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Carvana Co (NYSE: CVNA) has been one of the quintessential millionaire makers over the past two years – but a JPMorgan analyst continues to see significant further upside in its share price in 2025.

Rajat Gupta raised his price target on CVNA this morning to $350 which indicates potential for another 40% upside from current levels.

Positive revisions followed by multiple expansions will help Carvana stock hit new highs this year, he told clients in a research note on Friday.

Financial strength supports buying Carvana stock

JPM is super bullish on Carvana shares primarily because the company’s financial health remains strong.

The online used car retailer earned 64 cents a share on $3.65 billion in revenue in its latest reported quarter. Analysts, in comparison, were at 25 cents per share only and $3.45 billion in revenue.

More importantly, the New York-listed firm expressed optimism at the time that its full-year adjusted EBITDA is on track to printing well above its previous target of up to $1.2 billion.

CVNA is now scheduled to report its Q4 earnings on February 19th. The consensus is for it to earn 25 cents a share versus a dollar of loss a year ago.

Note that Carvana stock does not currently pay a dividend.

CVNA has ample liquidity on the balance sheet

Gupta is bullish on Carvana stock also because the online used car retailer recently signed a deal with Ally Bank and Ally Financial to sell automotive finance receivables worth up to $4.0 billion.

The agreement means a significant influx of capital for CVNA that will boost its liquidity and help its growth initiatives.

The company based out of Tempe, AZ ended its third financial quarter with about $1.1 billion in total liquidity. This includes cash, cash equivalents, and available borrowing under a revolving credit facility.  

Note that Carvana shares are still trading significantly below their pandemic times high of $361.

Carvana technicals point upwards too

Investors should also know that JPM is not the only investment firm that’s positive on Carvana.

Others including Bank of America, Citi, Needham, and RBC have recently reiterated their buy ratings on shares of the online used car retailer – citing the potential for continued increase in retail unit sales.

Analysts are bullish on Carvana stock also because they expect the company to quickly grow its inventory and meet the rapidly growing consumer demand.

From a technical perspective, shares of CVNA are worth buying at the time of writing because they have recently broken above key resistance at the $234 level as shown in the chart below.

All in all, the setup looks strong for the NYSE-listed firm to rally further if its financial results come in above Street estimates on February 19th.

The post JPM raises Carvana stock target: how high could CVNA go in 2025? appeared first on Invezz

The housing market is facing a stark reality check, with sales of existing homes plummeting to a 29-year low.

The National Association of REALTORS reports that 2024 witnessed the slowest pace of existing home sales since 1995—the era of dial-up internet and Windows 95.

This chilling statistic underscores a complex issue: the confluence of scarce inventory and escalating prices, creating a perfect storm of housing unaffordability.

In 2024, the count of existing homes sold dropped to a mere 4.06 million, and the median sale price hit a record peak of $407,500, according to NAR.

The market is struggling with a severe supply shortage that continues to drive up prices to unsustainable levels.

The mortgage rate maze: why homeowners are staying put

The crux of the issue is deeply intertwined with mortgage rates.

About 80% of existing home loans are locked in at rates below 5% as of September 2024, according to CoreLogic.

It is understandable that current homeowners are loath to move from those favorable rates, especially when swapping for a current rate closer to 7% which is where average 30-year mortgages have been stuck for months.

“We’re in that trap ourselves,” Victor Currie, a California-based real estate agent told Fortune.

Our mortgage is under 2%, and it’s hard to justify giving that up until we decide to downsize or leave California and use the built-up equity to buy the next property in cash.

The allure of low-interest mortgages is keeping a significant portion of the market on the sidelines, further restricting the already limited supply of homes for sale.

Hope on the horizon? Inventory gains and new construction

Despite the gloomy picture, there is a glimmer of hope for those looking to buy in 2025.

Realtor.com predicts a surge in existing home inventory by springtime, projecting an 11.7% increase compared to 2024.

However, the solution is not as simple as increasing the inventory.

While more new construction is important, it’s not a magic bullet for the housing market’s woes.

Sarah DeFlorio, vice president of mortgage banking at William Raveis Mortgage, told the Fortune that high prices on new inventory, coupled with high mortgage rates are making the market difficult for aspiring buyers.

“It would be impossible to build enough to meet the immense need, and the very high costs of construction mean that a lot of the new product hitting the market is not affordable for your typical American family,” says DeFlorio.

She believes, “We would need to see rates dip into at least the low 5’s before people holding these low rates will even consider making a move.”

Moreover, local factors like zoning restrictions and recent wildfires, such as those in the Los Angeles area, are further delaying progress and making the situation worse, according to Currie.

“With all the regulatory hurdles we have, this region is already notoriously slow for construction and development,” says Currie.

Just getting enough qualified labor to rebuild the decimated areas is going to be a challenge, much less creating new housing to meet the demand from population growth.

New builds: a piece of the puzzle, but not a panacea

New construction can offer a respite, but its impact varies depending on the location and affordability.

