Global markets traded mostly higher on Monday, following China’s recently undertaken economic stimulus measures, issued last Friday, amid concerns over the country’s flagging growth.
China’s central bank cut lenders’ reserve requirement ratios, a move that could see a free-up of 900 billion yuan ($126 billion), to finance projects that could encourage construction and sustain employment.
The announcement came just ahead of a China trade data release, for August, which had shown a slump in overall Chinese exports, in particular to the United States, as the trade dispute takes its toll.
Ahead, on Thursday, the European Central Bank is also expected to reveal a stimulus effort.
This falls shortly after US Federal Reserve Chairman, Jerome Powell’s, last speech before the Fed’s Sept. 17-18 policy-setting meeting, on Friday, where he had vowed to "act as appropriate" on interest rates in order to "sustain the expansion" of the world's lasrgest economy.
These market-friendly developments come after Friday’s close, where US stocks budgeted out a slight gain in the wake of a middling jobs report and an initial reaction to China’s easing of financial conditions.
The benchmark S&P 500 struggled for traction, but managed to carve out a +0.08% gain by the closing bell, having dipped into negative territory during the session.
Despite a minimal daily change, the equities index added +1.87% to its weekly value; its first back-to-back weekly gain since mid-July.
Coming up, Monday’s economic calendar is light, with Consumer Price Index and Retail Sales data for August scheduled for release later in the week.
In corporate news; Ctrip.com (CTRP) and Casey's General Stores (CASY) are amongst the major companies scheduled to report their most recent earnings data today.
TODAY'S TOP HEADLINES
Brexit: UK Parliament Will Be Suspended on Monday. (Bloomberg)
Beleaguered UK Prime Minister Boris Johnson traveled to Dublin for talks with his Irish counterpart, Leo Varadkar, as he pressed ahead with his hard-line plan to leave the European Union “do or die” by Oct. 31.
Today's Economical Announcements.
10:00AM - ★☆☆ - CB Employment Trends (Aug) (Previous: 111.0)
STOCKS IN THE SPOTLIGHT
Pre-Market Movers & News Related Stocks.
Eli Lilly (LLY): [NEWS] Said its experimental lung cancer drug LOXO-292 shrank tumors in almost 70% of advanced lung cancer patients. The drug was acquired earlier this year when Lilly bought Loxo Oncology for $8 billion.
Chipotle Mexican Grill (CMG): [UPGRADE] Wedbush upgraded the restaurant operator’s stock to “outperform” from “neutral,” and raised the price target by $200 to $980 per share. Wedbush thinks Chipotle is in position to establish a “digital moat” as the industry transitions to a larger mix of digital transactions.
PG&E (PCG): [NEWS] Was offered $2.5 billion by the city of San Francisco for its electrical lines serving the city. PG&E is trying to work its way out of bankruptcy, as it faces billions in liabilities for its role in a series of deadly California wildfires.
HP Inc. (HPQ): [DOWNGRADE] Downgraded to “market perform” from “outperform” at Bernstein, which said the computer and printer maker may face greater structural headwinds from the shift to digital communications.
Boeing (BA): [NEWS] Suspended load testing for its new 777X aircraft, saying its team “encountered an issue.” Boeing did not specify the problem, but media reports said a cargo door failed a ground stress test. The load testing places stress on jets that are well above normal conditions.
Amazon.com (AMZN): [NEWS] Is holding an “Amazon Career Day” in six cities on September 17, in an effort to fill more than 30,000 jobs by early next year. The positions are all full time with benefits, and are unrelated to the usual yearly increase in holiday season hiring.
E*Trade (ETFC): [DOWNGRADE] Downgraded to “market perform” from “outperform” at Keefe, Bruyette, & Woods, based on the firm’s expectations for the federal funds rate and treasury yields.
Energizer Holdings (ENR): [UPGRADE] Bank of America gave the shares a double upgrade, to “buy” from “underperform,” saying negative factors that it had previously highlighted were in the rear view mirror and that major risks are now known.
Royal Caribbean (RCL): [DIVIDEND] Declared a quarterly dividend of 78 cents per share, an 11% increase from the prior payout. The cruise line operator said the move reflected the company’s continuing efforts to increase shareholder returns. The stock is down almost 13% over the past 12 months although it has gained about 11% in 2019.
JP Morgan Chase (JPM): [NEWS] Is close to winning the lead advisory role for Saudi Aramco’s initial public offering, according to people with knowledge of the situation who spoke to CNBC.
Las Vegas Sands (LVS): [UPGRADE] Upgraded to “buy” from “hold” at Deutsche Bank, which said bearish sentiment regarding the Macau gaming market has created an attractive entry point for medium to longer term investors.
GAINERS: DOCU, CARB, GWRE, BOX
DECLINERS: DOMO, CRWD, PD, ZM, SMAR, VRNT, SMAR, CHGG
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