Monthly Archives: October 2019

Market Insights 10/31/2019

U.S. equities ended lower, with the S&P 500 Index retreating from its all-time high.

Chinese business activity data was again soft and domestic regional manufacturing output unexpectedly dropped, ahead of tomorrow’s key U.S. non-farm payroll and national manufacturing reports.

Treasury yields were lower, along with the U.S. dollar and crude oil prices, while gold was higher.

The Markets…

The Dow Jones Industrial Average fell 140 points (0.5%) to 27,046

The S&P 500 Index lost 9 points (0.3%) to 3,038

The Nasdaq Composite decreased 12 points (0.1%) to 8,292

In heavy volume, 1.1 billion shares were traded on the NYSE and 2.2 billion shares changed hands on the Nasdaq

WTI crude oil fell $0.88 to $54.18 per barrel and wholesale gasoline was down $0.03 at $1.59 per gallon

The Bloomberg gold spot price was $15.88 higher at $1,511.54 per ounce

The Dollar Index—a comparison of the U.S. dollar to six major world currencies—declined 0.4% to 97.31

Personal income and spending rise, along with jobless claims, regional manufacturing falls

Personal income rose 0.3% month-over-month in September, matching the Bloomberg forecast, and versus August’s upwardly-revised 0.5% rise. Personal spending increased 0.2%, just shy of estimates of a 0.3% increase, and following August’s favorably-revised 0.2% gain.

Weekly initial jobless claims grew by 5,000 to 218,000, versus estimates of 215,000, with the prior week’s figure being revised higher by 1,000 to 213,000. The four-week moving average dipped by 500 to 214,750, while continuing claims increased by 7,000 to 1,690,000, north of estimates of 1,679,000.

Treasuries were higher, as the yields on the 2-year and 10-year notes, along with the 30-year bond, dropped 10 bps to 1.52%, 1.70% and 2.18%, respectively.

The Chicago PMI unexpectedly fell further into a level depicting contraction (a reading below 50), dropping to 43.2 in October from September’s 47.1 level and compared to expectations of a slight improvement to 48.0. The index posted the fourth month of contraction in five and hit the lowest level since December 2015, as new orders, production, order backlog and employment all declined.

Europe and Asia mixed on data, trade and monetary policy developments

European equities finished mixed, as U.S.-China trade uncertainty flared back up after a Bloomberg report suggested the latter was doubting a long-term comprehensive deal, while the markets also digested yesterday’s third rate cut of the year out of the U.S. and today’s unchanged stance out of Japan.

The markets also sifted through a host of data, which included a softer-than-expected September m/m retail sales report from Germany and a much worse-than-expected read on U.S. regional manufacturing activity, as well as a slightly stronger-than-expected Q3 GDP report for the Eurozone. The euro dipped and the British pound gained ground versus the U.S. dollar, while bond yields in the region were lower.

Stocks in Asia finished mixed, with trade uncertainty resurfacing somewhat following a report from Bloomberg that China is casting doubt about a long-term comprehensive trade deal with the U.S. but that progress on a phase-one agreement continues. Also, the markets digested the third rate cut this year out of the U.S., which included a signal that it may pause for a bit, while the Bank of Japan kept its policy stance unchanged but hinted that a rate cut could be in the offing.

Economic growth concerns also weighed on China, after the country’s official Manufacturing and non-Manufacturing PMIs for this month showed the former unexpected contracted further and the latter’s growth slowed more than expected.

Stocks in Japan moved higher, with the yen firming slightly, as the Bank of Japan’s decision was accompanied by a larger-than-expected rise in the nation’s industrial production for September.

Company and Earnings News…

Apple reported fiscal Q4 earnings-per-share of $3.03, above the $2.83 FactSet estimate, as revenues rose 2.0% year-over-year to $64.0 billion, exceeding the Street’s expectation of $63.0 billion. The company’s iPhone, wearables, and services revenues all topped projections, while its iPad sales matched forecasts and its Mac sales came in south of estimates. Apple issued Q1 revenue guidance—the key holiday shopping season—that had a midpoint north of expectations.

Facebook posted Q3 EPS of $2.12, above the projected $1.91, with revenues growing 29.0% y/y to $17.7 billion, topping the expected $17.4 billion. The social network’s daily and monthly active users both matched expectations, while its advertising revenues bested estimates.

Starbucks announced fiscal Q4 earnings of $0.67 per share, or $0.70 ex-items, versus expectations of $0.70, as revenues rose 7.0% y/y to $6.8 billion, exceeding the $6.7 billion that was expected. Global same-store sales increased 5.0% y/y, exceeding the estimated 4.0% gain. SBUX issued 2020 EPS and revenue guidance that was just shy of estimates, while announcing a 14.0% increase of its quarterly dividend to $0.41 per share.

Kraft Heinz reported Q3 profits of $0.69 per share, compared to the estimated $0.53, as revenues declined 4.8% y/y to $6.1 billion, roughly in line with forecasts, reflecting negative impacts from divestitures and currency, while its organic sales dipped—but came in above estimates—as increased pricing in the U.S. and other international segments more than offset lower pricing in Canada.

Market Insights 10/30/2019

U.S. equities finished higher as widely expected, the Federal Open Market Committee cut the target for its fed funds rate, marking its third such move this year.

Treasury yields were lower, along with crude oil prices, while gold was higher and the U.S. dollar dipped.

The Markets…

The Dow Jones Industrial Average rose 115 points (0.4%) to 27,187

The S&P 500 Index gained 10 points (0.3%) lower to 3,047

The Nasdaq Composite increased 27 points (0.6%) to 8,304

In moderate volume, 833 million shares were traded on the NYSE and 1.9 billion shares changed hands on the Nasdaq

WTI crude oil fell $0.48 to $55.06 per barrel and wholesale gasoline was down $0.02 at $1.62 per gallon

The Bloomberg gold spot price was $7.55 higher at $1,495.27 per ounce

The Dollar Index—a comparison of the U.S. dollar to six major world currencies—declined 0.2% to 97.51

Fed cuts rates, but hints at pause ahead, Q3 GDP and ADP’s job report top forecasts

At 2:00 p.m. ET, the Federal Open Market Committee (FOMC) concluded its two-day monetary policy meeting, announcing a 25 basis point (.25%) reduction to its target range for the Fed funds rate to 1.50%-1.75%. The move was widely expected and the third cut this year, in what Chairman Jerome Powell had dubbed a “mid-cycle adjustment”, as opposed to any sort of a rate-cutting series. Of note, the FOMC removed a key phrase in the language of its statement of its commitment to “act as appropriate to sustain the expansion.”

