There were no U.S. prints on Monday. Japanese and Canadian banks were closed. Chinese banks are open again after their “golden week” holiday. Note, the bond market was closed in observance of Columbus Day. Yen continues to remain bid against the Dollar due to continued risk-aversion, fuelled by trade war rhetoric and Italian government politics. USDJPY down -0.52%, $113.12.
German Industrial Production m/m came in at -0.3% vs expected 0.4%. Italian government bond yields surged to over 4-year highs, with Italian Salvini pointing a finger on Brussels for the bond sell-off and Deputy PM Di Maio claiming that anti-austerity views will grow stronger across the continent. Euro down -0.26%, $1.1494. The optimism about the EU offering a “super-charged” free-trade deal faded on comments from UK PM May’s spokesman, who said that there is a big difference between optimistic talks and a done deal and that there can’t be no withdrawal agreement without a price future framework. Additionally, it was reported that US Brexit Secretary Raab won’t be heading to Brussels this week. Sterling down -0.26%, $1.3093.
S&P 500 down -0.04%, 2,884.43. Nasdaq down -0.62%, 7,352.82. Nikkei down -0.48%, 23,553.0.
Concerning headlines overseas weighed on U.S. markets early. In China, Secretary of State Mike Pompeo traded jabs with China’s foreign minister, Wang Yi, regarding trade disputes. Yi accused the United States of meddling with domestic affairs, and Pompeo retorted that the two simply had a “fundamental disagreement.” In Italy, the government continued its feud with the European Union over its budget deficit plan, with Italy’s Deputy Minister Matteo Salvini referring to two EU leaders as “enemies of Europe.”
In corporate news, Google’s parent company Alphabet (GOOG 1148.97, -8.38) announced that account information of 500,000 of its users was exposed due to a bug, and General Electric (GE 13.61, +0.43) was upgraded to ‘Overweight’ from ‘Equal Weight’ at Barclays. Alphabet shares lost -0.7%, while GE shares climbed 3.3%.
