Futures Fall Despite Solid EPS, Retail Sales Miss, Brexit Deal Remains Elusive

Futures Fall As Worries Creep  Back Into Focus

The U.S. equity market is indicated lower in early Wednesday trading despite signs 3rd quarter earnings are better than expected. The Dow Jones Industrial Average and S&P 500 are both indicated lower by 0.20% while the NASDAQ Composite is down about -0.30%. The move is driven by growing concern China will not follow through on its pledge to buy more U.S. agricultural products. If this is the case it is likely additional tariffs will be enforced later this year. China has pledged as part of the Phase I trade deal to buy up to $50 billion in U.S. products.

In earnings news, financial stocks Bank of America and Bank Of New York Mellon both reported better than expected EPS. Both companies reported strength in consumer segments that helped drive share prices higher. Shares of BAC are up more than 2.5% while BNY-Mellon is up about 1.5%. In economic news, Retail Sales were weaker than expected. September retail sales fell -0.3% versus an expected gain of 0.3%. The mitigating factor is an upward revision to the past month of 0.2%. Later in the session traders will have an eye out for the NAHB Index and the FOMC’s Beige Book.

Europe Mixed, Brexit Deal Is Still Elusive

European markets are flat and mixed at midday as traders fret over trade and the Brexit. On the trade front, China’s demands the U.S. remove the threat of more tariffs before signing the Phase I deal has thrown a wrench into the works. At this stage it is becoming less and less likely Phase I will come to fruition. In Brexit news, negotiations stalled on Wednesday despite a narrowing of differences. The Irish PM confirms the back-stop is yet to be resolved but there is hope. The two sides will begin a two-day summit tomorrow that will, hopefully, result in a deal.

The German DAX is in the lead at midday with a gain of 0.22% while the FTSE and CAC are both edging lower. In stock news, shares of UK tech giant Micro Focus is up 4.3% on its results as is seafood producer Mowi. At the other end of the rankings, IMCD and DBA Aviation are both down more than -4.0%.

Asia Mostly Higher On Brexit Hopes

Asian markets are mostly higher at the end of Wednesday’s session. The Nikkie and ASX are both up more than 1.0% while the Hang Seng and Kospi are up closer to 0.70%. The moves are driven by hope for a Brexit deal, however elusive it may seem right now. In Hong Kong, leader Carrie Lam is under intensifying pressure as she rejects HK’s bid for autonomy. The Shanghai composite is the only index to move lower, it posted a loss of -0.41%.

What is The Target of The Pound?

In less than a week, the British pound strengthened by 5% to the dollar and 4.3% against the euro to its highest levels in five months. The UK’s FTSE100 added 0.7% during the same period, and this week it is declining due to the strengthening of the national currency, although it rose in dollar terms by more than 4%. This performance better than the S&P500 growth by 3.5% over the same time.

Since last Thursday’s rally, GBPUSD has come a long way from near 1.22 and touched 1.28 last night. At the time of writing, the pound corrected to 1.2750, although the pair remains above the critical 200-day moving average line at 1.2710. It often acts as an essential trend indicator. Fixing the pound above this line at the end of this week will be a necessary signal for the markets to end the devaluation period.

The British pound sold out in July, declining below 1.20 in August and September, reflecting the maximum fear around chaotic exit of Britain from the EU. The appearance of significant signs of progress in the Irish border negotiations was a critical factor in the trend reversal.

If the EU and Britain agree deal on an exit on October 31 during Thursday and Friday summit, and the UK Parliament accepts it at the Saturday session, GBPUSD may quite quickly return to this year highs around 1.32.

The strengthening of the pound above its 200-day average in 2017 triggered a prolonged rally by 13% to 1.43. Fundamentally, the British currency in the coming months may get lift by both higher inflation rates and stronger economic indicators, which may be positively affected by the weakening of the British pound earlier. Without the uncertainty around Brexit, the Bank of England may well be more determined in its fight against inflation. Thus, the lows around 1.20 may well be a bottom for GBPUSD for the foreseeable future.

The EURGBP reached its peak near 0.93 in August, after which it turned sharply down, and now is trading by 7% below its peak levels at 0.8650. As the British and EU deal may have a positive impact not only on the pound but also on the euro, the potential for the weakening of EURGBP is noticeably lower – from 0.85 to 0.8350. Around 0.85, the pair consolidated from March to May, and on the way to 0.8350, it redeemed on the downturns in the period from August 2016 to May 2017, which makes these areas significant attraction points for the markets.

This article was written by FxPro

Futures Rise, Earnings Season Off To Shaky Start, Trade Concerns Dampen Investor Appetite

The U.S. Futures Are Rising In Early Trading

The U.S. indices are indicated higher in early trading as earnings season kicks off. Today’s news includes reports from more than a half-dozen important names and the results are mixed. The big banks are the main focus as JP Morgan, Goldman Sachs, Wells Fargo, and Citigroup all report. JP Morgan posted a nice beat on the top and bottom lines driven by strength in consumer lending. Citigroup, Goldman Sachs and Wells Fargo are all trading lower after reporting weaker than expected numbers.

In other news, United Health and Johnson & Johnson both beat expectations. Johnson & Johnson also reports strength in the consumer units while United Health upped its full-year guidance. Both stocks are moving higher by roughly 2.0%.

The Down Jones Industrial Average, S&P 500, and NASDAQ Composite are all up about 0.25% in early trading. The sentiment is buoyed by trade hopes but also tempered by caution. While China and the U.S. have signaled a Phase 1 deal is at hand there is still no deal in place. Until such time traders are cautioned to be prepared for negative headlines. On the economic front, the Empire State Manufacturing Survey rose modestly to 4 from last months 2.0 as production and employment edge higher.

European Markets Are Mixed, Hope For A Smooth Brexit Persist

European markets are mixed at midday on Tuesday after remarks from the EU’s Brexit team renewed hope. Michel Barnier said that despite the increasing difficulty it is still possible to reach a deal this week. The DAX and CAC are both up about 0.35% to 0.40% while the FTSE is down roughly -0.25%. Retail is in the lead with a gain of 0.90%.

In economic news, unemployment ticked higher in the UK. The 3rd quarter figure came in at 3.9%, a tenth higher than the previous. In stock news, shares of Hays are up 5.5% after it reported flat results. The good news is weakness in the UK was offset by strength in offshore markets. Share of Wirecard, however, are not so buoyant. The Financial Times did an expose on the company’s accounting practices and shares are down -17% because of it.

Asia Mixed, Trade Hopes Clash With Trade Fears

Asian markets are wildly mixed after Tuesday’s session. The Japanese Nikkei led the market with a gain of 1.9% after being closed Monday for holiday. Chinese indices are broadly lower following the release of inflation data. CPI rose 3% on a 69% increase in pork prices while PPI fell. The Shanghai Composite is down -0.56% on the news, the Hang Seng a more tepid -0.07%. Elsewhere in the region, the ASX and Kospi are both up mildly.

Guessing The Brexit Door

It is important to remember that the events around Brexit affect not only the British pound but also the euro, not to mention UK stock markets and shares around the world.

