MARKET WRAPS

Watch For:

Weekly Jobless Claims; Current Account for 4Q; New Home Sales for February; President Biden visits Canada; earnings from Accenture, General Mills, Darden Restaurants

Today's Headlines/Must Reads

Pro Take: The Fed Hits Inflation With Ninth Rate Hike as Banks Reel

Fed Walks Tightrope Between Inflation, Bank Turmoil-but for How Long?

Macro Hedge Funds Hit by Financial Turmoil

What Does 'Made in America' Mean? In Green Energy, Billions Hinge on the Answer.

Big Oil Eyes New Deals in North Africa Amid Rising Energy Demand

Electric-Vehicle Growth Expands GM Cyber Chief's Concerns to Charging Stations

Follow WSJ markets coverage here .

Opening Call:

Stock futures were slightly firmer on Thursday as investors reassessed the market's negative reaction to events late in the previous session.

SPI Asset Management said the improvement in market sentiment reflected a belief that Jerome Powell will be proven wrong after he made clear he disagreed with investors' bets the Fed will have cut rates to about 4.2% by the end of the year.

"U.S. futures are nudging higher as the market bets the Fed loses its nerve and downshifts anyway. Note the modern-day history book of Fed pauses is very bullish for stocks," SPI said.

Track reactions in Europe to the Fed interest rate hike.

Calmer conditions in bond markets were also supporting the mood, while a strong showing for some Asian bourses helped to underpin sentiment.

"Some relatively strong gains were recorded [in Asia], with investors choosing for the moment to focus on the possibility of stronger conditions in the region, propelled by the reopening of the Chinese economy," Interactive Investor said.

Stocks to Watch

Agile Therapeutics reported higher revenue and a narrower loss in its latest quarter. Its stock rose 16% in after-hours trading.

Chewy fell 2% after reporting a surprise profit in its fiscal fourth quarter but posting a drop of 1.2% in active customers from a year earlier to 20.41 million.

Coinbase was down 11% in premarket trading after saying it received a "Wells Notice" from the SEC, which warned that the agency's staff had made a preliminary determination to recommend an enforcement action against the crypto exchange.

First Republic Bank gained 4% in premarket trading, while fellow regional lender PacWest Bancorp rose more than 5%. First Republic dropped more than 15% on Wednesday, and PacWest slumped more than 17% following conflicting messages from government officials about the safety of deposits.

KB Home rose 2% after reporting fiscal first-quarter earnings and sales that beat analysts' estimates. The company said it began to see an increase in demand as it entered the spring selling season.

SQZ Biotechnologies said its Phase 1 SQZ-AAC-HPV-101 clinical trial would continue. Its shares rose 33% in after-hours trading.

Steelcase posted fiscal fourth-quarter sales that beat Wall Street expectations. The stock rose 3% in premarket trading.

Forex:

The dollar hit a seven-week low against a basket of currencies and is likely to stay weak after the Fed signaled rates may be close to a peak, ING said.

"The dollar weakened on the back of the moderate dovish surprise by the Fed yesterday, and reluctance from the Treasury to consider an extension to the deposit insurance," ING said.

Sentiment towards the dollar should stay bearish especially against European currencies, albeit with small corrections high rather than a straight-line dollar depreciation, ING added.

UniCredit Research said falls in the dollar could propel the euro rapidly above $1.10. EUR/USD received a big boost after the Fed, reaching a seven-week high of 1.0931.

"This reopens the chance of a relatively rapid test of the year-to-date peak of 1.1033 [in EUR/USD], with no major obstacle in between," UniCredit Research said.

Once above 1.10, EUR/USD's path towards 1.12--UniCredit's current target for this year--could also be quite smooth, with only 1.1073 as a notable resistance level.

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The Swiss franc turned higher on the day against the euro, after the SNB raised interest rates by 50 basis points to 1.5% and declared an end to the bank crisis.

