Tin tức thì trường

Major US stocks rose moderately, updating historic highs as Walt Disney Co. stocks rose. (DIS) and Best Buy (BBY) outweighed the fall of Dollar Tree (DLTR) stocks and disappointing US consumer confidence data.

A Conference Board report showed that the consumer confidence index fell to 125.5 in November from a revised upward increase of 126.1 in October. Economists had expected the index to rise to 127.0 from 125.9, which was originally reported the previous month. An unexpected drop in the overall index occurred amid a deterioration in the component of the current situation - to 166.9 from 173.5 in October. "A decline in the current situation index suggests that economic growth in the last quarter of 2019 will remain weak," said Lynn Franco, senior director of economic performance at The Conference Board.

In addition, a report released by the Department of Commerce showed that new home sales in the United States declined slightly in October. According to the report, sales of new homes fell 0.7% to an annual level of 733,000 in October, after rising 4.5% to a revised upwards figure of 738,000 in September. Economists had expected new home sales to rise 1.1% to 709,000 from 701,000 in September, which were originally reported. With a revision upward, sales of new homes in September were at the highest level since reaching 778,000 in July 2007.

Investors also continued to monitor the progress of trade negotiations between the US and China. Beijing said this morning that the negotiators had reached consensus on a number of key issues. A few hours later, White House adviser Kellianne Conway said the parties were “very close to an agreement,” but there were still controversial issues, such as “forced technology transfer, intellectual property theft, and a trade imbalance of half a trillion dollars a year with the second largest economy Peace, China. ”

Most of the DOW components completed trading in positive territory (18 of 30). The biggest gainers were The Walt Disney Co. (DIS; + 1.56%). The outsider was Walgreens Boots Alliance (WBA; -1.62%).

Most S&P sectors recorded an increase. The largest growth was shown by the services sector (+ 0.6 %%). The largest decline was shown in the raw materials sector (-0.7%).

At the time of closing:

Dow 28,120.66 +54.19 +0.19%

S&P 500 3,140.40 +6.76 +0.22%

Nasdaq 100 8,647.93 +15.44 +0.18%

Russian news agency TASS reports that OPEC countries unanimously support the feasibility of extending the agreement on the reduction of oil production (OPEC+) after March 2020, when it expires. According to three sources in delegations familiar with the talks, the extension for 3-6 months is being discussed. 

"The extension after March is the least we can do. But most likely we will not increase the reduction volume," one of the sources told TASS.

The source specified that one of the options is a six-month extension. Meanwhile, another source said that the probable term of extension is 3 months.

"Then there will be a new meeting, we will decide what to do next," the source added.

The U.S. Commerce Department announced on Thursday that the sales of new single-family homes fell 0.7 percent m-o-m to a seasonally adjusted annual rate of 733, 000 units in October.

Economists had forecast the sales pace of 709,000 last month.

September’s sales pace was revised up to 738,000 units from the originally reported 701,000 units.

According to the report, new home sales in the South, the largest area, decreased 3.3 percent m-o-m in October, while sales in the Northeast tumbled 18.2 percent m-o-m. At the same time, sales of new homes in the West surged 7.1 percent m-o-m and sales in the Midwest climbed 4.2 percent m-o-m.

In y-o-y terms, new home sales recorded a 31.6 percent surge in October.

The Conference Board announced on Tuesday its U.S. consumer confidence gauge fell 0.6 points to 125.5 in October from 126.1 in October.

Economists had expected consumer confidence to come in at 127.0.

October’s consumer confidence reading was revised up from originally estimated 125.9.

The survey showed that the expectations rose from 94.5 last month to 97.9 this month, while the present situation index dropped from 173.5 to 166.9.

Lynn Franco, Senior Director of Economic Indicators at The Conference Board, noted, “Consumer confidence declined for a fourth consecutive month, driven by a softening in consumers’ assessment of current business and employment conditions. The decline in the Present Situation Index suggests that economic growth in the final quarter of 2019 will remain weak. However, consumers’ short-term expectations improved modestly, and growth in early 2020 is likely to remain at around 2 percent. Overall, confidence levels are still high and should support solid spending during this holiday season.”

S&P reported on Tuesday its Case-Shiller Home Price Index, which tracks home prices in 20 U.S. metropolitan areas, rose 2.1 percent y-o-y in September, following an unrevised 2.0 percent y-o-y increase in August.

Economists had expected an advance of 2.1 percent y-o-y.

