Good morning! Here’s what you need to know.
1) European Central Bank Discussing Securities-Buying Program. Reuters’ Mike Peacock reports Brussels is considering launching an asset-backed securities (ABS) and covered bond purchase program worth up to 500 billion euros. “ECB President Mario Draghi will likely announce such a program at his news conference unless it comes up against strong opposition at the Governing Council’s policy meeting,” he writes. “The program would have a duration of three years and comprise both ABS and covered bond purchases. The ECB could begin buying the assets this year, the people familiar with the discussions told Reuters.”
2) Bank Of Japan Unchanged. Despite the Japanese economy’s having contracted at the fastest rate since early 2011, BOJ Gov. Haruhiko Kuroda said the plan increase the country’s monetary base by Y60tn to Y70tn per year remained in place. “Analysts weren’t expecting a change but many believe deteriorating economic data and slowing inflation will force the hand of the bank, as it aims to increase the country’s monetary base by Y60tn to Y70tn per year with a goal of hitting 2 per cent inflation by next year,” the FT writes, adding, “The BoJ continually pledges that it will loosen policy if necessary, but so far it’s remained relatively upbeat about the economy. Besides, Governor Haruhiko Kuroda tends to say it’s structural reforms, not monetary loosening, that the country needs.”
3) Bank of England Unchanged. Gov. Mark Carney announced he would keep rates at 0.5%, as expected, and would continue to target 375 billion sterling’s worth of asset purchases.
4) Goldman Warns On Scotland Vote. The bank, along with two other groups, says a Eurozone style financial crisis could erupt in Britain if Scotland votes to secede. “Uncertainty over a currency union [could cause] a run on assets and deposits based north of the Border,” the Telegraph reports. “Alex Salmond has said the three main U.K. parties are bluffing by ruling out a formal deal to share the pound, but the global investment bank concluded the warning was ‘credible.’ “
5) JPMorgan Downgrades GoPro. Analysts changed their rating from “overweight” to “neutral” saying the stock is now overvalued, according to StreetInsider. Shares in the camera maker are down 5% pre-market. They were previously trading at about $US56.
6) Bloomberg’s Back. The former New York City Mayor says he will come back on to lead Bloomberg L.P., the company he founded in 1981. “…in recent months, Mr. Bloomberg — who still owns 88 per cent of the company — has become an increasing presence at Bloomberg’s Lexington Avenue headquarters,” the New York Times’ Andrew Ross Sorkin reports. “Those ‘few hours’ soon turned into six and seven hours a day with Mr. Bloomberg taking a hands-on role in meetings and strategy decisions. [Outgoing CEO Dan] Doctoroff, 56, a former deputy mayor of New York and private equity executive, told Mr. Bloomberg about two weeks ago that he planned to resign, frustrated with how the leadership dynamic had shifted. Mr. Bloomberg urged him to stay and remain chief executive, but Mr. Doctoroff demurred.”
7) German GDP Forecast Slashed. The HWWI economic institute has cut German 2014 GDP forecast to 1.6% from 2.2%, and for 2015 from 2.5% to 2%, on the lowered dynamism of the eurozone and geopolitical risks, according to Die Welt’s Holger Zschaepitz.
8) Mobileye Is Down. Shares in the assisted driving software developer are off 3.1% after reporting flat year-over-year GAAP earnings. We recently discussed why Wall Street thinks this company is at the vanguard of firms investors should look to to invest in the autonomous driving revolution.
9) A Ton Of Data. At 8:15 we get ADP private payrolls. At 8:30, weekly jobless claims, the U.S. trade balance, and productivity and costs. At 9:45 a.m. we get the PMI reading for the services industry, and finally at 10 a.m. we get the ISM’s non-manufacturing survey.
10) Markets. Stocks in Asia are mostly down. Japan’s Nikkei is off 0.33%. European shares are mostly higher, with London’s FTSE up 0.3%. U.S. futures are higher, with S&P futures up 0.3%.