TradeTheNews.com Weekly
Market Update: Collapsing oil prices worry markets awaiting Black Friday sales
data
Fri, 23 Nov 2018 13:02 PM EST
Equity investors had little to be thankful for in this year’s shortened
Thanksgiving week trade. Indices moved back towards the late Oct lows on
concerns about slowing global growth, Brexit and Italian budget disagreements,
and lasting China trade worries. Investors generally responded poorly to late
Q3 earnings season reports from the retailers who largely noted growing margins
pressures heading into holiday season. US Treasury yields slipped to the lowest
levels in more than a month helped by the risk off flows. WTI crude prices
careened toward $50 a barrel as global growth concerns and worries about
oversupply weighed on oil. For the week, the S&P500 dropped 3.8%, the DJIA
lost 4.4%, and the Nasdaq sagged 4.3%.
In corporate news this week, Apple and its suppliers’ shares were weighed upon
by reports that the tech giant recently cut production orders for three new
iPhone models due to lower-than-expected demand, and a separate report
indicating Apple’s largest assembler, Foxconn, planned on nearly $3B in cost
cuts amid warnings of anemic smartphone demand. As earnings season wraps up
before the US holidays, some key retailers announced results, with Target and
TJ Maxx seeing Q3 margins under pressure. Footlocker, however, beat
expectations and raised its Q4 comps outlook, and Kohl’s saw strength in
apparel. And as Black Friday kicked off, Macy’s CEO said in an interview that
he saw a ‘really strong start to the holiday shopping season’ with the caveat
of challenges arising from exceptionally strong Q4 comps last year. Nissan
removed its long-time CEO Carlos Ghosn following his arrest on suspicion of
financial misconduct in Japan. On Friday, Rockwell Collins shares spiked nearly
10% on word that China has approved its merger deal with United Technologies,
quashing fears that the deal could get entangled in the Sino-US trade squabble.
MONDAY 11/19
7201.JP Reportedly Chairman Ghosn to be arrested in Japan for alleged financial
trading violations - Japanese press
AAPL Reportedly has recently cut production orders for 3 new iPhone models due
to lower-than-expected demand - U.S. financial press
(US) NOV NAHB HOUSING MARKET INDEX: 60 V 67E (lowest reading since Aug 2016;
biggest drop since 2014)
TUESDAY 11/20
LOW Reports Q3 $1.04 v $0.97e, Rev $17.4B v $17.3Be
BBY Reports Q3 $0.93 v $0.85e, Rev $9.59B v $9.55Be
*(US) OCT HOUSING STARTS: 1.228M V 1.225ME; BUILDING PERMITS: 1.263M V 1.260ME
(US) Atlanta Fed cuts Q4 GDP forecast to 2.5% from 2.8% prior
GPS Reports Q3 $0.69 v $0.68e, Rev $4.09B v $3.98Be
WEDNESDAY 11/21
(US) Association of American Railroads weekly rail traffic report for week
ending Nov 17th: 546.5K, +0.04% y/y
(US) Atlanta Fed maintains Q4 GDP forecast at 2.5%
(US) DOE CRUDE: +4.9M V +2ME; GASOLINE: -1.3M V -0.5ME; DISTILLATE: -0.1M V
-2.5ME
(US) OCT EXISTING HOME SALES: 5.22M V 5.20ME
(US) OCT PRELIMINARY DURABLE GOODS ORDERS: -4.4% V -2.6%E; DURABLES
EX-TRANSPORTATION: 0.1% V 0.4%E
(CN) Reportedly adviser Peter Navarro will NOT be at the upcoming Trump Xi
meeting at the G20 - China press
(EU) EU Commission opinion on 2019 draft budget plans; confirms Italy budget is
seriously noncompliance with debt reduction commitment; excessive deficit
procedure warranted
TKA.DE Reports FY18 Net €60M* v €271M y/y, adj EBIT €1.6B v €1.64Be, Rev
€42.75B v €42.3Be
FRIDAY 11/23
(US) According to Adobe Analytics, Thanksgiving online spending valued at
$2.4B, +31.8% y/y - press
(DE) GERMANY Q3 FINAL GDP Q/Q: -0.2% V -0.2%E; Y/Y: 1.1% V 1.1%E
*(FR) FRANCE NOV PRELIMINARY MANUFACTURING PMI: 50.7 V 51.2E (26th month of
expansion but lowest since Sept 2016)
*(DE) GERMANY NOV PRELIMINARY MANUFACTURING PMI: 51.6 V 52.2E (47th month of
expansion but lowest since Mar 2016)
*(EU) EURO ZONE NOV PRELIMINARY MANUFACTURING PMI: 51.5 V 52.0E (64th month of
expansion and lowest since Mar 2016)
COL China gives conditional approval for United Technologies merger deal
*(US) NOV PRELIMINARY MARKIT MANUFACTURING PMI: 55.4 V 55.7E
(SA) OPEC and Saudis are reportedly mulling quiet oil output cuts; considering
stretching 2016 output limits into 2019 - press
