Here is what you need to know.
Janey Yellen speaks today. Attention will be on Federal Reserve Chair Janet Yellen when she speaks at the University of Massachusetts at 5 p.m. ET. Traders will be watching Yellen’s speech, titled “Inflation Dynamics and Monetary Policy” for clues as to whether or not Fed liftoff will occur at some point in 2015.
Xi goes to Washington. According to AFP, Chinese President Xi Jinping will meet with President Obama over a private dinner at the White House on Thursday. On Friday, the two heads will then hold formal discussions on topics ranging from cybersecurity to China’s aggression in the South China Sea before enjoying a state dinner in the evening.
Shinzo Abe announced 3 new ‘arrows’ to bolster the Japanese economy. Japanese Prime Minister Shinzo Abe has added 3 new ‘arrows’ to his quiver. Abe’s new policies include a strong economy (A GDP target of 600 trillion yen, or $US5 trillion), increased support for families and social security, Bloomberg reports. The Japanese yen is stronger by 0.6% at 119.62 per dollar.
Norway’s central bank surprised with a rate cute. The Norges Bank unexpectedly cut its key rate 25 basis points to a record low 0.75%. The rate cut was the third in the past 10 months and was done in response to a weaker growth and inflation outlook. “The current outlook for the Norwegian economy suggests that the key policy rate may be reduced further in the coming year,” Governor Oystein Olsen said in the statement. The Norwegian krone is weaker by 2.1% at 8.4454 per dollar.
Taiwan’s central bank lowered its key rate. The Central Bank of the Republic of China (Taiwan) lowered its benchmark interest rate 12.5 basis points to 1.75%. According to Reuters, the rate cut was the first in six years and comes as the central bank attempts to support economic growth. Ahead of the decision, the Taiwan dollar ended down 0.3% at 33.129 per dollar, its weakest since 2009.
German businesses are more confident. The latest reading of German business confidence showed a small improvement in September, edging up to 108.5 from August’s reading of 108.4. While businesses were generally a bit more downbeat about their current situation, they expressed more confidence about the future. The report, which was written by Hans-Werner Sinn, President of the Ifo Institute, suggested, “The German economy is proving robust.” The euro is stronger by 0.4% at 1.1231 per dollar.
GE is unloading more assets. People close to the matter told Bloomberg, General Electric has agreed to sell its private-equity investment group to France-based asset manager Ardian for about $US500 million. The deal is the latest in a series of moves by GE to slim down and focus on manufacturing. GE has sold more than $US35 billion worth of assets so far this year.
Stock markets around the globe are mostly lower. Japan’s Nikkei (-2.8%) tumbled as traders returned to work following the extended holiday. In Europe, Germany’s DAX (-2.0%) leads markets lower in Europe. S&P 500 futures are down 14.00 points at 1914.50.
US economic data picks up. Initial and continuing claims and durable orders are set to cross the wires at 8:30 a.m. ET and new home sales will be announced at 10 a.m. ET. Natural gas inventories will be released at 10:30 a.m. ET. The US Treasury will auction $US29 billion 7-year notes at 1 p.m. ET. The US 10-year yield is lower by 3 basis points at 2.12%.
Earnings reports flow. Accenture and KB Homes are the notable reports ahead of the opening bell. Bed Bath & Beyond, Cintas, Jabil Circuit and Nike are scheduled to release their quarterly reports after markets close.
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