Although the decision had been widely expected, some analysts had warned beforehand of the risk of the central bank opting for a smaller 25 basis point rate rise or even no rise at all due to recent banking-sector troubles, particularly with Credit Suisse.

Measures taken by Swiss authorities, including the SNB, to rescue Credit Suisse have "put a halt to the crisis," the SNB said in a statement accompanying the rate decision.

Read Swiss Central Bank Lifts Key Rate, Declares End to Bank Crisis

Energy:

Crude futures were slightly lower having made solid post-Fed gains. Despite the losses, analysts said demand for oil remains strong and is likely to strengthen further.

"The Energy Information Association's weekly report highlighted strong exports, while domestic fuel stockpiles declined," ANZ Research said, adding that Asian demand also remained firm, while the prospect of no more rate hikes this year was providing impetus for oil.

Read Big Oil Eyes New Deals in North Africa Amid Rising Energy Demand

Metals:

Base metal prices were mixed while gold rose more than 1%, as investors reacted to a "dovish" Fed.

"This was a 'dovish hike', i.e., higher rates but with lower projections, " Peak Trading Research said.

The dollar fell following indications from Jerome Powell that fewer or possibly no more rate hikes are set to happen for the rest of this year, a bullish trend for commodity markets, Peak said.

TODAY'S TOP HEADLINES

Big Oil Eyes New Deals in North Africa Amid Rising Energy Demand

CAIRO-After years of underinvestment in North Africa's energy infrastructure, global oil-and-gas giants from Halliburton Co. and Chevron Corp. to Eni SpA are ramping up their presence in the region as demand from Europe grows.

Executives in the industry are betting it is worth drilling again in some of the hardest places to do business in the world as Europe increasingly turns to other sources for its energy needs after shunning its main supplier, Russia, over the invasion of Ukraine. In recent months, a string of European officials have visited the region to help advance talks over potential supply deals.

TikTok CEO Seeks to Convince Congress Chinese-Owned App Isn't Security Threat

WASHINGTON-TikTok CEO Shou Zi Chew testifies Thursday morning at a high-stakes congressional hearing, as safety and security concerns over the Chinese-controlled platform deepen even as its popularity in the U.S. grows.

Mr. Chew, a Harvard-educated Singaporean army reservist and former Goldman Sachs banker, will testify before the House Energy and Commerce Committee, whose members have already signaled concerns that Beijing could influence TikTok content and harvest user data.

Electric-Vehicle Growth Expands GM Cyber Chief's Concerns to Charging Stations

Electric vehicles are taking General Motors Co.'s cyber chief into new territory.

Kevin Tierney, the auto maker's chief cybersecurity officer, often finds himself monitoring risks across information-technology systems, autonomous vehicles and manufacturing plants. Now, he's adding power-grid security to his day-to-day work.

Banks Are Risky. Silicon Valley Bank's Risk Officer Was AWOL.

James Lam had just been hired by a new financial division of GE Capital when he walked into his boss's office with a problem: He was ordering business cards and had no idea what to put on them. Since his position didn't really exist, it also didn't have a title, so he was given permission to invent one. He called himself a chief risk officer.

Thirty years later, as he followed the spectacular implosion of Silicon Valley Bank, there were few people more qualified than Mr. Lam to ask two simple questions.

Starbucks's New CEO Brews Coffee at Stores to Prepare for Role

CHICAGO-New Starbucks Corp. Chief Executive Laxman Narasimhan plans to be in regular contact with departing CEO Howard Schultz-but it will be clear who is in charge, both men said.

"There's places where he can be really helpful. The world, though, needs boxes and lines," Mr. Narasimhan said in an interview. "There's one CEO, and that's me."

China Evergrande Reaches Debt-Restructuring Deal With Bondholders

China Evergrande Group has reached an agreement with its offshore debtholders under which the property developer will issue new bonds and equity-linked products.

Binding agreements have been entered into with bondholders, including for $19.15 billion of notes the company had previously issued, Evergrande said late Wednesday.

