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Tag: Retail

  • $3,000 gold and more outrageous market predictions investors shouldn’t brush aside.

    $3,000 gold and more outrageous market predictions investors shouldn’t brush aside.

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    Monday served as another smackdown for investors who are banking on a Goldilocks economy and a less aggressive Fed.

    Some are now not ruling out a Grinch-like turn from the central bank — a 0.75% hike next week instead of the 0.50% markets have been pinning hopes on — following strong data on services, jobs and wages.

    It all goes along with the theme of 2022 — expect the unexpected. The relief of moving out of a crippling pandemic was quickly replaced by the biggest war on Europe’s shores in decades, that sparked worldwide inflation surges.

    What comes next is anyone’s guess and that brings us to our call of the day via Saxo Bank’s annual “Outrageous Predictions” for 2023.

    While some of these will sound crazy, note that the Saxo team, led by Chief Investment Officer Steen Jakobsen, have nailed a few wild prophecies in the past decade. Those include: a Brexit prediction in 2015, a 25% drop for the S&P 500 from its 2007 high in 2008, a tripling of Bitcoin’s value forecast in 2017.

    The focus for 2023’s prediction is that “a return to the disinflationary prepandemic dynamic is impossible because we have entered into a global war economy, with every major power across the world now scrambling to shore up their national security on all fronts; whether in an actual military sense, or due to profound supply-chain, energy and even financial insecurities that have been laid bare by the pandemic experience and Russia’s invasion of Ukraine,” says Jakobsen.

    As for those predictions, here we go:

    • Gold crosses $2,075 then rockets to $3,000 on unstoppable inflation. “Fed policy tightening and quantitative tightening drives a new snag in U.S. treasury markets that forces new sneaky ‘measures’ to contain Treasury market volatility that really amounts to new de facto quantitative easing,” says Saxo. And China’s end of zero-COVID drives up demand, commodity prices and inflation.

    • Widespread price controls to cap official inflation due to war economy mentality. “In 2023, expect broadening price and even wage controls, maybe even something like a new National Board for Prices and Incomes being established in the U.K. and the U.S.,” said Saxo. Market fallout? Fuel for gold’s
      GC00,
      +0.19%

      climb.

    • There’s a new reserve asset in town. Non U.S.-allied countries move away from the U.S. and IMF to create an “international clearing union (ICU) and a new reserve asset, called the Bancor (currency code KEY)” that borrows from economist John Maynard Keynes idea of resisting U.S. power over the international monetary system. Nonaligned central banks slash U.S. dollar reserves, Treasury yields soar and the dollar
      DXY,
      +0.09%

      drops 25% against a basket of currencies that trade with Bancor.

    • Japan pegs USDJPY to 200. Pressure intensifies on the already weak yen
      USDJPY,
      +0.04%

      into 2023 as currency intervention fails and inflation soars. The government resets the financial system, erasing all debt, recapitalizing banks, as trillions of yen return to Japan shores. But the yen still weakens by year-end.

    • A $10 trillion-dollar Manhattan project. A team of major tech leaders form a mega research-and-development effort for energy infrastructure and ground-breaking technologies — the Third Stone. Companies tied to the project soar in an overall weak environment for investing.

    • Tax haven ban kills private equity. The OECD launches a full ban on the biggest tax havens in the world in 2023 and in the U.S., carried interest tax as capital gains is shifted to ordinary income. It’s a body blow for private equity and venture capital — the valuation of publicly listed private-equity firms fall 50%.

    The rest of their predictions are here, such as the formation of an EU Armed Forces in 2023 and an “UnBrexit” referendum.

    Read: Why Monday’s stock-market rout should be a wake up call for investors

    The markets

    MarketWatch

    Stocks
    DJIA,
    -0.96%

     
    SPX,
    -1.40%

     
    COMP,
    -1.77%

    are drifting into the red, with Treasury yields
    TMUBMUSD10Y,
    3.571%

     
    TMUBMUSD02Y,
    4.395%

    steady, the dollar
    DXY,
    +0.09%

    lower and oil
    CL.1,
    -3.43%

     
    BRN00,
    -3.73%

    also down.

    For more market updates plus actionable trade ideas for stocks, options and crypto, subscribe to MarketDiem by Investor’s Business Daily.

    The buzz

    BioVie stock
    BIVI,
    -18.43%

    is climbing after positive results from the clinical-stage biopharmaceutical company on a drug for Parkinson’s and Alzheimer’s.

    NRG Energy
    NRG,
    -15.79%

    agreed to buy Vivint Smart Home
    VVNT,
    +32.31%

    in a $5.2 billion deal. Vivint shares are soaring.

    MEI Pharma
    MEIP,
    -33.52%

    shares are tumbing after drugmaker said it would stop developing cancer treatment zandelisib outside of Japan and announces job cuts. Herbalife shares
    HLF,
    -18.85%

    are down 10% after an offering of convertible notes 

    Powell Industries
    POWL,
    +19.11%

    stock is up 9% after the electrical equipment maker’s well-received results and new orders. Within software Sumo Logic
    SUMO,
    +11.65%

    and GitLab shares
    GTLB,
    +5.71%

    are surging on upbeat results and forecasts.

    Layoffs extending beyond tech? PepsiCo 
    PEP,
    -0.86%

    is reportedly cutting hundreds of workers at its North American headquarters.

    Home builder Toll Brothers
    TOL,
    -1.56%

    will report results after the close.

    The October trade deficit jumped 5.4% to $78,2 billion.

    The U.S. and EU are reportedly considering fresh steel and aluminum tariffs on China to fight carbon emissions.

    Best of the web

    “Nothing to be glad about.” An empty, lonely and cold formerly occupied Ukraine city.

    Morocco’s World Cup team leans on its secret weapon of parents in the stands.

    Why human composting could be the next big thing.

    The chart

    Headed into the holidays, consumers are using savings and credit, says a team of Jefferies analysts led by Corey Tarlowe. “The savings rate continues to trend lower and credit card balances are growing +15% Y/Y. We believe these trends indicate that the consumer is stretched.”

    Against this backdrop, they like Costco
    COST,
    -1.34%
    ,
    Dollar General
    DG,
    -1.52%
    ,
    Target
    TGT,
    +0.13%

    and Walmart
    WMT,
    -0.98%
    .


    FactSet/Jefferies

    The tickers

    These were the top-searched tickers on MarketWatch at 6 a.m.:

    Ticker

    Security name

    TSLA,
    -2.00%
    Tesla

    GME,
    -5.32%
    GameStop

    AMC,
    -9.00%
    AMC Entertainment

    NIO,
    +2.37%
    NIO

    BBBY,
    -8.86%
    Bed Bath & Beyond

    AAPL,
    -1.83%
    Apple

    APE,
    -5.40%
    AMC Entertainment Holdings preferred shares

    COSM,
    -17.49%
    Cosmos

    AMZN,
    -2.26%
    Amazon.com

    MULN,
    -3.08%
    Mullen Automotive

    Random reads

    Tributes pour after “Cheers” star Kirstie Alley dies at 71.

    Happy 190th birthday to the world’s oldest tortoise.

    A green Grinchy dog for Christmas? Not everyone’s heart grew three sizes.

    Need to Know starts early and is updated until the opening bell, but sign up here to get it delivered once to your email box. The emailed version will be sent out at about 7:30 a.m. Eastern.

    Listen to the Best New Ideas in Money podcast with MarketWatch reporter Charles Passy and economist Stephanie Kelton

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  • Must Read: Malone Souliers Launches ‘Emily in Paris’ Shoe Collection, How Resale Saved New York Retail

    Must Read: Malone Souliers Launches ‘Emily in Paris’ Shoe Collection, How Resale Saved New York Retail

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    These are the stories making headlines in fashion on Monday.

    Malone Souliers launches “Emily in Paris” shoe collection
    In anticipation of the third season of “Emily in Paris,” Malone Souliers teamed up with the show for a “très chic” shoe collaboration. The collection boasts 11 new styles in a variety of colorways inspired by the characters of the show, including The Emily, The Camille and The Gabriel. “Like everyone else, I became obsessed with ‘Emily in Paris’ when it first aired in 2020,” Mary Alice, the brand’s creative director, said in a statement. “The witty humor is what first drew me in, but then I couldn’t take my eyes off the outfits. I knew it would be the perfect show for Malone Souliers to collaborate with.” The collection is available to shop Dec. 6 at the brand’s Mount Street flagship store and online at MaloneSouliers.com. {Fashionista inbox}

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    Brooke Frischer

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  • The Era of Digital Product Tags Is Nigh

    The Era of Digital Product Tags Is Nigh

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    In late May, Amazon opened its first clothing store in a sprawling suburban mall outside Los Angeles. Like most physical retailers these days, Amazon Style, as it’s called, aims to bring a little something extra to the brick-and-mortar experience, as some might do with plush coffee bars or rotating art installations.

    Amazon Style, though, has technology. Each clothing tag comes equipped with a QR code shoppers can scan to see more details about the garment, like sizing, colors and customer ratings. Rather than wrangle an armful of jeans into a fitting room, customers can curate a list of pieces the’d like to try on or rather purchase directly. Clothes bought online can be shipped in-store, where shoppers can try them on and begin the process over again. 

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    Maura Brannigan

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  • Apple, Alibaba, NIO, and More Stock Market Movers Monday

    Apple, Alibaba, NIO, and More Stock Market Movers Monday

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    Stock futures traded lower Monday as investors remained keyed on interest rate policy from the Federal Reserve and as a surge in China stocks over a loosening of Covid-19 restrictions in the country failed to boost U.S. equities.

    Here are some stocks that could make moves Monday:

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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

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    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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  • 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

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    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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  • Kidsy Expands Its Online Marketplace of Secondhand Baby and Kids Products Ahead of Holiday Gift Season

    Kidsy Expands Its Online Marketplace of Secondhand Baby and Kids Products Ahead of Holiday Gift Season

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    The gently used and open box children’s goods reseller launches over 7,000 items for sale, including clothes, furniture, and toys, providing affordable options to combat inflation concerns.

    Press Release


    Dec 1, 2022 13:03 EST

    Kidsy, an online marketplace for parents to buy and sell gently used kids’ items across all categories in the U.S., announces a major growth milestone, with over 7,000 products now for sale since its April 2022 launch. This milestone makes Kidsy one of the fastest-growing resellers for products in its category, indicative of a rapidly growing secondhand shopping market as parents seek out cost-effective options as inflation hits a 40-year high.

    The U.S. secondhand baby and kids products market is expected to reach $12.8 billion by 2030, driven by advancements in technology and a surge in popularity of secondhand marketplaces.