The first look (of three) at Q3 Gross Domestic Product (chart), the broadest measure of economic output, showed a quarter-over-quarter annualized rate of expansion of 1.9%, after the unrevised 2.0% expansion in Q2, and above the 1.6% growth forecasted by Bloomberg. Personal consumption gained 2.9%, north of forecasts of a 2.6% rise, and following the unadjusted 4.6% increase recorded in Q2.

Along with personal consumption, the stronger-than-expected GDP growth reflected positive contributions from federal government spending, residential fixed investment, state and local government spending, and exports that were partly offset by negative contributions from nonresidential fixed investment and private inventory investment, as well as an increase in imports.

On inflation, the GDP Price Index came in at a 1.7% rise, below expectations of a 1.9% gain and the unrevised 2.4% increase seen in Q2, while the core PCE Index, which excludes food and energy, moved 2.2% higher, in line with expectations, and following the unadjusted 1.9% advance in Q2.

The ADP Employment Change Report showed private sector payrolls rose by 125,000 jobs in October, above forecasts of a 110,000 gain, while September’s increase of 135,000 jobs was revised to a 93,000 rise. Today’s ADP data, which does not include government hiring and firing, comes ahead of Friday’s broader October non-farm payroll report, expected to show jobs grew by 85,000 and private sector payrolls rose by 80,000 (economic calendar). The unemployment rate is forecasted to tick higher to 3.6% from 3.5% and average hourly earnings are projected to rise 0.3% month-over-month (m/m), and be up 3.0% y/y.

Treasuries were higher, as the yield on the 2-year note declined 4 bps to 1.60%, the yield on the 10-year note decreased 6 bps to 1.77%, and the 30-year bond rate fell 8 bps to 2.25%.

Tomorrow’s economic docket will provide investors a look at weekly initial jobless claims, forecasted to rise 4,000 to 216,000, as well as personal income and spending for September, with economists projecting a 0.3% m/m rise for both measures, and rounding out with the Chicago Purchasing Managers Index, expected to rise to a level of 48.2 for October from the prior month’s 47.1.

Europe mixed on banking earnings and ahead of Fed decision, Asia lower

European equities were mixed, with investors digesting a host of earnings reports from the banking sector, while appearing somewhat cautious ahead of today’s monetary policy decision from the Fed in the U.S. The decision comes amid signs of slowing global growth, the lack of inflation pressures and progress on the U.S.-China trade front. The euro was flat versus the U.S. dollar and bond yields in the region were mostly lower.

Brexit remained in focus after yesterday’s call for a third election since 2015 by Prime Minister Boris Johnson was approved and set for December 12th, after which Johnson’s new Brexit deal will likely be debated in Parliament. The Brexit developments recently have dampened the prospect of a worst-case scenario of a no-deal divorce from the European Union. The British pound gained modest ground on the greenback.

Stocks in Asia finished mostly to the downside, with lingering optimism of a U.S.-China trade deal being countered by some caution ahead of today’s monetary policy decision out of the U.S., which will be followed by tomorrow’s policy announcement from the Bank of Japan. Japanese equities declined, with the yen firming slightly in the wake of a much stronger-than-expected rise in the nation’s retail sales for September, which came ahead of the country’s implementation of a tax hike that began in October.

Stocks in mainland China and Hong Kong traded to the downside, while those traded in Australia dropped, with a read on the nation’s consumer price inflation slowing slightly as expected in Q3. Shares in South Korea declined ahead of some key earnings data, but markets in India advanced amid lingering upbeat sentiment regarding corporate earnings and as reports that suggested the government was considering scrapping a proposed dividend tax also aided sentiment.

Earnings and Company News…

Amgen reported Q3 earnings-per-share of $3.27, or $3.66 ex-items, versus the $3.53 FactSet estimate, as revenues declined 3.0% year-over-year (y/y), reflecting the impact of bio-similar and generic competition against key products, to $5.7 billion, above the projected $5.6 billion. The company noted that many of its medicines delivered double-digit, volume-driven growth. AMGN raised its full-year EPS guidance and issued a revenue outlook for the year that was above expectations.

General Electric posted a Q3 loss of $0.15 per share, or EPS of $0.15 ex-items, compared to the forecasted $0.12, with revenues flat y/y at $23.4 billion. The company noted that it is encouraged by our strong backlog, organic growth, margin expansion, and positive cash trajectory amidst global macro uncertainty. GE reaffirmed its full-year revenue and margin guidance for its industrial segment, but raised its free cash flow outlook for the unit. Shares rallied over 10%.

Yum Brands announced Q3 profits of $0.81 per share, or $0.80 ex-items, compared to the estimated $0.96, with revenues declining 4.0% y/y to $1.3 billion, roughly in line with forecasts. Q3 same-store rose 3.0% y/y, versus the expected 3.2% gain, with sales at Taco Bell stronger than expected, but sales at KFC and Pizza Hut coming in slightly below forecasts. Shares fell sharply.

Market Insights 10/29/2019

U.S. equities lost steam late in the day to finish lower as investors perused a flood of earnings reports.

Optimism of progress on the U.S.-China trade front continued and the prospect of a worst-case Brexit scenario was dampened further as a third election since 2015 for the U.K. looks to be in the offing.

The Markets…

The Dow Jones Industrial Average lost 19 points (0.1%) to 27,071

The S&P 500 Index ticked 3 points (0.1%) lower to 3,037

The Nasdaq Composite declined 49 points (0.6%) to 8,277

In moderate volume, 802 million shares were traded on the NYSE and 1.8 billion shares changed hands on the Nasdaq

WTI crude oil fell $0.27 to $55.54 per barrel and wholesale gasoline was up $0.01 at $1.64 per gallon

The Bloomberg gold spot price was $3.68 lower at $1,488.83 per ounce

The Dollar Index—a comparison of the U.S. dollar to six major world currencies—declined 0.1% to 97.70

Consumer Confidence unexpectedly slips

The Consumer Confidence Index fell to 125.9 in October, from September’s upwardly-revised 126.3 level, and below the Bloomberg estimate of 128.0. On employment, the labor differential—consumers’ appraisal of jobs being “plentiful” minus being “hard to get”—rose to 35.1 from the 33.5 level posted in September.