SEC Plans Lawsuit Against Coinbase, According to Exchange

The Securities and Exchange Commission has told Coinbase Global Inc. that it plans to take enforcement action against the company, escalating its crackdown on digital-currency firms by targeting the biggest U.S. crypto exchange, Coinbase said Wednesday.

Coinbase said it had received a letter from the SEC known as a Wells notice, in which regulators say they believe companies or individuals violated investor-protection laws. The notices aren't final because the agency's commissioners must authorize any lawsuits or enforcement settlements.

Avaya Cleared to Hand Control to Lenders in Repeat Bankruptcy

Avaya Holdings Corp. won court approval Wednesday on a lender-backed chapter 11 exit plan that trims nearly $2.6 billion in debt from its balance sheet and provides new financing to continue transforming itself from a traditional provider of office telecommunications equipment to a subscription-based software provider.

Senior lenders including Apollo Global Management Inc. and Brigade Capital Management LP have agreed to exchange top-ranking debt for the equity in reorganized Avaya, which will become a private company upon leaving bankruptcy while wiping out existing Avaya shareholders.

Carvana Debt Exchange Lacks Support From Bondholder Group

Carvana Co.'s debt swap proposal launched on Wednesday doesn't have support from the group of investors who own a majority of the company's nearly $6 billion in unsecured bonds, people familiar with the matter said.

The used-car retailer is asking bondholders to swap some of their holdings at a discount into an up to $1 billion new secured bond, which would have a second-priority claim on collateral including certain assets and property owned by the Tempe, Ariz-based company, such as some of its vehicles.

Pro Take: The Fed Hits Inflation With Ninth Rate Hike as Banks Reel

The Federal Reserve on Wednesday stuck with its inflation fight as banks and regulators sort out the Silicon Valley Bank mess that has spread fear throughout the banking sector.

Its quarter-percentage-point interest-rate increase, though smaller than most of the hikes seen over the last year, feels like it packs more of a punch amid worries about the health of banks. But Fed Chairman Jerome Powell made clear that the Fed, even though it considered a pause, isn't bowing out of its inflation battle.

Fed Walks Tightrope Between Inflation and Bank Turmoil-but for How Long?

The Federal Reserve is responsible for the financial system and the macroeconomy. In theory, these are different jobs calling for different tools.

The Fed is trying to stay faithful to that separation of roles. On Wednesday, it continued its campaign to slow the economy and bring down too-high inflation, with a quarter-percentage-point increase in interest rates and a forecast of one more. Meanwhile, though, it has been lending generously to banks through its discount window to contain the damage caused by the failure of Silicon Valley Bank two weeks ago.

Swiss Central Bank Lifts Key Rate, Declares End to Bank Crisis

Switzerland's central bank raised its key interest rate Thursday and said the country's bank crisis had ended, the latest sign that policy makers are determined to press down on inflation despite strains in the banking system.

The Swiss National Bank increased its key interest rate by a half-percentage point to 1.5%, a move economists had expected before the banking strains that started in the U.S. spread to Switzerland. The central bank also indicated that it may again raise its key rate later this year.

Macro Hedge Funds Hit by Financial Turmoil

Hedge funds that bet on big-picture market moves have been hit with steep losses as a spate of recent bank failures upends bets that interest rates would remain elevated.

The souring of the wager led some, including Maniyar Capital Advisors and Haidar Capital Management, to lose more than 20% this month. Many of the funds, which had notched big gains as rates marched steadily upward in 2022, are now flat to down for the year following a steep recent drop in Treasury yields. So-called trend-followers, which try to take advantage of momentum in markets, also were hurt.

What Does 'Made in America' Mean? In Green Energy, Billions Hinge on the Answer.

Virginia-based power company AES Corp. says it is ready to push the button on a solar-panel order of more than $1 billion if a manufacturer will commit to building a factory in the U.S.

If that factory gets built, AES can buy its panels and apply for federal subsidies recently made available to clean-energy developers that use equipment made in the U.S.

