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28.10.2019
23:30
Japan: Tokyo CPI ex Fresh Food, y/y, October 0.5% (forecast 0.7%)
22:30
Schedule for today, Tuesday, October 29, 2019
Time Country Event Period Previous value Forecast
06:45 Australia RBA's Governor Philip Lowe Speaks    
07:00 United Kingdom Nationwide house price index, y/y October 0.2% 0.2%
07:00 United Kingdom Nationwide house price index October -0.2% 0%
07:45 France Consumer confidence October 104 104
09:30 United Kingdom Net Lending to Individuals, bln September 4.8  
09:30 United Kingdom Consumer credit, mln September 0.901 0.9
09:30 United Kingdom Mortgage Approvals September 65.55 65
09:50 Germany German Buba President Weidmann Speaks    
13:00 U.S. S&P/Case-Shiller Home Price Indices, y/y August 2% 2.1%
14:00 U.S. Pending Home Sales (MoM) September 1.6% 1.7%
14:00 U.S. Consumer confidence October 125.1 127.4
23:50 Japan Retail sales, y/y September 1.8% 6.9%
20:20
Major US stock indices closed in positive territory

The main US stock indexes rose moderately, as the possibility of concluding a trade transaction between the US and China and the strong reporting of the corporate segment strengthened investor optimism.

US President Donald Trump said on Monday that he expects to sign a “very large part” of the trade deal with China earlier than expected, but has not specified a time frame. It was previously planned that the so-called “Phase 1” agreement with China would be signed at a summit in Chile on November 16-17. This strengthened the optimism of market participants, triggered on Friday by Washington's statements that they were “close to completion” of a number of provisions in the trade agreement with Beijing. Xinhua China State News Agency also announced progress in the text of the "first phase" of the trade agreement. Recent news has brought relief to investors who are worried about the negative impact of the trade war on the global economy.

Meanwhile, AT&T and WBA statements supported the corporate segment's trend to show exceeded earnings for the third quarter. According to FactSet, of the 202 companies in the S&P 500 index that have already released their last quarter results, 78% showed higher than expected earnings.

Additional support to the market was provided by increased expectations of an increase in interest rates at the October meeting later this week. Disappointing economic data released earlier this month increased the likelihood that the Fed would lower its base interest rate by 0.25 percentage points. up to 95.1% from 49.2% last month (according to the CME FedWatch Tool). The Fed will announce its decision on Wednesday.

Most DOW components completed trading in positive territory (21 out of 30). The biggest gainers were Microsoft Corp. (MSFT; + 2.41%). Outsiders were shares of McDonald's Corporation (MCD; -1.60%).

Almost all S&P sectors recorded an increase. Only the utilities sector decreased (-1.1%). The technological sector has grown the most (+ 1.2%).

At the time of closing:

Dow 27,090.72 +132.66 +0.49%

S&P 500 3,039.42 +16.87 +0.56%

Nasdaq 100 8,325.99 +82.87 +1.01%

19:50
Schedule for tomorrow, Tuesday, October 29, 2019
Time Country Event Period Previous value Forecast
06:45 Australia RBA's Governor Philip Lowe Speaks    
07:00 United Kingdom Nationwide house price index, y/y October 0.2% 0.2%
07:00 United Kingdom Nationwide house price index October -0.2% 0%
07:45 France Consumer confidence October 104 104
09:30 United Kingdom Net Lending to Individuals, bln September 4.8  
09:30 United Kingdom Consumer credit, mln September 0.901 0.9
09:30 United Kingdom Mortgage Approvals September 65.55 65
09:50 Germany German Buba President Weidmann Speaks    
13:00 U.S. S&P/Case-Shiller Home Price Indices, y/y August 2% 2.1%
14:00 U.S. Pending Home Sales (MoM) September 1.6% 1.7%
14:00 U.S. Consumer confidence October 125.1 127.4
23:50 Japan Retail sales, y/y September 1.8% 6.9%
19:00
DJIA +0.53% 27,100.42 +142.36 Nasdaq +1.05% 8,329.74 +86.62 S&P +0.61% 3,041.06 +18.51
17:00
European stocks closed: FTSE 100 7,331.28 +6.81 +0.09% DAX 12,941.71 +47.20 +0.37% CAC 40 5,730.57 +8.42 +0.15%
16:20
USD/CAD stays flat

After climbing higher toward the 1.31 handle during the European trading hours, the USD/CAD came under modest bearish pressure as the CAD capitalized on rising crude oil prices and gathered strength against its rivals. 

