Shanghai/Hong Kong, Dec. 6 (Reuters) – Moody’s negative outlook on China has intensified Beijing’s battle with market bears, raising pressure on the government for stronger measures to stem sinking stocks and stabilize the yuan as investor confidence deteriorates.

In its Tuesday announcement, the ratings agency flagged weak growth prospects, amid growing global concerns that China’s economic miracle is over, leaving the world’s second-largest economy in the middle-income trap.

While keeping China’s sovereign rating at A1, Moody’s cut its outlook from stable to negative, citing rising municipal debt and property market woes. Such concerns have prompted other companies to draw comparisons with similar macroeconomic indicators before Japan’s “lost decades” of stagnation.

While China’s rising debt levels and overconfidence in assets have long been part of the conversation, the voice of a rating agency carried enough weight to renew a sell-off in Chinese assets and accelerate state bank activity in markets.

“It’s a financial war,” said Yuan Yue, founder and CIO of Water Wisdom Asset Management.

Moody’s move “will trigger an overseas reduction in Chinese assets and raise China’s financing costs, leading to a decline in asset quality.”

Authorities have taken economic support measures and targeted measures to prop up the stock market, including cutting stamp duty, slowing listings and getting state-backed funds to buy stocks.

In an apparent attempt to calm the market, the official Shanghai Securities News reported on Wednesday that China’s securities watchdog will promote reforms to attract more long-term capital to the market.

Last week, state-owned China Reform Holdings Corp said it had started buying index funds to support the market, following a similar move by sovereign fund Central Huijin Investment.

But on the trade side, the weak prospects for the Chinese economy will be hard to shake as confidence is low.

“If the cost of insuring sovereign debt continues to rise and bailouts begin, pressures on Chinese stocks and the economy in general could increase,” said Ryan Yong, economist at the American Institute for Economic Research.

Rob Cornell, head of Asia-Pacific research at ING, said China had already used several tools to boost demand, but with little effect, “and it will be very difficult to regain public confidence in this market.”

Ultimately, analysts warn, sentiment will stabilize only if China provides a credible long-term roadmap to address the structural weaknesses limiting its growth potential.

“Consolidating growth momentum and increasing confidence for the future is China’s priority,” said Calvin Zhang, senior portfolio manager at Federated Hermes.

China needs to increase fiscal spending and address the hidden debt of local governments, Zhang said.

In October, China unveiled plans to issue 1 trillion yuan ($139 billion) in sovereign bonds by the end of the year, raising the 2023 budget deficit target to 3.8% of gross domestic product (GDP) from the original 3%.

Yuan concerns

China’s blue-chip index (.CSI300) hit its lowest level in nearly five years on Wednesday.

Major state-owned banks also sold the US dollar heavily on Tuesday and Wednesday. China’s central bank has used a variety of tools to stem the yuan’s slide in recent months, including a strong peg before the market opens.

However, the discharge pressure is high.

China posted its first quarterly deficit in July-September, while outflows from China hit $75 billion in September, the biggest monthly outflow since 2016, Goldman Sachs data showed.

Analysts said Moody’s outlook cut could lift stocks further.

“This is already a blow to low investor confidence in China,” said Qi Wang, chief investment officer of UOB Kay Hian’s wealth management division in Hong Kong.

Sovereign debt is the bedrock of Chinese assets, so the move “will certainly affect the yuan exchange rate, and reduce the risk appetite of global investors.”

But not everyone is rough.

Rival rating agencies Fitch Ratings and S&P Global Ratings left their respective China credit ratings unchanged. Fitch affirmed China’s A+ rating with a stable outlook in August, while S&P Global on Wednesday maintained China’s A+ rating with a ‘stable’ outlook.

Some market participants indicated that similar valuation moves in the US had limited long-term market impact.

“Just as most people have held off on a US downgrade, most investors will likely skip a China downgrade,” said Jason Hsu, chief investment officer at Rayliant Global Advisors.