Today, October 15, EU ministers will meet in Luxembourg to discuss the latest changes to the deal proposed by the British Prime Minister and discussed with the Prime Minister of Ireland. At this level, the current agreement seems to be working and is unlikely to meet obstacles or negative responses. And that may become quite good news for the pound. But it will be harder in the future.

On October 16, the deal proposals wood need to be finalized before the crucial EU summit. A critical test is a meeting between Macron and Merkel, whose feedback may stall or give further impetus to the discussion. The pound and markets may have to survive a few hours in the background of heightened nervousness. At the EU summit on 17-18 October, Brexit’s discussion is likely to overshadow all issues, including defence, security and climate change. The most important question is whether the European Union will approve Britain’s proposals. Hints and comments from officials long before the final press conference may cause a strong market reaction.

If Brussels and London reach agreement, this new plan should also be approved by the UK Parliament. Prime Minister Johnson hopes that PMs will do this on the special session on a Saturday. Although the markets have met news on Brexit’s postponement very positively earlier, at this stage, the deal will drastically reduce uncertainty and could dramatically increase the purchase of British currency. In this case, Sterling could potentially return to the area above 1.32, where it was in March, from 1.2660 now.

Without the deal approval from the EU, or UK Parliament and MPs, Johnson will have to make an official request to the EU for another three-month postponement. First of all, it will be a return to uncertainty. Markets have a very negative perception of uncertainty so that the initial reaction could be a sell-off of the British currency.

However, there is also a greater chance that during the new deferral Brexit’s opponents may put on a vote an amendment requiring a public vote on the deal with the EU, or even a call for new general election. In the latter case, the chances of Britain’s exit from the EU are reducing, which may have a positive impact on the British currency and return the purchase of risky assets to the markets.

Formally, there is still a realistic chance that Britain may exit from the EU on October 31 without having a finalized deal. Analysts estimate the chances of such an outcome at 5-10%. This scenario could be a black swan for the British markets, like the unexpected outcome of the referendum in 2016. In this case, GBPUSD can decline below 1.20 very quickly, causing a shock wave in the markets.

This article was written by FxPro

Futures Fall As Uncertainty Grips The Market, Brexit Deal Elusive, China Trade Data Falls

The U.S. Futures Are Down In Early Trading

The U.S. futures are down in early trading despite positive developments on trade. The Dow Jones Industrial Average, NASDAQ Composite, and S&P 500 are all down about -0.55% in early trading. Tech is in the lead. The trade deal, announced on Friday, is an interim stop-gap measure intended to produce a three-phase solution. The first phase includes China increasing its purchases of agricultural products, a pledge the country has made several times in the past. In exchange, the U.S. will postpone or delay tariffs scheduled to take effect later this week.

While both sides have hailed the deal as good there is still no actual document and details are sketchy. China’s Vice Premier Liu He says he will be back to Washington this month to hammer out those details before President Xi will sign any deal. China is expected to purchase up to $50 billion in U.S. agriculture products with those purchases ramping up over the next few weeks. The timeline to end the trade war is now 15 months. Secretary of the Treasury Mnuchin says the October tariffs will go into effect in December if China reneges on its agreements.

In business news, this week begins the peak of 3rd quarter earnings. We are expecting reports from the big banks this week, they are expected to post EPS declines. In economic news, we are expecting several key reads from the Federal Reserve. Also on tap, Retail Sales, the Beige Book, Housing Starts, and the Index of Leading Indicators.

European Indices Are Down With A Case Of Uncertainty

EU indices are down at midday due to a growing case of uncertainty. The trade-deal that is not yet a deal remains a key point of uncertainty as does the Brexit. Brexit negotiators were unable to reach a deal over the weekend raising doubts a solution to the Irish-Backstop can be found. The Queen is expected to deliver her speech to open Parliament today. In it, she will outline the governments plans for Brexit.

The French CAC is leading decliners in early trading with a loss of -0.75% while the DAX and FTSE are both trailing with losses close to -0.50%. In stock news, shares of biopharma company Chr. Hansen rebound 3.8% after last week’s massive selloff.

Asian Markets Rebound Despite Trade Uncertainty

Asian markets are broadly higher after Monday’s session as trade hope fuels optimism. The Shanghai Composite and Korean Kospi both advanced more than 1.1% while the Hong Kong Hang Seng and Australian ASX gained 0.80% and 0.50%. Japan was closed for a holiday. In South Korea chipmakers Samsung and SK Hynix led the advance.

U.S. Stocks Turn Lower as Investors Sour on ‘Phase One’ Trade Deal

The major U.S. stock index futures turned lower for the pre-market session Monday morning and hedgers returned to the Treasury bonds, gold and Japanese Yen after China said it needed to have further discussions before it would sign off on the so-called phase one trade deal President Donald Trump announced on Friday.

The early market price action has the S&P 500 Index opening about 0.42% lower, the Dow off by 95 points or 0.35% and the NASDAQ Composite trading about 0.54% lower.

China Wants More Talks Before Signing ‘Phase One’ Deal

According to a Bloomberg report, China trade officials wanted more talks by the end of October to discuss details of the “phase one” trade deal.

This now has investors wondering if the additional tariffs originally scheduled to start on October 15, and suspended as of Friday, are back on. We’ll probably hear more about this from the Trump administration later in the session.

On Friday, President Trump announced that the first phase of a deal with China had been agreed, though officials on both sides said much more work needed to be done.

However, the deal that does not include many details and Trump has warned it could take up to five weeks to get a pact written. Furthermore, analysts are saying it appears to be more of a “temporary” than a real trade pact.

Investors took no chances upon hearing the news. Besides driving stocks lower and erasing some of Friday’s gains, hedgers drove December Treasury Notes 0.46% higher. December Comex gold futures rose 0.73% and the Japanese Yen jumped 0.24% higher. These protection moves are likely to increase if investors continue to turn sour on the deal.

Asian Markets Up, Europe Down

Shares in Asia rose in reaction to Friday’s partial trade deal news. Investors had no reaction to the Bloomberg report, which came out after the Asian markets had closed.

The major bourses in Europe turned lower after the report was released. According to CNBC, the pan-European Stoxx 600 slipped 1.1% during the morning trade, with basic resource stocks losing 2.6% to lead losses as all sectors traded in negative territory.

The Bloomberg report was not a complete surprise as Citi analysts pointed out in an earlier report.

“Despite what appears to have been achieved in the October talks, we remain cautious on an eventual trade deal,” the analysts wrote in a note. “The US offers are far from what China has been demanding, as showcased in its June State Council White Paper:  reasonable purchases of US imports, removal of existing tariffs, and giving the trade document a balanced treatment.”

In other news, customs data showed that China’s import and export figures were worse than expected in September, with exports falling 3.2% on the year in U.S. dollar terms, while imports declined 8.5%, according to Reuters.

The Week Ahead – Brexit, Earnings, Stats and the IMF and EU Summit in Focus

On the Macro

For the Dollar:

It’s a busier week ahead on the economic calendar.

NY Empire State Manufacturing figures for October get the week going on Tuesday. The focus will then shift to September retail sales figures due out on Wednesday.