    “Over the past few years, I’ve witnessed a seismic shift among my peers in the way they shop,” said Shraysi Tandon, CEO and co-founder of Kidsy. “Gone are the days of clamoring for every item from the hottest new designer collection; that seems so passé today. Parents are now showing off their secondhand purchases and building closets and nurseries out of their lucky finds. There’s an appreciation for the nostalgia and history attached to secondhand goods. It’s so much more enchanting.”

    Kidsy offers a wide selection of products by eliminating the geographic limitations of a social media marketplace or a local secondhand store. Users can browse through items, including clothes, toys, books, bath items, diapering, travel gear and nursery essentials, and filter their search to find what they are looking for from sellers across the U.S. They are able to message sellers directly, ask questions about an item and even make them an offer, all through the Kidsy platform.

    “At Kidsy, we believe the closets and nurseries of the future are circular. The rapid growth of Kidsy is testament to the boom of secondhand shopping, and we expect this trend to continue as more people recognize resale as a powerful solution to wastefulness, not to mention a solution to high prices and inflation,” said Sinan Sari, co-founder and CTO of Kidsy. “With the holiday season here, we’re excited to provide a resource for parents to find affordable options during an often cash-strapped time of year, and resell some of the gently used items they no longer have a use for.”

    For the holiday season, Kidsy is offering all customers a $5 coupon redeemable on the Kidsy marketplace between now and Dec. 31, 2022. To take advantage of the promotion, use HOLIDAY5 at checkout. 

    Kidsy’s parenting blog, answering Google’s most frequently asked questions about kids, from feeding and sleep training to educational activities, is now live. 

    For the latest news and information on Kidsy’s growing online marketplace, visit our website at https://www.kidsy.co/ and follow us on Instagram, Facebook and Twitter.

    About Kidsy

    Kidsy is an online marketplace for parents to buy and sell gently used and open box kids’ items, across all categories, nationally. It is co-founded by journalist Shraysi Tandon and software engineer Sinan Sari, born out of a pain point to solve the issue of finding an affordable and reliable source of secondhand kids’ items off of social media platforms. Kidsy launched in April 2022 and has already collected over 7,000 baby and kids items for sale, unlocking access to thousands of children’s wardrobes and nurseries across the country and giving parents more choice and affordability when it comes to buying secondhand.

    Source: Kidsy

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  • The First Connected Social Commerce Platform to Bring TikTok, Instagram and YouTube Feeds into a One-Stop Real-Time Social Shop

    The First Connected Social Commerce Platform to Bring TikTok, Instagram and YouTube Feeds into a One-Stop Real-Time Social Shop

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    Motom, the app simplifying the social shopping experience for both creators and consumers is officially offering 15% cash back this holiday season.

    Press Release


    Nov 30, 2022 07:42 EST

    The rapidly growing social commerce platform is backed by a team of retail innovators that allows creators and consumers to shop the direct feeds of thousands of creators across TikTok, Instagram, and YouTube. Pushing innovation forward in the category that includes veterans such as liketoknow.it and Rakuten, Motom (https://www.motom.me/) differentiates itself by fundamentally changing the way consumers can shop across the entire social media ecosystem and providing all creators and brands with an easy-to-use, scalable way to increase their revenue and grow their audiences.

    This holiday season, Motom is extending its affiliate fees and discounts to 15% for all consumers and creators. Whether creating LikeBoard gift guides, posting shopping lists, or your own curated lists directly to your storefront, Motom will give you cash back as you shop for your family, friends, colleagues, and even yourself. Whether you’re a creator with millions of followers or a consumer who wants all your favorite items in one place, Motom’s cash-back holiday program is for everyone. 

    “As an open social shopping platform, we’re excited to offer all creators the highest commission percentages while giving them access to thousands of brands and a robust social shopping community to boost both their sales and audience,” said Matt Diamond, CEO of Motom. “For the holidays this year, we’re giving back to our entire community by offering everyone the opportunity to earn 15% cash back when they do their holiday shopping directly on Motom.”

    To find out more about Motom’s holiday program, please check it out here. For inspiration, check out all of the holiday creator gift guides on Motom’s LikeBoard feed as you shop. There is everything from “Under $50,” “Gifts for Fashion Girlies,” “Best TikTok products for your BFF,” to “Coquette Looks for the Holiday,” “Gifts for Wellness Lifestyle,” “Stocking Stuffers,” and more.

    About Motom

    Motom is the first connected social shopping platform that empowers all creators to launch their own storefronts where all their content from TikTok, Instagram, and YouTube can be made shoppable in one place. Creators sell, connect, and share intimately with their audience while earning more from their content using Motom’s tools and gaining access to 250K+ monthly social shoppers. Motom’s platform neutrality and exclusive shopping focus will fundamentally change the way consumers can shop across the entire social ecosystem, expand opportunities for all creators, and enable brands and retailers to lower customer acquisition costs.

    Motom was founded by the team who successfully launched some of the largest youth properties in the past 20 years, including Alloy and Delia’s e-commerce and media businesses and entertainment properties, including Gossip Girl, Pretty Little Liars, and The Sisterhood of the Traveling Pants. For all media inquiries, please contact Collxab at Motom@CollXab.com.

    Source: Motom

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  • EU sets out plan to cut back packaging waste

    EU sets out plan to cut back packaging waste

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    Say goodbye to mini shampoo bottles.

    The EU wants to slash the amount of packaging waste produced across the bloc, banning everything from mini hotel toiletries to throwaway plastic wrapping around some fresh fruit and vegetables.

    The proposal is part of the European Commission’s circular economy package, legislation aimed at slashing waste and reducing emissions to help the bloc reach climate neutrality by 2050.

    The new rules include mandatory targets for the amount of recycled materials used in plastic packaging and pushes cafés, shops and hotels to switch to reusable, rather than single-use packaging. It calls for all packaging on the EU market to be recyclable by 2030.

    Countries will also be told to set up schemes to increase recycling of bottles and cans: Customers would pay a small additional sum on top of their purchase, which is refunded on the bottle’s return.

    Packaging is a “key environmental concern,” the Commission said in its preamble to the new rules. The sector is one of the “main users of virgin materials,” hoovering up 40 percent of plastics and 50 percent of paper, and accounting for 36 percent of municipal solid waste.

    In 2020, every EU resident generated nearly 180 kilograms of waste, according to new EU data. Paper and cardboard are the main culprit, accounting for 32.7 million tons in 2020, followed by plastic and glass at about 15 million tons each.

    “Without action, the EU would see a further 19 percent increase in packaging waste by 2030, and for plastic packaging waste even a 46 percent increase,” according to the Commission.

    But its proposal isn’t going down particularly well. Industry groups have pushed back hard against higher reuse targets in recent weeks, while NGOs are accusing the Commission of bowing to those demands and watering down its proposal.

    Here are four key points of contention.

    End of single-use

    One key element of the Commission’s proposal is a ban on some types of single-use packaging in the hospitality sector — such as disposable plates and cups, sugar packets and other condiments, or mini soaps and shampoos.

    Businesses won’t let that happen without a fight.

    Ever since a first draft of the new rules leaked last month, they’ve been hammering home the argument that the energy and water needed to clean the reusable packaging would outweigh the environmental benefits of moving away from single-use items.

    A ban would “require a full cost analysis of businesses in particular energy, water and operational costs,” hospitality lobby HOTREC argued in an emailed statement, adding that the cost of those assessments shouldn’t fall to the businesses.

    The rules also set targets for companies to ensure a certain quantity of products are provided in reusable or refillable packaging. For example, 20 percent of takeaway beverage sales made by a café must be served in reusable packaging or using customers’ own containers by 2030, with the target ramping up to 80 percent in 2040. Beer retailers will have to sell 10 percent of their products in refillable bottles by 2030 and 20 percent by 2040.

    That’s another sore point for industry.

    The Commission should “look at the full life cycle impact of all packaging products,” according to the European Paper Packaging Alliance lobby. It argues that “scientific evidence shows that recyclable, single-use, paper-based packaging has a lower environmental impact than reusable systems, in takeaway settings as well as in quick service restaurants.”

    Recycling concerns

    Industry groups also complain that the proposal unfairly favors reusable packaging over recyclable single-use packaging, meaning wasted money on investments in recycling facilities — even though the text seeks to boost recycling in the bloc. There’s a minimum amount of recycled content that must be used in the manufacturing of certain plastic packaging, for example.

    “There’s a real concern for the industry — we don’t know which horse to back now, because the policy itself has conflicting goals,” said Ian Ellington, senior vice president at Pepsico and president of EU soft drinks lobby UNESDA. “I think the likely outcome of that is we would pause some of those investments while we figure out what the regulatory framework is really going to be.”

    Brussels seems to have listened: The rules proposed on Wednesday lay down lower targets on what percentage of packaging must be reusable.

    But now environmental groups are sounding the alarm, saying the EU needs to focus on boosting reusable packaging rather than relying on recycling as the solution.

    Campaigners have argued that positive messaging around recycling could be promoting additional consumption — and additional waste. They also point out that the average recycling rate is only 64.4 percent.

    In rowing back the reuse targets in its current proposal, the EU executive “seems to have fallen into industry’s false promises on investments on recycling,” Larissa Copello, a policy officer for Zero Waste Europe said in an emailed statement.

    Death of marketing

    The Commission’s proposal would also ban “superfluous” packaging, like double walls or false bottoms aimed at making products appear to contain more than they do.

    That essentially means all packaging should be designed for functionality and to minimize the amount of packaging used.

    The idea isn’t going down well with businesses that use distinctive packaging to stand out, such as spirits and perfume manufacturers.

    In a letter to the Commission, several lobbies argued the new rules will lead to “standardisation of packaging and have negative competitive repercussions for EU consumers, brands and industry.”

    “An awful lot of work goes into presenting your products to the market,” said Adeline Farrelly, secretary-general of the association of European manufacturers of glass containers. “The image of your product, the way it looks and feels is a huge part of the value added product.”

    Biodegradable packaging in the crosshairs

    Compostable and bio-based packaging manufacturers will also have to abide by new rules, as such products can jam up recycling processes and take a long time to fully biodegrade in certain environments.

    The Commission has designated a “very small list of products” that should be designed for composting — tea bags, filter coffee pods, sticky labels attached to fruit and vegetables, and lightweight plastic carrier bags — while the rest should go into recycling.

    The compostable packaging industry isn’t happy about that, saying it will seriously hamper their business.

