MARKET WRAPS

Watch For:

American Express results; Federal Reserve Bank of San Francisco President Mary Daly speaks at American Enterprise Institute virtual event on "Facing an uncertain world: The Federal Reserve and climate risk"

Opening Call:

Stock futures crept lower Friday, putting the S&P 500 on course to break a seven-day winning streak that included a fresh record high.

Stocks have risen in recent days on strong earnings, shaking off concerns about inflation and supply-chain problems that threaten the post-pandemic economic recovery. Nearly nine out of 10 U.S. companies that have reported earnings have beaten Wall Street expectations, said Mike Bell, a strategist at J.P. Morgan Asset Management.

In overseas news, China Evergrande Group, the heavily indebted property giant whose potential default had spooked markets, made an overdue interest payment to international bondholders, Chinese state-owned media reported Friday. The payment allowed the company to stave off default and helped ease investors' broader concerns about China's property sector.

Evergrande's shares rose almost 5% Friday, while the Lippo Select HK & Mainland Property index rose more than 3%. "We think the market priced in more bad news than was likely to come to fruition," Mr. Bell said.

The pan-continental Stoxx Europe 600, rose 0.3% led by its technology sector. Asian stock markets were mixed.

Stocks to Watch:

Intel CFO George Davis said adjusted sales next year should reach at least $74 billion, ahead of Wall Street forecasts, with revenue growth accelerating in subsequent years. Capital expenditures could reach $28 billion in 2022 and potentially grow further in the following years, he said.

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Snap plunged more than 21% before markets opened, after the company's earnings missed expectations. The group in part blamed Apple's new privacy features for disruptions to its advertising business.

Forex:

The dollar might be poised to recover after the DXY Index dropped to its lowest in more than three weeks on Thursday, as investors turned their attention to the prospects of the Fed scaling back monetary easing, said ING.

"A quite convincing U.S. earnings season is set to leave space for the more structural concerns about higher inflation and the prospect of Fed tightening, which, in our view, should provide the basis of a new gradual re-appreciation of the dollar in the next few weeks," said ING.

The euro slightly remained higher versus the dollar, shrugging off the latest eurozone purchasing managers' index survey.

The composite PMI, which measures manufacturing and services activity, fell to a six-month low of 54.3 in October from 56.2 in September with a level above 50 signalling growth. Economists polled by the WSJ expected a reading of 55.2.

The euro has been "quite unreactive" to recent PMI releases, said ING analysts. "We think we saw the short-term peak around 1.1660 in EUR/USD this week, and we are expecting the pair to move back below 1.1600 into the Fed November meeting."

Bonds:

Bond yields remain elevated in Europe, boosted Thursday as the market took note that the labor market looked to be strengthening as positive jobs data showed initial jobless claims last week fell to their Covid-19 pandemic low.

The yield on the benchmark 10-year U.S. Treasury note was down slightly from the six-month high of 1.7% reached in the last session, but was holding above 1.68%.

Commodities:

Oil futures were down 0.2% in Europe, with Brent on course to close at a weekly loss for the first time since late August, after prices came under pressure on Thursday following a broader selloff in commodities.

In addition, reported "comments from the Russian president that OPEC+ was increasing output slightly more than agreed [have] probably not helped sentiment," said ING's Warren Patterson.

Despite what might be a blip this week, inventories look to fall during the remainder of 2021, he added, meaning "oil prices will remain well supported."

Gold prices rose 0.6% as the dollar weakened and rising inflation expectations counteracted the impact of higher bond yields.

"Because market-based inflation expectations rose to a nine-year high...real yields actually fell slightly," said Daniel Briesemann, an analyst at Commerzbank. Still, investors continue to shun gold exchange traded funds, he added.

Gold ETFs tracked by FactSet had net outflows of roughly $459 million in the week through Thursday.

TODAY'S TOP HEADLINES

China Evergrande Makes Overdue Interest Payment on Dollar Bonds, State Media Says

China Evergrande Group made an overdue interest payment to international bondholders, the state-owned Securities Times reported Friday, an unexpected move that allows the property company to stave off a default.

