월스트리트저널 읽기 - Bond Yields, LVMH, Crypto Economy etc.

WEDNESDAY, OCTOBER 11, 2023

 

◈ High Bond Yields Likely to Extend Fed's Pause(높은 채권 수익률로 연준의 보류가 연장될 가능성이 있다)

 

 

A sustained rise in long-term Treasury yields could be bringing the Federal Reserve’s historic rate hiking cycle to an anticlimactic end.

 

Top central bank officials have signaled in recent days that they could be done raising short-term interest rates if long-term rates remain near their recent highs and inflation continues to cool.

 

The Fed in July raised its benchmark federal-funds rate to a range between 5.25% and 5.5%, a 22-year high. Officials held rates steady at their meeting last month and indicated they were on track to lift rates at one of their last two meetings this year.

 

The rise in long-term Treasury yields started after July’s Fed rate increase and gained steam after the September Fed meeting.

 

The 10-year Treasury yield closed at 4.654% on Tuesday, down from 4.783% on Friday, as investors sought the safety of bonds following Saturday’s attack on Israel by Hamas. Still, yields are up from 4.346% on Sept. 20, the day of the Fed’s last meeting, and 3.850% on July 26, the day of the last Fed rate increase.

 

The Fed raises rates to combat inflation by slowing economic activity, and the main transmission mechanism is through financial markets. Higher borrowing costs lead to weaker investment and spending, a dynamic that is reinforced when higher rates also weigh on stocks and other asset prices.

 

◈ China's Economic Woes Bruise LVMH(중국의 경제난으로 LVMH가 타격을 입다)

 

 

LVMH Moët Hennessy Louis Vuitton reported a sharp slowdown in sales growth as the world’s biggest luxury-goods company struggled to lure big-spending Chinese consumers back to its boutiques after the end of China’s pandemic restrictions.

 

The owner of Louis Vuitton and Dior said sales in its Asia market—which is dominated by China and excludes Japan— rose 11% over a three-month period ended on Sept. 30, stripping out the effects of currency fluctuations. That is down from a 23% rise in the first half of the year.

 

China’s economic woes spell trouble for LVMH and other luxury groups that built their business around the assumption that the country would continue to power the industry’s growth.

 

◈ PepsiCo Raises Outlook After 9% Sales Increase(펩시, 매출 9% 증가 후 전망 상향)

 

 

PepsiCo raised its full-year earnings outlook as consumers accepted higher prices and kept splurging on Cheetos, Lay’s and Gatorade.

 

The packaged-foods maker reported fiscal third-quarter revenue of $23.45 billion, up nearly 9% on an organic basis and above analysts’ expectations. Pricing and the mix of products sold lifted revenue 11%, while organic sales volumes slid 2.5%.

 

He said the pace of the company’s price increases will likely slow over the next year, and that some consumers are feeling the pressure of increased costs from higher interest rates and the resumption of college-loan payments.

 

“All of these things are certainly stressing those consumers to some degree,” Chief Financial Officer Hugh Johnston said. But for the majority of consumers, “they’re still buying our products at a good pace.”

 

◈ Tiny Homes Are the Next Big Thing for Homeowners(소형 주택은 주택소유자에게 다음으로 큰 관심사이다)

 

 

The latest amenity for homeowners is another, smaller home.

 

These add-ons are known as accessory dwelling units. They can be free-standing miniature homes as small as a studio apartment and tucked away in a backyard. They can reside above a garage or in a basement and extend to more than 2,000 square feet.

 

ADUs are growing in popularity as states encourage their construction through zoning changes and homeowners seek ways to lower their housing costs by renting out these units. The typical cost to construct one is around $100,000, according to building-permit data company Builty.

 

◈ Optimism on Rates Drives Up Stocks(금리에 대한 낙관론이 주가를 끌어올린다)

 

 

Stocks rose for a third straight session and bonds had their best day since August, after optimism built that the Federal Reserve’s campaign to raise interest rates is winding down.

 

The S& P 500 rose 0.5%, while the Nasdaq Composite gained 0.6%. The Dow Jones Industrial Average advanced 0.4%, or 135 points. Ten of the S& P 500’s 11 sectors rose, after all 11 closed higher on Monday.

 

Several top Fed officials have recently suggested that they could be done raising short-term interest rates if long-term rates remain near their recent highs.

 

The 10-year Treasury yield settled at 4.654%, down from 4.783% on Friday, marking the largest one-session drop since Aug. 23. The two-year yield fell to 4.982% from 5.077% on Friday, its lowest level since Sept. 8. Bond markets were closed Monday.

 

◈ Crypto Economy's Hope Is in Crisis(암호화폐 경제의 희망이 위기에 처했다)

 

 

Virtual currencies have found a purpose in games, but it has been undermined by rampant speculation

 

“What is it for?” is the essential question facing the cryptocurrency industry, including from regulators. Videogames have emerged as an answer—if only they could get rid of the speculators.

 

The continuing trial of Sam Bankman-Fried, founder of collapsed exchange FTX, is a reminder that crypto has turned into a big bet on itself rather than the alternative to traditional finance it once promised.

 

오늘도 경제신문으로 세상을 봅니다.

 

2023.10.10 - [경제신문 읽기] - 월스트리트저널 읽기 - Russia Oil Sanction, China Property, Oil Prices etc.

월스트리트저널 읽기 - Russia Oil Sanction, China Property, Oil Prices etc.