Thursday's Market Prepper
- Puppet Show for Markets
- Real Quick
- ECB Tapering
- Yellen Credibility Dented
- Tesla Muzzling Model 3 Buyers
- Bull & Bear Market Volatility Look Very Different
- One Bitcoin a Month!
- Extremist Bond Calls
- Twitter adds users; profitability possible
- Ford rallies after operating margin shines
- Report: Spain tension defused
- Future path of ECB stimulus
- Partnerships ahead for GE Digital
- European earnings roundup
- Pfizer readying consumer health sale
Yesterdays Unusual Option Action:
It's the most hotly anticipated ECB meeting of the year. With no change in interest rates expected, all focus will be on the central bank's massive asset purchase program, which has underpinned the eurozone economy and financial markets since its launch in early 2015. Expectations are mounting that the ECB will announce an extension to its QE, most likely until September 2018, while at the same time declare a tapering of the size of its monthly purchases starting next year.
Catalonia's lawmakers will meet in Barcelona today for a session many fear will lead to a unilateral declaration of independence and the proclamation of the region as a new republic. "The government is not giving us any option other than defending the civil liberties of citizens through the best institutional instruments," Catalan Vice President Oriol Junqueres told Spanish television.
U.S. District Judge Vince Chhabria has refused to block President Trump's decision to end subsidy payments to health insurers under Obamacare, handing him a victory against Democratic state attorneys general. According to the judge, this kind of emergency order was not necessary, because "most state regulators have devised responses that give millions of lower-income people better health coverage options than they would otherwise have had."
A budget plan for large-scale tax cuts looked set for a close vote this morning in the U.S. House of Representatives after some Republicans vowed opposition in an effort to protect a popular tax break. The faction is resisting a proposal to eliminate a federal deduction for state and local taxes, also known as "SALT," which would hit middle-class voters in high-tax states like New York, New Jersey and California.
Back to the Fed chair reality show... President Trump has reportedly told people at least twice in the last week that he will not appoint National Economic Council Director Gary Cohn, according to Bloomberg. "Gary's role is too crucial to getting tax reform done," said senior administration officials, who related that Cohn will likely leave the administration following the legislative push.
European earnings roundup: Nokia (NYSE:NOK) -15.5% premarket after posting weak network profits and seeing a market decline in 2018. Statoil's (NYSE:STO) earnings lagged behind forecasts due to impairment charges and lower output in North America. AB InBev (NYSE:BUD) raised its SABMiller merger savings target, while profits increased in Brazil. Barclays (NYSE:BCS) -7% premarket following a big hit to trading revenues. Trading also slumped at Deutsche Bank (NYSE:DB), falling some 30% in Q3, causing shares to slip 1.6% premarket.
General Electric will use more alliances to build its digital-industrial business in coming years, according to John Flannery, marking his first direct remarks about digital strategy since he became CEO on Aug. 1. That could further suggest GE will curb spending in that area. The industrial conglomerate is investing about $2.1B in GE Digital this year, and executives had said that amount would fall in 2018.
Pfizer plans to kick off an auction process for its consumer healthcare business in November, paving the way for a potential $15B-plus sale, Reuters reports. Several global companies, including GlaxoSmithKline (NYSE:GSK) and Reckitt Benckiser (OTCPK:RBGLY), have expressed interest in the Pfizer (NYSE:PFE) unit. Other possible bidders could include Procter & Gamble (NYSE:PG), Sanofi (NYSE:SNY), Johnson & Johnson (NYSE:JNJ) and Nestle (OTCPK:NSRGY).
Influential proxy adviser ISS has weighed in on the proxy fight at Automatic Data Processing (NASDAQ:ADP), recommending that dissident Pershing Square's Bill Ackman be elected to the board. In part, it's joining fellow adviser Glass Lewis, who on Monday recommended all three candidates on Pershing Square's slate. ADP shares inched up on the news in AH trading on Wednesday.
The FCC is planning to make sweeping changes to media-ownership rules next month, eliminating or scaling back longstanding limits on local ownership of TV stations and newspapers. Chairman Ajit Pai's approach has weighed on observers of Sinclair Broadcast Group's (NASDAQ:SBGI) $3.9B bid for Tribune Media (NYSE:TRCO), which would create a local-broadcasting juggernaut bumping hard against mass ownership rules.
Saudi Arabia's stock exchange hopes to be the "exclusive" venue for the listing of Saudi Aramco's (Private:ARMCO) initial public offering, Tadawul CEO Khalid al-Hussan told the FT. The statement raises questions about the structure of the IPO - which New York and London have been vying to host internationally - in what has been billed as the biggest IPO in history.
Following a similar decision at rival Fedex (NYSE:FDX) last month, UPS will raise rates across many of its U.S. services by 4.9% later this year. The rise of e-commerce and online retailers has posed challenges for the shipping industry as costs associated with delivery to residential addresses are higher than to businesses, which receive more packages and bring more revenue per stop.
Amazon has plans to drop off packages directly into shoppers' homes through Amazon Key, a lock and camera system that users control remotely to let delivery associates slip goods into their houses. Prime members can pay $249.99 and up for a cloud-controlled camera and lock the company offers to install. "This is not an experiment for us," said Amazon's (NASDAQ:AMZN) Peter Larsen. "This is a core part of the Amazon shopping experience from this point forward."
In Asia, Japan +0.2%. Hong Kong -0.4%. China +0.3%. India flat.
In Europe, at midday, London +0.3%. Paris +0.2%. Frankfurt +0.2%.
Futures at 6:20, Dow flat. S&P -0.1%. Nasdaq -0.1%. Crude steady at $52.19. Gold flat at $1279.
Ten-year Treasury Yield -1 bps to 2.42%
Today's Economic Calendar
8:30 Initial Jobless Claims
8:30 International trade in goods
9:45 Bloomberg Consumer Comfort Index
10:00 Pending Home Sales
10:30 EIA Natural Gas Inventory
11:00 Kansas City Fed Mfg Survey
1:00 PM Results of $28B, 7-Year Note Auction
4:30 PM Money Supply
4:30 PM Fed Balance Sheet