Diesel Prices May Reflect Weakness in U.S. Economy

Diesel prices at the pump have fallen to their lowest in over a year. That's good news for consumers, but the decline in prices for the fuel suggests a gloomy outlook when it comes to the U.S. economy.

"Diesel fuel is ubiquitous in our economy," says Brian Milne, product manager, editor, and analyst at DTN. It's a "critical component in industrial production and...supply-chain dynamics."

Grand Jury Weighing Donald Trump Hush-Money Payment Scheduled to Return Thursday

A Manhattan grand jury considering Donald Trump's role in paying hush money to a porn star is scheduled to meet Thursday, according to people familiar with the matter, in what will likely be the panel's last day of deliberations this week as it moves closer to a potential indictment of the former president.

Ron DeSantis Clarifies Comments on Ukraine War, Calls Russian Invasion Wrong

WASHINGTON-Florida Gov. Ron DeSantis, a likely 2024 Republican presidential candidate, sought to qualify his recent contentious remarks that Russia's invasion of Ukraine was a "territorial dispute" and not vital to U.S. interests.

"Well, I think it's been mischaracterized," he told broadcaster Piers Morgan for an interview to be shown Thursday on the streaming service Fox Nation. Mr. Morgan included the comments in a column Wednesday evening for the New York Post.

Write to paul.larkins@dowjones.com TODAY IN CANADA

Earnings:

Aptose Biosciences 4Q

Badger Infrastructure Solutions 4Q

BRP 4Q

Copperleaf Tech 4Q

dentalcorp Hldgs 4Q

Karora Resources 4Q

Knight Therapeutics 4Q

MDA 4Q

Economic Calendar (ET):

0830 Jan Employment Insurance

Stocks to Watch:

Parkland Announces Agreement With Largest Shareholder Simpson Oil, Builds on Longstanding Relationship; Agreement Provides Simpson Oil the Right to Designate Up to Two Board Nominees, Includes Customary Voting Support Obligations in Favor of Bd

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Payfare 4Q Rev C$38.4M

Expected Major Events for Thursday

05:00/JPN: Feb Steel Production

05:00/JPN: Feb Supermarket sales

05:30/JPN: Feb Tokyo area department store sales

05:30/JPN: Feb Nationwide department store sales

12:00/UK: Agents' Summary of Business Conditions

12:00/UK: UK interest rate decision

12:30/US: Feb Chicago Fed National Activity Index (CFNAI)

12:30/US: 4Q International Transactions

12:30/CAN: Jan Employment Insurance

12:30/US: U.S. Weekly Export Sales

12:30/US: 03/18 Unemployment Insurance Weekly Claims Report - Initial Claims

13:00/RUS: Weekly International Reserves

14:00/US: Feb New Residential Sales

14:30/US: 03/17 EIA Weekly Natural Gas Storage Report

15:00/US: Mar Federal Reserve Bank of Kansas City Survey of Tenth District Manufacturing

20:30/US: Federal Discount Window Borrowings

20:30/US: Foreign Central Bank Holdings

23:30/JPN: Feb CPI (Nation), CPI ex-food (Nation)

All times in GMT. Powered by Onclusive and Dow Jones.

Expected Earnings for Thursday

AVROBIO Inc (AVRO) is expected to report $-0.49 for 4Q.

Accenture PLC (ACN) is expected to report $2.51 for 2Q.

Advaxis Inc (ADXS) is expected to report for 1Q.

Alimera Sciences Inc (ALIM) is expected to report for 4Q.

Amerityre Corp (AMTY) is expected to report for 2Q.

Applied Therapeutics Inc (APLT) is expected to report for 4Q.

AstroNova Inc (ALOT) is expected to report for 4Q.

Atlantic American (AAME) is expected to report for 4Q.

BRP Inc (DOO.T,DOOO) is expected to report $3.70 for 4Q.

Canlan Ice Sports (ICE.T) is expected to report for 4Q.

