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  • ‘I’m paycheck to paycheck.’ I make $350K a year, but have $88K in student loans, $170K in car loans and a mortgage I pay $4,500 a month on. Do I need professional help?

    ‘I’m paycheck to paycheck.’ I make $350K a year, but have $88K in student loans, $170K in car loans and a mortgage I pay $4,500 a month on. Do I need professional help?

    I’m the first of my generation to own a home and the first to earn this much annually and don’t want to mess this up. How, specifically, can a financial adviser help me?


    Getty Images

    Question: By the end of 2022, I will have made $350,000 before taxes as the sole breadwinner and head of household. This is a great starting point and I’m very aware how blessed we are to be in this position, but I’m always looking ahead on how to improve. I currently have $88K left in student loans (originally close to $150K) and very little credit card debt (less than $2K with more than $25K available). I have two auto loans totaling $170K for two electric vehicles at 5% interest.

    I’ve recently been offered a $200K HELOC at 9%, which would help me bring down some of my monthly payments and do some small home repairs and improvements, but I want to make the right moves. And I’ve also been presented with a few long-term real estate investment opportunities that are rental properties out of state and are currently bringing it 10-12% ROI.  But my biggest concern is that after taxes, 401(k) contributions, bills, savings and mortgage ($4,500), on paper I’m paycheck to paycheck. I’d like to use this HELOC to consolidate debt while also participating in some of these investment opportunities. I’m the first of my generation to own a home and the first to earn this much annually and don’t want to mess this up. How, specifically, can a financial adviser help me? (Looking for a new financial adviser too? This tool can help match you with an adviser who might meet your needs.)

    Answer: You have a few questions to tackle here, so let’s go one by one. The first being the HELOC. Yes, HELOCs can be a good way to consolidate debt, but the rate you’re being offered isn’t favorable, as average HELOC rates are a little over 6%. “I would ask if 9% is the best rate you can get, because it appears a bit high,” says Chris Chen, certified financial planner at Insight Financial Strategists. What’s more, “I would like you to consider the potential impact that our Fed policy and inflation are having on interest rates, as HELOCs usually have variable interest rates and we’re in an environment with rising rates. You may start at 9% and end up significantly higher,” says Chen. 

    What’s more, your student loans, car loans and mortgage are all likely less than 9%, so it’s not likely that consolidation via a HELOC would save you money. “You may want to start somewhere different, like the snowball method, where you focus on one loan, usually the smallest one, and direct all of your resources to pay off that loan while maintaining payments on the others,” says Chen. This method could work to finish off your student loans and maybe one of your car loans, to start with. 

    Have an issue with your financial adviser or have questions about hiring a new one? Email picks@marketwatch.com.

    As for those real estate investments, what do you really know about those returns? “With regards to real estate investments, I assume that the 10% to 12% ROI you speak of is the income that you would be getting from the investment. If so, that’s very high and often when you get a return that is significantly higher than the norm, there’s something else that makes the investment less desirable. Be careful,” says Chen. (Looking for a new financial adviser too? This tool can help match you with an adviser who might meet your needs.)

    Certified financial planner Kaleb Paddock says you may actually want to work with a money coach before you work with a financial adviser. Whereas a financial adviser assists with developing investment strategies and long-term financial plans, a money coach offers a more educational experience and focuses on shorter term goals for money management. “A money coach will help you with paying off all of your debts, maximize your cash flow and help you create systems and processes to direct your money proactively,” says Paddock. 

    While having a high income is great, there’s a concept called Parkinson’s Law, which essentially states that your spending will always rise to meet your income no matter how high that income rises, explains Paddock. “Working with a money coach will help you defeat Parkinson’s Law, eliminate your debt and then enable you to supercharge your investing and life planning with a financial adviser,” says Paddock.

    A financial adviser could help too, and Danielle Harrison, certified financial planner at Harrison Financial Planning, says to look for one who does comprehensive financial planning and can help you create a more holistic plan for your money. “They can assist you in the creation of both short and long-term goals and then help you by giving guidance on the financial decisions and opportunities you are presented with,” says Harrison.

    A financial adviser would also help you take a long-term approach to your money and help you create a spending plan where you don’t feel like you’re living paycheck to paycheck on a $350,000 salary. “Everyone has blind spots when it comes to their finances, so finding a competent financial partner can be invaluable,” says Harrison. (Looking for a new financial adviser too? This tool can help match you with an adviser who might meet your needs.)

    Have an issue with your financial adviser or have questions about hiring a new one? Email picks@marketwatch.com.

    *Questions edited for brevity and clarity.

    The advice, recommendations or rankings expressed in this article are those of MarketWatch Picks, and have not been reviewed or endorsed by our commercial partners.

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  • Netherlands eliminates U.S. in round of 16 at World Cup

    Netherlands eliminates U.S. in round of 16 at World Cup

    Memphis Depay and Daley Blind scored in the first half and Denzel Dumfries added a late goal as the Netherlands eliminated the United States from the World Cup with a 3-1 victory Saturday that advanced the Dutch to the quarterfinals.

    Second-half substitute Haji Wright cut the U.S. deficit to 2-1 in the 76th minute when Christian Pulisic’s cross hit his trailing foot and popped over goalkeeper Andries Noppert and into the net. But Dumfries, who assisted on the first two goals, scored on a volley in the 81st.

    Runners-up in 1974, 1978 and 2010, the Oranje extended their unbeaten streak to 19 games and face Argentina or Australia on Friday.

    It was a disappointing end for a rebuilt U.S. team hoping to advance past the round of 16 for the first time since 2002. Using the second-youngest squad in the tournament, the Americans achieved the bare minimum to consider the World Cup a success, beating Iran in their group-stage finale to reach the knockout round.

    But just like in 2010 against Ghana and 2014 against Belgium, the United States was eliminated in the round of 16. The Americans are winless in 12 games against European opponents at the World Cup since 2002, losing six, and are 1-7 during the tournament’s knockout rounds.

    Pulisic, playing four days after getting hurt during his game-winning goal against Iran, had a chance to put the United States ahead in the third minute but Noppert, playing in only his fourth international match, blocked his point-blank shot. With the Americans seeking an equalizing goal, Noppert dived to stop Tim Weah’s 25-yard effort in the 42nd.

    The crowd of 44,846 was well back from the field at renovated Khalifa International Stadium, which has an athletics track and was more subdued than the raucous spectators for the match against Iran.

    While the United States had the better play at the start, the Dutch went ahead after breaking the American press. Dumfries one-timed a pass from the right flank as Depay streaked unmarked into the penalty area. His right-footed shot from 14 yards beat Matt Turner to the far post in the 10th minute for his 43rd international goal, moving him into sole possession of second place on the Dutch career scoring list behind Robin van Persie’s 50.

    The goal was the first allowed by the United States from the run of play in the tournament. In 37 World Cup matches, the Americans have never won a game in which they trailed.

    The Netherlands doubled the lead on virtually the final kick of the first half, in the first minute of stoppage time. After a quick series of exchanges following a throw-in, Dumfries got a cross around Tyler Adams and found Blind wide open at the penalty spot. Blind scored only his third international goal — his first in eight years. Gio Reyna fed an open Weston McKennie in the 54th, but he skied his shot over the crossbar.

    Wright entered in the 67th and scored his second international goal, sparking U.S. hopes. But Dumfries was left unmarked by Tim Ream and Antonee Robinson and used his left foot to volley Blind’s cross.

    YOUNG AND THE RESTLESS
    The starting lineup for the United States was its youngest for a World Cup knockout match at 25 years, 86 days. The previous low was 27 years, 19 days for the 1930 semifinal loss to Argentina.

    TRAINER’S ROOM
    United States forward Josh Sargent did not dress after injuring his right ankle against Iran.

