5 Things You Need to Know to Start Your Day

Good morning. The big rate-cut trade is facing a reality check in markets and crypto’s latest comeback is not lifting all boats equally. Plu [View in browser]( [Bloomberg]( Good morning. The big rate-cut trade is facing a reality check in markets and crypto’s latest comeback is not lifting all boats equally. Plus Elon Musk's SpaceX is becoming rapidly more valuable. Here’s what people are talking about. [Sofia Horta e Costa]( Tell us what you want to see in the Five Things newsletter! Please [take our quick survey here.]( Reality check US stock futures are little changed as I type this morning, following a three-day slide in the S&P 500 that’s been its longest in more than a month. Oil is stabilizing [near a five-month low]( and Bitcoin is trading just below $44,000 -- a level not seen since June last year. Treasury yields are [a little higher]( as traders navigate between a higher-for-longer narrative on the one hand and betting on a[ rate-cut bonanza]( from central banks next year on the other. The reality check today is coming from Japan, where yields are surging as hints from the country’s central bank leadership [fuel speculation]( that the end of negative interest rates might be closer. Here’s a great piece on how traders are betting big again on Fed rate cuts after [so many false dawns](. Oh and corporate bonds globally are on track to outpace comparable government debt by the most in four years. Crypto comeback Bitcoin has surged more than 165% this year, driving gains in crypto stocks highly linked to the price of the digital asset. That’s made betting against such stocks — like Coinbase, MicroStrategy and Marathon Digital — [a losing bet for short sellers](, who are now running paper losses of $6 billion so far this year, according to one estimate. The total market value of cryptocurrencies has jumped some 12% — or $180 billion — in the past seven days alone. But one coin that’s missed out: Binance’s BNB token. It’s a sign of the [challenging outlook]( for the largest crypto exchange after it pleaded guilty to US charges and was hit with a $4.3 billion penalty. Meanwhile, Robinhood is [launching commission-free crypto trading](in the European Union today and long-time skpetic Jamie Dimon said he would shut down the whole crypto industry if [he was in government]( rather than at the helm of JPMorgan. To the moon Elon Musk's SpaceX could be [valued at $175 billion]( or more. That’s according to a tender offer that could see shares offered at about $95 apiece, people familiar with the matter told my colleagues [Gillian Tan](, [Katie Roof](, and [Edward Ludlow](. It would be a step up from the $150 billion valuation that SpaceX, the most valuable US startup right now, commanded in a tender offer just this summer. As well as its commercial space launch services, SpaceX also operates the internet-from-space Starlink business, which has been in high demand by governments in Israel and Ukraine to back up their wartime communications. SpaceX revenues are on track [to hit $9 billion this year]( across the rocket launch and Starlink services. Green profits Green investing isn’t having a good year. The S&P Global Clean Energy Index is down almost 30% this year, compared with an almost 20% gain in the S&P 500. It’s against this backdrop that Ray Dalio, the founder of Bridgewater Associates, reminded delegates at the COP28 climate summit in Dubai that getting private capital excited about [funding climate projects]( has to be [a two-way stree](t: the returns need to make sense too. Representatives from banks including JPMorgan and Bank of America also made a similar point, while Shriti Vadera — chair of Prudential — said no one should expect private capital to fill a political or policy void without the right incentives. Coming up… Today’s US economic releases include the final October reading for wholesale inventories as well as the weekly jobless claims figures and consumer credit data. Mexico, Chile and Colombia publish their latest inflation reports. What we’ve been reading This is what’s caught our eye over the past 24 hours. - China’s imports unexpectedly [shrank in November](. - While Xi tells EU leaders China wants to be a [key partner](on trade. - In Japan, traders reload on bets for a rate hike [from the BOJ](. - How AMD plans to chase Nvidia with [accelerator chips](. - Thunderstorms caused a [record $60 billion]( in insured losses this year. - An AI drive-thru reveals humans are needed to [review 70% of orders](. - Taylor Swift is Time Magazine’s [Person of the Year]( for 2023. And finally, here's what Joe’s interested in this morning While we wait for Friday's jobs report, here's something to keep your eye on: gasoline keeps getting cheaper. This is a chart of RBOB (wholesale gasoline) futures going back daily for the last 10 years. They've taken another leg down over the last several days and are basically right where they were in 2018 and much of 2019. There's been so much talk over the last 2-3 years about how we were in a new oil supercycle, or how the Biden administration was impairing oil production, or how companies were reluctant to invest in new oil production because investors were prizing profitability over volume. All of these narratives. And some of them may have some degree of truth to them. But at least for the moment, it's still looking as though gasoline or oil has this crazy pandemic whipsaw (like many other things) and is basically returning to the old normal. And further to this point, there continues to be a lot of discussion about why consumer sentiment indicators are so dismal. And while that debate is interesting, one thing that seems possible is that between falling gasoline and falling rates, sentiment starts to improve. While it's not one of the major indicators that people watch, [a measure of economic sentiment from Penta-CivicScience just gained for the second straight reading](, hitting its highest level since early August. And for the first time since June, all five of the subcategories gained as well. So while it's always fun to have theoretical conversations, something to watch for is whether sentiment just starts to improve. 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. Tell us what you want to see in the Five Things newsletter! Please [take our quick survey here.]( [Bloomberg Markets Wrap: The latest on what's moving global markets. Tap to read.]( Follow Us Like getting this newsletter? 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