According to Fortune, Jennifer Beeston, mortgage lender and senior vice president at Rate.com, highlights that while some markets offer new builds in the $200,000 to $300,000 range, regions with the most severe shortages often lack such developments.

The complexities of new builds do not end there, Beeston adds, “A lot of people are looking at new construction as a silver bullet, but it’s not.”

Prospective buyers must also thoroughly research builders to ensure the quality of construction.

Despite the overall slowdown in the existing home sales market in 2024, the last quarter of the year demonstrated an encouraging uptick.

The NAR noted that sales hit their highest point since February in December.

According to DeFlorio, even in difficult markets, life events like “marriage, kids, divorce and death” drive transactions.

Unlocking the market: creative solutions to the “lock-in” effect

The market is currently constrained by a “lock-in” effect, which will continue to impact the market until mortgage rates drop below 6%, says Beeston of Rate.com.

“I feel like 5 is the magic number, but anything below 6 you’re going to start to see movement,” she explains.

She suggests that addressing the market will require creative solutions from both government and lenders.

“Until the government comes up with something to give us incentive to sell, you’re going to see this continue to happen,” she says.

Examples of such solutions include the “portable mortgages” seen in Canada and Britain, allowing homeowners to transfer their existing mortgage to a new property.

Beeston also floats the idea of banks offering lower-than-market rates to customers with existing lower rates who want to move—a move that could potentially stimulate the market.

Navigating the 2025 housing market: strategies for buyers

While the housing market is challenging, there is hope for prospective homebuyers.

DeFlorio’s advice is, “It is very important not to try to game the rate market. Instead of focusing on what the rate is, pay more attention to the monthly payment as that is what is going to impact your bottom line.”

With careful planning, a keen understanding of the market, and the help of a knowledgeable agent, buyers can still find good options.

Beeston shares the story of a military veteran in Columbia, South Carolina, who was able to use a VA loan to purchase a $330,000 property with no down payment and a monthly payment that was competitive to the rental costs in the area.

She concludes with an encouraging statement, “There’s a lot of opportunity right now—it’s just you have to look for it.”

The post The great housing freeze: why the housing market hit a 29-year low and what’s next appeared first on Invezz

Tesla Inc (NASDAQ: TSLA) is keeping in the green this morning even though it reported a 71% decline in net income for its fourth financial quarter.

But not everyone is as optimistic about the EV stock.

Steve Westly – the company’s former board member agrees that investors would be better off selling Tesla stock unless it does two things:

  1. Launch a sub $30,000 model
  2. Fix full self-driving (FSD)

Unless TSLA delivers on these two promises, its current valuation of $1.24 trillion is not justified, Westley argued in a CNBC interview on Thursday.

Tesla needs a lower-cost model to stay ahead of the competition

Steve Westly called on the need for Tesla to launch a lower-cost model to stay competitive against Chinese rivals, particularly the Shenzhen-headquartered BYD.

He went on to criticize Tesla for being slow in rolling out new products.

The company is in dire need of a sub $30,000 model after its latest, Cybertruck, ended up being a flop, according to Westly.

Meanwhile, the China-based EV firms are introducing new models in the range of $10,000 to $20,000, with BYD setting up factories in South America, Thailand, and, most importantly, Hungary.

That’s significant since the company’s new plants suggest it’s getting ready to flood the European market with its electric vehicles.

“This is all going to put pressure on Tesla. They’ve got to get a low-cost vehicle out,” Westley added.

On the plus side, “battery prices are dropping quickly, they’re expected to drop another 50%” by the end of this decade, which should make it somewhat easier for Tesla to meet this first target.

Tesla needs to fix self-driving to justify premium valuation

Tesla stock has long enjoyed a premium because billionaire Elon Musk continues to promise full self-driving capabilities in the company’s vehicles every year.

But it has now become the need of the hour for Tesla to advance its FSD plans if it wants to grow into its premium valuation.

“They’re lagging behind Waymo, there’s a lot of catching up to do,” Westly argued.  

Tesla’s full self-driving technology is currently under investigation by the National Highway Traffic Safety Administration following multiple reports of FSD-related crashes.

A good start, according to Steve Westly, would be to secure regulatory approval for its autonomous driving system in Austin.

Note that chief executive Elon Musk expects the launch of “unsupervised full self-driving as a paid service” in Austin in June.

Westly’s remarks arrive on the heels of Tesla’s earnings for the fourth quarter.

The EV maker earned 73 cents a share as its bitcoin holdings delivered a big boost to earnings in Q4.

Still, the company came in below the 76 cents per share that analysts had forecast.

Note that Tesla stock does not pay a dividend at the time of writing.

The post Tesla’s former board member calls the stock a ‘sell’—here’s why appeared first on Invezz

Michigan-based company Dow Inc. announced Thursday that it would lay off 1,500 employees as part of a $1 billion cost-cutting initiative, citing sluggish demand and margin pressures. The announcement sent Dow’s shares tumbling 6.3% in morning trading.

Like much of the industry, the chemical giant is grappling with rising input costs and weak pricing power, particularly in Europe, where regulatory challenges have forced companies to rethink their strategies.