The Chinese real-estate developer on Thursday sent $83.5 million to the trustee for the dollar bonds, and that financial institution will in turn pay bondholders, the Securities Times reported. The financial paper is run by the Communist Party's flagship People's Daily newspaper.

Read More ->

U.S. Issued $100 Billion in Export Licenses to Suppliers of Huawei, SMIC

The U.S. Commerce Department issued more than $100 billion worth of export licenses for semiconductors and other products to suppliers of Huawei Technologies Co. and another blacklisted Chinese tech company, as a global chip shortage started to bite.

The Commerce data, released Thursday by a Republican member of Congress, shows the department granted 113 export licenses worth about $61 billion for suppliers of telecom giant Huawei and 188 licenses valued at $42 billion for suppliers of Semiconductor Manufacturing International Corp., China's largest chip maker, from Nov. 9, 2020, through April 20 this year.

Read More ->

Moderna and J&J Covid-19 Boosters, Mixing and Matching Backed by CDC

Centers for Disease Control and Prevention Director Rochelle Walensky recommended Covid-19 booster shots from Moderna Inc. and Johnson & Johnson and backed mixing vaccines with a different booster dose.

With Dr. Walensky's greenlight Thursday, the vaccine doses can now become available at doctor's offices, pharmacies and vaccination sites on Friday, a CDC spokeswoman said. It follows unanimous recommendations from a panel of experts advising the CDC.

Read More ->

Western Digital-Kioxia Deal Talks Stall

Western Digital Corp.'s talks to merge with Japanese chip maker Kioxia Holdings Corp. in a $20 billion-plus deal have stalled, according to people familiar with the matter.

The companies, which had been speaking since early this year, were working to finalize a stock deal that would have created a memory-chip powerhouse worth something on the order of $40 billion, The Wall Street Journal reported in August. Though the talks are on hold now, they could still be revived, some of the people said.

Read More ->

J&J Talc Claims May Not Belong in Charlotte Bankruptcy Court, Judge Says

A bankruptcy judge said he is unsure if his North Carolina courtroom is the right venue for a Johnson & Johnson subsidiary to potentially settle tens of thousands of talc-related injury claims and suggested the case could be moved closer to the consumer goods giant's New Jersey headquarters.

Judge J. Craig Whitley of the U.S. Bankruptcy Court in Charlotte, N.C. also on Wednesday scheduled a November hearing over whether the J&J subsidiary placed into chapter 11 last week should be moved to a bankruptcy court in Delaware or New Jersey, where thousands of talcum-related injury lawsuits have been litigated for years.

Read More ->

American, Southwest Say Vaccine Mandate Won't Disrupt Flights

Airlines say they don't anticipate having to immediately fire employees not vaccinated by a federal deadline in December, another challenge for carriers managing travel's rocky recovery from the coronavirus pandemic.

Major airlines, which conduct business with the federal government, must require their workers to be vaccinated by Dec. 8 under an executive order signed by President Joe Biden in September pertaining to federal contractors.

Read More ->

Stellantis, Samsung SDI to Make EV Batteries in North America

French-Italian car maker Stellantis NV has entered into a memorandum of understanding with South Korean electronic component maker Samsung SDI Co. to make battery cells and modules for North America, it said Friday.

The move is part of Stellantis's plan to make electric cars represent 40% of its sales in the U.S. by 2030, the company said.

Read More ->

Whirlpool Doesn't See Appliance Shortage Ending Soon

Shortages of dishwashers and refrigerators are likely to stretch well into next year, Whirlpool Corp.'s chief executive officer said, as supply-chain problems constrain production and consumer demand remains strong.

The Benton Harbor, Mich.-based company has ramped up appliance production, but delays have grown as waits for components and other snags lead to back-orders of around six weeks for the average appliance, said Whirlpool CEO Marc Bitzer.

Read More ->

Vista Prepares Pitch for Next Big Software Fund

Vista Equity Partners plans to join the growing list of private-equity firms pitching large funds focused on technology deals.

