Asia: Japan +7.7% to 18771. Hong Kong +4.1% to 22131. China +2.3% to 3243. India +1.5% to 25707.
Europe: London +1.9%. Paris +2.4%. Frankfurt +1.7%.
Futures: Dow +1.2%. S&P +1.1%. Nasdaq +1.25%. Crude -0.4% to $45.76. Gold flat at $1120.80.
Ten-year Treasury Yield +3 bps to 2.3%.
7:00 MBA Mortgage Applications
8:55 Redbook Chain Store Sales
10:00 Job Openings and Labor Turnover Survey
Japan’s Nikkei index has surged 7.7% amid a rally in global equities, helped by the prospect of corporate tax cuts, further stimulus in China and overselling. Prime Minister Shinzo Abe has pledged to cut rates by 3.3 percentage points from 35% from next year and wants to eventually lower tax into the twenties as he looks to revive Japan’s stuttering economy.
China’s finance ministry has unveiled yet more stimulus as it again bids to re-spark the country’s slowing economy, which was exemplified by poor trade figures yesterday. The government intends to cut taxes for small businesses and allocate further funds for infrastructure projects, with two railway projects worth almost 70B yuan ($11B) being approved. The Shanghai Composite added to yesterday’s gains but volumes are desperately thin following the recent turmoil.
The pound took a dive following the release of disappointing U.K. output and trade data. Industrial production fell 0.4% on month in July vs consensus of +0.1%, while manufacturing production dropped 0.8% on month vs +0.2%. Exports tumbled 9.2% for the largest decline in nine years, helping explain why factory output fell.
United Airlines Chairman and CEO Jeff Smisek has stepped down from both roles amid a federal investigation into whether the company traded favors with the chairman of the Port Authority of New York & New Jersey. United Airlines (UAL) COO Oscar Munoz has become CEO and independent director Henry Meyer non-executive chairman. United’s EVP of communications and government affairs and its SVP of corporate and government affairs have also left.
Apple is today due to unveil the latest versions of the iPhone, the 6S and 6S+, at an event in San Francisco, where it is also expected to introduce a bigger iPad and the opening of Apple TV (AAPL) to third party app developers. Upgrades to the iPhone are likely to include much-improved cameras, as well as Force Touch, which allows users to open features by pressing down harder on the screen and has been used in the Apple Watch.
Toyota has introduced a revamped Prius in the first major redesign of the pioneering hybrid car in seven years. Toyota (TM) has given the vehicle a more sporty look with the addition of a spoiler and has improved fuel economy by 10% to 55 miles a gallon. Although the company is looking to boost flagging Prius sales, the timing of the launch isn’t great – competition has heated up in the alternative-fuels sector while low oil prices have anyway reduced demand for fuel-efficient cars.
Netflix intends to launch its TV and movie streaming services in South Korea, Singapore, Hong Kong and Taiwan early next year as the company continues its plans for world domination. The news comes after Netflix (NFLX) entered Asia last week by opening in Japan and as it explores its options in China. By the end of 2016, Netflix wants to be in 200 countries.
A British Airways Boeing 777 caught fire late yesterday as it was taking off from Las Vegas’ McCarran International Airport. The pilot was able to abort the takeoff and all 172 passengers and crew escaped the Boeing (BA) jet, although 14 people were taken to hospital. A preliminary investigation shows that the plane’s left engine, which was made by GE (GE), burst into flames as the plane started to accelerate down the runway. British Airways is a unit of International Consolidated Airlines Group (OTCPK:ICAGY).
Aerojet Rocketdyne has submitted a $2B offer to buy United Launch Alliance, a 50-50 joint venture of Lockheed Martin (LMT) and Boeing (BA), Dow Jones reports. The sides are in advanced talks about a deal and an announcement could come early next week. Lockheed and Boeing might welcome Aerojet’s (NYSE:AJRD) bid, given that increased competition from SpaceX is likely to cut into ULA’s revenues and earnings in coming years.
ABB has lowered its growth revenue target to 3-6% until 2020 from 4-7% previously. The Swiss industrial company will also accelerate its restructuring program as it looks to save $1B a year by the end of 2017. ABB (ABB) is under pressure from Cevian, a Swedish activist investor that has built up a stake of over 5%. The company has been suffering from the slowdown in China and a fall in oil prices that has hurt sales to customers in the upstream energy sector.