- Reuters/Mike Blake
Here is what you need to know.
Fed rate hike odds keep sliding. The market is pricing in just an 18% chance the US Federal Reserve will raise rates at its September meeting, according to data compiled by Bloomberg. Additionally, the market sees just a 49.7% probability of a Fed rate hike before the end of 2016.
Germany’s 10-year is back below zero. A solid bid has pushed the yield on 10-year German bunds down 5 basis points to -2.1 bps, dropping it back below zero for the first time in a week. The benchmark yield set a record low -19 bps in the wake of the United Kingdom’s decision to leave the European Union.
Russia’s central bank cut rates. The Central Bank of Russia lowered its benchmark interest rate 50 basis points to 10.00%, as expected. According to the CBR, “Inflation has demonstrated a noticeable decline in line with the Bank of Russia’s baseline forecast.” The Russian ruble is weaker by 0.5% at 65.0630 per dollar.
The US is going after Deutsche Bank. The US Department of Justice has asked Deutsche Bank to pay $14 billion to settle a probe into the bank’s dealings in mortgage securities between 2005 and 2007, the Wall Street Journal reports. Shares of Deutsche Bank are down 8% on the news.
The world’s largest hedge fund is planing layoffs. Ray Dalio’s Bridgewater Associates sent out a letter to clients saying it is “bloated” and will “improve efficiencies” of its non-investment teams.
Oracle posts an earnings miss. The company missed on both the top and bottom lines, earning $0.55 per share on revenue of $8.6 billion.
The iPhone 7 hits stores on Friday. Apple stores will open at 8 a.m., earlier than usual, for the occasion.
Trivago is getting ready to go public. Expedia has chosen JP Morgan, Goldman Sachs and Morgan Stanley to coordinate is Nasdaq-based initial public offering for its travel search site, Trivago, Reuters reports.
Stock markets around the world are mixed. Australia’s ASX (+1.1%) led a quiet session in Asia as China’s Shanghai Composite and Hong Kong’s Hang Seng were closed in observance of Mid-Autumn Festival. In Europe, Spain’s IBEX (-0.8%) paces the decline. S&P 500 futures are down 9.75 points at 2,128.25.
US economic data flows. CPI will be released at 8:30 a.m. ET and University of Michigan consumer confidence will cross the wires at 10 a.m. ET. Then, at 1 p.m. ET, the Baker Hughes rig count will be announced. The US 10-year yield is down 2 bps at 1.67%.