U.S. President Donald Trump on Monday said that they were "ahead of schedule" with finalizing the phase-one of the trade deal with China and added that he was expecting to sign the deal at the APEC meeting in Chile in November to ease worries over a dismal demand outlook. The barrel of West Texas Intermediate rose to a fresh monthly high of $56.90 on these comments but erased its gains to return to the $56 area.

USD waits for FOMC

On the other hand, today's data from the United States revealed that the trade deficit narrowed to $70.4 billion in September from $73.06 billion in August. Other data showed that the Chicago Fed's National Activity Index slumped to -0.45 from 0.15 and the Dallas Fed Manufacturing Index dropped to -5.1 to miss the market expectation of 1.4.

The Greenback largely ignored the data and the US Dollar Index extended its sideways grind near the 97.70/80-area as investors seem to be refraining from making large bets ahead of Wednesday's critical Federal Open Market Committee (FOMC) meeting. 

Previewing the event, “Given the lack of pushback against that pricing by the recent parade of Fedspeak, it’s a relative safe prediction that they deliver another cut to take the fed funds target range to 1.50-1.75%,” said Deutsche Bank analysts.

15:37
Quarter-point rate cut by Fed is fully priced by markets – Deutsche Bank

Analysts at Deutsche Bank suggest that, ahead of this Wednesday’s Fed meeting, a 25-bps rate cut is just about fully priced now.

  • “Given the lack of pushback against that pricing by the recent parade of Fedspeak, it’s a relative safe prediction that they deliver another cut to take the fed funds target range to 1.50-1.75%.
  • Looking forward though, the focus will be around the tone in the policy statement and in Chair Powell’s press conference. The statement could have some dovish-leaning edits, consistent with the deterioration in data since the September policy meeting. As for Powell, he’ll likely want to maintain his optionality moving forward, committing to neither another cut nor a halt to the cutting cycle.
  • Our economists think that he will emphasiяe that another cut would require further deterioration in the data, which they expect will materialяe over the next few months, as opposed to a flatlining in conditions.”

15:16
ECB's outgoing president Draghi: A more active fiscal policy in the eurozone would make it possible to adjust our policies more quickly

  • Leaving the ECB is easier knowing Presidency in capable hands
  • Public trust in the euro is at its highest ever
  • The euro is irreversible
  • Monetary policy can still achieve its objective but it can do so faster and with fewer side effects if fiscal policies are aligned


15:03
Germany: Turbulent political weekend – Deutsche Bank

Analysts at Deutsche Bank note that political fragmentation in Germany continued over the weekend.

  • “The far-left and far-right now command over more than half of the seats in the German state parliament of Thuringia while prolonged leadership battles among the social democrats cast a shadow over the government coalition in Berlin.
  • In yesterday's state elections in Thuringia, the Left of PM Bodo Ramelow came out as the strongest party, followed by the far-right AfD. The CDU suffered heavy losses, dropping from rank one in 2014 to the third place while the SPD moved to single digits.
  • According to the results, no politically viable coalition reaches a majority, unless the CDU gets serious about dropping its previous categorical rejection of cooperating with the Left. In the end, a minority government led by the Left might turn out to be the most plausible option.
  • No clear result was achieved in the SPD members’ vote on the party’s future leadership presented on Saturday.
  • All in all, last weekend’s events have certainly increased the probability of an early GroKo demise, but we still think that the status quo forces are more likely to prevail; meaning that the GroKo treaty will be the ultimate arbiter in case of (more likely) conflicts.
  • In case of snap elections over the course of 2020 (which is not our baseline), recent polls indicate a majority for a conservative-green government. Such a coalition would imply an even stronger climate/environmental focus but would hardly embark on a fundamentally different policy course from the current coalition or trigger a more expansionary fiscal policy – unless we were to see a deep recession materialise.”

14:38
Canada's GDP likely to rise by 0.1% in August – TDS

Analysts at TD Securities are expecting Canada’s industry-level to rise by 0.1% in August, helped by stronger services and a partial rebound in the goods-producing sector.

  • “Goods output fell by 0.8% in July, largely due to an offshore oil spill that shuttered production in the region. Those shutdowns have persisted into August, but strong construction investment and manufacturing activity should help drive a modest increase for the goods sector.
  • Meanwhile, services will benefit from continued strength in the housing market and a modest increase in retail trade, offset by softer wholesale activity. Other industries, such as health care & education, saw an outsized increase in hours worked during August which also bodes well for real activity. A 0.1% increase for August would leave Q1 tracking slightly below 1.5%, in line with BoC estimates from July.”
14:15
USD longs slip, EUR shorts drop – Rabobank

Analysts at Rabobank note that according to the latest CFTC Commitment of Traders Report, USD net longs slipped for a third consecutive week.

