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Writer's pictureSimon Charles Hooper

22/10/21 Briefing

The S&P 500 futures trade 14 points, or 0.3%, above fair value in record territory, as the market continues to weather supply chain challenges and inflation pressures. The Nasdaq 100 futures, however, are underperforming and trading 0.1% below fair value.

Intel (INTC 50.30, -5.70, -10.2%), Honeywell (HON 220.90, -2.63, -1.6%), and Snap (SNAP 60.66, -14.45, -19.2%) each missed revenue estimates and provided relatively disappointing guidance, calling out supply chain disruptions either affecting their businesses or partners (in Snap's case).

Snap also blamed Apple's (AAPL 150.04, +0.56, +0.4%) privacy changes for its revenue miss, which has pressured shares of Facebook (FB 329.29, -12.59, -3.7%), Alphabet (GOOG 2809.70, -45.91, -1.6%), and Twitter (TWTR 62.92, -2.48, -3.7%).

In Washington, Democrat leaders continue to close in on a human infrastructure deal, although divisions reportedly remain over climate spending, paid leave, Medicare expansion, and taxes. On a related note, President Biden said he doesn't expect gas prices to ease until next year. WTI crude futures are currently up 0.8% to $83.19/bbl.

Shorter-dated Treasury yields continue to edge higher, reflecting increased expectations for the Fed to tighten policy sooner than forecasted. The 2-yr yield is currently up four basis points to 0.47% while the 10-yr yield is up one basis point to 1.68%. The U.S. Dollar Index is down 0.2% to 93.63.

Today's economic data will be limited to the preliminary IHS Markit Manufacturing and Services PMIs for October, which will be released at 9:45 a.m. ET.

In U.S. Corporate news:

  • Intel (INTC 50.30, -5.70): -10.2% after missing revenue estimates, issuing mixed Q4 guidance, and saying it expects gross margins to be below current levels for the next 2-3 years. Intel issued upside FY22 revenue guidance. On a related note, its CFO will retire in May 2022.

  • Honeywell (HON 220.90, -2.63): -1.6% after missing revenue estimates and guiding FY21 revenue below consensus. Honeywell beat EPS estimates.

  • American Express (AXP 179.00, +1.53): +0.9% after beating top and bottom-line estimates.

  • Snap (SNAP 60.66, -14.45): -19.2% after missing revenue estimates and guiding Q4 revenue below consensus. The company blamed Apple's (AAPL 150.04, +0.56, +0.4%) privacy changes and supply chain disruptions for its advertisers.

  • Mattel (MAT 21.55, +1.22): +6.0% after beating top and bottom-line estimates and upping its fiscal year net sales guidance growth percentage.

Reviewing overnight developments:

  • Equity indices in the Asia-Pacific region ended the week on a mixed note. Japan's Nikkei: +0.3% (-0.9% for the week) Hong Kong's Hang Seng: +0.4% (+3.1% for the week) China's Shanghai Composite: -0.3% (+0.3% for the week) India's Sensex: -0.2% (-0.8% for the week) South Korea's Kospi: UNCH (-0.3% for the week) Australia's ASX All Ordinaries: UNCH (+0.7% for the week)

    • In economic data:

      • Japan's September CPI 0.4% m/m (last 0.2%) and September National Core CPI 0.1% yr/yr, as expected (last -0.2%). Flash October Manufacturing PMI 53.0 (last 51.5) and flash Services PMI 50.7 (last 47.5).

      • Singapore's Q3 URA Property Index 1.1% qtr/qtr (last 0.9%)

      • Australia's flash October Manufacturing PMI 57.3 (last 56.8) and flash Services PMI 52.0 (last 45.5)

      • Hong Kong's September CPI 1.4% yr/yr (expected 3.0%; last 1.6%)


  • In news:

    • Evergrande made up last month's missed bond payment just ahead of Saturday's deadline.

    • Fitch downgraded developer Sinic to Restricted Default after the company missed a bond payment of its own earlier this week.

