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Market news

8 November 2019
  • 20:00

    DJIA -0.18% 27,625.47 -49.33 Nasdaq +0.17% 8,449.16 +14.65 S&P -0.01% 3,084.95 -0.23

  • 18:03

    U.S.: Baker Hughes Oil Rig Count, November 684

  • 17:01

    Основные фондовые индексы Европы завершили сессию в минусе: FTSE 100 7,359.38 -47.03 -0.63% DAX 13,228.56 -60.90 -0.46% CAC 40 5,889.70 -1.29 -0.02%

  • 15:53

    Canada's hiring turns negative in October - TD Securities

    TD Securities' analysts note that the latest jobs report from Canada showed the country's labour market shed 1.8k jobs in October (consensus: +15k), and the underlying details were soft as the economy added part-time positions while losing full-time jobs.

    • "The unemployment rate was unchanged at 5.5%. After an impressive run through the bulk of 2019, the labour market was due to fall back to earth at some point.
    • The 6-month average pace of hiring still stands at 22k, which is slightly above the economy's trend pace - and with wage growth edging higher again in October the labour market is tight overall. We still expect the Bank of Canada to cut rates in January, but the state of the labour market is the least of their worries.
    • CAD rates outperformed sharply versus the US following the data, and the poor print broadly fits with our theme of Canadian outperformance versus other developed markets."

  • 15:28

    U.S. wholesale inventories down 0.4 percent in September

    The Commerce Department announced on Friday the U.S. wholesale inventories dropped 0.4 percent m-o-m in September, following a revised 0.1 percent m-o-m gain in August (originally unchanged m-o-m). That marked the largest monthly fall since October 2017.

    Economists had forecast wholesale inventories declining 0.3 percent m-o-m in September.

    According to the report, stocks of durable goods edged down 0.1 percent m-o-m after gaining 0.2 percent m-o-m in August, while inventories of nondurable goods fell 0.9 percent m-o-m, following a 0.1 percent m-o-m decrease in the previous month.

    On a y-o-y basis, wholesale inventories rose 4.8 percent.

  • 15:12

    U.S. President Trump says he has not agreed to tariff rollback

    • But China ‘would like’ him to do that
    • China wants to make trade deal

  • 15:06

    U.S. consumer sentiment index rises less than expected in early November

    A report from the University of Michigan revealed on Friday the preliminary reading for the Reuters/Michigan index of consumer sentiment rose to 95.7 in early November. 

    Economists had expected the index would increase to 95.9 this month from October’s final reading of 95.5.

    According to the report, the index of current U.S. economic conditions decreased to 110.9 in November from 113.2 in the previous month. Meanwhile, the index of consumer expectations grew to 85.9 this month from 84.2 in October.

    Consumers did voice a slightly more positive outlook for the economy, which was offset by a slightly less favorable outlook for their own personal finances, the report noted. At the same time, spontaneous negative references to tariffs were still mentioned by one-in-four consumers in early November, while references to the impact of impeachment on economic prospects were virtually non-existent, mentioned by less than 2% in October and November.

  • 15:00

    U.S.: Reuters/Michigan Consumer Sentiment Index, November 95.7 (forecast 95.9)

  • 15:00

    U.S.: Wholesale Inventories, September -0.4% (forecast -0.3%)

  • 14:46

    Next week's major data releases – Nordea

    According to analysts at Nordea Markets, next week, the most important releases will be the more forward-looking sentiment indicators, such as Germany’s ZEW expectations on Tuesday 12 November and the US NFIB small business survey that same day.

