The initial public offering of semiconductor designer Arm is an opportunity to wonder if this year\u2019s technology-stock rally still has legs.<\/p>\n
The gains are impressive so far. The tech-heavy Nasdaq is up 32% since Jan. 1, and it had its best first eight months of the year since 2003. The S&P 500 Technology Hardware & Equipment industry group has risen almost 30%.<\/p>\n
Arm\u2019s shares, which start trading on the Nasdaq Thursday, were priced at the top end of the range. That suggests investors are still willing to fork out for shares in the sector.<\/p>\n
Having said that, September is usually a bad time for stocks, and tech stocks haven\u2019t had a great month so far. Will the Arm IPO prove to be the last hurrah for the rally?<\/p>\n
The risks are plentiful. A sluggish economic recovery in China, as well as the persistent tit-for-tat in the tech cold war between China and the U.S., will continue to cast a shadow over the outlook. China is important for more tech companies\u2014both as a manufacturing base and as a market to sell into. Arm warned that a difficult relationship with its Arm China unit presents a risk to future profits.<\/p>\n
It may be some relief that the Federal Reserve might be finished raising interest rates, or is at least close to finishing. But data out Wednesday suggest the inflation dragon isn\u2019t yet slain, which means higher rates remain a risk.<\/p>\n
And then there\u2019s the hype around artificial intelligence, which has provided such a huge lift to tech stocks. The question is how long it can last. The tech-stock rally is hanging in the balance. Arm could tip it one way or the other.<\/p>\n \u2014Brian Swint<\/em><\/p>\n *** Join Barron\u2019s deputy editor Alex Eule and associate editor for technology Eric J. Savitz today at noon when they discuss the outlook for tech companies and individual stocks. Sign up here.<\/em><\/p>\n Try your hand at this morning\u2019s Barron\u2019s crossword puzzle and sudoku games. For all games, including a digital jigsaw based on the week\u2019s cover story, click here.<\/em><\/p>\n Auto industry experts are bracing for the possibility that 150,000 workers could walk off the job as early as midnight tonight as the contract between the United Auto Workers and General Motors,<\/span> What\u2019s Next:<\/strong> The strike deadline also looms over the nine-day North American International Auto Show in Detroit. Fifteen automotive brands have displays, but only six new models are scheduled to be revealed, along with a new Jeep and a refreshed Ford F-150 pickup. The show runs through Sept. 24.<\/p>\n \u2014Megan Leonhardt and Janet H. Cho<\/em><\/p>\n August\u2019s consumer price index showed inflation continued to cool mildly from the sky-high price gains that plagued consumers and policy makers for the past two years. Core prices, excluding volatile food and energy, slowed to a 4.3% annual pace, the lowest level since September 2021.<\/p>\n What\u2019s Next:<\/strong> Inflation-focused traders expect the annual CPI rate to remain above 3% between now and January, MarketWatch reported. The Fed wants inflation back to its 2% annual target, and \u2014Megan Cassella and Liz Moyer<\/em><\/em><\/p>\n \n Netflix\u2019s<\/span> What\u2019s Next:<\/strong> Neumann said Netflix is focused on lifestyle sports programming, but won\u2019t be investing billions in live high-profile sporting events, because he doesn\u2019t see an immediate return. He said gaming is a \u201cdeveloping business\u201d and \u201clong-term growth opportunity\u201d with a five- to 10-year time frame.<\/p>\n \u2014Janet H. Cho<\/em><\/em><\/p>\n China hit back at the European Union Thursday, warning that the bloc\u2019s inquiry into Beijing\u2019s subsidies for electric cars will hurt China-EU economic and trade relations.<\/p>\n What\u2019s Next:<\/strong> Chinese EV makers have enjoyed early success in their European\u2014and, indeed, global\u2014expansion. The EU\u2019s investigation, and its outcome, is a sign they may not continue to have things their own way, and is a big moment in the EV race.<\/p>\n \u2014Callum Keown and Jack Denton<\/em><\/p>\n Major League Pickleball and rival PPA Tour, the sport\u2019s two largest pro associations, have rekindled their merger hopes, this time with the backing of a $50 million investment from private-equity firm SC Holdings, PPA Tour owner Tom Dundon, and some MLP owners.<\/p>\n What\u2019s Next:<\/strong> The combined league\u2019s board of directors is set to include SC Holdings\u2019 Jason Stein, who also advises basketball star LeBron James\u2019 video-production firm SpringHill; the D.C. Pickleball Team owner Al Tylis; PPA Tour\u2019s Dundon; MLP\u2019s Kuhn; and former Goldman Sachs partner Brian Levine.<\/p>\n \u2014Janet H. Cho<\/em><\/em><\/p>\n
\n Nvidia,<\/span>
\n arguably the biggest beneficiary of AI optimism and the company that tried to buy Arm just a few years ago, has had a particularly rough September.<\/p>\n***<\/h4>\n
Auto Industry Braces as UAW Strike Deadline Looms<\/h2>\n
\n Ford Motor,<\/span><\/p>\n
\n and Chrysler-maker
\n Stellantis
\n expires.<\/p>\n\n
***<\/h4>\n
August\u2019s Inflation Report Shows Fed Isn\u2019t Done Yet<\/h2>\n
\n
\n JPMorgan
\n said it won\u2019t fall below that threshold until late next year.<\/p>\n***<\/h4>\n
Netflix\u2019s CFO Offers Softer Guidance as Ad Business Grows<\/h2>\n
\n stock fell after Chief Financial Officer Spencer Neumann offered softer-than-expected guidance on margins and said the streaming company\u2019s fledgling advertising business was difficult to build from scratch and not yet material to overall revenue.<\/p>\n\n
\n Walt Disney
\n and
\n Apple.<\/span>
\n He said a \u201chealthy proportion\u201d of accounts are moving toward Netflix\u2019s ad-supported subscription tier<\/strong>, and that revenue is building in 2024.<\/p>\n<\/li>\n***<\/h4>\n
China Warns EU Over Inquiry into Electric-Vehicle Subsidies<\/h2>\n
\n
***<\/h4>\n
Pro Pickleball Leagues Flip Their Merger Back On<\/h2>\n
\n
***<\/h4>\n