News / Analysis
Finance Update – Nokia to the MoonOctober 20, 2020
Asian markets are mixed this morning, the Nikkei down 0.54% and the Dow Jones NZ up 0.7%.
The Yuan – now at a 2-year high against the USD – continues upward after the People’s Bank overnight maintained its 3.85% interest rate. House prices in China added 4.6% in September.
In a day rife with central banker announcements, ECB Executive Board Member Yves Mersch yesterday stressed that recovery in the zone was “incomplete and prone to setbacks.” Germany’s Federal Bank President Jens Weidmann warned that the EU’s large-scale borrowing was concerning.
ECB President Lagarde added climate change to the challenges the EU was facing. And, on Brexit, EU negotiator said he was open to reinstate talks abandoned last week, while British Cabinet Minister Michael Gove said they are meaningless.
European indices yesterday performed weakly, the FTSE losing 0.59% with other benchmarks close behind. Construction output throughout the union increased by 2.57% MoM in August – nearly 10 times the month before.
Index futures overnight regained some losses from yesterday – the Nasdaq losing 1.65% and the Dow -1.44%.
The USD is level after WH Chief of Staff Meadows said yesterday that a new relief package could be reached by Wednesday. The Fed’s Vice Chairman Richard Clarida said that COVID relief would require additional fiscal and policy measures.
Atlanta Fed head Bostic yesterday said the economic recovery was weak to nonexistent in some sectors, while FED head Jerome Powell chose to address the potential issue of a digital dollar, saying cyber-attacks concerned him most of all.
The National Association of Home Builders yesterday published a 2-point improvement in the Housing Market index – up to 85 in October.
Despite 4 days of falling prices on the COVID resurgence and growing output from Libya, Oil continues sideways in the $41 region. OPEC+ members took note in their meeting yesterday, pledging action…
Meanwhile, gold remains within the 1900-1915 range.
A Reuters study released yesterday shows founder-led companies are recovering more quickly than CEO-led ones, the former growing profits by 30% on average, compared to 6.7% for the latter.
Moderna (-4.03%) yesterday announced it might seek emergency approval for its anti-corona vaccine as early as December.
And Nokia (+3.78%) announced yesterday it had been chosen by NASA to build a mobile network on the moon.
IBM (-0.33%) Q3 earnings yesterday came in in line with expectations at $2.58. Total revenue fell 2.6% YoY to $17.56 despite a 19% increase in cloud services – a 1/3 of the total cake. Shares lost another 3% after hours.
Halliburton (-0.65%) reported a $17 mn loss for Q3, translating to 2 cents per share. Q3 Revenue was down 46% YoY to $2.62 bn. Shares rose 2% in after-hours trading.
Earnings continue today with Netflix, Snap, Philip Morris, Lockheed Martin, Procter & Gamble, Prologis, Paccar, Dover, Vivendi, Reckitt Benckiser and Swedbank. Dollar General pays dividends.
|08:00 AM GMT||EU||Current Accounts|
|12:30 PM GMT||US||Building Permits & Housing Starts. Redbook Index at 12:55.|
|ND||NZ||Global Dairy Trade Index. Credit Card Spending at 2 AM GMT (+1)|
|08:30 PM GMT||OIL||API Crude Oil Inventories|
|11:30 PM GMT||Australia||Westpac Leading Index. Home sales at Midnight, Retail Sales at 0:30 AM (+1)|