’s weak domestic economic data.

The primary driver of the decline in NZD/USD is the robust performance of the US dollar. Following the Federal Reserve’s December meeting, the greenback gained considerable strength due to expectations of subdued rate cuts in 2025. Throughout Wednesday, the NZD dropped by 2.3% against the US dollar, underscoring the impact of a hawkish Fed outlook.

The second factor contributing to NZD’s weakness is poor domestic economic performance. New Zealand’s GDP data has reinforced concerns that the economy is in recession. In Q3 2024, GDP contracted by 1.0% quarter-on-quarter, following a revised 1.1% decline in Q2. On an annualised basis, the economy shrank by 1.5%, a sharp deterioration from the 0.5% contraction recorded in the previous quarter.

The GDP figures were worse than anticipated, heightening fears of a deeper recession and increasing the likelihood of further aggressive monetary easing by the Reserve Bank of New Zealand (RBNZ). Even before this latest data, the RBNZ had been more proactive than several other central banks in cutting interest rates, and the recent developments are likely to reinforce its dovish stance for 2025.

Technical analysis of NZD/USD

On the H4 chart, NZD/USD experienced a downward pullback from the 0.5785 level and broke through the 0.5690 support level. The current market structure indicates the formation of a downward wave targeting 0.5598. After reaching this level, a corrective move back to test 0.5690 from below is possible. Notably, the breakdown below 0.5690 has paved the way for further declines towards 0.5500, with the main target projected at 0.5454. This bearish scenario is supported by the MACD indicator, with its signal line positioned below the zero mark and trending sharply downward.

On the H1 chart, NZD/USD is shaping a downward wave towards 0.5597. Before the decline resumes, a short-term correction to 0.5690 could occur. The next target would be 0.5500. This outlook is confirmed by the Stochastic oscillator, where the signal line is near the 80 mark and preparing to drop towards the 20 mark, indicating continued bearish momentum.

 

Disclaimer

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

Financial News Forex and Currency News
19 Dec

When AI goes shopping: AI agents promise to lighten your purchasing load − if they can earn your trust

By Tamilla Triantoro, Quinnipiac University 

Online shopping often involves endless options and fleeting discounts. A single search for running shoes can yield hundreds of results across multiple platforms, each promising the “best deal.” The holiday season brings excitement, but it also brings a blend of decision fatigue and logistical nightmares.

What if there were a tool capable of hunting for the best prices, navigating endless sales and making sure your purchases arrive on time?

The next evolution in artificial intelligence is AI agents that are capable of autonomous reasoning and multistep problem-solving. AI shopping agents not only suggest what you might like, but they can also act on your behalf. Major retailers and AI companies are developing AI shopping assistants, and the AI company Perplexity released Buy with Pro on Nov. 18, 2024.

Picture this: You prompt AI to find a winter coat under $200 that’s highly rated and will arrive by Sunday. In seconds, it scans websites, compares prices, checks reviews, confirms availability and places the order, all while you go about your day.

image of a webpage showing two small photos of women's coats
Perpelexity’s recently released AI shopping agent can search for items across the web using multiple free-form variables sucgh as color, size, price and shipping time.
Screenshot by Tamilla Triantoro

Unlike traditional recommendation engines, AI agents learn your preferences and handle tasks autonomously. The agents are built with machine learning and natural language processing. They learn from their interactions with the people using them and become smarter and more efficient over time from their collective interactions.

Looking ahead, AI agents are likely to not only master personal shopping needs but also negotiate directly with corporate AI systems. They will not only learn your preferences but will likely be able to book tailored experiences, handle payments across platforms and coordinate schedules.

As a researcher who studies human-AI collaboration, I see how AI agents could make the future of shopping virtually effortless and more personalized than ever.

How AI agents help shoppers

Marketplaces such as Amazon and Walmart have been using AI to automate shopping. Google Lens offers a visual search tool for finding products.

Perplexity’s Buy with Pro is a more powerful AI shopping agent. By providing your shipping and billing information, you can place orders directly on the Perplexity app with free shipping on every order. The shopping assistant is part of the company’s Perplexity Pro service, which has free and paid tiers.