  • “The Fed’s action to relieve pressure in the US money market may have has some psychological impact in lessening demand for USDs.
  • Net EUR short positions dropped sharply to their lowest levels since early September.
  • Net short GBP positions dropped back for a sixth consecutive week to their lowest level since June.
  • JPY net positions held in negative ground for a second consecutive week.
  • Latest data show CHF net shorts falling moderately but remaining broadly stable.
  • CAD net long positions surged higher last week. Robust jobs data has strengthened the case for steady rates from the BoC going forward.
  • AUD net shorts fell last week. The AUD’s role as a proxy for confidence in China suggests that US/China trade talks are providing direction.”

13:54
BoC seen to keep rates unchanged – TDS

Analysts at TD Securities note the Bank of Canada (BoC) is widely expected to keep rates unchanged at 1.75% during the October policy meeting, where updated economic projections will balance a better-than-expected 2019 with modest downgrades to the 2020 outlook.

  • “Q2 GDP and Q3 CPI came in well above projections from the previous MPR, but the global backdrop has softened since July which will weigh on next year's GDP forecast. The policy statement should maintain a similar tone to September, with forward looking language focused on the global outlook and trade uncertainty.”

13:33
U.S. Stocks open: Dow +0.53%, Nasdaq +0.63%, S&P +0.51%
13:27
U.S. President Trump says he expects to sign "a very big portion of the China deal" ahead of schedule - Reuters

“We are looking probably to be ahead of schedule to sign a very big portion of the China deal, we’ll call it Phase One but it’s a very big portion,” he told reporters at Joint Base Andrews before leaving on a visit to Chicago.

13:14
Before the bell: S&P futures +0.41%, NASDAQ futures +0.47%

U.S. stock-index futures rose on Monday, supported by solid Q3 earnings reports and progress on U.S.-China trade.


Global Stocks:

Index/commodity

Last

Today's Change, points

Today's Change, %

Nikkei

22,867.27

+67.46

+0.30%

Hang Seng

26,891.26

+223.87

+0.84%

Shanghai

2,980.05

+25.12

+0.85%

S&P/ASX

6,740.70

+1.50

+0.02%

FTSE

7,325.99

+1.52

+0.02%

CAC

5,734.04

+11.89

+0.21%

DAX

12,952.20

+57.69

+0.45%

Crude oil

$56.67


+0.02

Gold

$1,500.20


-0.34%

13:01
Wall Street. Stocks before the bell

(company / ticker / price / change ($/%) / volume)


Amazon.com Inc., NASDAQ

AMZN

1,748.50

-12.83(-0.73%)

56520

Google Inc.

GOOG

1,275.55

10.42(0.82%)

11976

ALCOA INC.

AA

21.13

0.11(0.52%)

13508

ALTRIA GROUP INC.

MO

46.85

0.05(0.11%)

6667

Apple Inc.

AAPL

247.64

1.06(0.43%)

216323

AT&T Inc

T

37.86

0.95(2.57%)

983493

Boeing Co

BA

341.45

1.62(0.48%)

15845

Caterpillar Inc

CAT

139.82

0.09(0.06%)

6264

Chevron Corp

CVX

118.5

-0.17(-0.14%)

5353

Cisco Systems Inc

CSCO

47.15

0.25(0.53%)

14800

Citigroup Inc., NYSE

C

73.65

0.48(0.66%)

17818

Exxon Mobil Corp

XOM

69.5

0.25(0.36%)

5410

Facebook, Inc.

FB

187.09

-0.80(-0.43%)

217452

FedEx Corporation, NYSE

FDX

158.75

0.66(0.42%)

1951

Ford Motor Co.

F

8.76

0.04(0.46%)

79272

Freeport-McMoRan Copper & Gold Inc., NYSE

FCX

10.15

0.01(0.10%)

32361

General Electric Co

GE

9.02

0.02(0.22%)

66248

General Motors Company, NYSE

GM

37.19

0.45(1.22%)

13453

Goldman Sachs

GS

214.61

0.38(0.18%)

4254

Hewlett-Packard Co.

HPQ

17.4

0.07(0.40%)

1651

Home Depot Inc

HD

234.91

0.53(0.23%)

574

Intel Corp

INTC

56.37

-0.09(-0.16%)

74406

International Business Machines Co...

