The Friday Market Minute

  • Global stocks book quarter-end gains despite US. political turmoil, with weaker domestic currencies supporting equity prices.
  • US lawmakers move forward on Trump impeachment inquiry after whistleblower report suggest a potential cover-up of allegations linked to a phone call with the Ukrainian President. 
  • Euro trades at two-year low against the dollar, boosting regional stocks, while the pound extends its slump amid Britain's roiling Brexit chaos.
  • Oil prices edge lower as uncertain demand , as well as near-term return to full capacity in Saudi Arabia, weighs on global crude markets.
  • Wall Street futures suggest a solid start to the trading day on Wall Street after a stronger-than-expected reading for August durable goods orders and a core inflation reading that was largely in-line with forecasts

Market Snapshot

Wall Street futures traded higher Friday, while stocks booked solid gains in markets around the world, as investors used weaker domestic currencies to re-price risk over the final trading days of the third quarter while cautiously monitoring developments in the impeachment case against President Donald Trump.

Democratic lawmakers released details yesterday of a White House whistleblower's allegations that Trump used the threat of withheld foreign aid to elicit support from the Ukrainian government to investigate one of his domestic political rivals.

The report also noted the Trump administration's decision to load a transcript of the phone call during which Trump was alleged to have made the request "into a separate electronic system that is otherwise used to store and handle classified information of an especially sensitive nature."

House Speaker Nancy Pelosi called the move a "cover up" and vowed to press ahead with her impeachment inquiry into the President, adding to investor concerns that the affair could lead to a market-damaging showdown between the country's two most powerful political leaders.

Still, even with the threat of a partisan impeachment battle looming, and the ongoing trade dispute between Washington and Beijing unresolved, investors were willing to add to risk positions in the next-to-last trading day of the quarter.

U.S. equity futures suggest a positive start to the session on Wall Street, with contracts tied to the Dow Jones Industrial Average indicating an 63 point gain while those linked to the S&P 500, which has gained around 1.2% so far this quarter, primed for an 8.4 point advance.

Bank of America Merrill Lynch data, however, suggests investors are moving cash out of U.S. equities at one of the fastest rates on record, with some $16.4 billion in outflows from domestic equity funds in the week ending on Wednesday.

Globally, BAML's 'Flow Show' report indicated, around $22 billion flowed from stock portfolios, with precious metals seeing their second-largest gain -- 2.8 billion -- on record over the same period.

Wells Fargo (WFC) - Get Report shares were a notable early market mover, rising 3% after the scandal-plagued banking group named industry veteran Charles Scharf as CEO of the country's fourth-largest lender. 

The U.S. dollar index, which tracks the greenback against a basket of six global currencies, held onto recent gains and traded at 99.20, pushing the European single currency to a near two-year low of 1.0918 and the pound to a multi-week low of 1.2295.

The currency moves helped regional stocks book solid Friday gains, with the Stoxx 600 Europe benchmark rising 0.4% and Germany's DAX performance index adding 0.53%.

In Britain, rate cut hints from a Bank of England policymaker added to downward pressure on the pound, which in turn boosted the value of stocks on the FTSE 100, most of which earn their profits in non-U.K. currencies, taking the benchmark 0.9% higher by mid-morning.

Global oil prices extended declines Friday amid reports of a partial ceasefire between Saudi Arabia and Yemen, a move that could ease investors concerns over attacks on tankers and refining facilities in the Gulf region.

Brent crude contracts for November delivery, which soared the most in more than three decades during the first trading session following drone attacks on the Abqaiq and Khurais facilities, were marked $1.22 lower from Thursday's New York close to trade at $61.48 per barrel.

WTI contracts for the same month, which are more tightly linked with U.S. gasoline prices, were last seen $1.34 lower from their Thursday close at $55.07 per barrel.