Phoenix (+6.0 percent y-o-y), Charlotte (+4.6 percent y-o-y) and Tampa (+4.5 percent y-o-y) recorded the highest y-o-y gains in September.

Meanwhile, the S&P/Case-Shiller U.S. National Home Price Index, which measures all nine U.S. census divisions, was up 3.2 percent y-o-y in September, up from 3.1 percent y-o-y in the previous month.

"September’s report for the U.S. housing market is reassuring,” noted Craig J. Lazzara, Managing Director and Global Head of Index Investment Strategy at S&P Dow Jones Indices. “After a long period of decelerating price increases, it’s notable that in September both the national and 20-city composite indices rose at a higher rate than in August, while the 10-city index’s September rise matched its August performance. It is, of course, too soon to say whether this month marks an end to the deceleration or is merely a pause in the longer-term trend,’ he added. 

U.S. stock-index futures rose on Tuesday as investors took a breather after equities rose to record highs in the previous session amid expectations that China and the U.S. could reach a so-called phase one trade deal.

Global Stocks:

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

McDonald's (MCD) initiated with a Hold at Deutsche Bank; target $193

Walt Disney (DIS) initiated with an Overweight at Consumer Edge Research; target $175

Chevron (CVX) resumed with an Overweight at Piper Jaffray; target $143

Exxon Mobil (XOM) resumed with a Neutral at Piper Jaffray; target $83

Tesla (TSLA) downgraded to Hold from Buy at China Renaissance; target $346

The U.S. Commerce Department reported on Tuesday U.S. the goods trade deficit narrowed to $66.53 billion in October from $70.55 billion in the previous month.

Economists had expected a deficit of $71.30 billion.

According to the report, goods exports declined 0.7 percent pulled down by drops in sales of consumer goods (-4.0 percent), foods, feeds & beverages (-3.0 percent), and vehicles (-2.4 percent). Meanwhile, goods imports fell 2.4 percent due to decreases in purchases of vehicles (-5.9 percent), consumer goods (-4.8 percent), foods, feeds & beverages (-2.9 percent), and industrial supplies (-1.9 percent).

Best Buy (BBY) reported Q3 FY 2019 earnings of $1.13 per share (versus $0.93 in Q3 FY 2018), beating analysts’ consensus estimate of $1.03.

The company’s quarterly revenues amounted to $9.764 bln (+2.10% y/y), generally in line with analysts’ consensus estimate of $9.707 bln.

The company also issued in-line guidance for Q4, projecting EPS of $2.65-2.75 vs. analysts’ consensus estimate of $2.66 and revenues of $14.75-15.15 bln vs. analysts’ consensus estimate of $14.99 bln.

BBY rose to $77.95 (+4.98%) in pre-market trading.

Dollar Tree (DLTR) reported Q3 FY 2019 earnings of $1.08 per share (versus $1.18 in Q3 FY 2018), missing analysts’ consensus estimate of $1.13.

The company’s quarterly revenues amounted to $5.746 bln (+3.7% y/y), in line with analysts’ consensus estimate of $5.739 bln.

The company also issued guidance for Q4, projecting EPS of $1.70-1.80 vs. analysts’ consensus estimate of $2.03 and revenues of $6.33-6.44 bln vs. analysts’ consensus estimate of $6.4 bln. For the full year, the company projected EPS of $4.66-4.76 versus analysts’ consensus estimate of $5.11 and revenues of $23.62-23.74 bln vs. analysts’ consensus estimate of $23.69 bln and its prior estimate of $23.57-23.79 bln.

DLTR fell to $98.40 (-12.45%) in pre-market trading.

Analysts at Westpac point out that the RBNZ’s six–month review of the financial system often serves as a window for reviewing the loan–to–value restrictions on mortgage lending.

• “The LVR restrictions have been loosened twice so far, in November 2017 and 2018.
• We do not expect a further change at this review. House prices are up by just 3.9% in the last year, but there has been a marked acceleration in recent months as mortgage rates have fallen sharply and the threat of a capital gains tax has been removed. The RBNZ will be wary of adding more stimulus at this point.
• The RBNZ is unlikely to make any substantial comment on its proposal to increase bank capital requirements, ahead of the announcement scheduled for 5 December.”

• Monetary policy is in the right place right now
• We now have a more normally shaped yield curve
• Economy needs more than just monetary policy
• We've got a good chance to grow 2% next year
• But Q4 this year is going to be weak

FX Strategists at UOB Group suggested that USD/JPY could re-visit the 109.50 region in the next weeks.

