Wall Street Breakfast: Black Friday In Full Swing
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The biggest shopping weekend of the year is here and 165.3M Americans are planning to shop or bargain hunt during the holiday, according to the National Retail Federation. Strong numbers could suggest a profitable shopping season ahead amid concerns over the health of the economy. From a market perspective, history suggests this is a very good time for retail stocks. Since 2007, the week before Black Friday to a week after, the sector usually gains 5%.
Go deeper: Lipper Alpha Insight says Black Friday can make or break Q4 profits.
While it's not a Thanksgiving hangover, Wall Street futures are pointing to declines of 0.2% ahead of a half-day trading session. Sentiment that propelled stocks to several rounds of record highs is under pressure from a human rights dispute in Hong Kong that could upend progress in Sino-U.S. trade talks. President Trump has signed into law Congressional legislation supporting the city's anti-government protesters, prompting Beijing to say it would take "firm counter measures" and attempts to interfere were doomed to fail.
Go deeper: 'Buy Hong Kong, Just Not Through iShares,' writes Tariq Dennison.
EU approves U.S. beef import increase
The European Parliament voted by 457-140, with 71 abstentions, in favor of a plan to permit U.S. farmers a larger share of an existing 45K ton quota from 2020. It came with a resolution that urges the removal of U.S. tariffs on EU steel and aluminum, and the withdrawal of a threat to raise tariffs on EU cars. "The message of this agreement is clear: we would like to de-escalate trade tensions with the U.S, but we want to see the same efforts of de-escalation on the other side of the Atlantic," said Bernd Lange, head of parliament's trade committee.
Go deeper: The big breakout is here for Hormel Foods (HML), according to Leo Nelissen.
Signals ahead of OPEC+ meeting
Putting pressure on OPEC+ to avoid a major policy shift, Russian oil companies have proposed not to change their output quotas as part of the current global supply cut deal. Non-OPEC oil producers and OPEC nations are due to discuss the agreement on Dec. 5-6, after curbing output to support prices for the last three years. "We see limited scope for a new round of cuts, in light of uneven compliance and diminishing returns," Fitch Solutions added in a note.
Go deeper: Bottom in crude oil is a buying opportunity, says QuandaryFX.
Ford won't take on Tesla's Cybertruck
"Sunny's tweet was tongue in cheek... nothing more," a Ford (NYSE:F) spokesman said, shooting down chances of a tug-of-war match between Ford's F-150 and Tesla's (NASDAQ:TSLA) new Cybertruck. Sunny Madra, Vice President of Ford X, prompted the challenge over Twitter this week, with Elon Musk responding, "Bring it on!" If the battle were to take place, odds put Tesla as 3-to-1 favorite, according to sports betting company BookMaker.eu.
Go deeper: Michael Gayed feels that Ford is facing a difficult future.
DOJ ends wireless collusion investigation
The Justice Department spent two years looking into whether AT&T (NYSE:T), Verizon (NYSE:VZ) and a trade association known as GSMA colluded over eSIM, which lets people remotely switch wireless providers without having to insert a new SIM card into a device. At the heart of the probe was whether the nation's largest wireless carriers, working with the standards body, used the technology to unfairly maintain their dominance. The DOJ dropped its investigation after the parties agreed to change how they determine standards for eSIM, while GSMA said the results had turned up no wrongdoing.
The retail portion of Saudi Aramco's (ARMCO) IPO has been fully covered, with orders reaching 32.57B Saudi riyals ($8.7B) before the offering closed yesterday at midnight. The state-owned oil giant plans to sell 1.5% of the company, or about 3B shares, at an indicative price range of 30 riyals to 32 riyals. That would value the IPO at as much as 96B riyals ($25.6B) and give Aramco a market value of between $1.6T and $1.7T.
Vancouver will outlaw the use of plastic straws and bags from April next year, making it the first major Canadian city to enact such a far-reaching ban. Earlier efforts saw Montreal issue a narrower plastic bag ban in 2018, while grocery chain Sobeys has said it will eliminate all plastic bags from its stores. Going nationwide... Prime Minister Justin Trudeau announced plans in June to prohibit some single-use plastics such as straws, bags and cutlery by early 2021.
Calling it a "mission critical priority," Christine Lagarde is pushing for climate change to be part of the ECB's purpose, in the first comprehensive review of the bank since 2003. Pushback? Some eurozone central bankers argue that climate action should be left to the EU's national governments to handle through fiscal policy, not monetary policy. Earlier this month, the San Francisco Fed convened the U.S. central bank's first-ever conference on the "Economics of Climate Change" and discussed the concept of a "green interest rate."
What else is happening...
Canadian National Railway (NYSE:CNI) kicks off recovery plan.
Morgan Stanley (NYSE:MS) ousts traders over concealed loss.
Tory poll lead gives sterling a boost.
Amazon Web Services (NASDAQ:AMZN) pours cash into custom silicon.
Apollo Global (NYSE:APO) raises Tech Data (NASDAQ:TECD) offer to $6B.
PG&E (NYSE:PCG) subject to California's inverse condemnation.
Today's Markets
In Asia, Japan -0.5%. Hong Kong -2%. China -0.6%. India -0.8%.
In Europe, at midday, London -0.2%. Paris +0.1%. Frankfurt -0.2%.
Futures at 6:20, Dow -0.2%. S&P -0.2%. Nasdaq -0.3%. Crude -0.3% to $57.92. Gold +0.1% to $1462.50. Bitcoin +1.3% to $7581.
Ten-year Treasury Yield flat at 1.76%
Today's Economic Calendar
4:30 PM Money Supply
4:30 PM Fed Balance Sheet
NYSE close at 1:00 PM
SIFMA close 2:00 PM