Treasuries Decline Following Powell’s Remarks; Mixed Outcomes in Global Stocks

Following Federal Reserve Chair Jerome Powell’s remarks countering expectations of imminent rate cuts, bond yields have risen and the dollar has strengthened. This shift in the market began after last Friday’s impressive jobs report, with US 10-year yields increasing by nine basis points to 4.11%. Bond yields from Australia to Germany also experienced a rise. The Bloomberg Dollar Index approached a two-month high, while oil prices saw a decline.

In the global stock market, the response was varied. US S&P 500 futures showed a slight decrease, whereas European stocks received a boost, partly due to strong earnings reported by Italian bank UniCredit SpA.

Corporate Highlights:

• Estee Lauder, (EL), saw its shares jump 19% in premarket trading following the announcement of a workforce reduction plan of 3% to 5% as part of a restructuring initiative. Additionally, the beauty giant raised its sales forecast for the fiscal year.
• Caterpillar Inc. (CAT), displayed resilience against global economic slowdown concerns, with increased sales in its energy and transportation sector in Q4. This led to profits surpassing analysts’ expectations, resulting in a 3.2% rise in its shares in premarket trading.
• Novo Nordisk A/S’s, (NOV), shares went up by as much as 2.6% after the company’s decision to acquire three manufacturing plants for $11 billion. This move aims to cater to the growing demand for its obesity drug Wegovy and diabetes medication Ozempic. The acquisition is from Novo Holdings A/S, which recently agreed to purchase Catalent Inc. (CTLT), the owner of the assets, in a deal valued at $16.5 billion.