    UP NEXT
    The Netherlands will next play Friday at Lusail Stadium, the site of this year’s final.
    The Americans begin the 2026 cycle with a match against Serbia on Jan. 25 in Los Angeles and face Colombia three days later in Carson, California. The games are not on FIFA dates, meaning mostly Major League Soccer players will be used.

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  • Netherlands eliminates U.S. in round of 16 at World Cup

    Netherlands eliminates U.S. in round of 16 at World Cup

    Memphis Depay and Daley Blind scored in the first half and Denzel Dumfries added a late goal as the Netherlands eliminated the United States from the World Cup with a 3-1 victory Saturday that advanced the Dutch to the quarterfinals.

    Second-half substitute Haji Wright cut the U.S. deficit to 2-1 in the 76th minute when Christian Pulisic’s cross hit his trailing foot and popped over goalkeeper Andries Noppert and into the net. But Dumfries, who assisted on the first two goals, scored on a volley in the 81st.

    Runners-up in 1974, 1978 and 2010, the Oranje extended their unbeaten streak to 19 games and face Argentina or Australia on Friday.

    It was a disappointing end for a rebuilt U.S. team hoping to advance past the round of 16 for the first time since 2002. Using the second-youngest squad in the tournament, the Americans achieved the bare minimum to consider the World Cup a success, beating Iran in their group-stage finale to reach the knockout round.

    But just like in 2010 against Ghana and 2014 against Belgium, the United States was eliminated in the round of 16. The Americans are winless in 12 games against European opponents at the World Cup since 2002, losing six, and are 1-7 during the tournament’s knockout rounds.

    Pulisic, playing four days after getting hurt during his game-winning goal against Iran, had a chance to put the United States ahead in the third minute but Noppert, playing in only his fourth international match, blocked his point-blank shot. With the Americans seeking an equalizing goal, Noppert dived to stop Tim Weah’s 25-yard effort in the 42nd.

    The crowd of 44,846 was well back from the field at renovated Khalifa International Stadium, which has an athletics track and was more subdued than the raucous spectators for the match against Iran.

    While the United States had the better play at the start, the Dutch went ahead after breaking the American press. Dumfries one-timed a pass from the right flank as Depay streaked unmarked into the penalty area. His right-footed shot from 14 yards beat Matt Turner to the far post in the 10th minute for his 43rd international goal, moving him into sole possession of second place on the Dutch career scoring list behind Robin van Persie’s 50.

    The goal was the first allowed by the United States from the run of play in the tournament. In 37 World Cup matches, the Americans have never won a game in which they trailed.

    The Netherlands doubled the lead on virtually the final kick of the first half, in the first minute of stoppage time. After a quick series of exchanges following a throw-in, Dumfries got a cross around Tyler Adams and found Blind wide open at the penalty spot. Blind scored only his third international goal — his first in eight years. Gio Reyna fed an open Weston McKennie in the 54th, but he skied his shot over the crossbar.

    Wright entered in the 67th and scored his second international goal, sparking U.S. hopes. But Dumfries was left unmarked by Tim Ream and Antonee Robinson and used his left foot to volley Blind’s cross.

    YOUNG AND THE RESTLESS
    The starting lineup for the United States was its youngest for a World Cup knockout match at 25 years, 86 days. The previous low was 27 years, 19 days for the 1930 semifinal loss to Argentina.

    TRAINER’S ROOM
    United States forward Josh Sargent did not dress after injuring his right ankle against Iran.

    UP NEXT
    The Netherlands will next play Friday at Lusail Stadium, the site of this year’s final.
    The Americans begin the 2026 cycle with a match against Serbia on Jan. 25 in Los Angeles and face Colombia three days later in Carson, California. The games are not on FIFA dates, meaning mostly Major League Soccer players will be used.

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  • Democrats move to make South Carolina, not Iowa, first primary voting state

    Democrats move to make South Carolina, not Iowa, first primary voting state

    Democrats voted Friday to remove Iowa as the leadoff state on the presidential nominating calendar and replace it with South Carolina starting in 2024, a dramatic shakeup championed by President Joe Biden to better reflect the party’s deeply diverse electorate.

    The Democratic National Committee’s rule-making arm made the move to strip Iowa from the position it has held for more than four decades after technical meltdowns sparked chaos and marred results of the state’s 2020 caucus.

    The change also comes after a long push by some of the party’s top leaders to start choosing a president in states that are less white, especially given the importance of Black voters as Democrats’ most loyal electoral base.

    Discussion on prioritizing diversity drew such impassioned reaction at the committee gathering in Washington that DNC chair Jaime Harrison wiped away tears as committee member Donna Brazile suggested that Democrats had spent years failing to fight for Black voters: “Do you know what it’s like to live on a dirt road? Do you know what it’s like to try to find running water that is clean?”

    “Do you know what it’s like to wait and see if the storm is going to pass you by and your roof is still intact?” Brazile asked. “That’s what this is about.”

    Following Biden’s recommendations, the committee also opted to have New Hampshire and Nevada jointly vote second, a week after South Carolina, followed by Georgia and Michigan, two critical battleground states that would round out the top five in subsequent weeks.

    All the proposed contests would likely be held in February 2024.

    That’s a change from the current calendar, with Iowa holding the first-in-the-nation caucuses since 1972, followed by New Hampshire’s first-in-the-nation primary since 1920.

    Nevada and South Carolina have gone next since the 2008 presidential election, when Democrats last did a major overhaul of their primary calendar.

    The move will still have to be approved by the full DNC in a vote likely early next year, but it will almost certainly follow the rule-making committee’s lead.

    The revamped schedule could largely be moot for 2024 if Biden opts to seek a second term, but may remake Democratic presidential cycles in 2028 and beyond.

    The president has said for months that he intends to run again, and White House aides have begun making staffing discussions for his likely reelection campaign, even though no final decision has been made.

    Biden wrote in a letter to rules committee members on Thursday that the party should scrap “restrictive” caucuses altogether because their rules on in-person participation can sometimes exclude working-class and other voters.

    He told also told party leaders privately that he’d like to see South Carolina go first to better ensure that voters of color aren’t marginalized as Democrats choose a presidential nominee.

    Four of the five states now poised to start the party’s primary are presidential battlegrounds, meaning the eventual Democratic winner would be able to lay groundwork in important general election locales.

    That’s especially true for Michigan and Georgia, which both voted for Donald Trump in 2016 before flipping to Biden in 2020. The exception is South Carolina, which hasn’t gone Democratic in a presidential race since 1976.

    The first five voting states would be positioned to cast ballots before Super Tuesday, the day when much of the rest of the country holds primaries. That gives the early states outsize influence since White House hopefuls struggling to raise money or gain political traction often drop out before visiting much of the rest of the country.

    Scott Brennan, a rules committee member from Iowa, said “small, rural states” like his “must have a voice in the presidential nominating process.”

    “Democrats cannot forget about entire groups of voters in the heart of the Midwest without doing significant damage to the party in newer generations,” Brennan said.

    The Republican National Committee has already decided to keep Iowa’s caucus as the first contest in its 2024 presidential primary, ensuring that GOP White House hopefuls — which include Trump — have continued to frequently campaign there.

    House Majority Whip Jim Clyburn, South Carolina’s lone congressional Democrat and one of Biden’s top supporters in Congress, said the president called him Thursday to inform him of his push to move his state up.

    “I didn’t ask to be first,” Clyburn said. “It was his idea to be first.”

    Clyburn’s endorsement of Biden in 2020 boosted the candidate’s flagging presidential campaign just ahead of South Carolina’s primary, which he won big. That helped Biden shake off early losses in Iowa, New Hampshire and Nevada and eventually take the White House.

    “He knows what South Carolina did for him, and he’s demonstrated that time and time again, by giving respect to South Carolina,” Clyburn said.