Pending home sales rose 1.5% month-over-month in September, versus projections of a 0.9% gain, and following the downward-revised 1.4% rise registered in August. Sales were 6.3% higher y/y, compared to the expected 3.6% rise.

Treasuries were modestly higher, as the yields on the 2-year and 10-year notes, along with the 30-year bond, were down 2 basis points (bps) at 1.64%, 1.83% and 2.33%, respectively.

Tomorrow’s domestic economic calendar investors will also get the first look (at three) at Gross Domestic Product (GDP), the broadest measure of economic output, with economists projecting a quarter-over-quarter annualized rate of growth of 1.5% after Q2′s 2.0% q/q gain.

The main event will likely be the afternoon conclusion of the Federal Open Market Committee’s (FOMC) two-day monetary policy meeting. The FOMC is expected by many economists to deliver a 25 bp (.25%) reduction to its target for the fed funds rate. The press conference following the decision is set to be highly scrutinized with the markets looking to see if another cut is in the offing for this year.

Europe and Asia mixed as earnings remains in focus, worst-case Brexit concerns dampened

European equities overcame some early losses and finished mixed, with the global markets continuing to be optimistic regarding the trade progress between the U.S. and China, while the prospect of a worst-case no-deal Brexit was further suppressed. As well, some caution may have prevailed ahead of this week’s monetary policy decision out of the U.S.

U.K. Prime Minister Boris Johnson continued to try to get his new Brexit plan implemented while his push for a third general election since 2015 appeared to be gaining momentum, after suffering a series of setbacks in Parliament, as the opposition Labour Party reversed course and backed Johnson’s call for an election. A snap election is set for between December 9th and 12th but as of yet the date has not been confirmed in Parliament. Johnson has agreed to shelve his Brexit bill until after the election and comes as the European Union granted the U.K. a three-month extension to reach a deal.

Stocks in Asia finished mixed with the markets continuing to be buoyed by progress on the U.S.-China trade front, while caution may have set in ahead of this week’s monetary policy decisions out of the U.S. and Japan. Japanese equities gained ground, with the yen moving lower, while a report showed consumer price inflation out of Tokyo came in cooler than expected for this month.

Stocks in both mainland China and Hong Kong declined, Australian securities ticked higher and those traded in South Korea finished flat.

Company and Earnings News….

Alphabet reported Q3 earnings-per-share (EPS) of $10.12, below the $12.32 FactSet estimate, as revenues rose 20.0% year-over-year to $40.5 billion, topping the expected $40.3 billion. The company’s traffic acquisition costs (TAC) came in at $7.5 billion, roughly in line with forecasts. The company’s paid clicks rose 18.0% y/y, while its cost per click declined 2.0%.

Pfizer posted Q3 EPS of $1.36, or $0.75 ex-items, versus the projected $0.62, as revenues declined 5.0% y/y to $12.7 billion, above the expected $12.3 billion. The company raised its full-year profit outlook and narrowed its revenue forecast.

Merck announced Q3 earnings of $0.74 per share, or $1.51 ex-items, compared to the expected $1.24, as revenues grew 15.0% y/y to $12.4 billion, exceeding the estimated $11.7 billion. MRK raised its full-year guidance.

General Motors reported Q3 EPS of $1.60, or $1.72 ex-items, compared to the forecasted $1.38, as revenues dipped 0.9% y/y to $35.5 billion, topping the estimated $35.0 billion. The automaker trimmed its full-year earnings outlook, reflecting capital expenditures that are expected to be lower than expected and the negative impact of the work stoppage in the U.S.

Grubhub tumbled over 40% after the food delivery company’s Q3 revenues of $322 million, missed the Street’s expectations of $330 million, and its Q4 revenue forecast was decisively below estimates. The company noted that supply innovations in online takeout have been played out and annual growth is slowing, while competition is intensifying. GRUB’s Q3 EPS of $0.27 ex-items were in line with forecasts.

Market Insights 10/28/2019

U.S. equities finished higher, with the S$P 500 notching another record high, as optimism of a U.S.-China trade deal continued to lend support to equity markets.

Treasury yields were higher, while crude oil prices, gold and the U.S. dollar were lower.

The Markets…

The Dow Jones Industrial Average increased 133 points (0.5%) to 27,091

The S&P 500 Index gained 17 points (0.4%) to 3,039

The Nasdaq Composite advanced 83 points (1.0%) to 8,326

In moderate volume, 771 million shares were traded on the NYSE and 1.9 billion shares changed hands on the Nasdaq

WTI crude oil fell $0.85 to $55.81 per barrel and wholesale gasoline was down $0.01 at $1.63 per gallon

The Bloomberg gold spot price was $12.10 lower at $1,492.53 per ounce

The Dollar Index—a comparison of the U.S. dollar to six major world currencies—declined 0.1% to 97.73

Trade deficit narrows, regional manufacturing activity falls into contraction

The advance goods trade balance showed that the September deficit unexpectedly narrowed, coming in at $70.4 billion versus the Bloomberg estimate of $73.5 billion. August’s deficit was revised higher to $73.1 billion.

Preliminary wholesale inventories declined 0.3% month-over-month for September, compared to expectations of a 0.2% gain, and versus August’s negatively-revised flat reading.

The October Dallas Fed Manufacturing Index surprisingly fell to a level depicting contraction (a reading below zero), dropping to -5.1 from 1.5 in September, and versus expectations of a decline to 1.0.

Treasuries were lower, as the yield on the 2-year note rose 2 basis points to 1.65%, while the yields on the 10-year note and the 30-year bond increased 5 bps to 1.84% and 2.34%, respectively.

Europe and Asia higher with trade and Brexit developments lending support

European equities finished higher, with the markets awaiting monetary policy decisions out of the U.S. and Japan, while U.S.-China trade optimism lingered and some earnings and latest U.K. Brexit developments were in focus. U.K. Brexit was again in the spotlight after the European Union granted the region a three-month extension to finalize a divorce agreement, and Parliament rejected Boris Johnson’s call for early elections. The euro and British pound ticked higher versus the U.S. dollar, while bond yields in the region were mostly higher.

Stocks in Asia finished higher, with reports suggesting that the U.S. and China are close to finalizing a phase-one trade deal supporting sentiment, while the markets await this week’s monetary policy decisions out of the U.S. and Japan. Markets in mainland China and Hong Kong rose, even as China’s industrial profits declined in September, and stocks in Japan moved to the upside, with the yen choppy ahead of the Bank of Japan’s policy decision later this week. Australian equities finished flat and South Korean securities advanced, while markets in India were closed for a holiday.