    The new rules are still “effectively … a ban, or sort of very tight control of what can be composted and what can’t,” said Jack McKeivor, the director of public affairs for compostable packaging company TIPA.

    “Why would investors want to invest in it? Why would customers want to buy this stuff if they can’t use it for its originally designated purpose?” he added.

    The move would jeopardize the EU’s “current leadership role in the sector” and “freeze” further research and investments into such products, a coalition of bioplastic companies wrote in a letter.

    The Commission’s proposal will now be examined by the European Parliament and EU countries, but faces a rocky road ahead — a number of MEPs have already sent a letter to the Commission echoing industry concerns.

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    Leonie Cater

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  • 20 dividend stocks with high yields that have become more attractive right now

    20 dividend stocks with high yields that have become more attractive right now

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    Income-seeking investors are looking at an opportunity to scoop up shares of real estate investment trusts. Stocks in that asset class have become more attractive as prices have fallen and cash flow is improving.

    Below is a broad screen of REITs that have high dividend yields and are also expected to generate enough excess cash in 2023 to enable increases in dividend payouts.

    REIT prices may turn a corner in 2023

    REITs distribute most of their income to shareholders to maintain their tax-advantaged status. But the group is cyclical, with pressure on share prices when interest rates rise, as they have this year at an unprecedented scale. A slowing growth rate for the group may have also placed a drag on the stocks.

    And now, with talk that the Federal Reserve may begin to temper its cycle of interest-rate increases, we may be nearing the time when REIT prices rise in anticipation of an eventual decline in interest rates. The market always looks ahead, which means long-term investors who have been waiting on the sidelines to buy higher-yielding income-oriented investments may have to make a move soon.

    During an interview on Nov 28, James Bullard, president of the Federal Reserve Bank of St. Louis and a member of the Federal Open Market Committee, discussed the central bank’s cycle of interest-rate increases meant to reduce inflation.

    When asked about the potential timing of the Fed’s “terminal rate” (the peak federal funds rate for this cycle), Bullard said: “Generally speaking, I have advocated that sooner is better, that you do want to get to the right level of the policy rate for the current data and the current situation.”

    Fed’s Bullard says in MarketWatch interview that markets are underpricing the chance of still-higher rates

    In August we published this guide to investing in REITs for income. Since the data for that article was pulled on Aug. 24, the S&P 500
    SPX,
    -0.29%

    has declined 4% (despite a 10% rally from its 2022 closing low on Oct. 12), but the benchmark index’s real estate sector has declined 13%.

    REITs can be placed broadly into two categories. Mortgage REITs lend money to commercial or residential borrowers and/or invest in mortgage-backed securities, while equity REITs own property and lease it out.

    The pressure on share prices can be greater for mortgage REITs, because the mortgage-lending business slows as interest rates rise. In this article we are focusing on equity REITs.

    Industry numbers

    The National Association of Real Estate Investment Trusts (Nareit) reported that third-quarter funds from operations (FFO) for U.S.-listed equity REITs were up 14% from a year earlier. To put that number in context, the year-over-year growth rate of quarterly FFO has been slowing — it was 35% a year ago. And the third-quarter FFO increase compares to a 23% increase in earnings per share for the S&P 500 from a year earlier, according to FactSet.

    The NAREIT report breaks out numbers for 12 categories of equity REITs, and there is great variance in the growth numbers, as you can see here.

    FFO is a non-GAAP measure that is commonly used to gauge REITs’ capacity for paying dividends. It adds amortization and depreciation (noncash items) back to earnings, while excluding gains on the sale of property. Adjusted funds from operations (AFFO) goes further, netting out expected capital expenditures to maintain the quality of property investments.

    The slowing FFO growth numbers point to the importance of looking at REITs individually, to see if expected cash flow is sufficient to cover dividend payments.

    Screen of high-yielding equity REITs

    For 2022 through Nov. 28, the S&P 500 has declined 17%, while the real estate sector has fallen 27%, excluding dividends.

    Over the very long term, through interest-rate cycles and the liquidity-driven bull market that ended this year, equity REITs have fared well, with an average annual return of 9.3% for 20 years, compared to an average return of 9.6% for the S&P 500, both with dividends reinvested, according to FactSet.

    This performance might surprise some investors, when considering the REITs’ income focus and the S&P 500’s heavy weighting for rapidly growing technology companies.

    For a broad screen of equity REITs, we began with the Russell 3000 Index
    RUA,
    -0.04%
    ,
    which represents 98% of U.S. companies by market capitalization.

    We then narrowed the list to 119 equity REITs that are followed by at least five analysts covered by FactSet for which AFFO estimates are available.

    If we divide the expected 2023 AFFO by the current share price, we have an estimated AFFO yield, which can be compared with the current dividend yield to see if there is expected “headroom” for dividend increases.

    For example, if we look at Vornado Realty Trust
    VNO,
    +1.03%
    ,
    the current dividend yield is 8.56%. Based on the consensus 2023 AFFO estimate among analysts polled by FactSet, the expected AFFO yield is only 7.25%. This doesn’t mean that Vornado will cut its dividend and it doesn’t even mean the company won’t raise its payout next year. But it might make it less likely to do so.

    Among the 119 equity REITs, 104 have expected 2023 AFFO headroom of at least 1.00%.

    Here are the 20 equity REITs from our screen with the highest current dividend yields that have at least 1% expected AFFO headroom:

    Company

    Ticker

    Dividend yield

    Estimated 2023 AFFO yield

    Estimated “headroom”

    Market cap. ($mil)

    Main concentration

    Brandywine Realty Trust

    BDN,
    +2.12%
    11.52%

    12.82%

    1.30%

    $1,132

    Offices

    Sabra Health Care REIT Inc.

    SBRA,
    +2.41%
    9.70%

    12.04%

    2.34%

    $2,857

    Health care

    Medical Properties Trust Inc.

    MPW,
    +2.53%
    9.18%

    11.46%

    2.29%

    $7,559

    Health care

    SL Green Realty Corp.

    SLG,
    +2.25%
    9.16%

    10.43%

    1.28%

    $2,619

    Offices

    Hudson Pacific Properties Inc.

    HPP,
    +1.41%
    9.12%

    12.69%

    3.57%

    $1,546

    Offices

    Omega Healthcare Investors Inc.

    OHI,
    +1.23%
    9.05%

    10.13%

    1.08%

    $6,936

    Health care

    Global Medical REIT Inc.

    GMRE,
    +2.55%
    8.75%

    10.59%

    1.84%

    $629

    Health care

    Uniti Group Inc.

    UNIT,
    +0.55%
    8.30%

    25.00%

    16.70%

    $1,715

    Communications infrastructure

    EPR Properties

    EPR,
    +0.86%
    8.19%

    12.24%

    4.05%

    $3,023

    Leisure properties

    CTO Realty Growth Inc.

    CTO,
    +2.22%
    7.51%

    9.34%

    1.83%

    $381

    Retail

    Highwoods Properties Inc.

    HIW,
    +0.99%
    6.95%

    8.82%

    1.86%

    $3,025

    Offices

    National Health Investors Inc.

    NHI,
    +2.59%
    6.75%

    8.32%

    1.57%

    $2,313

    Senior housing

    Douglas Emmett Inc.

    DEI,
    +0.87%
    6.74%

    10.30%

    3.55%

    $2,920

    Offices

    Outfront Media Inc.

    OUT,
    +0.89%
    6.68%

    11.74%

    5.06%

    $2,950

    Billboards

    Spirit Realty Capital Inc.

    SRC,
    +1.15%
    6.62%

    9.07%

    2.45%

    $5,595

    Retail

    Broadstone Net Lease Inc.

    BNL,
    -0.30%
    6.61%

    8.70%

    2.08%

    $2,879

    Industial

    Armada Hoffler Properties Inc.

    AHH,
    +0.00%
    6.38%

    7.78%

    1.41%

    $807

    Offices

    Innovative Industrial Properties Inc.

    IIPR,
    +1.42%
    6.24%

    7.53%

    1.29%

    $3,226

    Health care

    Simon Property Group Inc.

    SPG,
    +1.03%
    6.22%

    9.55%

    3.33%

    $37,847

    Retail

    LTC Properties Inc.

    LTC,
    +1.42%
    5.99%

    7.60%

    1.60%

    $1,541

    Senior housing

    Source: FactSet

    Click on the tickers for more about each company. You should read Tomi Kilgore’s detailed guide to the wealth of information for free on the MarketWatch quote page.

    The list includes each REIT’s main property investment type. However, many REITs are highly diversified. The simplified categories on the table may not cover all of their investment properties.

    Knowing what a REIT invests in is part of the research you should do on your own before buying any individual stock. For arbitrary examples, some investors may wish to steer clear of exposure to certain areas of retail or hotels, or they may favor health-care properties.

    Largest REITs

    Several of the REITs that passed the screen have relatively small market capitalizations. You might be curious to see how the most widely held REITs fared in the screen. So here’s another list of the 20 largest U.S. REITs among the 119 that passed the first cut, sorted by market cap as of Nov. 28:

    Company

    Ticker

    Dividend yield

    Estimated 2023 AFFO yield

    Estimated “headroom”

    Market cap. ($mil)

    Main concentration

    Prologis Inc.

    PLD,
    +1.63%
    2.84%

    4.36%

    1.52%

    $102,886

    Warehouses and logistics

    American Tower Corp.

    AMT,
    +0.75%
    2.66%

    4.82%

    2.16%

    $99,593

    Communications infrastructure

    Equinix Inc.

    EQIX,
    +0.80%
    1.87%

    4.79%

    2.91%

    $61,317

    Data centers

    Crown Castle Inc.

    CCI,
    +0.93%
    4.55%

    5.42%

    0.86%

    $59,553

    Wireless Infrastructure

    Public Storage

    PSA,
    +0.19%
    2.77%

    5.35%

    2.57%

    $50,680

    Self-storage

    Realty Income Corp.

    O,
    +0.72%
    4.82%

    6.46%

    1.64%

    $38,720

    Retail

    Simon Property Group Inc.

    SPG,
    +1.03%
    6.22%

    9.55%

    3.33%

    $37,847

    Retail

    VICI Properties Inc.

    VICI,
    +0.81%
    4.69%

    6.21%

    1.52%

    $32,013

    Leisure properties

    SBA Communications Corp. Class A

    SBAC,
    +0.27%
    0.97%

    4.33%

    3.36%

    $31,662

    Communications infrastructure

    Welltower Inc.

    WELL,
    +3.06%
    3.66%

    4.76%

    1.10%

    $31,489

    Health care

    Digital Realty Trust Inc.

