US benchmarks trading higher ahead of the open
S&P500 back at the 3000 handle
Morgan Stanley to rise after strong earnings
US indices have traded up to their highest level in almost a month ahead of the cash open with sentiment receiving a boost after some upbeat remarks on the trade front from the far east and the announcement of a new Brexit deal - having said that, it should be noted that the strong push higher in the pound has since reversed and therefore this may no longer be seen as that positive.
US stocks remain well supported and the S&P500 (US500 on xStation) is now back at the 3000 level and just under 1% from its all-time high of 3029. Source: xStation
A batch of data from the US has come out in the past hour with the overall tone somewhat mixed. The Philly Fed manufacturing index missed the expected 7.3 in coming in at 5.6 after 12.0 prior, only the second time in the past 6 months that this measure has missed consensus forecasts. Construction data was good and bad with building permits topping estimates (1.39M vs 1.34M exp. 1.43M prior - 1.42M originally) but actual housing starts came in on the low side (1.26M vs 1.32M exp. 1.36M prior). Unemployment claims continue to suggest a strong labour market with the weekly read of 214k marginally above both the expected (212K) and the prior (210K).
On the earnings front Morgan Stanley is worth a mention after the investment bank notched up a strong third quarter performance with fixed income sales and trading two of the brightest spots. The smallest of the “big six” on Wall Street reported Q3 net income of $2.2B, marking a 3% rise on the same period last year and well above the street estimate of $1.8B. Revenues of $10B beat the expected $9.6B and marked a 2% rise Y/Y. On the whole it’s not been a great earnings season for banks, but this is one of the highlights and it is little surprise that the stock is called to start firmly higher this afternoon.
Morgan Stanley shares are set to open higher this afternoon with price likely to begin back above the 200 day SMA. The stock has oscillated around this trend identifier for the past 6 months or so but it is worth nothing that the gradient is now starting to turn higher and could be seen to support an uptrend. Source: xStation