Company and Earnings News…

AT&T reported Q3 earnings-per-share of $0.50, or $0.94 ex-items, versus the $0.93 FactSet estimate, with revenues declining 2.4% year-over-year (y/y) to $44.6 billion, below the estimated $45.1 billion. The company’s mobility unit’s net subscriber additions came in above expectations, while its video and broadband missed expectations. As part of its three-year plan, T issued fiscal 2020 EPS guidance with a midpoint that was above projections, and its capital allocation initiatives were met with support from activist investor Elliott Management Corporation, which manages funds that collectively own $3.4 billion in common stock and economic equivalents of AT&T. Shares were higher.

Walgreens posted fiscal Q4 EPS of $0.75, or $1.43 ex-items, versus the projected $1.41, as revenues rose 1.5% y/y to $34.0 billion, above the expected $33.9 billion. The company noted a challenging operating environment, but said its 2020 EPS outlook is expected to be in line with its expectations. Shares were lower.

General Motors was in focus amid reports that the United Auto Workers (UAW) announced that it has voted to end its 40-day strike after ratifying a new four-year labor contract with GM, now the UAW is reportedly set to begin negotiations with Ford Motor Company and Fiat Chrysler Automobiles N.V. Shares of GM were lower.

Tiffany & Co. surged over 30% after confirming that it has received a takeover offer from luxury goods maker LVMH Moet Hennessy Louis Vuitton SE for $120 per share in cash, or about $14.5 billion. TIF noted that while the parties are not in discussions, it is reviewing the proposal to determine the course of action it believes is in the best interests of the company and its shareholders.

Market Insights 10/25/2019

U.S. equities finished the last trading session of the week higher, with the S&P 500 again flirting with record territory, and as the major indexes notched a third-straight weekly advance.

The equity markets were able to overcome early losses that came on the heels of Amazon’s profit miss and softer-than-expected outlook for the holiday season, with stocks getting a boost in afternoon action after reports that the U.S. and China are close to finalizing some sections of the “Phase-1″ trade deal following a telephone conversation between the two nation’s trade representatives.

Treasury yields and the U.S. dollar were higher, with consumer sentiment improving versus last month, while crude oil and gold prices gained slight ground.

The Markets…

The Dow Jones Industrial Average increased 153 points (0.6%) to 26,958

The S&P 500 Index added 12 points (0.4%) to 3,022

The Nasdaq Composite picked up 57 points (0.7%) to 8,243

In moderate volume, 770 million shares were traded on the NYSE and 1.9 billion shares changed hands on the Nasdaq

WTI crude oil moved $0.43 higher to $56.66 per barrel and wholesale gasoline was up $0.01 at $1.64 per gallon

The Bloomberg gold spot price was $1.66 higher at $1,505.64 per ounce

The Dollar Index—a comparison of the U.S. dollar to six major world currencies— rose 0.2% to 97.85

Markets were higher for the week, as the DJIA gained 0.8%, the S&P 500 Index advanced 1.3% and the Nasdaq Composite increased 1.9%

Consumers feel better in October versus September

The final October University of Michigan Consumer Sentiment Index was adjusted slightly lower to 95.5, from the preliminary figure of 96.0, where the Bloomberg estimate had expected it to remain. However, the index was above September’s 93.2 level and moved further away from the near three-year low posted in August. Both the current conditions and expectations components of the index were revised slightly lower but improved compared to the prior month. The 1-year inflation forecast fell to 2.5% from September’s 2.8% rate, and the 5-10 year inflation outlook dipped to 2.3% from 2.4%.

Treasuries were lower, with the yields on the 2-year and 10-year notes rising 5 basis points to 1.63% and 1.80%, respectively, while the 30-year bond rate was 2 bps higher at 2.28%.

The markets continued to focus on the ramp-up in Q3 earnings season, which has taken some of the focus off the recent progress from the U.S.-China and Brexit fronts. However, the markets received a boost in afternoon action after reports that the world’s two largest economies are close to finalizing some sections of the “Phase-1″ trade deal.

Europe and Asia mostly higher on trade optimism, despite mixed data and Brexit concerns

European equities finished mostly higher, getting a boost late in the day from some upbeat trade news, and as a host of divergent earnings reports on both sides of the pond were scrutinized, as well as the latest developments on the Brexit front, along with some mixed reads on German confidence.

On the Brexit front, after gaining approval in principal of his new deal to break away from the European Union (EU) earlier this week that appeared to ease concerns about the worst case scenario of a no-deal divorce, Prime Minister Boris Johnson’s push for a December 12th general election seems to be causing uncertainty to resurface ahead of an October 31st deadline. This comes as EU lawmakers agreed in principal to grant the U.K. an extension but have not decided on the duration of the postponement. German data was mixed, with consumer confidence unexpectedly dipping for November, while the Ifo’s business confidence report for this month showed the assessment of the current situation came in below forecasts though the expectations component improved more than expected.

Stocks in Asia finished mostly higher to end the week, with the markets continuing to hold onto hope of a U.S.-China trade deal as high-level phone discussions were set for today and were completed after the markets in Asia closed, while yesterday’s speech from U.S. Vice President Pence appeared not to derail progress despite some mixed reactions to his comments. The markets continued to digest the flood of mixed global earnings reports, while eyeing the latest Brexit developments and the European Central Bank’s unchanged monetary policy decision yesterday.

Stocks in Japan rose, with the yen choppy, while South Korean securities ticked only slightly higher, amid lingering optimism out of the semiconductor sector following mostly upbeat quarterly results in the region and U.S. recently.

Mainland Chinese equities moved to the upside, but those traded in Hong Kong declined amid the continued political unrest and following yesterday’s larger-than-expected drop in Hong Kong exports.

Stocks counter string of losses with streak of gains

U.S. stocks posted a third-straight weekly gain to follow a three-week losing streak, continuing 2019′s theme of heightened volatility but little headway. The S&P 500 Index moved back into record high territory, with the recent trade truce between U.S. and China keeping fears of escalation in check, while the risk of a worst case scenario of a no-deal Brexit was suppressed by this week’s developments in the U.K. Stocks shrugged off further signs of a global economic slowdown, with another dose of soft manufacturing reports out of the Eurozone and Japan, along with a sharp drop in South Korean exports.