Our Standards: Thomson Reuters Trust Principles.

Dow Jones futures rose overnight, along with S&P 500 futures and Nasdaq futures. MongoDB (MTP) and Dole Brothers (TOL) headline earnings after the close, with the AMD AI event on Wednesday.

X

Stock market gains had a mixed session as Treasury yields continued to slide on weak jobs data. Megacaps outperformed while small caps lagged. Apple (APL) exploded, returning over $3 trillion in value. Amazon.com (AMZN) recovered a buy point. Nvidia (NVDA) and Tesla (D.S.L.A) rebounded from their 50-day lines. Microsoft (MSFT) slightly higher into the buy zone.

MongoDB (MTP), asana (Teacher), Health Equity (remove), Dole Brothers (TOL), SentinelOne (S) and Aeroenvironment (opens) reported Tuesday night.

Wednesday morning, Ollie’s Bargain Outlet (Ollie) will publish quarterly financials.

Advanced Micro Devices (AMD) will host its Advancing AI event on Wednesday morning. It is expected to formally introduce its MI300 data center GPU to widen the competition with Nvidia. AMD shares fell 0.2% to 118.38 on Tuesday, below a 21-day line. While the 122.11 cup-with-handle buy point is technically valid, investors should use the Nov. 29 high of 129.73 as a new handle entry.

Amazon shares, Microsoft and Nvidia run IBD Leaderboard. Apple stock and Nvidia were added to swing traders on Tuesday. MSFT stock is on the IBD Long-Term Leaders list. Nvidia shares, SentinelOne, MongoDB and Microsoft IBD 50. Microsoft and MDB have shares IBD Big Cap 20.

Apple was Tuesday’s IBD Stock of the Day.

A video embedded in the article reviews Tuesday’s market action and analyzes Apple stock, Amazon and Nvidia.

Dow Jones Futures Today

Dow Jones futures 0.1% vs. fair value. S&P 500 futures rose 0.2% and Nasdaq 100 futures rose 0.3%.

Remember that overnight action in Dow futures and elsewhere does not necessarily translate into actual trading in the next regular stock market session.

Main revenue

MDB stock fell sharply in overnight trade, indicating a move below a recent buy point. MongoDB revenue once again crushed views, while revenue remained comfortably at the top. The database software maker also guided Q4 higher. But billing and deferred revenue were disappointing. MongoDB shares rose 2.5% to 433.67 on Tuesday, according to MarketSmith analysis. The official purchase point is 412.67.

ASAN shares fell in extended activity, with ASAN also topping views and signaling a move back below the buy zone, albeit a higher guide. Shares rose 2.2% to 23.31 on Tuesday. Asana stock cleared the 22.13 handle buy point last Friday.

HQY stock was little changed overnight after health equity earnings topped Q3 views. Shares of the health savings account manager fell 4 cents to 69.02 on Tuesday, below the 50-day line. The health equity stock is working from a 13-month cup-with-handle base at a buy point of 76.62. A decisive move beyond 50 days can provide early entry.

TOL shares rose modestly in late trade after the luxury homebuilder topped earnings forecasts and delivered solid fiscal Q1 and 2024 guidance. Dole Brothers stock closed at 87.21. This is a slight extension from the 82.39 cup-with-handle buy point, but the 87.12 shelf entry range.

SentinelOne stock rose in extended trading, marking a breakout after the cybersecurity company reported a smaller-than-expected loss and 42% revenue growth. SentinelOne’s 4th Quarter Earnings Rise Shares fell 1.2% to 20 on Tuesday, but are running just to the right of a 43% deep base with a 21.95 buy point. S stock last week entered the opening around 18.

AVAV stock fell in overnight activity after AeroVironment earnings beat solidly. Shares of the drone maker rose 0.8% to 141.23 after hitting a record high on Monday. AVAV stock has extended from a buy zone.

