Good morning! Here’s what you need to know:
Here Comes Apple. Apple is expected to unveil new products today, including the iPhone 6, a smartwatch, and a new payments system. “Apple hasn’t released a new product in 2014, save for some minor refreshes to a few of its MacBook models,” reported BI’s Steve Kovach. “Instead, it’s packing all its announcements into the fall. And it all starts Tuesday.” Click here for a complete preview of today’s Apple event.
The Stakes Are High For Tim Cook. BI’s Jim Edwards has characterised Apple CEO Tim Cook’s speech as the most important speech of his life. “The world Apple lives in is moving faster than it ever has before,” Edwards said. “Apple now has rivals that are more nimble than its old enemy, Microsoft… To a surprising extent, Apple is playing catch-up…”
UK Industrial Production Surprises. Industrial output in the U.K. increased 0.5% in July, the biggest jump in five months. This was better than the 0.2% expected by economists. “Industrial production growth was boosted by electricity and gas production, which may prove temporary as it is volatile,” noted Bloomberg economists Jamie Murray and Niraj Shah. “The underlying picture is one of slow manufacturing growth (which accounts for the bulk of production.).”
Carney Signals A Spring Rate Hike. “Our latest forecasts show that, if interest rates were to follow the path expected by markets — that is, beginning to increase by the spring and thereafter rising very gradually — inflation would settle at around 2% by the end of the forecast and a further 1.2 million jobs would have been created,” Bank of England Mark Carney said at the Trade Union Congress in Liverpool. The BoE is expected to be the first of the major central banks to tighten monetary policy.
General Mills Makes A Move Into Organic Food. General Mills is buying organic cheese and shells maker Annie’s for $US820 million, or $US46 per share. The price represents a 37% premium to Monday’s closing price. “Powerful consumer shifts toward products with simple, organic and natural ingredients from companies that share consumers’ core values show no signs of letting up,” said Annie’s CEO John Foraker. “Partnering with a company of General Mills’ scale and resources will strengthen our position at the forefront of this trend, enabling us to more rapidly and efficiently expand into new channels and product lines in a rapidly evolving industry environment.”
Markets Are Mixed. In Europe, Britain’s FTSE is flat, France’s CAC 40 is down 0.1%, Germany’s DAX is down 0.1%, and Spain’s IBEX is down by 0.5%. Asia closed mix with Japan’s Nikkei up 0.2% and Hong Kong’s Hang Seng down 0.2%. U.S. futures are up with Dow futures up 11 points and S&P 500 futures up 0.6 point.
Job Openings. At 10:00 a.m. ET, the Bureau of Labour Statistics will publish its July Job Openings & Labour Turnover Survey. Economists estimate the JOLTS report will reveal 4.70 million U.S. job openings in July. “JOLTS (Job Openings and Labour Turnover Survey) has garnered more attention lately as Fed Chair Yellen often cites the survey when assessing the state of the labour market,” said Credit Suisse economists. “In June, JOLTS job openings continued to strengthen, rising to 4.7M and job vacancies per unemployed worker increased to 0.49, the highest level since May 2008. The ratio of vacancies to unemployed workers has risen much faster than its post-crisis trend for three months in a row, providing further confirmation that the US labour market has indeed shifted to a period of stronger growth. However, the rate of hiring rose only slightly and quits were unchanged in June, remaining well below pre-crisis levels.”
Home Depot Confirms Data Breach. “Home improvement retailer Home Depot on Monday confirmed its payment systems were breached, potentially impacting customers using payment cards at its U.S. and Canadian stores,” reported Reuters’ Shailaja Sharma. “While the full scope of the breach was yet to be determined, there was no evidence that debit PIN numbers were compromised, Home Depot said in a statement.”
Trump To File For Bankruptcy. “Trump Entertainment Resorts Inc., the company founded by Donald Trump, will file for bankruptcy again this week, people with knowledge of the situation said, putting a fifth Atlantic City casino in danger of closing,” reported Bloomberg’s Christopher Palmeri, Elise Young and Michael Bathon. “The company owns two properties in the struggling New Jersey resort town. Trump Plaza is set to cease operations on Sept. 16, and the Trump Taj Mahal may also shut in November, the people said. Three other casinos have closed in the city this year, including Caesars Entertainment Corp.’s Showboat and the Revel Casino Hotel last week.”
Insider Trader Gets 9 Years. “Mathew Martoma, a former portfolio manager at billionaire Steven A. Cohen’s SAC Capital Advisors LP hedge fund, was sentenced on Monday to nine years in prison for engaging in what authorities called the most lucrative insider trading scheme in U.S. history,” reported Reuters’ Nate Raymond. “U.S. District Judge Paul Gardephe in New York also ordered Martoma, 40, to forfeit $US9.3 million.”