Thousands of people recently demonstrated in Brussels against free trade deals negotiated by the EU. This happened just days before a meeting of EU trade ministers in Bratislava last month, which was considered the last push to salvage the Transatlantic Trade and Investment Partnership (TTIP) between the EU and the United States. Not only is Europe divided on the deal, but the talks have been extremely secretive.
For the 3rd month in a row, sales of previously owned homes are flat year-over-year. Month-over-month saw a better than expected 3.2% rise in September (ahead of the school year) but SAAR sales remain noisily stuck 25% below 2005's highs. Notably, this is the 55th straight month of year-over-year home price gains.
The market is not happy. Hit with a double-whammy of "ECB not discussing an extension of QE beyond March" and that "extraordinary policy support won't last forever." EURUSD jumped, stocks dumped, and Bund yields spiked. However, a quick hint that "an abrupt end to QE is unlikely" helped a little...
By now we have shown every possible divergence between the ongoing collapse in jobless claims (everything is awesome) as practically every manufacturing and service economy hard data print suggests the exact opposite. So this week, we just notice that initial claims jump over 5% this week to 260k - the biggest weekly rise since May... probably nothing.
With a flurry of political risk events over the coming months, and a new global focus on fiscal policy, Draghi needs to reassure market players that the ECB has more ammunition as well as laying to rest the taper talk that spooked bond markets this month.
“He and his staff might not know this, but he is done,” said Jim Manley, the Clinton surrogate and Democratic strategist. “He had one last chance to expand his base tonight [more] than he did in the last two debates, but he is dead man walking.”
Moments ago Deutsche Bank stock, which has been well away from the headlines in the past two weeks, spiked following a Manager Magazin report according to which the Qatar and Abu Dhabi Sovereign Wealth Fund together with Chinese investors would be willing to raise their stake in DB to 25% in the case of a capital increase.
The ECB was not expected to change any of its three main refinancing rates in today's announcement and it did not disappoint, keeping the Main Refinancing Rate unchanged at 0.0%, and its marginal lending and deposit facility rates at 0.25% and -.40% respectively.
Draghi will make clear that tapering has not yet even been considered. He will emphasize that the program runs until March, at least, and so they have plenty of time to plan the exit. There’ll be no taper-tantrum today. Far from tapering, it’s likely that the Asset Purchase Program will be prolonged even further beyond March, although perhaps not formally so at this meeting. An extension will require technical adjustments that may need more time to work out.
Global stocks were modestly higher, before the European Central Bank gives its policy update, while investors weigh mixed earnings results. Asian stocks rise, U.S. equity-index futures are little changed. The euro touched its weakest level since July and stocks in the region fell after their first back-to-back gains in two weeks.
Wall Street is maneuvering to propose and implement a new retirement tax on Americans under a Hillary Clinton Administration. Leading the charge is billionaire financial oligarch Tony James, who is COO of private equity giant Blackstone. Mr. James is a generous contributor to Hillary Clinton’s Presidential run, and is listed as a “Hillblazer” by her campaign for having raised at least $100,000 toward her candidacy.