Customers shop at a supermarket in Foster City, California, the United States, Sept. 13, 2023.
Xinhua News Agency | Xinhua News Agency | Getty Images
This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.
What you need to know today
Fed ‘not far’ from rate cuts
Federal Reserve Chair Jerome Powell signaled the central bank is “not far” from the point of cutting interest rates. But in remarks to the Senate Banking Committee, Powell didn’t give a clear timetable for when the Fed will begin easing. “I think we’re in the right place,” the Fed chief said of the current policy stance.
Biden’s fiery State of the Union
President Joe Biden delivered a fiery State of the Union address fit for an election year that holds high stakes for a divided nation. He also laid out plans to reform the corporate tax system and lower costs for Americans, ahead of his likely rematch against former President Donald Trump.
SEA smartphone market booming
Research showed Southeast Asia’s smartphone market is booming so far this year, while China’s remained weak. The region’s top five markets saw 7.26 million smartphone units shipped, a significant 20% rise from the same period last year. This shows recovery for the region after the market slumped on the back of the pandemic.
[PRO] Goldman Sachs upside picks
Goldman Sachs highlighted the recent rally has pushed the share of market cap in stocks with “extremely high valuations” to levels seen during the “euphoria of 2021.” The bank remains bullish and picked stocks with over 30% upside potential in 2024, based on its latest price targets.
The bottom line
American CEOs are feeling a lot more optimistic about the economy.
The latest Business Roundtable’s report on CEO outlook jumped 11 points to 85 for the first quarter — above its historic average for the first time since 2022.
“This quarter’s survey results underscore the resiliency of the U.S. economy and suggest accelerating economic activity over the next six months,” said Business Roundtable Chair Chuck Robbins, who is also Cisco’s chief executive.
The report showed business leaders raised their economic growth estimates for this year — to 2.1% from 1.9% last quarter. And the growing confidence was reflected in CEOs’ business plans for the months ahead.
Expectations for sales rose 13 points, while the group’s index of capital spending also increased by 16 points. Plans for hiring ticked up a modest 5 points.
The findings dovetail the latest economic outlook in the U.S. Beige Book, a Federal Reserve survey. It also highlighted the economy picked up pace slightly in early 2024.
“The outlook for future economic growth remained generally positive, with contacts noting expectations for stronger demand and less restrictive financial conditions over the next 6 to 12 months,” it said.
Inflation pressures haven’t really gone away, the survey added, underlining businesses found it harder to pass their own higher costs onto customers, “who became increasingly sensitive to price changes.”
Still, Fed Chair Jerome Powell on Thursday noted inflation is “not far” from where it needs to be for the central bank to start lowering interest rates.
This just adds to the overall confidence that rate cuts are coming, even if the timing remains uncertain.