    • “Germany’s ZEW expectations index has improved after hitting its lowest level since 2011 back in August. The latest Sentix survey suggests that ZEW likely improved further in November. If the ZEW expectations index does improve, while the numbers will still likely suggest downside risks to ECB’s growth forecasts, the figures will be interpreted as if the EA has finally turned a corner and easier financial conditions are finally doing their (positive) thing.
    • The US small business survey NFIB rarely creates more than a ripple in financial markets, but since small businesses are key for job creation, we like to pay attention anyway. Here we note that its most recent job opening numbers, while high, seem to be consistent with a looming recession. The last five times NFIB momentum deteriorated as quickly as it has done over the past year, the US was in or about to enter a new recession. In 1979 the US entered a recession four months later. In 1981 the economy had been in a recession for three months. In 1989 a recession followed 11 months later. In March 2001 the recession started that same month, and in 2007 the recession followed eight months later. Economic or equity bulls are likely hoping that the recent weakening reflects temporary trade war concerns and that these numbers will rebound shortly.
    • US retail sales growth for October is due on Friday, and here the consensus is looking for a robust pick-up. Consumption growth has been resilient – more resilient than it should be vs our models. Perhaps part of this resilience can be explained by households’ front-running shopping ahead of what was supposed to be Trump’s tariff hikes on Chinese goods? If so, we could be in for a disappointment in the week to come.”


  • 14:34

    U.S. Stocks open: Dow -0.03%, Nasdaq -0.23%, S&P -0.17%

  • 14:25

    China posts strong trade data for October - TDS

    Analysts at TD Securities note that China’s October trade data came out better than expected, with exports at -0.9% y/y (mkt -3.9%, TD -1.3% y/y) and imports at -6.4% y/y (mkt -7.8% y/y, TD -10.2% y/y).

    • “The trade surplus was bigger than expected at $42.81bn (mkt $40.1bn, TD 42bn). China's overall trade surplus continues to grow, with the rolling 12m surplus rising to $440.1bn, its highest since July 2017.
    • China's trade surplus with the US increased to $26.4bn, but narrowed on a 12m basis to its smallest surplus since Oct 18 at $313bn. Trade Exports and imports to the US dropped by 16.2% and 14.3%, respectively.”

  • 14:18

    Before the bell: S&P futures -0.09%, NASDAQ futures -0.17%

    U.S. stock-index futures were little-changed on Friday as investors assessed the latest developments in U.S.-China trade negotiations and a fresh round of earnings reports.


    Global Stocks:

    Index/commodity

    Last

    Today's Change, points

    Today's Change, %

    Nikkei

    23,391.87

    +61.55

    +0.26%

    Hang Seng

    27,651.14

    -196.09

    -0.70%

    Shanghai

    2,964.18

    -14.53

    -0.49%

    S&P/ASX

    6,724.10

    -2.50

    -0.04%

    FTSE

    7,365.41

    -41.00

    -0.55%

    CAC

    5,873.15

    -17.84

    -0.30%

    DAX

    13,233.64

    -55.82

    -0.42%

    Crude oil

    $56.26


    -1.56%

    Gold

    $1,461.40


    -0.35%

  • 14:09

    Atlanta Fed President Bostic: Risks to the economy are still out there

    • I think we are slightly accommodative
    • We don't have that much space in a downturn
    • Risks to the economy are still out there, much hasn't not been resolved
    • Filling entry-level jobs is extremely competitive
    • We are seeing competition and that's showing up in wages
    • Seeing significant pay jumps for people changing jobs

  • 13:57

    Wall Street. Stocks before the bell

    (company / ticker / price / change ($/%) / volume)


    3M Co

    MMM

    176.15

    2.15(1.24%)

    3644

    ALTRIA GROUP INC.

    MO

    46.08

    0.17(0.37%)

    5007

    Amazon.com Inc., NASDAQ

    AMZN

    1,803.00

    7.23(0.40%)

    17843

    AMERICAN INTERNATIONAL GROUP

    AIG

    55.75

    0.23(0.41%)

    2317

    Apple Inc.

    AAPL

    258.5

    2.03(0.79%)

    226509

    AT&T Inc

    T

    39.3

    0.05(0.13%)

    37195

    Boeing Co

    BA

    356

    3.87(1.10%)

    28264

    Caterpillar Inc

    CAT

    147.1

    1.61(1.11%)

    8591

    Cisco Systems Inc

    CSCO

    48.62

    0.35(0.73%)

    21815

    Citigroup Inc., NYSE

    C

    75.49

    1.07(1.44%)

    33630

    Deere & Company, NYSE

    DE

    177

    1.03(0.59%)

    746

    E. I. du Pont de Nemours and Co

    DD

    71

    0.67(0.95%)

    800

    Exxon Mobil Corp

    XOM

    72

    0.51(0.71%)

    10150

    Facebook, Inc.

