To the scoreboard:
- Dow: 24,984.55 +401.13 (+1.63%)
- S&P500: 2,705.57 +49.47 (+1.86%)
- AUD/USD: 0.7080 +0.0017 (+0.24)
- ASX SPI futures (December contracts): 5,701 (+73)
1. US stocks rebounded strongly overnight, with tech stocks leading the rally as the NASDAQ jumped by 3.5% to partially offset the previous day’s 4.6% drop.
2. Q3 earnings season rolls on: Of the US companies which have reported so far, more than 80% have beaten expectations. Amazon reported strong Q3 profits but missed on revenue and its stock fell 7% in after-hours trade. Google almost missed and fell 5% after-hours, although while Twitter rose more than 15% after beating on profits and revenue.
3. Despite the buoyant session for US stocks, fears remain that Q3 may represent the earnings peak for US companies, as increasing input costs from higher wages, steadily rising interest rates and the impact from the China trade war begin to put pressure on margins.
4. The European Central Bank had no big surprises for markets overnight, maintaining its plans to end its bond purchasing program at the end of this year. ECB President Mario Draghi said Italy will need to agree to terms on public spending with the European Union before it gets any additional help from the ECB.
5. The euro lost more ground against the USD after Draghi’s press conference, while the UK pound fell to its lowest level since early September amid lingering concerns over Brexit. Italian bond yields fell 11 basis points to 3.5% while US bond yields were little-changed.
6. Oil prices continued to edge higher after hitting a two-month low earlier in the week, while iron ore is now in a bull market. In what has been a particlulary low month of volatility for cryptocurrencies, Bitcoin edged lower beneath the $US6,500 mark overnight.
Here’s a look at today’s economic calendar:
- China industrial profits.
- First reading of US Q3 GDP.
- University of Michigan US consumer sentiment survey.
Have a great weekend.
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