For those looking to build custom AI shopping agents, AutoGPT and AgentGPT are open-source tools for configuring and deploying AI agents.

Consumers today are focused on value, looking for deals and comparing prices across platforms. Having an assistant perform these tasks could be a tremendous time saver. But can AI truly learn your preferences?

A recent study using the GPT-4o model achieved 85% accuracy in imitating the thoughts and behaviors of over 1,000 people after they interacted with the AI for just two hours. This breakthrough finding suggests that digital personas can understand and act on people’s preferences in ways that will transform the shopping experience.

How AI shopping reshapes business

AI agents are moving beyond recommendations to autonomously executing complex tasks such as automating refunds, managing inventory and approving pricing decisions. This evolution has already begun to reshape how businesses operate and how consumers interact with them.

Retailers using AI agents are seeing measurable benefits. Since October 2024, data from the Salesforce shopping index reveals that digital retailers using generative AI achieved a 7% increase in average order revenue and attributed 17% of global orders to AI-driven personalized recommendations, targeted promotions and improved customer service.

Meanwhile, the nature of search and advertising is undergoing a major shift. Amazon is capturing billions of dollars in ad revenue as shoppers bypass Google to search directly on its platform. Simultaneously, AI-powered search tools such as Perplexity and OpenAI’s web-enabled chat deliver instant, context-aware responses, challenging traditional search engines and forcing advertisers to rethink their strategies.

The outcome of the battle between Big Tech and open-source initiatives to shape the AI ecosystem is also likely to affect how the shopping experience changes.

image of a webpage showing two small photos of insulated travel mugs
Shoppers can have back-and-forth interactions with AI agents.
Screenshot by Tamilla Triantoro

The risks: Privacy, manipulation and dependency

While AI agents offer significant benefits, they also raise critical privacy concerns. AI systems require extensive access to personal data, shopping history and financial information. This level of access increases the risk of misuse and unauthorized sharing.

Manipulation is another issue. AI can be highly persuasive and may be optimized to serve corporate interests over consumer welfare. Such technology can prioritize upselling or nudging shoppers toward higher-margin products under the guise of personalization.

There’s also the risk of dependency. Automating many aspects of shopping could diminish the satisfaction of making choices. Research in human-AI interaction indicates that while AI tools can reduce cognitive load, increased reliance on AI could impair people’s ability to critically evaluate their options.

What’s next?

AI-based shopping is still in its infancy, so how much trust should you place in it?

In our book “Converging Minds,” AI researcher Aleksandra Przegalinska and I argue for a balanced and critical approach to AI adoption, recognizing both its potential and its pitfalls.

As cognitive scientist Gary Marcus points out, AI’s moral limitations stem from technical constraints: Despite efforts to prevent errors, these systems remain imperfect.

This cautious perspective is reflected in the responses from my MBA class. When I asked students whether they were ready to outsource their holiday shopping to AI, the answer was an overwhelming no. Ethan Mollick, a professor at the Wharton School at the University of Pennsylvania, has argued that the adoption of AI in everyday life will be gradual, as societal change typically lags behind technological advancement.

Before people are willing to hand over their credit cards and let AI take the reins, businesses will have to ensure that AI systems align with human values and priorities. The promise of AI is vast, but to fulfill that promise I believe that AI will need to be an extension of human intention – not a replacement for it.The Conversation

About the Author:

Tamilla Triantoro, Associate Professor of Business Analytics and Information Systems, Quinnipiac University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

 

Opinions Programming
18 Dec

What’s next for Albertsons after calling off its $25B grocery merger with Kroger: More lawsuits

By Christine P. Bartholomew, University at Buffalo 

Albertsons announced on Dec. 11, 2024, that it had called off an attempted merger with Kroger and would sue Kroger for breach of contract. The US$25 billion deal, first announced in 2022, would have combined Cincinnati-based Kroger, already the largest traditional U.S. supermarket chain, with Boise, Idaho-based Albertsons, which is currently the third-biggest grocer.