    FB

    192.35

    0.80(0.42%)

    41042

    FedEx Corporation, NYSE

    FDX

    165.25

    2.08(1.27%)

    4638

    Ford Motor Co.

    F

    9

    0.08(0.90%)

    199064

    Freeport-McMoRan Copper & Gold Inc., NYSE

    FCX

    10.96

    0.32(3.01%)

    36203

    General Electric Co

    GE

    11.1

    0.08(0.73%)

    200450

    General Motors Company, NYSE

    GM

    38.81

    0.39(1.02%)

    3848

    Goldman Sachs

    GS

    221

    2.58(1.18%)

    6213

    Google Inc.

    GOOG

    1,296.90

    5.10(0.39%)

    3391

    Hewlett-Packard Co.

    HPQ

    19.73

    0.16(0.82%)

    50592

    Home Depot Inc

    HD

    234.85

    0.84(0.36%)

    1657

    HONEYWELL INTERNATIONAL INC.

    HON

    181.05

    0.24(0.13%)

    197

    Intel Corp

    INTC

    58.14

    0.54(0.94%)

    42839

    International Business Machines Co...

    IBM

    138

    0.84(0.61%)

    13778

    Johnson & Johnson

    JNJ

    131.4

    0.44(0.34%)

    4364

    JPMorgan Chase and Co

    JPM

    130.7

    1.40(1.08%)

    9620

    McDonald's Corp

    MCD

    195.59

    1.41(0.73%)

    17139

    Merck & Co Inc

    MRK

    83.4

    0.15(0.18%)

    4300

    Microsoft Corp

    MSFT

    144.57

    0.51(0.35%)

    71251

    Nike

    NKE

    90.65

    1.17(1.31%)

    10775

    Pfizer Inc

    PFE

    37.3

    0.05(0.13%)

    25726

    Procter & Gamble Co

    PG

    119.85

    -0.47(-0.39%)

    5872

    Starbucks Corporation, NASDAQ

    SBUX

    83.15

    0.16(0.19%)

    16372

    Tesla Motors, Inc., NASDAQ

    TSLA

    329.54

    2.96(0.91%)

    107021

    The Coca-Cola Co

    KO

    52.76

    -0.04(-0.08%)

    16581

    Twitter, Inc., NYSE

    TWTR

    29.07

    -0.47(-1.59%)

    380560

    United Technologies Corp

    UTX

    149.15

    0.84(0.57%)

    899

    UnitedHealth Group Inc

    UNH

    251.98

    1.46(0.58%)

    1074

    Verizon Communications Inc

    VZ

    60.2

    0.07(0.12%)

    5864

    Visa

    V

    177.2

    0.43(0.24%)

    15834

    Wal-Mart Stores Inc

    WMT

    120.1

    0.60(0.50%)

    23150

    Walt Disney Co

    DIS

    132.4

    1.13(0.86%)

    61970

    Yandex N.V., NASDAQ

    YNDX

    34.35

    0.15(0.44%)

    1972

  • 13:53

    Canada’s building permits drop more than anticipated in September

    Statistics Canada announced on Friday that the value of building permits issued by the Canadian municipalities fell 6.5 percent m-o-m in September, following a revised 5.6 percent m-o-m surge in August (originally a 6.1 percent m-o-m increase).

    Economists had forecast a 2.0 percent drop in September from the previous month.

    According to the report, the value of residential permits tumbled 1107 percent m-o-m in September, as permits for multi-family dwellings plunged by 12.1 percent m-o-m, and single-family permits dropped by 8.7 percent m-o-m.

    At the same time, the value of non-residential building permits increased 0.9 percent m-o-m in September, due to a climb in commercial (+6.1 percent m-o-m) permits, which, however, were offset by declines in industrial (-8.1 percent m-o-m) and institutional (-5.0 percent m-o-m) permits.

    In y-o-y terms, building permits rose 2.1 percent in September.

  • 13:44

    Initiations before the market open

    Home Depot (HD) initiated with a Neutral at Nomura Instinet; target $240

    Walmart (WMT) initiated with a Buy at Nomura Instinet; target $132

  • 13:44

    Upgrades before the market open

    McDonald's (MCD) upgraded to Buy from Neutral at Longbow; target $227

  • 13:43

    Canada shads 1,800 new jobs in October; unemployment rate stays at 5.5 percent

    Statistics Canada reported on Friday that the number of employed people reduced by 1,800 m-o-m in October, while economists had forecast a gain of 15,900 and after an unrevised climb of 53.700 in the previous month.