Focus on Europe and Asia

The company plans to implement workforce reductions worldwide, with a focus on Europe and Asia.

In addition to job cuts, Dow expects to save between $300 million and $500 million this year by streamlining expenses.

The company also provided a disappointing sales forecast for the current quarter, projecting revenue of $10.3 billion—falling short of Wall Street’s expectations of $10.78 billion, according to LSEG data.

Executives warned that higher global feedstock and energy costs continue to outpace price increases, squeezing margins. They estimate this will negatively impact earnings by approximately $100 million in the current quarter.

Dow’s largest revenue-generating segment, packaging, and specialty plastics, saw a 5.8% decline in quarterly net sales, dropping to $5.32 billion compared to the same period last year. While demand for packaging products remained strong, lower prices offset those gains.

Dow remains optimistic about polyethylene demand

Despite these challenges, Dow remains optimistic about polyethylene demand growth in North America, a key component in packaging materials. The company is also actively reviewing its European operations and expects to provide an update by mid-2025.

On the earnings front, Dow reported adjusted break-even earnings per share (EPS) for the fourth quarter, missing analysts’ expectations of 24 cents per share.

To navigate the tough market conditions, Dow announced plans to idle one of its European ethylene crackers in the second quarter, with operations set to resume once market conditions improve.

Dow’s cost-cutting strategy highlights the mounting pressures facing the chemical industry as weak global demand, rising costs, and regulatory challenges weigh on growth. While the company looks to stabilize its margins, investors remain cautious as economic uncertainties persist.

The post Dow to lay off 1,500 employees as part of $1 billion cost-cutting plan appeared first on Invezz

From school and college romances with late-night landline calls to relationships blossoming on apps that break the barriers of location and time, dating in India has come a long way.

Its evolution has also mirrored changing societal norms and gender dynamics.

The trend of using dating apps to meet a potential partner or even spouse, started with Tinder in 2013, which revolutionized the market by popularizing swipe-based dating, especially in metro cities like Delhi, Mumbai, and Bengaluru.

Since then the dating app market is gaining new players, each differentiating itself from another based on features tailor-made to suit one’s dating preferences.

Apps for extra-marital relationships, or an ‘extra-marital connection,’ if you will, are a result of this shift, and the rise of the French extra-marital dating platform Gleeden to 3 million users in India (25% of its global user base) bears testimony to the evolving landscape of marriages and long-term relationships.

Invezz had a candid chat with Sybil Shiddell, country manager for Gleeden in India, about how Indian women in marriages and long-term relationships are increasingly owning their desire to feel seen and valued beyond breadcrumbs.

This shift, Shiddell said has contributed to the rapid growth of female users, who now make up 40% of Gleeden’s user base.

The conversation also covered the company’s challenges in marketing its services, the creative strategies it has adopted to overcome them, its efforts to tap into a younger demographic, and its positioning as a platform for exploring non-monogamous relationships—not just an extra-marital dating app.

Invezz: How has Gleeden’s experience been in India since its launch?

The app was born in France back in 2009, so we have been around for a long time.

Our experience in India is now eight years old. Officially, the app was launched in India in 2018, but we started gaining users from India as early as 2017.

These users were coming spontaneously, without any marketing activity or communication about the app. It was simply available in the app stores, yet Indian users found it and subscribed.

Seeing this organic growth, we started to pay attention. It was clear that this market had potential—people were actively looking for us, finding us, and subscribing.

Less than a year later, we officially launched in India. This meant partnering with a local agency and developing a marketing strategy for the country.

Gleeden India’s growth and evolution

Honestly, I always say this—not to flatter anyone, but because it’s true—India is my favourite market.

Surprisingly, we never faced backlash, despite the controversial nature of our service.

I believe this is because our platform was understood for what it truly is: a beautiful space where people with similar desires and expectations can connect transparently, without deception.

Most of our users are satisfied with virtual companionship and do not necessarily seek anything beyond that.

Of course, some do, but for many, virtual companionship is more than enough. As a result, we never became known as an app for cheating.

This is also because our communication strategy never promoted cheating out loud.

Instead, our messaging and storytelling have always revolved around couples—helping them reconnect, rekindle their relationships, and improve their bond.

We offer advice and insights, and only if that isn’t enough do we suggest finding companionship elsewhere.

Decriminalising adultery, Covid-19 turning points for Gleeden, India

Our biggest boom in India happened in 2018. This was not only due to our structured marketing efforts but also because of a significant cultural shift.

The abrogation of Section 497 decriminalized adultery, officially opening the door for a service like ours. Since then, Gleeden has continued to grow steadily and successfully.

Another major milestone for us was COVID-19. Like all dating apps, we saw a surge in users during the pandemic.

With lockdowns and restrictions in place, people needed social connections outside their immediate circles, and dating apps provided just that.

India remains a key market for us, growing steadily each year. In 2024, we reached 3 million users—a significant achievement, considering we are a niche dating app.