    • Japan's Services PMI expanded for the first time in 21 months in the flash reading for October.

    • The Reserve Bank of Australia conducted its first unscheduled asset purchase operation to defend the yield curve since February.



  • Major European indices are looking for a higher finish to the week while Spain's IBEX (-0.1%) underperforms. STOXX Europe 600: +0.7% (+0.8% week-to-date) Germany's DAX: +0.9% (+0.1% week-to-date) U.K.'s FTSE 100: +0.5% (-0.1% week-to-date) France's CAC 40: +1.1% (+0.4% week-to-date) Italy's FTSE MIB: +0.5% (+0.6% week-to-date) Spain's IBEX 35: -0.1% (-0.7% week-to-date)

    • In economic data:

      • Eurozone's flash October Manufacturing PMI 58.5 (expected 57.0; last 58.6) and flash Services PMI 54.7 (expected 55.5; last 56.4)

      • Germany's flash October Manufacturing PMI 58.2 (expected 56.5; last 58.4) and flash Services PMI 52.4 (expected 55.0; last 56.2)

      • U.K.'s flash October Manufacturing PMI 57.7 (expected 55.8; last 57.1) and flash Services PMI 58.0 (expected 54.5; last 55.4). September Retail Sales -0.2% m/m (expected 0.5%; last -0.6%); -1.3% yr/yr (expected -0.4%; last -0.2%). September Core Retail Sales -0.6% m/m (expected 0.2%; last -1.2%); -2.6% yr/yr (expected -1.7%; last -0.9%)

      • France's flash October Manufacturing PMI 53.5 (expected 54.0; last 55.0) and flash Services PMI 56.6 (expected 55.5; last 56.2)


  • In news:

    • Bank of England Chief Economist Pill said that there is a potential for a rate hike in November and that inflation in the U.K. could exceed 5.0%.

    • Riksbank Deputy Governor warned that even a temporary spike in prices could increase expectations for future inflation.

    • L'Oreal beat Q3 expectations while Renault reported lower sales but reaffirmed its operating margin target for the full year.





U.S. equity futures:

  • S&P 500 Futures: +6 @ 4,555

  • DJIA Futures: +76 @ 35,679

  • Nasdaq 100 Futures: -27 @ 15,463

Overseas:

  • Europe: DAX +0.9%, FTSE +0.5%, CAC +1.1%

  • Asia: Nikkei +0.3%, Hang Seng +0.4%, Shanghai -0.3%

Commodities:

  • Crude Oil +0.72 @ 83.22

  • Nat Gas +0.206 @ 5.321

  • Gold +12.15 @ 1794.05

  • Silver +0.205 @ 24.375

  • Copper +0.0233 @ 4.5820

U.S. Summary:

  • Earnings/Guidance (Full Earnings Calendar):

    • Accuray (ARAY) issues upside SepQ and FY22 revenue guidance

    • Altra Industrial Motion (AIMC) misses by $0.02, reports revs in-line; guides FY21 EPS below consensus, revs below consensus

    • American Express (AXP) beats by $0.52, beats on revs

    • Assoc Banc-Corp (ASB) beats by $0.12

    • Autoliv (ALV) misses by $0.13, misses on revs; lowers FY21 guidance

    • Bank OZK (OZK) beats by $0.04, beats on revs

    • BJ Restaurants (BJRI) misses by $0.24, misses on revs; comps up +41.8%

    • Boston Beer Co (SAM) reports Q3 (Sep) results, beats on revs

    • Cambium Networks (CMBM) lowers Q3 revenue guidance due to global supply constraints, expects net income to be below low-end of prior range

    • Carlisle Cos (CSL) beats by $0.24, beats on revs

    • Celanese (CE) beats by $0.10, beats on revs; guides Q4 EPS above consensus; guides FY22 EPS above consensus

    • Chipotle Mexican Grill (CMG) beats by $0.70, reports revs in-line; comps +15.1%

