July 19, 2017
(Bloomberg)
New threat to Obamacare, ECB said to look at QE options, and oil has new demand problem. Here are some of the things people in markets are talking about today.
Health-care scare
Hot on the heels of the failure of the Republican move to repeal and replace Obamacare, the next threat to the previous administration’s flagship piece of legislation could come before the weekend. The White House has so far not confirmed that it will pay the monthly subsidy — which helps low-income people access health care — due to insurers. The volatile politics surrounding Obamacare has already seen insurers pull back from the plan.
ECB options
The European Central Bank begins its two-day meeting today, and while economists expect no change when the decision is announced tomorrow, there are stimulus plans being drawn up at the bank for policy makers to consider when they return from the August break, according to euro-area officials familiar with the matter. For bond investors, the potential loss of the biggest buyer of euro government debt means some money managers are avoiding the asset class, while equity buyers are taking a closer look at corporate health following huge inflows to the region’s stocks during the ECB’s quantitative-easing program.
Oil demand
Just as OPEC’s resolve to continue to reduce production seems to wane, a demand problem may be emerging. China, the world’s biggest energy user, is set to see smaller-than-planned crude processing during the summer as efforts to cut pollution see some of the country’s drivers turn to cars fired up by natural gas. A barrel of West Texas Intermediate for August delivery was trading slightly higher at $46.50 at 5:40 a.m. Eastern Time ahead of U.S. inventories data.
Markets quiet
Overnight, the MSCI Asia Pacific Index added 0.3 percent, while Japan’s Topic index gained 0.1 percent ahead of the Bank of Japan decision on Thursday. In Europe, the Stoxx 600 Index had gained 0.3 percent by 5:40 a.m. following some positive earnings reports. S&P 500 futures were unchanged.
Not much else going on either..It is a quiet day in economic releases, with just mortgage applications data at 7:00 a.m. and housing starts and building permits numbers at 8:30 a.m. In earnings today, the most watched is likely to be Morgan Stanley, which will report before the bell with adjusted earnings per share estimated to come in at 77 cents. Overall, it looks like: volumes down, tinder swipes up.
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