The Conversation U.S. asked Christine P. Bartholomew, a professor at the University at Buffalo School of Law who researches consumer protection, to explain how the merger failed and why it matters.

Which supermarkets belong to the two companies?

Kroger has 28 subsidiaries with nearly 2,800 supermarkets, including Harris Teeter, Dillon’s, Smith’s, King Soopers, Fry’s, City Market, Owen’s, JayC, Pay Less, Baker’s Gerbes, Pick‘n Save, Metro Market, Mariano’s Fresh Market, QFC, Ralphs and Fred Meyer.

Albertsons owns and operates more than 2,200 supermarkets through its many brands. They include Safeway, Vons, Jewel-Osco, Shaw’s, Acme, Tom Thumb, Randalls, United Supermarkets, Pavilions, Star Market, Haggen, Carrs, Kings Food Market and Balducci’s.

Kroger and Albertsons also operate supermarkets branded with their own names.

Had the merger gone forward, it would have been the largest of its kind in U.S. history, affecting millions of grocery shoppers.

To ward off regulators’ concerns, prior to canceling the transaction, the chains announced in 2023 a plan to sell hundreds of their supermarkets across the United States to C&S Wholesale Grocers. They updated this plan in 2024, pledging to not close any stores.

Why did Kroger want to acquire Albertsons?

The companies argued that they needed to join forces to compete against even bigger online and big box retailers. In recent years, Walmart and Costco have gained market share, while other chains have held steady or lost ground.

The companies also feared stiff competition from dollar stores, one of the fastest-growing segments of U.S. retail.

The federal government opposed the merger, with the U.S. Federal Trade Commission suing to block it. Had the deal gone through, the new company would have cemented its position, ensuring it has the largest market share for grocery purchases after Walmart.

What happened in court?

In February 2024, the FTC, along with state attorneys general representing consumers in eight states – Arizona, California, Illinois, Maryland, Nevada, New Mexico, Oregon and Wyoming – filed a federal lawsuit in Oregon to block the merger. So did the District of Columbia’s attorney general.

This wasn’t the only legal challenge the merger faced. The Washington and Colorado attorneys general both filed suit in their own states to block the merger.

After hearings in both cases and months of uncertainty, the judges in both Oregon and Washington issued their rulings.

U.S. District Court Judge Adrienne Nelson, in Portland, Oregon, on Dec. 10, which blocked the merger pending the outcome of the administrative proceedings before the FTC.

A few hours later, Judge Marshall Ferguson in Seattle issued a permanent injunction barring the merger in Washington state only. Both judges determined that the merger risked significantly reducing competition and that the companies didn’t offer enough evidence that the merger would help consumers.

“We’re standing up to mega-monopolies to keep prices down,” Ferguson said. He called the injunction “an important victory for affordability, worker protections and the rule of law.”

Albertsons and Kroger’s plan to offload stores to C&S didn’t impress the judges. Not only did Nelson find the divestiture insufficient in scale, but she ruled it was “structured in a way that will significantly disadvantage C&S as a competitor.”

Albertsons v. Kroger

The morning after the Washington and Oregon decisions were issued, the deal was dead.

Albertsons announced it terminated the merger agreement, citing the court decisions.

Both companies still face significant legal challenges, though. Five minutes after announcing its intent to back out of the deal, Albertsons issued a second press release announcing it had filed a lawsuit against Kroger.

Albertsons said Kroger willfully breached the deal “by repeatedly refusing to divest assets necessary for antitrust approval, ignoring regulators’ feedback, rejecting stronger divestiture buyers and failing to cooperate with Albertsons.” The suit seeks significant damages, including “billions of dollars” for lost shareholder value and legal costs, as well as a $600 million merger breakup fee.

In response, Kroger said that “Albertsons’ claims are baseless and without merit.”

Albertsons’ suit against Kroger is pending in Delaware Court of Chancery, which hears many legal business disputes. The complaint remains temporarily under seal.

