Friday Morning Reads
- Financial Crisis Could Emerge From Pandemic
- Wall Street Bank Trading Boom
- Transform How the Wealthy Invest Their Money
- Ineffective In Treating Covid-19, WHO Study Finds
- Here’s Why Canned Corn Might Be Tough to Find
- Budget-Store Billionaire
- Shares of Gun Makers Gain
- Hiding $2 billion From IRS
- This Time Was Different
British Prime Minister Boris Johnson is due to make a final call on whether to accept a narrow post-Brexit trade deal with the EU or go for a no-deal scenario, after being dished an ultimatum at the EU Summit in Brussels. Britain's chief negotiator, David Frost, said he was "disappointed and surprised" that the EU was no longer committed to working "intensively" for a deal, but a response will come later today. The decision is set to affect $900B in annual trade, as well as supply chains that stretch across Europe and beyond, against the backdrop of a pandemic that has upended the economy.
China's top legislative body, the National People's Congress, is set to adopt a new rule that would restrict sensitive exports vital to national security in a session that concludes on Saturday. The Export Control Law would apply to all companies in China, including foreign-invested ones, and would add to Beijing's regulatory arsenal, which already includes a tech export restriction catalog and an unreliable entity list. Competition has been growing with the U.S. over access to technology, and big Chinese companies including Huawei, ByteDance's (BDNCE) TikTok, Tencent's (OTCPK:TCEHY) WeChat and Semiconductor Manufacturing International Corp. (OTC:SMI) have already found themselves in Washington's crosshairs in recent months.
U.S. stock index futures are holding steady as investors pull back from the big technology stocks that have helped drive the market this year. On-again, off-again stimulus talks, as well as risks of a second wave of coronavirus infections, have put a lot of money on the sidelines, while traders also appear "reluctant to make any big bets until after the election, when the risk of contested results has been eliminated," said Jim McCormick, global head of desk strategy at Natwest Markets. The big news on the economic calendar today is retail sales data, which will offer an update on the recovery in consumer spending, after jobless claims rose last week to the highest level since late August.
Go Deeper: FCC Chairman Ajit Pai to clarify Section 230 of the Communications Act.
Remdesivir has "no substantial effect" on the survival of hospitalized patients, according to a not-yet-published study by the World Health Organization that was seen by the FT. Shares of maker Gilead Sciences (NASDAQ:GILD) slipped 1.7% on the news yesterday, and are down another 1.2% premarket. In response, Gilead said it's unclear if any conclusive findings can be drawn, though a similar lack of impact was found in regimes of hydroxychloroquine, lopinavir and interferon.
The U.S. has reportedly made an offer to the EU to remove a host of tariffs if Airbus (OTCPK:EADSY) repaid European governments with billions of dollars in aid, but retaliation is also in the cards after the most recent WTO ruling. "If they strike back, then we'll strike much harder," President Trump told reporters. "They don't want to do anything, I can tell you that." Earlier this week, the bloc won permission to level up to $4B in tariffs on American goods in response to subsidies for Boeing (BA), though the EU will likely hold fire until after next month's U.S. election, according to Bloomberg.
Changes made to Boeing's (NYSE:BA) 737 MAX have made the plane safe enough to return to the region's skies, according to Europe's top aviation regulator, marking a vote of confidence for a plane that has been grounded since March 2019. EASA is now performing final document reviews ahead of a draft airworthiness directive it expects to issue in November, which will be followed by four weeks of public comment. The FAA is also preparing to clear the plane's return, but EASA's view carries outsized weight given the flaws in the plane's original certification process that dented the U.S. regulator's reputation.
The company that makes Apple's (NASDAQ:AAPL) iPhone may soon be assembling electric cars. Foxconn (OTC:FXCOF) has introduced what it called the "MIH Open Platform," which is essentially a set of tools that would allow a company to design large parts of an electric car (chassis sizes, battery capacities, suspension types etc.) via modular manufacturing. The latest announcement pushes the company into a market which could be worth over $800B by 2027, according to Allied Market Research, as it looks to diversify its business.
General Motors' (NYSE:GM) Cruise autonomous vehicle unit is pulling the human backup drivers from its vehicles in San Francisco after landing a permit from the California Department of Motor Vehicles. "We're not the first company to receive this permit, but we're going to be the first to put it to use on the streets of a major U.S. city," said Cruise CEO Dan Ammann. The move follows last week’s announcement from Google's (GOOG, GOOGL) Waymo that it would open its self-driving ride-hailing service to the public in the Phoenix area in vehicles without human drivers.
What else is happening...
Thursday's Key Earnings
Aphria (NASDAQ:APHA) -18.4% disappointing with FQ1 distribution revenue.
Charles Schwab (NYSE:SCHW) +5.2% topping expectations.
Morgan Stanley (NYSE:MS) +1.3% posting strong wealth management figures.
Taiwan Semiconductor (NYSE:TSM) -0.5% beating top and bottom line estimates.
Walgreens (NASDAQ:WBA) +4.8% forecasting profit growth for 2021.
In Asia, Japan -0.4%. Hong Kong +0.9%. China +0.1%. India +0.6%.
In Europe, at midday, London +0.6%. Paris +0.9%. Frankfurt +0.3%.
Futures at 6:20, Dow -0.1%. S&P -0.1%. Nasdaq +0.1%. Crude -0.4% to $40.79. Gold +0.2% at $1912.60. Bitcoin +0.5% to $11273.
Ten-year Treasury Yield -1 bps to 0.72%
Today's Economic Calendar
8:30 Retail Sales
9:15 Industrial Production
10:00 Business Inventories
10:00 Consumer Sentiment
1:00 PM Baker-Hughes Rig Count
1:35 PM Fed's Bullard: "Monetary Policy in Transition"
2:00 PM Treasury Budget
4:00 PM Treasury International Capital