5 Things You Need to Know to Start Your Day

Good morning. Traders are rushing to bet on interest-rate cuts around the world, driving an everything rally again. Wall Street CEOs will lo [View in browser]( [Bloomberg]( Good morning. Traders are rushing to bet on interest-rate cuts around the world, driving an everything rally again. Wall Street CEOs will lobby for watered-down regulation and Nvidia says it has a formidable rival in China. Here’s what people are talking about. —[ Sofia Horta e Costa]( Rate-cut race Rate-cut bets are filtering through global markets. In Europe, traders are now [fully pricing in]( six quarter-point rate cuts by the European Central Bank in 2024 for the first time. If traders are right, the ECB would be the first among major central banks to cut rates next year, followed by the Fed’s first move lower in May. In the UK, markets are pricing three Bank of England cuts starting in June. Bitcoin [is trading close to $44,000]( after notching its longest winning streak since May, a rally driven in part by expectations of looser monetary policy. Gold is [edging up again](after a two-day slump from its record high, while US stock-index futures are in the green. An index of sovereign debt that excludes Treasuries has now [surged to the highes](t since April 2022. Wall Street appeals CEOs of some of the biggest banks on Wall Street, including JPMorgan, Citigroup, Goldman Sachs, Morgan Stanley and Bank of America, are [expected to testify]( on regulatory oversight to the Senate banking committee. They’ll [make their case]( for watering down new rules, [unveiled]( in July by the Federal Reserve and other regulators, that would require big banks to increase their capital cushion by almost 20% to ensure they can survive another crunch. Regulators say the changes can help avoid [turmoil]( such as this year’s meltdowns of midsize banks. JPMorgan CEO Jamie Dimon plans to say the rules will [drive up]( interest rates for some first-time homebuyers as well as underserved and low-to-moderate-income borrowers. Formidable rivals China’s Huawei, Intel and a number of chip startups are among a growing field of “very formidable” [competitors to Nvidia](, CEO Jensen Huang told reporters in Singapore earlier on Wednesday. China has historically accounted for about 20% of Nvidia sales but US barriers on the sale of the company’s chips to its economic rival are posing a challenge. Huang said Nvidia will deliver a new set of products for the Chinese market that’s in line with the latest trade rules from Washington. Earlier this month, Commerce Secretary Gina Raimondo [pitched for more funding so her department]( could stop China from gaining access to the most advanced semiconductors, saying “we cannot let China get these chips. Period.”  China’s government is increasingly relying on Huawei — the company Washington tried to destroy — to lead its efforts to build a [semiconductor powerhouse](. Record revenue The airline industry is booming. Globally, [carriers are set to generate a record $23.3 billion this year](, says IATA, more than double what the trade body [expected in June](and a near quintupling of its outlook at the start of the year. Business growth will continue in 2024 but moderate as the industry moves on from its post-pandemic recovery. IATA predicts 4.7 billion people will travel in 2024, exceeding the 4.5 billion figure recorded in 2019. But US airlines, especially those focused on domestic travel, [are having a tough year](due to grounded or delayed aircraft, rising labor costs, volatile fuel prices, and congestion magnified by a shortage of air traffic controllers. Analysts expect US domestic carriers to struggle financially in 2024 and possibly 2025. Coming up… Aside from lobbying from Wall Street CEOs, today we’ll get the ADP’s November private payrolls report, which could either reinforce Fed rate-cut bets or confuse investors [after Tuesday’s weaker-than-forecast JOLTS data](. Reports on US trade for October as well as weekly mortgage applications are also due later today. Will American exceptionalism prevail in markets next year, allowing the S&P 500 to outperform? Click on the image below to share your views. What we’ve been reading This is what’s caught our eye over the past 24 hours. - Amazon is [cutting fees]( for merchants selling clothing priced below $20. - If Trump weren’t running, Biden[ may have skipped]( the 2024 elections. - Putin has arrived in the UAE [in a rare trip abroad](for the Russian leader. - Companies are going [broke gradually, not suddenly](, writes John Authers. - More US smokers [are quitting, going cheaper]( or adopting alternatives. - India’s stock market is [worth $4 trillion]( for the first time in history. - Researchers are looking at whether Wegovy [can fight alcoholism](. - A Belgian city considers building a skyscraper[ on top of a skyscraper](. And finally, here's what Joe’s interested in this morning As an appetizer ahead of Friday's jobs report, yesterday we got the latest JOLTS survey, which showed further cooling in the labor market. The number of job openings came in well below expectations at 8.73 million. The previous month was revised down as well. That being said, as seen on the chart, the rate of quits held steady at 2.3% for the fourth straight month. What's interesting, too, is that 2.3% is basically where the quits rate spent all of 2018 and 2019. So at least by one measure, we're seeing complete normalization. And arguably this is the more important measure. Quits are a sign of labor market confidence (you don't typically quit your job without good prospects elsewhere). Job openings are easy to list and don't necessarily signal so much. That being said, at least in the past we know that openings were a key indicator for the Fed, so to see them slide is important. Anyway, for now there's nothing here that's inconsistent with the soft landing thesis. [Here is a good read]( from [Nick Bunker]( at Indeed on how the labor market is settling down, but not falling off a cliff, as he puts it. Anyway, Friday we get non-farm payrolls, and then we'll have a new conversation and everything that came before it will be forgotten about. But for now, this is the latest labor market snapshot we have. Joe Weisenthal is the co-host of Bloomberg’s Odd Lots podcast. Follow him on X [@TheStalwart]( Like Bloomberg's Five Things? [Subscribe for unlimited access]( to trusted, data-based journalism in 120 countries around the world and gain expert analysis from exclusive daily newsletters, The Bloomberg Open and The Bloomberg Close. [Bloomberg Markets Wrap: The latest on what's moving global markets. Tap to read.]( Follow Us Like getting this newsletter? [Subscribe to Bloomberg.com]( for unlimited access to trusted, data-driven journalism and subscriber-only insights. Before it’s here, it’s on the Bloomberg Terminal. Find out more about how the Terminal delivers information and analysis that financial professionals can’t find anywhere else. [Learn more](. 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