Five Things You Need to Know to Start Your Day
Five Things You Need to Know to Start Your Day
(Bloomberg) --
U.S.- Mexico talks extended as deadline looms, it’s ECB day, and Fiat walks away from Renault. Here are some of the things people in markets are talking about today.
Keep talking
President Donald Trump said “not nearly enough” progress was made at the first day of talks between Mexico’s foreign minister Marcelo Ebrard and White House officials at yesterday’s meeting to avert the U.S.’s 5% tariff threat due to kick in Monday. Negotiations are set to continue today, but Trump’s comments were enough to help the peso drop more than 1%, a move also driven by credit-ratings downgrades of the country. On another trade front, the president again pushed for concessions from China, reiterating his promise to place tariffs on another $300 billion of imports.
ECB day
The European Central Bank is expected to keep its policy rates unchanged when it announces its decision at 7:45 a.m. Eastern Time, but that does not mean there will be nothing for investors to watch from today’s meeting and press conference. There will be updated economic forecasts, which may allow President Mario Draghi to at least signal more monetary support for the euro-area economy. The modalities of the latest long-term loans to banks – TLTRO III – are also expected today, with interest rates on them expected to be as low as the deposit rate at -0.4%
Fiat walks away
Fiat Chrysler Automobiles NV abruptly withdrew its offer to combine with Renault SA, saying the political conditions in France do not exist for a successful deal. The surprise move came after the board of Renault postponed a decision on the deal for a second time. Shares in both companies fell, with Renault tumbling as much as 8% in Paris and Fiat dropping as much as 3.8% in Milan.
Markets mixed
Overnight, the MSCI Asia Pacific Index slipped 0.2% while Japan’s Topix index closed 0.3% lower. Stocks in China ended the holiday-shortened week on a down note. In Europe, the Stoxx 600 Index was 0.6% higher by 5:50 a.m. with consumer staples among the best performers ahead of the ECB meeting. S&P futures pointed to a gain at the open, the 10-year Treasury yield was at 2.105% and gold was higher.
Coming up…
Weekly initial jobless claims at 8:30 a.m. will give one last look at the health of the U.S. employment ahead of tomorrow’s payrolls data. Also at that time, the April trade balance is published. Dallas Fed President Robert Kaplan and New York Fed President John Williams are today’s Fed speakers. In earnings, there will be interest when start-up sensation Beyond Meat Inc. reports after the close.
What we've been reading
This is what's caught our eye over the last 24 hours.
- Inside Huawei at war: How the tech giant is fighting the U.S.
- The yield curve is regaining some forecasting power, BOE says.
- Wall Street is desperate for wonks who can explain the rise of populism.
- U.S. home flippers are cashing out before profits get slimmer.
- The virus threatening half of the world’s pigs is almost invincible.
- Swiss regulator fines banks $91 million over foreign exchange cartel.
- Pregnant women live near the limits of what the human body can cope with.
To contact the editor responsible for this story: Cecile Gutscher at cgutscher@bloomberg.net, Sid Verma
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