    DLR,
    +0.63%
    4.54%

    6.18%

    1.64%

    $30,903

    Data centers

    Alexandria Real Estate Equities Inc.

    ARE,
    +1.49%
    3.17%

    4.87%

    1.70%

    $24,451

    Offices

    AvalonBay Communities Inc.

    AVB,
    +0.98%
    3.78%

    5.69%

    1.90%

    $23,513

    Multifamily residential

    Equity Residential

    EQR,
    +1.46%
    4.02%

    5.36%

    1.34%

    $23,503

    Multifamily residential

    Extra Space Storage Inc.

    EXR,
    +0.31%
    3.93%

    5.83%

    1.90%

    $20,430

    Self-storage

    Invitation Homes Inc.

    INVH,
    +2.15%
    2.84%

    5.12%

    2.28%

    $18,948

    Single-family residental

    Mid-America Apartment Communities Inc.

    MAA,
    +1.83%
    3.16%

    5.18%

    2.02%

    $18,260

    Multifamily residential

    Ventas Inc.

    VTR,
    +2.22%
    4.07%

    5.95%

    1.88%

    $17,660

    Senior housing

    Sun Communities Inc.

    SUI,
    +2.12%
    2.51%

    4.81%

    2.30%

    $17,346

    Multifamily residential

    Source: FactSet

    Simon Property Group Inc.
    SPG,
    +1.03%

    is the only REIT to make both lists.

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  • IMF head joins chorus calling on China to adapt COVID strategy as officials pledge to boost vaccinations among elderly

    IMF head joins chorus calling on China to adapt COVID strategy as officials pledge to boost vaccinations among elderly

    [ad_1]

    The head of the International Monetary Fund on Tuesday joined the chorus of people urging China to adopt a more targeted approach to the coronavirus pandemic as the country’s zero-COVID policy sparks protests over lockdowns and hobbles the world’s second-biggest economy.

    IMF Managing Director Kristalina Georgieva urged a “recalibration” of China’s tough “zero-COVID” approach, which is aimed at isolating every case, “exactly because of the impact it has on both people and on the economy,” as the Associated Press reported.

    See also: Some markets cheer as China vows to vaccinate more elderly. Analysts see positive movement by officials.

    Georgieva made the comments in an interview with the AP on Tuesday, after protests erupted in Chinese cities and in Hong Kong over the weekend, marking the strongest public dissent in decades.

    “We see the importance of moving away from massive lockdowns, being very targeted in restrictions,” Georgieva said Tuesday in Berlin. “So that targeting allows [China] to contain the spread of COVID without significant economic costs.”

    Georgieva also urged China to look at vaccination policies and focus on vaccinating the “most vulnerable people.”

    A low rate of vaccinations among the elderly is a major reason Beijing has had to resort to lockdowns, while the emergence of more-contagious variants has made it increasingly hard to halt the spread of the virus.

    In a rare show of defiance, crowds in China gathered for the third night as protests against COVID restrictions spread to Beijing, Shanghai and other cities. People held up blank sheets of paper, symbolizing censorship, and demanded the Chinese president step down. Photo: Kyodo News/Zuma Press

    Chinese health officials said Tuesday they are preparing a push to get more older people vaccinated, the Guardian reported. The National Health Commission told reporters it would target more vaccinations at people older than 80 and would reduce to three months the gap between basic vaccination and booster shots for elderly people.

    But experts, including President Joe Biden’s chief medical adviser, Anthony Fauci, have expressed concern that China’s homegrown vaccines are not effective enough. China has not yet approved the vaccines developed by Pfizer
    PFE,
    -0.39%
    ,
    BioNTech
    BNTX,
    +1.16%

    and Moderna
    MRNA,
    -0.17%

    for public use. The shortcomings of China’s vaccines have led Chinese doctors to warn that a lifting of the zero-COVID policy could lead to a massive surge in cases that could overwhelm China’s healthcare system.

    Now read: China’s strict zero-COVID policy isn’t worth the damage it does to its economy

    Meanwhile, with police out in force, there was little news of protests in Beijing, Shanghai or other cities on Tuesday, the AP reported separately.

    In the U.S., known cases of COVID are rising again, with the daily average standing at 41,755 on Monday, according to a New York Times tracker, up 6% from two weeks ago. Cases are rising in 22 states, as well as Guam and Washington, D.C., and are flat in Nebraska. They are rising fastest in Arizona, where they are up 82% from two weeks ago, followed by Michigan, where they are up 77%.

    The daily average for hospitalizations is flat at 28,135, while the daily average for deaths is up 6% to 314.

    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

    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:

    • The World Health Organization has issued an emergency-use listing for the Novavax
    NVAX,
    +6.19%

    protein-based COVID vaccine as a primary series for children ages 12-17 and as a booster for those ages 18 and older, Novavax said Tuesday. The WHO previously granted an emergency-use listing for the Nuvaxovid vaccine in adults ages 18 and older in December 2021, the company said. The new listing also paves the way for adults to get a booster shot of the vaccine about six months after completing the primary two-dose series.

    • New Jersey Gov. Phil Murphy, a Democrat, said Monday his administration has launched a promised review of its handling of the pandemic, the AP reported. The administration hired regional law firm Montgomery McCracken Walker & Rhoads — which has offices in the state as well as Delaware, Pennsylvania and New York — along with management consulting firm Boston Consulting Group to conduct the review. The review is expected to end with a report in late 2023, the governor said.

    • A Connecticut program that offered “hero pay” to essential workers at the peak of the pandemic got so many applicants that state lawmakers had to go back into session Monday to provide extra funding and put new limits on who could get the biggest bonuses, the AP reported. Initially, the state had expected to award about $30 million in bonuses to people who had to go to work, in person, in jobs in healthcare, food distribution, public safety and other essential services. But after getting 155,730 applications from eligible people, lawmakers realized they would have to either put more money in or slash benefits.

    Here’s what the numbers say:

    The global tally of confirmed cases of COVID-19 topped 641.8 million on Monday, while the death toll rose above 6.63 million, according to data aggregated by Johns Hopkins University.

    The U.S. leads the world with 98.6 million cases and 1,079,477 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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  • Cyber Monday Retailers Worried Americans Not Ready To Buy Goods Over World Wide Web

    Cyber Monday Retailers Worried Americans Not Ready To Buy Goods Over World Wide Web

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    Image for article titled Cyber Monday Retailers Worried Americans Not Ready To Buy Goods Over World Wide Web

    NEW YORK—Expressing skepticism about the unproven technology’s potential in the lead-up to the holiday season, Cyber Monday retailers reportedly worried this week that Americans were simply not ready to buy goods over the World Wide Web. “While there may be a few fringe dedicated Netizens interested in online holiday shopping, we’re not sure the average joe has the understanding or, frankly, interest needed to purchase goods in cyberspace,” said Best Buy vice president Scott Evans, echoing thousands of web retailers who noted that Americans have always enjoyed the atmosphere and experience of brick-and-mortar stores, and the rise of the information superhighway did not seem poised to change that. “I’ll admit I’m a bit in the dark on how it even works. People type ‘http://www.bestbuy.com’ into their web browser, sure, but what happens after that? Do they just send us a check in the mail? Plus, after they buy their item, who drives it to their house? Me? Our IT guy showed the whole thing to me, and it just went way over my head. So I can’t imagine how the average consumer feels. Computers are great for playing solitaire, but I think using them to buy goods is just more of a headache than it’s worth for most Americans.” Evans added that all of this was obviously purely hypothetical, given that the company only expected to get a few dozen online shoppers during the holidays.

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  • Fidelity Begins Opening Retail Bitcoin Trading Accounts

    Fidelity Begins Opening Retail Bitcoin Trading Accounts

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    Fidelity, one of the world’s largest financial services providers, has officially started opening retail bitcoin trading accounts.

    The development comes after their announcement of a wait list previously this month. According to a report by The Block, certain users, presumably those on the wait list, received an email detailing the release, which stated that “The wait is over.”

    Fidelity has been active in the bitcoin industry for some time — according to the company website, it began mining bitcoin in 2014. In addition, it launched a spot bitcoin ETF in Canada in December of 2021.

    The financial services giant’s interest in bitcoin has not come without criticism, having been the subject of U.S. senators’ scrutiny for its offering of a 401k plan that allows users to allocate to bitcoin.

    The same criticism has resurfaced again recently, from the same group of senators, who stated in their latest letter, “Fidelity Investments has opted to expand beyond traditional finance and delve into the highly unstable and increasingly risky digital asset market.”

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  • China’s zero-COVID strategy makes no sense and its homegrown vaccines are not ‘particularly effective,’ says  Fauci

    China’s zero-COVID strategy makes no sense and its homegrown vaccines are not ‘particularly effective,’ says Fauci

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    Widespread protests across China over the government’s zero-COVID policy dominated pandemic headlines Monday, with Anthony Fauci, President Joe Biden’s chief medical adviser, weighing in with the view that the strategy does not make public-health sense. 

    China’s biggest challenge is low vaccination rates — and a vaccine that has not been “particularly effective at all” compared with the ones being used in the West that are made by Pfizer
    PFE,
    +0.50%

    and its German partner BioNTech 
    BNTX,
    +5.68%

    and by Moderna
    MRNA,
    +1.08%
    ,
    said Fauci, who is retiring next month.

    Fauci recalled that when New York hospitals were overwhelmed by COVID cases three years ago, the decision was made to introduce restrictions, such as social distancing and shutdowns, to help flatten the curve of infections. But he noted that it was a temporary move aimed at buying time to get more people vaccinated and move personal protective equipment to where it was needed.

    The first vaccine was distributed in the U.S. in December 2020.

    Read: U.S. stock futures fall as Chinese protests rattle markets, oil hits 2022 low

    “It seems that in China, it was just a very, very strict, extraordinary lockdown where you lock people in the house, but without, seemingly, any endgame to it,” said Fauci, who is also head of the National Institute of Allergy and Infectious Diseases. 

    Fauci said one mistake the Chinese government has made is to refuse outside vaccines. “But also, interestingly, they did not, for reasons that I don’t fully appreciate, protect the elderly by making sure the elderly got vaccinated,” he said. “So if you look at the prevalence of vaccinations among the elderly, that was almost counterproductive. The people you really needed to protect were not getting protected.”

    The protests have roiled financial markets and caused oil prices to erase their entire year-to-date gain. In a highly unusual move, protesters in Shanghai called for China’s powerful leader Xi Jinping to resign, an unprecedented rebuke as authorities in at least eight cities struggled Sunday to suppress demonstrations that represent a rare direct challenge to the ruling Communist Party, as the Associated Press reported.