This article includes passages that appeared in an article about the proposed merger that was published on Feb. 28, 2024.The Conversation

About the Author:

Christine P. Bartholomew, Professor of Law, University at Buffalo

This article is republished from The Conversation under a Creative Commons license. Read the original article.

 

Opinions Stock Market News
18 Dec

Sweden is a nearly cashless society – here’s how it affects people who are left out

By Moa Petersén, Lund University and Lena Halldenius, Lund University 

Around the world, cards and apps are the default way to pay – but nowhere is the transition away from cash more obvious than in Sweden. The Bank of Sweden notes that the amount of cash in circulation in the country has halved since 2007.

Part of this is due to a unique Swedish law that prioritises “freedom of contract” above any legal requirement to accept cash. In other words, it is up to businesses – including banks – whether they take cash. Public transport, stores and services typically do not accept cash as payment, and there is no infrastructure for paying bills over the counter.

The transition to cashlessness accelerated when a group of banks created the mobile payment app Swish in 2012. By 2017, Sweden was using less cash than other European countries. Today, more than 80% of the population has a Swish account.

For most Swedes, the cashless economy is swift and convenient. As long as you have a bank account and can access the technology, you probably live a cashless life already. But for the few people who still depend on cash, life is getting harder.

Our recent research how this affects the worst-off groups in Sweden’s cashless society. Our interviewees live in poverty-induced cash dependence, meaning they rely on cash payments because they are unbanked, lack credit or cannot afford digital technology.

While it is difficult to measure just how many people depend on cash, older people, particularly, are struggling to pay bills digitally.

Some of those we interviewed are homeless or have mental health issues. Others live on a very low income. The obstacles they face are both practical and cultural. They feel like delinquents, undervalued and locked out of participating in much of daily life.

Being cash-dependent in Sweden

If cash is the only money you have or the only money you can manage without help, you are confined to “cash bubbles”. Cash works like a local currency, isolated from the rest of the economy.

In the cash bubble, you can buy necessities and go to no-frills cafes, but you can’t pay for parking and you can’t pay bills without help. Volunteers at local community groups told us that they spend most of their time doing people’s banking for them.

A Ukrainian refugee, who can’t get a bank account because of their migration status, worried about a bill from the local health clinic that they had no technical means of paying.

Homeless people who sleep in cars can’t use the cashless parking meters, so an illicit market has emerged where people with smartphones and bank accounts pay for their parking at a substantial extra cost. It’s expensive to be digitally poor.

Our interviewees felt left behind in a society that does not care about their ability to participate. With a mix of shame, anger and resignation, they described everyday humiliations. One woman saved up to buy her grandchild a gift she wanted, only to be told at the till – grandchild in hand – that they didn’t accept her money. “I felt like a thief,” she told us.

Sweden’s cashless transition

Swedes are known to be early and uncritical adopters of technology – this has become part of the country’s self-image. In 2017, business researchers predicted that cash would be irrelevant in Sweden by March 2023. It didn’t quite happen, but near enough.

Over the last 150 years, technological innovations and entrepreneurship have propelled the country from severe poverty to being one of the richest in Europe.

The Swedish case is even more special due to the pervasive role of banks in the payment and identification infrastructure. Banks created the widely used payment app Swish, and also issue the electronic ID needed to access public services like the tax authority and benefits for illness, disability and unemployment.

Consequently, if you are not a bank customer, you can’t access these public services.

During the pandemic, fears of contamination made handling physical money seem like a health hazard. “I hate cash. It’s dirty,” as one Swedish tech entrepreneur put it.

All of these factors combined have led to a modern Swedish society where digital money is good and cash is associated with crime and dirt. For people who still depend on cash payments, this stigma adds to their sense of being left out.

In Sweden, as in many other countries, a fully cashless economy feels inevitable in the coming years. But as we have found, people who rely on cash due to poverty are left without the means to manage independently or even to pay their bills.