With a heavy reliance on consumer spending, the numbers will need to be in line with forecasts to provide Dollar support.

On a busy Thursday, September building permit and housing start figures are due out along with October’s Philly FED Manufacturing numbers.

September industrial production and the weekly jobless claims figures are also due out.

With no material stats due out on Friday, Wednesday’s retail sales and Thursday’s Philly FED numbers will have the greatest impact.

Outside of the stats, trade war chatter will continue to be a factor, as will any further talk of impeachment.

The Dollar Spot Index ended the week down by 0.55% to $98.301.

For the EUR:

It’s also a relatively quiet week ahead on the economic data front.

Industrial production figures on Monday and German and Eurozone economic sentiment figures on Tuesday will influence early in the week.

The Eurozone’s September inflation and industrial production figures due out on Wednesday will also provide direction.

We would expect finalized inflation figures out of France and Italy to have a muted impact on the EUR, however.

With no material stats due out in the latter part of the week, geopolitical risk will remain in focus.

Any talk of U.S tariffs on EU goods and chatter on Brexit ahead of the 19th October EU Summit will also need considering.

The EUR/USD ended the week up by 0.58% to $1.1042.

For the Pound:

It’s another busy week ahead on the economic calendar.

Key stats include employment figures due out on Tuesday, inflation figures on Wednesday and retail sales numbers on Thursday.

On the data front, claimant counts, inflation and retail sales figures will be the key drivers in the week.

On the Brexit front, there would be more upside for the Pound should Johnson finalize a deal ahead of next weekend’s EU Summit.

The GBP/USD ended the week up by 2.73% to $1.2668.

For the Loonie:

It’s a relatively busy week ahead on the data front.

Key stats include September inflation figures due out on Wednesday and August manufacturing sales numbers due out on Thursday.

On the data front, we would expect the inflation figures to be the key driver in the week.

From elsewhere, trade data, industrial production and 3rd quarter GDP numbers out of China will also influence.

The Loonie ended the week up by 0.83% to C$1.3203 against the U.S Dollar.

Out of Asia

For the Aussie Dollar:

It’s another relatively quiet week ahead.

Key stats are limited to September’s employment numbers due out on Thursday.

On the monetary policy front, the RBA minutes are due out on Tuesday and could pressure the Aussie Dollar should there be suggestions of more rate cuts to come.

From elsewhere, economic data out of China on Monday and Friday will also influence.

The Aussie Dollar ended the week up by 0.34% to $0.6794.

For the Japanese Yen:

It’s a relatively quiet week ahead on the economic calendar.

Key stats are finalized industrial production figures due out on Tuesday and inflation and trade data on Friday.

We would expect the stats to have a relatively muted impact on the Yen, however.

Geopolitics and economic data out of the U.S and China will likely have the greatest impact in the week.

The Japanese Yen ended the week down by 1.26% to ¥108.29 against the U.S Dollar.

For the Kiwi Dollar:

Stats are on the quieter side in the week ahead.

Economic data is limited to 3rd quarter inflation figures that are due out on Wednesday. We can expect the Kiwi to be particularly sensitive to the numbers.

From elsewhere, stats from China will also influence in the week.

The Kiwi Dollar ended the week up by 0.27% to $0.6337.

Out of China:

It’s a busy week on the economic data front. Economic data includes trade data due out on Monday and inflation figures on Tuesday.

The focus will then shift to a busy Friday. Stats on Friday include fixed asset investment, industrial production and 3rd quarter GDP numbers.

We expect trade data, industrial production, and the GDP numbers to have the greatest impact on market risk sentiment.

The impact of any weak numbers could be buffered, however, by any further positive chatter on trade.

The Yuan ended the week up by 0.83% to CNY7.0892 against the Greenback.

Geo-Politics

Impeachment: With the U.S and China making progress on trade, impeachment chatter could return in the week ahead.

Trade Wars: 15th October U.S tariffs on Chinese goods have been postponed as progress was made last week. For real progress to be made, however, the U.S would need to remove existing tariffs that continue to hurt the Chinese economy. Expect more chatter in the week, which will influence risk sentiment.

UK Politics: Brexit talks continue, with a deal now needed to support further the Pound ahead of the EU Summit. Any suggestions that the latest proposal is inadequate and expect the Pound to slide.

The Rest

Earnings:  It’s a big week ahead, with U.S banks Citi, Goldman, JPMorgan, and Wells Fargo announcing.

EU Summit: It is make or break for Boris Johnson and the Brexiteers. Will there finally be an agreement for the British PM to take back to parliament?

IMF Annual Meeting: Chatter on the global economy and what can be done to drive growth will influence. Will there be any agreements to ramp up fiscal spending to offset the effects of the ongoing U.S – China trade war?

The Weekly Wrap – Progress on Brexit and Trade Delivered in the Week

The Stats

It was a quieter week on the economic calendar in the week ending 11th October.

A total of 44 stats were monitored throughout the week, following 74 stats from the week prior.

Of the 44 stats, 17 came in ahead forecasts, with 22 economic indicators coming up short of forecast. 5 stats were in line with forecasts in the week.

Looking at the numbers, 19 of the stats reflected an upward trend from previous figures. Of the remaining 25, 20 stats reflected a deterioration from previous.

While the economic data was skewed to the negative, the Dollar struggled in the week, as demand for the dollar eased off the back of positive updates from trade talks and Brexit.

The U.S Dollar Index (“DXY”) fell by 0.55% to end the week at $98.301.

Out of the U.S

It was a relatively quiet week on the economic data front. Wholesale inflation figures on Tuesday and September inflation figures on Thursday provided direction early in the week.

wholesale and consumer prices were on the softer side in September, pinning back the greenback.

On Friday, positive Michigan’s consumer expectations and sentiment figures failed to support the Greenback.

Off less influence in the week, were JOLTs job openings, initial jobless claims and import and export price index figures.

Outside of the stats, the FOMC meeting minutes revealed some debate on when to end the current rate path. Rising concerns over the economic outlook suggested that more cuts could be on the way.

The reality was, however, that just 7 of 17 FOMC members foresaw a further rate cut before the year-end.

Downside for the Dollar ultimately came from an easing in geopolitical risk, with most of the damage coming at the end of the week.

In the equity markets, a Friday rebound pulled the majors into the green for the week. The Dow and S&P500 ended the week up by 0.91% and 0.62% respectively, with the NASDAQ up 0.93%.

Out of the UK

It was a busy week on the economic calendar.

Key stats included GDP, industrial and manufacturing production and trade data on Thursday.

While production was on the slide, quarter-on-quarter GDP numbers continued to show the UK economy dodging a recession. The numbers were ultimately Pound positive.

Of less influence in the week were housing sector figures, labor productivity, and retail sales numbers.

While the stats were supportive of the Pound, the upside ultimately came from Brexit news.

Progress towards a possible trade deal, ahead of next week’s EU Summit, drove demand for the Pound.

The Pound ended the week up by 2.73% to $1.2668.

For the FTSE100, a stronger Pound failed to pressure the 100, with the index rising by 1.28%.

Out of the Eurozone

It was particularly quiet week on the economic data front.

