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Daily Markets Update, 1 November

 

 

 

 

  • Stocks climb Higher to Start November
  • Optimism on Economy (for some): OIL,Stock and Dollar all UP
  • Bank of England Sets Stage for Rate Increase
  • Oil Price Outlook Gets Bullish
  • Venezuela on the brink of Default.

 

 

U.S. and Global stocks climbed to start November after major indexes posted several records last month.

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The European STOXX 600 index climbing to its highest level since August 2015 as stock markets in London, Paris and Frankfurt gained 0.5 to 1.2 percent in early trade.

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The Stoxx 600’s relative strength index has now climbed above 70, a level that indicates overbought conditions, for the first time in more than 2 weeks, and is heading for its highest level since Aug. 2015, led by cyclical sectors including miners, automakers and technology.

Gains in technology shares boosted major Asian bourses. Japan’s Nikkei Stock Average closed up 1.9% in its biggest daily point gain since May, while Hong Kong’s Hang Seng Index rose 1.2%.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.9%, led by a 1.3% jump in South Korea. South Korea’s economic growth accelerated to its fastest pace in seven years last quarter. Growth in Taiwan during the same period was the strongest in 2 1/2 years.

Japan, where the stock meltup was most pronounced with the Nikkei rising nearly 2%, and the Topix index rising to the highest in more than a decade, buoyed by a weaker yen.

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Electronics makers gave the biggest boost to the Topix as Sony jumped 11% to the highest level since June 2008 after lifting its annual operating profit outlook to a record, after the company announced record annual profit in 2017 owing to strong sales of semiconductors and favorable exchange rates.

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In the UK Some of Europe’s biggest fund managers are set for a face-off on how best to trade the U.K.’s first potential interest-rate increase in a decade.

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Today’s news highlights the dilemma facing the Bank of England’s policymakers, as they try to decide whether to raise interest rates tomorrow, as one of Britain’s biggest retailers reporting weak, volatile sales and  Britain’s factories growing steadily, with production rising

 

Over at the House of Lords, Sam Woods, deputy governor of the Bank of England, has told peers that 10,000 City jobs could be lost on “day one” after Brexit.

Woods, who runs the regulatory arm of the Bank, has already asked 400 banks and financial firms for their contingency plans in the event of a hard Brexit.

 

 

This week :

  • The U.S. October payroll report comes out Friday.
  • Trump starts an 11-day trip to Asia, his first as president, on Friday. Trade and security issues — particularly North Korea — will probably be in focus.
  • A probable Bank of England rate hike on Thursday will be the first in a decade.
  • The slew of earnings releases will culminate with Apple Inc. results.

 

Stocks News

Bitcoin has smashed through the $6,500 barrier to hit a new record level after the CME announced plans to launch bitcoin futures later this year. Prices hit a high of $6,550.14, according to CoinDesk, resulting in a bitcoin market capitalization of $109B. The introduction of such a product could bring more institutional investors into the market, boosting bets the cryptocurrency could enter the financial mainstream.

Wal-Mart plans to hold more than 20,000 parties at its stores over the next two months, with the first event, called “Toys That Rock,” taking place nationwide this Saturday. It’s part of the retailer’s marketing strategy for the holiday season. Wal-Mart (NYSE:WMT) also plans to triple its online selection to 60M items, and will provide free two-day shipping when an order size exceeds $35.

HP has completed its purchase of Samsung Electronics’ (OTC:SSNLF) printer business in a deal valued at $1.05B, while the latter will make a $100M-$300M equity investment in the U.S. company through open market purchases. HP (NYSE:HPQ) will now have access to more than 6,500 print patents from Samsung and a workforce of nearly 1,300 researchers and engineers that are experts in laser technology and imaging electronics.

Marking its first foray into AI chips, Microsoft (NASDAQ:MSFT) is working on a prototype for its next-generation HoloLens headset, allowing it to do things like recognize objects in its line of sight. The U.S. technology giant could also take it to other products in its hardware range, said Panos Panay, corporate vice president of devices at Microsoft.

How did the cable news wars finish October? Back in his original 9 p.m. slot, Fox News Channel’s (FOX, FOXA) Sean Hannity hosted the most-watched program of the month, delivering 3.2M total viewers and 686K in the 25-54 news demographic. October’s stats for MSNBC’s (NASDAQ:CMCSA) Rachel Maddow – 2.5M viewers and 558K news demo viewers – put her in third place, also behind Fox’s 8 p.m. Tucker Carlson Tonight (2.82M viewers, 581K news demo viewers).

Orbital ATK’s newly redesigned Taurus XL rocket, now renamed the Minotaur-C, has returned to flight with a commercial mission deploying ten satellites for Planet Labs. Liftoff took place from Vandenberg Air Force Base in California. Orbital’s (NYSE:OA) rocket last flew in March 2011, when it suffered the second of two consecutive and near-identical launch failures.

The U.S. International Trade Commission has recommended the Trump administration impose an import tariff of up to 35% on solar panels to protect U.S. manufacturers. “That’s below the price that people have been hoarding panels for,” said Cowen analyst Jeffrey Osborne. “On the demand side, job cuts won’t be as bad as feared, but on the manufacturing side, job creation won’t be as big. This would have a limited effect.”

Modernizing and maintaining the U.S. nuclear arsenal over the next 30 years will cost more than $1.2T, according to a report from the Congressional Budget Office. President Trump in January directed Secretary of Defense James Mattis to conduct his own review of the U.S. nuclear forces. The results could be published in the coming months. Related tickers: BWHON, ACM, JEC, SAIC, OA, COL, LMT, BA, NOC, GD, AJRD, HII

 

Tuesday’s Key Earnings
3D Systems (NYSE:DDD-15.1% AH after an unexepected loss.
Electronic Arts (NASDAQ:EA-2.9% AH on light holiday guidance.
MasterCard (NYSE:MA-0.1% warning on European fines.
Pfizer (NYSE:PFE-0.2% challenged by legacy medicines.
U.S. Steel (NYSE:X+7.5% AH following a strong Q3.
Under Armour (NYSE:UAA-23.7% slashing its full-year outlook.

 

Today’s Markets 
In Asia, Japan +1.9%. Hong Kong +1.2%. China +0.1%. India +1.2%.
In Europe, at midday, London +0.2%. Paris +0.5%. Frankfurt +1.6%.
Futures at 6:20, Dow +0.6%. S&P +0.4%. Nasdaq +0.5%. Crude +1.2% to $55.03. Gold +0.7% to $1279.60.
Ten-year Treasury Yield +1 bps to 2.39%

 

Currencies

  • The Bloomberg Dollar Spot Index advanced 0.1 percent.
  • The euro fell 0.3 percent to $1.1615.
  • The British pound increased less than 0.05 percent to $1.3288, the strongest in more than a month.
  • The Japanese yen decreased 0.5 percent to 114.20 per dollar, the weakest in about six months.

Bonds

  • The yield on 10-year Treasuries increased one basis point to 2.39 percent.
  • Germany’s 10-year yield advanced two basis points to 0.38 percent.
  • Britain’s 10-year yield climbed four basis points to 1.372 percent.
  • Japan’s 10-year yield declined one basis point to 0.061 percent, the lowest in more than three weeks.

Commodities

  • West Texas Intermediate crude advanced 1 percent to $54.93 a barrel, the highest in eight months.
  • Gold increased 0.3 percent to $1,274.80 an ounce.
  • Copper advanced 1.6 percent to $3.15 a pound.
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