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Bonds

St. Petersburg Council Approves Bonds for Rays Stadium & Gas Plant

2024-12-05

The City Council of St. Petersburg took a significant step on Thursday by approving bonds to fund a substantial portion of a $1.3 billion stadium for the Tampa Bay Rays and the surrounding Historic Gas Plant District. This decision, which came with a 4-3 vote, now places the responsibility on the Pinellas County Commission to potentially have the final say on the deal. The commission's decision could either lock in the Rays and its development partner Hines with the cost overruns the team now claims it can't afford or leave a $312.5 million gap in the project.

Delays and Tensions

During the previous council meeting on November 21, Council member Gina Driscoll pushed for a delay, emphasizing the need for the city to take a breath. Tensions had escalated at that meeting as Rays president Brian Auld indicated that the deal was dead. However, it later emerged that the Rays were still in the deal, and Driscoll urged the county to fulfill its part and see it through.The uncertainty regarding whether the Rays could fulfill their end of the deal approved in July continued to loom. Team presidents Auld and Matt Silverman wrote a letter before a commission meeting last month stating that the club could no longer afford to open a ballpark in 2029, a year later than planned due to delays in the bond votes. This led to the county and city delaying their votes and engaging in a back-and-forth in correspondence between the commission chairperson and the Rays.

Mayor's Perspective

Before the council's vote, Mayor Ken Welch, the architect of the deal, revealed that Rays owner Stuart Sternberg attended a meeting at City Hall on Tuesday. He stated that there is "consensus" that the agreements approved in July are "valid and in effect," although significant issues still remain regarding the Rays' stadium obligations. The discussions during the meeting were productive, and the options are becoming clearer.

City Administrator's Insights

City Administrator Rob Gerdes focused on the funding gap that the Rays "perceive." He suggested that the private sector could fill in these gaps through suite and name sponsorship rights. However, he also emphasized that the city cannot financially make up that gap.

Council Member's Concerns

Council member Lisset Hanewicz, a strong critic of the deal and its legal language, was disappointed that the Rays were not present during the Thursday vote. Gerdes stated that the Rays offered to attend but he believed it wasn't necessary. Hanewicz had spoken to Silverman and was told that the Rays decided not to come. She expressed her concern, stating that the deal started with a letter from the Rays and questioned how the city could approve hundreds of millions of dollars of bonds when the Rays were not present and sending out such letters.This is a developing story, and readers are encouraged to stay with tampabay.com for updates.

Stock futures on Thursday night were hovering near the flatline as investors anxiously awaited crucial payrolls data. This awaited information holds significant importance as it is expected to provide a clearer understanding of the domestic labor market's health and influence the Federal Reserve's rate decision at its December 17-18 policy meeting.

Anticipated Market Impact

With market expectations for a solid rebound in payrolls, an even stronger print above expectations could potentially force the Fed to reevaluate the pace of rate cutting next year. As stated by Charlie Ripley, senior investment strategist at Allianz Investment Management, this data will play a crucial role in shaping the future course of monetary policy.The continued strength of the U.S. economy has led Fed Chair Jerome Powell to emphasize that policymakers do not need to be in a hurry to lower rates. This stance further highlights the significance of the upcoming payrolls data in determining the trajectory of interest rates.Stock markets closed lower on Thursday, retreating from the records set in the previous session. Week to date, the S&P 500 has seen a 0.7% increase, while the tech-heavy Nasdaq Composite has gained 2.5%. The 30-stock Dow, however, is down 0.3% during the same period.

Investors' Dilemma

Investors have a mixed outlook on Friday's jobs report, which is one of the remaining major events for the market to digest before the Federal Reserve's meeting. John Flood, head of Americas equities sales trading for Goldman Sachs Global Banking & Markets, expects markets to rally on a softer report, suggesting a headline number in the 150,000 to 200,000 range is favorable for stocks. However, Goldman's official forecast reflects a 235,000 job increase in nonfarm payrolls, and Dow Jones has a consensus estimate of 214,000 jobs being added last month.This uncertainty among investors showcases the critical nature of the payrolls data and its potential to sway market sentiment.