Germany’s factory orders and trade data provided little support in the week, with factory orders falling again and the trade deficit narrowing.

On the positive, however, was an unexpected rise in industrial production.

At the end of the week, finalized September inflation figures out of Germany and Spain had a muted impact on the EUR.

On the monetary policy front, the ECB monetary policy meeting minutes also left the EUR unscathed.

The upside in the week ultimately came from positive updates on Brexit and progress on the U.S – China trade talks.

For the week, the EUR rose by 0.58% to $1.1042.

For the European major indexes, the DAX30 rallied by 4.15%, with the EuroStoxx600 and CAC40 up by 3.23% and 3.00% respectively.

Elsewhere

It was another positive week for the Aussie and Kiwi Dollars.

The Aussie Dollar rose by 0.34% to $0.6794, while the Kiwi Dollar gained 0.27% to $0.6337.

For the Aussie Dollar

It was a quiet week for the Aussie Dollar.

Economic data was limited to September’s business confidence and October consumer sentiment figures.

Both business and consumer confidence figures disappointed in the week, pinning back the Aussie Dollar.

Of less influence were home loan figures that continued to reflect improved housing sector conditions.

In spite of the negative bias on the stats, a Friday rally in the Aussie Dollar delivered the gains for the week. Positive updates on trade talks delivered the upside on the day.

For the Kiwi Dollar

The stats were, once more, skewed to the negative in the week.

September’s Business PMI held steady at 48.4, coming up short of a forecast of 49.0. Electronic card retail sales also came up short of forecasts, whilst up by 0.4% in September.

While the stats were skewed to the negative on Friday, a 0.27% gain on the day gave the Kiwi Dollar the upside for the week.

For the Loonie

Through the 1st half of the week, housing sector figures impressed, proving some support.

Employment figures on Friday were the key driver, however, with the unemployment rate falling from 5.7% to 5.5%. A 53k rise in employment, following an 81.1k increase in August, delivered on the day.

Positive updates from trade talks also delivered provided support late in the week, with WTI and Brent gaining 3.58% and 3.54% respectively.

The Loonie ended the week up by 0.83% to C$1.3203 against the Greenback.

For the Japanese Yen

It was a relatively quiet week on the data front. Stats were limited to August household spending figures that came in worse than forecasts.

While the stats were Yen negative, the downside from the Yen came from an easing in geopolitical risk.

Safe-haven demand waned as progress on Brexit negotiations and trade talks spurred demand for riskier assets.

For the week, the Japanese Yen fell by 1.26% to ¥108.29.

Out of China

It was a quiet week on the economic data front.

September’s service sector PMI, which reported slower sector growth, tested risk sentiment on Monday.

A lack of stats through the remainder of the week left updates from the U.S – China trade talks to influence risk sentiment.

The Yuan rose by 0.83% to CNY7.0892 against the Greenback.

U.S. Futures Strongly Higher, Hopes For Brexit Deal Stoked , China Announces Financial Reforms

The U.S. Futures Are Ripping Higher

The U.S. equities futures are ripping higher in early trading following positive news regarding trade. The Dow Jones Industrial Average, S&P 500, and NASDAQ Composite are all up more than 1.0% in early Friday trading. The spark that ignited this move is positive news on trade, news that suggests a temporary deal may be reached sometime today. Yesterday, a Tweet from Donald Trump that the talks were going “really well” was compounded today by another source who says the talks went “probably better than expected”.

Chinese Vice Premier Liu He is expected to meet with Donald Trump in the Oval Office later today. During the previous negotiations session, such a meeting preceded important concession from both sides. In stock news, shares of FAANG stocks are up more than 1.0% while the financials are close behind. Investors are also closely watching earnings. Next week the big banks are slated to report and open peak earnings season.

Europe Higher, Brexit Deal In Sight

European markets are also moving higher in early trading. The DAX is up about 2.0% while the CAC trails with a gain of 1.0% and the FTSE lags at 0.60% In Brexit news, Irish PM Leo Varadkar said a deal might be clenched by the deadline after a meeting with UK PM Boris Johnson. The two are trying to work out a solution to the Irish-Backstop, it appears they have hit on a promising possibility. JP Morgan, in the wake of this news, raised their odds of a smooth Brexit from 5% to 50%.

In stock news, tech is in the lead at midday with a gain greater than 3.0%. At the other end of the spectrum, shares of ad-company Publicis are down -13% after cutting full-year guidance. Energy is also a strong performer in the early part of today’s session. Brent and WTI are both up nearly 2.0% after Iran reported one of its tankers was struck by missiles. The tanker was traveling close to Saudi shores, the Saudis have not made a comment but it is possible they are retaliating for damage done last month.

Asian Markets Move Higher

Asian markets closed higher on rising trade hopes. The Hong Kong Hang Seng led the day in Friday’s session with a gain of 2.34%. The move was boosted by a 4.5% increase in CNOOC, China’s national oil company. The Nikkei is in the runner-up position with a gain of 1.15% while most others in the region advanced 0.80% to 0.90%. In China, China’s financial regulator has laid out a timeline reducing and removing requirements for foreign financial institutions.

Trade Deal Optimism, Brexit Breakthrough Boost European Indexes

Strong stock market performances in the U.S. on Thursday and in Asia early Friday carried over to the European session with its major indexes posting solid gains. The catalysts behind the strength are optimism over U.S.-China trade negotiations with investors hoping for at least a partial deal between the two economic powerhouses and positive developments over Brexit.

At 09:47 GMT, the UK’s FTSE is at 7201.55, up 15.19 or +0.21%. Germany’s DAX is trading 12388.55, up 224.35 or +1.84 and France’s CAC is at 5631.71, up 62.66 or 1.13%.

US-China Relations

Besides the carryover strength from the U.S. and Asia, European shares were boosted by comments from President Trump, who characterized high-level trade discussions between the U.S. and China as “very, very good” and plans to meet with Chinese Vice Premier Liu He at the White House on Friday.

On the back of that comment, Alex Wong, director of asset management at Ample Capital, told CNBC’s “Street Signs” on Friday, “The best scenario probably would be just a partial deal, I think.”

Wong furthered added, “I don’t think we (will) see a very strong outcome today.”

Past meetings between Liu and Trump this year have yielded positive progress on trade. For example, after their meeting in January, China increased its soybean buying. And their February meeting resulted in a delay in tariffs.

Positive Developments over Brexit

European shares were also underpinned after positive comments on Brexit from the leaders of the Republic of Ireland and the U.K.

U.K. Prime Minister Boris Johnson met with his Irish counterpart Leo Varadkar for further Brexit talks Thursday afternoon, with subsequent comments encouraging investors to buy shares.

“The Prime Minister (Johnson) and Taoiseach (Varadkar) have a detailed and constructive discussion,” the joint statement said.

“Both continue to believe that a deal is in everybody’s interest. They agreed that they could see a pathway to a possible deal.”

Additionally, Irish Prime Minister Leo Varadkar said a Brexit deal could be clinched by the end of October to allow the U.K. to exit the European Union in and orderly manner.

U.K. Brexit secretary Stephen Barclay is in talks with the EU’s chief Brexit negotiator Michel Barnier on Friday.

