Breaking News
Ad-Free Version. Upgrade your experience. Save up to 40% More details

GDP, Jobless Claims, ECB and Big Tech Earnings - What's up in Markets

Stock MarketsOct 29, 2020 19:34
Saved. See Saved Items.
This article has already been saved in your Saved Items
© Reuters.

By Geoffrey Smith -- Big Tech reports in the shape of Apple (NASDAQ:AAPL), Amazon (NASDAQ:AMZN), Alphabet (NASDAQ:GOOGL) and Facebook (NASDAQ:FB); the U.S. will publish third-quarter GDP figures that will break records but not bring GDP back to where it was before the pandemic; weekly jobless claims will give a more up-to-date look at the state of the economy; the European Central Bank meets a day after France and Germany tightened their public health measures to stop the coronavirus, and central banks became net sellers of gold for the first time in a decade in the third quarter. Here's what you need to know in financial markets on Thursday, October 29th.

1. Big Tech Earnings

It’s peak earnings season, with Apple, Amazon, Facebook and Alphabet all reporting after the close. The earnings again come only a day after some of their CEOs were in Congress, the timing thus sparing them the embarrassment of having to defend their monopoly profits at a time of widespread hardship across the economy.   

The sell-off in Microsoft (NASDAQ:MSFT) stock after it beat expectations on Tuesday night has generated some caution among analysts, amid signs that investors are starting to worry about sky-high valuations for a bunch of Big Tech names that have been seen by many as a safe haven from the rout elsewhere in the market this year.

Of interest to Apple may be news overnight that rival Samsung (KS:005930) posted its biggest profit in 18 months, thanks to a rebound in smartphone sales and strong demand for memory chips. The company is also positioning itself to substitute for Huawei in parts of the wireless networks business.

2. Q3 GDP, jobless claims due

The U.S. will report gross domestic product figures for the third quarter at 8:30 AM ET, along with the weekly jobless claims report.

Of the two, there’s no question which is the more important as regards the current dynamic of the economy: the weekly jobless numbers are much more up to date and have a more direct impact on consumer and voter sentiment with less than a week to go before the elections.

However, it’s the GDP figures that will likely grab more attention, if only because of the exaggerated numbers generated by annualizing the numbers. Analysts expect an annualized increase of 31% that, while unprecedented in superficial terms, still won’t bring actual GDP back up to its pre-pandemic level.

If anyone still has attention to spare after that, pending home sales data are due at 10 AM ET.

3. Stocks set for weak bounce; old economy updates supportive

U.S. stocks are set to open with the weakest of bounces after their worst day in four months on Wednesday, helped by some reassuring corporate updates overnight but still overshadowed by the spread of the Covid-19 virus across the U.S. and Europe.

By 7:30 AM ET (1130 GMT), Dow 30 futures were up 63 points, or 0.2%, while S&P 500 Futures were up 0.4% and NASDAQ Futures were up 0.7%.

Even before the Big Tech earnings-fest this evening, there are plenty of updates to grab the attention: Comcast (NASDAQ:CMCSA) beat expectations thanks in part to a strong debut for its Peacock streaming service, while Anheuser Busch Inbev (NYSE:BUD) rose 3.2% in Europe after reporting strong sales in the U.S. and Brazil that overshadowed a dividend cut. Royal Dutch Shell (LON:RDSa) meanwhile raised its dividend, only six months after an epoch-making cut.

Shopify (NYSE:SHOP) and Kraft Heinz (NASDAQ:KHC) also reported stronger-than-expected sales for the quarter, while Tiffany's (NYSE:TIF) deal with LVMH (OTC:LVMUY) will go ahead after the two sides agreed a modest cut in LVMH’s offer price.

4. ECB set to meet as BoJ cuts growth forecast

The European Central Bank meets in Frankfurt, with the big question being whether it will react immediately to the tightening of restrictions on economic and social life in Germany and France that was announced on Wednesday.

Consensus is still that the ECB will wait until December to announce any new moves. But to keep markets happy, Christine Lagarde may signal an increase in bond purchases through the 1.35 trillion euro ($1.5 trillion) Pandemic Emergency Purchase Program at her press conference, which begins at 9:30 AM ET (1330 GMT).

Overnight, the Bank of Japan made no change to its monetary policy, but said the Japanese economy will shrink by 5.5% in the year through March, more than the 4.7% contraction it had previously forecast.

5. Central banks sell gold for first time in a decade

Central banks were net sellers of gold in the third quarter for the first time in over a decade, cashing in on the record high prices created by investor demand for hedging against pandemic risks.

According to the World Gold Council, the central banks of Turkey and Uzbekistan – both of which face intense balance of payments challenges – were the biggest sellers.

Central banks had fueled the rally in gold between 2014 and 2018, bolstering their reserves as confidence in the world economy led the previous rally in bullion to unwind. The other main pillar of demand for physical gold, from jewelry buyers in China and India, has also weakened markedly in recent months as prices have soared, the WGC said. Indian jewelry demand, in particular, was down by around 50%.

GDP, Jobless Claims, ECB and Big Tech Earnings - What's up in Markets

Related Articles

Zumiez Jumps on up to $150 Million Share Buyback Plan
Zumiez Jumps on up to $150 Million Share Buyback Plan By - Sep 17, 2021

By Dhirendra Tripathi – Zumiez stock (NASDAQ:ZUMZ) climbed 6% Friday after the company said it will repurchase shares worth $150 million. The buyback will close on...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email