• "24-hour view: USD edged to a high of 108.97 before ending the day on a firm note at 108.90 (+0.24%). Upward momentum has picked up and USD could extend its gains towards 109.15. For today, a move beyond the next resistance at 109.30 is unlikely. Support is at 108.75 followed by 108.60.
• Next 1-3 weeks: USD closed on a firm note yesterday (108.90, +0.23%) and the recent downward pressure has eased (we previously expected USD to trade with a downward bias towards 108.00). From here, USD is likely to trade sideways even though the uptick in momentum suggests it is likely to probe the top of the expected 108.50/109.50 range first."

Bill Diviney, the senior economist at ABN AMRO, notes that with Brexit delayed at least until January, and uncertainty probably persisting for much of next year, he expects only a mild recovery in UK’s investment and solid, if unspectacular growth in private consumption.

• “Key risks for the near-term outlook will be 1) whether recent signs of labour market weakness develop into a more significant downturn, and 2) how quickly planned government spending increases might come on stream. The latter naturally will depend on the election outcome, but both Conservatives and Labour are promising big spending increases, despite high levels of government debt – with Labour promising to outspend the Conservatives, perhaps significantly. This should lift growth later in 2020 and into 2021, by which time we expect growth to be closer to trend.
• The medium-term outlook is less positive, given how weak UK macro fundamentals are. With businesses paralyzed by Brexit uncertainty and investment flatlining for the past two years, productivity growth is suffering.
• Things are scarcely better on the household side; while consumer confidence has held up better than business confidence, and real wage growth has picked up, household balance sheets are in a parlous state, with household debt not far off pre-recession highs at 90% of GDP, and the savings rate just shy of historically low levels. This makes households highly vulnerable to any downturn.”

Analysts at TD Securities note that consensus is expecting the U.S. consumer confidence to improve modestly in November to 127.0 from 125.9 before.

• “If confirmed, the Conference Board's measure would remain at healthy levels, which would be positive for the prospects of private spending.
• Separately, new home sales likely advanced marginally in October (+0.9% to 707k), continuing with the momentum in the housing sector on the back of low mortgage rates and a resilient labor market.
• Lastly, Governor Lael Brainard will offer an update regarding the Fed's Framework review at 1pm EST. The Governor may also take the opportunity to offer her latest views on the economy and the current stance of monetary policy.”

• China's economy is facing greater uncertainties and challenges
• To face more challenges in 2021-2025

China’s central bank issued a draft guidelines on Tuesday on the evaluation of the country’s systemically important banks.

The guidelines will help regulators to identify lenders that are crucial to China’s financial system, and thus reduce and fend off major financial risks, the People’s Bank of China (PBOC) said on its official website.

A list of systemically important banks will be jointly reviewed and announced by the PBOC and the China Banking and Insurance Regulatory Commission (CBIRC) once a year, according to the statement.

Yet the draft didn’t elaborate on the detailed list of banks nor specific requirements they need to meet with.

Industry figures showed that mortgage approvals by British banks fell in October to a seven-month low, adding to signs of a subdued housing market ahead of Brexit and a general election due on Dec. 12 election.

Lenders approved 41,219 mortgages in October, down from 42,216 in September, industry association UK Finance said.

However, the value of secured lending rose in October by 3.452 billion pounds, the largest increase since March 2016, from 2.457 billion pounds in September.

Consumer lending increased by 4.5% in annual terms in October, accelerating from 4.4% in September and marking the highest rate since February 2018.

In view of Bill Diviney, senior economist at ABN AMRO, as the political stalemate over Brexit has dragged on for the UK economy, so the economic damage has increased and become harder to reverse.

“While avoiding predictions of a recession in the post-referendum aftermath, the threat of a no-deal, disorderly Brexit has hit both consumption and investment. The initial victim was disposable household incomes, as the fall in sterling drove higher inflation, without a corresponding increase in wage growth. To some extent, consumers dipped into savings to make up the shortfall in income growth, driving the savings rate to historically low levels. However, since the referendum, consumption growth has fallen from an average 3.3% pace in 2015-16, to 1.7% in 2017-19. A stagnation in investment has followed; while initially holding up after the referendum, investment has essentially flatlined since mid-2017. After contracting -0.1% in 2018, our forecast is for zero investment growth in 2019 – this compares with the average 3.0% growth pace over 2015-17. Taken together, weaker consumption and investment have driven overall GDP growth down from 2.1% in 2015-16 to 1.4% in 2018, and our projection of 1.2% in both 2019-20.”

