The US earnings season is in full flow and the optimism in equities is set to continue, with the S&P 500 Index trading just 2 per cent below its record high despite worrying signs about Chinese growth and stronger crude prices.
Ten-year Treasury yields also crossed 1.6 per cent, which suggests that bond markets are expecting a taper announcement by the US Federal Reserve as early as November. Despite this, the US dollar is finding stiff resistance at 94.50, where it has been trading lower since.
Third-quarter earnings opened with a bang this month and several big US banks announced stronger-than-expected gains during the period.
Five of the largest US banks – Morgan Stanley, Bank of America, Wells Fargo, Citigroup and JP Morgan Chase – all trumped their quarterly earnings expectations, reporting solid profits amid the continuing economic recovery from the Covid-19 pandemic despite rising inflation fears.
Meanwhile, the Dow Jones Index and the S&P 500 roared back to life after a sluggish September. Having pared their losses from last month, the S&P 500 is now 2 per cent off its record high and the Dow is sitting 1 per cent below its high.
The optimism for third-quarter earnings is expected to continue, with several large blue chips in the financial, technology and consumer goods segments reporting this week.
At the time of writing, Johnson & Johnson and Netflix were set to report their results on Tuesday afternoon US time, while technology heavyweights Tesla, ASML and IBM will follow suit on Wednesday.
I will be watching ASML closely – a stock I have written about previously. The Netherlands-based ASML, which manufactures complex lithography systems critical to the production of microchips, has a monopoly in the sector and is up 55 per cent this year.
ASML's recent move to sub-800 levels may provide an entry opportunity for those looking to pick up more technology exposure.
Consistent inflation threats and increasing murmurs of a Fed taper announcement as early as November could halt this year's bullish run
Gaurav Kashyap,
head of futures at EGM Futures
PayPal and Intel will announce their results on Thursday before the action picks up again next week, with heavyweights Facebook, Google, Amazon, Microsoft and Apple all set to report.
The coming weeks could establish a new trend for US equities. On the one hand, consistent inflation threats and increasing murmurs of a Fed taper announcement as early as November could halt this year's bullish run.
However, if these stronger earnings continue with the technology heavyweights beating expectations, this optimism would surely carry through to the end of the year.
The coming Fed action continues to remain the biggest unknown for markets while the recent run of uneven data does not help.
Last month’s US non-farm payrolls report was a big disappointment, garnering an increase of only 194,000 new jobs, well below the expected reading of 500,000.
Meanwhile, the next US third-quarter gross domestic product report, which is due out on October 28, is expected to show quarter-on-quarter growth of 3.2 per cent, down from a reading of 6.7 per cent in the second quarter.
Despite these factors, US 10-year Treasury yields crept back above 1.6 per cent – the highest since June – which would suggest bond markets are starting to more aggressively price in a taper next month.
All things considered, I expect the upwards momentum to continue in US equity markets for the remainder of October, with major volatility set to return early next month in the lead up to the Fed meeting on November 2 and 3.
Finally, data from China earlier this week showed that economic growth had slowed to 4.9 per cent from an expected 5.2 per cent, led largely by drags in the industrial and property sectors.
Contagion risk from the Evergrande fallout continues to plague investor sentiment in China and all eyes will be on the People’s Bank of China and what measures it may enact to loosen monetary policy. A cut to the reserve ratio requirement – the minimum amount prescribed by the central bank that a commercial bank must hold in liquid assets – is the most likely outcome.
Gold continues to consolidate in the mid-$1,700s on the Dubai Gold & Commodities Exchange (DGCX). Expect the precious metal to find support at $1,730 levels with resistance coming in at $1,790 levels. These ranges should hold until we have more clarity from the Fed in early November.
The star of the commodity segment continues to be crude oil, which was trading at seven-year highs on the DGCX this week.
The easing of supply bottlenecks and demand from global economies reopening continues to have a positive effect on fuel consumption, while a report last week by Opec and the International Energy Agency confirmed global supply shortages have kept crude bulls interested.
