The Breakfast Briefing: Stocks Wobble After Fed Signals Pause In Further Rate Cuts

Ted

FYI: U.S. stock index futures turned lower on Thursday morning.

At around 6 a.m. ET, Dow futures were down 95 points, indicating a negative open of more than 86 points. Futures on the S&P — which closed at an all-time high in the previous session — and Nasdaq were both seen slightly lower.

Early Thursday, Bloomberg News reported, citing unnamed sources, that Chinese officials have been casting doubt over the possibility of a long-term trade deal with the U.S., despite the two sides closing in on an initial “phase one” accord, sending stock futures tumbling.

Global stocks were mixed and the dollar weakened Thursday after the Federal Reserve signaled a pause in further interest-rate easing following its third cut this year.

The U.K.’s FTSE 100 gauge and the pan-European Stoxx Europe 600 index wobbled between gains and losses as investors awaited preliminary eurozone figures for gross domestic product, consumer inflation and unemployment.
Stocks to Watch

Shares in Peugeot maker PSA Group were among the worst performers in Europe, dropping 8.8% following the auto maker’s agreement to merge with Fiat Chrysler Automobiles in a deal that will create one of the world’s largest auto makers by volume.

Fiat shares climbed 9.7% in Milan, while shares of rival Renault slumped 2.7%.

Royal Dutch Shell shares trimmed 2.8% after the oil giant expressed uncertainty over the pace of it completing its $25 billion share buyback, raising doubt over whether the program would be finished by the end of 2020.

In Asia, the Shanghai Composite edged down 0.4% after data showed Chinese manufacturing activity fell to an eight-month low in October, in yet another signal that the world’s second-largest economy is under pressure.
Regards,
Ted

WSJ:
https://www.wsj.com/articles/stocks-wobble-after-fed-signals-pause-in-further-rate-cuts-11572514720

Bloomberg:
https://www.bloomberg.com/news/articles/2019-10-30/asia-stocks-look-to-gain-treasuries-climb-on-fed-markets-wrap?srnd=premium

IBD:
https://www.investors.com/market-trend/stock-market-today/dow-jones-futures-apple-earnings-facebook-earnings-fed-rate-cut-stock-market-rally/

CNBC::
https://www.cnbc.com/2019/10/31/us-stocks-fed-signals-a-pause-in-rate-cuts.html

Reuters:
https://uk.reuters.com/article/us-usa-trade-china-agriculture/exclusive-beijing-could-ax-extra-tariffs-on-u-s-farm-products-to-boost-imports-china-trade-association-chief-idUKKBN1XA0L4

U.K.
https://uk.reuters.com/article/uk-britain-stocks/weak-earnings-hit-ftse-100-crest-warning-drags-homebuilders-idUKKBN1XA0ZK

Europe:
https://www.reuters.com/article/us-europe-stocks/fresh-trade-worries-drag-european-shares-lower-idUSKBN1XA122

Asia:
https://www.cnbc.com/2019/10/31/asia-markets-october-31-federal-reserve-china-pmi-apple-suppliers.html

Bonds:
https://www.cnbc.com/2019/10/31/us-treasury-yields-fed-cuts-rates-jobless-claims.html

Currencies:
https://www.cnbc.com/2019/10/30/forex-markets-us-federal-reserve-in-focus.html

Oil:
https://www.cnbc.com/2019/10/31/oil-markets-us-crude-inventories-in-focus.html

Gold:
https://www.cnbc.com/2019/10/31/gold-markets-federal-reserve-rate-cut-in-focus.html

Cuirrent Futures:
https://finviz.com/futures.ashx

Simon

Thanks Ted. The third British general election in four years (!!!) is now underway. I think the Conservatives will win again, but they may have to form an alliance with Nigel Farage's Brexit Party to gain overall control and finally push through Brexit. The Labour Party's policies of mass renationalization and tax increases for the middle classes are probably unpalitable to a great many voters.

Following the Fed cut yesterday a couple of my low duration bond funds dropped a tick or two, and a couple rose a tick (including DLSNX). My ultrashort funds (TRBUX, SEMRX) were on best behavior as always and slept through it all.