In opinion of FX Strategists at UOB Group, Cable is seen keeping the rangebond theme unchanged for the next weeks.

24-hour view: “GBP staged a surprisingly rapid and robust rebound as it regained most of last Friday’s steep drop. While upward momentum has not improved by all that much, there is scope for GBP to test 1.2930. For today, the next resistance at 1.2960 is unlikely to come into the picture. Support is at 1.2870 followed by 1.2850”.

Next 1-3 weeks: “While GBP dropped sharply last Friday (22 Nov), it rebounded strongly and recovered most of its loss yesterday (1.2898, +0.49%). Indicators are showing mixed signals and from a slightly longer-term perspective, the price action since last month’s 1.3012 peak could be part of a broad and prolonged sideway consolidation phase (note that we previously expected GBP to stay underpinned but held the view that a move above 1.3012 is unlikely). To put it another way, GBP could trade between 1.3012 and the month-to-date low near 1.2770 for a while more”.

A European Central Bank board member has said Europe must overcome its reliance on international payment providers - but that it is not the central bank's job to come to the rescue and crowd out private sector initiatives.

More than two-thirds of non-cash payments are made with overseas cards as most competing European providers tend to be focused domestically or regionally, Benoit Coeure told a conference. He said this put the euro zone at a competitive disadvantage.

"Europe is at risk of losing its economic edge," Coeure said. "Country-specific solutions lack the necessary size and scale, and national fragmentation has paralysed competition and stifled innovation on the pan-European level."

The ECB is now studying the option of introducing a digital currency, but this would have broader consequences for the banks. Coeure warned against the central bank crowding out private-sector players.

• QE is "not on our agenda" at this point

• QE would only be considered should cash rate reach 0.25%

• There may come a point when QE would help but I "don't expect us to get there"

• Still expects economy to move in the right direction, albeit gradually

• QE would be considered if evidence accumulates that we were unlikely to meet policy goals

• Need evidence that moving away from, rather than towards, goals for full employment, inflation

• Board would then consider buying government bonds as only QE measure

• Would hope other public policy options were also on the agenda

• Use of all QE measures could create "inaction" bias for other policy makers

• Negative interest rates in Australia are extraordinarily unlikely

• We have no appetite" to make outright purchases of private sector assets as part of qe

• No need to provide extra liquidity through market operations

• International experience suggests QE does put downward pressure on both rates and exchange rate

• Would need to balance these positive effects with possible side-effects

• Would need to consider effects of bond buying on market functioning

• Strong evidence that various central bank liquidity measures worked during crisis

• Less convinced that other unconventional measures worked, jury still out

Timme Spakman, economist at ING, notes that world trade declined 1.3% month-on-month, dragging third quarter trade down 1% compared to the same period a year ago.

“News about the negotiations between the US and China has been mixed at best and trade remains subdued: New trade figures released by the CPB show a deceleration in trade growth after two months of MoM growth. In recent weeks, it looked like the US and China were approaching a phase one deal. However, officials from both parties have been giving mixed signals, highlighting the fragility of the talks. And uncertainty still reigns in Europe. Tariffs on American automotive imports seem to be off the table for now, as President Trump missed the 14 November deadline to take a decision on the matter. Trade tensions have slammed the brake on world trade growth in 2019. While the trade war has directly affected trade flows between China and the US, the fallout has been widespread.”

Britain’s opposition Labour Party has squeezed the governing Conservatives’ opinion poll lead to 11 points from 18 over the last week, a survey by Kantar showed on Tuesday, ahead of a Dec. 12 election.

Support for Prime Minister Boris Johnson’s Conservatives fell 2 points to 43%, while Labour was up 5 points on 32%. The pro-European Union Liberal Democrats were down 2 points on 14%, while the Brexit Party was up 1 point on 3%.

Kantar surveyed 1,097 people online between Nov. 21 and 25.

The poll is the second in two days to show a narrowing of the Conservatives’ lead. On Monday, an ICM poll for Reuters gave the Conservatives a 7-point lead, down from 10 points a week earlier.

Danske Bank analysts point out that yesterday's IFO data out of Germany supported the stabilisation signals from the new order component from German manufacturing PMIs last week. 