This is not just a practical issue, but an emotional one. There is a sense of loneliness, of loss of community and human connection in the digital economy. As one of our interviewees said: “It’s not just cashlessness. I feel that human beings have disappeared. We live like robots; click here, click that. Digitisation has made people lonely.”The Conversation

About the Author:

Moa Petersén, Associate Professor in Digital Cultures, Lund University and Lena Halldenius, Professor of Human Rights Studies, Lund University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

 

Economics & Fundamentals Opinions
18 Dec

The Dow Jones has fallen for 9 consecutive trading sessions. Inflationary pressures are easing in Canada.

By JustMarkets

As of Tuesday’s close, the Dow Jones Index (US30) was down -0.61%, extending its losing streak to nine sessions. The S&P500 index (US500) was down -0.39%. The Nasdaq Technology Index (US100) lost -0.43%. The US stocks declined on Tuesday as markets refrained from opening risky positions ahead of tomorrow’s Federal Reserve decision. After Wednesday’s meeting, the FOMC is expected to cut the target range for the federal funds rate by -25 bps. Markets will also be looking to Fed Chair Powell’s comments after Wednesday’s meeting for clues on the future direction of Fed policy. Jerome Powell’s recent comments noted reduced risks in the labor market, but persistent inflation has led to speculation of a rate cut, with a hawkish stance for the next meeting in 2025. If this scenario were to occur, it would boost the dollar index, which would negatively impact risk assets (euro, British pound, Mexican peso) and pressure precious metals (gold and silver).

The US retail sales report for November published on Tuesday came in stronger than expected, showing a resilient economy with strong consumer spending. However, it could prompt the Federal Reserve to cut interest rates next year when it updates its quarterly dot-com forecasts on Wednesday. The US retail sales for November rose by +0.7% m/m, stronger than expectations of +0.6% m/m. Retail sales excluding motor vehicles for November rose by +0.2% m/m, weaker than expectations of +0.4% m/m. US manufacturing production for November added +0.2% m/m, weaker than expectations of +0.5% m/m.

On Tuesday, shares of healthcare companies that own pharmacy benefit management units declined after Pfizer’s CEO said President-elect Trump is “very committed” to reforming pharmacy benefit management (PBM). As a result, Humana (HUM) closed down more than -10%, topping the list of S&P 500 losers. Meanwhile, Pfizer (PFE) stock price gained more than +4% and topped the list of top gainers in the S&P 500 after reaffirming its 2024 outlook and 2025 adjusted EPS guidance of $2.80-$3.00, above the average consensus estimate of $2.89.

Canada’s annual inflation rate for November 2024 was 1.9%, down from 2% in the previous month and short of market expectations of 2%. The result was in line with the Bank of Canada’s baseline scenario, which sees CPI inflation remaining near the 2% threshold for the foreseeable future. However, the average prime rate remained unchanged at 2.7% instead of expectations of a cut to 2.5%, limiting the extent of rate cuts that can be undertaken by the monetary authorities to promote economic growth.

Equity markets in Europe were mostly down on Tuesday. Germany’s DAX (DE40) fell by -0.33%, France’s CAC 40 (FR 40) closed up +0.12%, Spain’s IBEX 35 (ES35) lost -1.62%, and the UK’s FTSE 100 (UK100) closed down -0.81% yesterday. European equities continued to decline amid new pessimistic economic signals ahead of monetary policy decisions by major central banks this week. In terms of data, the Ifo business climate index for Germany fell more than expected, while the ZEW economic sentiment index unexpectedly rose. Swaps put the odds of a -25bp ECB rate cut at the January 30 meeting at 100% and the odds of a 50bp rate cut at the same meeting at 10%.

WTI crude oil held above $69 a barrel on Wednesday. API data showed that US crude inventories fell by 4.7 million barrels last week, beating forecasts for a 1.9 million barrel decline, which would mark the fourth consecutive decline if confirmed by official data later on Wednesday. Oil prices remain under pressure due to renewed concerns over Chinese demand, driven by unexpectedly weak Chinese consumer spending data. These concerns are compounded by forecasts of a significant rise in non-OPEC+ production next year.

