Market Review 11-10

Market Review 11-10

JPMorgan Reports Earnings Amid Mortgage Staff Cuts

By Richard H. Suttmeier

JPMorgan Chase & Co. (JPM) is the largest of the four “too big to fail” money center banks and is the only major bank in the Dow Jones Industrial Average.

Analysts expect JPMorgan to post earnings per share between $2.25 and $2.33 when the company reports before the opening bell on Oct. 12. JPMorgan’s status as the nation’s biggest bank and its largest balance sheet gives it an opportunity to continue a string of 11 consecutive earnings-per-share beats. JPMorgan remains the most important stock given its global banking activities. The fact that the bank has announced plans to cut 400 jobs in its consumer home lending division is a red flag.

https://www.investopedia.com/news/jpmorgan-reports-earnings-amid-mortgage-staff-cuts/

 

Sterling Price: GBPUSD Rallies Hard on Brexit Deal Chatter

By Nick Cawley

Late Tuesday a report circulated that the EU and UK were close to agreeing a Brexit deal, causing Sterling to pop higher against a range of currencies. While there was no official confirmation or comments on the report, the market is now starting to remove the ‘no-deal’ discount that has been priced into the market over the last few months. This shift now sees Sterling starting to further regain post-referendum losses and, if the report is true, would leave GBP set to rally much further.

Brexit news however has a habit of being misrepresented and traders/investors should wait to see for official confirmation from Brussels that an agreement is on the table. And the composition of the agreement could well be crucial to getting the UK Parliament to sign it off. UK PM Theresa May’s favored

option, Chequers, looks to be a non-starter with both the EU and many hardliners in the Tory Party, while the Canada+++ deal mooted by Michel Barnier and the EU is seen as a more practical, and workable deal.

GBPUSD now looks set to move higher after having broken above both 23.6% Fibonacci retracement at 1.30670 and the recent September 27 high at 1.31784.

https://www.dailyfx.com/forex/market_alert/2018/10/10/Sterling-Price-GBPUSD-Rallies-Hard-on-Brexit-Deal-Chatter-.html

 

World’s biggest traders see oil at $65-$100 a barrel next year

By Julia Payne, Dmitry Zhdannikov, Alex Lawler

The world’s biggest trading houses said on Wednesday they saw oil prices not falling below $65 per barrel and possibly breaking above $100 next year due to U.S. sanctions on Iran.

Oil has rallied this year on expectations the sanctions will test the production ability of the Organization of the Petroleum Exporting Countries and others as Iranian crude exports decline.

But in 2019, forecasters such as the International Energy Agency say emerging-market crises and trade disputes could dent global demand while rising non-OPEC production adds to supply.

Jeremy Weir, chief executive of Trafigura, said at an oil conference in London that he would not be surprised to see oil trade at more than $100 per barrel next year.

Alex Beard, chief executive for oil and gas at Glencore (GLEN.L), said at the same event that he sees the mid-term oil price at $85-90.

https://www.reuters.com/article/us-oil-conference-traders/worlds-biggest-traders-see-oil-at-65-100-a-barrel-next-year-idUSKCN1MK18S

 

Expect ‘extreme volatility’ for oil prices due to the Iran sanctions, BP CEO says

By Holly Ellyatt

  • “I think it’s going to be 45 days of extreme volatility, it could spike up, it could also go the other way,” he told CNBC’s Steve Sedgwick in London.
  • Some analysts predict as much as 1.5 million barrels per day could be removed from the market, an event that could cause prices to rise further.
  • On Wednesday, Brent crude futures were trading at $84.96 per barrel while U.S. West Texas Intermediate was trading at $74.92.

https://www.cnbc.com/2018/10/10/bp-ceo-says-oil-markets-will-see-extreme-volatility-iran-sanctions.html

 

European stocks lower as political uncertainty takes center stage

By Silvia Amaro

Traders are keeping an eye on political goings-on in Italy, as fears linger of a standoff between Rome and Brussels over the country’s 2019 budget.

Brexit continues to be an area of focus for the market, as the U.K. government faces pressure to reach a divorce deal with the EU before the end of the year.

Autos and basic resources were among the top losers. Overall, stock performances are struggling to make gains amid fears over global economic growth and rising interest rates in the U.S.

https://www.cnbc.com/2018/10/10/european-stocks-set-to-open-lower-amid-political-uncertainty-in-italy.html

 

Deutsche Bank upgrades Walmart to buy, citing growing online grocery business

By Tae Kim

Deutsche Bank raises its rating to buy from hold for Walmart shares, predicting the retailer will report sales above expectations in its third quarter.

It says Walmart’s online grocery business will thrive and compete well against Amazon.

Analyst Paul Trussell raised his price target to $113 from $89 for Walmart shares.

https://www.cnbc.com/2018/10/09/deutsche-bank-upgrades-walmart-to-buy-on-growing-online-grocery-business-.html

 

Why Facebook’s Oversold Shares Can Rise 30%

By Matthew Johnston

Facebook Inc. (FB) has fallen out of favor with many investors in recent months as the shares fell more than 25% from their record high back in July. But Facebook has the potential to rise sharply even as analysts slash their price targets. Argus Research’s Joseph Bonner, for one, thinks the sell-off has been overdone and sees it as an attractive buying opportunity. Bonner’s $210 target for Facebook was lowered from $237 previously, but it still amounts to a 33% gain in the stock, according to Barron’s. Bonner’s forecast is in line with the average price target for the social media giant.

Bonner concludes that the stock is trading at a bargain price.

While the bears argue that Facebook is beginning to peak and will see slower user growth, the company remains a dominant social-media platform with around 1.5 billion daily users and faces no major competition. It also has room to expand in the global advertising market and has yet to leverage ads on two of its major platforms, Facebook Messenger and WhatsApp. To the bulls, that offers plenty of upside for the stock.

https://www.investopedia.com/news/why-facebooks-oversold-shares-can-rise-30/

 

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