Here is what you need to know.
THe IEA thinks oil prices could’ve bottomed. Reuters reports, the International Energy Agency says there are signs energy prices might’ve put in their lows as output is falling faster than expected and the supply from Iran is having a smaller impact than expected. In its latest forecast, the IEA projects non-OPEC output will fall by 750,000 barrels per day in 2016 after previously forecasting a drop of 600,000 bpd. The US alone will see a drop in production of 530,000 bpd, the IEA says. Crude oil is up 2.2% at 38.66 per barrel.
The UK’s trade deficit with the EU hit a record. Data from the Office of National Statistics showed the UK’s trade deficit widened to £10.3 billion in January, which was in-line with estimates. Notable is that the UK’s trade deficit with the European Union expanded to £8.1 billion for the month and £23 billion pounds over the past three months, both records according to Bloomberg. This will surely be a talking point of those campaigning for a ‘Brexit’ at the June 23 referendum. The British pound is stronger by 0.2% at 1.4303.
European bank stocks are surging. On Thursday, the European Central Bank lowered its main refinancing rate to zero and cut its deposit rate to -0.40% while increasing its quantitative easing program to €80 billion per month. The announcement has sparked a massive rally in European financials. Italian banks are among the top performers on the day as Unicredit and Intesa Sanpaolo are both higher by more than 5%.
PIMCO thinks the ECB might eventually buy blue-chip stocks. The markets reaction to the the ECB rate cuts had many market participants discussing the possibility that the ECB was “out of ammo.” But PIMCO managing director and portfolio manager Adam Bosomworth doesn’t think so. In an opinion piece written overnight, he suggested the central bank will use asset purchases to stimulate the economy and that the purchase of blue-chip stocks is “not a far step away.”
Deutsche Bank warned Q1 is going to be rough for all of the banks. Volatile financial markets are going to pose a challenge for the entire banking sector in the first quarter, Deutsche Bank warns. This seems to jive with comments from other investment banks like JPMorgan and Citigroup, who have previously warned about tough conditions. “Deutsche Bank is no exception to this. Nonetheless, in this period of market turbulence, Deutsche Bank remains very solid,” CEO John Cryan said in the company’s annual report, which was published on Friday.
Singapore is the most expensive city in the world to live in. On Thursday, the Economist Intelligence Unit released its report titled “Worldwide Cost of Living.” It showed that Singapore was the most expensive city in the world to live in when taking into account food costs, fuel costs and salaries. Rounding out the top three were Zurich, Switzerland and Hong Kong. US cities making the top 10 were New York (7) and Los Angeles (10).
Short seller Andrew Left has a new target. Noted short seller Andrew Left, whose recent targets include Valeant and Mobileye, has a new short. On Thursday, he released a 21-page report on tech company j2 Global. Left slapped a $26 target on the name, saying it has “hit a wall.” The stock finished Thursday’s session down close to 20% at $56.90 per share.
A new iPhone might be coming soon. Apple has sent out invitations for its next event, which is scheduled to take place on March 21. It’s being speculated the company will announce the launch of an upgraded 4-inch iPhone and a new Apple Watch.
Stock markets around the globe are higher. Hong Kong’s Hang Seng (+1.1%) paced the overnight gains and Germany’s DAX (+2.8%) is the top performer in Europe. S&P 500 futures are higher by 18.75 points at 2007.25.
US economic data is light. Import and export data will be released at 8:30 a.m. ET. The US 10-year yield is up 1 basis point at 1.95%.