IBM

135.9

0.46(0.34%)

1334

Johnson & Johnson

JNJ

128.65

0.30(0.23%)

2560

JPMorgan Chase and Co

JPM

126.94

0.91(0.72%)

8363

McDonald's Corp

MCD

194.82

0.21(0.11%)

9725

Merck & Co Inc

MRK

82.75

0.49(0.60%)

4805

Microsoft Corp

MSFT

144.4

3.67(2.61%)

784856

Nike

NKE

91.3

0.38(0.42%)

1322

Pfizer Inc

PFE

36.88

0.11(0.30%)

14410

Starbucks Corporation, NASDAQ

SBUX

83.59

0.21(0.25%)

4495

Tesla Motors, Inc., NASDAQ

TSLA

327.28

-0.85(-0.26%)

108408

The Coca-Cola Co

KO

53.72

-0.03(-0.06%)

10673

Travelers Companies Inc

TRV

131.5

1.07(0.82%)

2522

Twitter, Inc., NYSE

TWTR

30.44

0.14(0.46%)

170448

Verizon Communications Inc

VZ

60.43

0.06(0.10%)

187216

Visa

V

179.08

1.23(0.69%)

22629

Walt Disney Co

DIS

131.2

0.30(0.23%)

17957

Yandex N.V., NASDAQ

YNDX

32.47

0.20(0.62%)

57618

12:59
Chicago Fed National Activity Index declines to -0.45 in September

The Chicago Federal Reserve announced on Monday the Chicago Fed national activity index (CFNAI), a weighted average of 85 different economic indicators, came in at -0.45 in September, sharply down from a revised +0.15 in August (originally +0.10), pointing to slower economic growth.

Economists had forecast the index to come in at -0.37 in September.

At the same time, the index’s three-month moving average fell to -0.25 in September from -0.10 in August.

According to the report, three of the four broad categories of indicators that make up the index dropped from August, and all four categories made negative contributions to the index in September. Production-related indicators made a negative contribution of -0.37 to the CFNAI in September, down from +0.19 in August. Meanwhile, the contribution of the sales, orders, and inventories category to the CFNAI edged down to -0.02 in September from -0.01 in August, and the contribution of the personal consumption and housing category to the CFNAI ticked down to -0.04 from a neutral value in August. Employment-related indicators contributed -0.02 to the CFNAI in September, up slightly from -0.03 in August.

12:43
Eurozone's lending growth weakens in September - ING

Bert Colijn, a senior Eurozone economist at ING, suggests the slowdown in M3 money supply from 5.8 to 5.5% year-on-year in September is not necessarily very alarming. 

"The indicator had seen strong growth over recent months, which was also found in the narrow money aggregate M1, a clear green shoot for a growth pickup in the middle of next year. A one-month blip is not necessarily alarming, but in the light of an already weak economy should be treated with caution.

More concerning is the weakness in private sector lending growth, which declined slightly from 3.8 to 3.7% in September mainly due to a decline in the growth rate of non-financial corporate lending. This drop from 4.3 to 3.7% represents a weakening of the credit impulse and could reflect reluctance in borrowing among businesses as concerns about the economy become widespread.

Next month should show whether this was a one-off blip or whether uncertainty is starting to have more of a material impact on lending demand. That would add to concerns about a prolonged slow growth environment or perhaps even worse."

12:30
U.S.: Goods Trade Balance, $ bln., September -70.39
12:30
U.S.: Chicago Federal National Activity Index, September -0.45 (forecast -0.37)
12:21
ECB's Draghi bows out – RBS

According to analysts at the Royal Bank of Scotland (RBA), ECB’s outgoing President Mario Draghi failed to pull any rabbits out of the hat at his last meeting.

  • “He will be forever remembered for the phrase “whatever it takes” in the summer of 2012 when fears of a break-up of the Euro area were in the ascendancy. The tone of his last press conference was downbeat, highlighting latest weak business surveys.
  • He was diplomatic about recent opposition from some ECB Council members to lowering official rates further into negative territory and the resumption of QE, starting 1st November. Over to you Mrs Lagarde!”

11:58
CFTC Positioning Report: EUR net shorts fall to six-week lows

The CFTC Positioning Report for the week ended on October 22 revealed the following:

  • The better prospects around the Brexit negotiations improved the sentiment around the Sterling and forced net shorts to retreat to multi-week lows. However, uncertainty around the process and UK politics resurfaced after the cut-off data, surely reflecting in the next report.
  • USD net longs dropped to the lowest level since late August on the back of the persistent optimism around a Brexit deal and the effect on the rest of the risk-associated complex.
  • By the same token, EUR net shorts went down to the lowest level in the last six weeks. However, the confirmation of the ‘looser for longer’ policy by the ECB at its meeting (after the cut-off date) might have prompted changes in the next report.