    • Cleveland-Cliffs (CLF) beats by $0.10, beats on revs

    • DMC Global (BOOM) misses by $0.08, misses on revs; guides Q4 revs in-line

    • First Financial (FFIN) beats by $0.03, net interest income increased 7.4% yr/yr

    • Glacier Bancorp (GBCI) beats by $0.07, beats on revs

    • HCA (HCA) beats by $0.56, beats on revs; raises FY21 guidance

    • Honeywell (HON) beats by $0.02, misses on revs; guides FY21 EPS in-line, revs below consensus

    • Intel (INTC) beats by $0.60, misses on revs; guides Q4 EPS below consensus, revs above consensus, issues upside FY22 revenue guidance of $74.0 bln; CFO to retire

    • Mattel (MAT) beats by $0.12, beats on revs; ups FY net sales guidance growth percentage

    • Olin (OLN) beats by $0.40, misses on revs

    • People's United Financial (PBCT) beats by $0.01, misses on revs

    • PriceSmart (PSMT) misses by $0.10, beats on revs

    • Regions Fincl (RF) beats by $0.12, beats on revs

    • Robert Half (RHI) beats by $0.13, beats on revs

    • Roper (ROP) beats by $0.06, misses on revs

    • Schlumberger (SLB) reports EPS in-line, misses on revs

    • Simply Good Foods (SMPL) misses by $0.07, beats on revs; provides FY21 guidance

    • Snap (SNAP) beats by $0.09, misses on revs; guides Q4 revs below consensus

    • SVB Financial Group (SIVB) beats by $0.65, beats on revs

    • U.S. Xpress (USX) misses by $0.07, beats on revs

    • V.F. Corp (VFC) misses by $0.05, misses on revs; guides FY22 EPS above consensus, revs above consensus

    • Vicor (VICR) misses by $0.14, misses on revs

    • Western Alliance Bancorp (WAL) beats by $0.03, beats on revs

    • Whirlpool (WHR) beats by $0.50, misses on revs; slightly raises FY21 EPS guidance, but lowers FY21 revenue guidance

    • W.R. Berkley (WRB) beats by $0.39, beats on revs

    • WSFS Financial (WSFS) beats by $0.31, reports revs in-line


  • General News:

    • Democrats remain divided over climate spending, paid leave, and Medicare expansion in reconciliation bill. However, Senator Kyrsten Sinema (D-AZ) indicated she is in favor of revenue mechanisms besides corporate or individual tax increases. She is in favor of getting revenue from tax enforcement and international taxes, according to Politico

    • White House limits child tax credit in reconciliation package to 1 year and wants "significant cutbacks" on who will qualify for paid leave; paid leave program would last from 2024-2028 - CNBC

    • President Biden says he is mulling using national guard to help with supply issues, according to the Wall Street Journal

    • Evergrande has made overdue interest payment, according to the Wall Street Journal

    • President Biden says US would defend Taiwan from an attack from China, according to Bloomberg

    • Trade groups for UPS (UPS) and FedEx (FDX) are warning that vaccine mandates could cause problems for holiday air cargo, according to Politico

    • USTR Katherine Tai is hopeful US and EU could resolve dispute over steel and aluminum tariffs with EU, according to Reuters

    • Moscow goes under lockdown due to rise in COVID-19 cases, according to New York Times

    • Achilles Therapeutics (ACHL) Presents Data at the 2021 European Society for Gene and Cell Therapy (ESGCT) Congress Demonstrating its Proprietary Manufacturing Process Can Generate Potent, Personalized Anti-Cancer Cell Therapy Candidates in Multiple Solid Tumor Types

    • Allison Transmission (ALSN) will install FuelSense 2.0 software to 493 Dennis Eagle and Mercedes-Benz Econic trucks operated by Biffa

    • Altra Industrial Motion (AIMC) announces retirement of CFO Christian Storch and appoints Altra Veteran Todd Patriacca as Chief Financial Officer

    • Apple (AAPL) talks with Chinese battery makers for electric car have hit a roadblock, according to Reuters

    • Athira Pharma (ATHA) announces the appointment of Mark Litton as Chief Executive Officer of Athira