    Meanwhile, Canada's unemployment remained unchanged at 5.5 percent in October, matching economists’ forecast.

    According to the report, full-time employment decreased by 16,100 (or -0.1 percent m-o-m) in October, while part-time jobs rose by 14,300 (or +0.4 percent m-o-m).

    In October, the number of public sector employees grew by 28,700 (+0.7 percent m-o-m), while the number of private sector employees declined by merely 2,700 (flat m-o-m). At the same time, the number of self-employed dropped by 27,800 (-0.9 percent m-o-m) last month.

    Sector-wise, employment declined in manufacturing (-23,000 jobs) and construction (-21,000), but rose in public administration (+20,000) and in finance, insurance, real estate, rental and leasing (+18,000).

    On a year-over-year basis, employment grew by 443,000 (+2.4 percent) in October, helped by gains in both full- (+338,000 or +2.2 percent) and part-time work (+104,100 or +3.0 percent).

  • 13:31

    Canada: Housing Starts, October 202 (forecast 221.2)

  • 13:30

    Canada: Building Permits (MoM) , September -6.5% (forecast -2%)

  • 13:30

    Canada: Employment , October -1.8 (forecast 15.9)

  • 13:30

    Canada: Unemployment rate, October 5.5% (forecast 5.5%)

  • 13:24

    Canada’s housing starts down 8.7 percent m-o-m in October

    The Canada Mortgage and Housing Corp. (CMHC) reported on Friday the seasonally adjusted annual rate of housing starts was at 201,973 units in October, down 8.7 percent from a downwardly revised 221,135 units in September (originally 221,202 units).

    Economists had forecast an annual pace of 221,200 for October.

    According to the report, urban starts plunged by 9.0 percent m-o-m last month to 189,304 units, as multiple urban starts tumbled by 12.5 percent m-o-m to 139,518 units, while single-detached urban starts rose by 2.4 percent m-o-m to 49,786 units. At the same time, rural starts were estimated at a seasonally adjusted annual rate of 12,669 units, down 3.0 percent m-o-m.

  • 13:02

    Spain: PSOE-led minority government most likely outcome - ING

    Steven Trypsteen, an economist at ING, notes that the latest polls show that Spain's Socialist Workers Party, the PSOE, should remain the largest party but may lose some votes compared to the April election. 

    • "The party is projected to receive 27% of the vote, giving it about 117 seats. In April, it received 29% of the vote and 123 seats. The People's Party (PP), on the other hand, is forecast to do better, with polls showing that it will receive 20% of the vote, up from 17%. This has a large impact on seats, potentially rising to 90 - a gain of 24 compared to the previous election.
    • The two main opponents who challenged the two traditional parties (the PP and the PSOE) after the financial and eurozone crisis are likely to lose votes and seats, according to the latest polls. Citizens could get half of the votes received back in April, falling to just 8% from 16%. In terms of seats, this suggests a drop to just 14 from 57, limiting the party's power. The left-wing Podemos is also projected to lose some votes, though the fall may be less dramatic compared to Citizens. The party may get 13% of the vote compared to 14% during the previous election. This implies 34 seats in parliament, down 8 from the last election.
    • Voting intentions appear to have changed since the April election. But these changes will not make it easier to form a government so the political situation is likely to remain difficult after this weekend’s vote. Still, pressure to find a solution after four elections in as many years will rise. In our view, a minority government led by the PSOE is the most likely outcome."

  • 12:40

    Company News: Walt Disney (DIS) quarterly earnings beat analysts’ estimate

    Walt Disney (DIS) reported Q4 FY 2019 earnings of $1.07 per share (versus $1.48 in Q4 FY 2018), beating analysts’ consensus estimate of $0.97.

    The company’s quarterly revenues amounted to $19.100 bln (+33.7% y/y), generally in line with analysts’ consensus estimate of $19.023 bln.

    DIS rose to $140.94 (+6.00%) in pre-market trading.