    Still, the vote by the rules committee has faced serious pushback, with some states vowing to ignore the changes altogether. That’s despite the panel approving language saying states could lose all of their delegates to the party’s national convention if they attempt to violate new rules.

    Iowa and New Hampshire have said laws in their states mandate them going before others, and they intend to abide by those, not DNC decrees.

    Nevada, with its heavily Hispanic population, has balked at sharing the second-place slot with New Hampshire, a state 2,500 miles away.

    Nevada committee member Artie Blanco’s voice cracked as she argued against the change.

    “If we want to build a strong relationship with Latinos,” Blanco said, “then Nevada must stand alone on a date and not have to share that date.”

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  • Dow ekes out gain Friday, stocks book second week in a row of gains

    Dow ekes out gain Friday, stocks book second week in a row of gains

    Major U.S. stock indexes ended a choppy session mixed Friday, while still posting weekly gains, after monthly jobs data showed the Federal Reserve’s rapid pace of interest rate hikes has yet to tame the roaring labor market. The Dow Jones Industrial Average
    DJIA,
    +0.10%
    rose about 33 points Friday, or 0.1%, ending near 34,428, after flipping between gains and losses. The S&P 500 index shed 0.1% and the Nasdaq Composite Index
    COMP,
    -0.18%
    lost 0.2%, according to FactSet. The main benchmarks still booked a second weekly advance in a row. The Dow rose 0.2% for the week, the S&P 500 gained 1.1% and the Nasdaq closed the week up 2.1%, according to FactSet. A hope that Federal Reserve officials might be able to raise rates at a slower pace in December has been feeding a more bullish tone in markets over the past two months, helping to significantly trimming year-to-date losses. But with the U.S. unemployment rate still low at 3.7% and wages rising in November, concerns resurfaced about the potential need for aggressive Fed actions to bring inflation down. Economists said Friday that could put another jumbo rate increase back on the table ahead of the holidays.

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  • Inflation and credit-card debt are on the rise, despite a strong job market. Tell us how the economy is affecting you.

    Inflation and credit-card debt are on the rise, despite a strong job market. Tell us how the economy is affecting you.

    We want to hear from readers who have stories to share about the effects of increasing costs and a changing economy. If you’d like to share your experience, write to readerstories@marketwatch.com. Please include your name and the best way to reach you. A reporter may be in touch.

    For many people living in the U.S., these are tough — and confusing — times.

    On Friday, the Labor Department reported 263,000 new jobs in November, while the unemployment rate held steady at 3.7%. Layoffs remain low, despite mass job cuts in the tech sector. Average hourly wages have also risen 5.1% in the past year, but still lag behind inflation for many workers. And there were 10.3 million job openings in October — slightly down from the previous month’s 10.7 million. 

    Some people might see the latest economic data as both challenging and confusing.

    After all, the cost of living rose 7.7% on the year in October. The once red-hot housing market is finally cooling, thanks to mortgage rates that have more than doubled over the last year amid the Federal Reserve’s attempts to rein in inflation, and rents, while moderating, have surged from pre-pandemic levels. Borrowing money to cover increased precarity is becoming more expensive too, with the average credit-card APR at 19.2% as of Nov. 30, according to Bankrate.

    “‘It’s just mind-boggling, the disconnect that we’ve seen.’”

    Given all the conflicting signals, economists say it can be difficult for consumers to know exactly how to feel about the economy right now. “It’s not new, this disparity between the actual facts on the ground about what’s going on in the economy and the sentiment,” said Heidi Shierholz, president of the Economic Policy Institute, a left-leaning think tank. 

    “I remember this summer it was just unambiguously the strongest jobs recovery we’ve had in decades,” she added. “There’s just absolutely zero chance that we were in a recession — not only were we not in a recession, we were in just an extraordinarily fast recovery — and the polling, a huge share of people actually thought we were in a recession. It’s just mind-boggling, the disconnect that we’ve seen.”

    Still, the fact that inflation is eating into people’s savings — and that essential goods like food, energy and housing have spiked in cost — is bound to make many people unhappy. 

    Struggling to pay for rent and food

    “Going into the pandemic, more than seven out of every 10 extremely low-income renters were already spending more than half of their income on rent. And then the pandemic hits; we saw a lot of low-wage workers lose their jobs and see an income decline,” said Andrew Aurand, vice president for research at the National Low Income Housing Coalition. “Then in 2021, we see this huge spike in prices. For a variety of reasons, they’ve struggled for a long time, and since the pandemic, it’s gotten even worse.”

    Moderate-income Americans are struggling too. Maybe you can’t afford your favorite family meals, as the price of grocery store and supermarket purchases has jumped by 12.4% from last year. Or maybe you’re putting off a trip to see family this holiday season thanks to the higher cost of airfare, or you’re worried about losing your job as some business leaders warn of a recession. Perhaps you’re forced to rely on credit cards and personal loans, as credit-card debt is up 15% from a year ago.

    MarketWatch has chronicled many of these changes, detailing renters’ frustrations, families’ tough choices at the grocery store, and the reality faced by would-be home buyers sidelined by higher rates and dwindling affordability. 

    But we would like your help telling an ongoing story about the American economy, centering the experiences of everyday people. Our readers know better than anyone about how today’s economic conditions have impacted their daily lives.

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  • U.S. COVID cases are climbing again as new omicron variants spread

    U.S. COVID cases are climbing again as new omicron variants spread

    COVID-19 cases and hospitalizations in the U.S. are rising and intensive-care-unit beds are being filled again, in a trend that may spell an end to the stable period the country experienced during the fall months.

    The daily average of new cases was up 22% on Thursday from two weeks ago, to 49,070, according to a New York Times tracker. Cases are rising in 40 states, led by Oklahoma, where they are up 89% from two weeks ago.

    The daily average for hospitalizations is up 21% from two weeks ago to 33,708, although as always, the trend is not uniform across the nation. Louisiana is the state with the highest increase in hospitalizations, up 109% from two weeks ago, followed by California, where they have climbed 66%.

    Visits to the ICU are up 17%, while test-positivity rates are up 29%, to 10%, the tracker shows. On a brighter note, the daily average for deaths is down 3% to 274. 

    Experts are warning that new omicron subvariants are on the rise and are quickly replacing earlier ones.

    The most recent data release from the Centers for Disease Control and Prevention showed that the BQ.1.1 and BQ.1 sublineages of BA.5 accounted for 62.8% of all cases in the U.S. in the week through Dec. 3, exceeding the 13.8% of cases caused by BA.5.

    That was up from 57.3% of cases in the week through Nov. 26, when 19.4% of cases were caused by BA.5.

    In the New York region, which includes New Jersey, Puerto Rico and the U.S. Virgin Islands, those numbers were even higher, with BQ.1 and BQ.1.1 accounting for 72.4% of all cases, compared with 6.9% for BA.5.

    That was up from the prior week, when BQ.1 and BQ.1.1 accounted for 70.8% of all cases, compared with 10.4% for BA.5.

    See now: Elon Musk may want employees back in the office, but 29% of Americans still work from home

    For now, the new sublineages have not been shown to be likely to cause more severe disease than earlier ones, but they are more transmissible, which is why they have become dominant.

    Experts continue to urge people to get their updated booster, which is the best protection against developing severe COVID or dying of it.

    Coronavirus Update: MarketWatch’s daily roundup has been curating and reporting all the latest developments every weekday since the coronavirus pandemic began

    Other COVID-19 news you should know about:

    • Local governments in China are facing a new challenge in the battle against COVID: They are running out of cash needed to finance mass testing and enforce quarantines, CNN reported on Friday. The zero-COVID policy kept China out of recession in 2020, but now the bills are mounting, placing financial strain on municipal authorities across the world’s most populous nation, said CNN. For nearly three years, local governments have borne the brunt of enforcing pandemic controls. 