Also, our strongest point, which sets us apart from other so-called “cheating apps”, is our focus on women rather than men.

We do not promote seduction, sex, or an escort-like experience. Instead, we cater to women’s needs—their desire for friendship, connections, and companionship.

This focus differentiates us from similar platforms and ensures that women feel safe within Gleeden.

Why is Gleeden a women-centric platform?

On our platform, women make the first move. They decide whom they want to talk to, when to share their pictures, and who can see them.

Profile pictures are not mandatory, adding an extra layer of privacy—users decide who gets access to their images. 

Additionally, the app is free for women, while men must pay for the service. This creates a natural entry barrier, ensuring that men who join are genuinely interested in meaningful interactions rather than casual harassment. 

When people have to pay, they are less likely to waste time or behave inappropriately, which helps maintain the quality of our user base.

Invezz: What was the motivation behind making Gleeden women-focused? Was it about maintaining quality by setting an entry barrier? 

In part, yes. But more importantly, it was our key differentiator in a competitive market.

We were not the first extramarital dating platform—Ashley Madison was already a giant in this space. Back in 2009, it was the biggest extramarital dating service out there.

However, Ashley Madison primarily targeted men and had a very masculine, brand focused on having affairs. We decided we did not want that.

Our approach was influenced by a cultural element, too. Gleeden was born in France, a country with deep-rooted traditions of courtship, romance, poetry, and dialogue.

In French culture, men are expected to make an effort to woo women. This cultural perspective shaped our vision for Gleeden.

So we wanted to translate this whole idea of extramarital relationship as something sexy, but also platonic, but also romantic. 

We wanted to be more old-fashioned, because, again, most of the time, women appreciate romance, effort, and feeling special- they want to be pursued, but nicely, and that’s why we decided to put them at the centre of our platform.

Indian women are not shy, they know what they want

Invezz: So do you see this cultural component aligning with your experience in India? Could you share some insights?

Yeah, my insights are amazing because Indian women are adventurous. They’re not shy. They know what they want, and they’re very assertive about it. 

From a foreigner’s point of view, there’s often a cliché of Indian women being submissive and “wifey”, but that is not the case.

The country is evolving rapidly, and this is true not just for the younger generation but also for older women.

Many of them, especially those in long-term relationships or marriages, know exactly what they want. 

They may already be wives, mothers, and the so-called “angels of the house,” but in their private lives, they want to explore their more daring side. 

And when they feel safe, they do so without hesitation.

So Indian women are not afraid to ask, and they get straight to the point. This is fantastic because it breaks outdated stereotypes. 

In reality, they are very contemporary women, no different from their counterparts in Western countries.

40% of Gleeden’s 3 million user base in India are women

Invezz: Out of your 3 million-user base in India, how many are women? Also, what kind of market share does Gleeden enjoy in India’s overall dating app market?

Okay, so overall, our app has just surpassed 12 million users globally. Our main market, because we’ve been there the longest, is France.

But India is now our second-largest market in terms of users, followed by Italy in third place. Given this growth, we need to maintain a consistent presence in India.

When we first started, our user base was about 20% women and 80% men. However, after nine years, we now have almost the same gender balance as in Europe—40% women and 60% men.

It’s normal for dating apps to have more male users, as they are more prone to be “out there”.

But the fact that our female audience in India has grown to nearly the same level as in Europe is a significant achievement. 

It means that we were able to talk to our main audience—women—even in India. And that makes us very proud.

Limitations faced while marketing an extra-marital dating app

As far as our marketing strategy in India goes, it differs significantly from other countries due to restrictions on direct advertising. 

Traditional channels like TV and outdoor campaigns are difficult because it is too explicit to declare what we do.

While we don’t necessarily face backlash, we encounter barriers at the entry-level, so we don’t even attempt those methods. 

Instead, we focus on sparking conversations through media, discussing topics like relationships, love, marriage, and infidelity. 

We explore questions such as the role of infidelity in marriage, the concept of non-monogamous relationships, and the silent yet growing trend of open marriages and polyamory. 

By engaging in these discussions, we position ourselves at the centre of the conversation, encouraging people to explore these ideas in a safe, virtual space through Gleeden.

We don’t promote open cheating but encourage different perspectives on relationships, allowing users to explore new connections and experiences online. 

Most of the time, it is more than enough to have these virtual “micro-affairs” which give you the kind of validation, compliments, and attention they might no longer receive from their husbands.

Often, marriages evolve into more of a companionship, resembling sibling-like relationships, where passion fades.

You still love your partner, but maybe you just need that extra attention or affection.

Also, receiving external attention can make a person feel more valued and confident, ultimately contributing positively to their primary relationship by bringing happiness and satisfaction into the home.

In addition to serious discussions, we have also taken a more mainstream, lighthearted approach. 

In September, we introduced our first stand-up comedy show focused on relationships, dating, and infidelity. 

Humour makes it easier to discuss sensitive topics, and the show was super fun.

We are now using digital content from the show—videos and reels—to build a digital strategy aimed at increasing brand awareness and reaching a younger demographic.