Finally, J.P. Morgan said Friday it had lifted its outlook for the chances of a Brexit deal from 5% to 50%.

Futures Fall After Wild Session, EU Flat On Brexit Angst, Asia Rebounds On Trade Hope

The U.S. Futures Are Down After A Volatile Session

The U.S. futures are down after a wild overnight session. The Dow Jones was indicated up by triple digits after an initial report raised hopes for a trade deal. Later in the session, following a string of reports out of China, hopes faded as trade talks are seen stalling. The initial report is that President Trump would allow sales of non-sensitive equipment to Huawei. The later reports say talks have stalled due to a lack of progress. China won’t budge on forced technology transfers and demands the U.S. reverse a decision to blacklist 28 companies earlier this week.

Trade talks are still slated for today in Washington but it is unclear if progress will be made. Vice Premier Liu He is now expected to leave a day early. The Dow Jones Industrial Average is down about -0.20% while the S&P 500 and NASDAQ Composite are both down about -0.15%.

In economic news, the U.S. consumer price index was unchanged over the last month. Economists had been expecting a gain of 0.1%. This news ups the chances for an October rate cut but do little to alter the general outlook. The U.S. economy is still on solid footing.

European Markets Are Flat At Midday

The EU markets are flat and mixed at midday as Brexit angst and trade concerns weigh on sentiment. In Brexit news, negotiations have been delayed by a day and are expected to restart on Friday. The EU has told the UK that significant concessions must be made if there is to be a new deal before the October 31 deadline. The DAX and FTSE are both trading near 0.0% while the CAC is up about 0.25%.

In economic news, UK GDP came in at 0.3% in the last month versus an expected 0.2%. This news, along with a 0.1% upward revision to the previous month, greatly reduces the odds of a 3rd quarter recession. In stock news, shares of biosciences firm Chr. Hansen fell -13% after missing earnings estimates.

Asian Equities Rebound On Trade Hopes

Asian equities rebound on news the U.S. would ease restrictions on Huawei. The major indices closed with gains in the range of 0.0% to 0.78% and closed before reports that sent U.S. markets plunging. The only index to shed value in today’s session is the Korean Kospi, it fell nearly -0.90%. Trading in Korea was impacted by a -2.32% decline in Hyundai Motors. In Japan, factory orders fell for the 2nd month and threaten to extend a manufacturing recession in the country.

Futures Surge, China May Accept Interim Trade Deal, Don’t Expect The Trade War To End

The U.S Futures Are Up Sharply In Early Trading

The U.S. futures are up sharply in early trading. Reports from China suggest an interim trade-deal may be at hand. According to separate reports citing an unnamed official China is prepared to accept a partial deal. Their terms are if the U.S does not impose any more tariffs. The reports go on to say China will concede non-core issues but won’t budge on major sticking points.

Chinese officials are said to have “no optimism” regarding a broad trade deal or an end to the trade war. At best, traders can expect a new status quo to be put in place and for economic slowness while businesses adjust. The key takeaway is, however, that a measure of uncertainty may be removed from the market allowing economic expansion to resume.

The NASDAQ Composite is in the lead with a gain of 1.0% in early trading. Shares of Apple’s supply chain are, however, mixed in the premarket session. The S&P 500 is in second place with an advance of 0.90% while the Dow Jones Industrials are up about 0.75%. Later in the session traders will be on the lookout for the JOLTs report and Wholesale Trade at 10 AM.

Europe Up, Brexit Deal Is Still Elusive

European markets are up on trade hope despite the elusiveness of a satisfactory Brexit deal. In the latest news, PM Boris Johnson is facing mutiny from within his own party as the odds of a hard-Brexit increase. An offer from the EU to allow associated parties to exit the Irish-Backstop after a few years was rejected. The rejection by Northern Ireland is understandable but adds to frustrations. Both Johnson and his Irish counterpart have reiterated their desire for a deal.

In stock new, shares of GVC are up nearly 5% after the company increased its earnings guidance for the second time in three months. In other news, markets are expecting another rate cut from the FOMC after a speech by Jerome Powell on Tuesday. Powell says the Fed is prepared to act as necessary and may begin increasing the balance sheet again soon.

Asia Mixed Amid Growing Trade Uncertainty

Asian markets closed the day mixed because the session ended before the reports of China accepting an interim deal hit the wires. Traders in the region are concerned trade relations will not improve due to the U.S. blacklisting of 28 more companies and visa restrictions on official envoys. The U.S. move is in response to China’s alleged human rights violations targeting ethnic Muslims. This move is a counterpoint to China’s harsh backlash against the NBA for supporting the protests in Hong Kong.

The Nikkei is down about -0.60% on weakness in Tencent. The Shanghai advanced 0.39%. The Hang Seng shed -0.81% while the ASX fell -0.71%. The Korean Kospi led today’s session with a gain of 1.21%.

U.S. Markets Fall, Hopes For A Trade Deal Fade, BREXIT Talks Close To Failure

The U.S. Futures Moves Lower In Early Trading

The U.S. futures are moving lower in early Tuesday trading after a series of events led traders to believe U.S./China trade negotiations are going nowhere. On the U.S. side of the equation, the White House has expanded its blacklist of Chinese companies by 28. The move is intended to help protect Chinese Muslim minorities that are being persecuted in the country. On the Chinese side of the equation, China’s Sout China Morning Post reports that government officials have toned down their expectations for a deal. Further, Chinese representative Vice Premier Liu He will not carry the Special Envoy title signifying his official status in the talks.

The Dow Jones Industrial Average is in the lead with a loss near -0.29% while the S&P 500 and NASDAQ Composite are close behind. In economic news, September PPI was much weaker than expected and ups the odds for an FOMC rate hike this month. Headline PPI fell by -0.3% during the month leaving the YOY gain at only 2.0%. 2.0% is the Fed’s target rate but with the pace slowing, it is clear the economy is slowing. At the core level, PPI also fell -0.3%.

European Markets Fall As BREXIT News Fails To Soothe Frayed Nerves

European markets are also moving lower on Tuesday due to the downturn in trade hopes. The sentiment was further soured by news the BREXIT talks were close to breaking down. An expectation a solution to the Irish-Backstop had developed over the weekend but that is now dashed. With the BREXIT only three weeks away it is becoming increasingly likely there will not be a smooth transition.

The DAX is in the lead in early trading posting a loss of -1.05% despite better than expected IP numbers. Industrial Production in the EU’s largest economy rose 0.3% versus an expectation of 0.1%. The news suggests that Germany’s broader economy may avoid recession but concerns over slowing remain. The French CAC is also down about -1.05% while the UK FTSE 100 is trailing at -.035%.

Asian Markets Are Broadly Higher

Asian markets are broadly higher despite signs a trade deal between China and the U.S. will remain elusive. The Nikkei leads with a gain of 0.99% while most others advanced 0.25% to 0.45%. Analysts at JP Morgan are certain no deal will be made other than maintaining the current status quo. It is possible Trump will delay or suspend tariffs set to take effect next week but traders are cautioned not to put much hope in that outlook.