    • Former NBA star Jeremy Lin, who plays for a Chinese team, was fined 10,000 yuan ($1,400) for criticizing quarantine facilities, according to China’s professional league and a news report Friday, the AP reported. The ruling Communist Party is trying to crush criticism of the human cost and disruption of its zero-COVID strategy, which has confined millions of people to their homes.

    Large protests erupted across China as crowds voiced their frustration over nearly three years of COVID-19 controls. Here’s how a deadly fire in Xinjiang sparked domestic upheaval and a political dilemma for Xi Jinping’s leadership. Photo: Thomas Peter/Reuters

    • Formula One confirmed Friday that the Chinese Grand Prix will not take place in 2023, making it the fourth year in a row the race has been canceled because of the coronavirus pandemic, the AP reported separately. “Formula One can confirm, following dialogue with the promoter and relevant authorities, that the 2023 Chinese Grand Prix will not take place due to the ongoing difficulties presented by the COVID-19 situation,” Formula One said in a statement.

    • German doctors are warning that pediatric units are stretched to the breaking point in some hospitals in part due to rising cases of respiratory infections among infants, the AP reported. The intensive-care association DIVI said the seasonal surge in cases of respiratory syncytial virus and a shortage of nurses was causing a “catastrophic situation” in hospitals. RSV is a common, highly contagious virus that infects nearly all babies and toddlers by age 2, some of whom can fall seriously ill. Experts say the easing of coronavirus pandemic restrictions means RSV is currently affecting a larger number of babies and children whose immune systems aren’t primed to fend off the infection.

    Physicians are reporting high numbers of respiratory illnesses like RSV and the flu earlier than the typical winter peak. WSJ’s Brianna Abbott explains what the early surge means for the winter months. Photo illustration: Kaitlyn Wang

    Here’s what the numbers say:

    The global tally of confirmed cases of COVID-19 topped 644.1 million on Friday, while the death toll rose above 6.63 million, according to data aggregated by Johns Hopkins University.

    The U.S. leads the world with 98.9 million cases and 1,081,147 fatalities.

    The Centers for Disease Control and Prevention’s tracker shows that 228.4 million people living in the U.S., equal to 68.8% of the total population, are fully vaccinated, meaning they have had their primary shots.

    So far, just 39.7 million Americans have had the updated COVID booster that targets the original virus and the omicron variants, equal to 12.7% of the overall population.

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  • November jobs report is most important data for inflation this year- and not in a good way

    November jobs report is most important data for inflation this year- and not in a good way

    The November U.S. jobs report on Friday showed the U.S. economy gained 261,000 jobs last month, with the unemployment rate holding steady at 3.7%.

    Economists polled by the Wall Street Journal had expected an addition of 200,000 jobs.

    Wages jumped 0.6% in November, double the expected pace.

    Below are some initial reactions from economists and other analysts as U.S. stocks
    DJIA,
    -0.20%

    SPX,
    -0.37%
    traded lower and the yield on the 10-year Treasury note
    TMUBMUSD10Y,
    3.569%
    jumped following the data on nonfarm payrolls.

    • “You probably want to revise your view on inflation and it’s overall dynamic more based on today’s job report than any other data report this entire year. And not in a favorable direction,” The report dashes hopes wage growth was cooling, said Jason Furman, economics professor at Harvard and former Obama White House economist, in a tweet.

    • “A stronger than expected 263,000 monthly payroll print plus the spike in wages…will reinforce the Fed’s assessment that the labor market remains very overheated, and rates will need to go higher for longer in order to bring it back into balance,” said Krishna Guha, vice chairman of Evercore ISI.

    • “The Fed will not like the renewed strength in wages,” said Ian Shepherdson, chief economist at Pantheon Macroeconomics.

    • “The U.S. labor market has lost some momentum this year, but it’s still speeding ahead as we approach the new year. Continue to underestimate the momentum in the U.S. labor market at your own peril. Job gains continue to be added at a pace that would have drawn cheers in 2019. The labor market might encounter some bumps in the road next year, but it’s heading into 2023 cruising,” said Nick Bunker, head of economic research at the Indeed Hiring Lab.

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  • U.S. adds 263,000 jobs in November and wages rise sharply — far too much for the Fed’s liking

    U.S. adds 263,000 jobs in November and wages rise sharply — far too much for the Fed’s liking

    The numbers: The U.S. created a robust 263,000 new jobs in November, a historically strong pace of hiring that’s good for workers but that also threatens to prolong a bout of high U.S. inflation.

    The continued rapid gains in hiring have become a big source of angst at the Federal Reserve. Senior central bank officials worry that wage growth stemming from a tight labor market is adding upward pressure to already high U.S. inflation.

    The Fed is expected to keep raising interest rates — and pushing the economy closer to recession — until hiring slows, labor shortages ease and wage growth drops off.

    U.S. stocks fell in premarket trades and bond yields rose after the report. Economists polled by The Wall Street Journal had forecast a smaller increase in new jobs of 200,000.

    The U.S. economy created 263,000 new jobs in November — far more than Wall Street had expected.


    Justin Sullivan/Getty Images

    The unemployment rate was unchanged at 3.7%, the government said Friday, remaining close to a half-century low.

    Hourly pay, meanwhile, rose by a sharp 0.6% last month to an average of $32.82. That’s the biggest advance in 13 months and was far stronger than Wall Street expected.

    The increase in wages over the past year climbed to 5.1%, from 4.9% in the prior month. Wages are still rising much faster than they were before the pandemic, when they rose about 2% to 3% a year.

    The demand for labor is still strong,” said chief economist Steve Blitz of TS Lombard. “It’s still putting upward pressure on wages.”

    The Fed has embarked on a series of increases in U.S. interest rates to try to slow the economy just enough to tame inflation without tipping it into recession.

    The bank is trying to bring inflation back down to prepandemic levels of 2% from the current rate of 6%, based on the PCE price index.

    “The level of [hiring] is not conducive to getting the base inflation rate back to 2%,” Blitz said.

    The tough medicine, senior Fed officials figure, is likely to lift the unemployment rate to as high as 5% by 2023. Some Wall Street analysts believe the jobless rate will go even higher if a recession takes hold, as many are forecasting.

    Higher borrowing costs slow growth by depressing consumer spending and business investment, the two key pillars of the economy.

    Another potential pressure valve for the economy is also not offering any relief. The share of working-age people in the labor force — known as the labor-force participation rate — fell a tick to 62.1%, marking the third drop in a row.

    The lack of people looking for work is another big factor contributing to the labor shortage.

    Key details: The increase in employment last month was concentrated in hotels, restaurants and healthcare businesses. Americans have gone back to seeing their doctors and are spending more on travel and entertainment.

    Hiring also rose in construction and manufacturing, two areas of the economy that are under more duress, while government employment increased by 42,000.

    There were some signs of labor-market softness in the report. Retail employment shrank for the third month in a row, and warehouse and transportation jobs also declined.

    Hiring at professional businesses, a leader in employment, rose by a meager 6,000. That’s the smallest increase since April 2021.

    Hiring in October and September were little changed after government revisions. The economy added 284,000 jobs in October and 269,000 in September.

    Big picture: The economy is slowing, but the labor force is still an oasis of strength.

    For the Fed, it’s too much of a good thing. The central bank wants the demand and supply of labor to become more balanced to ease the pressure on wages.

    The ongoing labor shortage, however, might be a saving grace for the economy. Many businesses have told the Fed they plan to hold onto more workers than usual even if the economy slows, because it’s been so hard to hire people in the first place.

    If that’s the case, the economy might escape a recession altogether or only suffer a short and shallow downturn, some economists say.

    Looking ahead: “Job creation continues to top expectations, holding the unemployment rate near half-century lows,” said Jim Baird, chief investment officer at Plante Moran Financial Advisors.

