10 Things You Need To Know Before The Opening Bell
Oct 11, 2013, 16:55 IST
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- Markets were up around the world. The Nikkei climbed 1.48%. Hong Kong's Australia's S&P/ASX 200 was up 1.63%. London's FTSE led Europe indices at 0.66%.
- The rally came as the White House met with Republican leaders in what the New York Times called a "significant breakthrough" toward ending the government shutdown and raising the debt ceiling. "Even if Democrats found fault with the Republicans' immediate proposal - for example, it would prevent the Treasury secretary from engaging in accounting maneuvers to stave off potential default - it was seen as an opening gambit in the legislative dance toward some resolution before the government is expected to breach its debt limit on Thursday."
- Still, day 11 of the shutdown begins today. Fortunately a hugely important indicator is unaffected and will be published today: the University of Michigan/Reuters' consumer confidence index. Here's Bill McBride's preview: "At 9:55 AM ET, the Reuters/University of Michigan's Consumer sentiment index (preliminary for October). The consensus is for a reading of 75.0, down from 77.5 in September. Other sentiment indicators have shown a sharp decline."
- The New York Times' reports business leaders have come to a startling conclusion: on the subject of the government shutdown and debt ceiling, they have no influence over Washington's deliberations. "Their frustration has grown so intense in recent days that several trade association officials warned in interviews on Wednesday that they were considering helping wage primary campaigns against Republican lawmakers who had worked to engineer the political standoff in Washington."
- JPMorgan and Wells Fargo report earnings this morning. JPM is forecast for $1.17/share on $23.94 billion in revenue; WFC, $0.97/share on $20.97 billion, per Reuters.
- Edward Jones' Shannon Stemm told our Linette Lopez analysts will be watching for one item very closely from the two banks: "We'll be looking at mortgage banking results," Stemm told Business Insider via e-mail. "While a drop in refinancing activity has been telegraphed and is expected, we'll be interested in any growth in new purchase activity as well as management's commentary around housing market health in general.
- The Euro zone wants to kick the IMF out of Europe, and the fund appears happy to oblige, the Wall Street Journal's Matina Stevis reports. Everything broke down over Greece. "A big source of tension has been the IMF's Debt Sustainability Analysis, which is heavily based on projections of the ratio of government debt to economic output. IMF rules prevent the fund from giving aid to states unable to repay their debts, so this analysis has been critical in ensuring the fund continues lending. But the analysis wasn't well regarded by some officials. One IMF official called it 'a joke,' a commission official described it 'a fairy tale to put children to sleep' and a Greek finance ministry official said it was 'scientifically ridiculous.' "
- Developing markets panicked at the prospect the Fed would begin tapering its bond buying program. But in a new note, HSBC says the effect may not be quite so severe - since Japan now seems poised to pick up the relay. Via the FT:With the Bank of Japan engaging in unprecedented easing, lending by Japanese financial institutions, especially into neighbouring markets, will continue to soar, helping to offset potential tapering and tightening elsewhere," HSBC said.
- Federal officials have begun discussions about overhauling how economically sensitive data gets released, The Wall Street Journal's Brody Mullins and Colleen McCain Nelson report. There have been several reports this year finding evidence some outlets received the news early. "While the talks are preliminary, officials are driven by their growing concern about leaks and their unease that high-speed trading firms can trade on market-moving numbers before other investors, say people familiar with the discussions," they write.
- Amazon won a $600 million contract from the CIA to build a "private" cloud, which our Julie Bort calls a "game changer." "...until this contract, [Amazon] only provided "public" cloud services, meaning its users shared Amazon's data center. This CIA contract is for a "private" cloud, meaning Amazonwill build a cloud in the CIA's own data center that's not shared with others."