11:56
Company News: Walgreens Boots Alliance (WBA) quarterly earnings beat analysts’ forecast

Walgreens Boots Alliance (WBA) reported Q4 FY 2019 earnings of $1.43 per share (versus $1.48 in Q4 FY 2018), beating analysts’ consensus estimate of $1.41.

The company’s quarterly revenues amounted to $33.954 bln (+1.5% y/y), generally in line with analysts’ consensus estimate of $33.884 bln.

WBA rose to $56.50 (+1.95%) in pre-market trading.

11:50
Company News: AT&T (T) posts quarterly earnings in line with analysts' estimate

AT&T (T) reported Q3 FY 2019 earnings of $0.94 per share (versus $0.90 in Q3 FY 2018), being in line with analysts’ consensus estimate.

The company’s quarterly revenues amounted to $44.588 bln (-2.5% y/y), missing analysts’ consensus estimate of $45.449 bln.

The company also issued upside guidance for FY 2019, projecting EPS of $3.60-3.70 versus analysts’ consensus estimate of $3.58 and revenue of ~$184-186 bln (+1-2% y/y) versus analysts’ consensus estimate of $182.45 bln.

T rose to $37.15 (+0.65%) in pre-market trading.

11:37
Contraction in UK retail sales eases further in October - CBI

The Confederation of British Industry (CBI) reported on Monday its latest survey of retailers showed retail sales volume balance rose to -10 in October from -16 in September. That marked the sixth consecutive month of decline in retail sales volume, but at the slowest pace over this period so far.

Economist had forecast the reading to come in at -20.

The report also revealed that orders placed on suppliers (-9) also dropped in the year to October (-4 percent), albeit at a slightly slower pace than September (-9 percent). Meanwhile, retailers expect sales volumes to be broadly flat next month (+1 percent) and orders to deteriorate next month (-22 percent).

Rain Newton-Smith, CBI Chief Economist, noted: “Retailers have now endured six months of falling sales, the longest period of decline since the financial crisis. The sector is struggling with ongoing digital disruption, layered on top of cost pressures from a weak pound and the cumulative burden of an outdated business rates regime. Retailers have also had to contend with the looming Brexit deadline, which has partly driven a record spike in stocks. The timing could not be worse: the run-up to Christmas is a crucial time of year for the retail sector, and not knowing where we will be on November 1st is adding more strain to an already beleaguered sector.”

11:23
UK politics again at center stage – TDS

Analysts at TD Securities note that the UK politics are again at center stage as the EU this morning signed off on an Article 50 extension to 31 January, but with exit dates on 1 Dec or 1 Jan if the Withdrawal Agreement is passed.

  • “The EU now awaits the UK's acceptance of this offer (which it legally must do under the Benn Act, but the tail risk is that the UK rejects it in the hopes of fighting the extension in the courts).
  • Later today (around 1pm ET), Parliament will vote on whether or not to hold a general election on 12 December as PM Johnson has proposed. This route requires a 2/3 majority in parliament, which will necessitate close to half of Labour MPs voting in favour of an election. This is unlikely as Labour has said that it will not vote in favour of an election until No Deal is taken off the table in all scenarios, including at the end of 2020.
  • The SNP and Lib Dems have also proposed an election motion that would require just 50%+1 of MPs to trigger a 9 December election (ie, without Labour support). If the Conservatives agree to this strategy, and some are suggesting they will, it will be debated and voted on sometime between Tuesday and Thursday this week, and a December election could be on the cards.”

11:19
Earnings Season in U.S.: Major Reports of the Week

October 28

Before the Open:

T&T (T). Consensus EPS $0.94, Consensus Revenues $45449.24 mln

Walgreens Boots Allianc (WBA). Consensus EPS $1.41, Consensus Revenues $33884.45 mln

After the Close:

Alphabet (GOOG). Consensus EPS $12.71, Consensus Revenues $40167.03 mln

October 29

Before the Open:

General Motors (GM). Consensus EPS $1.38, Consensus Revenues $35213.97 mln

MasterCard (MA). Consensus EPS $2.01, Consensus Revenues $4413.88 mln

Pfizer (PFE). Consensus EPS $0.61, Consensus Revenues $12365.25 mln

After the Close:

Advanced Micro (AMD). Consensus EPS $0.18, Consensus Revenues $1806.53 mln

October 30

Before the Open:

General Electric (GE). Consensus EPS $0.12, Consensus Revenues $29023.43 mln

United Micro (UMC). Consensus EPS $0.22, Consensus Revenues $37551.18 mln

After the Close:

Apple (AAPL). Consensus EPS $2.83, Consensus Revenues $62862.02 mln

Facebook (FB). Consensus EPS $1.86, Consensus Revenues $17353.45 mln

Lyft (LYFT). Consensus EPS -$0.74, Consensus Revenues $915.15 mln

Starbucks (SBUX). Consensus EPS $0.70, Consensus Revenues $6681.17 mln

October 31

Before the Open:

Altria (MO). Consensus EPS $1.15, Consensus Revenues $5355.19 mln

DuPont (DD). Consensus EPS $0.95, Consensus Revenues $5433.36 mln

Int'l Paper (IP). Consensus EPS $1.00, Consensus Revenues $5633.34 mln

November 1

Before the Open:

Alibaba (BABA). Consensus EPS $10.68, Consensus Revenues $116512.09 mln

American Intl (AIG). Consensus EPS $1.02, Consensus Revenues $12135.02 mln

Chevron (CVX). Consensus EPS $1.51, Consensus Revenues $37690.26 mln

Exxon Mobil (XOM). Consensus EPS $0.66, Consensus Revenues $65864.29 mln

11:00
United Kingdom: CBI retail sales volume balance, October -10 (forecast -20)
10:39
China expects strong financial ties with UK in future - Chinese ambassador

Britain and China are building the foundations for strong future cooperation in financial services as the UK readies to leave the European Union, H.E. Liu Xiaoming, China's ambassador to Britain, said on Monday.

"There is a broad and promising future for cooperation," he told a conference, singling out fintech and green finance.

Recent violence in Hong Kong has "inevitably affected" the business environment there, but with strong support from China's central government and the government of Hong Kong, law and order will be restored, he said.

"Hong Kong will continue to be a financial bridge between East and West," he said.

10:21
China capital outflows rose modestly in September – Standard Chartered

While a soft DXY supported the Chinese yuan (CNY) for most of September, escalating trade tensions weighed on market sentiment, writes Hunter Chan – Economist Greater China at Standard Chartered.

"The US and China imposed additional tariffs on each other’s goods starting from 1 September. While talks between the two sides continue, the date for high-level trade talks in October was not confirmed until the last week of September. Against this backdrop, non-FDI capital outflows picked up to USD 19.7bn in September from a modest USD 11.5bn in August, according to our estimate. FX assets held by the People’s Bank of China (PBoC) saw a small decline of USD 0.1bn, indicating that overall cross-border flows remained balanced. The merchandise trade surplus widened to USD 39.6bn in September after narrowing for two months, leading to a larger Q3-2019 surplus relative to Q2. Meanwhile, we estimate that the September services trade deficit shrank to USD 22.9bn. We calculate that total net capital outflows (including net FDI inflows of USD 2.8bn) edged up by USD 7.3bn to USD 16.9bn in September -- still modest compared with June (USD 31.8bn) and July (USD 20.3bn). The latest data from the State Administration of Foreign Exchange (SAFE) shows that net FX sales picked up in September and the willingness to convert FX receipts into CNY declined. SAFE recently announced new measures to facilitate cross-border trade and investment, including simplifying administrative procedures for FX payment and receipt and removing some payment restrictions on the capital account. The measures aim to improve the business environment and attract foreign capital.

09:59
EU agrees to give the UK a Brexit extension until January 31

The European Union has agreed to give the U.K. three more months to exit the bloc. European Council President Donald Tusk, who chaired the talks among the 27 European governments, announced the decision on Twitter: “The EU27 has agreed that it will accept the U.K.’s request for a Brexit flextension until 31 January 2020. The decision is expected to be formalised through a written procedure.”

This means that the U.K. will be able to leave the EU at any point before January 31, provided that its Parliament approves the exit agreement that Prime Minister Boris Johnson concluded with the other 27 EU leaders earlier this month.

Tusk’s announcement came after a meeting between the 27 European ambassadors, in Brussels, where they signed off on a third delay.

09:40
Brexit, FOMC meeting amongst market movers this week – Danske Bank

The Danske Bank analysts provide brief insights on the important events of note, scheduled this week.

"We have a slow start to a very important week today. Today we get euro area monetary aggregates and loan data and Swedish trade balance is also released. After years of negative prints, the trend is once again positive, surely helped by the weak SEK. Our forecast is for a SEK5bn surplus, but this should not be a market mover. Focus this week will be on the Brexit deadline on Thursday (although we expect another extension) and FOMC meeting on Wednesday (where we expect a cut). We also have Bank of Japan policy meeting where markets price around some 50% probability of a rate cut. On Friday, we expect a weak US job report, with an increase of just 50,000. Preliminary Q3 GDP data for both the euro area and the US are due out".