Younger demographic is open to trying non-monogamous relationships

Invezz: What’s the average age bracket using your platform currently?

Considering that its an extra-marital dating website, of course, its thirty. Because sometimes you must be married for a long time to actually be in need of something different. 

But now we are trying to talk about the topic also with younger generations because younger generations are considering all these kinds of non-monogamous relationships that could be found on Gleeden as well.

Invezz: So are you also trying to branch into a platform for non-monogamous relationships and not restricting yourself to being just a website for extra-marital relationships?

Yes, we are also evolving into a space where couples interested in polyamory or non-monogamy can connect safely. 

Unlike apps like Hinge, Bumble, or Tinder—which are designed for finding long-term partners—we focus on different kinds of connections.

I think the latest claim of Hinge is “the app that you have to delete” because once you find your partner, you will not need it anymore.

This is not us. We are an extramarital dating website. So it’s like—you can come to Gleeden, find somebody, then go back to your partner, then come back to Gleeden.

We are not selling eternal love, dating, or marriage. You can find it- maybe you find your soulmate, but usually, you go on traditional dating apps for that.

Geographical breakdown of user base and 2025 dating trends

Invezz: Could you also give us a breakdown of the user base geography-wise in India? I read Bangalore has the highest number of users…

Yes, Bangalore has 20% of the Indian community. It is the most important city where we have the most users, followed by Mumbai, Kolkata, Delhi, and Pune- mainly the tier-one cities because also, the mentality is more open in such cities.

Bigger cities also provide better opportunities for geolocalization. You can find a lover in the same city, but it’s not like he/she is your neighbour.

The smaller the town, the higher the risk of meeting someone you already know. But we also have users in smaller cities who actually live there but find their connections in bigger cities.

Invezz: What trends have you seen in the framework of extramarital dating or dating outside of a relationship since Gleeden launched in India? And looking ahead to 2025, what is one trend you think will stand out in dating and extramarital relationships?

Well, as we were talking about, for sure, non-monogamous relationships and non-traditional relationships.

Because long-term couples, after a while, want to expand and experiment for fun. And of course, Gleeden is a perfect place to start.

We ran a survey two years ago, and we’re going to do another one this year to analyze the trends.

When we conduct these studies, we do them with Ipsos. So they are scientifically carried out and truly give us a perception of what the country is thinking.

67% of Indians are interested in trying non-monogamous relationships

One of the findings from two years ago, which I believe is becoming even bigger, is that 67% of Indians declared they were interested in trying a non-monogamous relationship.

Also, if I remember correctly—but I will check on this number—62% had already tried this kind of relationship at least once, which was very interesting.

From a foreigner’s perspective, you always think of India as very traditional, marriage-oriented, and family-oriented.

And then you find out that behind closed doors, people are super open—even more open than Italy.

Italy is a very traditional country. We are very bored from this point of view. India is not.

So I believe this kind of relationship, or at least the desire to try, is going to grow.

The second trend we saw, which I always emphasize because it’s surprising, is single people using Gleeden.

Single people also use Gleeden for privacy concerns, commitment issues

This is wow. It’s like—why? What’s the point of a single person subscribing to Gleeden? We are openly an extramarital dating service.

But then we started investigating this phenomenon.

And basically, what single people like about Gleeden is the privacy we offer. Other dating apps are just catalogues. Your face is up there. You can find everyone—you can find your friends.

So if people don’t want to announce they are dating again, because maybe they went through a hurtful breakup or a divorce, they prefer more privacy.

Invezz: Is it also an emerging trend that single people want to get involved with married individuals or those already in relationships because they want to have a connection without the responsibility?

Exactly. Most of the time, it’s about casual dating. If I’m single and the person is married, there’s a high chance I don’t have to commit. Things are clear.

Hope to close 2025 with another million users

Invezz: How big is your team in India? Do you have an office here?

The team consists of about 10 people. There is no physical office. We don’t have one anywhere.

The office is essentially us—travelling. It’s unusual because, despite being a large platform operating in multiple countries, the actual core team is quite small. 

We prefer working with local professionals and agencies who understand the reality of each country we operate in. In terms of direct employees, we are a very small team.

Invezz: Do you have a target user base for the coming years?

I’d love to add another million users by the end of this year, but we’ll see.

When we release studies with fresh data and trends, we typically see a surge in subscriptions.

I’m ambitious and hope to close 2025 with another million users, but I don’t want to jinx it.

The post Interview: ‘Indian women are not shy, they know what they want,’ says Gleeden’s Sybil Shiddell appeared first on Invezz

The FTSE 100 index has started the year well as it surged to a record high. It moved to a high of £8,645, up by over 75% from its lowest level in 2020 and by 15% in the last 12 months. 

The next few weeks will be important for the FTSE 100 index as the Bank of England (BoE) delivers its first interest rate decision and as many constituent companies release their financial results. So, let’s explore the key catalysts for the Footsie and the top companies to watch next week.