Join IBD experts as they analyze leading stocks and markets on IBD Live

Stock market rally

Stock market gains were mixed as small caps pulled back, while mega caps lifted major indices.

The Dow Jones industrial average fell 0.2% in stock market trading on Tuesday. The S&P 500 index lost a fraction. The Nasdaq composite rose 0.3.

The Dow is at a 52-week high while the S&P 500 and Nasdaq are trading below their 52-week highs.

Although the overall trend is positive, it is not a good day for market breadth. Losers outscored winners on the NYSE and Nasdaq by nearly 2-to-1.

The small-cap Russell 2000 fell 1.4%. That followed Friday’s 2.9% jump and Monday’s 1.1% gain.

Invesco S&P 500 Equal Weight ETF (RSP) fell 0.8%, certainly undercutting the S&P 500.

The First Trust Nasdaq 100 Equal Weighted Index ETF (QQEW) fell 0.6%, but lower. The Nasdaq 100 rose 0.25%, boosted by shares of Apple, Amazon, Nvidia, Tesla and others.

Leading stocks have generally looked good, while losing sectors have mostly taken pauses within upswings. An exception is the oil and gas sector.

US crude oil prices fell 1% to $72.32 a barrel.

The 10-year Treasury yield fell 11.5 basis points to 4.17%, hitting a three-month low. The odds of a March Fed interest rate cut are now more than 65%, down from 35% a week ago.

ETFs

Among growth ETFs, the iShares Expanded Technology-Software Sector ETF (VAT) closed below the break-even point. Microsoft stock is a large IGV holding, and the fund also owns SentinelOne. VanEck Vectors Semiconductor ETF (SMH) was flat. NVDA is the largest SMH holding, with AMD also a significant component.

Reflecting stocks with more speculative stories, the ARK Innovation ETF (ARKK) fell 0.9% to ARK Genomics (ARKG) retreated 3.25%. Tesla stock is a major holding across ARK Invest’s ETF portfolio.

SPDR S&P Metals & Mining ETF (XME) fell 2.5%, and the Global X US Infrastructure Development ETF (sidewalk) gave 1.1x%. US Global Jets (JETS) decreased by 1.55%. SPDR S&P Homebuilders ETF (XHB) fell 0.5%, TOL stock is a member of XHB. Energy Select SPDR ETF (XLE) reduced by 1.75%, and the Health Care Select Sector SPDR Fund (XLVdecreased by 0.1%.

Industrial Select Sector SPDR Fund (XLIretreated 0.8%. Fund Selection SPDR ETF (45Decreased by 0.5%.

Tesla Vs. BYD: Competing for the crown of EV giants, but which is the best buy?

Megacap shares

Megacap shares have paused or retreated over the past two weeks, but rallied on Tuesday.

Apple shares rose 2.1% to 193.42, clearing a 192.93 cup-with-handle buy point. AAPL stock closed at $3.008 trillion, again above the $3 trillion level. On Tuesday, Apple iPhone maker Foxconn raised its Q4 outlook after reporting strong November earnings.

Amazon shares rose 1.4% to 146.88, bouncing off a 21-day line and retrieving a 145.86 buy point.

Tesla shares rose 1.3% to 238.72, rebounding from a 50-day line and snapping a four-day losing streak. Shares retreated from an intraday high of 246.66. The EV company has a double-bottom buy point of 278.98, but investors can use the Nov. 29 high of 252.75 as an initial entry.

On Tuesday, weekly EV registration data showed Tesla’s China sales continued to rise, likely helped by the updated Model 3. The EV giant has recently made some offers in China, but they are relatively modest considering the intense EV price war there. On the other hand, weak German sales may have cooled interest in Tesla stock Tuesday afternoon.

Nvidia stock rose 2.3% to 465.66 on Tuesday, moving above its 50-day line after a three-day slide. The 476.09 double-bottom buy point is still valid, but NVDA stock must first break above its 21-day line. It is possible that Nvidia will create a new integration. Volume was below average after high volume low days in the past two weeks.

