Stock futures fall after third straight losing day for S&P 500

Morgan Stanley says the ‘smart’ electric vehicle industry is the next big thing in tech. Here are his top stock picks

Morgan Stanley says tech supply chains are poised for growth in the next big thing: smart tech features — from EV batteries to chips and self-driving technology.

The investment bank named its top picks of stocks that should benefit from this trend.

Pro subscribers can read the story here.

—Weizhen Tan

Fed’s Kashkari says his biggest fear is that inflation will be more persistent or hotter than expected

Minneapolis Federal Reserve Chairman Neel Kashkari said his biggest fear was that markets are underestimating the level of inflation or its persistence, adding that the Fed may need to be more aggressive than expected.

“The big fear I have deep down inside is that we are getting it wrong and the markets are getting it wrong, and that inflation is much more entrenched at a much higher level than we like or the markets like,” he said, commenting on the market. inflation expectations returning to 2% in the next two years.

“Then we will have to be more aggressive than I expected, probably longer, to bring inflation down,” he said at an event at the University of Pennsylvania.

Kashkari also pointed to supply-side shocks behind “one-half to two-thirds” of the country’s high inflation.

“The more supply-side help we get, the less the Fed has to do and the better able we are to avoid a hard landing,” he said. He added, however, that there is evidence that supply chains are starting to normalize.

Kashkari is already seen as the most hawkish of the 19 U.S. central bank policymakers and expects the Fed to raise its key rate – now within a target range of 2.25% to 2.5% – another two points percentage by the end of next year.

– Jihye Lee

CNBC Pro: Citi names energy stock with ‘strongest balance sheet’

The energy sector has been a big winner in this year’s volatile stock market.

But a stock always stands out for its “strongest track record,” according to Citi. It also posted a set of second-quarter profits that easily beat its major listed peers.

Pro subscribers can read the story here.

— Zavier Ong

Hawkish Fed?

Many expect hawkish rhetoric from Fed officials later this week, which could trigger a sell-off in risky assets. Some worry that continued aggressive central bank tightening could tip a slowing economy into recession.

“I expect Fed Chairman Jay Powell and other Fed officials to remain hawkish,” Invesco’s chief global markets strategist Kristina Hooper said in an email. . “Aggressive rhetoric would be very likely to drag global equities down in the near term, as markets are walking on eggshells, so asset owners need to be prepared for near-term volatility.”

—Yun Li

Nordstrom shares fall

Shares of Nordström fell more than 13% in extended trading after the company cut its financial forecast for the full year. Nordstrom said it was facing excess inventory as well as slowing demand.

“Customer traffic and demand slowed significantly beginning in late June, primarily at Nordstrom Rack,” CEO Erik Nordstrom said in a press release.

However, the company reported earnings and sales for the fiscal second quarter ahead of analysts’ estimates.

—Yun Li

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