Wall Street Breakfast

Labour by a landslide

Labour wins U.K. election by a landslide (0:22). Bitcoin slumps below $58K (1:15). Honda and Nissan eye collaboration (1:50). June nonfarm payrolls expected to reflect softening labor market (2:20).

Show Notes:
Bitcoin slumps below $58K for the first time in two months
Labour wins U.K. election, sweeping to power by a landslide
Automakers Honda and Nissan eye collaboration on software and EV charging

Episode transcripts: seekingalpha.com/wsb

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Duration:: 4m
Broadcast on:: 05 Jul 2024
Audio Format:: mp3

(upbeat music) - Good morning, today is Friday, July 5th. I'm Rina Sherbel filling in for Julie Morgan. U.S. markets were closed yesterday on the count of July 4th, the U.S. Independence Day. And as of today, 14 years of conservative rule have ended in the U.K. after the labor party won the general election by a landslide with Keir Starmer becoming the new prime minister. He's been given a major mandate with 408 seats out of 650 in parliament, picking up 209 seats in the latest vote according to the last exit polls. With net debt nearly equivalent to annual economic output, labor has pledged to plug a shortfall in public spending, but will need to find new funds to turbocharge the economy and the national healthcare service. It has also outlined supply side reforms, like making infrastructure easier and cheaper to build, as well as investing in green energy and a new deal for working people. In terms of trade, Starmer has ruled out rejoining the EU Single Market or Customs Union, though he will seek ways to remove some of the trade barriers with the block. Bitcoin slumped below 58,000 on Thursday for the first time since early May, and concerns of Mt. Gox distributing a large amount of BTC to its creditors. The German government also moved its stash of BTC to crypto exchanges. Lucy Hu, senior analyst at MetaAlpha, said among the top reasons for the price drop was the German government moving more than 50 million to crypto exchanges, creating cell speculation in the market. Earlier in the day, BTC had also dropped below the 200-day moving average. Honda Motor and Nissan Motor are in talks to jointly develop operating systems and other automotive software in an effort to reduce costs. Nikhai reported on Thursday, the two Japanese automakers could also work together to bolster charging infrastructure to boost their competitiveness in electric vehicles, the report noted. Due before the opening bell, the US Department of Labor's non-farm payrolls report for June is likely to be a mixed bag, with growth expected to continue, but at a slower pace than in prior months. The data are likely to continue to exhibit growth according to economist expectations. This would follow a pickup and job growth seen in the previous month, with non-farm payrolls climbing by 272,000 in May. That figure outpaced the 182,000 expected and 165,000 posted in April. Stock index futures traded with caution on Friday, as investors keep their eyes peeled for a key jobs report a day after the markets return from the 4th of July holiday. S&P 500 futures were flat, NASDAQ 100 futures were up 0.1% and Dow futures were as well. The 10-year treasury yield was down three basis points to 4.35%. The two-year yield was down three basis points to 4.7%. Deutsche Bank's Jim Reed said, "The main event to look out for today is the US jobs report for June. That will be a particularly interesting one as the June survey data we've had so far has been weaker than expected, with both the ISM manufacturing and services prints in contractionary territory. The June non-farm payrolls report is anticipated to show a decline to 191,000. The unemployment rate is forecasted to stay at 4%. One of Friday's biggest stock movers is Macy's. Shares rose 3% after an investor group, led by Archhouse Management and Brigade Capital Management, up their takeover bid for the second time to $24.80 per share, valuing the company at about $6.9 billion, according to sources familiar with a matter cited by the Wall Street Journal. This revised proposal targets acquiring Macy's shares, not already owned by the investor group, following rejections of their prior offers of $24 in March and $21 in December. Other events to look for on today's economic calendar. At 1 p.m., we have the Baker Hughes rig count. At 4.30 p.m., we have the Fed balance sheet. And as we mentioned, look for that employment situation to come out at 8.30 a.m. That's it for today. Enjoy your weekend. Look for links for stories in the show notes section. Don't forget, these episodes will be up with transcriptions at seekingalpha.com/wsme. And join the elite community of real investors to unearth great investing ideas. Just head to seekingalpha.com/subscriptions. [BLANK_AUDIO]