1. Fed Plans Three Rate Cuts in 2024;
2. BlackRock Launches $400 Million ETF;
3. US 30-Year Mortgage Rates Drop Below 7%;
4. Analysts Bearish on 2024 Consumer Spending;
5. US EV Inventories Hit Record High;
6. Whitney Museum to Offer Free Admission;
7. Global Payments May Acquire Shift4.
1. Fed Plans Three Rate Cuts in 2024
On Wednesday, the Federal Reserve held a key policy meeting and delivered its clearest “dovish” signal yet, projecting up to three rate cuts in 2024.
Markets around the world surged following the announcement, with the S&P 500 climbing close to its all-time high—marking the biggest rally in two years.
According to Bloomberg, traders across asset classes cheered the end of monetary tightening, as inflation is no longer seen as the Fed’s top concern.
Investors are now betting on six 25-basis-point cuts in 2024, double the Fed’s own forecast. Goldman Sachs economists predict the first rate cut could come as early as March.
The Fed believes the current economic landscape is much better than in recent months, and a soft landing appears increasingly likely.
______
2. BlackRock Launches $400 Million ETF
Today, BlackRock launched its new $400 million Total Return ETF, trading under the ticker BRTR.
The ETF charges a 0.38% management fee and invests in a range of fixed income assets.
The fund is actively managed by a team led by Rick Rieder, BlackRock’s CIO of Global Fixed Income. Just seven months ago, his team launched the $413 million BlackRock Flexible Income ETF (ticker: BINC).
While BlackRock remains the world’s largest ETF issuer, it only recently began entering the actively managed ETF space. This year, Tony DeSpirito, BlackRock’s CIO of Global Fundamental Equities, also plans to launch an ETF.
Currently, just 36 of BlackRock’s 400+ ETFs are actively managed.
______
3. US 30-Year Mortgage Rates Drop Below 7%
Freddie Mac announced today that the average 30-year fixed mortgage rate fell to 6.95% last week, down from 7.03%. It marks the first time in four months that rates have dropped below 7%, easing pressure on homebuyers.
Chief Economist Sam Khater said inflation is cooling significantly, and with the Fed expected to cut rates multiple times next year, mortgage rates could continue to decline—potentially drawing more buyers into the market.
Rates have now declined for seven straight weeks, after peaking at 7.79% in October.
______
4. Analysts Bearish on 2024 Consumer Spending
Wall Street analysts are skeptical that US consumer spending can remain strong in 2024. Over the past 12 weeks, sell-side analysts have lowered Q1–Q3 profit forecasts for consumer discretionary companies, citing slowing income growth.
In a note to clients, analysts said corporate profit margins may hold, but weakening consumer demand could begin to drag down revenue.
Thanks to companies like Tesla and Amazon, the S&P 500’s consumer discretionary index has surged 40% this year—outpacing the broader S&P 500’s 23% gain.
October retail sales data already showed signs of weakness, with real spending growth below expectations.
______
5. US EV Inventories Hit Record High
According to a blog from auto research firm Cox Automotive, US electric vehicle inventories at dealerships hit an all-time high in December.
At current sales rates, it would take 114 days to clear EV inventories—up from 53 days last year and above the overall industry average of 71 days.
Consumers remain concerned about EV prices and inadequate charging infrastructure. This week, Ford told suppliers it would cut 2024 production of its F-150 Lightning electric pickup in half. GM has also delayed several new EV models.
As of the end of November, the Ford Mustang Mach-E had the highest backlog, with inventory covering 284 days of supply.
______
6. Whitney Museum to Offer Free Admission
Starting January 12, the Whitney Museum of American Art in New York will offer free admission every Friday from 5 p.m. to 10 p.m. Additionally, beginning January 14, it will waive admission one weekend evening per month.
In recent years, many NYC museums have raised ticket prices—The Met now charges $30 for adults, with the Guggenheim and MoMA following suit.
Whitney’s new director, Scott Rothkopf, said many visitors are young and come from diverse backgrounds. Free admission nights are designed to make the museum more accessible—one of his early initiatives as director.
Whitney trustee Carolina Herrera and her husband donated $1 million to fund the Friday night program.
______
7. Global Payments May Acquire Shift4
Sources revealed that Global Payments, based in Atlanta, is working with advisors to explore acquiring rival payment processor Shift4 Payments.
Following the news, Shift4 shares surged as much as 13% and were still up 6.3% by 3:44 p.m., while Global Payments shares fell 3.3%.
Global Payments and Shift4 are key players in the digital economy, offering technology that connects merchants, consumers, and banks—earning transaction fees in the process. They were among the biggest winners during the pandemic e-commerce boom.
Shift4, which went public in 2020, processes over $200 billion in annual payments.
______
This content is sourced from Financial Times, Bloomberg, and The Real Deal, among other financial news outlets.