Wednesday’s AMD AI event is important for Nvidia, which has so far dominated the AI ​​chip business.

MSFT shares rose 0.9% to 372.52. On Monday, shares fell short of a 366.78 cup-base buy point, but managed to close above that entry and 21-day line. Microsoft stock is 7.4% below its 50-day line, and has not extended further after being 11% above that key level on Nov. 10, when it first broke out.

Time the market with IBD’s ETF Market Strategy

What to do now

The stock market rally still looks healthy. Despite Tuesday, market breadth improved.

Some stocks are flashing buy signals, but investors may want to simply stand by while major indexes and some leading stocks consolidate. If they haven’t already, investors may want to take some profits in extended stocks after big November gains. But that depends on exposure and concentration levels and your personal investment style.

Keep working on watch lists. Be sure to screen well beyond growth stocks as many sectors have advanced.

Read the big picture every day to stay in tune with market direction and leading stocks and sectors.

Follow Ed Carson on X/Twitter @IBD_ECarsonAt threads @edcarson1971 and Bluesky at @edcarson.bsky.social For stock market updates and more.

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CNN
—

At least one person died and more than 10 million people were under flood warnings as a powerful storm surge swept across the Pacific Northwest Tuesday. Attacks the region Already wetted by previous atmospheric rivers with heavy rainfall.

Emergency crews in Portland, Oregon were unable to rescue a man who was swept away by floodwaters on Monday. The man’s body was recovered from Johnson Creek Monday afternoon, a Multnomah County Sheriff’s Office deputy told CNN.

Investigators are still trying to determine how the man ended up in the fast-moving water.

More than 8 inches of rain has already fallen in the region in the past 24 hours and rivers are beginning to rise to flood stage, with many rivers forecast to reach major flood levels in the next 24 hours.

In Washington, The Skagit And Snoqualmie Rivers are of particular concern, with roads, farms and even some residential areas predicted to flood. Water levels of areas Skokomish Rivers in western Washington rose to moderate flood stage Tuesday morning Grace River Heavy flooding in southern Washington.

Floodwaters forced road closures in Washington on Tuesday. At least one driver was rescued after driving their car through a flooded Snohomish County road.

More heavy rain on Tuesday will only worsen parts of Oregon’s Cascade Mountains, southern Washington and northwestern California. According to the Weather Forecast Center, there is a slight risk of heavy rain, or a Category 2 of 4, on Tuesday.

A flood watch extends from coastal Oregon and Washington to northeastern Washington and northern Idaho. While most expire on Wednesday, some last until Thursday.

Washington’s Olympic Mountains could get more than a foot of rain, and stacks could see 5 to 9 inches, the weather service said. Along the coast, residents can expect 3 to 5 inches and 1 to 3 inches in inland lowlands.

Monday and Tuesday Atmospheric River already records impressive total: Olympic National Park in Washington record 8.67 inches in the last 24 hours More rain will come.

Check out this interactive content on CNN.com

The weather service advises flooded residents to stay indoors or seek higher ground if shelter is not available.

Thursday and Friday, storm activity is forecast to decrease across much of the Northwest, but showers and some high-altitude snow are possible.

But the interval of wet weather may be short-lived. Forecast computer models show some early signs of another atmospheric river hitting the region by the end of the week.

Once this week’s atmospheric river comes to an end on Wednesday, the exact strength and overall impact of this potential event will become clear.

A sequence of atmospheric rivers is called a AR family, started on Saturday and didn’t leave much of a gap before the Monday night set-up. This lack of recovery time is a major factor in increasing flood risk.

Parts of Utah and Colorado received snow on Monday, bringing snowfall totals to several feet in some places throughout atmospheric river events. 50 inches in Collins, Utah, 49 inches in Rabbit Ears Pass, Colorado.