Asian markets traded flat yesterday. Japan’s Nikkei 225 (JP225) fell by -0.24%, China’s FTSE China A50 (CHA50) added +0.67%, Hong Kong’s Hang Seng (HK50) lost -0.48%, and Australia’s ASX 200 (AU200) was positive +0.78% yesterday.

The Westpac-Melbourne Institute of Australia’s leading economic index for November 2024 rose by +0.1% month-on-month after rising +0.2% in the previous month. This was the index’s first positive reading in 2.5 years amid optimism that economic growth will pick up slowly over the next few quarters. Australia’s GDP is forecast to grow from 0.8% y/y currently to 2.2% by the end of 2025.

S&P 500 (US500) 6,050.61 −23.47 (−0.39%)

Dow Jones (US30) 43,449.90 −267.58 (−0.61%)

DAX (DE40) 20,246.37 −67.44 (−0.33%)

FTSE 100 (UK100) 8,195.20 −66.85 (−0.81%)

USD index 106.98 +0.12 (+0.11%)

News feed for: 2024.12.18

  • Australia Westpac Consumer Confidence Index (m/m) at 01:30 (GMT+2);
  • Japan Trade Balance (m/m) at 01:50 (GMT+2);
  • Thailand BoT Interest Rate Decision at 09:00 (GMT+2);
  • UK Consumer Price Index (m/m) at 09:00 (GMT+2);
  • UK Producer Price Index (m/m) at 09:00 (GMT+2);
  • Indonesian BI Interest Rate Decision at 09:30 (GMT+2);
  • Eurozone Consumer Price Index (m/m) at 12:00 (GMT+2);
  • US Building Permits (m/m) at 15:30 (GMT+2);
  • US Crude Oil Reserves (w/w) at 17:30 (GMT+2);
  • US Fed Interest Rate Decision at 21:00 (GMT+2);
  • US FOMC Statement at 21:00 (GMT+2);
  • US FOMC Press Conference at 21:30 (GMT+2);
  • New Zealand GDP (q/q) at 23:45 (GMT+2).

By JustMarkets

 

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

Economics & Fundamentals Financial News
18 Dec

Gold Holds Steady as Investors Await Federal Reserve’s Rate Decision

By RoboForex Analytical Department

Gold prices are hovering around 2,650 USD per troy ounce as investors remain cautious, conserving their energy for a potential move depending on the US Federal Reserve’s rate decision later tonight. The predominant market expectation is a 25-basis-point cut in interest rates, but there’s significant uncertainty about the Fed’s monetary policy trajectory for 2025, which will be a key focus in today’s announcements.

Recent robust retail sales data from November, showing a 0.7% increase, have stirred discussions among investors that the Fed might decelerate its pace of rate cuts. This surge in retail sales is seen as a pro-inflationary factor, potentially influencing the Fed’s approach towards monetary easing.

A slowdown in rate reductions would likely be unfavourable for Gold, as lower interest rates generally decrease the opportunity cost of holding non-yielding assets like Gold, making it more attractive. Nonetheless, investors should wait for the Federal Reserve’s statement, which could diverge from current market speculations.

Since the start of the year, Gold has appreciated over 28%, potentially ending 2024 with the highest annual gain since 2010.

Technical analysis of XAU/USD

H4 Chart: Gold has established a consolidation range around the 2,675.55 level on the H4 chart. A growth structure has been formed up to 2726.27, and a corrective movement towards 2,635.00 is unfolding. Looking forward, a continuation of the growth wave towards 2743.85 is anticipated. The MACD indicator supports the bullish outlook, with its signal line below zero but pointed sharply upwards.

H1 Chart: On the H1 chart, Gold has completed a correction to 2,633.00 and is now expected to rise towards 2,680.00. After this increase, a potential decline to 2,658.00 may occur. Once this level is reached, a new growth phase towards 2705.70 will likely extend to 2,743.85. This scenario is corroborated by the Stochastic oscillator, whose signal line is currently above 50 and aiming towards 80, indicating upward momentum.

 

Disclaimer

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

Financial News Metals
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