This week ahead || Oct 23rd - Oct 27th 2023
'Quality over quantity': How Apple wants to lure sports fans to its streaming service
The backlog of ships at Israeli ports is growing due to ongoing operations at most terminals and military preparations for a ground assault in the Gaza Strip. This is a result of the recent conflict in the region. Israel has faced heavy rocket barrages, which prompted the closure of Ashkelon port, the nearest terminal to Gaza, and restrictions on the transport of hazardous materials at Ashdod port. At least three cargo and dry bulk ships bound for Ashdod are waiting nearby, and around 13 ships are moored inside Ashdod port. Wait times for ships docking in Israel have traditionally been longer than in other ports, and marine war insurance rates have surged. The situation raises concerns about potential disruptions to vital shipping chokepoints in the region.
The American semiconductor boom faces a massive obstacle: A lack of immigrants
The semiconductor industry in the United States is facing a labor shortage that could impede its growth, with nearly 80% of the projected 85,000 new technical jobs in the industry by 2030 expected to go unfilled, according to a report by the Semiconductor Industry Association and Oxford Economics. A significant challenge is the current immigration laws, which make it difficult for foreign-born skilled workers to stay in the country. The semiconductor industry has been actively working to improve the situation, but industry leaders and experts believe that immigration law reform is needed to address this labor shortage.
Top 5 things to watch in markets in the week ahead
The market is gripped by a risk-off mood due to worries about potential interest rate hikes and the Israel-Hamas conflict. Four megacap companies, including Microsoft and Amazon, are set to report earnings, and their results could significantly impact the broader market. Key U.S. economic data this week includes an expected 4.1% annualized GDP growth for the third quarter and a forecasted 3.7% increase in the core personal consumption expenditures price index. Oil prices saw volatility but settled lower after Hamas released U.S. hostages, offering hope for de-escalation in the Middle East. The European Central Bank is expected to maintain interest rates, and the Eurozone's economic outlook is being scrutinized amidst concerns about weakening consumer spending and persistent high inflation.
Coca-Cola FEMSA plans dividend hike, backed by robust earnings
Coca-Cola FEMSA (KOF) plans to raise its dividend to MX$1.41, offering a substantial annual payout of 4.6% relative to the stock price. This decision is supported by strong earnings and cash flow, reflecting the company's commitment to reinvestment. With a market cap of $14.62 billion and a low P/E ratio of 1.31, the company demonstrates financial health. The stable forecasted payout ratio of 2.5% and an expected 25.2% EPS growth for the coming year underpin the sustainability of this dividend increase. Coca-Cola FEMSA has a 20-year track record of dividend payments, highlighting its financial stability and shareholder dedication. The company's consistent earnings growth of 33% over the past five years reinforces its dividend strategy and overall performance in the beverages industry.