    “The Fed may be closing in on a point that the pace of rate hikes could be stepped down, but the combination of tight labor markets and stubbornly elevated inflation leaves policymakers with a clear directive: keep tightening.”

    Market reaction: The Dow Jones Industrial Average
    DJIA,
    -0.10%
    and S&P 500
    SPX,
    -0.12%
    were set to decline sharply in Friday trades.

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  • Appeals court ends special-master review of Trump documents, in win for Justice Department

    Appeals court ends special-master review of Trump documents, in win for Justice Department

    WASHINGTON — A federal appeals court on Thursday ended an independent review of documents seized from former President Donald Trump’s Florida estate, removing a hurdle the Justice Department said had delayed its criminal investigation into the retention of top-secret government information.

    The decision by the three-judge panel represents a significant win for federal prosecutors, clearing the way for them to use as part of their investigation the entire tranche of documents seized during an Aug. 8 FBI search of Mar-a-Lag o. It also amounts to a sharp repudiation of arguments by Trump’s lawyers, who for months had said that the former president was entitled to have a so-called “special master” conduct a neutral review of the thousands of documents taken from the property.

    The ruling from the Atlanta-based U.S. Court of Appeals for the 11th Circuit had been expected given the skeptical questions the judges directed at a Trump lawyer during arguments last week, and because two of the three judges on the panel had already ruled in favor of the Justice Department in an earlier dispute over the special master.

    The special master litigation has played out alongside an ongoing investigation examining the potential criminal mishandling of national defense information as well as efforts to possibly obstruct that probe. Attorney General Merrick Garland last month appointed Jack Smith, a veteran public corruption prosecutor, to serve as special counsel overseeing that investigation.

    It remains unclear how much longer the investigation will last, or who, if anyone, might be charged. But the probe has shown signs of intensifying, with investigators questioning multiple Trump associates about the documents and granting one key ally immunity to ensure his testimony before a federal grand jury. And the appeals court decision is likely to speed the investigation along by cutting short the outside review of the records.

    The conflict over the special master began just weeks after the FBI’s search, when Trump sued in federal court in Florida seeking the appointment of an independent arbiter to review the roughly 13,000 documents the Justice Department says were taken from the home.

    A federal judge, Aileen Cannon, granted the Trump team’s request, naming veteran Brooklyn judge Raymond Dearie to serve as special master and tasking him with reviewing the seized records and filtering out from the criminal investigation any documents that might be covered by claims of executive privilege or attorney-client privilege.

    She also barred the Justice Department from using in its criminal investigation any of the seized records, including the roughly 100 with classification markings, until Dearie completed his work.

    The Justice Department objected to the appointment, saying it was an unnecessary hindrance to its criminal investigation and saying Trump had no credible basis to invoke either attorney-client privilege or executive privilege to shield the records from investigators.

    It sought, as a first step, to regain access to the classified documents. A federal appeals panel sided with prosecutors in September, permitting the Justice Department to resume its review of the documents with classification markings.

    The department also pressed for access to the much larger trove of unclassified documents, saying such records could contain important evidence for their investigation.

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  • Dow, S&P 500 finish lower Thursday, kick off final month of a brutal year on a down note

    Dow, S&P 500 finish lower Thursday, kick off final month of a brutal year on a down note

    U.S. stocks finished mostly lower on Thursday, kicking off the final month of a brutal year for investors on a downbeat note. The Dow Jones Industrial Average
    DJIA,
    -0.56%
    fell about 194 points, or 0.6%, ending near 34,395. The S&P 500 index
    SPX,
    -0.09%
    fell 0.1%, while the Nasdaq Composite Index
    COMP,
    +0.13%
    rose 0.1%, according to FactSet. Stocks rallied sharply on Wednesday after Federal Reserve Chairman Jerome Powell indicated the central bank may soon downsize its pace or rate hikes after a series of jumbo increases of 75 basis points to the Fed’s policy rate. That has brought the benchmark rate to a range of 3.75% to 4%, its highest level in 15 years. But signs that U.S. inflation may be falling after being stuck near a 40-year high have encouraged Fed officials and investors, with the 10-year Treasury rate falling to 3.6% Thursday, its lowest yield in about two months, according to Dow Jones Market Data. The next big economic item for investors will be the release on Friday of October jobs data, which could help determine the size of the Fed’s next rate hike during its Dec. 13-14 Federal Open Market Committee meeting. The odds currently favor a 50 basis point increase.

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  • Dow, S&P 500 finish lower Thursday, kick off final month of a brutal year on a down note

    Dow, S&P 500 finish lower Thursday, kick off final month of a brutal year on a down note

    U.S. stocks finished mostly lower on Thursday, kicking off the final month of a brutal year for investors on a downbeat note. The Dow Jones Industrial Average
    DJIA,
    -0.56%
    fell about 194 points, or 0.6%, ending near 34,395. The S&P 500 index
    SPX,
    -0.09%
    fell 0.1%, while the Nasdaq Composite Index
    COMP,
    +0.13%
    rose 0.1%, according to FactSet. Stocks rallied sharply on Wednesday after Federal Reserve Chairman Jerome Powell indicated the central bank may soon downsize its pace or rate hikes after a series of jumbo increases of 75 basis points to the Fed’s policy rate. That has brought the benchmark rate to a range of 3.75% to 4%, its highest level in 15 years. But signs that U.S. inflation may be falling after being stuck near a 40-year high have encouraged Fed officials and investors, with the 10-year Treasury rate falling to 3.6% Thursday, its lowest yield in about two months, according to Dow Jones Market Data. The next big economic item for investors will be the release on Friday of October jobs data, which could help determine the size of the Fed’s next rate hike during its Dec. 13-14 Federal Open Market Committee meeting. The odds currently favor a 50 basis point increase.

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  • Senate passes bill to prevent rail strike, rejects measure providing paid sick leave

    Senate passes bill to prevent rail strike, rejects measure providing paid sick leave

    The U.S. Senate on Thursday voted 80-15 in favor of a bill that would prevent a rail strike by imposing a deal on freight-rail workers, after rejecting a separate House-passed measure that would require rail companies to provide those workers with seven days of paid sick leave per year.

    The vote for the bill imposing a deal keeps Washington on track to block a strike, as the House of Representatives passed it Wednesday. President Joe Biden is expected to sign the legislation into law given that he called on Monday for Congress to act.

    Business groups have been warning that even a short-term strike would have a tremendous impact and cause economic pain.

    The deal that would be imposed on rail employees includes a 24% increase in wages from 2020 through 2024, but workers have remained concerned about a lack of paid sick time.

    In the vote on sick leave, there were 52 senators in favor, while 43 were opposed, and 60 votes for it were needed. A half dozen Republican senators were in favor, while Sen. Joe Manchin of West Virginia was the only Democrat in opposition.

    “While I am sympathetic to the concerns union members have raised, I do not believe it is the role of Congress to renegotiate a collective bargaining agreement that has already been negotiated,” Manchin said in a statement. 

    Earlier Thursday, the Senate also voted against an amendment from Republican senators that aimed to deliver a cooling-off period so talks between rail companies and their workers could continue.

    Railroad operators’ stocks finished with gains Tuesday as traders reacted to Washington’s moves to prevent a strike, but Norfolk Southern Corp.
    NSC,
    -0.05%    ,
     CSX Corp. 
    CSX,
    -0.03%
    and Union Pacific Corp.
    UNP,
    -0.69%
    all lost ground Thursday as the broad market
    SPX,
    -0.09%

    DJIA,
    -0.56%
    closed mostly lower.

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  • This 82-year-old retiree makes makes moose calls

    This 82-year-old retiree makes makes moose calls

    Butch Phillips, an 82-year-old member of the Penobscot Nation, etches 18-inch long moose call horns from birch bark he harvests off tribal land. While some moose calls he gives away to local hunters, others have sold at auction for as much as $3,200 and some sit in museums.