Futures Fall In Early Trading, Brexit Deal Is In Focus, Trade Talks To Take Place This Week

The U.S. Market Moves Lower

The U.S. market is moving lower in early Monday trading as caution takes center stage. Traders will be watching a number of key economic releases as well as trade talks slated for Washington D.C. The Dow Jones Industrial Average, the S&P 500, and NASDAQ Composite are all down about -0.25% in the premarket session. The industrial stocks are in the lead, the XLI Industrial SPDR is down about -0.50%.

In economic news, this week’s calendar will bring us CPI and PPI as well as the JOLTs report and FOMC minutes. On the inflation front, traders will be looking for signs of clarity regarding the Fed. The Fed is expected to cut rates later this month but the outlook is cloudy. While activity is slowing and inflation is running cool, the labor markets are still strong. The NFP data reveals underlying strength in the U.S. The FOMC may cut rates one more time before the end of the year but the odds for two are well below 50%.

In trade news, deputy-level talks will be held in Washington this week. China is sending Vice Premier Liu He who has already said China will not agree to the broad reforms President Trump is asking for.

Brexit Deal In Focus, Expect Big News By The End Of The Week

EU markets are slightly higher in early Monday trading as hopes for a smooth Brexit intensify. The UK FTES is in the lead at midday but the gain is small, only about 0.25%, while the DAX and CAC are close behind. In Brexit news, UK PM Boris Johnson’s solution to the Irish-Backstop was met with some optimism. While there is no indication it will be accepted leaders in the EU have embraced it with an open mind. France’s Macron says the EU Council will make its decision by the end of the week.

In economic news, German Industrial Orders fell again and more than expected. The news is the latest indication the German manufacturing recession will continue for another month. On the consumer front, Sentix Consumer Sentiment fell to -16.8 from -11.1 as trade woes and economic slowdown drag on outlook. In stock news, shares of HSBC moved higher after the company said it would cut up to 10,000 jobs in an effort to control costs.

Asia Mixed, Trade Is In Focus

Asia markets are mixed after Monday’s session. The Chinese and Hong Kong markets are still closed for holidays. The session was led by Korea and Australia which gained close to 1.0% and 0.70%. Japan trailed with a loss of -0.16%. Investors are hopeful an interim deal will be reached between the U.S. and China. One trader put the odds at 40% for an interim deal and 60% for the October 31st tariffs to be delayed.

Weekly Wrap – A Heavy Economic Calendar Tested the Market Bulls

The Stats

It was a particularly busy week on the economic calendar in the week ending 4th October.

A total of 74 stats were monitored throughout the week, compared with 44 in the week prior.

Of the 74 stats, 24 came in ahead forecasts, with 41 economic indicators coming up short of forecast. 9 stats were in line with forecasts in the week.

Looking at the numbers, just 24 of the stats reflected an upward trend from previous figures. Of the remaining 50, 43 stats reflected a deterioration from previous.

With the economic data was skewed to the negative, the Dollar struggled in the week, as NFP and private sector PMI numbers missed the mark.

The U.S Dollar Index (“DXY”) fell by 0.27% to end the week at $98.840.

Out of the U.S

It was a busy week. September Chicago PMI figures kicked the week off. Particularly weak numbers had a relatively muted impact on Monday ahead of ISM PMI numbers later in the week.

Following some particularly dire manufacturing PMIs from the Eurozone, U.S manufacturing PMIs weighed on Tuesday.

An acceleration in the pace of contraction in the U.S manufacturing sector sent the markets into risk-off mode. The ISM Manufacturing PMI fell from 49.10 to 47.8 in September.

ADP nonfarm payroll numbers on Wednesday failed to shift sentiment. According to the ADP, nonfarm payrolls rose by just 135K in September, falling short of a forecasted 140k. A downward revision to August numbers didn’t help.

ISM non-manufacturing PMI numbers on Thursday also intensified risk aversion. The PMI fell from 56.4 to 52.6. As a key contributor to the U.S economy, a slide in the new orders sub-index from 60.3 to 53.7 was key to the Dollar demise.

Following dire manufacturing numbers earlier in the week, factory orders also influenced on Thursday. August’s orders fell by 0.1%, which was better than a forecasted 0.2%. Orders had risen by 1.4% in July…

If the markets were looking for some support, Friday’s nonfarm payroll and wage growth numbers failed to deliver.

Wage growth slowed from 3.2% to 2.9%, year-on-year, with only 136k nonfarm payroll jobs added. Economists had forecast an increase of 145k.

A fall in the U.S unemployment rate from 3.7% to 3.5% supporting risk appetite on the day.

The Dollar may have been the safe haven of choice, but weak stats and sentiment towards the U.S economy ultimately sank the Greenback in the week.

In the equity markets, it was a mixed week for the U.S majors. The Dow and S&P500 ended the week in the red for a 3rd consecutive week, while the NASDAQ gained 0.54%. The S&P500 and Dow fell by 0.92% and 0.33% respectively.

Out of the UK

It was also a busy week on the economic calendar.

Economic data included 3rd estimate 2nd quarter GPD numbers on Monday and private sector PMIs through the week.

While the UK economy contracted in the 2nd quarter, of greater concern was an accelerated contraction in the UK services and construction sectors.

The only good bit of news for the UK economy was a  slower pace of contraction in the manufacturing sector.

While the numbers were on the slide, however, UK politics and Brexit chatter were the key drivers.

The Pound ended the week up by 0.32% to $1.2331.

For the FTSE100, a stronger Pound added pressure on the 100, with the index falling by 3.65%.

Out of the Eurozone

It was a particularly busy week on the economic data front.

On Monday, Germany was in focus, with retail sales, unemployment and inflation figures providing direction.

It was a hopeful start to the week, with retail sales rising by 0.5% and unemployment falling by 10k.

Even the Eurozone’s unemployment rate fell from 7.5% to 7.4%.

Softer prelim inflation figures for September raised an early red flag, however.

On Tuesday, manufacturing PMIs hit risk sentiment. There was nothing positive in the numbers ultimately weighing on risk sentiment through to the service PMI numbers on Thursday.

A light economic calendar on Wednesday had little influence ahead of another slew of disappointing economic data on Thursday.

Service sector PMI and composites fell further, with Germany’s private sector sitting at the bottom of the Eurozone table.

The only positive on Thursday was a 0.3% monthly rise in the Eurozone’s retail sales.

While the numbers were dire in the week, U.S stats were even worse, ultimately giving the EUR support.

For the week, the EUR rose by 0.35% to $1.0978.

For the European major indexes, the DAX30 slid by 2.97%, with the EuroStoxx600 and CAC40 down by 2.95% and 2.70% respectively.

Elsewhere

It was a steadier week for the Aussie and Kiwi Dollars.

The Aussie Dollar rose by 0.10% to $0.6771, while the Kiwi Dollar gained 0.38% to $0.6320.

For the Aussie Dollar

It was a relatively busy week for the Aussie Dollar.

On the economic data front, private sector credit, trade data, and building approvals were negative ahead of retail sales figures on Friday.