Bank of England’s decision

The Bank of England’s decision, scheduled for Thursday next week, is the main catalyst for the FTSE 100 index. 

This will be an important meeting since analysts anticipate that the BoE will start its pivot into a more dovish view. In this, there is a likelihood that the bank will cut interest rates by 0.25% and then point to more cuts later this year. 

The BoE has been more cautious than the Federal Reserve and the European Central Bank (ECB). It slashed interest rates two times last year and maintained a cautious tone because of inflation.

The rising hopes of a dovish tone explain why UK Gilt yield have pulled back. Data shows that the 10-year trend has moved from 4.90% to 4.55%, while the 5-year trend has moved from 4.70% to 4.3%. The FTSE 100 index will likely do well if the BoE turns dovish in this meeting. 

Top corporate earnings

Corporate earnings will be the key catalysts for the FTSE 100 index next week. Diageo, the giant alcohol manufacturer and parent company of popular brands like Guinness, Johnie Walker, Baileys, and Smirnoff, will be the first big FTSE 100 company to release its financial results. 

These numbers will come at a time when the Diageo share price has been under pressure. It was trading at 2,400p, down by 37% from its highest level during the pandemic. This weak performance is in line with most alcohol stocks like AB InBev and Molson Coors.

Healthcare giants in the FTSE 100 index will also be in the spotlight next week. GSK and AstraZeneca will publish their numbers on Wednesday and Thursday. GSK share price remains in a deep bear market after falling by 21% from its highest level in 2024, while AstraZeneca has dropped by 15%. Therefore, these results will likely provide a catalyst for the two firms. 

Vodafone, the giant telecom company, will release its results on Tuesday. Like other top FTSE 100 companies, the Vodafone share price has remained under pressure in the past few months as investors watch the ongoing turnaround strategy. Its stock was reading at 68p, down by 10% from its 2024 highs.

Entain, the parent company of Ladbrokes, EuroBet, Coral, and BetMGM will also release its results at a time when there are concerns about the industry.

FTSE 100 index analysis

The weekly chart shows that the FTSE 100 index made a strong bullish breakout and hit a record high this week. It moved above the important resistance level at £8,476, the previous all-time high and the upper side of the ascending triangle pattern. The FTSE 100 index has remained above the 50-week moving average. 

Therefore, the FTSE 100 index will likely continue rising as bulls target the key psychological point at £9,000.

The post FTSE 100 forecast: BoE decision, Diageo, Vodafone, GSK earnings appeared first on Invezz

The Governing Council decided on Thursday to cut the three core ECB interest rates by 25 basis points.

As a result, the interest rates on the deposit facility, major refinancing operations, and marginal lending facility will be reduced to 2.75%, 2.90%, and 3.15%, respectively, beginning February 5, 2025.

This decision is primarily focused on lowering the deposit facility rate; the Governing Council regards it as a fundamental tool for steering its monetary policy.

According to the statement released by the bank, the adjustment is based on the most recent inflation projection, core inflation trends, and the overall efficacy of monetary policy transmission.

Disinflation is progressing as predicted by the ECB

The ECB indicated that the disinflationary process was progressing as predicted.

Current inflation rates are essentially consistent with the bank’s staff predictions and are likely to return to the Governing Council’s medium-term target of 2% this year.

The majority of core inflation indicators point to long-term inflation remaining close to the target level. Nevertheless, domestic inflation remains high.

This is primarily due to the slow pace of pay and price changes in specific sectors that suffered significant inflation rates in the past.

On the positive side, wage growth supports projections of lower corporate profit margins, which will further restrain inflation.

Easier financing conditions for families and companies

The Governing Council’s latest rate drop will likely make borrowing less expensive than before for both families and businesses.

This decision is expected to stimulate investment and consumer spending, which have historically been the primary drivers of economic growth.

Regardless of the lower interest rates, financing circumstances remain tight.

The loan market reflects the ongoing tightening of monetary policy as well as the delayed impact of the recent interest rate hike.

Some aged loans are rolled over at a higher cost, affecting some borrowers badly.

However, the forecast for the broader economy is not without issues.

The eurozone economy is still dealing with a slew of negative circumstances, including supply chain issues and continuous geopolitical tensions that are disrupting market operations.

However, rising household income levels and the gradually declining negative impact of previous restrictive monetary policies are likely to increase demand, allowing boosting economic activity.

Inflation remains stable over the long term

The bank’s Governing Council continues to deepen its commitment to stabilizing inflation around the 2% threshold through a variety of approaches, including managing the money supply.

To achieve this purpose, the Council will rely on the data method, which will be utilized to make monetary policy choices at each meeting using the most recent economic and financial data available.

“The Governing Council stands ready to adjust all of its instruments within its mandate to ensure that inflation stabilises sustainably at its 2% target over the medium term and to preserve the smooth functioning of monetary policy transmission.”, said the bank in the statement.

In particular, the Council’s interest rate choices will be based on a consideration of the current inflation perspective, side inflation, and the overall effectiveness of monetary policy concerning the real economy.

