Market Sentiment Sours, Impeachment Proceedings Cloud Trade Outlook, RBZ Holds Rates Steady

The U.S. Futures Are Flat And Mixed In Early Trading

The U.S. indices are indicated to open flat and mixed on Wednesday. The market sentiment is souring in the wake of yesterday’s landmark announcement. The U.S. Speaker of the House Nancy Pelosi launched formal impeachment proceedings against President Donald Trump calling his entire administration into question. The proceedings were precipitated by a whistleblower who claims Trump strong-armed the newly elected Ukranian President. The purpose was to dig up dirt on Joe Biden, the result is a hurdle Trump may find insurmountable. The question now is, what did Trump say? According to the White House transcripts of the call are going to be made public.

In stock news, Phillip Morris and Altria announced an end to merger talks. The talks broke up over JUUL which is now under intense scrutiny for its marketing and sales practices. Shares of both stocks are up sharply in premarket trading but Phillip Morris is in the lead. Shares of Best Buy are also moving higher in early trading. The big-box retailer came out with an aggressive upgrade to guidance but shares only advanced marginally on the news. In other news, KB Homes, Lennar, and Toll Brothers all received upgrades from Raymond James. The sell-side analyst is expecting strong results and indications of improvement within the housing market.

EU Markets Move Lower

The EU markets are moving lower in early trading. The CAC is in the lead at midday with a loss of -1.35% while the DAX and FTSE trail with declines of -1.00% and -0.55%. Trump, impeachment, and the impact on trade talks are the cause of today’s decline. With Trump’s ability to govern impeded by impeachment China is expected to stand firm on trade. With this in mind, it is more and more certain no deal will be reached before the next U.S. presidential elections.

In local news, there are new calls for UK PM Boris Johnson to resign. After Tuesday’s Supreme Court ruling his ability to govern is slipping away. Despite this, Johnson stands by his pledge to take the UK out of the EU on October 31 with or without a deal. In stock news, shares of EDF are down more than -6.0% in early trading. The utility says it misestimated costs for a new project and drastically increased those projections. Shares of UK’s Sainsbury are up 2.6% after it announced the closure of 100 underperforming stores.

Asian Markets Move Lower

Asian markets moved lower on Wednesday too. The threat of impeachment on trade talks has investors on edge. The Shanghai Composite, Hong Kong Hang Seng, and Korean Kospi all fell more than -1.00% on the news. Japan and Australia were also moving lower but declines were much less. In New Zealand, the RBZ held its key rates unchanged but says further cuts may come.