The headline economic event that has the most potential to move the markets could be the midweek monetary policy decision from the Federal Open Market Committee (FOMC). Even though the decision will not include updated economic projections and there has been some progress on the U.S.-China trade front, the FOMC is still expected to deliver a 25 bp reduction to its target for the fed funds rate. The press conference following the decision is set to be highly scrutinized with the markets looking to see if another cut is in the offing for this year.

Although earnings season will continue to command attention next week, with the technology sector taking center stage, some of the spotlight is likely to be shared with a fully-loaded economic docket. Consumer Confidence will get ball rolling, picked-up by the first read (of three) on Q3 GDP, personal income and spending, and jobless claims, to set the stage for Friday’s key October non-farm payroll report and the ISM Manufacturing Index.

Company and Earnings News

Amazon.com Inc reported Q3 earnings-per-share of $4.23, below the $4.59 FactSet estimate, as revenues grew 24.0% year-over-year to $70.0 billion, north of the Street’s projection of $68.8 billion. Operating income from its North American and Amazon Web Services (AWS) segments came in below estimates, while the shortfall in its international segment was much smaller than expected. Revenues out of its North American and international units exceeded forecasts, though its AWS sales came in slightly below projections. The company issued revenue and operating income guidance for Q4—the key holiday shopping season—that missed expectations, noting that it is expecting to invest heavily to ramp up for the holiday season, bolstering its free one-day delivery, growing its cloud business and expanding its warehouse footprint and product selection. Shares were lower but off the worst levels of the day.

Intel posted Q3 EPS of $1.35, or $1.42 ex-items, versus the projected $1.23, with revenues roughly flat y/y at $19.2 billion, north of the forecasted $18.1 billion. The chipmaker said its Q3 performance underscores its progress as its datacentric businesses turned in their best performance ever, making up almost half of its total revenue. Intel issued Q4 guidance that exceeded estimates and raised its full-year outlook. Shares rallied.

Verizon Communications announced Q3 earnings of $1.25 per share, compared to the forecasted $1.24, as revenues increased 0.9% y/y to $32.9 billion, exceeding the expected $32.8 billion. The company noted higher wireless service revenue, which was partially offset by lower wireless equipment revenue and declines in legacy wire-line revenue, predominantly in the business segment. VZ reaffirmed its full-year outlook. Shares were slightly lower.

Visa reported fiscal Q4 EPS of $1.34, or $1.47 ex-items, compared to the expected $1.43, with revenues rising 13.0% y/y to $6.1 billion, roughly in line with forecasts. Payments, cross-border and processed transactions volumes all increased y/y. V issued full-year guidance that mostly matched estimates. Shares were higher.

Market Insights 10/24/2019

U.S. equities finished mixed, as investors were treated to a host of data to ponder.

Recent progress on the U.S.-China trade war and U.K. Brexit took a back seat to a flood of diverging data points from the economic and earnings fronts.

Treasury yields finished slightly higher, while the U.S. dollar, gold and crude oil prices also gained ground.

The Markets…

The Dow Jones Industrial Average lost 29 points (0.1%) to 26,805

The S&P 500 Index inched 6 points (0.2%) higher to 3,010

The Nasdaq Composite rose 66 points (0.8%) to 8,186

In moderate volume, 803 million shares were traded on the NYSE and 1.8 billion shares changed hands on the Nasdaq

WTI crude oil moved $0.26 higher to $56.23 per barrel and wholesale gasoline was up $0.02 at $1.63 per gallon

The Bloomberg gold spot price advanced $10.03 to $1,502.15 per ounce

The Dollar Index—a comparison of the U.S. dollar to six major world currencies— was up 0.2% at 97.66

Durable goods orders miss, jobless claims dip, manufacturing and services growth ticks higher

September preliminary durable goods orders fell 1.1% month-over-month, compared to the Bloomberg estimate of a 0.7% decline and August’s upwardly-revised 0.3% gain. Ex-transportation, orders decreased 0.3% m/m, versus forecasts of a 0.2% decline and compared to August’s downward-adjusted 0.3% increase.

The preliminary Markit U.S. Manufacturing PMI Index for October unexpectedly increased to 51.5 from September’s unrevised 51.1 figure, and versus expectations of a dip to 50.9. The preliminary Markit U.S. Services PMI Index showed growth also accelerated slightly for the key U.S. sector this month, rising to 51.0 from September’s 50.9 figure, matching forecasts. A reading above 50 for both indexes denotes expansion.

Weekly initial jobless claims declined by 6,000 to 212,000, versus estimates of 215,000, with the prior week’s figure being revised higher by 4,000 to 218,000. The four-week moving average dipped by 750 to 215,000, while continuing claims slipped by 1,000 to 1,682,000, north of estimates of 1,678,000.

New home sales declined 0.7% m/m in September to an annual rate of 701,000 units, versus forecasts calling for 702,000 units and south of August’s downward-revised 706,000 unit pace. The median home price was down 8.8% y/y at $299,400. New home inventory remained at a 5.5 months of supply at the current sales pace. Sales were lower m/m in the Northeast, South and West, but rose in the Midwest. Compared to the last year, sales are solidly higher across all the regions, except in the Midwest, which are down solidly.

Treasuries were slightly lower, as the yields on the 2-year and 10-year notes, along with the 30-year bond, ticked 1 basis point higher to 1.58%, 1.77% and 2.26%, respectively.

Rounding out the week’s domestic economic calendar tomorrow will be the final read on the October University of Michigan Consumer Sentiment Index, with economists projecting a reading of 95.8 versus the preliminary read of 96.0, but above the 93.2 posted the month prior.

Europe and Asia higher despite data, as ECB holds and Brexit continued to garner attention

European equities finished higher, despite some disappointing economic and earnings data on this side of the pond, which was met with the flood of mixed data out of the U.S. Also, the markets showed little reaction to the unchanged monetary policy decision from the European Central Bank (ECB), which was expected after its previous decision in September delivered the restart of its quantitative easing campaign and a lowered deposit facility rate to -0.50%.

The markets also eyed outgoing ECB President Mario Draghi’s final press conference as the head of the central bank, in which he noted that weaker growth momentum is stymieing inflation from reaching its target and that risks to its outlook are on the downside, adding his continued call for fiscal policy support.

U.K. Brexit continued to garner attention after this week’s approval in principal of Prime Minister Boris Johnson’s new divorce plan, which was followed by a denial by parliament to expedite implementation of the plan before the October 31st deadline. All eyes are now on the European Union (EU), which is expected to meet tomorrow and decide on whether to grant the U.K. an extension to debate Johnson’s plan before exiting the EU.