Retail sales rose by 0.4%, month-on-month, in August. While falling short of a forecasted 0.5% rise, a rebound from a 0.1% fall in July eased the pain.

While the numbers skewed to the negative, a hawkish RBI rate cut delivered support on Tuesday.

The direction in the week ultimately boiled down to sentiment towards monetary policy divergence. Dire stats out of the U.S suggested that the FED may need to ramp up easing in the coming months.

For the Kiwi Dollar

The stats were skewed to the negative in the week. Business confidence weakened in the 3rd quarter and in September. Weaker confidence came in spite of RBNZ rate cuts, raising concerns over business investment near term.

Negative sentiment towards global trade weighed on business sentiment.

In spite of the negative numbers, however, upside came from the weak stats from the U.S.

For the Loonie

Stats included RMPI and GDP numbers in the first half of the week. Negative numbers failed to sink the Loonie, however, with economic data from the U.S offsetting the weak numbers.

At the end of the week, trade data and September’s Ivey PMI delivered mixed results. Whilst the trade deficit narrowed in August, Canada’s Ivey PMI slid from 60.6 to 48.7 in August.

The Loonie ended the week down by 0.51% to C$1.3314 against the Greenback, with sliding oil prices ultimately weighing.

For the Japanese Yen

It was a mixed start to the week. While August industrial production tumbled, retail sales bounced back in August.

Better than expected retail sales figures were unlikely to shift the BoJ’s planned monetary policy moves, however.

Sales tax hikes likely contributed to the August spike.

On Tuesday, a particularly busy day saw the Tankan numbers reflect weaker conditions in the manufacturing and services sectors.

The numbers may have been better than forecast, but weakness ultimately supported the BoJ’s anticipated easing.

On Thursday, the service sector PMI’s added to the market angst late in the week.

Risk aversion ultimately prevailed in the week, giving the Yen the upside against the Greenback.

For the week, the Japanese Yen rose by 0.91% to ¥106.94.

Out of China

It was a busy Monday ahead of a week-long holiday.

Key stats on Monday included September private sector PMI numbers.

Better than forecasted numbers provided support to the markets in the early part of the week before risk aversion took hold.

While the NBS non-manufacturing sector PMI slipped from 53.8 to 53.7, it was positive for the manufacturing sector PMIs.

The NBS manufacturing PMI rose from 49.5 to 49.8, with the Caixin manufacturing PMI rising from 50.4 to 51.4.

It may have been a positive for the numbers, but news of the U.S planning to pin back investments into China weighed.

The Yuan fell by 0.36% to CNY7.1483 against the Greenback.

Strong Data Lifts U.S. Stocks, Global Markets Mixed, Rates Cuts In Focus

Strong NFP Data Lifts U.S. Stocks

Some strong labor data has the U.S. market moving higher in early trading. The futures had been down but better than expected unemployment figures and solid jobs gains reversed sentiment. The Dow Jones Industrial Average, S&P 500, and NASDAQ Composite had all been down marginally but are now up about 0.20%.

The NFP data shows 136,000 new jobs were added in September, analysts had been expecting a number closer to 145,000. Within the report, unemployment fell -0.2% to a 50-year low and the labor force participation rate increased showing new workers are finding jobs faster than they are entering the market. Average hourly earnings fell by a penny which is a concern but this is offset by the 2.9% YOY gain. With more and more younger workers entering the labor force it is possible the average earnings could tick lower.

The NFP data is especially important because of the FOMC and rate-cutting outlook. The poor ISM readings from earlier this week increased the odds of future rate cuts, this new data does not support that outlook. The CME’s FedWatch Tool now shows about an 80% chance of a cut at the next meeting.

EU Markets Are Flat In Early Trading

The EU markets are flat in early trading as global growth worries, central bank outlook, and Brexit drama weigh on sentiment. In local news, UK PM Boris Johnson continues to face intense pressure at home but there appears to be a ray of light regarding his Brexit plan. European Council President Donald Tusk says he is open to Johnson’s Irish-Backstop solution but not convinced. Regardless, it is the first and only sign that Theresa May’s Brexit deal can be renegotiated.

The DAX is trailing in today’s market and hugging the flat line. The French CAC is up about 0.20% while the UK FTSE is in the lead with a gain near 0.30%. In stock news, shares of BP are up about 1.0% after it announced its CEO would be stepping down.

Asian Markets Mixed, Hong Kong Protests Escalate

Asian markets are mixed on Friday after an escalation of protests in Hong Kong. The protests have reached a level forcing HK’s leader to enforce martial law and ban face masks within the city-state. Shares of Hong Kong-listed stocks led the rout with a loss of -1.10% while most others traded closer to break even. The Korea Kospi is the only other to fall in Friday trading losing -0.55%. The ASX and Nikkei are both up about 0.35%.

U.S. To Impose Tariffs On The EU, EU PMI Falls, Asian Markets Dive On Global Growth Fears

The U.S. Futures Are Down In Early Thursday Trading

The U.S. futures are indicating a lower open in early Thursday trading. The move is driven by a souring outlook for global economic growth. This week’s U.S. Manufacturing PMI and an untimely ruling from the WTO threaten to plunge the world into recession.

The WTO ruled in favor of the U.S. regarding EU subsidies for Airbus and has given the green light on up to $7.5 billion in annual tariffs. The Dow Jones Industrial Average, S&P 500, and NASDAQ Composite had all been higher in the earliest hours of Thursday trading but gave up those gains to trade just shy of break-even.

U.S. tariffs on EU goods will go into effect on October 18. Tariffs will be on Airbus aircraft, the root of the issue, as well as some whiskeys and cheeses among other items. The ruling concludes years of litigation but may not settle the long-running dispute. The EU has already threatened it may retaliate and up the stakes in the global trade war. Later today, traders will be looking out for the ISM Services PMI for any signs of weakness. Tomorrow the NFP will be front and center in traders’ focus.

In stock news, shares of Tesla are moving lower in early trading. The company reported a net increase in deliveries for the period but failed to match expectations. Shares are down -5.0%. Constellation Brands is down -4.0% after it reported weaker than expected 3rd quarter results.

EU Markets Are Mixed

The EU markets are volatile and mixed at midday on Thursday as traders seek certainty in an uncertain world. The DAX is trading near break-even while the FTSE is down about -0.90% and the CAC is up about 0.35%. Signs of global slowing are weighing on sentiment and those signs are not limited to the U.S. Today’s EU composite PMI came in at 50.1 showing very little expansion within the broad economy. Within that, PMI from Germany and France were also weaker than expected. Services was also weak falling near 2 points to 51.6.

Asian Plunges On Global Slowdown

Asian markets are down hard on weakening global economic activity. China, Hong Kong and South Korea were closed for holidays leaving the Nikkei and ASK the only major indices open for trading. Both those markets shed more than -2.0% on fear U.S. tariffs on EU goods will plunge the world in to the long-feared recession. Traders should be cautioned that the data, while weak, is still positive. There is no recession at hand just yet. When it comes, if it comes, the market is likely to already have corrected.

