Dow edged up 34, decliners over advancers 5-2 & NAZ finished 40 higher. The MLP index remained steady in the 253s & the REIT index fell 6+ to the 342s. Junk bond funds drifted lower & Treasuries saw heavy selling bringing higher yields. Oil was fractionally higher to go over 81 & gold dropped 12 to 1986 (more on both below).
AMJ (Alerian MLP Index tracking fund)
![Live 24 hours gold chart [Kitco Inc.]](https://www.kitco.com/images/live/gold.gif?0.2180338269244485)
OpenAI announced its new, more powerful GPT-4 Turbo artificial
intelligence model during its first in-person event & revealed
a new option that will let users create custom versions of its viral
ChatGPT chatbot. It's also cutting prices on the fees that companies &
developers pay to run its software. OpenAI's announcements show
that one of the hottest companies in tech is rapidly evolving its
offerings in an effort to stay ahead of rivals in the AI arms race. OpenAI said more than 92% of Fortune 500 companies use
the platform, up from 80% in Aug. The event also included a surprise appearance by Microsoft (MSFT), a Dow stock, CEO Satya Nadella. “The
systems that are needed as you aggressively push forward on your road
map require us to be on the top of our game, and we intend fully to
commit ourselves fully to making sure you all... have not only the best
systems for training and inference, but also the most compute,” Nadella said. He added, “That’s the
way we’re going to make progress.” Earlier this year MSFT's expanded investment in OpenAI — an additional $10B — made it the biggest AI investment of the year, according to PitchBook & in Apr, the startup reportedly closed a $300M share sale at
a valuation between $27-29B, with investments from
firms such as Sequoia Capital & Andreessen Horowitz. As recently as
last month, OpenAI was reportedly in talks to close a deal that would lead to an $80B valuation. The stock rose 3.73.
If you would like to learn more about MSFT, click on this link:
club.ino.com/trend/analysis/stock/MSFT_aid=CD3289&a_bid=6aeoso5b6f7
Microsoft-backed OpenAI announces GPT-4 Turbo, its most powerful AI yet
When Citigroup (C) CEO Jane Fraser announced in Sep that her sweeping corp overhaul would result in an undisclosed number of layoffs, a jolt of fear ran through many of the bank's 240K souls. “We’ll be saying goodbye to some very talented and hard-working colleagues,” she warned. Employees'
concerns are justified. Managers & consultants working on Fraser's
reorganization, known internally by its code name, “Project Bora Bora,” have discussed job cuts of at least 10% in several major businesses,
according to people with knowledge of the process. The talks are early & numbers may shift in coming weeks. Fraser is under mounting
pressure to fix Citi, a global bank so difficult to manage that its
challenges consumed three predecessors dating back to 2007. Already a
laggard in every metric
that matters to investors, the bank has fallen further behind rivals
since Fraser took over in early 2021. It trades at a price-to-tangible
book value ratio of 0.49, less than ½ the average of US peers & 1/3 the valuation of top performers including JPMorgan Chase (JPM). If Fraser decides to part with 10% or more of her
workforce, it would be one of the deepest rounds of dismissals
in years. Burdened by regulatory demands that hastened the retirement of her predecessor Mike Corbat, Citi's expenses & headcount have ballooned under Fraser. While competitors have been cutting jobs
this year, Citi's staff levels remained at 240K. That leaves
Citi with the biggest workforce of any American bank except the
larger & far more profitable JPM. An update on Fraser’s plan & its financial impact will come in Jan along with 4th-qtr earnings. The stock fell 22¢.
If you would like to learn more about Citi, click on this link:
club.ino.com/trend/analysis/stock/C_aid=CD3289&a_bid=6aeoso5b6f7
A growing number of older adults have no plan beyond Social Security to fund their retirement, a recent survey said. One in 5 adults age 50 or older said they have no source of retirement income besides Social Security, up from 13% in 2014, the Nationwide survey said. A decade ago, 48% of respondents in this age group said they had a pension in addition to Social Security, compared to just 31% in 2023, the survey added. The growing reliance on Social Security comes as an increasing number of respondents said they were doubtful that they would receive their full benefits, according to the survey. Nationwide said 75% of adult respondents aged 50 or older believe Social Security will run out of funding in their lifetime, up from 66% in 2014. Moreover, only 8% of respondent understood how to maximize their Social Security benefits. However, only 8% correctly identified all the listed factors determining the maximum Social Security benefits an individual can receive. "Nearly four out of five Americans say that the Social Security system needs to change, while at the same time our research shows that most people don't understand how the current system works," Tina Ambrozy, Nationwide senior VP of strategic customer solutions said. "Social Security is a complex system, and it can be difficult to know what you are entitled to. The past ten years of research have been about providing insights to aid that effort, and while we have made notable progress, we still have work to do."
Social Security income is central to growing number of retirement plans
Gold prices fell on rising treasury yields & profit taking. Gold for Dec closed down $10 to settle at $1988 per ounce. The drop comes as investors take profits after safe-haven buying following the Oct 7 terror attacks by the Hamas militant group that murdered hundreds of Israeli citizens & Israel's subsequent invasion of Gaza. The metal rose to a 3-month high last week as investors turned to the safety of the metal while the $ weakened on expectations the Federal Reserve is turning dovish & will no longer raise interest rates to slow inflation. Gold is currently being weighed down by profit taking from speculators who recently bought a near record amount in the futures market. Treasury yields rose, bearish for gold since it offers no interest. The 2-year note was last paying 4.912%, up 3.7 basis points, while the yield on the 10-year note was up 14.3 basis points to 4.662%. The $ edged higher, with the ICE dollar index last seen up 0.11 points to 105.13.
Gold Prices Ease on Profit Taking and Higher Treasury Yields
West Texas Intermediate (WTI) crude oil closed higher after Saudi Arabia & Russia confirmed they will continue voluntary production cuts thru year end. WTI crude for Dec closed up 31¢ to settle at $80.82 per barrel, while Jan crude, the global benchmark, was last seen up 40¢ to $85.29. The rise came as Saudi Arabia confirmed, as expected, it will extend its voluntary production cut of 1M barrels per day thru year end, while Russia said it will continue with a 0.3M bpd cut over the period as well. Oil has surrendered a war premium attached to the commodity following the Oct 7 terror attacks by the Hamas militant group that murdered hundreds of Israeli civilians & foreign nationals. After rising to as much as $89.37 on Oct 20, West Texas Intermediate has since fallen back as worries over a spreading Middle East ease. Demand concerns have come to the fore, as US inventories rise, while weak economic data comes as high interest rates slow the US economy.
WTI Crude Oil Rises as Saudi Arabia and Russia Confirm Production Restraint to Continue Through December
Last week was the best week for the stock market in 2023. Today was a time to rest & some traders took profits. Trading was choppy & the Dow stayed close to breakeven for the entire session. The economic background continues to be uncertain & 2 major wars on the globe add to uncertainty, something investors don't like.
Dow Jones Industrials
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