    • Baxter (BAX) and bioMrieux announce CE Mark for NEPHROCLEAR CCL14 Test to predict persistent severe acute kidney injury

    • Encompass Health (EHC) and Baptist Health South Florida expand JV agreement

    • Generation Bio (GBIO) presents new preclinical data demonstrating widespread delivery of multiple nucleic acid cargos to photoreceptors using the company's cell-targeted lipid nanoparticle

    • Genesco (GCO) appoints Thomas A. George to serve as CFO, effective October 20

    • Genetron (GTH) and Fosun Pharma Announce Exclusive Partnership to Commercialize Seq-MRD in China

    • IdaCorp (IDA) raises quarterly dividend to $0.75/sh from $0.71/sh

    • Kontoor Brands (KTB) increases quarterly cash dividend to $0.46/share from $0.40/share

    • Lyft (LYFT) had 4000 claims of sexual assault from 2017-2019, according to Bloomberg

    • Merck (MRK) receives EC approval for KEYTRUDA (pembrolizumab) plus chemotherapy unresectable or metastatic triple-negative breast cancer

    • Metacrine (MTCR) reports interim results from Phase 2a trial of MET642 in patients with NASH; announces strategic re-prioritization of clinical development programs

    • Moderna (MRNA): CDC panel votes to endorse boosters for COVID-19 vaccines from Moderna and Johnson & Johnson (JNJ)

    • Parsons (PSN) announces the award of a potential ten-year, $1.1 bln multiple award task order contract by the United States Army Corps of Engineers

    • Rogers Comms (RCI) appoints John A. MacDonald as Chairman of Rogers Communications

    • Southern's Georgia Power (SO) announces revised schedule for Vogtle 3 & 4 nuclear expansion project

    • Stellantis (STLA) and Samsung (SSNLF) to form joint venture for lithium-ion battery production in North America


  • M&A:

    • 23andMe (ME) acquires Lemonaid Health for $400 mln in cash and stock

    • a.k.a. Brands (AKA) acquires equity interests of mnml for $48.6 mln

    • Altus Midstream (ALTM) announces all-stock business combination with EagleClaw; APA Corp. (APA) ownership in Altus to be reduced

    • Ares Management (ARES) makes strategic investment in LaserAway; terms not indicated

    • Jones Lang LaSalle (JLL) to acquire Building Engines, a building operations platform, for $300 mln

    • Korn/Ferry (KFY) enters into definitive agreement to acquire Lucas Group; financial terms not disclosed

    • Olo Inc. (OLO) announces it will acquire Wisely Inc.

    • Rattler Midstream (RTLR) to acquire certain water midstream assets from parent Diamondback for $160 mln in cash in a drop down transaction

    • SoftBank (SFTBY) in discussions to sell robotics unit in France to United Robotics Group, according to Reuters

    • Western Digital (WDC): Talks to merge with Japanese chip maker Kioxia have stalled, according to Wall Street Journal

    • ZIM Integrated Shipping (ZIM) announces acquisition of seven secondhand vessles during October


  • Syndicate:

    • IVERIC bio (ISEE) prices offering of 9 mln shares of common stock at $16.75 per share

    • Rite Aid (RAD) files mixed securities shelf offering

    • Velo3D (VLD) files for 169,147,569 share common stock offering by selling shareholders


  • IPOs:

    • Priced to Trade:

      • Aris Water Solutions (NYSE: ARIS): The environmental infrastructure and solutions company that helps customers reduce their water and carbon footprints priced its 17.7 M share IPO at $13, below the $16-$18 expected range.



