Thursdays Market Prepper
- Futures on watch ahead of GDP data
- BlackBerry pops after surprise profit
- Toshiba selling chip unit for $18B
- Toyota, Mazda team on EV development
- U.K. threatens trade war with U.S.
- Schaeuble out as Germany's FM
- Citi is bringing back CDOs
- New measures to fight opioid addiction
- India: GE locomotive factory on track
- Yellen’s inflation patience gives duration bulls more ammo.
- Tudor veteran sees turbulent quarter as inflation hits bonds.
- What Spain’s secession vote means for investors.
- With Schaeuble out, who will be Germany’s next finance minister?
- Does college basketball’s economy breed crooks?
- Legal weed could be a windfall for McDonalds and Taco Bell.
- Playboy founder Hugh Hefner dies at 91.
- What Will End The Bull Market?
- Plan Analysis
Lower at 2500 support
Yesterdays Unusual Option Action:'
President Trump has revealed his "once in a generation" tax reform plan, which calls for lower corporate and personal tax rates, while Democrats attacked the framework, saying it mostly helps the wealthy and will inflate the deficit. One of the proposals was for a one-off low tax rate for firms repatriating overseas profits. That pushed up the greenback as it could lead to a phase of dollar buying.
The economic calendar today will focus on the final GDP revision for the second quarter, which is expected to remain steady at 3%. President Trump has touted that number as a cornerstone of his administration's economic plan. "If we achieve sustained 3% growth that means 12M new jobs and $10T of new economic activity," Trump said last month during a speech in Missouri.
After eight years in the post, Wolfgang Schaeuble is stepping down as Germany's finance minister to become speaker of the Bundestag. The move will open the way for Chancellor Angela Merkel to offer the post to a coalition ally. Many debt-mired countries in southern Europe are also likely to cheer the departure as Schaeuble was the leading voice for austerity throughout the euro crisis.
Theresa May has threatened a trade war with the U.S. after it slapped punitive tariffs on Bombardier's (OTCQX:BDRAF, OTCQX:BDRBF) British-built aircraft. She also warned that Boeing's (NYSE:BA) long-term partnership with the government is being "undermined by this behavior." May has appealed directly to President Trump to intervene in the dispute, which has dented her hopes of signing a post-Brexit free trade deal with the U.S.
Businesses and households across the eurozone are now more upbeat about their prospects than at any time in the past decade, an indication that they are undaunted by the prospect of reduced stimulus from the ECB. The European Commission's Economic Sentiment Indicator, which aggregates business and consumer confidence, rose to 113.0 in September from 111.9 in August, to reach its highest level since June 2007.
Paving the way for a snap election on Oct. 22, Japanese Prime Minister Shinzo Abe dissolved the lower house of parliament overnight. Abe is widely seen as trying to reconsolidate his grip on power within the ruling Liberal-Democratic Party, but he faces a growing challenge from the new Party of Hope, which was launched by Tokyo Gov. Yuriko Koike this week.
Venezuela's President Maduro has called on his nation's military leaders to prepare for war against the U.S., stating "the future of humanity cannot be the world of illegal sanctions, of economic persecution." "We need to have rifles, missiles and well-oiled tanks at the ready," he declared, after President Trump said last month he wouldn't rule out a military option in the country.
Mexico has opened the possibility that talks to revamp NAFTA were so complex that they could run into 2018. That would be beyond an end-of-December deadline designed to avoid the country's presidential election campaign which kicks off in March. The next round of NAFTA talks, which will likely deal with "rules of origin," will take place in Washington on Oct. 11-15.
New York's financial services regulator has issued a subpoena to Equifax (NYSE:EFX) demanding more information about its massive data breach disclosed earlier this month. It seeks details on when the credit-reporting firm learned of the breach and what actions it took after it was discovered. Equifax has lost around $4.5B in market value since it reported the hack on Sept. 7.
CDOs came to infamy a decade ago as a hallmark of the global financial crisis, but Citi (NYSE:C) apparently wants to once again become a dominant player in the $70B market. According to Bloomberg, the bank has been spending two years hawking synthetic CDOs - and promoting returns as high as 20% - but feels things are safer this time around because "every part of the deal is distributed to investors."
An effort to allow investors to trade digital currencies as easily as U.S. stocks has taken a step backward. Intercontinental Exchange's (NYSE:ICE) NYSE Arca has withdrawn an SEC request to list Grayscale Investments' Bitcoin Investment Trust (OTCQX:GBTC). The shares currently trade "over the counter" in less formal exchanges, but are nonetheless trading up 508% YTD.