The firm aims to soon open a virtual data room for its next big flagship buyout fund to allow prospective investors access to documents related to the offering, according to a letter sent to investors that was viewed by WSJ Pro Private Equity.

Read More ->

Biden Could Use National Guard to Help With Supply Chain Bottlenecks

WASHINGTON-President Biden said he would consider deploying the National Guard to assist with supply-chain bottlenecks that have led to shortages and higher consumer costs, if his administration is unable to ease the problem.

"The answer is yes, if we can't move-increase the number of truckers, which we're in the process of doing," Mr. Biden said during a CNN town hall on Thursday when asked about deploying the National Guard.

Read More ->

U.S. Issued $100 Billion in Export Licenses to Suppliers of Huawei, SMIC

The U.S. Commerce Department issued more than $100 billion worth of export licenses for semiconductors and other products to suppliers of Huawei Technologies Co. and another blacklisted Chinese tech company, as a global chip shortage started to bite.

The Commerce data, released Thursday by a Republican member of Congress, shows the department granted 113 export licenses worth about $61 billion for suppliers of telecom giant Huawei and 188 licenses valued at $42 billion for suppliers of Semiconductor Manufacturing International Corp., China's largest chip maker, from Nov. 9, 2020, through April 20 this year.

Read More ->

Investors Bet Inflation Pressures Will Linger

A key measure of investors' inflation expectations has climbed in recent weeks, adding fuel to concerns about rising consumer prices.

As of Wednesday, the gauge known as the 10-year break-even rate suggested that the consumer-price index will rise by an annual average of 2.57% over the next decade, according to Federal Reserve Economic Data, or FRED. That is up from a recent low of 2.28% in late September and the highest level since 2013.

Read More ->

Natural-Gas Prices Fall From Peak as Warm Autumn Buoys Stockpiles

Natural-gas prices have shed 19% since hitting a 13-year high earlier this month, reversing some of a run-up that has prompted fears of exorbitant heating bills and higher manufacturing costs at a time of already high prices.

A warm start to autumn is behind the decline. With most of the country yet to turn the heat on, gas has accumulated in storage facilities faster than expected and shrunk a deficit that prompted worries over winter price surges and even potential shortages.

Read More ->

Derby's Take: As Fed Balance Sheet Grows, Questions About Its Impact Remain

The Federal Reserve's newest governor this week pointed to an uncomfortable truth about the central bank's multitrillion-dollar balance sheet: Policy makers don't know for sure how it affects the economy.

"We have no economic theory of how large the central bank's balance sheet should be. I've never seen it," Christopher Waller said Tuesday in a virtual appearance.

Read More ->

Supply Bottlenecks Curb Eurozone Economic Growth to Six-Month Low in October

Eurozone business activity growth slowed sharply to a six-month low in October amid increasing supply bottlenecks and ongoing pandemic concerns, flash purchasing managers index data by IHS Markit showed.

The eurozone flash composite PMI fell to 54.3 in October from 56.2 in September, posting a decline for the third consecutive month.

Read More ->

Global Finance Watchdog Censures Turkey Over Money Laundering, Terrorist Financing

WASHINGTON-A global watchdog on Thursday added Turkey to its list of countries requiring special regulatory oversight for failing to stop money laundering and terrorist financing, a designation analysts say will rattle Ankara's already shaky economy.

The action means Turkey joins a group of 23 countries-including Zimbabwe, Haiti and Syria-that the Financial Action Task Force determined "have strategic deficiencies in their regimes to counter money laundering, terrorist financing, and proliferation financing."

Read More ->

Write to paul.larkins@dowjones.com TODAY IN CANADA

Earnings:

Corus Entertain 4Q

Economic Indicators (ET):

0830 Aug Retail Trade

Stocks to Watch:

Hammond Power 3Q EPS C$0.34; Sales C$95.5M

Expected Major Events for Friday

00:30/JPN: Oct Japan Flash Manufacturing PMI

05:00/JPN: Sep Steel Production

06:00/UK: Sep UK monthly retail sales figures

07:15/FRA: Oct France Flash PMI

07:30/GER: Oct Germany Flash PMI

08:30/UK: Oct Flash UK PMI

08:59/JPN: Aug Final Labour Survey - Earnings, Employment & Hours Worked

12:30/CAN: Aug Retail trade

13:45/US: Oct US Flash Manufacturing PMI

13:45/US: Oct US Flash Services PMI

14:00/US: Sep State Employment and Unemployment

All times in GMT. Powered by Kantar Media and Dow Jones.