09:19
Eurozone: annual growth rate of the monetary aggregate M3 decreased in September

According to the report from European Central Bank, the annual growth rate of the broad monetary aggregate M3 decreased to 5.5% in September 2019 from 5.8% in August, averaging 5.5% in the three months up to September. The components of M3 showed the following developments. The annual growth rate of the narrower aggregate M1, which comprises currency in circulation and overnight deposits, decreased to 7.9% in September from 8.5% in August. The annual growth rate of short-term deposits other than overnight deposits (M2-M1) increased to 1.2% in September from 1.0% in August. The annual growth rate of marketable instruments (M3-M2) was -1.6% in September, compared with -2.7% in August.

Annual growth rate of adjusted loans to households stood at 3.4% in September, unchanged from previous month

Annual growth rate of adjusted loans to non-financial corporations decreased to 3.7% in September from 4.3% in August

08:59
Eurozone: M3 money supply, adjusted y/y, September 5.5% (forecast 5.7%)
08:59
Eurozone: Private Loans, Y/Y, September 3.4% (forecast 3.5%)
08:40
Goldman says rush from stocks to cash, bonds biggest since 2008

The outflow from U.S. equity funds this year has been the biggest since 2008, relative to the flood of money into cash and bonds, according to Goldman Sachs Group Inc.

That still leaves cash exposures “near historical lows,” according to Goldman strategists led by David Kostin. At 12%, the aggregate allocation to cash is only in the fifth percentile of the past 30 years, they calculated.

“High uncertainty, investor fears of a recession, and low starting cash allocations will likely limit a significant increase in equity allocations” in 2020, the Goldman team said.

Just like this year, corporate demand will be the top source of U.S. equity buying in 2020, Goldman projected. While buybacks may drop, net demand is still seen as strong thanks to diminished initial public offerings and a rise in cash-based mergers and acquisitions. Households and foreign investors will also be net buyers, while pension funds keep whittling down their allocation, as they have since 2009, Goldman said.

08:19
USD/CAD: Oversold on daily chart; sidelined n-term - Citi

Citi discusses USD/CAD technical outlook and shifts to a neutral bias in the near-term.

"Momentum on the daily chart has now moved to the most oversold we have seen since after the double top in late December 2017 and is starting to turn up. That turn higher in momentum in Jan 2018 saw a good bounce in USDCAD," Citi notes. 

"With some overall lack of momentum short-term in the USD down move starting to develop and a lot of event risk beckoning we are happy to move to the sidelines on this," Citi adds.

08:00
EU will 'most likely' agree Jan. 31 Brexit delay on Monday - French source

The European Union will “most likely” agree to delay Brexit until Jan.31 on Monday, said a source close to French President Emmanuel Macron who last week prevented the bloc from reaching a decision on the delay.

“There will most likely be an agreement on Monday morning between the 27 on extension until January 31,” the source said, adding that came after Macron spoke to British Prime Minister Boris Johnson during the weekend.

“The prospect of elections has strengthened significantly over the weekend,” the source added, stressing the third postponement of Brexit would come with conditions. They include a refusal to renegotiate Johnson’s divorce agreement and giving a green light to the 27 other EU countries to meet without Britain to discuss the bloc’s future.

07:44
Decline in GBP/USD expected to hold around 1.2760/00 – Commerzbank

The correction lower in Cable should meet strong contention in the 1.2760/00 band, suggested Karen Jones, Team Head FICC Technical Analysis Research at Commerzbank.

“GBP/USD last week failed at psychological resistance at 1.30, and is correcting lower very near term. Dips are indicated to hold circa 1.2760/00. Directly above here we have the 200 week ma at 1.3138 and the 1.3187 May high and these remain our short term targets. For now, provided dips lower hold over 1.2582 (20th September high) an immediate upside bias is maintained. The 1.3187 May high guards the 1.3382 2019 high. Below 1.2582 lies the 1.2382 17th July low and the 1.2285 uptrend. The near term uptrend guards 1.2196/94”.

07:30
EUR/USD could slip back to 1.1060/30 ahead of rebound – Commerzbank

In opinion of Karen Jones, Team Head FICC Technical Analysis Research at Commerzbank, EUR/USD could drop and test the 1.1060/30 band ahead of a potential recovery.

