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(Bloomberg) — US stock futures indicated a weaker open on Wall Street as traders awaited data on job openings to guide their outlook on the economy. Nvidia Corp. dropped 1.6% in pre-market trading.

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Contracts on the S&P 500 dipped 0.3%, a sign that the decline may moderate after yesterday’s 2.1% selloff. Losses in Europe and Asia were deeper, with traders still rattled by the speed and severity of the US retreat. The Cboe Volatilty Index climbed above 23, while a gauge of the dollar weakened for the first time in six days.

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A US job openings report due on Wednesday is expected to show further cooling in the labor market, following yesterday’s data showing a fifth consecutive month of contraction in manufacturing activity. As the market’s focus shifts from inflation to concerns over economic growth, negative macro data is increasingly translating into pain for stocks and other risk assets.

For now, traders are anticipating the Federal Reserve will start easing policy in September and reduce rates by more than two full percentage points over the next 12 months — the steepest drop outside of a downturn since the 1980s. Payrolls data due on Friday is considered crucial in shaping the magnitude of the initial rate cut.

“A disappointing number will spook markets a little bit,” said Neil Birrell, chief investment officer at Premier Miton Investors. “There’s just a lack of certainty around. I’m not brave enough to say buy the dip on Wednesday when the numbers are out on Friday.”

Treasuries gained for a second day as traders added to bets on a jumbo cut from the Fed, with the yield on two-year notes down to 3.86%. The chance of a half-point reduction later this month has increased to about 30% from 20% last week, according to swaps.

Oil rose slightly after crashing to a nine-month low as OPEC+ discussed delaying its plans to increase supplies. Brent futures, the international benchmark, were trading near $74 a barrel following a near 5% meltdown on Tuesday. West Texas Intermediate rose 0.5%, after dropping under $70 for the first time since early January.

Corporate Highlights:

• The Nordstrom family has offered to buy the Nordstrom department store chain for $23 per share in cash, according to a statement on Wednesday.

• Volvo Car AB abandoned a target to sell only fully electric cars by the end of this decade, the latest manufacturer to walk back its EV ambitions due to waning demand.

• US Steel would close mills and likely move its headquarters out of Pittsburgh if its planned sale to Nippon Steel falls apart, CEO David Burritt told the Wall Street Journal.

• Volkswagen AG defended plans to consider unprecedented factory closures in Germany, saying flagging car sales have left the company with about two plants too many.

• The US Justice Department sent subpoenas to Nvidia Corp. and other companies as it seeks evidence that the chipmaker violated antitrust laws.

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Key events this week:

• Eurozone HCOB services PMI, PPI, Wednesday

• Canada rate decision, Wednesday

• US job openings, factory orders, Beige Book, Wednesday

• Eurozone retail sales, Thursday

• US initial jobless claims, ADP employment, ISM services index, Thursday

• Eurozone GDP, Friday

• US nonfarm payrolls, Friday

• Fed’s John Williams speaks, Friday

Some of the main moves in markets:

Stocks

• S&P 500 futures fell 0.3% as of 8:20 a.m. New York time

• Nasdaq 100 futures fell 0.6%

• Futures on the Dow Jones Industrial Average fell 0.1%

• The Stoxx Europe 600 fell 1%

• The MSCI World Index fell 0.4%

Currencies

• The Bloomberg Dollar Spot Index was little changed

• The euro was little changed at $1.1046

• The British pound was unchanged at $1.3114

• The Japanese yen rose 0.3% to 145.09 per dollar

Cryptocurrencies

• Bitcoin fell 2.8% to $56,575.39

• Ether fell 2.6% to $2,399.7

Bonds

• The yield on 10-year Treasuries was little changed at 3.83%

• Germany’s 10-year yield declined four basis points to 2.24%

• Britain’s 10-year yield declined four basis points to 3.95%

Commodities

• West Texas Intermediate crude rose 0.5% to $70.66 a barrel

• Spot gold fell 0.1% to $2,489.57 an ounce

This story was produced with the assistance of Bloomberg Automation.

–With assistance from Aline Oyamada and Joel Leon.

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©2024 Bloomberg L.P.

Good morning. Longtime Salesforce executive Amy Weaver is stepping down from her role as president and CFO after a three-and-a-half-year tenure in the position. Her CFO tenure coincided with a period of growth at the company, and came after Weaver undertook a very unusual C-suite shift—one that involved trading in the role of top legal officer for top financial officer.