    “It’s very exciting calling a moose. You can hear them coming. Snuffing and grunting,” said Phillips, who hunts a moose each year on tribal land, the largest being 940 pounds. He also sometimes calls moose just to watch them and study them.

    Based in Milford, Maine, Phillips has been making the moose calls, which are hornlike devices used to attract moose when hunting, for about 30 years with a wooden-handled knife his late wife bought him. He has more orders than he can keep up with, due in part to some local media coverage and word-of-mouth. He hopes to pass down his skills to his grown sons.

    Phillips retired 31 years ago from telecommunications jobs with NYMEX and AT&T
    T,
    -0.49%    ,
    and he’s been filling his time with his etching talents ever since.

    “I just can’t imagine being retired with nothing to do. I think I’d go crazy,” Phillips said.

    Plus, in the winter, etching gives him something productive to do to pass time.

    “There’s not a lot you can do outdoors. It gives me something to do rather than just sitting around. Can you imagine doing that for 31 years?” Phillips said.

    Phillips used to make moose calls by peeling a piece of bark off a tree and using it for the day and tossing it aside. Then he started tying spruce roots around the bark to help keep the shape and use it again and again. Hunters started asking for his moose calls and his work spread by word-of-mouth.

    Phillips in a 14-foot birch bark canoe that he built.


    Credit: Butch Phillips

    “Some hunters will use a roadside cone to call a moose. I wanted to do it the traditional way. A large majority of native hunters use a birch bark call,” Phillips said.

    He uses a variety of tools, but the knife given to him by his late wife is his most treasured tool.

    “The blade’s pretty much worn down. But I treasure it. It’s very special,” Phillips said.

    As he became more adept at making moose calls, Phillips started making more permanent models, refining the workmanship and using thicker bark that was suitable for etching.

    “I decided to do etching like they did in the old days. Everything they used to make, they carved. My artwork evolved. I try to keep the older designs alive. I’ve taken symbols like the Wabanaki symbol and incorporated them into the art to keep them alive. I use plants and trees as fillers,” Phillips said.

    “In most of my art work, I try to combine people, plants and animals. We always memorialize our ancestors. And plants and animals are what we owe gratitude to for keeping us alive,” Phillips said. “In our prayers, we always give thanks to ancestors, plants and animals. There’s a theme.”

    Phillips said he writes up explanations of the symbols so each buyer knows what the designs mean. Diamond shapes, for example, represent wigwams, he said. More often these days his buyers are collectors rather than moose hunters.

    Phillips is an expert in his materials.

    “All bark is not created equal. There’s curly bark, thick, thin, white, dark, gray. I use bark that is thick and pliable and doesn’t separate into layers,” Phillips said.

    With winter bark, it’s brown with a thick rind on the inside. He has to take it off the tree carefully and scrape away the rind to make designs. He can approach the etching in two ways – either scraping away the entire background and leaving just a thin image, or carve images onto rind. Summer bark has no rind and is just yellow.

    His museum-quality pieces have used winter bark with an elaborate scraping process that leaves thin details for designs. Those are the toughest to do, he said.

    Phillips approaches each moose call with an open mind and has no preconceived idea of what the designs will be. The bark just speaks to him.

    “I never plan on paper what it’s going to look like. Most of the time I have no idea until it evolves,” Phillips said.

    In the center of the device, he often puts an image of a moose or a moose head. For special orders, he might be asked to incorporate an image of a hawk or favorite dog or even a woodpecker, in one case. He adds touches like a flower, acorns or moose tracks to fill in blank areas.

    “Each side is balanced because nature is balanced,” Phillips said. “Every design is unique.”

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  • Chinese cities announce further easing of COVID curbs, though police are still patrolling streets to stop protests

    Chinese cities announce further easing of COVID curbs, though police are still patrolling streets to stop protests

    Major Chinese cities on Thursday announced a further easing of COVID restrictions, as police continued to patrol streets to avert protests and the ruling Communist Party prepared for the funeral of late leader Jiang Zemin.

    Guangzhou in the south, Shijiazhuang in the north, Chengdu in the southwest and other major cities announced they were easing testing requirements and controls on movement, as the Associated Press reported. In some areas, markets and bus service has reopened.

    In Beijing, officials will let those infected patients who are at low risk to quarantine at home for a week, rather than in a government center, Bloomberg reported, citing unnamed sources.

     China has required anyone with any degree of COVID to stay at those sites to cut transmission. The first signs of the shift have been seen in the heavily populated Chaoyang district, home to foreign embassies and offices.

    Read now: Protests against strict COVID-zero policy are sweeping China but there is no sign yet of a national political movement

    Beijing is hoping to avoid more protests, while resources are also getting thin, those sources said. However, anyone wanting to isolate at home will have to provide a written guarantee to stay at home, with a magnetized alarm fitted on their door that will alert authorized if they try to leave, one source said. Bloomberg was unable to confirm the reports with officials from Beijing or its health department.

    Large protests erupted across China as crowds voiced their frustration at nearly three years of Covid-19 controls. Here’s how a deadly fire in Xinjiang sparked domestic upheaval and a political dilemma for Xi Jinping’s leadership. Photo: Thomas Peter/Reuters

    The World Health Organization’s weekly update shows the global tally of cases was flat in the week through Nov. 27 from the week earlier. The number of fatalities fell by 5% from the previous week.

    Japan again led the world by new cases, with an 18% increase to 698,772. It was followed by South Korea, where cases rose 4% to 378,751 and the U.S., where they rose 8% to 296,882.

    Omicron and its many subvariants and sublineages remained dominant in the period from Oct. 28 to Nov. 28, accounting for 99.9% of sequences reported to a central database. The BA.5 omicron subvariant and its sublineages were dominant in the week through Nov. 13 at 73.% of all sequences, and newer strains, including BQ. 1 and XBB continued to spread in November, the agency said.

    In the U.S., known cases of COVID are rising again with the daily average standing at 45,219 on Wednesday, according to a New York Times tracker, up 15% from two weeks ago. Cases are now rising in 37 states from two weeks ago, as well as in Guam and Washington, D.C., led by Georgia, where they are up 60%, and California, where they have climbed 57%.

    The daily average for hospitalizations was up 16% at 32,445, but again, the pace of the increase is not uniform across the country. Louisiana has the highest increase in hospitalizations at 99% from two weeks ago, followed by California, where they are up 62%.

    The daily average for deaths is down 7% at 262.

    Physicians are reporting high numbers of respiratory illnesses like RSV and the flu earlier than the typical winter peak. WSJ’s Brianna Abbott explains what the early surge means for the coming winter months. Photo illustration: Kaitlyn Wang

    Coronavirus Update: MarketWatch’s daily roundup has been curating and reporting all the latest developments every weekday since the coronavirus pandemic began

    Other COVID-19 news you should know about:

    • Nineteen people, including 17 New York City and New York state public employees, were charged in a federal complaint unsealed Wednesday with submitting fraudulent applications for funds intended to help small businesses survive the coronavirus pandemic, the AP reported. The accused, including employees of New York City’s police department, correction department and public school system, listed themselves as owners of businesses that in some cases did not exist in their applications for funds through the Small Business Administration’s Economic Injury Disaster Loan program and Paycheck Protection Program, federal prosecutors in Manhattan said. The defendants collectively stole more than $1.5 million from the SBA and financial institutions that issued SBA-guaranteed loans, prosecutors said.

    • The number of people in Europe with undiagnosed HIV has risen as testing rates fell during the pandemic, threatening a global goal of ending the disease by 2030, Reuters reported, citing a report from the WHO and European Center for Disease Prevention and Control. The report found that in 2021 a quarter fewer HIV diagnoses were recorded compared to pre-pandemic levels in the WHO’s European region.