    The BBC said reporter Ed Lawrence, who was arrested while covering protests, was beaten and kicked by police while in custody.

    “We have had no explanation or apology from the Chinese authorities, beyond a claim by the officials who later released him that they had arrested him for his own good in case he caught COVID from the crowd,” the broadcaster said in a statement. “We do not consider this a credible explanation.”

    For more, see: BBC says official explanation for journalist arrest in China is that he was detained to prevent contraction of COVID

    See also: China protests are biggest threat to Communist Party rule since Tiananmen Square, Kyle Bass says

    In a rare show of defiance, crowds in China gathered for a third night as protests against COVID restrictions spread to Beijing, Shanghai and other cities. People held blank sheets of paper, symbolizing censorship, and demanded that the Chinese president, Xi Jinping, step down. Photo: Noel Celis/Agence France-Presse/Getty Images

    In the U.S., known cases of COVID are rising again with the daily average standing at 41,997 on Sunday, according to a New York Times tracker, up 6% from two weeks ago.

    Cases are currently rising in 22 states, plus Washington, D.C., and Guam, but are falling elsewhere.

    The daily average for hospitalizations is up 4% to 29,053. Hospitalizations are rising in 23 states, the tracker shows.

    The daily average for deaths is up 4% to 330.

    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:

    • The World Health Organization said Monday it is recommending the term “mpox” as a new name for monkeypox disease and that it would use both names for a year while “monkeypox” is phased out. “When the outbreak of monkeypox expanded earlier this year, racist and stigmatizing language online, in other settings and in some communities was observed and reported to WHO,” the agency said in a statement. “In several meetings, public and private, a number of individuals and countries raised concerns and asked WHO to propose a way forward to change the name.” The WHO has responsibility for assigning names to new — and exceptionally, to existing — diseases, under the International Classification of Diseases and the WHO Family of International Health Related Classifications through a consultative process that includes WHO member states, it explained. The new name was decided upon following consultations with global experts, it said. 

    Residents in Shanghai received the world’s first inhaled COVID-19 vaccine by taking sips from a cup. WSJ’s Dan Strumpf explains how the new type of vaccine works and what it means for China’s reopening. Photo: Associated Press/Shanghai Media Group

    • Unrest at one of China’s biggest manufacturing centers may cause a production shortfall this year of possibly 6 million Apple iPhone Pros, according to a source cited by Bloomberg. The Foxconn Technology 2354 facility in Zhengzhou, which makes the majority of Apple’s premium phones, has been struggling for weeks as workers rebel against COVID lockdown policies. Apple 
    AAPL,
    -2.13%

    recently lowered its overall production target from 90 million units to 87 million units. However, Foxconn believes it can make up any shortfall from Zhengzhou in 2023.

    • A blood-thinning drug called Apixaban, which has been used for patients recovering from COVID, does not work and can cause major bleeding, according to new research reported by the Guardian. The anticoagulant, given to patients when they are discharged from a hospital after being treated for moderate or severe COVID, is widely used by hospitals across the U.K.’s National Health Service. However, the government-funded Heal-Covid trial has found that the drug does not work. Charlotte Summers, the chief investigator of the trial, said: “These first findings from Heal-Covid show us that a blood-thinning drug, commonly thought to be a useful intervention in the post-hospital phase, is actually ineffective at stopping people dying or being readmitted to hospital.”

    Here’s what the numbers say:

    The global tally of confirmed cases of COVID-19 topped 641.6 million on Monday, while the death toll rose above 6.63 million, according to data aggregated by Johns Hopkins University.

    The U.S. leads the world with 98.6 million cases and 1,079,199 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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  • Many investors are betting on an inflation peak. Here’s why a former hedge-fund manager says they’re wrong.

    Many investors are betting on an inflation peak. Here’s why a former hedge-fund manager says they’re wrong.

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    Investors are waking up to big trouble in big China. Stock futures and oil prices are falling after angry anti-COVID zero protests swept the country.

    “This is a sudden powerful new distraction for markets when this week was supposed to be about incoming U.S. data,” sum up strategists at Saxo Bank. They say watch companies exposed to China, “given forward earnings are likely to be downgraded following further China lockdowns and protests.” 

    Before China grabbed the spotlight, holiday weekend sales, jobs and inflation data that due this week, as well as remarks by Fed Chairman Jerome Powell were the big focus.

    Other questions are now swirling. Will China-related falls in oil prices lend to the peak inflation theory? And what about China’s post-COVID economic rebirth?

    Onto our call of the day, which says it’s time to short long bonds because of sticky food inflation — thanks to China. It comes from Russell Clark, a former hedge-fund manager who has spent the last 20 years focusing on that market, macro and short selling. 

    He notes investors have been scooping up the the iShares 20 years+ Treasury Bond ETF
    TLT,
    -0.34%
    ,
    a liquid exchange-traded fund that buys long-dated bonds, even as with U.S. inflation hovering at 1970 highs.

    “The reason that people are getting bullish bonds I believe is that the yield curve has inverted. And every time that has happened, you have a recession and you want to get out of equities and into bonds,” says Clark. A yield curve inversion occurs when long-term interest rates drop below short term rates. The inversion of 2 and 10-year Treasury yields is at its steepest since the 1980s.

    Clues may lie in Japan’s poorly performing bond market. “Not only has it been prescient in leading the U.S. bond yields lower from 1999 onward, in 2020 the JGB market was also prescient in signaling the future U.S. treasury sell off,” he says.


    Russell Clark

    And what Japan is likely seeing that U.S. investors aren’t right now is China-driven food inflation. That’s something the Fed will find it tough to ignore, he said.

    Since the since the 1980s, food commodity prices have followed raw commodity prices higher, If the Fed wants to work that down, it will raise interest rates. For example, falling natural-gas prices
    NG00,
    -3.37%

    would help ease fertilizer costs for farmers.


    Russell Clark

    Clark points out that China is the world’s biggest food importer, with much higher prices than the U.S.

    “Pork, which is the most consumed meat in China, is now 3 times more expensive than the U.S. market, and has recently doubled in price. As Japan is also a large importer of pork, perhaps this was the reason the JGB market sold off before the U.S.,” he said.

    Beef is also a major import for China, and yes, prices are much higher than that of the U.S.

    “In essence, I am saying that China is exporting food inflation to the rest of the world, and I don’t see that ending at the moment. JGBs seem to agree – and when I look at the index value of US Food CPI on a log basis, I keep thinking that is says interest rates are going higher not lower,” said Clark.

    He sees food inflation looking secular, rather than cyclical, due to the demands of an increasingly urbanized China. “Secular food inflation implies POLITICAL pressure to have higher interest rates. US treasuries look a short to me, just as everyone has gotten long,” he said.

    The markets

    Stock futures
    ES00,
    -0.73%

    YM00,
    -0.54%

    NQ00,
    -0.72%

    are falling, and Treasury yields
    TMUBMUSD10Y,
    3.684%

    TMUBMUSD02Y,
    4.467%

    and oil
    CL.1,
    -3.12%

    also are falling. The Japanese yen
    USDJPY,
    -0.61%

    is seeing some safe-haven bids. The Hong Kong Hang Seng Index
    HSI,
    -1.57%

    closed down 1.5%.

    For more market updates plus actionable trade ideas for stocks, options and crypto, subscribe to MarketDiem by Investor’s Business Daily.

    The buzz

    An apartment-building fire in a locked-down city that killed 10 appeared to spark protests across China, calling for the President Xi Jinping to step down and zero-COVID policies to stop. A BBC reporter was arrested and beaten. Meanwhile, lockdowns mean China farmers are destroying crops they can’t sell.

    And similar unrest at China’s Zhengzhou Foxconn
    2317,
    -0.50%

    factory is expected to cause a shortfall of 6 million Apple
    AAPL,
    -1.96%

    iPhone Pros this year.

    Pinduoduo shares
    PDD,
    -1.44%

    are soaring after the China-based mobile marketplace reported profit and revenue beats.

    MGM Resorts 
    MGM,
    -0.42%
    ,
    Las Vegas Sands 
    LVS,
    +0.26%

    and Wynn Resorts 
    WYNN,
    -0.57%

    higher in premarket after Macao tentatively renewed their casino licenses.

    Retailers are in focus after Black Friday online sales topped a record $9 billion. That’s as some wonder if Cyber Monday is still a thing.

    St. Louis Fed President James Bullard will sit down for an interview with MarketWatch on Monday, at 12 noon Eastern. New York Fed President John Williams address the Economic Club of New York at the same time. Fed’s Powell will speak on Wednesday, along with several other Fed officials this week.

    A busy data week starts Tuesday with home-price indexes and consumer confidence data. GDP, the PCE price index for October — a favored gauge of the Federal Reserve and November employment data are also on tap this week.

    Best of the web

    ‘I believe the economy is the biggest bubble in world history,’ warns ‘Rich Dad, Poor Dad’s Robert Kiyosaki.

    Iran was calling for the U.S. to be expelled from the Qatar World Cup.

    Lab study shows next COVID strain will be more deadly.

    The tickers

    These were the top-searched tickers on MarketWatch as of 6 a.m. Eastern:

    Ticker

    Security name

    TSLA,
    -0.19%
    Tesla

    GME,
    -1.99%
    GameStop

    AMC,
    -1.70%
    AMC Entertainment

    AAPL,
    -1.96%
    Apple

    COSM,
    +34.06%
    Cosmos Holdings

    AMZN,
    -0.76%
    Amazon.com

    BBBY,
    -2.70%
    Bed Bath & Beyond

    MULN,
    -2.39%
    Mullen Automotive

    APE,
    +0.83%
    AMC Entertainment Holdings preferred shares

    DWAC,
    +6.44%
    Digital World Acquisition Corp.

    Random reads

    Chinese woman on a mission to visit everyone else’s lonely elderly relatives.

    ‘Gaslighting’ is Merriam Webster’s word of the year. No, really.

    Need to Know starts early and is updated until the opening bell, but sign up here to get it delivered once to your email box. The emailed version will be sent out at about 7:30 a.m. Eastern.

    Listen to the Best New Ideas in Money podcast with MarketWatch reporter Charles Passy and economist Stephanie Kelton

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  • Virginia Walmart shooter was store manager, police and witness say

    Virginia Walmart shooter was store manager, police and witness say

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    CHESAPEAKE, Va. (AP) — A Walmart manager opened fire on fellow employees in the break room of a Virginia store, killing six people in the country’s second high-profile mass shooting in four days, police and a witness said Wednesday.

