December 3rd

Daily Market Commentary

 

ECONOMIC NEWS

• MBA Mortgage Applications in the U.S. were reportedly down 7.3%.
• Nonfarm Productivity in the U.S. was reportedly up 2.3%, below estimates of 2.4%.
• The ADP Employment Change was reported at 208K, below estimates of 221K.
• The Markit Services PMI for the Eurozone was reported at 51.1, below estimates of 51.3.
• Retail Sales in the Eurozone were reportedly up 0.4% and 1.4% in month-over-month and year-over-year terms, respectively.

Commodities:

• Brent crude rebounded from near $70 a barrel as the market rout prompted by OPEC’s failure to curb production falters. West Texas Intermediate rose for the second day in three.
• Gold climbed as oil prices increased and on signs of more physical purchases from Asia. Platinum and palladium rose.
• Because gold traders often track the cost of oil, which can impact consumer costs and inflation, a whipsaw in crude futures is spurring the biggest price swings for bullion in almost nine months. Adding to the pain for investors in the metal is a dollar rally that’s curbing demand for alternative assets.

Canada:

• The global plunge in crude oil prices is impeding Canada’s economic recovery, threatening policy makers’ inflation outlook — and giving Bank of Canada Governor Stephen Poloz more reason to keep his benchmark interest rate unchanged today.
• Royal Bank of Canada, the country’s second-largest lender by assets, said quarterly profit rose 11% on gains in Canadian banking and wealth management.
• Wind Mobile struck a deal to let its mobile-phone customers access Telus Corp.’s network, helping the wireless carrier expand its service across Canada, according to a person familiar with the agreement.
• Onex Corp. is in talks to acquire Warburg Pincus LLC’s Survitec Group Ltd., a maker of safety and survival equipment, for about 450 million pounds ($704 million), according to three people with knowledge of the discussions.

United States:

• U.S. stock-index futures were little changed, after equities rose the most in a month, as investors awaited reports on the world’s largest economy to gauge the strength of the recovery.
• Federal Reserve officials are signalling more confidence in the economy that moves them nearer to raising interest rates, and are stressing the lift-off is linked to data rather than dates to avoid unsettling markets
• Stripe Inc. has raised $70 million in a financing round that values the digital-payments start-up at $3.5 billion.

International:

• A gain in health-care companies helped push European stocks to within 0.2 percent of a six-year high, amid bets that the European Central Bank will expand stimulus.
• The euro will fall to 2003 levels and German bund yields will tumble after the ECB announces a plan to buy euro-area government bonds in March, UBS Group AG forecasts.
• Vittorio Colao, CEO of Vodafone Group, said last month that his company needs to change to keep pace with the rapid convergence of Europe’s broadband and mobile phone industries. Rival BT Group Plc’s talk to buy one of Britain’s two biggest wireless carriers only adds to his urgency.
• Japanese stocks rose for a fourth day, with the Topix index closing at the highest level since 2008, as brokers and automakers advanced.
• CGN Power Co., seeking to become China’s first listed nuclear energy producer, raised about $3.2 billion in Hong Kong’s biggest initial public offering in two years, people with knowledge of the matter said.
• DBS Group Holdings Ltd., Southeast Asia’s largest lender, is working with Citigroup Inc. as it studies a potential bid for the international business of Royal Bank of Scotland Group Plc’s private bank, people with knowledge of the matter said.

*All information is taken from Bloomberg, unless otherwise noted.