India's new railways minister, Piyush Goyal, said General Electric's (NYSE:GE) plan to build a local diesel locomotive factory is still on track, seeking to allay concerns that the state-controlled network was making changes to the deal. GE warned India's government on Wednesday that it risked losing jobs and having to pay "substantial" penalties if it followed through on a threat to cancel the $2.6B contract.
Disgraced former South Korean president Park Geun-hye has been named as a witness by an appeal court reviewing the conviction of Jay Y. Lee, the billionaire heir to the Samsung Group. He was sentenced to a five-year jail term after being found guilty last month of bribing Park to help him strengthen control over Samsung Electronics (OTC:SSNLF), the conglomerate's crown jewel.
Roku has priced its IPO at $14 per share, at the high end of its $12-$14 range, and will begin trading today on the Nasdaq under stock ticker "ROKU." With 15.7M shares on offer, the raise is about $220M and values the company at $1.3B. Roku is best known for its video streaming devices that let users access Netflix (NASDAQ:NFLX), Amazon (NASDAQ:AMZN), YouTube (GOOG, GOOGL) and dozens of online channels.
Amazon has slashed the price of its latest Echo speaker. The smaller, cheaper version will cost $99, a significant drop from the current model's $180 price. At yesterday's hardware event, Amazon's (AMZN) Dave Limp said the company had a team of over 5,000 people working on Echo and the Alexa ecosystem - that's more people than consumer device makers Fitbit (NYSE:FIT) and GoPro (NASDAQ:GPRO) have combined.
President Trump's commission on drug addiction has unveiled new measures to stop the opioid epidemic: strategic partnerships and new drug supply limits. It follows a gathering at the White House which included presentations from various invited government officials, businesses and nonprofit organizations. Related tickers: JNJ, ENDP, TEVA, ABC, MCK, INSY, DEPO, AGN, ALKS, MNK, AMPH, PFE, BDSI, DRRX, CARA, COLL, EGLT, PTIE, ACUR, PTX, ACRX, IPCI, KMPH, TRVN, CXW, BDSI
A bipartisan deal among key senators has been reportedly reached on self-driving car legislation, with the text planned to be released today. According to Reuters, the bill is not expected to include larger commercial trucks, which some Democrats and labor leaders had opposed including, but many Republicans wanted. General Motors (NYSE:GM), Alphabet (GOOG, GOOGL), Ford (NYSE:F) and others have lobbied for the legislation.
Fiat Chrysler is set to engage in settlement talks with representatives of vehicle owners suing the carmaker over excess diesel emissions. The negotiations will take place in Washington in mid-October. It comes after the Justice Department sued Fiat (NYSE:FCAU) in May for using software that led to excess emissions in more than 100K diesel vehicles.
Seeking to catch up with rivals, Toyota (NYSE:TM) is establishing a new venture to develop electric vehicle technology with partner Mazda (OTCPK:MZDAY) and parts maker Denso (OTCPK:DNZOY). Global automakers are accelerating their efforts to develop battery-powered cars as policymakers in key markets like China demand a shift to these product lines over the next two to three decades.
Lyft is close to hiring an IPO advisory firm, sources told Reuters, as it prepares to access capital beyond its traditional route of private investments. The plans come as LYFT's larger competitor, UBER, attempts to recover from a range of scandals. In August, new CEO Dara Khosrowshahi set a new tentative timeline for Uber's IPO of between 18 and 36 months.
In Asia, Japan +0.5%. Hong Kong -0.8%. China -0.2%. India +0.4%.
In Europe, at midday, London -0.2%. Paris +0.1%. Frankfurt +0.3%.
Futures at 6:20, Dow flat. S&P flat. Nasdaq flat. Crude +1.1% to $52.72. Gold -0.1% to $1287.10.
Ten-year Treasury Yield +3 bps to 2.34%
Today's Economic Calendar
8:30 GDP Q2
8:30 International trade in goods
8:30 Initial Jobless Claims
8:30 Corporate profits
9:45 Fed's George: Monetary Policy and Economic Outlook
9:45 Bloomberg Consumer Comfort Index
10:30 EIA Natural Gas Inventory
11:00 Kansas City Fed Mfg Survey
1:00 PM Results of $28B, 7-Year Note Auction
3:00 PM Farm Prices
4:30 PM Money Supply
4:30 PM Fed Balance Sheet