    The gunman, who apparently shot himself, was dead when police found him, Chesapeake Police Chief Mark G. Solesky said. There was no clear motive for the shooting, which also put four people in the hospital.

    In One Chart: Chart shows 4-year high for lone shooters like at the Virginia Walmart and Colorado LGBTQ club — but they’re not the worst perpetrators of gun violence

    The store was busy just before the attack Tuesday night as people stocked up ahead of the Thanksgiving holiday, a shopper told a local TV station.

    Employee Briana Tyler said workers had gathered in the break room as they typically did ahead of their shifts. “I looked up, and my manager just opened the door and he just opened fire,” she told ABC’s “Good Morning America,” adding that “multiple people” dropped to the floor.

    “He didn’t say a word,” she said. “He didn’t say anything at all.”

    Solesky confirmed that the shooter, who used a pistol, was a Walmart employee but did not give his name because his family had not been notified. The police chief could not confirm whether the victims were all employees.

    Employee Jessie Wilczewski told Norfolk television station WAVY that she hid under the table and the shooter looked at her with his gun pointed at her, told her to go home and she left.

    “It didn’t even look real until you could feel the … ‘pow-pow-pow,’ you can feel it,” Wilczewski said. “I couldn’t hear it at first because I guess it was so loud, I could feel it.”

    President Joe Biden in a statement said he and first lady Jill Biden “grieve for the family, for the Chesapeake community and for the Commonwealth of Virginia.”

    Gov. Glenn Youngkin tweeted that he was in contact with law-enforcement officials in Chesapeake, Virginia’s second largest city, which lies next to the seaside communities of Norfolk and Virginia Beach.

    “Our hearts break with the community of Chesapeake this morning,” Youngkin wrote. “Heinous acts of violence have no place in our communities.”

    It was the second time in a little more than a week that Virginia has experienced a major shooting. Three University of Virginia football players were fatally shot on a charter bus as they returned to campus from a field trip on Nov. 13. Two other students were wounded.

    “I am devastated by the senseless act of violence that took place late last night in our city,” Mayor Rick W. West said in a statement posted on the city’s Twitter account Wednesday. “Chesapeake is a tight-knit community, and we are all shaken by this news.”

    A database run by the Associated Press, USA Today and Northeastern University that tracks every mass killing in America going back to 2006 shows this year has been especially violent.

    The U.S. has now had 40 mass killings so far in 2022, compared with 45 for all of 2019. The database defines a mass killing as at least four people killed, not including the killer.

    The attack at the Walmart came three days after a person opened fire at a gay nightclub in Colorado, killing five people and wounding 17. Last spring, the country was shaken by the deaths of 21 when a gunman stormed an elementary school in Uvalde, Texas.

    Tuesday night’s shooting also brought back memories of another at a Walmart in 2019, when a gunman who targeted Mexicans opened fire at a store in El Paso, Texas, and killed 22 people.

    A 911 call about the shooting came in just after 10 p.m. Solesky did not know how many shoppers were inside, whether the gunman was working or whether a security guard was present.

    Joetta Jeffery told CNN that she received text messages from her mother who was inside the store when the shots were fired. Her mother, Betsy Umphlett, was not injured.

    “I’m crying, I’m shaking,” Jeffery said. “I had just talked to her about buying turkeys for Thanksgiving, then this text came in.”

    One man was seen wailing at a hospital after learning that his brother was dead, and others shrieked as they left a conference center set up as a family reunification center, The Virginian-Pilot reported.

    Camille Buggs, a former Walmart employee, told the newspaper she went to the conference center seeking information about her former co-workers. “You always say you don’t think it would happen in your town, in your neighborhood, in your store — in your favorite store, and that’s the thing that has me shocked,” Buggs said.

    Walmart
    WMT,
    +0.74%

    tweeted early Wednesday that it was “shocked at this tragic event.”
    In the aftermath of the El Paso shooting, Walmart made a decision in September 2019 to discontinue sales of certain kinds of ammunition and asked that customers no longer openly carry firearms in its stores.

    It stopped selling handgun ammunition as well as short-barrel rifle ammunition, such as the .223 caliber and 5.56 caliber used in military style weapons. Walmart also discontinued handgun sales in Alaska.

    The company had stopped selling handguns in the mid-1990s in every state but Alaska. The latest move marked its complete exit from that business and allowed it to focus on hunting rifles and related ammunition only.

    Many of its stores are in rural areas where hunters depend on Walmart to get their equipment.

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  • ‘There are plenty of storm clouds on the horizon’: 5 things not to buy on Black Friday

    ‘There are plenty of storm clouds on the horizon’: 5 things not to buy on Black Friday

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    It’s a year for shopping prudently.

    Americans will spend between $942.6 billion and $960.4 billion this holiday season, according to projections from the National Retail Federation. That’s up from last year when holiday sales hit a record $889.3 billion, the trade association said.

    However, people are not willing to go as crazy this Black Friday compared to previous years: that 6% to 8% year-over-year growth expectation is slower than the 13.5% annual increase in holiday season spending in 2021 when consumers had pandemic-era government benefits to spend.

    Once again, millions of people will also be shopping from the comfort of their home and avoiding the Black Friday crowds. Online and other non-store sales are predicted to rise 10% to 12% (to between $262.8 billion and $267.6 billion).

    People have reason to be concerned about their spending.

    “The economy is probably doing better than it feels right now, but that’s not true for everyone of course,” said Ted Rossman, senior industry analyst at Bankrate.com. “There are plenty of storm clouds on the horizon.” He cited rising interest rates, 40-year high inflation and tech layoffs. 

    People have reason to be concerned about their spending. The personal saving rate — meaning personal saving as a percentage of disposable income, or the share of income left after paying taxes and spending money — fell to 3.3% in the third quarter from 3.4% in the prior quarter, the government said last month. 

    Despite a strong labor market and unemployment hovering at 3.7% in October, Rossman said, “it still seems like a recession is likely in 2023, although the best guess is that it will be a mild one.”

    So what should you not buy this Black Friday? Quite a lot, if you don’t believe in living large. Here are 5 things to think about avoiding:

    — Quentin Fottrell

    Tech accessories

    For tech accessories — like earbuds and headphones — waiting until December may be a better way to score better deals, added Ryan McGonagill, director, industry research at Savings.com, another site that aggregates discounts.

    The most popular electronic products like Apple AAPL iPads, MacBooks and iPhones have scant Black Friday deals. “For a limited time, get an Apple Gift Card to use on a later purchase when you buy an eligible iPhone, Apple Watch, Mac, AirPods, and more,” according to Apple’s Black Friday offer.

    Computer makers and retailers, however, are coming off the work-from-home boom and may have inventory they need to thin before year’s end. Holiday discounts on computers, at least through October, were at 10% off the base price, according to analysis from Adobe
    ADBE,
    +2.92%
    .
     

    The software and analytics provider said computer discounts could go much steeper, up to 32% off the base price before the end of the year. Cyber Monday could be the best day for bargains on computers, Adobe said, but computer deals may stick around for the rest of 2022.

    Pay attention to early deals, if you desperately need a new laptop. “Many retailers offer the same pricing on Black Friday and Cyber Monday,” said Kristin McGrath, editor at RetailMeNot.com, a site that promotes deals. “So start looking on Black Friday and use Cyber Monday as a second chance to snag what you missed.”

    — Andrew Keshner

    Seasonal items

    Winter wear is usually not going to be on sale before Christmas, so it’s best to shop for your puffy jackets and snow boots in the New Year, if you can. The same goes for white linen, tools and holiday decorations, said Charles Lindsey, associate professor in the Marketing School of Management at the University at Buffalo.

    Most stores put their coats, hats, scarves and flannel pajamas on sale — with discounts on big-name brands of 50% or more in January — to make room for their spring collections. Similarly, buy summer clothes in the fall and winter. 

    “The best time to buy holiday decor is immediately after said holidays,” according to DealNews, a site offering shopping advice. “After Christmas sales are generally your best bet for snagging deeply discounted ornaments, lights, and inflatables in order to be well prepared for next year.” 

    Fashion-conscious shoppers inclined to snap up discounted items may want to practice patience on Black Friday. Apparel may have even deeper discounts after the holidays. If you feel compelled to buy something new to wear to the office party, invest in quality pieces. Fast fashion has a cost: It has contributed to a waste crisis, in part because such items are not meant to last very long in your closet.

    But that does not mean you should not keep your eyes peeled for some seasonal goods on Black Friday. Walmart
    WMT,
    +0.34%
    ,
    for instance, is pushing out the boat early with some discounts on toys, including hoverboards, bicycles, remote-control cars, and karaoke machines. Similarly, Kohl’s
    KSS,
    +4.17%

    has discounts on a range of doll’s houses.

    — Quentin Fottrell and Emma Ockerman

    Appliances and white goods

    There might be tempting Black Friday deals on appliances, mattresses and furniture. Discounts on appliances may reach up to an 18% from the base price, Adobe said. Still, “you’re going to get another shot at them during New Year’s Eve sales and again during Presidents Day sales in February,” McGrath said.

    If Black Friday is “too chaotic …you’ll have plenty of opportunities to save,” she added. Department stores usually run very attractive discounts on houseware in the days following Christmas. “Stores know they’ll be getting a lot of traffic with so many people returning gifts — and hope to convince shoppers to make an impulse self-gifting purchase or two,” McGrath said.

    If you can’t wait, Costco
    COST,
    +1.64%

    is already rolling out deals on white goods and appliances, including $70 off a Sonos
    SONO,
    +1.87%

    WiFi speaker. However, Consumer Reports cautions consumers against falling for big deals without checking out the reliability of the brand first, as you could end up paying more in repairs down the road. 

    You might be tempted by offers and rebates on matching kitchen suites — typically a refrigerator, range, dishwasher, and microwave — from the same maker,” Consumer Reports said. “But price is only part of the equation when you’re purchasing appliances. Reliability is key, and it can vary within a brand’s offerings.”

    — Andrew Keshner

    Fitness equipment

    One of the best times to buy exercise equipment is around the New Year, when people are making resolutions to improve their health, said Regina Conway, who researches sales and promotions for Slickdeals, a site that tracks retail discounts.

    When you make your purchase, think twice before buying equipment that runs on proprietary technology, like Peloton
    PTON,
    -1.13%

    or Lululemon’s
    LULU,
    +1.79%

    Mirror exercise products, mainly because the at-home fitness boom faces an uncertain future post-pandemic, Conway noted.

