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05Oct2017 Pre-Market Commentary: Wall Street To Open Higher, Crude Prices And US Dollar Show Slight Improvement, Markets May Become Flat And Mixed Before Closing

Written by Gary

US stock market indexes are looking for another fractionally higher opening this morning (SPY +0.1%).


Here is the current market situation from CNN Money

European markets are mixed today. The FTSE 100 is up 0.30% while the CAC 40 gains 0.04%. The DAX is off 0.16%.

What Is Moving the Markets

Here are the headlines moving the markets.

Global stock market party settles down for central bank reflection

LONDON (Reuters) - Global stocks came off record highs and the euro fell back toward seven-week lows on Thursday as minutes from the European Central Bank's last meeting showed policymakers had widespread concerns about the single currency's rapid rise.

U.S. budget deficit could obstruct Trump's tax cut plan

WASHINGTON (Reuters) - The U.S. budget deficit is proving to be a major obstacle to the tax reform plan being offered by President Donald Trump and top congressional Republicans, with one leading Senate hawk saying a week after the plan was introduced that any enlarging of the fiscal gap could kill his support.

Wall Street rally on pause, but more gains seen in 2018: Reuters poll

NEW YORK (Reuters) - A more than eight-year bull market on Wall Street will simmer for the rest of 2017 before picking up again next year, said strategists in a Reuters poll who were optimistic about corporate profits but concerned about slow tax reform progress.

Saudi Aramco IPO on track for 2018: officials

MOSCOW (Reuters) - A plan to list Saudi Aramco in 2018 is on track, senior Saudi officials said in Moscow on Thursday, as Saudi Arabia gears up to sign a string of investment agreements with Russia.

Bain Capital aims to list Toshiba chip unit in three years

TOKYO (Reuters) - U.S. private equity firm Bain Capital LP on Thursday said it aims to list Toshiba Corp's chip unit on the Tokyo Stock Exchange within three years, to cash in its investment after leading an $18 billion acquisition of the business.

Exclusive: Airbus defense unit freezes capex, may miss cash goals - memo

PARIS (Reuters) - Airbus Defence and Space has frozen capital spending and urged its 34,000 staff to take "drastic measures" to save cash as it faces the prospect of missing 2017 cash targets by hundreds of millions of euros, according to a memo seen by Reuters.

KPMG South Africa CEO promises reform after Gupta scandal

CAPE TOWN (Reuters) - KPMG's new chief executive in South Africa said on Thursday she would make sweeping changes to ensure the firm did not repeat "greatly disappointing" work it did for business friends of President Jacob Zuma.

Linde urges investors to exchange shares for Praxair merger

(Reuters) - German industrial gases group Linde urged investors to tender their shares in an exchange offer for its planned $80 billion merger with U.S. peer Praxair as a deadline approaches to reach 75 percent acceptance.

Nissan's premium brand Infiniti global sales up 8 percent in September

BEIJING (Reuters) - Nissan Motor Co's premium brand Infiniti sold 21,523 vehicles globally in September, up 8 percent from a year earlier and pushing the brand's worldwide sales in the first nine months of this year to 182,884 vehicles, up 11 percent.

Yahoo Hacking Of 3 Billion Accounts Underlines Cyber Risk

Yahoo Hacking Of 3 Billion Accounts Underlines Cyber Risk

- Yahoo admits every single one of 3 billion accounts hacked in 2013 data theft
- Equifax hacking and security breach exposes half of the U.S. population
- Some 143 million people vulnerable to identity theft
- Deloitte hack compromised sensitive emails and client data
- JP Morgan hacked and New York Fed hacked and robbed
- International hacking group steals $300 million

Bull Trap: The False Promise Of Tax Cuts

Authored by Lance Roberts via RealInvestmentAdvice.com,

Last week, I did a fairly extensive analysis on the release of the 9-page "Trump Tax Cut" plan.

The most important aspect of that discussion was the difference between 1982, the last time there was permanent tax reform, as compared to today.

"Comparing Trump's economic policy proposals to those of Ronald Reagan. For those that deem that bullish, we remind you that the economic environment and potential growth of 1982 was vastly different than it is today. Consider the following table:'"

1982-today

The differences between today's economic and market environment could not be starker. The tailwinds provided by initial deregulation, consumer leveraging and declining interest rates and inflation provided huge tailwinds for corporate profitability growth.