Stocks in Asia finished mostly to the upside, with the markets continuing to digest the plethora of earnings and economic data, which have been mixed but appeared to be coming in a bit better than feared. Also, the lingering optimism of some sort of progression on the U.S.-China trade front, while an approved Brexit deal in principal this week continues to cool concerns about a worst-case scenario of a no-deal divorce from the European Union. Stocks in Japan advanced, with the yen holding onto yesterday’s weakness, and despite the nation’s Manufacturing PMI report that showed the contraction in the sector accelerated slightly in October.

Chinese equities finished little changed and those traded in Hong Kong advanced, ahead of a report after the closing bell that showed Hong Kong’s exports fell slightly more than expected in September.

Company and Earnings News

3M reported Q3 earnings-per-share (EPS) of $2.58, excluding a $0.14 divestiture gain, versus the $2.49 FactSet estimate, as revenues declined 2.0% year-over-year (y/y) to $8.0 billion, below the Street’s projection of $8.2 billion. MMM issued Q4 EPS guidance that was below expectations. Shares were lower.

Dow component Microsoft posted fiscal Q1 EPS of $1.38, above the forecasted $1.25, with revenues rising 14.0% y/y to $33.1 billion, topping the estimated $32.2 billion. The company said it was a strong start to the fiscal year with its commercial cloud business seeing revenues jump 36.0% y/y. Shares were higher.

Dow member Dow announced Q3 EPS of $0.45, or $0.91 ex-items, compared to the expected $0.72, as revenues fell 15.0% y/y—due to lower local prices primarily due to declines in global energy prices—to $10.8 billion, exceeding the forecasted $10.7 billion. The company said volume declined 2.0% y/y, while demand growth in packaging, polyurethanes and silicone applications was more than offset by lower hydrocarbon co-product sales. Shares rose.

Ford Motor Co reported Q3 earnings of $0.11 per share, or $0.34 ex-items, versus the expected $0.26, as automotive revenues declined 2.0% y/y to $33.9 billion, north of the expected $33.8 billion. The automaker lowered the high end of its full-year earnings outlook, noting Q4 headwinds—higher warranty costs and higher-than-expected planned incentives in North America, and lower volumes in China—have intensified. Shares fell.

Tesla posted a Q3 EPS of $0.80, or $1.86 ex-items, compared to the loss of $0.46 per share that the Street had anticipated, with revenues declining 8.0% y/y to $6.3 billion, versus the expected $6.4 billion. The company noted that its gross margin jumped 22.8% quarter-over-quarter, easily exceeding expectations. Shares rallied over 15%.

Twitter posted Q3 EPS of $0.05, compared to the forecasted $0.20, with revenues rising 9.0% y/y to $824 million, south of the estimated $874 million. The social media company said its monetizable daily active users grew 17.0% y/y. The company issued Q4 revenue guidance that was below expectations. Shares fell more than 20%.

Southwest Airlines announced Q3 EPS of $1.23, above the expected $1.08, as revenues rose 1.1% y/y to $5.6 billion, roughly in line with estimates. The company said despite the challenge of the continued grounding of the Boeing 737 MAX 8 aircraft, it generated record operating and unit revenues, solid margins, and strong cash flows. Shares were nicely higher.

American Airlines Group reported Q3 profits of $0.96 per share, or $1.42 ex-items, versus the forecasted $1.40, as revenues rose 3.0% y/y to $11.9 billion, roughly in line with estimates. The airline lowered the high end of its full-year EPS outlook, noting that with flight cancellations extending through the remainder of 2019 due to the 737 MAX grounding, it expects this will negatively impact it full-year pre-tax income. Shares were noticeably higher.

Cable TV provider Comcast Corporation posted Q3 EPS of $0.70, or $0.79 ex-items, compared to the projected $0.74, as revenues rose 21.2% y/y to $26.8 billion, roughly in line with expectations. Cable revenues topped forecasts, along with its net high-speed internet subscribers, while its NBC Universal revenues mostly matched estimates. Shares were lower.

eBay announced Q3 EPS of $0.37, or $0.67 ex-items, versus the forecasted $0.64, as revenues were roughly flat y/y at $2.7 billion, above the expected $2.6 billion. Q3 gross merchandising volume was down 4.0% y/y and missed expectations, while it issued Q4 guidance that was below projections. Shares finished lower.

Market Insights 10/23/2019

U.S. equities were higher in a rocky session, as lingering U.S.-China trade optimism came up against a slew of mixed quarterly reports, with Q3 earnings season heating up.

Focus on U.K. Brexit developments continued, with the agreement in principal of Prime Minister Boris Johnson’s new divorce plan hitting a roadblock and a key EU extension decision looming.

Treasury yields were mostly lower, crude oil prices and gold were higher, while the U.S. dollar lost ground. News on the economic front was relatively quiet, but mortgage applications fell as rates jumped.

The Markets…

The Dow Jones Industrial Average rose 46 points (0.2%) to 26,834

The S&P 500 Index inched 9 points (0.3%) higher to 3,005

The Nasdaq Composite added 16 points (0.2%) to 8,120

In moderate volume, 763 million shares were traded on the NYSE and 1.8 billion shares changed hands on the Nasdaq

WTI crude oil moved $1.46 higher to $55.97 per barrel and wholesale gasoline was up $0.04 at $1.65 per gallon

The Bloomberg gold spot price advanced $3.91 to $1,491.59 per ounce

The Dollar Index—a comparison of the U.S. dollar to six major world currencies— was down 0.1% at 97.45

Mortgage applications drop as rates jump

The MBA Mortgage Application Index fell 11.9% last week, following the prior week’s 0.5% gain. This snapped a string of three-straight weekly increases as the average 30-year mortgage rate jumped 10 basis points (bps) to 4.02%. As such, the Refinance Index tumbled 17.1% and the Purchase Index fell 3.6%.

Treasuries rose, as the yield on the 2-year note fell 3 bps to 1.58%, while the yield on the 10-year note declined 1 bp to 1.76%, and the 30-year bond rate was flat at 2.25%.

Tomorrow’s domestic economic calendar will be the busiest of the week, and include weekly initial jobless claims, forecasted to rise 3,000 to 217,000, durable goods orders, projected to have fallen 0.8% month-over-month (m/m) during September, with sales ex-transportation expected to have declined 0.2% m/m and non-defense capital goods ex-aircraft to have gained 1.9% m/m.