“Just as in the previous month, the improvement in expectations was quite broad-based across industry, services and especially trade. In contrast to Friday's PMIs, which indicated a further slowdown in German service sector activity, IFO signals that services firms see robust demand and expect activity still to pick up in the coming six months. The truth is probably somewhere in between, but bottom line is that Germany is edging slowly but steadily away from downswing territory. That said, there is still some distance to cover before we are back in upswing territory, especially for manufacturing, which by all indications will stay in recession territory in Q4.”

Bill Diviney, senior economist at ABN AMRO, suggests that cutting through the noise of the many recent developments in the UK, by far the most important for the economic outlook has been the significant fall in the chance of a no-deal, disorderly Brexit.

“This occurred because of two things: first, the so-called ‘Benn’ Act which forced the government to request a delay to Brexit at the end of October. Second, PM Johnson managed to secure a deal that his hard Brexit cabinet could support. This has narrowed the likely outcomes of the looming election to Johnson’s new deal on one side, and a soft Brexit or Remain outcome on the other side. While risks remain, the tail risk of a disorderly Brexit is significantly lower. In this note, we will explore the likelihood of each of these outcomes, and the implications for the UK economic outlook.”

China will take further steps to curb property bubbles, stabilizing housing as well as land prices to fend off financial risks, the Communist Party chief of the central bank said.

China will step up disclosure and disposal of non-performing bank loans, Guo Shuqing was quoted as saying in an online post released by People's Bank of China (PBOC) on Tuesday. Guo, the PBOC party chief, is also the top regulator for the banking and insurance sectors.

Guo said that Beijing will also actively support deep reform of small and medium banks, and encourage them to replenish capitals via various channels.

Credit Suisse discusses GBP/USD technical outlook and flags a scope for a classic bull “wedge” continuation pattern.

"A clear and sustained break above 1.2976/85 would therefore further reinforce the up move, with the next resistance then seen at the 1.3013 high, above which would trigger the pattern. Next resistance would then be seen at 1.3077 initially – the 78.6% retracement of the 2019 downtrend. Major long term resistances from the 200-week average, which capped the market in both 2015 and 2018, as well as the potential long term downtrend from 2014 are seen at 1.3117 and 1.3187/88 respectively, which are likely to prove very tough barriers to clear. Only below 1.2889 though would negate the potential for a bull “wedge” to turn our focus back lower within the range," CS adds. 

According to the report from GfK Group, сonsumer sentiment in Germany picked up again in November. Both economic and income expectations have seen a marked increase. Propensity to buy has remained at a very high level despite marginal losses. As a result, GfK has forecast a figure of 9.7 points for December, 0.1 index points higher than November's level (9.6 points). The index was expected to remain at 9.6. Known risk factors such as the global economic slowdown, trade conflicts and the chaos surrounding Brexit have resulted in a slight drop in the consumer climate when compared to the same period last year. Nevertheless, the indicator's level can still be described as highly satisfactory while propensity to buy remains stable. 

"The exceptionally high levels of consumer confidence among German consumers have significantly contributed to preventing a recession in Germany in the third quarter. Private consumption has thereby perfectly fulfilled its role as an important pillar of the economy," Rolf Bürkl, consumer expert at GfK explains. "Consumers are therefore optimistic about the upcoming holiday season, one of the busiest times of year for a number of retail industries such as consumer electronics and toys. How the year as a whole will be evaluated is determined during this period. And the retail sector can certainly look forward to this period with a healthy dose of optimism." 

EUR/USD

Resistance levels (open interest**, contracts)

$1.1153 (5263)

$1.1107 (3042)

$1.1068 (2109)

Price at time of writing this review: $1.1014

Support levels (open interest**, contracts):

$1.0982 (3541)

$1.0944 (2859)

$1.0898 (2386)

Comments:

- Overall open interest on the CALL options and PUT options with the expiration date December, 6 is 102324 contracts (according to data from November, 25) with the maximum number of contracts with strike price $1,1200 (5592);

GBP/USD

Resistance levels (open interest**, contracts)

$1.3004 (1568)

$1.2977 (2909)

$1.2957 (1080)

Price at time of writing this review: $1.2895

Support levels (open interest**, contracts):

$1.2835 (1245)

$1.2805 (116)

$1.2769 (2014)

Comments:

- Overall open interest on the CALL options with the expiration date December, 6 is 32222 contracts, with the maximum number of contracts with strike price $1,3000 (5633);

- Overall open interest on the PUT options with the expiration date December, 6 is 33163 contracts, with the maximum number of contracts with strike price $1,2200 (2280);

- The ratio of PUT/CALL was 1.03 versus 1.03 from the previous trading day according to data from November, 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.