Breaking News

Opening Bell: Trumpenomics Roil Markets As Central Banks Eyed

By Market OverviewJan 31, 2017 07:09AM ET
Opening Bell: Trumpenomics Roil Markets As Central Banks Eyed
By   |  Jan 31, 2017 07:09AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items

by Eli Wright

The US dollar remains soft and global equity markets continue to struggle as concerns about President Trump’s travel policies and the risk to US businesses unnerve investors. The VIX moved decisively, up 12.29%, to 11.88, although that is still well below the trailing 12-month average of 14.58. Safe-haven commodities, including gold and silver are higher.

Alongside politics and US earnings reports, over the next several days, traders and investors will also be monitoring guidance from three central banks—the BoJ, Fed and BoE—rather than rate changes which are not expected. Overnight, the Bank of Japan raised its growth forecast to 1.4% from the 1.0% prediction it made last October, though it left monetary policy and interest rates unchanged. The Fed and Bank of England are scheduled to announce rate decisions tomorrow and Thursday, respectively. Neither is expected to surprise, but the forecasts provided could be key.

Markets in China and Hong Kong remained closed for the lunar New Year, but the Nikkei fell 1.69%, to close at 19,041.3.

In Europe, markets started the day on an upbeat note following better-than-expected French and Spanish CPI, positive German unemployment figures, and better-than-anticipated eurozone CPI and GDP data. The FTSE is up 0.2% to 7,130.75; the DAX is 0.11% higher, at 11,693.50; and the Stoxx 50 has gained 0.32%, to 3,269.50.

On Wall Street yesterday, major indices experienced their worst declines of the year. The Dow fell back below 20K, dropping 0.61%, to close at 19,971.13. The S&P 500 fell 0.6% to 2,280.90; and the NASDAQ dropped 0.83% to 5,613.71.

In pre-market trading, all three major US indices—the Dow, S&P, and NASDAQ—are down approximately 0.2%.

However, investor leeriness could fade if the new administration delivers upbeat news on fiscal reform. Yesterday, Trump signed an executive order saying that for every new regulation introduced, two must be revoked. Though there will be exceptions, and the order does not apply to the military or national security, the primary goal of this policy is to cut regulations for small and large businesses.

Additionally, though Senate Democrats delayed a vote on Trump's pick for Treasury Secretary Steve Mnuchin yesterday, the committee will reconvene again today. If Mnuchin is confirmed, which is likely given that he made it through his confirmation hearing, he could immediately start working on new fiscal policies.

Turning to US Treasurys, the yield curve may be signaling uneasiness with Trump's fiscal policies; the 10-year note has steepened sharply versus the 2-year. The 2-year yield is down to 1.208%, but the 10- and 30-year year yields are both higher, to 2.498% and 3.094% respectively.


The Dollar Index is down 0.36% at time of writing, to 100.07. Overall though it’s been indecisive over the past four days, trading in a tight +/-0.85% range.

Dollar Index Daily Chart
Dollar Index Daily Chart

The euro is higher, up 0.56% to 1.0755 on the upbeat euro area economic data released earlier.

The yen up 0.29%, higher today versus the greenback, at 113.44. It is up one percent since the start of the week.

The Swiss franc is 0.33% higher today, to 0.9922. Though bulls and the bears are still fighting it out around the key 1.00 benchmark of 1.00, an upside move could be in the cards. USD/CHF could head toward 1.03, though it's also possible the pair could fall to 0.97.


Oil prices have dipped as traders await API US inventory figures which will be released later today. Crude oil is down 0.6% at $52.32, while Brent is 0.52% lower, at $55.03.

Precious metals are higher this morning as risk-off sentiment dominates, making safe-havens of all sorts attractive. Gold is up 0.27% again challenging the $1,200 benchmark, at $1,199.25, while silver is up 0.15%, to $17.172. According to Matthew Ashley, research analyst at Blackwell Global:

“Market uncertainty could cap downside risks in the long-term.”


More than 100 companies are scheduled to report quarterly earnings today. Among them:

  • Apple (NASDAQ:AAPL) is expected to report Q1 2017 earnings per share of $3.22 on revenue of $76.54 billion after the market close. The holiday season is typically Apple’s strongest, plus it's possible the iPhone manufacturer was also able to capitalize on Samsung (KS:005930)'s (OTC:SSNLF) termination of the Galaxy Note 7 this past October.
  • ExxonMobil (NYSE:XOM) announces Q4 2016 earnings, with expected EPS of $0.70 on $70.24 billion, before the bell. Moving forward, the company will look to take advantage of stabilizing oil prices.
  • Big Pharma behemoths Pfizer (NYSE:PFE) and Eli Lilly (NYSE:LLY) both report as well: Pfizer is expected to post Q1 2017 EPS of $0.5 on $13.61 billion in revenue, while Eli Lilly is expected to report Q4 2016 EPS of $0.97 on revenue of $5.61 billion. Each company will be looking to show strong sales growth for existing drugs while providing guidance regarding product pipelines.
  • Mastercard's (NYSE:MA) Q4 2016 earnings will be released this morning; EPS is expected to come in at $0.86 on $2.79 billion in revenue.
  • Health insurance provider Aetna (NYSE:AET) is expected to report Q4 2016 earnings per share of $1.44 on revenue of $15.78 billion. Last quarter, Aetna came under pressure from the Affordable Care Act, and in August announced that it had lost $430 million on Obamacare since 2014.
  • Electronic Arts (NASDAQ:EA), the maker of popular video games such as Madden, FIFA, and Battlefield, reports Q3 2017 earnings after the close, with expected EPS of $2.30 on revenue of $2.03 billion.
  • Sports apparel maker Under Armour (NYSE:UA) is set to announce Q4 2016 earnings per share of $0.25 on $1.42 in revenue. UA shares have fallen close to 30% since January 2016, and the company will look to lure investors back by showing strong sales growth and international expansion.

A quick note on Teva Pharmaceuticals (NYSE:TEVA): shares are down 8% in pre-market trading after a US court invalidated four of its patents on top-selling multiple sclerosis drug Copaxone. The court ruled in favor of Mylan (NASDAQ:MYL), which wants to market a generic version of the drug. Mylan shared are up approximately 3% in pre-market trading.

Opening Bell: Trumpenomics Roil Markets As Central Banks Eyed

Related Articles

Opening Bell: Trumpenomics Roil Markets As Central Banks Eyed

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email