Gapping Up/Down

  • Gapping up:

    • ATHA +7.6%, MAT +6.3%, ARAY +3.4%, WSFS +2.8%, GBCI +2.7%, KTB +1.9%, AMD +1.9%, TMCI +1.4%, OLO +1.3%, REGN +1.2%, OLN +1.2%, PSN +0.6%, ZIM +0.6%, WAL +0.6%, WDC +0.5%, WRB +0.5%, ASB +0.5%


  • Gapping down:

    • MTCR -51.4%, SNAP -20.7%, CMBM -16.1%, BOOM -10%, INTC -9.8%, CRTO -8.4%, TTD -5.3%, MGNI -5.1%, TWTR -4.5%, USX -4.4%, FB -4.1%, SAM -4.1%, BJRI -3.9%, VICR -2.9%, PUBM -2.7%, MRNA -2.7%, PINS -2.6%, ROKU -2.6%, DVAX -2.1%, GREE -2%, GOOG -1.8%, WHR -1.1%, RAD -1%, IDA -0.9%, RHI -0.5%, PSMT -0.5%


Analyst Research (see Upgrades/Downgrades calendar for full list):

  • Upgrades

    • Am Natl Bankshares (AMNB) upgraded to Overweight from Equal-Weight at Stephens; tgt raised to $39.50

    • Coterra Energy (CTRA) upgraded to Buy from Neutral at Goldman; tgt $25

    • GasLog Partners (GLOP) upgraded to Buy from Hold at Jefferies; tgt raised to $6.50

    • Invesco (IVZ) upgraded to In-line from Underperform at Evercore ISI; tgt $28

    • Lindsay Corp (LNN) upgraded to Buy from Hold at Stifel; tgt lowered to $178

    • Marsh McLennan (MMC) upgraded to Outperform from Underperform at Raymond James; tgt $185

    • NVIDIA (NVDA) upgraded to Buy from Sell at Summit Insights

    • TRI Pointe Homes (TPH) upgraded to Sector Perform from Underperform at RBC Capital Mkts; tgt raised to $25

    • Urban Outfitters (URBN) upgraded to Buy from Neutral at Citigroup; tgt lowered to $40

    • Zoom Video (ZM) upgraded to Overweight from Neutral at JP Morgan; tgt $385


  • Downgrades:

    • Ally Financial (ALLY) downgraded to Neutral from Overweight at Piper Sandler; tgt lowered to $59

    • BankUnited (BKU) downgraded to Neutral from Overweight at Piper Sandler; tgt $45

    • Freeport-McMoRan (FCX) downgraded to Hold from Buy at Deutsche Bank; tgt lowered to $43

    • Intel (INTC) downgraded to Equal-Weight from Overweight at Morgan Stanley; tgt lowered to $55

    • Intel (INTC) downgraded to Neutral from Buy at Mizuho; tgt lowered to $55

    • Intel (INTC) downgraded to Neutral from Buy at UBS; tgt lowered to $58

    • Metacrine (MTCR) downgraded to Hold from Buy at Canaccord Genuity; tgt lowered to $1

    • Metacrine (MTCR) downgraded to Hold from Buy at Jefferies; tgt lowered to $2

    • Metacrine (MTCR) downgraded to Neutral from Buy at H.C. Wainwright

    • Metacrine (MTCR) downgraded to Sector Perform from Outperform at RBC Capital Mkts; tgt $2.50

    • PPG Industries (PPG) downgraded to Neutral from Overweight at JP Morgan; tgt $165

    • Southwest Air (LUV) downgraded to In-line from Outperform at Evercore ISI; tgt lowered to $48

    • T. Rowe Price (TROW) downgraded to In-line from Outperform at Evercore ISI; tgt $211

    • TriState Capital Holdings (TSC) downgraded to Neutral from Buy at B. Riley Securities

    • U.S. Xpress (USX) downgraded to Underperform from Neutral at BofA Securities; tgt raised to $9


  • Others:

    • AAR Corp (AIR) initiated with an Outperform at RBC Capital Mkts; tgt $45

    • Acutus Medical (AFIB) initiated with a Neutral at Goldman; tgt $10

    • AeroVironment (AVAV) initiated with a Sector Perform at RBC Capital Mkts; tgt $95