Gaurav Kashyap is head of futures at EGM Futures. The views and opinions expressed in this article are those of the author and do not reflect the views of EGM Futures
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How much sugar is in chocolate Easter eggs?
- The 169g Crunchie egg has 15.9g of sugar per 25g serving, working out at around 107g of sugar per egg
- The 190g Maltesers Teasers egg contains 58g of sugar per 100g for the egg and 19.6g of sugar in each of the two Teasers bars that come with it
- The 188g Smarties egg has 113g of sugar per egg and 22.8g in the tube of Smarties it contains
- The Milky Bar white chocolate Egg Hunt Pack contains eight eggs at 7.7g of sugar per egg
- The Cadbury Creme Egg contains 26g of sugar per 40g egg
Groom and Two Brides
Director: Elie Semaan
Starring: Abdullah Boushehri, Laila Abdallah, Lulwa Almulla
Rating: 3/5
Freezer tips
- Always make sure food is completely cool before freezing.
- If you’re cooking in large batches, divide into either family-sized or individual portions to freeze.
- Ensure the food is well wrapped in foil or cling film. Even better, store in fully sealable, labelled containers or zip-lock freezer bags.
- The easiest and safest way to defrost items such as the stews and sauces mentioned is to do so in the fridge for several hours or overnight.
New UK refugee system
- A new “core protection” for refugees moving from permanent to a more basic, temporary protection
- Shortened leave to remain - refugees will receive 30 months instead of five years
- A longer path to settlement with no indefinite settled status until a refugee has spent 20 years in Britain
- To encourage refugees to integrate the government will encourage them to out of the core protection route wherever possible.
- Under core protection there will be no automatic right to family reunion
- Refugees will have a reduced right to public funds
Terror attacks in Paris, November 13, 2015
- At 9.16pm, three suicide attackers killed one person outside the Atade de France during a foootball match between France and Germany
- At 9.25pm, three attackers opened fire on restaurants and cafes over 20 minutes, killing 39 people
- Shortly after 9.40pm, three other attackers launched a three-hour raid on the Bataclan, in which 1,500 people had gathered to watch a rock concert. In total, 90 people were killed
- Salah Abdeslam, the only survivor of the terrorists, did not directly participate in the attacks, thought to be due to a technical glitch in his suicide vest
- He fled to Belgium and was involved in attacks on Brussels in March 2016. He is serving a life sentence in France
Ferrari 12Cilindri specs
Engine: naturally aspirated 6.5-liter V12
Power: 819hp
Torque: 678Nm at 7,250rpm
Price: From Dh1,700,000
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SPEC SHEET
Display: 10.9" Liquid Retina IPS, 2360 x 1640, 264ppi, wide colour, True Tone, Apple Pencil support
Chip: Apple M1, 8-core CPU, 8-core GPU, 16-core Neural Engine
Memory: 64/256GB storage; 8GB RAM
Main camera: 12MP wide, f/1.8, Smart HDR
Video: 4K @ 25/25/30/60fps, full HD @ 25/30/60fps, slo-mo @ 120/240fps
Front camera: 12MP ultra-wide, f/2.4, Smart HDR, Centre Stage; full HD @ 25/30/60fps
Audio: Stereo speakers
Biometrics: Touch ID
I/O: USB-C, smart connector (for folio/keyboard)
Battery: Up to 10 hours on Wi-Fi; up to 9 hours on cellular
Finish: Space grey, starlight, pink, purple, blue
Price: Wi-Fi – Dh2,499 (64GB) / Dh3,099 (256GB); cellular – Dh3,099 (64GB) / Dh3,699 (256GB)
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Spider-Man: No Way Home
Director: Jon Watts
Stars: Tom Holland, Zendaya, Jacob Batalon
Rating:*****
SPECS
Nissan 370z Nismo
Engine: 3.7-litre V6
Transmission: seven-speed automatic
Power: 363hp
Torque: 560Nm
Price: Dh184,500
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2025 Fifa Club World Cup groups
Group A: Palmeiras, Porto, Al Ahly, Inter Miami.