Expected Earnings for Friday

1st Constitution Bancorp (FCCY) is expected to report $0.46 for 3Q.

ASA Gold & Precious Metals Ltd (ASA) is expected to report for 2Q.

Actinium Pharmaceuticals Inc (ATNM) is expected to report for 3Q.

Altra Industrial Motion Corp (AIMC) is expected to report $0.54 for 3Q.

American Express Co (AXP) is expected to report $1.80 for 3Q.

Bank of the James Financial Group Inc (BOTJ) is expected to report for 3Q.

Carter's Inc (CRI) is expected to report $1.74 for 3Q.

Chino Commercial Bancorp (CCBC) is expected to report for 3Q.

Cleveland-Cliffs Inc (CLF) is expected to report $2.10 for 3Q.

Corus Entertainment Inc - Class B (CJR.B.T,CJREF) is expected to report for 4Q.

Daseke Inc (DSKE) is expected to report $0.32 for 3Q.

Emclaire Financial (EMCF) is expected to report for 3Q.

Esquire Financial Holdings Inc (ESQ) is expected to report $0.62 for 3Q.

First Capital Inc (FCAP) is expected to report for 3Q.

First Hawaiian Inc (FHB) is expected to report $0.47 for 3Q.

Gentex Corp (GNTX) is expected to report $0.37 for 3Q.

Gorman-Rupp Co (GRC) is expected to report $0.34 for 3Q.

Greene County Bancorp (GCBC) is expected to report for 1Q.

HCA Healthcare Inc (HCA) is expected to report $4.19 for 3Q.

Honeywell International Inc (HON) is expected to report $2.01 for 3Q.

MetroCity Bankshares Inc (MCBS) is expected to report $0.61 for 3Q.

Norwood Financial Corp (NWFL) is expected to report for 3Q.

PFB Corp (PFB.T) is expected to report for 3Q.

PFSweb (PFSW) is expected to report $-0.11 for 2Q.

Regions Financial Corp (RF) is expected to report $0.54 for 3Q.

Roper Technologies Inc (ROP) is expected to report $2.77 for 3Q.

Schlumberger (SLB) is expected to report $0.36 for 3Q.

Seagate Technology Holdings PLC (STX) is expected to report for 1Q.

Simply Good Foods (SMPL) is expected to report $0.23 for 4Q.

Toast Inc (TOST) is expected to report for 3Q.

Tompkins Financial (TMP) is expected to report $1.44 for 3Q.

Towne Bank (TOWN) is expected to report $0.67 for 3Q.

United Bankshares Inc (UBSI) is expected to report $0.66 for 3Q.

VF Corp (VFC) is expected to report $1.13 for 2Q.

Powered by Kantar Media and Dow Jones.

ANALYST RATINGS ACTIONS

Aramark Raised to Buy From Hold by Berenberg

Avaya Holdings Cut to Equal-Weight From Overweight by Barclays

Carnival Raised to Hold From Sell by Berenberg

Contura Energy Raised to Overweight From Neutral by Piper Sandler

Denny's Raised to Buy From Hold by Truist Securities

Krispy Kreme Cut to Hold From Buy by HSBC

Lam Research Cut to Hold From Buy by Summit Insights Group

LivePerson Cut to Underweight From Equal-Weight by Barclays

TCR2 Therapeutics Cut to Market Perform From Outperform by SVB Leerink

Wintrust Cut to Neutral From Buy by Janney Montgomery Scott

This article is a text version of a Wall Street Journal newsletter published earlier today.

(END) Dow Jones Newswires

October 22, 2021 05:50 ET (09:50 GMT)

Copyright (c) 2021 Dow Jones & Company, Inc.