    • BioNTech (BNTX) initiated with a Hold at Deutsche Bank; tgt $250

    • Boeing (BA) initiated with an Outperform at RBC Capital Mkts; tgt $275

    • Cinemark (CNK) initiated with an Equal Weight at Wells Fargo; tgt $22

    • CureVac (CVAC) initiated with a Hold at Deutsche Bank; tgt $35

    • Decibel Therapeutics (DBTX) initiated with an Outperform at Robert W. Baird; tgt $21

    • Ducommun (DCO) initiated with an Outperform at RBC Capital Mkts; tgt $62

    • ESS Inc. (GWH) initiated with a Buy at Loop Capital; tgt $29

    • Fluor (FLR) resumed with an Underperform at BofA Securities; tgt $17

    • Global-E Online (GLBE) initiated with a Buy at Needham; tgt $75

    • HEICO (HEI) initiated with a Sector Perform at RBC Capital Mkts; tgt $145

    • Hexcel (HXL) initiated with a Sector Perform at RBC Capital Mkts; tgt $65

    • IMAX (IMAX) initiated with an Overweight at Wells Fargo; tgt $27

    • KnowBe4 (KNBE) initiated with an Outperform at Wolfe Research; tgt $35

    • Kratos Defense and Security (KTOS) initiated with an Outperform at RBC Capital Mkts; tgt $28

    • Mercury (MRCY) initiated with a Sector Perform at RBC Capital Mkts; tgt $55

    • Moderna (MRNA) initiated with a Sell at Deutsche Bank; tgt $250

    • Science 37 (SNCE) initiated with an Outperform at Cowen; tgt $14

    • Southwestern Energy (SWN) resumed with a Neutral at Goldman; tgt $5.25

    • Spirit Aerosystems (SPR) initiated with an Outperform at RBC Capital Mkts; tgt $62

    • Transdigm Group (TDG) initiated with an Outperform at RBC Capital Mkts; tgt $700

    • Valens Semiconductor (VLN) initiated with a Buy at Citigroup; tgt $13

    • VSE Corp (VSEC) initiated with an Outperform at RBC Capital Mkts; tgt $60


Upcoming Events:

  • Econ Data:

    • 09:45 ET: IHS Markit Manufacturing PMI - Prelim for Oct (Briefing.com Consensus NA; Prior 60.7)

    • 09:45 ET: IHS Markit Services PMI - Prelim for Oct (Briefing.com Consensus NA; Prior 54.9)


  • Earnings

    • Monday (Oct 18)

      • Morning: ACI PHG STT

      • Afternoon: ELS FNB HXL STLD ZION


  • Tuesday (Oct 19)

    • Morning: BK CBSH DOV ERIC FITB FMBI HAL IRDM JNJ KSU MAN ONB PM PG SBNY SI SYF SNV TRV

    • Afternoon: CNI FULT HWC IBKR ISRG MRTN NBHC NFLX OMC LRN UAL UCBI WDFC WTFC


  • Wednesday (Oct 20)

    • Morning: ABT ANTM ASML BKR BIIB BOKF CP CFG CMA FHN FCFS KNX LAD MTB MKTX MSM NDAQ NEE NEP NTRS BPOP VZ WSO WGO

    • Afternoon: CNS CCI CSX CVBF DFS EFX EEFT FR GL GGG IBM KALU KMI LRCX LSTR LVS OMF PPG XM REXR RLI SLM SEIC SLG STL FTI THC TSLA TCBI UFPI UMPQ VMI


  • Thursday (Oct 21)

    • Morning: ABB ALK ALLE ALLY AAL T AN BANC BKU BX GTLS CROX DHR DOW EWBC FAF FCX GATX GPC HRI HOMB IPG IQV KEY LNN MMC NUE NVR PPBI POOL PDS DGX RCI SASR SNA SON LUV TSCO TPH TRN UNP VLO WBS

    • During Market Hours: WABC

    • Afternoon: ASB OZK BJRI SAM CSL CE CMG BOOM FFBC GBCI INTC MAT OLN PBCT PSMT RHI SNAP SIVB VICR WRB WAL WHR WSFS


  • Friday (Oct 22)

