Investing.com | Nov 08, 2019 12:45
Investing.com -- China's external trade improves, and Germany's exporters likely kept Europe's largest economy out of recession in the third quarter. Meanwhile Disney's traditional strength in movies is helping it shoulder the high costs of rolling out its Netflix-killer Disney+. Here's what you need to know in financial markets on Friday, 8th November.
1. China's exports bottom out
The reason for China’s increasing assertiveness in trade discussions with the U.S. became arguably a little clearer, after both exports and imports performed better than expected in September.
Exports showed signs of bottoming out with a drop of only 0.9% year-on-year, better than the 3.5% drop expected, while the decline in imports eased to only 6.9% from 8.5% in August. Imports were still down year-on-year for the sixth month in a row, however.
And it’s not like the Chinese economy is all roses: data out earlier showed car sales continued their freefall in October, falling 6% on the year. That’s the 16th month out of 17 that they’ve fallen in year-on-year terms.
The yuan held below 7 to the dollar, despite Thursday’s setback as Washington pushed back on China’s claims about an imminent trade truce.
2. Brighter news from Europe
There was also better news from Europe overnight as German exports posted their biggest increase in six months in September, something that analysts said may just have saved the region’s largest economy from recession in the third quarter.
Data from west of the Rhine also showed that French industrial production continued to expand, reflecting a lesser degree of exposure to China than its bigger neighbor, while figures also showed that job creation accelerated in the third quarter as the labor reforms of President Emmanuel Macron bore fruit.
Elsewhere, outgoing European Commission President Jean-Claude Juncker predicted in an interview with the Sueddeutsche Zeitung that he didn’t expect the U.S to impose tariffs on European automakers next week as President Donald Trump had previously threatened.
3. Stocks set to open flat to lower; bond yields hit three-month highs
U.S. stock markets are set to open a touch lower, extending the pullback that started after source reports pushing back against China’s upbeat version of trade discussions with the U.S.
The 10-year Treasury yield meanwhile hit 1.96% overnight, its highest since the start of August, before pulling back to trade at 1.91%. Other haven assets continued to labor, with gold futures languishing at $1,466.35 a troy ounce.
With earnings season starting to wind down, the day’s roster is headed by Duke Energy and Canadian pipeline company Enbridge. First Data, Ameren, Madison Square (NYSE:SQ) Gardens and aircraft leasing company AerCap are all also scheduled to report.
4. Disney shines
Walt Disney’s profit more than halved in the three months to September due to the costs of launching a streaming service to rival Netflix (NASDAQ:NFLX). Disney is cranking up output not just for its Disney+ service, but also for Hulu (which it now controls) and ESPN.
But prodigious takings from The Lion King and Toy Story 4 helped it to beat expectations. Box office revenue rose 52% and operating income rose 79% on the year in the quarter.
The shares rose 5.3% in after-hours trading while Netflix’s slipped 0.2%.
5. Alibaba's plans for a mega-listing in Hong Kong
Alibaba (NYSE:BABA) is preparing to sell up to $15 billion worth of shares on the Hong Kong stock exchange in a secondary offering planned for later this month, various reports said.
China’s most valuable company is planning to launch the sale after its Nov. 11 ‘Singles Day’ event, the Chinese equivalent of Black Friday. The deal would be the largest share sale of the year to date - although it's likely to be upstaged almost immediately by Saudi Aramco.
The move, which early reports suggested was an insurance policy against possible measures restricting Chinese companies’ access to U.S. capital markets, comes on the heels of founder Jack Ma’s stepping down as chief executive.
Written By: Investing.com
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.