By Lorcan Roche Kelly
European Commission President Jean-Claude Juncker says a new Brexit deal has been reached. The pound surged higher on the announcement having earlier slumped when Northern Ireland’s DUP said they would not support the current text. Following the announced deal, the party said its position was unchanged. With an agreement now reached in Brussels, attention will turn to Westminster on Saturday to see if the deal can pass a parliamentary vote.
China says its officials continue to work on the text of an agreement on trade with U.S. negotiators, even as the diplomatic situation seems to be deteriorating. Yesterday authorities in Beijing warned of “strong countermeasures” if the U.S. enacts legislation backing pro-democracy demonstrators in Hong Kong, and today accused the State Department of violating the Vienna Convention with new rules requiring Chinese diplomats to give official notice before visiting universities or research institutions.
The better-than-expected earnings season for big banks faces another test this morning when Morgan Stanley reports. Bloomberg Intelligence says the lender’s trading performance will be the key metric to watch in a quarter that’s expected to show a drop in equity and fixed-income revenue. Shares in Netflix Inc. rose as much as 11% in late trading after the company posted results that allayed fears about looming competition from Walt Disney Co. and Apple Inc.
Overnight the MSCI Asia Pacific Index added 0.2% while Japan’s Topix index closed 0.5% lower after hitting the highest level of the year on Wednesday. In Europe, the Stoxx 600 Index was 0.7% higher at 5:50 a.m. Eastern Time as investors in the region reacted positively to the breakthrough in Brexit negotiations. S&P 500 futures also rose, the 10-year Treasury yield was at 1.790% and gold was lower.
Weekly initial jobless claims and September U.S. housing starts numbers are published at 8:30 a.m. The Philadelphia Fed Business Outlook is also due at that time. Industrial production and manufacturing data is released at 9:15 a.m. Industry data suggested a sharp jump in crude inventories ahead of the numbers being released at 11:00 a.m. Chicago Fed President Charles Evans, Fed Governor Michelle Bowman and New York Fed President John Williams are today’s monetary policy speakers.