In a LinkedIn post on Aug. 28, Weaver said she decided to step down “after nearly 11 wonderful years at Salesforce” and she’s “excited about my next chapter and the new opportunities ahead.” Weaver also pointed to a pivotal career move she made at the company.

“My time at Salesforce has been an incredible experience—from joining as general counsel to leading the legal and corporate affairs teams to taking the truly unprecedented step to jump over to become CFO,” Weaver wrote. She also noted Salesforce CEO Marc Benioff’s “expansive vision” of her career.

Weaver joined Salesforce, the cloud-based software giant, in 2013 as SVP and general counsel. In January 2020, she became president and chief legal officer. The company announced on Dec. 1, 2020, that Weaver would become president and CFO in February 2021, succeeding CFO Mark Hawkins, who was retiring. The same day in 2020 that Salesforce announced the CFO transition, it also reported it would acquire the workplace messaging app Slack for $27.7 billion.

Before joining Salesforce, Weaver was EVP and general counsel of Univar Solutions Inc., SVP and deputy general counsel at Expedia, Inc., and practiced as an attorney at Cravath, Swaine & Moore and at Perkins Coie. Before entering private practice, she served as a legislative aide for the Hong Kong Legislative Council and as a clerk in the U.S. Ninth Circuit Court of Appeals.

I asked Scott W. Simmons, co-managing partner of Crist Kolder Associates, a senior-level executive search firm, what he’s seen regarding general counsels moving into CFO roles. “It is not at all common,” Simmons told me. The legal route to CFO “doesn’t even register as a path” in the firm’s most recent Volatility Report,” he said.

The firm’s report is based on data from 671 Fortune 500 and S&P 500 companies through Aug. 1. The research finds that three-quarters of CFOs came directly from a number two finance position, such as a corporate finance executive, controller, and chief accounting officer.

Simmons also conducted a search on S&P Capital IQ of 1,478 publicly traded companies in the U.S. earning over $1 billion in revenue. Less than 3% of CFOs in that data set have a JD degree. Even taking into account a margin for error in this data, “it does prove the point that it is extremely rare for CFOs to also be lawyers,” he said.

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However, Simmons noted that the most important trait for any CFO position is strong leadership.

“Amy has been an incredible executive at Salesforce, leading many of the company’s most important strategic and operational initiatives over the last decade,” Benioff said in a statement in the announcement. “And, she has been an amazing partner to me personally.”

Since Weaver began her tenure as finance chief in 2021, Salesforce has moved up 14 spots in the Fortune 500. The company’s annual revenue for its fiscal year 2023 was $31.4 billion, an 18% increase year over year. On Aug. 28, Salesforce reported revenue of $9.33 billion for the quarter ended July 31, up 8% year over year. “Operating margins closed at record highs with GAAP operating margin of 19.1%, up 190 basis points year over year, and Non-GAAP operating margin of 33.7%, up 210 basis points year over year,” Weaver said in a statement.

A successor for Weaver has not yet been appointed. “I’ll be at the company while we conduct an internal and external search, so no goodbyes for now,” she wrote on LinkedIn.

Sheryl Estrada
sheryl.estrada@fortune.com

This story was originally featured on Fortune.com

Presidential elections matter. Candidates usually have competing visions for the country. Those visions can create winners in some areas — and losers in others. As a result, prudent investors watch elections closely.

It isn’t too soon to begin thinking about which stocks could be winners depending on which presidential candidate wins. And there’s one Dividend King that could be a no-brainer buy if Kamala Harris beats Donald Trump in November.

Go high, go Lowe’s

Most Americans are probably quite familiar with Lowe’s Companies (NYSE: LOW). The company ranks as the second-largest home improvement retailer in the world. Its market cap hovers around $140 billion.

Lowe’s operates more than 1,700 home improvement stores throughout the U.S. It serves individuals performing do-it-yourself fixer-upper projects. The company also targets professionals, including skilled tradespeople, remodelers, and property managers.

Although Lowe’s stock is lagging behind the S&P 500 so far in 2024, it’s beaten the market over the long term. For example, Lowe’s more than doubled the return of the S&P 500 over the last 10 years.

Lowe’s has also been a favorite for income investors. The company has paid a dividend every quarter since it went public in 1961. Lowe’s has increased its dividend for 51 consecutive years.

Why a Harris victory could benefit Lowe’s

In August, Vice President Harris unveiled her plan to lower housing costs. She wants to provide up to $25,000 to first-time homebuyers to help with their down payments. First-time homebuyers would also receive a $10,000 tax credit. Harris’ plan also features tax incentives to promote the construction of starter homes and affordable rental housing.

