CURRENCY MARKET WRAP
As of Mon Nov 4th, Singapore Time zone UTC+8
U.S. Dollar Index, -0.18%, 97.12
USDJPY, +0.15%, $108.19
EURUSD, +0.13%, $1.1167
GBPUSD, -0.05%, $1.2935
USDCAD, -0.19%, $1.3136
AUDUSD, +0.29%, $0.6914
NZDUSD, +0.23%, $0.6428
U.S. October employment report was adversely impacted by the GM strike but otherwise strong absent the effects of that strike, which led to about 42,000 job losses for the motor vehicle and parts industry. October non-farm payrolls increased by 128,000 (consensus 80,000). There were sizable upward revisions to non-farm payrolls for August and September, fewer discouraged workers, and an uptick in the labor force participation rate. ISM Manufacturing Index for October checked in at 48.3% (consensus 48.7%), up from 47.8% in September but still below the 50.0% level. This was its third straight monthly contraction, but the market’s reaction reflected a better-than-feared perspective.
In trade, China’s Ministry of Commerce said both sides reached a consensus on core issues in a phone call involving senior negotiators. The USTR office followed up, saying that they are “in the process” of resolving outstanding issues, according to CNBC.
The 2-yr yield and the 10-yr yield increased four basis points each to 1.56% and 1.73%, respectively. The U.S. Dollar Index declined 0.18% to 97.12.
STOCK MARKET WRAP
S&P500, +0.97%, 3,066.91
Nasdaq, +1.13%, 8,386.40
Nikkei Futures, +0.47%, 22,850.0
Investors embraced risk, with cyclical sectors leading the rally. The S&P 500 energy sector (+2.5%) outpaced the market, as oil prices ($56.21, +2.03, +3.8%) rose nearly 4% and Exxon Mobil (XOM 69.60, +2.03, +3.0%) beat earnings estimates. Next in line were the industrials (+2.2%), materials (+1.5%), and financials (+1.4%) sectors.
Apple (AAPL 255.82, +7.06) rose 2.8% and the trade-sensitive Philadelphia Semiconductor Index rose 2.3%. The latter was supercharged by Qorvo (QRVO 97.22, +16.36, +20.2%), an Apple supplier, beating top and bottom-line estimates and providing encouraging guidance.
Separately, Fitbit (FIT 7.14, +0.96, +15.5%) agreed to be acquired by Alphabet (GOOG 1273.74, +13.63, +1.1%) for $7.35/share in cash, or approximately $2.1 billion. Pinterest (PINS 20.86, -4.28, -17.0%) disappointed investors with its guidance.
Alibaba blows past earnings estimates and says it expects further cloud growth. For the September quarter, Alibaba reported net income of RMB72.5 billion ($10.1 billion), or RMB27.51 a share ($3.85), up from RMB20 billion, or RMB7.62 a share, in the year-prior quarter. Excluding non-recurring items, Alibaba’s adjusted earnings per share rose to RMB13.10 ($1.83) from RMB9.60. Alibaba’s revenue rose to RMB119 billion ($16.7 billion) from RMB85.1 billion and came in ahead of estimates, which modeled RMB117 billion. The company saw RMB101.2 billion in revenue from its core commerce segment, which includes the popular Taobao and Tmall platforms. Alibaba had 693 million annual active customers on its China retail marketplaces and 785 million mobile monthly active users.