5 Things You Need to Know to Start Your Day

Good morning. Questions are swirling about the recent rally in stocks, emerging markets are surging and real estate is facing a cold new rea [View in browser]( [Bloomberg]( Good morning. Questions are swirling about the recent rally in stocks, emerging markets are surging and real estate is facing a cold new reality. Here’s what’s moving markets.  —[David Goodman]( Stock gains questioned [Questions are swirling]( about the recent rally in US stocks, after the S&P 500 had its strongest close since August and the Nasdaq 100 hit a 22-month high yesterday. Goldman Sachs strategists said there is a risk of “disappointment in the near term” amid lingering concerns about economic growth and inflation, while Citigroup warned of the possibility of a short squeeze that could derail the rally. US equity futures were little changed on Tuesday. The day’s main economic event comes in the form of minutes of the Fed’s latest meeting, before Wednesday sees a flurry of data prior to the Thanksgiving holiday. Emerging rally Still, the gains for US stocks, plus a weaker dollar and falling Treasury yields, helped emerging-market [stocks and currencies extended gains on Tuesday](. MSCI’s index of developing-nation stocks climbed to the highest level in almost three months, led by technology companies, while the gauge for currencies soared to a 22-month high. Elsewhere, oil pared a a two-day advance. OpenAI latest The OpenAI[saga is continuing]( as the firm races to quell a potential mutiny among staff. Investors are still trying to return co-founder Sam Altman to a leadership role at the ChatGPT maker, and Microsoft has signaled that it wouldn’t oppose such an outcome. Thrive Capital, Khosla Ventures and Tiger Global Management are looking to protect their investment after the OpenAI board forced out Altman on Friday, Dina Bass, Emily Chang and Ashlee Vance report. Microsoft shares climbed 2.1% yesterday and were marginally higher in pre-market trading today. Real estate reality One market that is really feeling the heat at the moment is real estate. Ari Altstedter, Ainsley Thomson and Prashant Gopal write today that investors there are facing a cold new reality — the [bonanza that fueled wealth for millions of people is over.]( As they explain, markets around the world are caught between sharply higher borrowing costs — likely here to stay — and a shortage of homes that's keeping prices elevated. That’s upending markets from the US, which is effectively frozen by low rates — to longtime boom areas like New Zealand and Canada, where values haven’t fallen meaningfully for househunters, while those who paid peak prices struggle under costly mortgages.  Treasuries’ triumph Finally, it looks like a wild year for Treasuries [could have a happy ending]( after a rally in securities left them in the green for the year. The Bloomberg US Treasury Index, which tacks the $26 trillion market, is now back about where it ended 2022. It was down as much as 3.3% earlier in the year, but slowing inflation and signs that the labor market is cracking encourage traders to bet that the Fed is done with hiking interest rates. While the evidence of impact of climate change on everyday life appears to pile up, enthusiasm for green energy stocks remains weak, and concerns emerge about the strength of demand for electric vehicles. What's your outlook for renewable energy and EV makers like Tesla? Share your views in the latest [MLIV Pulse survey](. What We’ve Been Reading This is what’s caught our eye over the past 24 hours. - Traders [aren’t buying Bailey’s warning](on higher BOE rates. - Several [senior traders are departing Citigroup]( amid a restructuring. - Hamas says Gaza hostage talks progress and [could yield ‘truce’]( - Chinese [property bonds, shares jump](on funding support plan. - Carlyle exits China McDonalds stake with[6.7 times return](. - [A new front is opening up]( in the US-China conflict over chips. - T[he long shadow of Steve Jobs]( looms over the turmoil at OpenAI. And finally, here's what Joe’s interested in this morning Most people don't have any direct stake in the OpenAI drama. But the story is so big and bizarre, it's hard not to be fascinated by how it's gone down, and curious about how it will end up. In addition to all the [great reporting]( on the story going on, I've become glued to the various prediction markets out there, where people bet real or fake money on the outcome. [Here's a contract on PolyMarket](, where right now bettors see Sam Altman as having a 55% chance of returning as CEO by the end of 2023. [Here's a market on Kalshi]( that's trading at 59. [Here's a market on Manifold](, which doesn't use real money, where he's at 43%. Needless to say, there's some variation in the markets, and none are similar enough or liquid enough or fungible enough to arbitrage the differences. All that being said, if you forget that these are referred to as "prediction markets" and just think of these prices as a gauge for where conventional wisdom of people engaged in the story are right now, they're kind of useful to watch. What you can say for sure, is that right now a lot of people across a variety of places where there's some skin in the game think there's a substantial chance Sam ends up back as the CEO OpenAI. Maybe somewhere around a coin flip right now. Just from an information consumption standpoint, this is a useful addition to following the news stories. Will the market be right? It's kind of missing the point. Markets are often getting things "wrong". Just look at the huge jump in certain Argentine shares over the last two days, with the victory of Javier Milei. Clearly the outcome caught markets by surprise, given the magnitude of the move. The ARGT ETF surged over 11% in yesterday's trading. So rightness or wrongness is not really what it's about, but rather gauging where people's heads are at right now. Until this OpenAI drama ends, I'll probably be refreshing those links a lot just to get a sense of the vibes. Joe Weisenthal is the co-host of Bloomberg’s Odd Lots podcast. 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