    However, this Black Friday is a little different than previous years, and there are some deals in categories that traditionally don’t have good Black Friday discounts, including exercise equipment. “This year we’re seeing strong Black Friday deals from industry stalwarts like NordicTrack,” Conway said.

    Peloton Interactive, which is facing a challenging time since people are no longer stuck at home due to the pandemic, is currently offering $600 off this fitness bike package. However, consumers will still have to fork over $2,195 for the machine and exercise regime.

    “We think consumers are likely to continue to prefer out-of-home experiences in the near-term and believe Peloton is still working through pandemic pull-forward,” Cowen & Co. analyst John Blackledge wrote in an analyst note on Tuesday, citing “limited visibility” on Peloton’s fiscal 2023 performance.

    — Leslie Albrecht and Quentin Fottrell

    Big-ticket items like TVs 

    Does Amazon
    AMZN,
    +0.80%

    founder Jeff Bezos have a point about the dangers of splurging this year? In something of a Black Friday surprise, Bezos offered some shocking spending tips as Americans gear up for the holiday shopping season — amid four-decade-high inflation. Or, to be more accurate, he offered tips on what not to spend your money on.

    ‘If you’re an individual and you’re thinking about buying a large-screen TV, maybe slow that down, keep that cash, see what happens. Same thing with a refrigerator, a new car, whatever. Just take some risk off the table,” Bezos said in a recent interview on CNN
    WBD,
    +2.27%
    .
    The remarks drew a significant amount of scorn on social media, with some critics advising people to avoid shopping on Amazon too.

    About those TVs: “They’re normally not going to be a high-end TV brand,” Lindsey said. “It will be a lower to mid-tier brand. Companies utilize these TVS as doorbusters to get people in the store and people clicking on their website. You’re probably better off shopping around the Superbowl in late January.”

    Rossman said consumers are becoming more judicious about their Black Friday splurging. “People seem to be pulling back on some big-ticket purchases,” he told MarketWatch. “For example, sellers of appliances, electronics and furniture all posted disappointing results in the most recent retail sales report.”

    “Yet discretionary sectors such as travel and dining are seeing sharp increases in spending,” he added. “I think the main explanation is pent-up demand. People are prioritizing experiences over things right now, largely due to the pandemic. There was also a pull-forward in demand for many physical goods the past couple of years as many out-of-home activities were curtailed.”

    — Quentin Fottrell

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  • China’s three-week COVID case tally tops 253,000 and daily average is rising, government says

    China’s three-week COVID case tally tops 253,000 and daily average is rising, government says

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    More than 253,000 coronavirus cases have been found in China in the past three weeks and the daily average is rising, the government said Tuesday, the Associated Press reported.

    The trend is putting pressure on officials who are trying to ease economic disruption by easing strict controls that have confined millions of people to their homes.

    China is the only major country in the world still trying to curb virus transmissions through strict lockdown measures and mass testing. The ruling Communist Party promised earlier this month to reduce disruptions from its “zero- COVID” strategy by making controls more flexible, but so far, progress has been slow.

    Beijing, which announced its first COVID death in about six months over the weekend, has locked down parks, populous districts, stores and offices and many school kids have resumed online learning.

    The past week’s average of 22,200 daily cases is double the previous week’s rate, the official China News Service reported, citing the National Bureau of Disease Prevention and Control.

    On Tuesday, the government reported 28,127 cases found over the past 24 hours, including 25,902 with no symptoms. Almost one-third, or 9,022, were in Guangdong province, the heartland of export-oriented manufacturing adjacent to Hong Kong.

    In the U.S., known cases of COVID are rising again with the daily average standing at 41,530 on Monday, according to a New York Times tracker, up 4% from two weeks ago.

    Don’t miss: Confused about COVID boosters? Here’s what the science and the experts say about the new generation of shots.

    Cases are rising in 24 states, plus Washington, D.C., Guam and Puerto Rico. Washington state has replaced Nebraska as leader by new cases, which have climbed 423% from two weeks ago. That’s followed by Arizona, where they are up 110% and California, up 60%.

    The daily average for hospitalizations was down 1% at 27,547, but again, the trend is not uniform across the U.S. Hospitalizations are up 60% in Alaska, up 47% in Arizona and up 30% in Wyoming.

    The daily average for deaths is down 2% to 294. 

    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:

    • Japan approved an antiviral pill from Shionogi & Co.
    4507,
    +2.77%

    to treat COVID after the company provided new data to show the drug’s efficacy, the Wall Street Journal reported. The treatment is the first locally developed alternative to Pfizer Inc.’s
    PFE,
    +1.45%

    Paxlovid and Merck & Co.’s
    MRK,
    +0.93%

    Lagevrio, which have been authorized for emergency use in Japan. Shionogi aims to win approval from the Food and Drug Administration for its pill in the U.S. Osaka-based Shionogi filed in February for emergency approval for the drug, known as Xocova, in Japan. The health ministry panel said in July it needed to see results from a larger human trial because data submitted at the time didn’t sufficiently show improvements in symptoms associated with COVID.

    • Dubai International Airport passenger numbers surpassed pre-COVID pandemic levels in the third quarter of 2022, the airport’s chief executive said, causing the airport to revise its annual forecast by another 1 million passengers, the AP reported. Paul Griffiths, who oversees the world’s busiest airport, told the Associated Press the annual forecast at Dubai International, or DXB, is more than 64 million. The airport saw 18.5 million passengers in the third quarter of this year, up from 17.8 million during the first quarter of 2020—prior to and at the dawn of the pandemic.

    • Get ready for long lines at U.S. airports and traffic jams galore—just like old times. Airports and roads may be “jam-packed” this year, according to the AAA. It estimates that 53.6 million people will travel for the Thanksgiving weekend, reaching 98% of pre-pandemic Thanksgiving travel. “Families and friends are eager to spend time together this Thanksgiving, one of the busiest for travel in the past two decades,” said Paula Twidale, senior vice president, AAA Travel. “Plan ahead and pack your patience, whether you’re driving or flying.”

    Here’s what the numbers say:

    The global tally of confirmed cases of COVID-19 topped 638.5 million on Monday, while the death toll rose above 6.62 million, according to data aggregated by Johns Hopkins University.

    The U.S. leads the world with 98.4 million cases and 1,077,225 fatalities.

    The Centers for Disease Control and Prevention’s tracker shows that 228.2 million people living in the U.S., equal to 68.7% of the total population, are fully vaccinated, meaning they have had their primary shots.

    So far, just 35.3 million Americans have had the updated COVID booster that targets the original virus and the omicron variants, equal to 11.3% of the overall population.

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  • Confused about COVID boosters? Here’s what the science and the experts say about the new generation of shots.

    Confused about COVID boosters? Here’s what the science and the experts say about the new generation of shots.

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    As we head into the third winter of the pandemic, only about 13% of American adults — less than 11% of Americans overall — have received the bivalent COVID-19 booster. 

    Only about 34 million adults in the U.S. have opted to get the new shot, which became available in September. The bivalent boosters, which were developed by Moderna and BioNTech/Pfizer, are designed to better protect people against the forms of the virus that are currently circulating.

    Medical experts say the lackluster interest in the new boosters is due to several factors: pandemic fatigue, mixed messages from public-health officials, confusion about how the new boosters are different from previous shots, and the government’s decision to authorize the updated boosters without first getting clinical data in humans. 

    “It’s hard for people to wade through that,” said Robert Wachter, chair of the department of medicine at the University of California, San Francisco. “Some of them are just throwing up their hands and saying, ‘I got vaccinated, and that’s all I need to do.’ Which, unfortunately, is not.”

    A lot has changed since 2020. We now have vaccines that do a pretty good job of keeping most people from getting so sick that they end up in the hospital or die. You can now pick up at-home tests from pharmacies, and there are antiviral drugs that help treat COVID and may help prevent long COVID, in which symptoms can linger long after an infection. And now we also have the updated boosters, which are another way to ward off the worst of the virus.

    Those boosters, however, don’t confer total protection from getting sick, leading some people, particularly those who are young and healthy, to ask: Why get one, then?

    With new variants like BQ.1 and BQ.1.1 now the dominant strains circulating in the U.S., and with the coming holidays bringing more people together to spend time socializing indoors with friends and family, it’s important to understand that your immunity, whether from an infection or vaccination, wanes within four to six months. In fact, immunity to all coronaviruses wanes over time “for reasons that we don’t quite understand,” Kami Kim, director of infectious-disease research at Tampa General Hospital’s Global Emerging Diseases Institute, told me.

    “If you’re past three months [after vaccination or infection], you don’t want to rely on you having a BA.5 infection, because BQ.1.1 still can hit you,” said Eric Topol, chair of innovative medicine at Scripps Research in La Jolla, Calif.

    Here are answers to some common questions about COVID.

    1. What’s the difference between this booster and the shots that were available last year? 

    The earlier booster shots were simply additional, smaller doses of the original vaccine. But now there are two bivalent COVID-19 boosters available in the U.S.: Moderna’s
    MRNA,
    +1.61%

    MRNA-1273.222 and the BNT162b2 Bivalent from BioNTech
    BNTX,
    +0.20%

    and Pfizer
    PFE,
    +1.87%
    .
     

    Both shots are designed to protect against the original strain of the virus in addition to the BA.4 and BA.5 omicron subvariants. The bivalent boosters were designed to better protect people against the forms of the virus that are currently circulating, as well as future variants. It’s a similar approach to the way influenza strains are selected for flu shots every year. 

    “It’s the same exact mRNA technology [as the original vaccine], but each dose now has half of the [original] variant,” said Jennifer Beam Dowd, an epidemiologist and professor of demography and population health at the University of Oxford in the U.K.

    In June of this year, the U.S. Food and Drug Administration asked drugmakers to design the next generation of COVID boosters using this formula. (In Europe, regulators took a slightly different approach, first opting for bivalent boosters that equally protect against the original virus and the BA.1 subvariant of omicron before adding a recommendation for the same bivalent formula that’s being used in the U.S.

    “Part of the rationale for keeping the old version and BA.4/BA.5 is that if you put all your eggs in the basket, as far as BA.4/BA.5, then the virus will change to turn into more like the original version,” said Tampa General Hospital’s Kim. “It’s hedging your bets.”

    Up until last week, BA.5 had been the dominant variant in the U.S. But as of Friday, BQ.1 and BQ.1.1, which are sublineages of BA.5, now make up the majority of new infections in the U.S., according to the Centers for Disease Control and Prevention. 

    This isn’t all bad news. BQ.1.1 is closely related to BA.5, according to Dowd, and that means many of the protective qualities of the bivalent booster will also guard against the new variants. 