Group B: Paris Saint-Germain, Atletico Madrid, Botafogo, Seattle.
Group C: Bayern Munich, Auckland City, Boca Juniors, Benfica.
Group D: Flamengo, ES Tunis, Chelsea, Leon.
Group E: River Plate, Urawa, Monterrey, Inter Milan.
Group F: Fluminense, Borussia Dortmund, Ulsan, Mamelodi Sundowns.
Group G: Manchester City, Wydad, Al Ain, Juventus.
Group H: Real Madrid, Al Hilal, Pachuca, Salzburg.
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More on Quran memorisation:
Tearful appearance
Chancellor Rachel Reeves set markets on edge as she appeared visibly distraught in parliament on Wednesday.
Legislative setbacks for the government have blown a new hole in the budgetary calculations at a time when the deficit is stubbornly large and the economy is struggling to grow.
She appeared with Keir Starmer on Thursday and the pair embraced, but he had failed to give her his backing as she cried a day earlier.
A spokesman said her upset demeanour was due to a personal matter.
The Perfect Couple
Starring: Nicole Kidman, Liev Schreiber, Jack Reynor
Creator: Jenna Lamia
Rating: 3/5
Polarised public
31% in UK say BBC is biased to left-wing views
19% in UK say BBC is biased to right-wing views
19% in UK say BBC is not biased at all
Source: YouGov
10 tips for entry-level job seekers
- Have an up-to-date, professional LinkedIn profile. If you don’t have a LinkedIn account, set one up today. Avoid poor-quality profile pictures with distracting backgrounds. Include a professional summary and begin to grow your network.
- Keep track of the job trends in your sector through the news. Apply for job alerts at your dream organisations and the types of jobs you want – LinkedIn uses AI to share similar relevant jobs based on your selections.
- Double check that you’ve highlighted relevant skills on your resume and LinkedIn profile.
- For most entry-level jobs, your resume will first be filtered by an applicant tracking system for keywords. Look closely at the description of the job you are applying for and mirror the language as much as possible (while being honest and accurate about your skills and experience).
- Keep your CV professional and in a simple format – make sure you tailor your cover letter and application to the company and role.
- Go online and look for details on job specifications for your target position. Make a list of skills required and set yourself some learning goals to tick off all the necessary skills one by one.
- Don’t be afraid to reach outside your immediate friends and family to other acquaintances and let them know you are looking for new opportunities.
- Make sure you’ve set your LinkedIn profile to signal that you are “open to opportunities”. Also be sure to use LinkedIn to search for people who are still actively hiring by searching for those that have the headline “I’m hiring” or “We’re hiring” in their profile.
- Prepare for online interviews using mock interview tools. Even before landing interviews, it can be useful to start practising.
- Be professional and patient. Always be professional with whoever you are interacting with throughout your search process, this will be remembered. You need to be patient, dedicated and not give up on your search. Candidates need to make sure they are following up appropriately for roles they have applied.
Arda Atalay, head of Mena private sector at LinkedIn Talent Solutions, Rudy Bier, managing partner of Kinetic Business Solutions and Ben Kinerman Daltrey, co-founder of KinFitz
The specs
AT4 Ultimate, as tested
Engine: 6.2-litre V8
Power: 420hp
Torque: 623Nm
Transmission: 10-speed automatic
Price: From Dh330,800 (Elevation: Dh236,400; AT4: Dh286,800; Denali: Dh345,800)
On sale: Now
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More from Rashmee Roshan Lall
The specs
Engine: 2.0-litre turbo 4-cyl
Transmission: eight-speed auto
Power: 190bhp
Torque: 300Nm
Price: Dh169,900
On sale: now
Who are the Soroptimists?
The first Soroptimists club was founded in Oakland, California in 1921. The name comes from the Latin word soror which means sister, combined with optima, meaning the best.
The organisation said its name is best interpreted as ‘the best for women’.
Since then the group has grown exponentially around the world and is officially affiliated with the United Nations. The organisation also counts Queen Mathilde of Belgium among its ranks.
