U.S. futures and the dollar are posting big gains, along with shares across the globe, as bullish sentiment returned to Wall Street following the largest streak of losses on the S&P 500 since 1980. "Based on our review, we have not changed our conclusions that we expressed in July," FBI Director James Comey said in a letter to Congress, standing by an earlier recommendation that no criminal charges were warranted against Hillary Clinton over her email practices.
Economy
Nearly 42M Americans have already voted for president, casting their ballots in record numbers before polls officially open tomorrow for Election Day. Both Clinton and Trump have spent much of the last week campaigning in crucial battleground states, which may ultimately decide the outcome of the election. "The key is Florida and North Carolina," said Mercer University elections expert and professor John Christopher Grant.
Theresa May believes the U.K. government has a "strong" case for overturning the High Court ruling allowing Parliament to vote on the triggering of Article 50. Brexit Secretary David Davis will lay out the details later today. Meanwhile, Brussels is reconsidering how it grants EU market access to overseas financial firms, casting doubt over the use of the bloc's "equivalence" arrangements as a fallback option for London post-Brexit.
Eurozone retail sales annual growth slowed for a second straight month in September, falling 0.2% on a month-on-month basis, according to preliminary data from Eurostat. The drop was mainly caused by a slump in sales of non-food products, with the sharpest declines seen in Germany, Portugal and Slovenia. Compared to the same month last year, retail sales were up 1.1%.
Greek Prime Minister Alexis Tsipras has reshuffled his cabinet in a bid to speed up bailout reforms so debt restructuring negotiations could start at an EU finance minister meeting on Dec. 5. The move could also help the country qualify for inclusion in the ECB's bond buying scheme and regain bond market access by 2018, when its current bailout program expires.
Military buildup: Hundreds of thousands of NATO troops will be put on a higher state of alert amid growing tensions with Russia, according to Jens Stoltenberg, the alliance's secretary-general. Separately, operation "Euphrates Anger" has begun to liberate Raqqa from ISIS. The offensive, which comes two weeks after a campaign to clear ISIS from Mosul, will be supported by U.S. air strikes and involve 30,000 fighters.
China has appointed a new finance minister, Xiao Jie, as concerns grow over the country's rising fiscal deficits and mounting debt, which has jumped to more than 250% of GDP. China is also considering allowing Wall Street banks to run their own investment-banking businesses on the mainland, WSJ reports, dropping a requirement for U.S. banks to operate as minority partners in local joint ventures.
Tens of thousands of people rallied in Seoul on Saturday to demand South Korean President Park Geun-hye step down over an explosive political scandal. While several politicians have individually called for the president's resignation, opposition parties have yet to attempt a serious push for her departure or impeachment in fear of negatively impacting next year's presidential election.
Algeria Energy Minister Nouredine Bouterfa is confident OPEC members will stick to a pact made in September to cut output, saying the group's technical committee was working on applying the deal. Officials met in Vienna last month to work out the details of the Algiers plan, but failed to reach agreement. OPEC's High Level Committee of experts will meet again on Nov. 25. Crude futures +1.7% to $44.80/bbl.
Wall Street bonuses are expected to decline for the third consecutive year, reflecting a period of busted mergers, limited trading activity, lack of new listings and muted hedge fund returns. The payouts are projected to be from 5%-10% lower this year, according to a closely watched report by Johnson Associates. Bonuses fell about the same amount last year from 2014.
Stocks
Overnight earnings roundup: HSBC +3.4% premarket as investors shrugged off an 86% drop in pretax profit following a big loss on the sale of its Brazilian business. Nissan Motor (OTCPK:NSANY) cut its first-half net income forecast as a strong yen offset rising sales, but maintained its full-year dividend plan. Softbank's (OTCPK:SFTBY) second quarter profit rose nearly 7%, boosted by a strong performance in its domestic telecoms division.
Oracle has narrowly overcome opposition to its $9.3B offer for NetSuite (NYSE:N) after threatening to walk away if stakeholders held out for a higher price. Nearly 56% of NetSuite shareholders who were eligible to vote chose to take its offer, laying the groundwork for the deal to close today. The tie-up will add nearly $1B to Oracle's (NASDAQ:ORCL) revenues from cloud software.