  • 12:16

    Scotland's first minister Sturgeon: SNP will seek to form a progressive alliance to lock conservatives out of government

    • If the SNP wins the election in Scotland the question should be to London Parliament what gives you the right to stop independence vote 
    • Will look to form alliances in Parliament to stop Brexit
    • Would drive a hard bargain to give support to a party to form government

  • 11:58

    U.S. consumer sentiment index likely to remain unchanged in November – TDS

    Analysts at TD Securities note that the market is expecting the University of Michigan's consumer sentiment index to remain unchanged at 95.5 for November, which would maintain the index at still solid, post-crisis levels.

    • “Fed Governors Brainard and Williams will participate in public events after the NY market close, but we don't expect them to deviate much from the FOMC's policy message."

  • 11:39

    German Finance Minister Scholz says economy is not close to a real recession

    • Says slower growth is caused by to trade tensions
    • Slowdown is manmade, if trade tensions cease this will have a good impact on the global economy
    • We have a very expansionary financial policy, an all-time high in public investment

  • 11:20

    Canada's economy likely to add 25k jobs in October – TDS

    Analysts at TD Securities are expecting the Canadian economy to add 25k jobs in October, well above the market consensus for 15k.

    • “Temporary federal election hiring will provide a significant tailwind to the headline print; in the previous three election cycles, public administration employment rose by 32k on average during the month of the vote. This will push the unemployment rate back to its cycle low of 5.4%, while muted base-effects should see wage growth firm to 4.4% (market: 5.5%, 4.2%).
    • October housing starts will be release shortly ahead of the LFS; we look for a modest pickup to a 229k pace from 221k in September (market: 220k), consistent with sustained momentum in residential investment into Q4. At 13:30 ET we will hear from BoC Deputy Governor Beaudry when he delivers the opening remarks to the John Kuszczak Memorial Lecture.”

  • 10:59

    Spain: Elections in focus this weekend – Rabobank

    Rabobank analysts point out that this weekend will see an election in Spain which are unlikely to break the deadlock in the Spanish parliament.

    “The PSOE is set to win the elections again, but forming a majority seems impossible. The radical right party Vox is set to gain substantially (one opinion poll has it on 16%, amazing considering the far right was negligible in Spain just a few years ago), while the liberal Ciudadanos will lose. While Spain’s economy is likely to continue to grow relatively fast in the short term, it is highly unlikely that the next parliament will deal with economic and fiscal challenges that hamper economic growth and public debt sustainability in the longer run.”

  • 10:40

    China: Exports stabilise but uncertainty clouds yuan – ING

    Iris Pang, economist at ING, notes that China’s exports contracted 0.9% year-on-year in October after contracting 3.2%YoY in the previous month.

    “Some export items experienced clear growth on a monthly basis, for example, automatic data processing parts and products (+14%MoM). This could be a result of increased smartphone orders. But exports may contract again in November and December, as exports for Western holidays will have already been shipped. Imports contracted 6.4%YoY in October after an 8.3%YoY contraction in September. The market has reacted positively to the news about a potential phase one deal, especially the possible rollback of tariffs imposed in September on $112 billion of goods. We think USD/CNY will reflect these uncertainties once the market realises that the phase one deal is not a one-way bet.”

  • 10:19

    Trump will not impose tariffs on European cars - EU chief

    The United States won’t be announcing tariffs on European cars next week, according to Jean-Claude Juncker, the outgoing president of the European Commission.

    U.S. President Donald Trump has until November 13 to decide whether to apply new duties on European carmakers. This after Trump argued in May that U.S. imports of European autos pose a national security threat to the U.S.

    In an interview with the German newspaper, Sueddeutsche Zeitung, Juncker, who leads the EU’s executive arm, said Trump will not go ahead with new tariffs. “Trump will ruffle a bit, but there will be no automobile tariffs” Juncker told the German newspaper, according to Google translate.

    The trade relationship between the U.S. and the EU has been tense since Trump came to power and ended negotiations for a trade deal with Europe that the previous U.S. administration was conducting. Furthermore, last year, Trump announced steel and aluminium tariffs on Europe. The EU retaliated a few months later with duties on 2.8 billion euros of U.S. goods. More recently, the U.S. announced tariffs on $7.5 billion of European goods in October. This decision was related to a dispute at the World Trade Organization (WTO) over subsidies to airlines.