A stage 4 of 5 storm surge is forecast to hit the entire coast of Oregon this week. The storm surge peaked at 5 out of 5 in the northwestern part of the state Monday night into early Tuesday morning.

But this latest round of moisture has also brought warmer temperatures, including a high of 65 degrees in Portland, which tied the city’s all-time high for December last year, 1993.

These warm conditions have promoted snowmelt across the Pacific Northwest and lead to excess runoff and rising creeks and streams.

Heavy rainfall also increases the risk of landslides or debris flows in wildfire-burned areas because the subsoil has less capacity to absorb moisture.

Not all atmospheric river phenomena are bad. In fact, AR event stages 1 and 2 are often considered beneficial rains and are much needed across the western United States to produce water supply levels. But AR event levels 4 and 5 are more dangerous than beneficial because the flooding and travel hazards outweigh the benefits.

CNN’s Alison Sinzar, Sarah Tonks and Andy Ross contributed to this report.

ALBUQUERQUE, NM – A mysterious and deadly disease continues to plague dogs across the country, so New Mexico’s top veterinarian is warning dog owners what to watch out for.

The disease begins with a persistent cough that lasts for weeks, then the dog becomes lethargic and refuses to eat. These are just the first signs.

“There are many different types of respiratory diseases in dogs, most of which are treatable or preventable with vaccines,” said Dr. Samantha Uhrig, state veterinarian for the New Mexico Veterinary Board. “It, for whatever reason, doesn’t respond well to treatment.”

Because antibiotics don’t work, veterinarians and researchers at Colorado State University’s College of Veterinary Medicine and Biomedical Sciences believe it’s a virus — but much less is known right now.

“Testing is now underway to determine what the cause is, but at this time, we don’t know the cause,” Uhrig said.

The disease has been reported in 14 US states, including Colorado. Because it’s so close to home, Uhrig says it’s only a matter of time before it’s discovered in New Mexico.

“It certainly puts New Mexico at risk as neighboring states experience this,” Uhrig said. “At this time, we have no confirmed cases and we rely on our veterinarians in private practice to report those cases to us.”

Because little is known, dogs are confirmed to have the virus when tests for other known respiratory diseases are negative.

As many people plan to travel on vacation, the disease may find new ways to spread from dog to dog.

“If you’re going to board your dog or take it somewhere it’s really important to have those vaccinations at least two weeks before your dog is exposed to other dogs,” Uhrig said.

Again, no cases have been reported in New Mexico yet, but dog owners should keep a close eye on their pets. If your dog’s cough persists, take them to the vet for a checkup.

Dec 4 (Reuters) – Shares of Hawaiian Airlines parent Hawaiian Holdings ( HA.O ) nearly tripled on Monday after it agreed to buy Alaska Air Group ( ALK.N ) for $1.9 billion, including debt.

Hawaiian shares were trading at $13.40 in morning trading, while Alaska’s offer price of $18 per share was made public Sunday, with some analysts saying regulatory approval was uncertain.

The company’s shares have fallen in recent months due to the impact of the Maui wildfires, higher fuel costs and jet engine recall problems on some of its Airbus SE ( AIR.PA ) planes. Its shares have fallen 52.6% so far this year.

According to LSEG, Hawaiian currently has a negative price-earnings (PE) ratio of 1.5, compared to a positive forward 12-month PE ratio of 8.2 for Alaska Air, reflecting losses.

Alaska and Hawaii signed a $929.4 million equity deal on Sunday that will expand their networks and offer travelers more choices.

“This transaction makes good common sense for both airlines,” TD Cowen analyst Helen Becker wrote in a note.

The deal will help Alaska grow in the lucrative Asia Pacific market, while Hawaiian customers can travel nonstop to the U.S. mainland, Becker added.

“The high premium on this deal is justified by the extensive network synergies the combined company can achieve with minimal investment,” said Craig Jenks, president of Airline/Flight Projects, a New York-based aviation consultancy. 270% premium.