How could this plan help Lowe’s? For one thing, Lowe’s caters to homebuilders. It even has a strategic alliance with the National Association of Home Builders that offers discounts to the organization’s members. Lowe’s should have an opportunity to profit from any federal initiative that boosts the construction of new houses.

But Harris’ plan doesn’t just foster the building of new homes. It should also promote a frenzy of fixing up existing homes, especially those that are attractive to first-time homebuyers. Again, Lowe’s would likely be a key beneficiary from a surge in home improvement projects.

Of course, a Harris victory in November by itself might not be enough. If she’s elected as the next president, she’ll need support in Congress to pass her housing plan.

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A good pick regardless of which candidate wins

Lowe’s could be a no-brainer buy if Harris beats Trump. However, the stock could be a good pick regardless of which candidate wins.

Over the short term, lower interest rates could provide a catalyst for Lowe’s stock. Federal Reserve Chairman Jerome Powell has strongly hinted that rate cuts will be coming soon. When interest rates fall, mortgage rates usually do too. This spurs home buying — and home improvement projects for existing homeowners looking to move into a new home.

Lowe’s should also have great long-term prospects. The median age of homes in the U.S. is over 40 years old. Home improvement projects will needed for decades to come. And Lowe’s will be there to meet those needs.

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• Blowout equity momentum isn’t guaranteed after the Fed cuts rates, JPMorgan said.

• If the Fed cuts in reaction to weaker growth, the positive impact may be muted, the firm wrote.

• Other analysts are more bullish on the economy and the equity-positive effect of rate cuts.

Interest-rate cuts are on the horizon, but investors who think this will generate a fresh dose of equity momentum could be mistaken, JPMorgan said.

In a new research note, JPMorgan strategists led Mislav Matejka said the Federal Reserve’s eventual rate cuts will be at least partially in response to a slowing economy, which could neutralize the positive effect on stocks.

“Fed will start easing, but more in a reactive way and as a response to weakening growth — this might not be enough to drive a next leg higher,” strategists led by Mislav Matejka wrote on Monday.

Additionally, JPMorgan wrote: “We are not out of the woods yet, September has seasonally been a challenging month for equities.”

The firm’s view stands in contrast to more bullish forecasts held by those who think a post-rate-cut rally is in the cards.

For instance, one Wells Fargo analyst recently indicated that equities are bound for a rally not seen in three decades once Fed policy eases.

According to Paul Christopher, head of global investment strategy, today’s market has strong parallels with that of 1995 — and with the Fed cutting proactively amid stable GDP strength, further upside looks likely.

Meanwhile, veteran strategist Jim Paulson suggested that the Fed’s pivot would open the door to a “brand new bull market.”

“They opened up a lot more positive forces for the stock market that just haven’t been there,” he said, speaking after Fed Chairman Jerome Powell confirmed that interest rate cuts were likely during last month’s Jackson Hole Symposium.

Once the Fed cuts, these forces include accelerating monetary growth and falling bond yields, propelling private sector confidence higher, Paulson said.

Friday’s nonfarm payrolls report will be the next major input for the Fed, which is currently expected to cut rates by 25 basis points at its late-September policy meeting.

An especially weak report could revive cries for a deeper rate cut in September — possibly 50 basis points — as well as an accelerated pace of cuts heading into the November election and year-end.

Read the original article on Business Insider

(Bloomberg) — The sense of calm in the US stock market was disrupted Tuesday as the S&P 500 Index plunged more than 2% and the VIX exploded higher. That’s rewarded a late-Friday options buyer with some $12 million in paper gains.

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The spike in volatility came as the S&P 500 index was dragged down by a selloff in technology stocks with AI giant Nvidia Corp.’s market capitalization dropping by the equivalent of Chevron Corp.

Late Friday, an investor or investors spent almost $9 million buying 350,000 call spreads on the Cboe Volatility Index, or VIX, to protect against a September jump in the gauge, which measures volatility on S&P 500 options.

At the time, those spreads — buying the 22 call, selling the 30 call expiring Sept. 18 — cost 25 cents each. On Tuesday, with the VIX jumping from less than 16 to almost 22 before the close, almost as many spreads traded, this time with many of them going for around 60 cents.

It appears that Friday’s buyer turned around and sold the position, according to market participants, though it’s hard to know for sure. In any case, the potential profit comes to about $12.25 million.

–With assistance from Alyce Andres.

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