The Governing Council does not commit to any precise path for future interest rate setting.

This margin of manoeuvre enables the Council to be as politically attentive as necessary to changing economic circumstances and to adjust its policies regarding the inflow of new data and abstract economic indicators shortly.

Economic implications for the eurozone

The move to lower interest rates comes at a key juncture for the eurozone, whose economic recovery has been uneven.

This decision has the potential to significantly boost consumer confidence and company investment. As borrowing costs fall, people may be more likely to spend, while firms may invest more in growth activities.

Finally, the ECB’s decision to decrease interest rates demonstrates its proactive approach to promoting economic recovery and maintaining price stability.

As the eurozone confronts new challenges, the Governing Council’s approach will be critical in negotiating the intricacies of the current economic situation.

Ongoing assessments and flexible policy adjustments will be critical in guiding the region back to strong economic health and stable inflation rates.

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The number of Americans filing for unemployment benefits dropped more than expected last week, signaling a still-resilient labor market despite slowing job opportunities.

Initial jobless claims fell by 16,000 to a seasonally adjusted 207,000 for the week ending Jan. 25, according to the Labor Department.

This was well below economists’ forecast of 220,000, reinforcing the view that layoffs remain low even as hiring slows.

However, while claims remain at levels consistent with a stable labor market, consumer confidence in job security is waning.

A recent Conference Board survey showed that the share of Americans who view jobs as “plentiful” fell to a four-month low in January, while the proportion who see jobs as “hard to get” reached its highest level since October.

US GDP growth in Q4 2024 was 2.3%

At the same time, the US economy continued to defy expectations of a sharp slowdown, expanding at an annualized 2.3% in the fourth quarter of 2024.

Consumer spending, which accounts for the largest share of economic activity, grew at a strong 4.2% pace, marking back-to-back quarters of solid gains.

A surge in motor vehicle sales led the way, offsetting drags from a Boeing strike and weaker business investment.

Yet, concerns over economic uncertainty persist as companies scale back hiring amid tight monetary policy and anticipation of policy shifts under President Donald Trump’s new administration.

Businesses are waiting to assess the impact of potential tax cuts, tariffs, and immigration policies before committing to workforce expansion.

The Federal Reserve, which left interest rates unchanged in its latest policy meeting, signaled a cautious approach toward future rate cuts.

Chair Jerome Powell noted that policymakers need to see more progress on inflation before making adjustments, emphasizing that the central bank is in no rush to shift its stance.

Meanwhile, underlying inflation rose at a 2.5% annualized rate in the fourth quarter, marking only the second quarterly acceleration since late 2022.

This reinforces the Fed’s cautious stance on easing policy too soon.

While the labor market remains resilient for now, the decline in continuing jobless claims—down 42,000 to 1.858 million—suggests hiring may be slowing.

Looking ahead, the economic outlook for 2025 points to more moderate growth, with GDP expected to cool to around 2.2%, according to Bloomberg forecasts.

Adding to the uncertainty, Trump’s administration is preparing to implement new tariffs, potentially as soon as this weekend, aimed at boosting domestic manufacturing.

While the president argues these measures will bring factory jobs back and reduce the trade deficit, history suggests otherwise—his first-term tariffs led to a decline in factory employment and industrial output.

For now, the US economy continues to outperform global peers, thanks to a strong labor market and steady consumer spending.

However, with hiring slowing and inflation still above target, all eyes remain on how the Fed and the White House navigate the road ahead.

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The housing market is facing a stark reality check, with sales of existing homes plummeting to a 29-year low.

The National Association of REALTORS reports that 2024 witnessed the slowest pace of existing home sales since 1995—the era of dial-up internet and Windows 95.

This chilling statistic underscores a complex issue: the confluence of scarce inventory and escalating prices, creating a perfect storm of housing unaffordability.

In 2024, the count of existing homes sold dropped to a mere 4.06 million, and the median sale price hit a record peak of $407,500, according to NAR.

The market is struggling with a severe supply shortage that continues to drive up prices to unsustainable levels.

The mortgage rate maze: why homeowners are staying put

The crux of the issue is deeply intertwined with mortgage rates.

About 80% of existing home loans are locked in at rates below 5% as of September 2024, according to CoreLogic.

It is understandable that current homeowners are loath to move from those favorable rates, especially when swapping for a current rate closer to 7% which is where average 30-year mortgages have been stuck for months.

“We’re in that trap ourselves,” Victor Currie, a California-based real estate agent told Fortune.

Our mortgage is under 2%, and it’s hard to justify giving that up until we decide to downsize or leave California and use the built-up equity to buy the next property in cash.

The allure of low-interest mortgages is keeping a significant portion of the market on the sidelines, further restricting the already limited supply of homes for sale.

Hope on the horizon? Inventory gains and new construction

Despite the gloomy picture, there is a glimmer of hope for those looking to buy in 2025.

Realtor.com predicts a surge in existing home inventory by springtime, projecting an 11.7% increase compared to 2024.

However, the solution is not as simple as increasing the inventory.