Looking to rebound from its Note 7 fiasco, Samsung Electronics (OTC:SSNLF) plans to adopt a voice-based digital assistant for its upcoming Galaxy S8, Reuters reports. The agent will be based on work by Viv Labs, an AI firm that Samsung acquired this October. The founders of the company already have a strong track record in the field as the creators of Siri, which Apple (NASDAQ:AAPL) bought in 2010.
Known as the "prince" of Baidu and widely seen as a potential CEO successor, Li Mingyuan has resigned after an internal company probe found "conflicts of interest." The high-profile departure is the latest in a series of setbacks for Baidu (NASDAQ:BIDU) as the firm sees advertising revenues shrink this year in the wake of new regulations on paid advertisements and real-name identification.
While it didn't invent China's Singles Day sale, Alibaba (NYSE:BABA) made it a fixture of the retail calendar. Now the company plans to use the brouhaha around the event to launch itself beyond mainland China, catering to shoppers in Hong Kong and Taiwan. Last year, Alibaba turned over $14.3B on November 11, more than double the $5.8B in total U.S. e-commerce sales for Black Friday and Cyber Monday.
General Electric is seeking to remove a "limited number" of engine parts from service that had a "material anomaly" after an American Airlines (NASDAQ:AAL) jet erupted in flames last week. In other GE Aviation news... The company has completed testing of an engine that is made from more than 35% 3D-printed parts, just a year since the certification of a single printed engine part for aircraft was big news.
Wrapping up months of negotiations, Canadian workers at Ford Motor (NYSE:F) have voted to approve a new four-year contract, which promises hundreds of millions in new investment in the carmaker's local operations. Talks kicked off in August between Unifor and the Canadian units of the Big Three automakers, and workers approved contracts at (NYSE:GM) and Fiat Chrysler (NYSE:FCAU) in September and October.
German prosecutors have widened their probe of Volkswagen's (OTCPK:VLKAY) market manipulation to include Hans Dieter Potsch, chairman of the supervisory board, who was CFO when "Dieselgate" broke in September 2015. According to Bild am Sonntag, California Air Resources Board is also investigating another software cheat in some Audi (OTCPK:AUDVF) vehicles - different than VW's defeat device - that may have lowered their carbon dioxide emissions.
Buyers beware? As Takata (OTCPK:TKTDY) prepares for a possible U.S. bankruptcy filing, potential bidders are poring over a recent U.S. court ruling that could expose a buyer to liability for the company's defective air bags. In July, the 2nd U.S. Circuit Court of Appeals in Manhattan held that "new GM" could be sued over faulty ignition switches made by "old GM."
Toyota is looking at mass-producing long-range electric vehicles that would hit the market around 2020 in what would be a dramatic reversal in strategy for the world's top-selling automaker. Even as rivals have touted pure electric cars as the most viable zero-emission vehicles for the future, Toyota (NYSE:TM) said it would reserve EVs for short-distance commuting given the high price of rechargeable batteries and lengthy charging times.
The largest U.S. gasoline pipeline restarted its main gasoline conduit Sunday morning after a deadly explosion shut Line 1 for six days and forced Gulf Coast refiners to cut rates. Colonial anticipates fuel products leaving the pipeline's Houston origin to arrive in Linden, New Jersey, where the system ends, within approximately three days. Stocks/ETFs potentially affected: UGA, DK, ALJ, VLO, MPC, PBF, RDS.A, RDS.B
Today's Markets
In Asia, Japan +1.6% to 17177. Hong Kong +0.7% to 22801. China +0.3% to 3133. India +0.7% to 27459.
In Europe, at midday, London +1.5%. Paris +1.8%. Frankfurt +1.6%.
Futures at 6:20, Dow +1.4%. S&P +1.4%. Nasdaq +1.6%. Crude +1.7% to $44.80. Gold -1.2% to $1288.90.
Ten-year Treasury Yield +3 bps to 1.81%
Today's Economic CalendarIn Europe, at midday, London +1.5%. Paris +1.8%. Frankfurt +1.6%.
Futures at 6:20, Dow +1.4%. S&P +1.4%. Nasdaq +1.6%. Crude +1.7% to $44.80. Gold -1.2% to $1288.90.
Ten-year Treasury Yield +3 bps to 1.81%
8:30 Gallup US Consumer Spending Measure
10:00 Labor market condition index
12:30 PM TD Ameritrade IMX
3:00 PM Consumer Credit
Companies reporting earnings today »10:00 Labor market condition index
12:30 PM TD Ameritrade IMX
3:00 PM Consumer Credit
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