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26Oct2017 Pre-Market Commentary: Wall Street Set To Open Higher As ECB Plan To Scale Back Monthly Asset Purchases, Higher Unemployment Numbers, Gold Index Futures Slipping

Written by Gary

US stock market index futures point to a moderately higher opening this morning (SPY +0.3%). The US dollar is rising moderately and the gold index has fallen 10 points as investors move to 'risk on'.


Here is the current market situation from CNN Money

European markets are higher today with shares in France leading the region. The CAC 40 is up 0.84% while Germany's DAX is up 0.57% and London's FTSE 100 is up 0.47%.

What Is Moving the Markets

Here are the headlines moving the markets.

Tesla's seat strategy goes against the grain...for now

The seats on Tesla Inc's new Model X SUV were a mess. An outside contractor was having trouble executing the complicated design, spurring frustration and finger-pointing between Tesla and its supplier.

Euro heads higher as ECB heads for the exit

LONDON (Reuters) - The euro climbed for a third day and stocks slipped to a month low on Thursday, as traders waited for formal confirmation from the European Central Bank that will take its biggest step yet in unwinding years of loose monetary policy.

Consumer groups join conservatives against AT&T deal for Time Warner

WASHINGTON (Reuters) - Seven groups ranging from the Tea Party Patriots to liberal consumer groups warned against AT&T's plan to buy Time Warner in a letter to Attorney General Jeff Sessions, saying the deal could give one company too much power over what Americans see on television.

Twitter nears first profitable quarter as it slashes expenses, shares jump

(Reuters) - Twitter Inc said on Thursday it could turn its first ever profit in the fourth quarter, after making sweeping cuts in expenses the past few months and finding sources of revenue beyond the advertising that dominates social media.

U.S. pickup truck sales lift Ford's margins, profits

DETROIT (Reuters) - Ford Motor Co reported a better-than-expected quarterly net profit on Thursday, driven largely by U.S. sales of its high-margin pickup trucks, and raised the low end of its full-year earnings forecast.

Wal-Mart launches shelf-scanning robots in about 40 stores

CHICAGO (Reuters) - Wal-Mart Stores Inc will roll out shelf-scanning robots in approximately 40 stores to replenish inventory faster on its shelves and save store employees time when products run out.

ConocoPhillips profit beats estimates, but budget cut 10 percent

HOUSTON (Reuters) - ConocoPhillips, the largest U.S. independent oil producer, reported a better-than-expected quarterly profit on Thursday helped by rising crude prices, though it slashed its capital budget to further cut costs.

Apple, Volkswagen, BMW warn EU over patent fees guidelines

BRUSSELS (Reuters) - Apple , Volkswagen , BMW and Daimler have warned EU regulators that adopting patent fee guidelines which favor Qualcomm and Ericsson could hurt consumers and hinder innovation.

Alphabet looks to snowy Michigan to test self-driving cars

WASHINGTON (Reuters) - Alphabet Inc's self-driving car unit Waymo is expanding winter testing as it works to address a potential blind spot for autonomous vehicles: snowy and icy conditions.

ECB Announces Dovish 30 Billion QE Taper Through September 2018 "Or Beyond"; Euro Tumbles

While the ECB kept all of its three key rates unchanged as expected, and also kept the pace of QE at 60 billion until the end of the year, confirming the numerous trial balloons overthe past month, the ECB announced that it would cut the rate of QE in half, to 30 billion "from January 2018 until the end of September 2018" adding that this would extend "beyond, if necessary" and "until inflation path has sustainably adjusted."

While the open-ended nature of the announcement was expected by some, the market has taken it as a dovish development, as well as the announcement that the ECB will reinvest the principal payments from maturing securities purchased under the APP "for an extended period of time after the end of its net asset purchases, and in any case for as long as necessary."

Incidentally, according to preliminary calculations, at a tapered 30 billion rate of QE, the ECB would have until Q2 2019 before it hits the Bund scarcity bottleneck.

Furthermore, the ECB's the soothing promise that "this will contribute both to favourable liquidity conditions and to an appropriate monetary policy stance" has led to dovish plunge in both Eurozone yields and the EURUSD, which tumbled on the announcement which the markets clearly perceived as risk-friendly.