While more new construction is important, it’s not a magic bullet for the housing market’s woes.

Sarah DeFlorio, vice president of mortgage banking at William Raveis Mortgage, told the Fortune that high prices on new inventory, coupled with high mortgage rates are making the market difficult for aspiring buyers.

“It would be impossible to build enough to meet the immense need, and the very high costs of construction mean that a lot of the new product hitting the market is not affordable for your typical American family,” says DeFlorio.

She believes, “We would need to see rates dip into at least the low 5’s before people holding these low rates will even consider making a move.”

Moreover, local factors like zoning restrictions and recent wildfires, such as those in the Los Angeles area, are further delaying progress and making the situation worse, according to Currie.

“With all the regulatory hurdles we have, this region is already notoriously slow for construction and development,” says Currie.

Just getting enough qualified labor to rebuild the decimated areas is going to be a challenge, much less creating new housing to meet the demand from population growth.

New builds: a piece of the puzzle, but not a panacea

New construction can offer a respite, but its impact varies depending on the location and affordability.

According to Fortune, Jennifer Beeston, mortgage lender and senior vice president at Rate.com, highlights that while some markets offer new builds in the $200,000 to $300,000 range, regions with the most severe shortages often lack such developments.

The complexities of new builds do not end there, Beeston adds, “A lot of people are looking at new construction as a silver bullet, but it’s not.”

Prospective buyers must also thoroughly research builders to ensure the quality of construction.

Despite the overall slowdown in the existing home sales market in 2024, the last quarter of the year demonstrated an encouraging uptick.

The NAR noted that sales hit their highest point since February in December.

According to DeFlorio, even in difficult markets, life events like “marriage, kids, divorce and death” drive transactions.

Unlocking the market: creative solutions to the “lock-in” effect

The market is currently constrained by a “lock-in” effect, which will continue to impact the market until mortgage rates drop below 6%, says Beeston of Rate.com.

“I feel like 5 is the magic number, but anything below 6 you’re going to start to see movement,” she explains.

She suggests that addressing the market will require creative solutions from both government and lenders.

“Until the government comes up with something to give us incentive to sell, you’re going to see this continue to happen,” she says.

Examples of such solutions include the “portable mortgages” seen in Canada and Britain, allowing homeowners to transfer their existing mortgage to a new property.

Beeston also floats the idea of banks offering lower-than-market rates to customers with existing lower rates who want to move—a move that could potentially stimulate the market.

Navigating the 2025 housing market: strategies for buyers

While the housing market is challenging, there is hope for prospective homebuyers.

DeFlorio’s advice is, “It is very important not to try to game the rate market. Instead of focusing on what the rate is, pay more attention to the monthly payment as that is what is going to impact your bottom line.”

With careful planning, a keen understanding of the market, and the help of a knowledgeable agent, buyers can still find good options.

Beeston shares the story of a military veteran in Columbia, South Carolina, who was able to use a VA loan to purchase a $330,000 property with no down payment and a monthly payment that was competitive to the rental costs in the area.

She concludes with an encouraging statement, “There’s a lot of opportunity right now—it’s just you have to look for it.”

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Michigan-based company Dow Inc. announced Thursday that it would lay off 1,500 employees as part of a $1 billion cost-cutting initiative, citing sluggish demand and margin pressures. The announcement sent Dow’s shares tumbling 6.3% in morning trading.

Like much of the industry, the chemical giant is grappling with rising input costs and weak pricing power, particularly in Europe, where regulatory challenges have forced companies to rethink their strategies.

Focus on Europe and Asia

The company plans to implement workforce reductions worldwide, with a focus on Europe and Asia.

In addition to job cuts, Dow expects to save between $300 million and $500 million this year by streamlining expenses.

The company also provided a disappointing sales forecast for the current quarter, projecting revenue of $10.3 billion—falling short of Wall Street’s expectations of $10.78 billion, according to LSEG data.

Executives warned that higher global feedstock and energy costs continue to outpace price increases, squeezing margins. They estimate this will negatively impact earnings by approximately $100 million in the current quarter.

Dow’s largest revenue-generating segment, packaging, and specialty plastics, saw a 5.8% decline in quarterly net sales, dropping to $5.32 billion compared to the same period last year. While demand for packaging products remained strong, lower prices offset those gains.

Dow remains optimistic about polyethylene demand

Despite these challenges, Dow remains optimistic about polyethylene demand growth in North America, a key component in packaging materials. The company is also actively reviewing its European operations and expects to provide an update by mid-2025.

On the earnings front, Dow reported adjusted break-even earnings per share (EPS) for the fourth quarter, missing analysts’ expectations of 24 cents per share.

To navigate the tough market conditions, Dow announced plans to idle one of its European ethylene crackers in the second quarter, with operations set to resume once market conditions improve.

Dow’s cost-cutting strategy highlights the mounting pressures facing the chemical industry as weak global demand, rising costs, and regulatory challenges weigh on growth. While the company looks to stabilize its margins, investors remain cautious as economic uncertainties persist.

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