  • 10:00

    ECB's Vasle says ECB to continue with present policy until conditions improve

    The European Central Bank is determined to continue with its present monetary policy until conditions improve, ECB governing council member Bostjan Vasle told a banking conference on Friday.

    He said the ECB believes interest rates would remain at a low level for a "longer period of time", adding the ECB policy was aiming to influence short-term and long-term interest rates.

    He also called upon euro zone states to accompany the ECB's monetary policy with structural and fiscal reforms.

  • 09:39

    GBP/USD risks a deeper retracement – UOB

    A close below 1.2770 in Cable could lead to further losses to the 1.2700 handle, suggested FX Strategists at UOB Group.

    24-hour view: “We expected GBP to “drift lower to 1.2835” yesterday but were of the view “the next support at 1.2800 is not expected to come into the picture”. The subsequent GBP weakness exceeded our expectation as GBP edged to a low of 1.2794 before recovering. While the swift decline appears to be running ahead of itself, the weakness is not showing sign of stabilization just yet. From here, GBP could move below 1.2800 again even though the next support at 1.2770 could be just out of reach for today. Resistance is at 1.2840 followed by 1.2865”.

    Next 1-3 weeks: “While we expected GBP to trade sideways since last Tuesday (29 Oct, spot at 1.2855), we detected the weakened underlying tone yesterday (07 Nov, spot 1.2860) and highlighted that GBP is likely to “probe the bottom” of the expected 1.2770/1.2930 range first. GBP subsequently dropped sharply to 1.2794 before ending the day on a weak note (1.2814, -0.33%). The price action has increased the risk of a deeper pullback in GBP. From here, if GBP were to register a NY closing below 1.2770, GBP could decline further to 1.2700. All in, GBP is expected to stay on the back foot unless it can recover above 1.2885 (‘strong resistance’ level)”.

  • 09:20

    China car sales keep falling as peak season fails to deliver - CPCA

    China’s car-market gloom continued in October as the traditional post-holiday demand peak failed to materialize, leaving automakers with few easy answers to attract buyers back to showrooms.

    Sales of sedans, sport utility vehicles, minivans and multipurpose vehicles dropped 6% from a year earlier to 1.87 million units, the China Passenger Car Association said. The decline was the 16th in the past 17 months, with the only increase coming this June as dealers offered large discounts to clear inventory.

    The period known as “Golden September, Silver October” is typically strong for carmakers as consumers like to make big-ticket purchases during the harvest season. Not this year though, underscoring the depth of the historic slump the car industry is mired in.

    Demand in the world’s biggest car market has been hurt by a slowing economy that’s made consumers curb spending. Measures by the government to boost consumption have yet to help, leaving automakers’ profitability challenged and prompting industry insiders to predict mergers and market exits.

  • 08:59

    BoE: Dovish message – Deutsche Bank

    Deutsche Bank analysts point out that the BoE kept rates unchanged yesterday but the bigger takeaway was the dovish message. 

    “It started with the 2 dissenters who voted for a cut, indicating that they thought that some monetary stimulus was required to ensure inflation returned to target. The meeting also included three key changes to the BoE outlook according to our economists. The first was as expected, that was the MPC revising down its near term growth and inflation outlook. The second was the MPC revising down its estimate of potential supply and the third the BoE’s condition assumptions on Brexit changing materially. The end result is that our economists continue to see January as a live meeting for a rate cut with the election outcome and upcoming growth and labour market data releases taking on added significance. Indeed, with Saunders and Haskell dissenting, the bar to a cut has been lowered. Sterling weakened through the meeting and closed down -0.30%.”

  • 08:39

    Cracks in UK labour market grow as demand for staff fades - REC

    British employers' demand for staff grew in October at the slowest rate in almost eight years, a survey showed on Friday, underlining suspicions at the Bank of England that the labour market may be losing its strength.

    A monthly index of jobs vacancies from the Recruitment and Employment Confederation and accountants KPMG fell to 51.7 from 52.6 in September, its lowest level since January 2012.