Europe and Asia diverge on Brexit deal roadblock and earnings

European equities finished mixed, as the markets digested a plethora of global earnings reports. However, U.K. Brexit developments seemed to garner the most attention, after Prime Minister Boris Johnson’s new divorce plan received parliamentary approval in principal, but parliament voted down his attempt to expedite the plan before the October 31st deadline. The ball is now in the European Union’s (EU) court, as it has to decide whether to grant the U.K. an extension of the October deadline, which could lead to another general election.

Stocks in Asia finished mixed, with lingering optimism of progress toward a U.S.-China trade deal supporting sentiment, though the technology sector limited gains in Japan and weighed on the markets, notably South Korea. Also, an approved U.K. Brexit deal that was thwarted by a vote to deny an attempt to expedite the divorce process ahead of the October 31st deadline appeared to cause some market uneasiness.

Stocks in Japan rose, even as the yen climbed, while the nation reported a sharp rise in the nation’s department store sales in September. Chinese equities and those traded in Hong Kong decreased, while markets in Australia finished little changed and shares in India ticked higher, and South Korean listing traded to the downside.

Company and Earnings News

Caterpillar reported Q3 earnings-per-share (EPS) of $2.66, below the $2.90 FactSet estimate, as revenues declined 6.0% year-over-year (y/y) to $12.8 billion, south of the expected $13.4 billion. The company noted that the primary driver of the decline in sales was dealers making inventory reductions due to global economic uncertainty, which it expects to continue in Q4 and be accompanied by flat end-user demand. As such, the company lowered its full-year EPS outlook. However, CAT added that improved lead times, along with these dealer inventory reductions, will enable it to respond quickly to positive or negative developments in the global economy in 2020. Shares were able to overcome early losses and finished higher.

Boeing posted Q3 earnings of $2.05 per share, or $1.45 ex-items, versus the expected $2.07, with revenues falling 21.0% y/y to $20.0 billion, reflecting lower 737 deliveries and higher defense and services volume, above the Street’s forecast of $19.6 billion. The aircraft maker’s Q3 free cash flow fell $2.9 billion and it saw increased costs of $3.6 billion related to its 737 MAX. The company added that it continues to engage global regulators and customers on the safe return to service of the 737 MAX and reaffirmed its outlook for a return to service by the end of Q4. Shares rose.

Chipotle Mexican Grill announced Q3 profits of $3.47 per share, or $3.82 ex-items, compared to the forecasted $3.21, as revenues grew 14.6% y/y to $1.4 billion, roughly in line with expectations. The restaurant chain’s Q3 same-store sales rose 11.0% y/y, north of the estimated 9.3% gain. CMG said it expects full-year same-store sales to be at the high end of its prior guidance. Shares, which have rallied sharply year-to-date, were lower despite the results, with analysts expressing some concerns about tough performance comparisons starting in Q4 and its lowered outlook for restaurant openings.

Texas Instruments reported Q3 EPS of $1.49, including a $0.09 per share benefit for items that were not in the company’s original guidance, making comparisons to the Street’s $1.42 forecast unclear. Revenues decreased 11.0% y/y to $3.8 billion, roughly in line with expectations, with the company noting further weakness in most markets. TXN’s Q4 revenue guidance was below expectations. Shares saw heavy pressure.

Nike announced that Board member John Donahoe will succeed Mark Parker as President and Chief Executive Officer (CEO) in 2020. The company added that at the same time, Mark Parker, CEO since 2006 and Chairman, President & CEO since 2016, will become Executive Chairman and continue to lead the Board of Directors and work closely with Donahoe and the senior management team. Shares were lower.

Random Earnings Observations

The Q3 EPS reporting season has given investors both tricks and treats.

With about 20% of the S&P 500 reporting Q3 results as of 10/22, the S&P 500 is still expected to see a 3.8% drop, year on year, despite impressive results for financials and health care.

As a result, seven of 11 sectors are now projected to post Q3 actuals that surpass end-of-quarter forecasts. On the sub-industry level, conditions are less than inspiring, as 53% saw reductions to Q3 estimates.

Even less encouraging has been the whittling down of 2020 projections, which now point to a 9.6% gain from an earlier forecast of +10.2%, with only 27% of sectors and 33% of sub-industries having benefited from upward revisions.

The S&P 500 remains near all-time highs, however, as investors likely foresee favorable resolutions to global uncertainties, resulting in an anticipated reversal of the declining EPS trend.

Market Insights 10/22/2019

U.S. equities finished lower, losing steam late in the day, after a turn of events in today’s key U.K. Brexit votes created caution surrounding a smooth break from the EU.

Optimism surrounding U.S.-China trade developments continued, while a slew of earnings from Dow members added to the mix, with results conflicting.

Treasury yields were mostly lower, but the U.S. dollar rose, with existing homes sales falling more than expected and regional manufacturing output surprisingly jumping into expansion territory. Gold and crude oil prices were higher.

The Markets…

The Dow Jones Industrial Average fell 40 points (0.2%) to 26,788

The S&P 500 Index decreased 11 points (0.4%) to 2,996

The Nasdaq Composite declined 59 points (0.7%) to 8,104

In light volume, 751 million shares were traded on the NYSE and 1.8 billion shares changed hands on the Nasdaq

WTI crude oil moved $0.97 higher to $54.48 per barrel and wholesale gasoline was unchanged at $1.61 per gallon

The Bloomberg gold spot price advanced $3.56 to $1,488.06 per ounce

The Dollar Index—a comparison of the U.S. dollar to six major world currencies— was up 0.1% at 97.46

Home sales drop more than expected, regional manufacturing jumps back into expansion

Existing-home sales fell 2.2% month-over-month in September to an annual rate of 5.38 million units, compared to the Bloomberg expectation of a decline to 5.45 million units from August’s upwardly-revised 5.50 million rate—which was the highest since March 2018. Sales of single-family homes were down m/m but higher versus year-ago levels, while purchases of condominiums and co-ops rose m/m and y/y. The median existing-home price jumped 5.9% from a year ago to $272,100, marking the 91st straight month of y/y gains.

The Richmond Fed Manufacturing Activity Index for October unexpectedly rose back to a level depicting expansion (a reading above zero), jumping to 8 versus forecasts calling for the figure to improve to -7 from September’s -9 level. New orders, shipments and order backlogs all moved into expansion territory.