    • Republican Gov. Jim Justice said Wednesday that West Virginia’s state of emergency related to the COVID-19 pandemic will end at the start of the new year, the AP reported. The state of emergency has been in effect since March 16, 2020. It allows the governor to suspend certain rules on personnel and purchasing. “The truth is, the state of emergency doesn’t affect a whole lot, you know, anymore,” he said. “We absolutely declared an emergency at a time that we had an emergency. … Now, we need to move on.”

    Here’s what the numbers say:

    The global tally of confirmed cases of COVID-19 topped 643.4 million on Thursday, while the death toll rose above 6.63 million, according to data aggregated by Johns Hopkins University.

    The U.S. leads the world with 98.8 million cases and 1,080,444 fatalities.

    The Centers for Disease Control and Prevention’s tracker shows that 228.4 million people living in the U.S., equal to 68.8% of the total population, are fully vaccinated, meaning they have had their primary shots.

    So far, just 37.6 million Americans have had the updated COVID booster that targets the original virus and the omicron variants, equal to 12.1% of the overall population.

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  • U.S. stocks open mostly higher on key inflation data

    U.S. stocks open mostly higher on key inflation data

    U.S. stock indexes opened mostly higher on Thursday after inflation data closely watched by the Federal Reserve shows price pressures are easing. The personal consumption expenditures index showed the rate of inflation rose 0.3% in October, while the core gauge that strips out volatile food and energy costs, rose 0.2% last month, below the consensus estimate of 0.3% collected from economists by Dow Jones. The S&P 500 rose 0.3%, while the Dow Jones Industrial Average shed 0.2% and the Nasdaq Composite gained 0.4%. The 10-year Treasury yield decreased after the report. Elsewhere, reports suggested China is set to announce an easing of its COVID-19 quarantine protocols in the coming days and a reduction in mass testing.

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  • Okta CEO promises profit for all of next year — ‘The problem was never that we didn’t have talented sales people’

    Okta CEO promises profit for all of next year — ‘The problem was never that we didn’t have talented sales people’

    Okta Inc. executives on Wednesday said they will report an adjusted profit in the fourth quarter and, in a surprise, predicted profitability for all of next fiscal year, trumping profit concerns stemming from recent sales-operation issues.

    For the fourth quarter, Okta
    OKTA,
    +4.04%
    guided for adjusted earnings of 9 cents to 10 cents a share on revenue of $488 million to $490 million. Analysts, on average, were expecting an adjusted loss of 12 cents a share on sales of $488.3 million, according to FactSet.

    In a surprise announcement during the conference call, Chief Financial Officer Brett Tighe revealed a full forecast for fiscal 2024 as well. Most software companies shy away from such practices amid uncertainty about macroeconomic conditions. He said Okta executives are aiming for adjusted profits for the full year on revenue of $2.13 billion to $2.15 billion. Analysts on average expected adjusted losses of 30 cents a share on sales of $2.3 billion, beating profit projections widely but also missing sales expectations by more than $100 million.

    Shares rallied as much as 18% in after-hours trading immediately following the release of the results, but those gains noticeably pared back to a steady 12% level after Tighe announced the outlook to analysts on the call. They have fallen 76% so far this year, compared with a 27% decline by the tech-heavy Nasdaq Composite Index
    COMP,
    +4.41%    .

    In an exclusive interview with MarketWatch ahead of the company’s conference call, Okta Chief Executive and co-founder Todd McKinnon said the company is not providing any forecasts past 2024 because of uncertainty in the macro environment.

    “We’re thinking a pretty conservative assumption that the macro is going to get worse before it gets better, so that’s definitely factored into the guide,” McKinnon told MarketWatch.

    On a more positive note, McKinnon said sales-rep attrition has been the lowest it has been in the past several quarters, following a spike last quarter. Okta also announced that Susan St. Ledger, the president of worldwide field operations, is retiring and McKinnon will take over her duties on an interim basis.

    “What we’ve done over the last six months is what a lot of companies are doing, slowing hiring, re-evaluating real estate, doubling down on the things we know are high value. And some of the things that are maybe less value we’re doing less of, so that’s where we see the profitability come from,” McKinnon told MarketWatch.

    Much of that comes from addressing the company’s struggle in combining Okta’s salesforce with sales reps acquired in the May 2021 acquisition of identity-platform Auth0 (pronounced “Auth Zero”), which is more focused on direct-to-user sales than Okta’s corporate focus.

    “The problem was never that we didn’t have talented sales people,” McKinnon told MarketWatch. “The problem is that we didn’t enable them and clarify things with them.”

    In-depth: Okta CEO says ‘short-term challenges’ resulted in workers leaving at a higher rate

    “We still have work to do,” McKinnon said. “We don’t think we’ve solved it after one quarter of a positive trend but I do think it’s progress.”

    “The biggest factor: We’ve really done a much better job clarifying the products and the positioning and saying we have two clouds: We have Workforce Identity Cloud and Customer Identity Cloud and it’s very clear what to sell when,” he said.

    Okta reported a third-quarter loss of $208.9 million, or $1.32 a share, compared with a loss of $221.3 million, or $1.44 a share, in the year-ago period. After adjusting for stock-based compensation expenses and other items, the company reported break-even results on a per-share basis, compared with a loss of 7 cents a share in the year-ago period. Revenue rose to $481.4 million from $350.7 million in the year-ago quarter.

    Analysts had forecast an adjusted loss of 24 cents a share on revenue of $465.4 million, based on the company’s forecast for a loss of 24 cents to 25 cents a share on sales of $463 million to $465 million.

    For the current year, Okta forecast an adjusted loss of 27 cents to 26 cents a share on revenue of about $1.84 billion, compared with the Street’s forecast of 73 cents a share on revenue of $1.82 billion.

    So far in November, cloud software stocks have been getting trashed. While the S&P 500
    SPX,
    +3.09%
    has gained 5.4%, and the Nasdaq has advanced 4.4%, the iShares Expanded Tech-Software Sector ETF
    IGV,
    +4.39%
    has risen 1.6%, the Global X Cloud Computing ETF
    CLOU,
    +6.00%
    has ticked up 0.8%, the First Trust Cloud Computing ETF
    SKYY,
    +4.54%
    has fallen 2%, and the WisdomTree Cloud Computing Fund
    WCLD,
    +4.99%
    has dropped 6.9%.

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  • The Dow ‘exits’ bear-market territory. Here’s why investors should take it with a grain of salt

    The Dow ‘exits’ bear-market territory. Here’s why investors should take it with a grain of salt

    After outperforming both the S&P 500 and Nasdaq Composite in November, the Dow Jones Industrial Average has exited bear-market territory, based on oft-cited criteria, on the final trading day of the month.

    But before investors get too excited about a new bull market for equities, there’s plenty of reason for caution.

    The Dow
    DJIA,
    +2.18%
    finished Wednesday’s session at its highest closing level since April 21, according to Dow Jones Market Data. Thanks to the gains spurred by Fed Chairman Jerome Powell’s comments at the Brookings Institution, the blue-chip gain has now risen 20.4% from its Sept. 30 closing low, meaning it has technically exited bear-market territory. It’s the only major equity index to do so.

    Typically, when a given index or asset has risen 20% or more off a recent bear-market low, it is said to have technically exited bear-market territory.

    Throughout the history of financial markets, there have been many examples where stocks have rallied during a bear market, only to eventually turn lower and erase all of those gains.

    During drawn-out recessionary bear markets, stocks often rip higher, only to see their gains fizzle again and again. This has already happened more than three times since the start of 2022, including notable counter-rallies that occurred in March, in July and August, and again since mid-October, according to FactSet data.

    Looking further back, market history over the last couple of decades is replete with similar examples, as MarketWatch has reported.

    Following the bursting of the dot-com bubble, the Nasdaq Composite endured at least seven rallies of 20% or more before reaching its ultimate cycle low in 2002.