    2. What does the science say about the new boosters?

    There is preliminary data about both bivalent boosters that appears to indicate they work against BQ.1.1 as well as BA.5. However, scientists and physicians say they are still waiting to see peer-reviewed research from the clinical trials to fully gauge the effectiveness of both shots.

    • Moderna’s booster: Early clinical data shows that Moderna’s bivalent booster produced a 5- to 6-fold increase in neutralizing antibodies against the BA.4 and BA.5 variants in about 500 adults who were previously vaccinated and boosted, according to a Nov. 14 news release. The Phase 2/3 clinical trial compared the new booster’s response against the company’s original booster. Moderna also said that the bivalent shot increased antibodies protecting against BQ.1.1, though not as much as it did against BA.4 and BA.5, based on an analysis of about 40 participants in the same study.

    “It’s not orders of magnitude more protection — but at least 5- to 6-fold more protection against BA.5, that’s good,” Topol said.

    • BioNTech and Pfizer’s booster: In a preprint published Nov. 17, the two companies said their bivalent booster led to an 8.7-fold increase in neutralizing antibodies against BQ.1.1 after 30 days, compared with the original booster’s 1.8-fold increase in antibodies against the same subvariant. The study assessed the immune responses in adults 55 years or older who had been previously vaccinated and boosted, regardless of infection history. 

    3. What if I had COVID this year? Does it matter when I get the booster?

    Most experts interviewed for this story say immunity can last anywhere from three to six months, though the official CDC recommendation is that the bivalent boosters should be given three months after a COVID infection or two months after an individual’s last shot. 

    “We used to say, just go ahead and get vaccinated as soon as you recover,” Dowd said. “But there has been subsequent evidence that suggests it’s a little better to probably wait at least three months. Not because it’s harmful to get it sooner, but you really won’t be getting much of the benefit of that boost. You reach a ceiling.”

    There are other considerations, as well. The timing of your last infection does matter if you have an idea what variants were circulating when you got sick. If you had an omicron infection last winter, you’re probably due for a booster. If you got sick within the past month or so, presumably with BA.5 or one of its subvariants, you may want to wait a month or two.  

    “As good as the vaccine is and as good as post-infection protection is, the immunity and protection wanes over time,” Dr. Anthony Fauci, chief medical advisor to President Joe Biden, told journalists at a White House briefing on Tuesday.

    You also have to assess your underlying immune status, whether you have medical conditions that put you at higher risk for severe disease, and how concerned you are about long COVID.

    “Most of the deaths that we’ll see from COVID could have been prevented if people stayed up to date with their boosters,” said the University of California’s Wachter. “And many cases of long COVID could [also] have been prevented if people stayed up to date with their boosters.”

    Finally, if you’re planning to spend Christmas with family or take a trip at the end of December, remember that it takes a few weeks to build up antibodies from the new shots. 

    4. Do I really need to get a booster if I’m young and healthy?

    We are long past the stage in the pandemic when the approach to vaccination was one size fits all, and not all medical experts think that people who are young and healthy need a booster right now.

    Dowd said that people who are “younger and in good health” can wait up to six months after a previous infection to get another shot.

    “If we go by the CDC data or the U.K. data, the people who seem to benefit from the boost fall into three categories: people who are immunocompromised, people who are elderly — mostly over 75 — and people who have high-risk medical conditions,” said Paul Offit, director of the Vaccine Education Center at Children’s Hospital of Philadelphia.  

    It’s unclear whether that thinking has influenced people’s decisions about whether to get a booster. But the bivalent shots have been available to children older than 5 years old and all adults in the U.S. for months, and that availability hasn’t led to much interest.

    “It’s for the same reason that 19,500 people pour into Wells Fargo Center [in Philadelphia] to watch the Sixers play, screaming their heads off, without a mask on,” Offit said. “They don’t feel compelled to get a booster dose.”

    That may be due in part to the fact that COVID hospitalizations and deaths have largely remained stable. There is no longer the kind of urgency that drove people to book appointments for the original vaccine or to wear masks. With the annual peak in COVID cases occurring during the first two weeks of January in 2021 and 2022, the question now is: Will that comfort level change as we get further into winter and the holiday season?

    “People want [a booster] to be like flipping a switch, like I’m 100% protected or not,” Dowd said, “but we know from the first couple of years that when the vaccine is well matched to the variants, which the BA.5 is a decent match right now, it really lowers transmission substantially and your chances of getting infected at all. We should take advantage of that.”

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  • The PC boom has gone bust, and we are about to see the results ahead of Black Friday

    The PC boom has gone bust, and we are about to see the results ahead of Black Friday

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    The pandemic-fueled personal-computer boom has ended, so how will that affect demand and pricing for PCs and the retailers that sell them this holiday season?

    A sense of the fallout will be provided in the week ahead with results due from PC makers Dell Technologies Inc.
    DELL,
    +0.67%

    and HP Inc.
    HPQ,
    +0.17%
    ,
    along with videoconferencing platform Zoom Video Communications Inc.
    ZM,
    -1.15%

    and electronics chain Best Buy Co Inc.
    BBY,
    +2.88%

    All of those companies will report amid signs of deep holiday discounting for products such as clothing and electronics, after many customers — stuck at home in 2020 and 2021 — loaded up on laptops and other goods and turned Zoom into a digital conference room. But this year, decades-high inflation, and a return to prepandemic spending on travel and hanging out in person, have forced retailers and electronics makers to adjust to a world where more people are spending on essentials.

    PC shipments have fallen at rates not seen since at least the 1990s. Adobe
    ADBE,
    -2.06%

    has said online holiday discounts for electronics have been as steep as 17%. For computers, they’ve run for as much as 10% less. TVs are also being sold for cheaper. Holiday-season forecasts have generally called for sales increases, helped by price increases and enduring demand despite those price increases.

    In-depth: The pandemic PC boom is over, but its legacy will live on

    However, results from Target
    TGT,
    +0.54%

    on Wednesday missed big on third-quarter earnings, and the big-box retailer said it was bracing for a possible decline in fourth-quarter same-store sales, citing “softening sales and profit trends that emerged late in the third quarter and persisted into November.” Results from Walmart
    WMT,
    +1.51%

    were almost the opposite, however, detailing earnings that beat by a wide margin and a raised full-year outlook.

    Among smaller retailers, discounter Ross Stores Inc.
    ROST,
    +9.86%

    hiked its full-year profit forecast, citing sales momentum but easier year-over-year comparisons up ahead. But Williams-Sonoma Inc.
    WSM,
    -6.15%

    noted “macro uncertainty” and “increasingly inconsistent” demand.

    This week in earnings

    The companies report during a shortened, quieter week — thanks to Thanksgiving — and after concerns about a recession have hung over much of the year. With 94% of S&P 500
    SPX,
    +0.48%

    companies having already reported third-quarter results, only a dozen are set to release earnings in the week ahead.

    But among those 94%, there are signs that preoccupations with a downturn might be easing, after the economy grew during the third quarter and reversed after two quarters of declines.

    FactSet senior analyst John Butters, in a report on Thursday, said 179 companies have mentioned the term “recession,” during earnings calls in the third quarter. That’s still above the average over 10 years, but it’s below the 242 companies that mentioned a recession in the second quarter.

    Previously: Executives seem pretty convinced a recession is coming

    Elsewhere on Monday, J.M. Smucker Co.
    SJM,
    +1.11%

    — best known for Folgers and Jif — reports results, following concerns about higher food prices and how much higher they might go. Life-sciences electronics maker Agilent Tecnologies Inc.
    A,
    +1.21%

    report results on Monday as well. Fast-food chain Jack in the Box Inc.
    JACK,

    reports Tuesday. Tractor and construction-vehicle Deere & Co.
    DE,
    +0.31%

    reports Wednesday, following production and supply-chain snarls but steady demand.

    The calls to put on your calendar

    Clothing demand, discount demand: Urban Outfitters Inc.
    URBN,
    +2.44%

    reports Monday, while Burlington Stores Inc.
    BURL,
    +4.63%
    ,
    Nordstrom Inc.
    JWN,
    +1.71%

    and dollar-store chain Dollar Tree Inc.
    DLTR,
    -0.21%

    report on Tuesday.

    The discounting wave across clothing retailers, an effort to clear inventories, might attract more consumers, but it’s worried Wall Street analysts focused on margins and the bottom line. Still, some analysts have said that more younger shoppers feel like their wardrobes are getting stale, and they say Nordstrom, whose customers tend to have more money, is best geared for “an upcoming wardrobe refresh.

    Off-price clothing and home-goods retailer Burlington, meanwhile, will report after rival discounters Ross and TJX received a lift from investors this week.

    See also: The holiday-shopping season has a different problem this year than last — and it could lead to some deals

    Ross’ chief executive, Barbara Rentler, noted that rising prices had hurt its lower-income consumers. But Jefferies analysts said that Burlington and other discounters, which often buy up goods that other retailers don’t want, stood to benefit from the inventory purge.

    Dollar Tree, meanwhile, reports as more shoppers seek cheaper grocery options, but as food prices rise nonetheless. But Bank of America analysts, in a note last month, said traffic data implied a “slowdown” heading into the results.

    The numbers to watch

    Demand trends for PCs, electronics: Dell and HP report in the wake of deeper job cuts across the tech industry, while Zoom tries to tack on more features — such as calendar and email functions — to appeal to small business and adapt to a hybrid-work world.

    The PC boom’s demise hit home at Dell during its prior quarter, reported in August, after personal-computer sales at the company came in below estimates. Executives, at that time, said PC demand had fallen and that “customers are taking a more cautious view of their needs given the uncertainty.”

    Opinion: Tech earnings are about to dive, and there’s no life preserver in sight

    Some analysts, however, signaled that some degree of investor pessimism was already baked into the stock prices.

    “We recognize the deteriorating industry fundamentals in relation to PCs as well as incremental slowdown in IT Infrastructure. That said, we believe the magnitude of the cuts last quarter set up Dell to be less exposed to another round of material earnings revisions,” JPMorgan analysts said in a note. And even as HP feels similar pain, analysts there said share buybacks could be “a bright spot.”

    Results from HP and Dell could also have implications for Best Buy, which sells laptops, TVs, phones and other electronic devices.

    “Recall that initial expectations for the year were that BBY would face pressure as it lapped stimulus-fueled spending and broad-based demand for technology products and services,” Wedbush analysts said in a note on Friday.

    “However, the macro has been more volatile than expected with consumers facing significant inflationary pressures and lower-income households are making decisions to trade down in some categories such as televisions.”

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