Treasuries finished mostly higher, as the yield on the 2-year note was flat at 1.60%, while the yields on the 10-year note and the 30-year bond declined 3 basis points (bps) to 1.77% and 2.25%, respectively.

Europe mixed as earnings, trade and Brexit in focus, Asia mostly higher

European equities finished mixed, with optimism remaining regarding a U.S.-China trade deal and as the global markets digested a host of quarterly results as earnings season ramps up. U.K. Brexit continued to garner heavy attention, as Prime Minister Boris Johnson faced some conflicting parliamentary votes on his new divorce deal after the markets closed, and into the night hours, with an October 31st deadline looming. The euro and British pound lost ground versus the U.S. dollar, while bond yields in the region were lower.

Stocks in Asia finished mostly higher with sentiment being buoyed by lingering optimism of a U.S.-China trade deal and the heated-up earnings season, while volume was lighter than usual as markets in Japan were closed for a holiday.

Stocks in mainland China and Hong Kong advanced, and those traded in South Korea rallied, while Australian securities rose but markets in India fell in a return to action following yesterday’s closure.

Earnings News…

Procter & Gamble reported fiscal Q1 earnings-per-share of $1.36, or $1.37 ex-items, compared to the $1.24 FactSet estimate, with revenues rising 7.0% year-over-year (y/y) to $17.8 billion, above the projected $17.5 billion. PG raised its full-year guidance.

McDonald’s achieved Q3 EPS of $2.11, south of the estimated $2.21, as revenues rose 1.0% y/y to $5.4 billion, below the expected $5.5 billion. Global same-store sales increased 5.9% y/y, versus the projected 5.4% gain, while its U.S. same-store sales increased 4.8%, missing projections.

United Technologies posted Q3 EPS of $1.33, or $2.21 ex-items, versus the expected $2.03, as revenues grew 18.0% y/y to $19.5 billion, north of the forecasted $19.3 billion. The company raised its full-year EPS outlook and narrowed its revenue forecast.

United Parcel Service announced Q3 EPS of $2.01, or $2.07 ex-items, compared to the forecasted $2.06, with revenues increasing 5.0% y/y to $18.3 billion, below the expected $18.4 billion. UPS reaffirmed its full-year earnings outlook.

Travelers reported Q3 profits of $1.50 per share, or $1.43 ex-items, versus the expected $2.35, as net written premiums gaining 7.0% y/y to $7.6 billion, compared to the forecasted $7.0 billion.

Biogen surged over 25% after the company announced plans for a regulatory filing for the approval of its treatment for Alzheimer’s, based on new analysis from recent studies. The news accompanied its Q3 earnings report, in which it posted EPS of $9.17 ex-items, above the projected $8.28, on revenues of $3.6 billion that exceeded the expected $3.5 billion.

Under Armour announced that Patrik Frisk will become the company’s Chief Executive Officer (CEO), replacing CEO and founder Kevin Plank, effective January 1st 2020.

Hasbro announced Q3 EPS of $1.67, or $1.84 ex-items, below the projected $2.21, as revenues were roughly flat y/y at $1.6 billion, south of the expected $1.7 billion. The company said the threat and enactment of tariffs reduced revenues and increased expenses.

Market Insights 10/21/2019

U.S. equities finished higher, as optimism regarding a U.S.-China trade deal continued and Q3 earnings season is set to shift into gear.

The S&P 500 again flirted with record high territory, but gains in the Dow were tempered a bit by Boeing amid the continued scrutiny of company’s troubled 737 MAX airplane.

Treasury yields were higher to extend a recent run amid an empty economic calendar, and the U.S. dollar was flat, while crude oil prices fell, and gold was lower.

The Markets…

The Dow Jones Industrial Average rose 57 points (0.2%) to 26,828

The S&P 500 Index increased 21 points (0.7%) to 3,007

The Nasdaq Composite advanced 73 points (0.9%) to 8,163

In light volume, 754 million shares were traded on the NYSE and 1.7 billion shares changed hands on the Nasdaq

WTI crude oil moved $0.36 lower to $53.51 per barrel and wholesale gasoline was down $0.01 at $1.61 per gallon

The Bloomberg gold spot price declined $7.49 to $1,482.56 per ounce

The Dollar Index—a comparison of the U.S. dollar to six major world currencies— was nearly unchanged at 97.32

Economic front quiet today before a busy week

The economic calendar today is minus of any major releases, but is set to heat up later in the week. Things begin to heat up tomorrow for the docket, with a focus on housing, courtesy of MBA Mortgage Applications, followed by existing home sales, with economists projecting a 0.7% month-over-month decline during September to an annual rate of 5.45 million units following August’s surprising 1.3% m/m jump.

Treasuries were lower, as the yield on the 2-year note was up 4 basis points (bps) to 1.61%, while the yields on the 10-year note and the 30-year bond gained 6 bps to 1.80% and 2.29%, respectively. Bond yields have extended a recent climb and the U.S. dollar has taken a break from a slide as of late, amid the backdrop of the recent progress on the U.S.-China trade negotiations, festering U.K. Brexit uncertainty, persisting global growth concerns and the heating up of earnings season.

Europe and Asia higher as earnings, data, trade and Brexit command attention

European equities finished higher to begin the week, as U.S.-China trade tensions remained relatively in check, and despite continued U.K. Brexit uncertainty. U.K. Prime Minister Boris Johnson was forced to ask the European Union (EU) for an extension to the October 31st Brexit deadline after a parliamentary vote over the weekend delayed an attempt to approve his new divorce deal.

The British pound was modestly higher versus the U.S. dollar in volatile trading. The euro dipped versus the greenback and bond yields in the region gained ground, ahead of this week’s monetary policy decision from the European Central Bank. Global growth concerns also remained following a host of soft manufacturing data, though the ratcheted-up earnings season is set to command attention this week.

Stocks in Asia tilted slightly higher as the markets digest earnings and economic data, while U.K. Brexit developments over the weekend continued to foster uncertainty, though reports noted that China’s Vice Premier Liu said U.S.-China trade talks made “substantial progress.” Japanese equities advanced, with the yen slipping a bit, while the nation posted a larger-than-expected drop in September exports, but the figure was an improvement from the prior month.

Stocks in mainland China ticked higher and those traded in Hong Kong finished little changed, while shares in South Korea traded to the upside, even as the country’s exports fell sharply y/y in October. Australia securities finished nearly unchanged, while markets in India were closed for general assembly elections.