“EUR/USD spent much of the week easing back from the 200 day ma at 1.1201 and then the top of the channel at 1.1283 this week. The 55 week ma lies at 1.1248. Very near term we would allow for slippage to the 1.1060/1.1030 vicinity ahead of recovery. Longer term the critical resistance to overcome is the 200 week ma at 1.1356 and while we would allow for this zone of resistance to hold the initial test, longer term we look for a break higher to feature. This will target 1.1520/70, the 2019 high, as a minimum”.

07:15
Germany's import prices fell 2.5% in September

According to the report from Federal Statistical Office (Destatis), the index of import prices decreased by 2.5% in September 2019 compared to the corresponding month of the preceding year. Economists had expected a 2.4% decrease. In August 2019 and in July 2019 the annual rates of change were -2.7% and -2.1%, respectively. 

From August 2019 to September 2019 the index rose by 0.6%. Economists had expected a 0.2% increase.

The index of import prices, excluding crude oil and mineral oil products, decreased in September 2019 by 1.6% compared to September 2018 and in comparison with August 2019 it rose by 0.4%.

The index of export prices remained unchanged in September 2019 compared to the corresponding month of the preceding year. In August 2019 and in July 2019 the annual rates of change were -0.1% and +0.2%, respectively. From August 2019 to September 2019 the index slightly rose by 0.1%.

06:59
China's industrial profits declined at a faster pace in September

Data from the National Bureau of Statistics showed that China's industrial profits declined at a faster pace in September as producer prices continued to fall.

Industrial profits decreased 5.3 percent year-on-year, after easing 2 percent in August. During January to September, profits earned by industrial firms declined 2.1 percent compared to a 1.7 percent drop in January to August period.

Profits of state owned enterprises fell 9.6 percent on year and that of private enterprises increased 5.4 percent. Larger decline in profits reflects faster fall in industrial product prices and slower rise in sales, bureau said.

06:26
Options levels on monday, October 28, 2019 EURUSD GBPUSD

EUR/USD

Resistance levels (open interest**, contracts)

$1.1178 (2927)

$1.1150 (3591)

$1.1124 (2237)

Price at time of writing this review: $1.1087

Support levels (open interest**, contracts):

$1.1034 (2503)

$1.0993 (4024)

$1.0947 (3370)


Comments:

- Overall open interest on the CALL options and PUT options with the expiration date November, 8 is 72536 contracts (according to data from October, 25) with the maximum number of contracts with strike price $1,1000 (4024);


GBP/USD

Resistance levels (open interest**, contracts)

$1.3043 (2273)

$1.2980 (1912)

$1.2914 (1527)

Price at time of writing this review: $1.2823

Support levels (open interest**, contracts):

$1.2717 (166)

$1.2686 (191)

$1.2651 (292)


Comments:

- Overall open interest on the CALL options with the expiration date November, 8 is 31100 contracts, with the maximum number of contracts with strike price $1,3200 (3744);

- Overall open interest on the PUT options with the expiration date November, 8 is 28240 contracts, with the maximum number of contracts with strike price $1,2100 (3168);

- The ratio of PUT/CALL was 0.91 versus 0.90 from the previous trading day according to data from October, 25

 

* - The Chicago Mercantile Exchange bulletin (CME) is used for the calculation.

** - Open interest takes into account the total number of option contracts that are open at the moment.

02:30
Commodities. Daily history for Friday, October 25, 2019
Raw materials Closed Change, %
Brent 61.62 0.75
WTI 56.58 0.98
Silver 18.02 1.35
Gold 1504.103 0.08
Palladium 1763.42 -0.25
00:30
Stocks. Daily history for Friday, October 25, 2019
Index Change, points Closed Change, %
NIKKEI 225 49.21 22799.81 0.22
Hang Seng -130.56 26667.39 -0.49
KOSPI 2.23 2087.89 0.11
ASX 200 45.6 6739.2 0.68
FTSE 100 -3.78 7324.47 -0.05
DAX 22.41 12894.51 0.17
CAC 40 37.82 5722.15 0.67
Dow Jones 152.53 26958.06 0.57
S&P 500 12.26 3022.55 0.41
NASDAQ Composite 57.32 8243.12 0.7
00:15
Currencies. Daily history for Friday, October 25, 2019
Pare Closed Change, %
AUDUSD 0.68199 0.05
EURJPY 120.395 -0.19
EURUSD 1.10792 -0.23
GBPJPY 139.332 -0.11
GBPUSD 1.28224 -0.15
NZDUSD 0.63484 -0.51
USDCAD 1.30576 -0.1
USDCHF 0.9944 0.28
USDJPY 108.66 0.04

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