Refinitiv Newscasts - U.S. Day Ahead: OPEC set to clinch output deal; Mnuchin, Powell to testify
30/11/2020 21:00
Click the following link to watch video: https://share.newscasts.refinitiv.com/link?entryId=1_jwaqedep&referenceId=1_jwaqedep&pageId=RefinitivNewscasts Source: Reuters Insider Description: OPEC members will likely extend their output cuts for three months from January, in an agreement reached before a formal decision is due on Tuesday. While U.S. Treasury Secretary Steven Mnuchin and Federal Reserve Chairman Jerome Powell will testify before a U.S. Senate Committee, where Mnuchin may come under fire for ending some of the Fed's pandemic-related lending programs. Short Link: https://refini.tv/36lcThs Video Transcript: Good afternoon. I'm Elena Casas, welcome to your wrap up of today's top news and an insight into what's coming up on Tuesday. OPEC members have agreed to extend oil output cuts for three months from January - if their allies in the wider OPEC plus group support the move. Members reached a broad consensus on the move and will hold wider talks on Tuesday. The existing cuts are two million barrels per day - that's 8% of global output. Keeping the current cuts in place would still leave inventories above their five-year average. Taking a look at the price of Brent, it has slipped back today below $48 a barrel. Moderna applied for US and European emergency authorization for its coronavirus vaccine on Monday - after full trial results showed it was 94.1% effective and 100% able to prevent severe disease. Moderna's product is on track to be the second vaccine approved after Pfizer and BioNTech's inoculation. The FDA will review that data on December 10th and Moderna's a week later. US Health Secretary Alex Azar said on Monday vaccinations could start before Christmas. Let's take a look at how markets stand as we head into the close then. They have slipped back a bit on Monday but remain on track for the best month on record - a rotation into sectors that will provide better returns once a vaccine is with us has pushed up the main indices about 10% over the month. Stock prices are about 23 times expected earnings for the next four quarters - earlier I asked Amy Kong of Barrett Asset Management if that's really justified. The markets will return to refocus on earnings. And it will be, again, an earnings-driven market as we look to the next couple of quarters. I think in general though, with interest rates where they are, and also inflation where they are- inflation expectations, excuse me, where they are, that markets are willing to sit at a higher than normal price-to-earnings ratio. But ultimately, though, earnings do need to catch up and that's going to be key for the next couple of quarters. Federal Reserve Chair Jerome Powell and Treasury Secretary Steven Mnuchin are to testify on Tuesday before the Senate on how the stimulus money authorized in the spring was used as prospects of a new stimulus before Joe Biden takes office in January look weak. Mnuchin wrote to Republican senators on Friday saying they should trust in the ability of the Fed and the new Treasury team under his expected successor Janet Yellen to manage coronavirus relief programs - after he came under fire for deciding to let some lending programs expire at the end of the year. That will limit Yellen's ability to backstop credit markets. On the economic data front, Tuesday brings manufacturing PMI and construction spending. The numbers are expected to show American factories are well on their way to recovery with economists polled by Reuters predicting a PMI of 58. That's after the index hit 59.3 in March, its highest level since November 2018. And finally, if you want a piece of some of the biggest pop stars in the world, Korean boy band BTS are auctioning some of their costumes for the first time. The outfits they wore in the video for 'Dynamite' - their first ever English language single which debuted at the top of the Billboard hot 100 in the summer - are going under the hammer in LA. They're expected to raise at least $40,000 dollars, but the devotion of their fanbase may send the price much higher than that. The video was the first to hit 10 million YouTube views and did so within 20 minutes of its release. That's it for now. I'm Elena Casas and this is Reuters