Weak Data Slams Stocks, Johnson-Backed Brexit Deal To Be Rejected, U.S./China Trade Talks Are Next Week

The U.S. Indices Are Down On Weak Data

The U.S. futures are down in early trading as weak data slams the market. Yesterday’s ISM Manufacturing data set the stage for possible U.S. recession. Today’s ADP confirms a general slow-down in the labor markets. Traders are cautioned not to read too much into the data, manufacturing is only 10% of the entire U.S. economy and labor markets remain healthy. The Dow Jones Industrial Average, S&P 500 and NASDAQ Composite are all down about -0.45% in the premarket session.

In stock news, shares of FAANG stocks are down -0.75% to -1.0% while Caterpillar and Union Pacific are both down slightly more than -1.0%. In economic news, on Tuesday the ISM Manufacturing data showed U.S. manufacturing contracted and at a 10 year low. Headline ISM came in at 47.8 with the employment component edging down 1.1% to 46.3. In today’s news, the ADP Employment data shows U.S. job gains are steady but not robust. ADP came in at 135,000 versus an expectation for 150,000. The September ADP figure was revised lower to 157,000, regardless the figure job creation is positive and labor markets remain tight.

EU Markets Slammed By Politics And Economics

The EU markets are down hard at midday on Wednesday after a round of weak data and less-than-positive news on the Brexit front. In economics, the U.S. manufacturing data is a sign that current trade policies and the uncertainty around them is hurting business. German GDP estimates were revised lower today, to 1.1% from 1.8%, and the same is likely in the U.S. as well. The caveat for traders is that, while GDP estimates are in decline they are still positive.

The German DAX is down about -1.35% at midday with the CAX a little lower with a loss near -1.75%. The UK FTSE is in the lead with a decline of -2.25% driven by mounting certainty there will be a hard-Brexit. PM Boris Johnson is expected to deliver his proposal for a clean Brexit today. The bad news is the EU is expected to reject it if presented in the form leaked to the press.

In stock news, shares of Grenke are up more than 6% after reporting its 9-month update. Shares of Carl Zeiss Meditec are up 4.4% after the company raised guidance.

Asia Moves Lower, Recession Fears Grip The Market

Most Asian markets shed a  minimum of -.05% in Wednesday trading. The Korean Kospi led the losses with a decline of -1.95% followed by the ASX -1.50%. Japan shed only -0.50%. China and Hong Kong are closed. The focus is on data from around the world. The latest from the U.S., that reveals slowing in the global economy. Hopes are pinned to trade talks that are expected to resume next week. No deal is expected but there may be a positive development, we’ll see.

Futures Edge Higher, Weak Data Weighs On EU, RBA Cuts Rates To Record Low

The U.S. Futures Are Edging Higher

The U.S. futures are inching higher on Tuesday as trade hopes prop up expectations for future growth. While no deal is expected, the U.S. and China are planning to hold trade talks next week. Both sides are believed to need and want a deal, the questions are how long it will take to reach one and what it will look like when it is.  Along with this, traders are waiting on a ruling from the WTO that will open the door for U.S. tariffs on EU goods. The WTO is expected to rule that EU subsidies to aircraft manufacturers are unfair and hurt U.S. businesses.

The Dow Jones Industrial Average is up 0.28% in early trading while the NASDAQ and S&P 500 are up 0.23% and 0.18% respectively. In economic news, traders are waiting on manufacturing PMI and construction spending due out later today. Later this week focus will be on the labor data including ADP on Wednesday and NFP on Friday. Also on tap, today are a number of Fed speeches including one from James Bullard.

EU Markets Falter On Weak PMI Data

The EU markets are edging lower in early Tuesday trading after a round of weak PMI data from the region. The CAC, DAX, and FTSE are all down about -0.12% at midday. Official EU manufacturing PMI shows the bloc’s activity continues to contract. The final read came in at 45.7, a tenth better than the flash reading but still a seven-year low. Germany led the contraction with a PMI reading of 41.7.

In political news, UK PM Boris Johnson continues to defend his plan for a new Brexit deal among growing criticism. Johnson is speaking before a conference of his ruling Conservative party this week. In stock news, plumbing giant Fergusson saw its shares surge more than 3.4% after it reported better than expected results.

Asia Moves Higher, China Closed For Holiday

Asia-Pacific stocks moved higher after the RBA cut its rate to a record low. The RBA cut interest rates by 25 bps to 0.75% and levels never before seen in the Land Down Under. According to remarks made by RBA officials after the release, we can expect rates to remain low for an extended period of time. There is also a chance for future cuts to even lower levels. The ASX led Tuesday’s gains with an advance of 0.81% while the Nikkei and Kospi both rose about 0.45%. Mainland Chinese and Hong Kong markets are closed today for the 70th anniversary of the foundation of the People’s Republic of China celebrations.

Futures Edge Higher, Global Markets Mixed, Trade Uncertainty Reaches New Highs

The U.S. Futures Are Edging Higher In Early Monday Trading

The U.S. futures market is indicating a higher open for the major indexes on Monday morning. The moves are small but show some optimism after a weekend of conflicting news. Reports the White House would move to block investment into Chinese companies was later countered by an official statement that no, the White House was not considering such a move. This morning, trade advisor Peter Navarro called the early reports “fake news”. The Dow Jones Industrial Average is up about 0.25% in early trading, the S&P 500 is a notch higher at 0.30% and the NASDAQ Composite is in the lead with a gain of 0.45%.

In stock news, Thor Industries missed revenue estimates but delivered a whopping beat on the bottom line. The company reports EPS of $1.67 beats by $0.27 due to strengths in the U.S. and EU RV markets. Egg producer Cal-Maine says egg revenue rose 1.7% in the fiscal first quarter but still fell shy of estimates. Despite the miss, the company reports better than expected EPS but shares are down -4.5% anyway. On the economic front, this week is the end of the month which means the monthly labor data is due out. This will include ADP, Challenger, and the Non-Farm Payrolls report.

EU Markets Are Flat And Mixed, Trade Is In Focus

The EU markets are flat and mixed after the latest round of trade talks. The CAC is in the lead with a gain of 0.18%, the FTSE lags with a loss of -0.14%, and the DAX is in the middle at 0.10%. The U.S. and China are still expected to hold meetings in China on October 10 but no deal is expected. The materials sector is in the lead with a gain of 1.1% while F&B has shed -0.5%.

In local news, UK PM Boris Johnson says he will not resign from his position even if he fails to secure a new deal. He says his ruling conservative party is the only one that can guide the UK through an October 31 hard-Brexit. UK GDP came in at -0.2%. The decline was as expected and came with a sigh of relief from traders.

Asian Markets Are Mixed, China Data Better Than Expected

The Asian markets are mixed if a bit more volatile than other global markets. News from China is good if still weak and has the Chinese-centric indices moving in opposite directions. The official Chinese PMI came in at 49.8 and 0.3 better than expected. A reading below 50 is contractionary so the news isn’t as good as it could be. On the other hand, the Caixin PMI of small-cap companies rose to 51.4 and 1.2 ahead of consensus. The Japanese Nikkei is down -0.56%, the Shanghai is down -0.29%, the Hang Seng is up about 0.55%, the ASX is down -0.41%, and the Kospi up 0.64%.