(INDEXSP:.INX) grinded to new highs again today. Telecom stocks
were in the lead, gaining 1.7% as a sector. Financial, utility, and
energy stocks lagged.
Japanese stocks failed to string together two straight days of
gains despite better economic data. Japan's September jobless rate
fell to 4.0% from 4.1% in the prior month as expected, and retail
sales grew on a year-over-year basis. The
(INDEXNIKKEI:NI225) finished down 0.49%.
) both reported worse-than-expected earnings. Deutsche Bank, the
largest currency trader in Europe, saw slowdowns in its currency
and fixed income trading businesses. The bank also had to set aside
a larger portion of its earnings as litigation reserves for its
involvement in rigging LIBOR rates. Although both banks opened down
more than 3%, by the end of the day, they finished positive.
The government caught up with a backlog of economic data reports
from September. Producer prices in September fell to a
year-over-year rate of 0.3% from 1.4% in the prior month.
Economists had estimated the rate would fall to 0.6%. The drop was
largely due to a fall in food and consumer nondurable prices.
September retail sales fell 0.1% from the prior month, below the
economist estimate of unchanged growth. The report was impacted by
the previously reported decline in auto sales and a sharp drop in
department store sales. Positive gains were seen in restaurant and
The October survey of consumer confidence by the Conference Board
fell to 71.2 from 80.2 last month. The large drop from the prior
month was due to a sharp decrease in economic expectations for the
) announced that it may buy back up to an additional $15 billion of
shares through 2014. The company's current buyback authorization
has an additional $5.6 billion remaining.
) reported third-quarter revenues and earnings that were well ahead
of consensus estimates, but its fourth-quarter guidance was
slightly weak, sending the stock modestly lower in extended
Tomorrow's Financial Outlook
Tomorrow's trading activity will be dominated by the Federal
Reserve's monthly monetary policy statement. It is unlikely that
the FOMC will make any major moves. At its September meeting the
FOMC decided not to reduce its asset purchases due to growing
uncertainty over the government's handling of the debt ceiling and
government shutdown. Because economic data reports have been
delayed due to the shutdown, and those that have been released have
shown worsening economic activity, it is unlikely that the Fed will
be pushed into taking any action.
The ADP's October private payroll report will be released in the
pre-market. Because the October non-farm payrolls report was pushed
back until next Wednesday, the ADP report will garner more
attention than normal. Also scheduled is the September consumer
European economic data releases should have an impact on early
trading. Spain will release its advance estimate of 3Q GDP, Germany
will release employment figures and CPI, and the eurozone will
release its economic confidence survey for October.
Fifty-one major US companies will report earnings tomorrow. Notable