    Market strategists are especially cautious considering that the Fed still raising interest rates, although Fed Chairman Jerome Powell suggested on Wednesday that senior Fed officials will likely opt for a smaller hike in December after four consecutive 75 basis point hikes — remarks that helped fuel a broad stock-market surge.

    This ultimately underscores a simple point: it’s difficult to say when a bear market has truly ended, since the start of a new bull market is often only crystal-clear in retrospect — not unlike the challenge of determining the start of a recession.

    A similar precept holds true for the economy. While consecutive quarters of contracting gross domestic product are often described as a “technical” recession, this is not the criteria used by the National Bureau of Economic Research when determining whether the U.S. economy is actually in recession or not.

    As the Dow charged higher late last week, one UBS markets strategist warned that investors should anticipate more volatility.

    “We remain skeptical that the recent rally marks the start of a new market regime. The priority of the Fed is likely to remain the fight against inflation, pending a more consistent stream of softer prices and employment data. Against this backdrop, we favor adding to defensive assets in both equity and fixed-income markets,” said Mark Haefele, chief investment officer at UBS Global Wealth Management.

    The blue-chip gauged finished Wednesday’s session at 34,589.77, having risen 737.24 points, or 2.2%. The S&P 500
    SPX,
    +3.09%
    and Nasdaq
    COMP,
    +4.41%
    also recorded strong gains of 3.1% and 4.4%. It was the best session for all three indexes in roughly three weeks.

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  • Salesforce co-CEO Bret Taylor leaving, stock falls after lower-than-expected forecast

    Salesforce co-CEO Bret Taylor leaving, stock falls after lower-than-expected forecast

    Salesforce Inc. performed better than expected in the third quarter, but executives issued a fourth-quarter forecast that fell short of expectations on Wednesday and revealed that co-Chief Executive Bret Taylor is leaving the company.

    Salesforce
    CRM,
    +5.65%
    shares fell about 7% after hours, after rising about 5.5% in the regular session to close at $159.97, their fifth gain in the past six sessions. 

    The cloud-software company said in a news release that founder, co-CEO and Chairman Marc Benioff will resume the sole CEO role on Jan. 31. Taylor is the second executive to be elevated to co-CEO with Benioff, only to leave with Benioff still in charge. Keith Block stepped down in February 2020 after just 18 months in the position, and Taylor lasted exactly a year in the co-CEO position after being promoted Nov. 30 of last year.

    “I am grateful for six fantastic years at Salesforce,” Taylor, who was also vice chairman, said in a statement. “Marc was my mentor well before I joined Salesforce and the opportunity to partner with him to lead the most important software company in the world is career-defining. After a lot of reflection, I’ve decided to return to my entrepreneurial roots.”

    See more: Opinion: Salesforce better get used to Marc Benioff in charge, because he keeps chasing off his chosen successors

    On the company’s earnings call, Benioff said “we’re still in a little bit of shock and extremely sad” about Taylor’s exit, but did not answer an analyst’s question about whether he would fill the co-CEO position.

    At least one analyst said he didn’t see the departure coming: “Given that Mr. Taylor was assumed to be the ‘heir apparent’ at CRM, this does bring up a lot of questions in terms of the management team and frankly offsets some of the positive narrative around margins heading into [calendar year 2023],” wrote Kirk Materne, analyst for Evercore ISI, in a note Wednesday.

    Salesforce reported that third-quarter net income fell to $210 million, or 21 cents a share, compared with $468 million, or 47 cents a share, in the year-ago period. Adjusted for stock-based compensation and other costs, earnings were $1.40 a share. Revenue rose to $7.84 billion from $6.86 billion in the year-ago quarter.

    Analysts, who have been expressing concerns about a slowdown in business-software spending, had forecast adjusted earnings of $1.22 a share on revenue of $7.83 billion, according to FactSet.

    “We remain positive on the long-term outlook for Salesforce as front-office applications leader,” Michael Turits, analyst for KeyBanc Capital Markets, wrote ahead of the company’s earnings report. “That said, we remain cautious regarding the near-term outlook given ongoing recession concerns, slowing cloud spend, and weaker conversations we had with a few Salesforce channels this quarter.”

    Those concerns sprung up in the company’s forecast, as Salesforce executives’ guidance fell $900 million short of expectations. They expect fourth-quarter earnings of 23 cents to 25 cents a share on revenue in the range of $7.932 billion to $8.032 billion, and adjusted earnings of $1.35 to $1.37 a share. Analysts had forecast adjusted earnings of $1.44 a share on revenue of $8.94 billion.

    Chief Financial Officer Amy Weaver said on the earnings call that along with the “unpredictable” macroeconomic environment and some slowing in customer spending, the strong dollar had an impact on the company’s showing. “Foreign exchange continued to be a headwind for our results,” she said.

    Still, Weaver said the company remains committed to a goal of operating margins of 25% or above; in the third quarter it was at 22.7%, which she said was a record high. Among the things the company is doing, she said, is taking a measured approach to hiring. Earlier this month, the company confirmed hundreds of layoffs, though it did not address them during the call.

    See: Tech layoffs approach Great Recession levels

    In response to an analyst’s question about employees working from home and the company’s real-estate footprint, Benioff said the San Francisco-based company will have more employees in the office while maintaining the flexibility of remote work. “We’re never going back to how it was, we all know that,” he said. Meanwhile, Weaver said the company is “looking at every aspect of our real estate .”

    Shares of Salesforce have declined about 37% this year. The Dow Jones Industrial Average
    DJIA,
    +2.18%    ,
    whose 30 components include Salesforce, has fallen about 5% year to date, while the S&P 500 index
    SPX,
    +3.09%
    is down almost 15% this year.

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  • XPeng stock rockets toward record rally as bulls brush off bad results, outlook

    XPeng stock rockets toward record rally as bulls brush off bad results, outlook

    The U.S.-listed shares of China-based electric vehicle maker XPeng Inc. skyrocketed Wednesday, as investors cheered changes in China’s COVID policy while shrugging off weak third-quarter results and a downbeat outlook.

    The stock
    XPEV,
    +45.44%
    charged up 45.0% in midday trading, enough to pace all gainers on the New York Stock Exchange. It was also headed for the biggest one-day gain since going public in August 2020, surpassing the previous record advance of 33.9% on Nov. 23, 2020.

    The rally comes even after XPeng reported a wider-than-expected loss for the third-straight quarter, missed on revenue for the first time and said it expected fourth-quarter revenue to fall 40% to 44% from a year ago while the FactSet consensus called for just a 4.4 decline.

    Instead, investors seemed China appeared to move toward easing its zero-COVID policy, amid growing social unrest and a slowing economy. China’s government said Tuesday that it would renew its push to vaccinate the elderly, and said it would amend COVID control measures.

    XPeng’s stock rally also comes at a time when investor sentiment had soured. Earlier this week, Jefferies analyst Johnson Wan downgraded the EV maker, citing recent “missteps” by the company at a time that the “honeymoon stage” for EVs in China was coming to an end.

    In addition, short interest, or bearish bets on XPeng’s stock, was 5.7% of the public float, or freely tradable shares, based on the latest available exchange data. That compares with short interest as a percent of float for China-based rivals Nio Inc.
    NIO,
    +20.14%
    at 4.1% and Li Auto Inc.
    LI,
    +18.35%
    at 4.7%.

    For Tesla Inc.
    TSLA,
    +2.12%    ,
    which generated $5.13 billion in revenue from China in its latest quarter, or about 24% of total revenue, short interest as a percent of float was 2.9%.

    XPeng’s stock has soared 60.7% in November but has still tumbled 41.7% over the past three months. In comparison, the Invesco Golden Dragon China exchange-traded fund
    PGJ,
    +8.98%
    has shed 11.7% the past three months while the S&P 500 index
    SPX,
    +0.62%
    has slipped 1.1%.

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