Morning Update

Markets Go Looking for a Shot of Espresso

Global markets are lower as weak company earnings continue to weigh on investor confidence. Starbucks and Toll Brothers reported disappointing results. Dow member American Express received approval to become a commercial bank, while Citigroup became the latest bank to institute a plan to revise mortgages. Treasuries are closed today in observance of the Veterans Day holiday.

As of 8:25 a.m. ET, the December S&P 500 Index Globex futures contract is 13 points below fair value, the Nasdaq 100 Index is 17 points below fair value, and the DJIA is 114 points below fair value. Crude oil is down $2.52 to $59.89 per barrel, and gold is down $13.00 per ounce at $733.50. The three-month LIBOR rate fell 6 bp to 2.18%. There is no setting for the overnight LIBOR and no trading in the bond market today in observance of the Veterans Day holiday.

Light economic day

No major economic releases are scheduled for today and there will be no trading in the bond market due to the observance of the Veterans Day holiday.

European shares under pressure

Despite an increase in investor confidence, shares in Europe are lower as investors continue to digest data demonstrating the slowdown in economies globally. The ZEW Survey out of Germany showed investor confidence unexpectedly improved during the month of November to -53.5 from -63.0 in October. Economists were expecting an unchanged reading. Investors were encouraged by recent rate cuts and stimulus actions.

Asian markets slide

Asian markets followed the decline in the US markets yesterday, as initial optimism from the Chinese stimulus plan waned. The reality that the spending will take time to impact economies weighed on investors. Investors took profits in materials companies, which were the leading gainers yesterday. The Japanese Nikkei 225 Index declined by 3.0%, led by declines in exporters Canon (CAJ $34) and Honda Motor Co (HMC $23), which were down 8% and 5%, respectively.