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Wall Street Spooked By Hot Inflation Numbers

Your unbiased daily news brief

Author

James Kratch
February 14, 2024

Good morning! It is a busy day, with Valentine's Day and Ash Wednesday falling on the same day. It is the second time in less than a decade this has occurred; the holidays also lined up in 2018 and will coincide next in 2029. Have a great day!

In Today’s Brief

  • Mayorkas: Impeached on second try

  • India: Farmers clash with police

  • New York: Democrats flip Santos seat

  • Squishmallows: Build-A-Bear lawsuit

  • Super Bowl: Highest TV rating ever

... and more

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Top Tips

1) Markets tumble

Wall Street was reeling yesterday after unexpectedly hot inflation numbers.

  • The report: Inflation was up 3.1% YoY and 0.3 MoM in January, according to the Consumer Price Index. Both measures missed forecasts; analysts expected 2.9% YoY growth and 0.2 MoM.

  • Major indexes: The Dow Jones was down over 500 points, closing down 1.35% for its worst day in almost a year. The Nasdaq (-1.80%) and S&P 500 (-1.37%) also had rough days.

  • Big picture: The report will likely galvanize the Federal Reserve's cautious approach to interest rate cuts; any movement before the summer seems unlikely. It is also unwelcome news for President Joe Biden's re-election campaign.

2) A bloody problem

The United Kingdom is on high alert amid fears of a tea shortage.

  • The issue: Great Britain relies on Red Sea shipping lanes to import its beloved drink. They are currently menaced by the Houthi rebels, an Iranian-backed group that has attacked commercial and military vessels in the region for months. Black tea supplies are of particular concern.

  • Conflicting messages: Retail groups and supermarkets have said any disruptions will be temporary and consumer impact will be minimal. But there have been general warnings about a potential shortage and social media postings about empty shelves as manufacturers concede supplies are tightening.

  • Big picture: It could be hysteria and hoarding similar to the early days of the coronavirus pandemic … or the first instance of Houthi actions impacting households. The UK will also hold contentious elections later this year.

3) Bloc brouhaha

President Biden blasted former President Donald Trump’s recent NATO comments, calling them “un-American.”

  • The comments: Trump claimed while in office, he told a European leader he would encourage Russia to attack alliance members that were not meeting NATO defense spending targets. Trump has repeatedly criticized the bloc and questioned U.S. involvement.

  • The response: Biden said Trump's comments were shameful; he vowed the U.S. would fulfill its commitment to defend any NATO member that Russia attacks. Biden echoed a slew of European leaders and others who have criticized Trump.

  • Big picture: A recent law would let the Senate block any effort by a re-elected Trump to leave NATO. But his allies have begun floating proposals to drastically change how the alliance operates as it becomes an election issue.

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Quick Tips

U.S. News

  • The House impeached Homeland Security Secretary Alejandro Mayorkas on its second try with a 214-213 vote. Mayorkas is the first cabinet official impeached since 1876; the Senate is not expected to convict (More)

  • New York City's public schools dealt with widespread technology issues yesterday after a nor'easter led to a remote learning day. Mayor Eric Adams was criticized for not permitting a snow day (More)

  • A Kansas man was arrested for stealing a statue of baseball legend Jackie Robinson from a Wichita park. Law enforcement believes the suspect was part of a group that planned to sell the statue as scrap metal (More)

World News

  • Police in India used tear gas as they clashed with farmers marching toward New Delhi to protest crop prices. India saw long-term agricultural demonstrations in 2021; similar movements have recently occurred in Europe (More)

  • Workers removed scaffolding from the reconstructed Notre Dame cathedral spire in France. The cathedral will reopen in December after a 2019 fire (More)

  • Estonian Prime Minister Kaja Kallas and South Carolina Sen. Lindsay Graham are among the high-profile names on secret arrest warrants issued by Russian prosecutors. Investigative reporters in the country uncovered the list (More)

Campaign News

  • Tom Suozzi won a special election in New York’s 3rd Congressional District, giving Democrats the House seat vacated by George Santos’ expulsion. The Republican majority is now only six seats (More)

  • Former President Trump endorsed a new RNC leadership team that would include Lara Trump, his daughter-in-law. Ronna McDaniel, the current chairwoman, is expected to step down soon (More)

  • Embattled Missouri Rep. Cori Bush trails her Democratic primary opponent by 22 points, according to a new poll. Bush is under federal investigation for misuse of funds (More)

Business & Markets

  • The maker of Squishmallows toys filed an IP lawsuit against Build-A-Bear Workshop. Jazwares alleges the chain's Skoosherz toys are a knockoff product (More)

  • Tesla made almost $2B in regulatory credit sales last year. The electric vehicle manufacturer sells the credits to automakers who fail to meet EV and emissions quotas (More)

  • ESPN Bet will launch in New York, the nation's largest betting market. Parent company Penn Entertainment bought Wynn Interactive's state license for $25M (More)

Entertainment & Sports

  • Super Bowl LVIII was the most-watched event in television ratings history, according to preliminary data. Just over 123M are believed to have watched the Kansas City Chiefs' overtime victory (More)

  • Katy Perry plans to leave American Idol after its upcoming season. The pop singer has been a judge on the show for seven years; she also hinted at plans for new music (More)

  • The Premier League approved British billionaire Jim Ratcliffe's deal to buy 25% of Manchester United. Ratcliffe will pay $1.3B; England's Football Association still must sign off (More)

Quick Hitters

  • Feel Good: A Michigan man wanted to honor someone close to him who passed away. He chose a grand gesture, leaving a $10K tip on a $32 bill at a Michigan coffee shop in her name.

  • Take Note: The CDC will issue new guidance ending its five-day COVID-19 isolation recommendation. People with mild and improving symptoms can leave home after 24 hours without a fever.

  • Self Care: Valentine's Day is not just for those in relationships. Personal wellness and friendship have become consumer trends around the holiday.

  • Love Birds: Joel and Shelley Atkinson met while flying jets in the Air Force. Almost 30 years later, they fly together for Southwest Airlines with Joel as captain and Shelley as first officer.

  • Life Hack: Looking for a new job? This simple resume approach can pay dividends, according to an experienced recruiter.

  • Be Well: Pop quiz: What’s the body’s most abundant protein? The answer: Collagen. NativePath's Certified Grass-Fed Collagen Powder is made from grass-fed, pasture-raised cows and contains 18 grams of protein per suggested serving. Start incorporating it daily to support skin elasticity, joint health, bone strength, and muscle growth and maintenance.*

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Looking Ahead …

The Chiefs will try to become the first team to win three straight Super Bowls next season. If they do, NBA coaching legend Pat Riley's favorite causes stand to benefit. Riley trademarked the term "three-peat" when his Los Angeles Lakers teams pulled off the feat in the 1980s; he said he donates most of the revenues he receives to charity.

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