TradeTheNews.com Weekly
Market Update: Markets Feel Blip of Anxiety Amid Slow Progress on Policy Talks
Fri, 10 Nov 2017 16:08 PM EST
The week opened with stocks continuing to float up to all-time highs on low
volatility, but finished on a different note. The volume of corporate
announcements remained robust as the third quarter earnings season hit its
peak. By midweek a slew of stock and bond offering announcements appeared to
begin weighing on markets. The high-yield bond ETF broke through the 200-day
moving average, and that coincided with at 15% jump in the VIX volatility index
on Thursday. Global Treasury curves remained at some of its flattest levels in
about decade before yields lifted on Friday. The underlying risk currents
continued to be swayed by headlines from Washington and Brussels. More details
started to emerge on the Republican tax plan as it worked its way through Congress.
Word that a one-year delay in the implementation of the corporate rate cut to
20% was something being seriously considered seemed to cause some indigestion
in US stocks — small caps, in particular. There was no breakthrough in the
latest round of Brexit talks, as expected, but renewed reports that both sides
continue to prepare for a ‘no deal’ scenario may have also weighed on
sentiment. Crude remained one of the few bright spots as oil attracted money
flows on the lead-up to the November 30th OPEC meeting and continued fallout
from the Saudi crown price consolidating his power. US natural gas futures
climbed another 7%, helped by forecasts for the arrival of winter temperatures
across the Northeastern US. For the week the DJIA fell 0.5%, the S&P500 slipped
0.2%, and the Nasdaq lost 0.2%.
In corporate news this week, T-Mobile and Sprint formally ended long-running
merger discussions, as the two companies were ultimately unable to find
mutually agreeable terms. Qualcomm confirmed receipt of a $70/share merger
proposal from Broadcom, but reports suggested Qualcomm is poised to reject the
offer. CNBC reported that Disney recently held talks to acquire most of 21st
Century Fox and later added that, while the talks have paused, the two parties
have not given up on the idea of a deal. Disney earnings disappointed but
shares were lifted on news that the company intends to take on Netflix with a
lower-priced streaming service and that the company plans to produce a new Star
Wars trilogy. Macy's reported a miss on revenues, but earnings came in stronger
than anticipated on tighter inventory controls which boosted margins.
SUNDAY 11/5
S Softbank announces its intention to raise stake through open market
transactions or otherwise, subject to market conditions and other factors
TMUS T-Mobile and Sprint end Merger discussions
(UK) Reportedly UK govt has signaled that it is willing to pay the €60B (£53B)
Brexit divorce bill, meeting Brussels' demands - UK press
MONDAY 11/6
*(DE) GERMANY SEPT FACTORY ORDERS M/M: +1.0% V -1.1%E; Y/Y: 9.5% V 7.1%E
(CH) Swiss Oct CPI M/M: 0.1% v 0.1%e; Y/Y: 0.7% v 0.7%e
(EU) EURO ZONE NOV SENTIX INVESTOR CONFIDENCE: 34.0 V 31.0E (highest level
since July 2007)
FAST Reports Oct Rev $399.7M, +19.2% y/y
FOXA CNBC's Faber: Disney recently held talks to acquire most of 21st Century
Fox; price talks and deal structure can't be learned at this time
QCOM Confirms unsolicited merger proposal from Broadcom for $70/shr in cash and
stock valued at $130B with our without NXP
(US) NY Fed President Dudley (FOMC voter) to retire in mid-2018 (as speculated
over weekend)
CRM Forms new strategic partnership with Google
TUESDAY 11/7
(CN) CHINA OCT FOREIGN RESERVES: $3.1092T V $3.110TE (9th straight increase)
(CN) CHINA OCT TRADE BALANCE (CNY) 254.5B V 280.5BE
(CN) CHINA OCT TRADE BALANCE: $38.2B V $39.1BE
WEDNESDAY 11/8
ACA.FR Reports Q3 Net €1.07B v €1.03Be, Rev €4.58B v €4.76Be
RMS.FR Reports Q3 Rev €1.34B v €1.31Be
(PL) POLAND CENTRAL BANK (NBP) LEAVES BASE RATE UNCHANGED AT 1.50%; AS EXPECTED
AAPL Reportedly ramping up work on augmented reality headset with new chip and
op system - press
(US) Association of American Railroads weekly rail traffic report for week
ending Nov 4th: 538.7K carloads and intermodal units, -0.8% y/y
*(NZ) NEW ZEALAND CENTRAL BANK (RBNZ) LEAVES CASH RATE (OCR) UNCHANGED AT
1.75%; AS EXPECTED
(CN) China President Xi: Vast potential exists in China-US economic ties; China
willing to significantly raise imports from the US; US/China exploring long
term agreement on repatriation
THURSDAY 11/9
SIE.DE Reports Q4 Net €1.29B v €1.25Be, industrial business profit €2.20B v
€2.45Be, Rev €22.3B v €24.8Be;
DTE.DE Reports Q3 adj Net €1.24B v €1.15Be, adj EBITDA €7.32B v €5.33B y/y, Rev
€18.34B v €18.1B y/y
DPW.DE Reports Q3 Net €641M v €620Me, EBIT €834M v €755M y/y, Rev €14.6B v
€13.9B y/y
BRBY.UK Reports H1 adj Op £185M v £163.3Me, Rev £1.26B v £1.24Be; Announces
strategic update
AZN.UK Reports Q3 Core EPS $1.12 adj v $1.04e, Rev $6.23 v $6.0Be
*(PH) PHILIPPINES CENTRAL BANK (BSP) LEAVES OVERNIGHT BORROWING RATE UNCHANGED
AT 3.00%, AS EXPECTED
ODP Outlines vision to become IT Service co with MRR ahead of analyst day
M Reports Q3 $0.23 v $0.19e, Rev $5.28B v $5.32Be
(US) Senate tax bill reportedly to propose delaying corporate tax cut
implementation by one year to 2019 - press
HYG High yield ETF extends below 200-day moving average
*(MX) MEXICO CENTRAL BANK (BANXICO) LEAVES OVERNIGHT RATE UNCHANGED AT 7.00%;
AS EXPECTED
(UK) Ireland reportedly has made new demands in Brexit talks regarding the
northern border, surprising UK negotiators - UK press
DIS Reports Q4 $1.07 v $1.12e, Rev $12.8B v $13.1Be
NVDA Reports Q3 $1.33 v $0.94e, Rev $2.64B v $2.36Be; raises dividend to
$0.15/shr from $0.14 (indicated yield 0.29%)
NRG Withdraws planned $870M offering of 2028 senior unsecured notes on ‘broader
market conditions’; as a result to terminate cash tender for 6.625% senior
notes due 2023
FRIDAY 11/10
MT.NL Reports Q3 Net $1.21B v $680M y/y, EBITDA $1.92B v $1.88Be, Rev $17.64B v
$17.2Be
(FR) FRANCE SEPT INDUSTRIAL PRODUCTION M/M: 0.6% V 0.5%E; Y/Y: 3.2% V 3.1%E
*(UK) SEPT INDUSTRIAL PRODUCTION M/M: 0.7% V 0.3%E; Y/Y: 2.5% V 1.4%E
(UK) EU/UK officials Barnier and Davis hold press conference following the 6th
monthly round of Brexit negotiations
