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 Good morning ! Here's what you need to know. - Markets in Asia were mostly higher, led by Australia's S&P/ASX200 at 0.73%. European markets were higher across the board with France's CAC40 up most at 0.44%. U.S. futures were pointing higher.
- Mainstream Republicans are turning on the Tea Party, the AP reports, pinning the blame of the government's 16-day shutdown and coincident debt ceiling crisis on the radical conservative movement. " 'I don't want to go down this road again,' New Hampshire Senator Kelly Ayotte said in an interview, noting that she disagreed with congressional conservatives' tactics during the budget fight. 'What we take from this experience is that there are obviously common-sense problem solvers, and that's where the party needs to be.' " And Goldman's Alec Phillips says in a new note that even if negotiations drag on over the resolving the debt ceiling in the next few months, the GOP's self-inflicted wounds means centrists should be able to win the day. "...at this point we do not expect the next debt limit increase to be quite as disruptive as the one just debated. The recent showdown had negative political consequences for Republicans, and after two 'clean' debt limit increases they may find it difficult to argue for policy concessions on the next extension."
- Chinese GDP grew 7.8%, meeting expectations and snapping a two-quarter-long streak of slowing growth. But the National Bureau of Statistics warned the economy faced pressure from a "complicated, volatile and severe" external environment, as well as "accumulated structural problems in the economy," AFP reported.And Nomura's Zhiwei Zhang believes this is a top, writing: "We have argued that China‟s recovery is fundamentally unhealthy , as it has been mainly driven by heavy industry and stands in contrast to the principles recently expounded by both President Xi Jinping and Premier Li Keqiang – that a lower rate of GDP growth can be tolerated to ensure a better quality of growth in the future. We expect the government to cut its growth target for 2014 to 7% in December in an effort to contain financial risks such as local government debt risk."
- In a new note, Morgan Stanley says Korea can be a new safe haven for investors. They cite four factors: regulations that were put in place after 2008 to "foster stability;" a comparative lack of overinvestment, no apparent asset bubbles, and prudent fiscal and monetary policies. They write, "Korea has seen the largest amount of bond investment inflow in AXJ since 2008, but we are not worried about risk of massive unwinding, because foreign ownership is still low and we believe the holders are mainly long-term investors, not speculators."
- Morgan Stanley reports earnings at 7:15 am. Analysts expect $0.41/share (up from $0.28/share at this time last year) and revenue of $7.5 billion (up from $5.3 billion in Q3 2012). BI's Linette Lopez says it's been a rough quarter for bank earnings: "With all banks but Morgan reporting, only one — Bank of America — didn't miss expectations. Otherwise, it's been a pretty putrid earnings season on Wall Street. That is mostly attributable to two weak businesses — mortgage origination and fixed-income trading. Even the mighty Goldman Sachs saw its fixed income trading revenue take a 44% hit year over year." GE reported earnings earlier this morning that beat forecasts by $0.01, but Q3 revenue of $3.2 billion was off $300 million from last year.
- The worst seems to be over for the Rupee, as the currency hit a two-month high against the dollar, to R61.24, after seeing steep declines during the summer. India's Sensex stock market hit just shy of a three-year high.
- Chipotle reported Q3 revenues of $826.9 million, above expectations, with same-store sales up 6.2%, also thoroughly surpassing forecasts. Shares rallied about 5% after hours.
- Google reported earnings of $10.74/share and revenue of $14.98 billion yesterday, both beating forecasts, and the stock surged more than 7% after hours trading, breaching $900. But Larry Page announced his vocal cord problem persists and that he would no longer speak on earnings calls.
- The Conference Board reports its latest Leading Indicators Index reading at 10 am. Analysts expect a 0.6% gain versus 0.7% prior.
- The Wall Street Journal is reporting SAC Capital is nearing a settlement with regulators over criminal insider trading charges that would exceed $1 billion, the largest-ever. Firm founder and CEO Steve Cohen, who has not been accused of wrongdoing, is said to still be negotiating whether he would pay any kind of penalty.
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