Here is what you need to know.
It’s Fed day. Today could be the day the Fed raises the Fed Funds rate for the first time since 2006. The highly anticipated interest rate decision will come at 2 p.m. ET and will be followed by Chair Yellen’s press conference at 2:30 p.m. ET. Currently, the market is pricing in a 32% probability of a hike.
Markets around the globe are mixed. China’s Shanghai Composite (-2.1%) lagged in Asian trade and Spain’s IBEX (+1.4%) leads the gains in Europe. S&P 500 futures are down 2.75 points at 1985.25 per dollar.
The Swiss National Bank kept its policy unchanged. The Swiss National Bank kept its three-month Libor rate unchanged between -1.25% and 0.25%, as expected. According to the SNB, “The Swiss franc is still significantly overvalued, despite a slight depreciation.” The franc is stronger by 0.2% at .9693 per dollar.
Bank Indonesia warned on inflation. Indonesia’s central bank held its key interest rate at 7.50%, as expected, for the seventh straight meeting. The central bank noted it continued to monitor inflation as Indonesia’s currency, the rupiah, holds at a 17-year low. The rupiah ended unchanged at 14,459 per dollar.
Japan’s trade deficit widened. Trade data showed Japan posted a 569.659 trillion yen deficit in August, which was wider than the 542.5 billion yen deficit that economists were expecting. Exports rose 3.1% YoY and imports fell 3.1% YoY. The Japanese yen is weaker by 0.3% at 120.96 per dollar.
Oracle reported a mixed quarter. Enterprise software giant Oracle announced earnings of $US0.53 per share, topping the Wall Street estimate by a penny. Revenue slipped 1.7% versus last year to $US8.45 billion, missing expectations by $US80 million. The company blamed Fx headwinds, saying revenue adjusted for currency fluctuations was up 7%. In the press release, CEO Safra Catz promised to double profit margins on cloud products in two years from 40% to 80%.
Altice takes out Cablevision. European telecommunications giant Atlice is buying Cablevision for nearly $US18 billion as it looks to enter the US market, according to both the New York Times and Wall Street Journal. A tweet by WSJ reporter Anupreeta Das says the takeover “would end Jimmy Dolan’s 20-year run as CEO.” Dolan still owns Madison Square Garden, the New York Knicks and the New York Rangers.
GM settled its switch probe. The Associated Press reports three people familiar with the matter say General Motors has agreed to pay about $US900 million to settle a criminal investigation into whether or not the company hid a problem with small-car ignition switches. According to one of the AP’s sources, the charges would be dismissed after three years if GM complies with oversight and other terms. Reportedly no employees will be charged. “Today thanks to its lobbyists, GM officials walk off scot-free while its customers are 6 feet under,” said Clarence Ditlow, the executive director of the Center for Automotive Safety.
US economic data is heavy. Initial and continuing claims, housing starts and building permits and the current account balance are all due out at 8:30 a.m. ET and will be followed by the Philadelphia Fed at 10 a.m. ET. Natural gas inventories will cross the wires at 10:30 a.m. ET. The US 10-year yield is down 1 basis point at 2.28%.
Earnings reports are light. Manchester United and Rite Aid report before the opening bell and Adobe Systems releases its quarterly results after markets close.
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