Companies Making Big Moves

After Thursday's close, several companies made significant moves. Ulta Beauty, the beauty retailer, jumped 12% after posting better-than-expected earnings and revenue in the fiscal third quarter. It reported earnings of $5.14 per share on revenue of $2.53 billion, surpassing analysts' forecasts of $4.54 per share and $2.50 billion. The company also raised its full-year guidance.GitLab, the developer tools software maker, saw a 6% increase after posting a substantial earnings beat in the third quarter. It reported adjusted earnings of 23 cents per share on revenue of $196 million, exceeding the LSEG consensus estimate of 16 cents per share on revenue of $188 million. Additionally, the company announced a new CEO effective Thursday.Lululemon Athletica, the athletic apparel maker, also posted a quarterly beat, sending its stock more than 10% higher. It reported $2.87 per share in earnings on $2.40 billion in revenue, exceeding analysts' forecast of $2.69 per share on $2.36 billion in revenue.These companies' performances highlight the impact that strong quarterly results can have on their stock prices and the broader market.

Futures Open with Little Change

Shortly after 6 p.m. ET on Thursday, stock futures were showing little change. Futures tied to the Dow Jones Industrial Average dipped 20 points, or nearly 0.1%. S&P 500 futures edged slightly lower, while Nasdaq 100 futures shed about 0.1%. This indicates that investors are waiting with bated breath for the Friday labor data release to provide more clarity on market trends.In conclusion, the upcoming payrolls data is set to be a key determinant of market movements and the future direction of monetary policy. Investors will be closely watching for any indications that could impact their investment decisions.

Whey, often overshadowed, has emerged as the main character in the market this week. Despite spot prices remaining steady today, futures have soared, with the March, April, and July contracts reaching their limit. First quarter futures have seen a significant increase, averaging $0.7110 per hundredweight, a nearly four-cent hike from yesterday. Reports consistently highlight tight whey supplies as a crucial supportive factor. From a producer's viewpoint, the rise in dry whey is positively influencing Class III futures, as every penny movement in whey translates to six cents in Class III. Today, first quarter Class III futures inched slightly higher to $19.12 per hundredweight, despite a decline in cheese values.

Today's Market Highlights

After two days of gains, spot cheddar prices took a turn, with blocks settling at $1.6650 per pound, a decrease of 3.5 cents. Barrels also experienced a dip, settling at $1.6425 per pound, down 2.5 cents. A total of three lots of blocks and two loads of barrels were traded. The only other notable movement was in spot NDM, which climbed to $1.3825 per pound, adding $0.0125. Eight lots were exchanged.US cheese exports remained strong in October, reaching 88.8 million pounds, a 12% year-over-year increase. A significant volume of 38 million pounds was shipped to Mexico, 27% more than the same period last year. However, exports of NDM+SMP dipped to 136.5 million pounds, 4% lower than the previous year. Butter exports totaled 5 million pounds, a 22% increase compared to prior-year levels. But imports showed a substantial growth, reaching 19 million pounds, a 79% year-over-year increase.Dairy cow slaughter during the week ending November 23 reached 51,200 head, a 22.5% increase year-over-year. Although this is an improvement from the weak 2023 performance, the activity still remains well below the five-year average.Your Next Read: Agriculture Should Expect a Return to Tough Trade Tactics in Trump's Next Term

Whey's Impact on Futures

The surge in whey futures is a significant development in the market. As mentioned earlier, the March, April, and July contracts have moved limit up, indicating a strong upward trend. This increase is not only driven by tight supplies but also has implications for other dairy sectors. For example, the rise in whey is lending a bullish hand to Class III futures, creating a ripple effect throughout the dairy market. Producers are closely monitoring these movements as they have a direct impact on their bottom line.

Cheese and NDM Market Trends

The reversal in spot cheddar prices after two days of gains is a notable event. The decline in block and barrel prices shows the volatility in the cheese market. Meanwhile, the increase in spot NDM prices indicates a different trend within the dairy market. These fluctuations highlight the complexity and interdependence of different dairy products. Understanding these trends is crucial for market participants to make informed decisions.

Dairy Cow Slaughter and Market Outlook

The increase in dairy cow slaughter is a significant factor to consider. While the year-over-year growth is positive, it still lags behind the five-year average. This suggests that there may be underlying issues in the dairy industry that need to be addressed. The weak 2023 performance further emphasizes the need for a comprehensive analysis of the market. Looking ahead, it will be interesting to see how these factors play out and what impact they will have on the dairy market.