However, regulatory opposition to the merger is likely. The U.S. Justice Department filed a lawsuit in March to block JetBlue from buying Spirit Airlines ( SAVE.N ).

JetBlue shares pared losses to trade flat in premarket trading, while Spirit shares rose 6.5% on Monday.

Shares of Seattle-based Alaska Air fell 17.6%.

Our Standards: Thomson Reuters Trust Principles.

The NCAA transfer portal cycle for the 2024 college football season is officially open. Starting from 4th December to Jan. 2, the portal is fully geared with the FBS transfer window till 2024. Although some players declared their intention to transfer earlier on Monday, they could not officially enter the portal until it opened.

With thousands of FBS players entering the gates each cycle, the NIL has become a differentiating factor in player acquisition, and expect plenty of movement in what has become one of the most important periods of the college football calendar.

In addition to the notable transfer players listed below as the process continues next month, keep the CBS Sports and 247Sports transfer portal window locked here as it features a top-to-bottom live tracker, updated rankings and more. Click the main links below and keep scrolling for live updates.

NCAA Transfer Portal via 247Sports: Recent Portal Additions | Team exchange ranking

Most Notable Players in Exchange Portal 2024

• Kyle McCord, QB, Ohio State
• Walter Nolan, DL, Texas A&M (announced)
• Dillon Gabriel, QB, Oklahoma (announced)
• Dante Moore, QB, UCLA (announced)
• Cameron Ward, QB, Washington State (announced)
• Will Howard, QB, Kansas State (announced)
• Tobias Merriweather, WR, Notre Dame (reported)
• Riley Leonard, QB, Duke (announced)
• DJ Uiagalelei, QB, Oregon State (announced)
• Grayson McCall, QB, Coastal Carolina (announced)

DUBAI, United Arab Emirates (AP) — A U.S. warship and several merchant vessels were attacked in the Red Sea Sunday, the Pentagon said, marking a major escalation in a series of naval attacks in the Middle East linked to the Israel-Hamas war. .

“We are aware of reports of attacks on the USS Carney and merchant vessels in the Red Sea and will provide information as it becomes available,” the Pentagon said.

Carney is an Arleigh Burke-class destroyer.

The British military earlier said there were suspicious drone strikes and explosions in the Red Sea.

The Pentagon does not believe where the fire originated. However, Yemen’s Iran-backed Houthi rebels have been carrying out a series of attacks on ships in the Red Sea, as well as launching drones and missiles targeting Israel against Hamas in the Gaza Strip.

A US official, who spoke on condition of anonymity to discuss intelligence matters, said the attack began around 10 a.m. in Sana’a, Yemen, and lasted for five hours. Another US official, who spoke on condition of anonymity for the same reason, said Carney intercepted at least one drone during the attack.

There was no immediate comment from the Houthis. However, a Houthi military spokesman said earlier that an “important” statement would be released soon.

Global shipping has increasingly been targeted as the Israel-Hamas war threatens to escalate into a wider regional conflict. A truce briefly halted the fighting And Hamas exchanged hostages for Palestinian prisoners captured by Israel. However, the collapse of the cease-fire and the resumption of punishing Israeli airstrikes and its ground attacks raised the risk of a resumption of seaborne attacks.

Earlier in November, the Houthis They impounded the vehicle transport vessel Yemen is connected to Israel on the Red Sea. Rebels still have the ship near the port city of Hodeidah. Missiles landed near another US warship last week after helping an Israeli-bound ship that was briefly seized by militants.

However, the Houthis have not directly targeted the Americans, further raising the stakes in the escalating maritime conflict. In 2016, the US launched Tomahawk cruise missiles Destroyed three coastal radar sites In response to missiles fired at US naval vessels at the time in Houthi-controlled territory.

___

Associated Press writer Tara Cope contributed from Dallas.