Stocks gain as earnings for third quarter roll in; Treasuries rally

Bloomberg

US equity-index futures rose with stocks in Europe as major Wall Street names began reporting earnings for the third quarter. Contracts on the S&P 500 trimmed some of their advance and Treasuries rallied as Bloomberg reported China may struggle to buy the volume of American goods proposed in the “phase one” trade deal.
The three main American equity indexes were all set open in the green after closing slightly lower on Monday. The Stoxx Europe 600 Index rose, with 18 of 19 sectors advancing led by retailer shares.
While Asian equities were mixed, Japan’s gauge jumped 1.6% as trading resumed after a long weekend during which President Donald Trump announced progress on an interim trade deal with China. On Tuesday Bloomberg reported the Asian nation will struggle to buy $50 billion of US farm goods annually unless it removes retaliatory tariffs on American products, and doing so would require reciprocal action by Trump.
The pound fluctuated as the European Union’s chief negotiator insisted a Brexit accord is possible this week, even though it’s getting “more and more difficult.” Crude oil futures dropped and gold edged higher.
The US earnings season began in earnest on Tuesday, with results rolling in from big banks including JPMorgan and Goldman Sachs. Investors will closely analyse the reports, given the global backdrop of slowing growth, falling interest rates and a host of unpredictable macro risks from the impeachment
investigation into Trump and the trade war to Brexit and Turkey’s incursion into Syria.
Meanwhile, the Turkish lira steadied and the country’s benchmark stock index rose after Trump imposed milder penalties over its military campaign in Syria than US lawmakers had demanded. Wednesday brings a monetary policy decision in South Korea.
US retail sales are forecast to increase for a seventh straight month. Sales in the “control group” are also expected to rise. Consumer spending is carrying the weight of US economic growth so the data will be monitored closely for any signs of slowing.
China releases third-quarter GDP, September
industrial production and retail sales data on Friday.
The Stoxx Europe 600 Index gained 0.4% in New York. Futures on the S&P 500 Index increased 0.2%. France’s CAC 40 Index climbed 0.5%. The UK’s FTSE 100 Index fell 0.4%. Turkey’s Borsa Istanbul 100 Index surged 1.3%.
The Bloomberg Dollar Spot Index declined 0.1%. The British pound jumped 0.4% to $1.2661. The euro dipped 0.1% to $1.1018. The Turkish lira climbed 0.4% to 5.9028 per dollar. The Japanese yen gained 0.2% to 108.17 per dollar.
The yield on 10-year Treasuries fell five basis points to 1.68%. The yield on two-year Treasuries fell five basis points to 1.54%. Germany’s 10-year yield dipped one basis point to -0.47%. Australia’s 10-year yield declined three basis points to 1.0175%.
West Texas Intermediate crude fell 1.8% to $52.61 a barrel. Gold rose 0.3% to $1,497.88 an ounce. LME nickel surged 2.2% to $16,910 per metric ton.