    • Morning: AIMC AXP ALV CLF FHB GNTX HCA HON RF ROP SLB STX SMPL VFC



Asia & Europe detail:

Asia: Nikkei +0.3%, Hang Seng +0.4%, Shanghai -0.3%

Equity indices in the Asia-Pacific region ended the week on a mixed note. Evergrande made up last month's missed bond payment just ahead of Saturday's deadline. Fitch downgraded developer Sinic to Restricted Default after the company missed a bond payment of its own earlier this week. Japan's Services PMI expanded for the first time in 21 months in the flash reading for October. The Reserve Bank of Australia conducted its first unscheduled asset purchase operation to defend the yield curve since February.

  • In economic data:

    • Japan's September CPI 0.4% m/m (last 0.2%) and September National Core CPI 0.1% yr/yr, as expected (last -0.2%). Flash October Manufacturing PMI 53.0 (last 51.5) and flash Services PMI 50.7 (last 51.5)

    • Singapore's Q3 URA Property Index 1.1% qtr/qtr (last 0.9%)

    • Australia's flash October Manufacturing PMI 57.3 (last 56.8) and flash Services PMI 52.0 (last 45.5)

    • Hong Kong's September CPI 1.4% yr/yr (expected 3.0%; last 1.6%)


---Equity Markets---

  • Japan's Nikkei: +0.3% (-0.9% for the week)

  • Hong Kong's Hang Seng: +0.4% (+3.1% for the week)

  • China's Shanghai Composite: -0.3% (+0.3% for the week)

  • India's Sensex: -0.2% (-0.8% for the week)

  • South Korea's Kospi: UNCH (-0.3% for the week)

  • Australia's ASX All Ordinaries: UNCH (+0.7% for the week)

---FX---

  • USD/JPY: -0.2% to 113.83

  • USD/CNH: -0.2% to 6.3825

  • USD/INR: UNCH at 74.86

Europe: DAX +0.9%, FTSE +0.5%, CAC +1.1%

Major European indices are looking for a higher finish to the week while Spain's IBEX (-0.1%) underperforms. Bank of England Chief Economist Pill said that there is a potential for a rate hike in November and that inflation in the U.K. could exceed 5.0%. Riksbank Deputy Governor warned that even a temporary spike in prices could increase expectations for future inflation. L'Oreal beat Q3 expectations while Renault reported lower sales but reaffirmed its operating margin target for the full year.

  • In economic data:

    • Eurozone's flash October Manufacturing PMI 58.5 (expected 57.0; last 58.6) and flash Services PMI 54.7 (expected 55.5; last 56.4)

    • Germany's flash October Manufacturing PMI 58.2 (expected 56.5; last 58.4) and flash Services PMI 52.4 (expected 55.0; last 56.2)

    • U.K.'s flash October Manufacturing PMI 57.7 (expected 55.8; last 57.1) and flash Services PMI 58.0 (expected 54.5; last 55.4). September Retail Sales -0.2% m/m (expected 0.5%; last -0.6%); -1.3% yr/yr (expected -0.4%; last -0.2%). September Core Retail Sales -0.6% m/m (expected 0.2%; last -1.2%); -2.6% yr/yr (expected -1.7%; last -0.9%)

    • France's flash October Manufacturing PMI 53.5 (expected 54.0; last 55.0) and flash Services PMI 56.6 (expected 55.5; last 56.2)


---Equity Markets---

  • STOXX Europe 600: +0.7% (+0.8% week-to-date)

  • Germany's DAX: +0.9% (+0.1% week-to-date)

  • U.K.'s FTSE 100: +0.5% (-0.1% week-to-date)

  • France's CAC 40: +1.1% (+0.4% week-to-date)

  • Italy's FTSE MIB: +0.5% (+0.6% week-to-date)

  • Spain's IBEX 35: -0.1% (-0.7% week-to-date)

---FX---

  • EUR/USD: +0.1% to 1.1641

  • GBP/USD: UNCH at 1.3796

  • USD/CHF: -0.2% to 0.9162


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