Commercial Metals Co (CMC) is expected to report $1.52 for 2Q.

ContraFect Corp (CFRX) is expected to report for 4Q.

Darden Restaurants (DRI) is expected to report $2.24 for 3Q.

Disc Medicine Inc (IRON) is expected to report for 4Q.

ENGlobal (ENG) is expected to report for 4Q.

Edgio Inc (EGIO) is expected to report $-0.16 for 4Q.

Energy Focus Inc (EFOI) is expected to report for 4Q.

Exscientia PLC - ADR (EXAI) is expected to report for 4Q.

Factset Research Systems (FDS) is expected to report $3.22 for 2Q.

General Mills (GIS) is expected to report $0.93 for 3Q.

Knight Therapeutics Inc (GUD.T) is expected to report $-0.06 for 4Q.

Lithium Americas Corp (LAC,LAC.T) is expected to report for 4Q.

MarketWise Inc (MKTW) is expected to report for 4Q.

Movado Group Inc (MOV) is expected to report $0.87 for 4Q.

Noranda Income Fund (NIF.UN.T) is expected to report for 4Q.

Ocuphire Pharma Inc (OCUP) is expected to report for 4Q.

Orbit International (ORBT) is expected to report for 4Q.

Perma-Fix Environmental Services Inc (PESI) is expected to report for 4Q.

Priority Technology Holdings Inc (PRTH) is expected to report for 4Q.

Rex American (REX) is expected to report for 4Q.

Rubicon Technology Inc (RBCN) is expected to report for 4Q.

SecureWorks Corp (SCWX) is expected to report $-0.42 for 4Q.

Spectral Medical Inc (EDT.T) is expected to report $-0.01 for 4Q.

Synlogic (SYBX) is expected to report $-0.26 for 4Q.

TOR Minerals International Inc (TORM) is expected to report for 4Q.

TherapeuticsMD Inc (TXMD) is expected to report for 4Q.

Urban One Inc - Class A (UONE,UONEK) is expected to report for 4Q.

Vera Therapeutics Inc (VERA) is expected to report for 4Q.

Werewolf Therapeutics Inc (HOWL) is expected to report for 4Q.

Wireless Telecom (WTT) is expected to report $-0.02 for 4Q.

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ANALYST RATINGS ACTIONS

Altimmune Cut to Neutral From Buy by Goldman Sachs

Antero Resources Cut to Market Perform From Outperform by BMO Capital

Apple Hospitality REIT Cut to Neutral From Buy by Compass Point

Consolidated Edison Raised to Buy From Hold by Argus Research

Correcting to Luminar Technologies Rating Headline

Cyxtera Technologies Cut to Market Perform From Outperform by Raymond James

DoubleVerify Raised to Overweight From Sector Weight by Keybanc

DR Horton Cut to Peer Perform From Outperform by Wolfe Research

Enphase Energy Raised to Positive From Neutral by Susquehanna

Host Hotels & Resorts Cut to Neutral From Buy by Compass Point

Invitation Homes Cut to Neutral From Buy by Mizuho

Knight-Swift Transport Raised to Outperform From Peer Perform by Wolfe Research

Krispy Kreme Raised to Buy From Hold by Truist Securities

Luminar Technologies Cut to Sell From Neutral by Goldman Sachs

Meta Platforms Raised to Overweight From Sector Weight by Keybanc

Nike Raised to Overweight From Equal-Weight by Barclays

PulteGroup Raised to Outperform From Peer Perform by Wolfe Research

Ross Stores Raised to Buy From Hold by Loop Capital

Semtech Raised to Buy From Neutral by B. Riley Securities

Sunstone Hotel Investors Cut to Sell From Neutral by Compass Point

Warner Music Group Raised to Buy From Neutral by Guggenheim

This article is a text version of a Wall Street Journal newsletter published earlier today.

(END) Dow Jones Newswires

March 23, 2023 06:10 ET (10:10 GMT)

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