    Friday's REC report - which is monitored by the BoE - showed permanent job placements fell for an eighth month running and at a faster rate than in September, chiming with official data which showed job creation waning ahead of the aborted October Brexit deadline.

    James Stewart, vice chair at KPMG, said uncertainty around Brexit and a national election scheduled for Dec. 12 had dampened companies' hiring plans. "It's not just businesses that are being cautious, however, and over October we've seen job-seekers become increasingly nervous about making a career change," said James Stewart, vice chair at KPMG.

  • 08:20

    G10: A great opportunity for central banks to get rid of negative rates - BofAML

    Bank of America Merrill Lynch Research argues that it's time to get rid of negative policy rates, noticing that central banks with negative rates should not be concerned about currency strength if they bring rates to zero, particularly if they strengthen forward guidance instead.

    "Two key developments have happened this fall that makes us believe that this is a great opportunity for central banks to get rid of negative rates, without being concerned about a strong currency, given the side effects. First, the ECB cut depo rates even deeper into negative territory in September and EUR did not respond. Up to an extent tiering may have offset the impact of the depo rate cut, but if this is the case, then why cut in the first place? Second, the Riksbank  signaled in its October meeting that it wants to bring rates back to zero, despite weak data, because of concerns from negative side effects, at the same time strengthening forward guidance promising to keep rates at zero for longer, and SEK also did not react much: the market has now priced the hike fully. In both cases, the currencies weakened sharply when the central banks introduced negative rates and remain at such low levels. However, it is now clear to us that negative rates (and bringing rates back to zero) do not affect FX anymore, at least not to the same extent as when they were introduced," BofAML adds.

  • 08:00

    France: private payroll employment accelerated slightly in third quarter

    According to the report from Insee, in Q3 2019, private payroll employment increased by 0.3%. It accelerated slightly compared to the previous quarter: +54,300 net jobs after +45,400 jobs. Year on year, private payroll employment rose by 1.4% (that is +263,200 jobs). Excluding temporary employment, its growth was similar: +0.3% over the quarter (that is +57,900 jobs) and +1.5% over the year (that is +273,200 jobs).

    Private payroll employment accelerated slightly in construction: +0.7% in Q3 2019 (that is +9,900 jobs),  after +0.5%. It increased slightly in industry: +0.2% (that is +6,200 jobs), after 0.0%. Year on year, private payroll employment increased by 43,400 in construction and by 23,200 in industry.

    Private employment increased again in market services: +0.3% (that is +36,300 jobs), as in the previous quarter, bringing its rise to 1,5% over a year (that is +182,600). Excluding temporary employment, the increase was comparable: +0.3% as in the previous quarter and +1.7% over a year. Private employment in non-market services is stable over the quarter, but is 0.4% above its level one year ago.

    Temporary employment slowed down again moderately: –0.5% after –0.3% in the previous quarter (that is –3,600 jobs after –2,200). Year on year, it decreased by 1.2% (that is –10,000 jobs).

  • 07:46

    France: Non-Farm Payrolls, Quarter III 0.3%

  • 07:45

    France: Trade Balance, bln, September -5.55 (forecast -4.8)

  • 07:45

    France: Industrial Production, m/m, September 0.3% (forecast 0.3%)

  • 07:30

    US consumer sentiment market movers today – Danske Bank

    Analysts at Danske Bank point out that in the US focus today is on the US Michigan consumer sentiment indicator, which will give us more details about the activity in the US service sector and private consumption growth on the back of the mixed signals we received from the strong ISM non-manufacturing and weak PMI services print, respectively. 

    “The day will also give us details about how hard the Chinese export sector has been hit by the trade war with the US and the global slowdown from the trade balance figures for October. We expect exports to still look soft but not as weak as in the beginning of 2019. Markets will also keep a close eye on any trade headlines. In Sweden, the September consumption indicator is due out, giving us more clues about where Q3 GDP growth is going to print.”

  • 07:16

    Germany's trade surplus rose in September

    According to the report from Federal Statistical Office (Destatis), Germany exported goods to the value of 114.2 billion euros and imported goods to the value of 93.0 billion euros in September 2019. Destatis also reports that German exports increased by 4.6% and imports by 2.3% in September 2019 year on year. After calendar and seasonal adjustment, exports were up 1.5% and imports 1.3% compared with August 2019.

