S&P 500 slides to cap worst three-day drop since 2011

US stocks sank, erasing earlier gains and capping the worst three-day loss for  the  S&P  500  Index  since  2011,  as  investors  weighed  prospects  for slowing global  growth and the spread of  Ebola. The S&P 500 slid 1.6%  to 1,874.74. The Dow sank 223.03 points (1.3%) to 16,321.07.

Draghi asset plan seen falling short as QE bets rise

Mario  Draghi’s  latest  strategy  for  the  euro  area  is  failing  to  win  over economists.  More  than  60%  of  the  respondents  in  Bloomberg’s  monthly survey  say  the  ECB  president’s  plan  to  steer  its  balance  sheet  toward early-2012  levels  is  set  to  fall  short  and  a  growing  number  predict  he’ll resort to large-scale government-bond buying.  Draghi again signaled that he  intends  to  expand  the  ECB’s  balance  sheet  by  as  much  as  €1trn (US$1.3trn) to stave off deflation in the euro area.

France’s budget attacked as Finance Ministers round on plan

Euro-area  governments  warned  France  that  it  cannot  expect  special treatment  if  its  budget  for  next  year  falls  outside  of  EU  spending  rules. France is under pressure as it predicts its budget deficit to widen this year for the first time in half a decade and doesn’t see the shortfall shrinking to the EU limit of 3% of gross domestic product before 2017.

China’s exports buoy growth as IPhone inflates imports

China’s  slowing  economy  received  a  shot  in  the  arm  from  faster  export growth in September, with external demand spilling over to boost imports for  processing  and  re-shipment  of  goods  such  as  the  iPhone  6.  Exports increased 15.3% from a year earlier, beating the 12% median estimate in a Bloomberg survey of analysts. Imports rose 7%,  against projections for a 2% decline, leaving a trade surplus of about US$31bn.

Debelle says Aussie overvalued, bond sell-off may be violent

Australia’s currency remains overvalued on most measures while any selloff in global fixed-income markets could be “relatively violent,” central bank Assistant Governor Guy Debelle said.  “The Australian dollar is still higher than  most  conventional  estimates  of  fundamentals  would  indicate, notwithstanding  its  recent  decline,”  Debelle  said.  “The  exchange  rate  is thus offering less assistance than would normally be expected in achieving balanced growth in the Australian economy. A lower exchange rate would be helpful in achieving that objective.”

India’s CPI slows more than estimated in boost for Rajan

India’s  retail  inflation  slowed  more  than  economists  had  estimated  after central bank Governor Raghuram Rajan held one of Asia’s highest interest rates. Consumer prices rose 6.46%  in September from a year earlier. The median of 42 estimates in a Bloomberg survey had been for a 7.11% gain. While the RBI seems set to achieve its 8%  CPI target for January, its goal of  6%  a  year  later  is  in  doubt,  Rajan  said.  Lower  inflation  or  a  narrower budget  deficit  may  lead  to  sustainable  growth  and  boost  India’s  credit rating after S&P’s last month raised its outlook to stable from negative.

Brent near 4-year low as Iraq follows Saudi price cuts

Brent  crude  dropped  to  the  lowest  level  in  almost  four  years  after  Iraq followed Saudi Arabia and Iran in cutting prices.  WTI’s discount to Brent narrowed.  Brent  for  November  settlement  slid  $1.32  (1.5%)  to  end  at $88.89 a barrel.

Source: Bloomberg