Before the bell: the barrel is empty, and no more coffee

Last U.S. rate decision of the year, Japanese rumor mill in overdrive, and OpenAI challenges Alphabet.

While European stocks were mostly stagnant yesterday, the Bel20 dropped 0.6%, dragged down by heavyweight AB InBev (-2%). At 49.57 euros per share, the beer giant closed at its lowest point in over a year. In the U.S., the S&P 500 and Nasdaq slipped 0.4% and 0.3%, respectively. Chipmaker Broadcom, which had seen its stock rise 33.5% over five days, took a breather and ended the day 3.9% lower. Meanwhile, Pfizer gained 4.7%, proudly announcing it would meet analysts’ projections for 2024 despite earlier criticism from activist investor Starboard Value.

This morning in Asia, the Topix in Tokyo remained flat, while Hong Kong’s Hang Seng Index climbed 0.7%. In the U.K., sandal maker Birkenstock will report its earnings today, and in the U.S., food producer General Mills will release results before the market opens. After-hours, memory chipmaker Micron Technology is set to publish its earnings. The U.S. Federal Reserve is expected to cut interest rates by 0.25% today.

Word on the street

Rumors are swirling about a potential merger between Nissan and Honda. The Japanese automakers, facing pressure from rapidly growing Chinese electric vehicle manufacturers, are reportedly exploring the feasibility of a merger. Together, the two companies would boast a market value exceeding 50 billion dollars. Earlier this year, they announced plans to collaborate on electric vehicles. While Honda shares have declined 14% since January, Nissan’s have plummeted by 40%. However, a merger might not sit well with the Japanese government, as it could lead to significant job losses in the sector. Nissan shareholders seemed optimistic, sending the stock up 23.7% in Tokyo this morning. Honda shares, on the other hand, fell 3.7%.

Coffee gets pricier

Bad news for coffee lovers: the price of coffee, often called “morning gold,” has surged more than 70% in U.S. dollars since the start of 2024, marking the highest price in over 50 years. Coffee growers worldwide have been grappling with extreme weather conditions all year. Brazil, which accounts for nearly 40% of global coffee production, has faced severe droughts, while Vietnam, responsible for 17%, has endured multiple typhoons. Producers like JDE Peet’s will likely have to raise their prices. Retailer Colruyt, known for its tough stance with suppliers, temporarily halted all orders from JDE Peet’s. Unsurprisingly, the Dutch coffee giant’s stock dropped over 6% yesterday and has lost more than 30% this year. Starbucks, meanwhile, has seen its stock stagnate in 2024, underperforming the average American stock, which is up 27.5%.

Did you know…

ChatGPT’s search function will soon be available to all users? Even free users of the popular AI chatbot will gain access to the feature, as OpenAI sets its sights on competing with Google.

This article was translated from Dutch and was originally published on Spaarvarkens.be.