    The foreign trade balance showed a surplus of 21.1 billion euros in September 2019. In September 2018, the surplus amounted to +18.2 billion euros. In calendar and seasonally adjusted terms, the foreign trade balance recorded a surplus of 19.2 billion euros in September 2019.

    According to provisional results of the Deutsche Bundesbank, the current account of the balance of payments showed a surplus of 25.5 billion euros in September 2019, which takes into account the balances of trade in goods including supplementary trade items (+22.9 billion euros), services (-3.2 billion euros), primary income (+9.2 billion euros) and secondary income (-3.4 billion euros). In September 2018, the German current account showed a surplus of 18.9 billion euros.

  • 07:03

    Germany: Trade Balance (non s.a.), bln, September 21.1

  • 07:01

    Germany: Current Account , September 25.5 (forecast 20.4)

  • 06:45

    Switzerland: Unemployment Rate (non s.a.), October 2.2% (forecast 2.2%)

  • 06:43

    Options levels on friday, November 8, 2019

    EUR/USD

    Resistance levels (open interest**, contracts)

    $1.1150 (3098)

    $1.1103 (3702)

    $1.1076 (2864)

    Price at time of writing this review: $1.1050

    Support levels (open interest**, contracts):

    $1.0999 (3899)

    $1.0950 (3351)

    $1.0900 (3793)


    Comments:

    - Overall open interest on the CALL options and PUT options with the expiration date November, 8 is 76931 contracts (according to data from November, 7) with the maximum number of contracts with strike price $1,1000 (3899);


    GBP/USD

    Resistance levels (open interest**, contracts)

    $1.2901 (972)

    $1.2859 (476)

    $1.2840 (1846)

    Price at time of writing this review: $1.2810

    Support levels (open interest**, contracts):

    $1.2749 (596)

    $1.2700 (296)

    $1.2650 (644)


    Comments:

    - Overall open interest on the CALL options with the expiration date November, 8 is 25887 contracts, with the maximum number of contracts with strike price $1,3400 (3252);

    - Overall open interest on the PUT options with the expiration date November, 8 is 30375 contracts, with the maximum number of contracts with strike price $1,2100 (3161);

    - The ratio of PUT/CALL was 1.17 versus 1.18 from the previous trading day according to data from November, 7

     

    * - The Chicago Mercantile Exchange bulletin (CME) is used for the calculation.

    ** - Open interest takes into account the total number of option contracts that are open at the moment.

  • 05:16

    Japan: Coincident Index, September 101 (forecast 99.5)

  • 05:02

    Japan: Leading Economic Index , September 92.2

  • 03:32

    China: Trade Balance, bln, October 30.13 (forecast 40.83)

  • 02:30

    Commodities. Daily history for Thursday, November 7, 2019

    Raw materials Closed Change, %
    Brent 62.57 0.82
    WTI 56.96 1.17
    Silver 17.1 -2.84
    Gold 1468.252 -1.52
    Palladium 1800.57 0.55
  • 00:30

    Stocks. Daily history for Thursday, November 7, 2019

    Index Change, points Closed Change, %
    NIKKEI 225 26.5 23330.32 0.11
    Hang Seng 158.59 27847.23 0.57
    KOSPI 0.14 2144.29 0.01
    ASX 200 66.4 6726.6 1
    FTSE 100 9.76 7406.41 0.13
    DAX 109.57 13289.46 0.83
    Dow Jones 182.24 27674.8 0.66
    S&P 500 8.4 3085.18 0.27
    NASDAQ Composite 23.89 8434.52 0.28
  • 00:30

    Australia: Home Loans , September 1.4% (forecast 1.3%)

  • 00:15

    Currencies. Daily history for Thursday, November 7, 2019

    Pare Closed Change, %
    AUDUSD 0.68974 0.21
    EURJPY 120.751 0.13
    EURUSD 1.10495 -0.15
    GBPJPY 140.029 -0.04
    GBPUSD 1.28135 -0.32
    NZDUSD 0.63671 -0.01
    USDCAD 1.3173 -0.07
    USDCHF 0.99474 0.22
    USDJPY 109.278 0.28
Market Focus

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