The Day at a Glance | November 13 2024

The Top

• In the US, CPI inflation stood at 2.6% in October.

• On Wednesday, President Joe Biden will welcome President-elect Donald Trump to the White House in a meeting intended to demonstrate a smooth transition between administrations, despite Trump’s team not yet having signed documents to initiate the handover process.

• On Wednesday, Francois Villeroy de Galhau, head of the Bank of France and a member of the ECB, said that Donald Trump’s economic agenda risks bringing inflation back to the US and harming global economic growth.

• Catherine Mann, a member of the Bank of England, noted that high inflation in Britain has not been defeated and is likely to exceed central bank forecasts in the medium term.

• Brazil’s services sector activity grew more than expected in September, reaching a record level, signaling economic strength following the central bank’s start of a monetary tightening cycle to combat inflation.

• Oil prices fluctuated slightly and were trading near their lowest level in two weeks on Wednesday, a day after OPEC downgraded its forecast for global oil demand growth in 2024 and 2025.

Economic Environment

In the US, CPI inflation stood at 2.6% in October. The Bureau of Labor Statistics (BLS) released consumer price index (CPI) inflation figures for October, showing a 0.2% month-over-month increase on a seasonally adjusted basis. The housing category rose by 0.4% month-over-month, accounting for half of the monthly increase in the entire CPI index. Year-over-year CPI inflation reached 2.6% in October, setting in line with our expectations and the market consensus forecast, after a 2.4% rise in September, based on original figures. Core inflation, which excludes energy and food, rose by 0.3% month-over-month in October, consistent with the 0.3% monthly increases in August and September. On an annual basis, core inflation stood at 3.3% in October. CPI inflation figures showed a slight uptick in the overall index due to base effects from last year; however, core inflation remains high with a sideways trend since mid-year. Nonetheless, the market expects the Federal Reserve to cut the federal funds rate by 25 basis points on December 18^th. 

Markets and Companies

US futures are up after October´s inflation data was released; consumer prices rose slightly, in line with expectations. The 10-year Treasury yield fell about 4 basis points to 4.394%, while the 2-year Treasury yield dropped around 5 basis points to 4.294%. In Europe, markets are mostly down. The Stoxx 600 was down 0.5% at 1:00 p.m. London time, with most sectors in negative territory. Similarly, Asian markets closed mostly lower, tracking losses on Wall Street as the US postelection rally stalled overnight.

Regarding commodities, oil prices held near their lowest level in two weeks on Wednesday, a day after OPEC downgraded its forecast for global oil demand growth in 2024 and 2025, amidst rising demand concerns in China. Metals are up, and cryptocurrencies are down. In Mexico, IPyC futures are up +0.38%. 

The exchange rate stands at 20.47 after closing at 20.59 yesterday.

The National Association of Supermarkets and Department Stores (ANTAD for its acronym in Spanish) reported October´s sales results. In October, nominal same-store sales (SSS), which include those with more than one year of operation, recorded an increase of +1.7%. For total stores, which cover both existing and newly opened stores over the past 12 months, growth was +4.3% compared to the same period last year.

Corporate News

• Cava shares rose nearly 19% after third-quarter results exceeded analysts’ expectations.

• Spotify shares climbed 8% after its fourth-quarter earnings forecast topped analysts’ estimates. Spotify’smonthly active users in the third quarter totaled approximately 640 million, up 11% from the previous year and above the 639 million analysts had forecast.