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Copper Tip Energy Services
Vista Projects
Copper Tip Energy
Vista Projects

Five Things to Know in World Business Today

These translations are done via Google Translate

Oct 2, 2018, by Lorcan Roche Kelly


Standing firm

Deputy Prime Minister Luigi Di Maio said the Italian government will not retreat by even a “millimeter” (0.04 inches) from its 2.4 percent budget deficit target. His comments come after euro-area finance ministers gave the proposal a cool reception at a meeting yesterday, with head of the European Commission going further and warning of a Greek-style crisis for the country. Adding to investor worries, Claudio Borghi, head of the lower house budget committee, said that the euro was “not sufficient” to solve Italy’s fiscal issues. The currency fell following his comments, with Italian bonds and stocks also suffering losses.

Oil rises again

Crude hit another four-year high, with a barrel of West Texas Intermediate for November delivery trading at $75.31 by 5:45 a.m. Eastern Time while Brent crude was at $84.54. Stoking the rally is the question of whether OPEC will be able to replace the Iranian exports being drained from global supply by U.S. sanctions. Russia is doing what it can. Its production rose to another post-Soviet high in September as the country completely rolled back the output cuts it had agreed with OPEC. Differences between the outlook for Brent and WTI have Citigroup Inc. warning that the U.S. benchmark could trade at a $15 discount to its global counterpart.

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Kavanaugh vote

Majority Leader Mitch McConnell said that the Senate will vote this week on Brett Kavanaugh’s Supreme Court nomination, adding that “the time for endless delay and obstruction has come to a close.” The rush to vote comes despite further revelations emerging about the nominee’s college drinking and a continuing FBI investigation. President Donald Trump said he wants a “very comprehensive” investigation into sexual assault allegations against Kavanaugh.

Markets drop

Overnight, the MSCI Asia Pacific Index declined 0.8 percent while Japan’s Topix index closed 0.3 percent higher as the new North American trade deal provided some relief for exporters. In Europe, the Stoxx 600 Index was 0.8 percent lower at 5:45 a.m. as Italian woes continued to dominate the investment scene in the region. S&P 500 futures pointed to a  drop at the open, the 10-year Treasury yield was at 3.056 percent and gold was higher.

Fed speak

This is a big week for speeches from the Federal Reserve. Today Fed Chair Jerome Powell will speak about the outlook for employment and inflation in Boston at 12:45 p.m. Fed Vice Chairman for Supervision Randal Quarles and Dallas Fed President Robert Kaplan are also taking to the podium today. Investors will watch these speeches closely. Rotating voting rights among regional Fed presidents mean interest-rate projections for next year could even range between two hikes and four, depending on which dots belong to which member.

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