Most importantly, when tax cuts were implemented in the mid-80's, the U.S. economy was just coming out of back-t0-back recession versus being in the third longest economic expansion on record to date.

ECB Minutes Are A Dud, Fail To Excite Markets

For all the excitement surrounding today's ECB minutes release, they turned out to be a dud, with the EURUSD failing to move even 10 pips, and Bund yields largely unchanged. Contrary to expectations, the minutes did not disclose anything new, instead echoing what Peter Praet said on Monday.

Of note, the minutes revealed that ECB officials discussed various options to recalibrate QE at the September policy meeting, a recalibration which should proceed in very gradual, cautious manner. And, as Reuters had noted previously, ECB officials "disagreed" on reasons for recent Euro appreciation.

Digging through, the minutes also noted that the Governing Council members had a "preliminary exchange of views about the future monetary policy stance and the considerations that might guide a recalibration of instruments and the transmission channels through which they shape financial conditions and the outlook for price stability,"

Hinting at the upcoming taper, "A view was put forward that conditions were increasingly falling into place that would allow the intensity of monetary policy accommodation to be adapted and would provide an opportunity to scale back the Eurosystem's net asset purchases." At the same time, officials were in "broad agreement" that substantial policy support was still needed.

Confirming the confusion over how to tighten, officials discussed "some general trade-offs inherent in various scenarios for the future recalibration of the APP and, in particular, the choice between the pace and the intended duration." Furthermore, "benefits from a longer intended purchase horizon, combined with a greater reduction in the pace, were compared with those from a shorter period of purchases and larger monthly volume."

Policymakers also expressed concern about speed of recent euro appreciatio ...

Theresa May Could Be Ousted By Christmas As "Quite A Few" MPs "Firmly" Want Her Out: Report

Following Theresa May's "disastrous" conference speech in Manchester yesterday, in which she had a coughing fit preventing her from speaking for minutes, while a heckler gave her the UK equivalent of a pink slip, and ended with letters falling from the slogan behind the stage and the Prime Minister being comforted by her husband, her political future is reportedly hanging in the balance, leaving her feeling "extremely distraught." Overnight, the Telegraph reported that May could be ousted as Prime Minister as soon as Christmas because as many as 30 Tory MPs are said to be preparing a letter calling for May's resignation.

In the speech, Mrs May apologised for the election defeat and spoke passionately about Brexit. She said: "We did not get the victory we wanted because our national campaign fell short. It was too scripted, too presidential, and it allowed the Labour Party to paint us as the voice of continuity, when the public wanted to hear a message of change. "I hold my hands up for that. I take responsibility. I led the campaign. And I am sorry."

And while May was "extremely distraught" for all the glitches surrounding her speech, with her Cabinet publicly supported the prime minister, privately Tory MPs said she was "limping like a broken horse into oblivion" and suggested that talks about her departure will have to be "accelerated".

As the Telegraph first reported, May's apology was well received in the conference hall, but it emerged on Wednesday night that as many as 30 Tory MPs are thought to be prepared to sign a letter calling ...

Why Google's Gadgets Are Worth the Reach

Expanding product lineup helps the web giant get services into more hands.

Even Tougher Choices Ahead for Teva After FDA Shocker

A surprise move from the Food and Drug Administration means that a recovery for Teva Pharmaceutical Industries just got much more difficult.

Curb Your Enthusiasm About the Jobs Report

The way the stock market reacts to Friday's jobs report may say more about the stock market than it does about jobs.

'Blade Runner 2049' already looks like a hit

"Blade Runner 2049" is a week away from hitting theaters and is already being heralded as a masterpiece and outperforming on early ticket sales.

Economic Report: Jobless claims drop 12,000 to 260,000 as disruptions from hurricanes ease

Record job openings and strong hiring are keeping the number of Americans applying for unemployment benefits at very low levels. Jobless claims fell by 12,000 to 260,000 at the end of September.

Mylan's surprise generic win sends Teva, Momenta shares plunging

The multiple sclerosis drug Copaxone brought in $4 billion last year for Teva, and generic competition wasn't expected until at least 2018.

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To contact me with questions, comments or constructive criticism is always encouraged and appreciated:

gary@econintersect.com

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