Important News Items for Investors to Start Their Trading Day

1. New year, new markets

2. Waiting on economy to evolve

The Federal Reserve indicated that it is not yet ready to cut rates, stating that interest rate cuts are likely to occur in 2024. However, the specific timing of these cuts remains uncertain. In the minutes released from its latest meeting, the Fed mentioned that it expects three quarter-percentage-point cuts by the end of 2024, citing subsiding inflation concerns. Despite this, the Fed expressed caution and highlighted the possibility of keeping rates high if the necessary conditions are not met. The release also emphasized the elevated level of uncertainty regarding the policy path, with future decisions depending on the evolution of the economy.

3. Kicking it up a gear

General Motors (GM) achieved its best year for vehicle sales since 2019, reporting the sale of 2.6 million vehicles in 2023. This represents a 14.1% increase compared to 2022 and aligns with industry expectations. However, GM’s electric vehicle (EV) sales were disappointing, accounting for only 2.9% of total sales last year, with the majority being now-discontinued Chevrolet Bolt models. To address this, GM plans to increase its EV production in 2024 and offer incentives worth $7,500 for models that no longer qualify for federal tax credits of the same amount.

4. Oil prices

Oil prices surged over 3% on Wednesday due to heightened tensions in the Red Sea. The United States issued a warning to Houthi militants, backed by Iran and based in Yemen, to cease attacks on vessels in the region. To avoid the risk of conflict, carriers have redirected over $200 billion worth of trade away from the Red Sea. Additionally, protests in Libya resulted in the shutdown of the Sharara oilfield, which produces 300,000 barrels per day, impacting oil prices further.

5. Xerox cuts

Xerox plans to reduce its workforce by 15% in the current quarter, affecting approximately 3,075 employees out of a total of 20,500. The company, known for its digital printing and document management technology, also intends to implement a new organizational structure and operating model. This includes the redesign of its executive team and the simplification of its product offerings. Following the announcement, Xerox stock experienced a decline of more than 12% on Wednesday.