Full

Gold Will Be Safe Haven Again In Looming EU Crisis

Gold will be safe haven again in looming EU crisis

- EU crisis is no longer just about debt but about political discontent
- EU officials refuse to acknowledge changing face of politics across the union
- Catalonia shows measures governments will use to maintain control
- EU currently holds control over banks accounts and ability to use cash
- Protect your savings with gold in the face of increased financial threat from EU

Editor: Mark O'Byrne

When we talk about the Eurozone crisis we are usually referring to the Eurozone debt crisis. According to the OECD the debt crisis of 2011 was the world's greatest threat.

Twitter Surges After Beating, Adding 4MM MAUs Despite Admitting It "Overcounted" Users For Years

In the first sign that President Trump's favorite social network may be finally turning the corner, Twitter reported revenue, EBITDA and earnings all of which beat expectations, at revenues of $589.6MM (vs exp.$587.5MM), EBITDA of $207MM (vs exp. $161MM) and non-GAAP EPS of $0.10, better than the $0.06 expected. Monthly active users rose by 4% to 330 million in the third quarter, which while below the 330.5mm expected was still a welcome development for investors who last quarter saw a decline in the company's MAU and punished the stock appropriately.

Twitter - which shifted the company's focus to videos and live events as a way to spur audience growth - attributed the user gains to changes making the platform easier to use, improved marketing and heightened awareness of Twitter from global events.

While the company said daily active users increased 14% from a year earlier, it declined to disclose the actual number. Twitter has argued that doing so would result in unfair comparison with Facebook, which has about 1.3 billion daily active users. Snap had 173 million daily active users in the second quarter. Aegis Capital Corp. estimates Twitter had 160 million daily active users in the quarter.

"This quarter we made progress in three key areas of our business: we grew our audience and engagement, made progress on a return to revenue growth, and achieved record profitability," Dorsey said in the statemen ...

Catalan Government Said To Back Off Independence Push, Will Seek Elections; Spanish Stocks Soar, Yields Tumble

Yesterday Catalonia's government was preparing to declare independence, as we discussed. Just hours after Puigdemont snubbed Madrid, canceling his visit to The Senate to discuss their imposition of Article 155, Catalan Deputy First Minister Oriol Junqueras told AP that the Spanish government had left Catalonia "no other option" but to proclaim a new republic. Mr. Junqueras told the AP he was commenting as leader of his party, Republican Catalan Left, not as a member of the regional government. Additionally, Puigdemont posted a defiant Instagram message: "We will not lose time with those who have already decided to crush Catalan self-government. Onwards!"

However, just a few hours later, the Catalonia leadership seems to have backed down, and instead is opting for elections, reportedly just before Christmas.

According to Bloomberg, Catalan President Carlos Puigdemont may call regional elections this week, rather than declaring independence from Spain, as authorities in Madrid finalize plans to oust his rebel administration, according to two people familiar with his thinking.

After defying the Spanish courts for weeks, Puigdemont decision could either ease tensions or deepen the biggest constitutional crisis in western Europe's fifth-largest country since an attempted coup in 1981. Spain's chief prosecutor has warned he faces up to 30 years in jail if he goes ahead with the declaration.

"The scenario of independence is one that we cannot allow and which will not happen," Economy Minister Luis de Guindos told Spanish radio on Thursday. He said ...

Line's Shareholders Aren't Getting the Message

The Japanese app is making more money from its users. Trouble is, its user base isn't growing.

Get Ready for an Imperial China

Xi Jinping, China's most powerful leader in decades, has failed to anoint a clear successor in a sharp break from previous convention.

Express Scripts Only Looks Cheap

The pharmacy-benefits manager has a low valuation but that masks challenges including growth, regulation and competition.

Economic Report: U.S. jobless claims climb 10,000 to 233,000 a week after hitting 44-year low

U.S. jobless claims rose slightly to 233,000 in late October, just a week after dropping to a 44-year bottom. But layoffs are still near the lowest level since the early 1970s.

Market Snapshot: U.S. stocks set to rise as ECB unveils plan to scale back monthly asset purchases

U.S. stock futures rise on Thursday as the European Central bank, as expected, announced plans to extend the length of its quantitative-easing measures but reduce its monthly asset purchases, marking a sign of a gradual tapering of crisis-era measures by the central bank.

Your Digital Self: Google's new camera takes you into the future of artificial intelligence

Google Clips learns how to recognize people — and when to take photos, writes Jurica Dujmovic.

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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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