Friday Morning Reads

Friday Morning Reads



Open Interest:




Restarting relief negotiations

"The president and I want more support," Treasury Secretary Steven Mnuchin told the Senate Banking Committee. "I've probably spoken to Speaker Pelosi 15 or 20 times in the last few days on coronavirus relief, and we've agreed to continue to have discussions about the CARES Act." "We will be hopefully soon to the table with them, very soon, showing you where our money wouldn't be spent," Pelosi added. House Democrats are now preparing a new, smaller coronavirus relief package expected to cost about $2.4T (down from $3.5T), according to Politico, which would include enhanced unemployment insurance, direct payments to Americans, Paycheck Protection Program small business loan funding and aid to airlines and restaurants.

Last session of rollercoaster week

Closing higher yesterday after a wobbly session, U.S. equity futures dropped nearly 1% overnight, with the S&P 500 on course for a fourth consecutive week of losses. The economic calendar is light today with only durable goods due to be published at 8:30 a.m. ET, on the back of weak jobless claims data seen Thursday. Most of the market focus appears to be on breakthroughs in stimulus talks after Treasury Secretary Steven Mnuchin and House Speaker Nancy Pelosi confirmed discussions. COVID-19 cases are meanwhile growing across the U.S., with infections rising in 22 states over the past week. The U.S. is now averaging roughly 43,000 new cases per day, a 16% increase from a week ago (testing is up by almost 22% over the same period).

DOJ asks judge to allow WeChat ban to proceed

The U.S. Justice Department has asked U.S. Magistrate Judge Laurel Beeler to stay an injunction blocking a ban on Tencent's (OTCPK:TCEHY) WeChat, arguing the Chinese-owned messaging app jeopardizes national security. "The WeChat mobile application collects and transmits sensitive personal information on U.S. persons, which is accessible to Tencent and stored in data centers in China and Canada," the DOJ wrote in the filing. On Wednesday, TikTok (BDNCE) sought a similar preliminary injunction from a U.S. judge in Washington. He gave the government until at 2:30 p.m. today to respond to the request or delay the U.S. app store ban on new TikTok downloads (set to take effect Sunday).

Tax fight is not over yet

The European Commission is taking its case against Apple (NASDAQ:AAPL) to the highest court in Europe, appealing an EU general court decision from July that ruled in favor of Ireland and the tech giant. Seeking to crack down on "sweetheart tax deals," the Commission sparked the case by ordering Apple to pay $14.4B in back taxes (that have been held in escrow while appeals process plays out). The EC now intends to argue that the court set the bar for requisite standards "unreasonably high," a precedent that will be specifically watched given the EU's drive to create new tax laws governing major technology companies.

More vaccine talk

Dr. Anthony Fauci took to Facebook Live on Thursday to assuage increasing concerns about a politicized approval process for a potential coronavirus vaccine. "People are always saying, 'How do I know it’s safe? How do I know it's effective? There's a lot of confusion because there are mixed messages that are coming," he declared. With every vaccine trial, there is an independent group of scientists, vaccinologists, ethicists and statisticians - known as a data and safety monitoring board - that has exclusive access to the data from a vaccine's clinical trial. If a vaccine proves safe and effective, the company can then seek approval from the FDA and the data will eventually become publicly available.

New York will conduct separate review

"The people of this country don't trust this federal government with this vaccine process," New York Gov. Andrew Cuomo later said in a press briefing, saying his state would set up its own independent task force to approve a COVID-19 vaccine. President Trump related earlier that the White House may overrule stricter FDA guidelines for emergency-use authorization of a vaccine, while HHS Secretary Alex Azar revealed all six frontrunning vaccines were being produced at an industrial scale. Over in Europe, AstraZeneca (NYSE:AZN) received partial immunity in a low-cost EU vaccine deal, while in return for a higher price paid for its vaccine, Sanofi (NASDAQ:SNY) - which is working with GlaxoSmithKline (NYSE:GSK) - did not get any liability waivers.
Go Deeper: Novavax soars after starting Phase 3 trials in the U.K.

End to cigarettes

"With the right regulatory encouragement and support from civil society, we believe cigarette sales can end within 10 to 15 years in many countries," declared Philip Morris (NYSE:PM) CEO André Calantzopoulos, speaking at the Concordia Annual Summit. "Yes, that’s right," he added. "An end to cigarettes within 10 to 15 years in many countries." Calling cigarettes "the most harmful way of consuming nicotine," Calantzopoulos would prefer focus on products "that do not involve combustion." Over 11.2M people, he said, have switched to his company's IQOS and stopped smoking.

Amazon hardware event

Amazon (NASDAQ:AMZN) showed off a host of new devices at its online hardware event on Thursday, including spherical Alexa speakers and two new Fire TV products. Plans to jump into the increasingly crowded game streaming space were also unveiled. The platform, called Luna, works on Fire TV, Mac, mobile devices, and PCs. In drone news, Amazon's Ring showed off an autonomous indoor security camera (called Always Home Cam) that can fly around a house and automatically respond to security alarms.

What else is happening...

Amid surging food delivery demand, Deliveroo eyes IPO for 2021.

Airbus (OTCPK:EADSY) holds production stable in face of crisis warnings - Reuters.

CEOs of Google (GOOGGOOGL), Facebook (NASDAQ:FB), Twitter (NYSE:TWTR) subpoenaed over Section 230.

Amazon (AMZN) hires former Yahoo, Slack privacy head for Alexa effort - BI.

Banks file record number of suspected business loan fraud reports in August.

Thursday's Key Earnings

BlackBerry (NYSE:BB) -1% despite higher software, licensing demand.
Costco (NASDAQ:COST) -2.9% AH even with comp sales rising 14.1% .
Rite Aid (NYSE:RAD) -17.8% giving back guidance-driven gains.

Today's Markets

In Asia, Japan +0.5%. Hong Kong -0.3%. China -0.1%. India +2.3%.
In Europe, at midday, London -0.7%. Paris -1.9%. Frankfurt -2%.
Futures at 6:20, Dow -1%. S&P -0.9%. Nasdaq -0.6%. Crude -0.7% to $40.04. Gold -0.7% to $1863.40. Bitcoin +1.8% to $10598.
Ten-year Treasury Yield flat at 0.66%

Today's Economic Calendar

8:30 Durable Goods
9:00 Fed's Williams Speech
1:00 PM Baker-Hughes Rig Count
3:10 PM Fed's Williams: "Young Adult Perspectives on COVID-19 Job Market"

Known to most as Uranium Pinto Beans, Jason has more than 15 years under his belt of trading stocks, options and currencies. His expertise primarily lies in chart analysis, and he has a strong eye for undervalued stock. Because he’s got the ability to identify great risk/reward trades he usually enjoys taking the path less traveled and reaping the benefits from the adventure.

He is a co-founder of Option Millionaires, and he is best known for his weekly webinars with Scott, as well as his high level training webinars and charts found in the forums.

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