MARKET RECAP at 4 pm ET

Wall Street and Treasury yields Coming Up slipped, as hopes of a fiscal stimulus being approved before the presidential Morgan Stanley reports third quarter election in November dimmed. The earnings, with its trading business dollar fell, while gold gained. Oil prices expected to have benefited from rose, even as concerns over recovery heightened market activity. The bank in fuel demand due to rise in global may also update on its recent coronavirus cases remained. acquisition of E*Trade and planned purchase of Eaton Vance in deals worth a combined $20 billion.

REUTERS/Shannon Stapleton STOCKS Close Chng %Chng Yr-high Yr-low On the economic front, a report from DJIA 28514.63 -110.95 -0.58 29568.57 18213.65 the U.S. Labor Department will show import prices likely increased 0.3% in expected to report fourth-quarter Nasdaq 11768.73 -95.17 -0.80 12074.07 6631.42 September, after rising 0.9% in August, results before markets open. Investor S&P 500 3488.66 -23.27 -0.66 3588.11 2191.86 while export prices are likely to have focus will be on impact of the pandemic Toronto 16455.40 -55.43 -0.34 17970.51 11172.73 increased 0.4% in September, and appointment of a new CEO on the FTSE 5935.06 -34.65 -0.58 7689.67 4898.79 Eurofirst 1433.87 -2.29 -0.16 1691.19 1051.38 following a 0.5% increase in the drugstore chain's business levels, Nikkei 23626.73 24.95 0.11 24115.95 16358.19 previous month. The department will especially in the UK. Hang Seng 24667.09 17.41 0.07 29174.92 21139.26 also release its initial jobless claims data for the week ended October 10, Bank of TREASURIES Yield Price which are likely to have fallen to President is 10-year 0.7223 2 /32 825,000, after reaching 840,000 in the scheduled to give a presentation on 2-year 0.1410 0 /32 week before. Continued jobless "Equity, the Economy and Benefits 5-year 0.3040 0 /32 claims for the week ended October 3 Cliffs" and participate in a panel before 30-year 1.5021 9 /32 are expected to have fallen to 10.700 a virtual "Reframing Benefits Cliffs: million after reaching 10.976 million in Solutions for an Inclusive Recovery" FOREX Last % Chng the week ended September 26. summit. Additionally, Federal Reserve

Euro/Dollar 1.1748 0.03 Meanwhile, the Philadelphia Fed's Bank of Dallas President Robert Dollar/Yen 105.12 -0.34 business index is likely to show a Kaplan will participate in a moderated Sterling/Dollar 1.3026 0.73 reading of 14.0 in October, after a question-and-answer session before a Dollar/CAD 1.3145 0.06 reading of 15.0 in September. virtual U.S. India Chamber of TR/HKEX RMB 94.81 0.19 Commerce Annual Small Business Walgreens Boots Alliance Inc is Forum. In another event, Federal COMMODITIES ($) Price Chng % chng

Front Month Crude /barrel 41.04 0.84 2.09 Spot gold (NY/oz) 1901.31 10.49 0.55 Copper U.S. (front month/lb) 0.0305 0.0001 0.16 KEY ECONOMIC EVENTS CRB Index Total Return 160.96 1.20 0.75 Events ET Poll Prior

S&P 500 Price $ Chng % Chng NY Fed Manufacturing for Oct 0830 15.00 17.00 GAINERS Import prices mm for Sep 0830 0.3% 0.9% Concho Resources Inc 48.66 4.52 10.24 Export prices mm for Sep 0830 0.4% 0.5% Newell Brands Inc 18.27 0.58 3.28 HollyFrontier Corp 20.50 0.65 3.27 Import prices yy for Sep 0830 -- -1.4% LOSERS Initial jobless claims 0830 825,000 840,000 Wells Fargo & Co 23.25 -1.50 -6.04 Jobless claims 4-week average 0830 -- 857,000 Bank of America Corp 23.63 -1.32 -5.29 Continued jobless claims 0830 10.700 mln 10.976 mln Illumina Inc 330.12 -15.02 -4.35

Reserve Vice Chair for Supervision an Economic Club of New York sales are also expected to fall 9.5% in will speak on webinar. Also, August, after falling 12.4% in July. "Response to the COVID Threat" of Minneapolis President Neel Peru's GDP data for August is before a virtual Institute of International Kashkari will speak to NYU Stern scheduled for release. It contracted Finance Annual Meeting. Also, Federal Center for Global Economy and 11.71% in July. Chile's is Reserve Bank of St. Louis President Business. expected to hold its benchmark James Bullard will present an interest rate steady at 0.5%. academic paper and discuss "Monetary The Brazilian central bank will release Policy and Heterogeneity" before a its IBC-Br Economic Activity index, LIVECHAT – REUTERS GLOBAL virtual Federal Reserve Board of likely showing an increase of 1.60% in MARKETS FORUM Governors Conference on Monetary August, after an increase of 2.15% in Reuters correspondents examine the Policy and Heterogeneity. Separately, the previous month. Colombia will state of play in European govvies. Federal Reserve Bank of Richmond release its industrial output data, (0630 ET/1030 GMT) To join the President Thomas Barkin is likely showing output falling by 7.8% in conversation, click here scheduled to speak on "What's Ahead? August, following a decrease of 8.5% in Learning from the CFO Survey" before the previous month. Colombia’s retail

KEY RESULTS

Company Name* Quarter ET Smart Estimates EPS Estimates** Year Ago Rev Estimates (mln)

Charles Schwab Q3 BMO $0.48 $0.46 $0.74 $2,535.70 Intuitive Surgical Q3 AMC $2.12 $2.07 $3.43 $970.97 Morgan Stanley Q3 BMO $1.29 $1.28 $1.27 $10,636.93 Truist Financial Q3 BMO $0.88 $0.89 $0.95 $5,440.47 Walgreens Boots Alliance Q4 07:00 $0.96 $0.96 $1.43 $34,371.57

*Includes companies on S&P 500 index. **Estimates may be updated or revised; release times based on company guidance or past practice.

I/B/E/S EPS and revenue estimates, and StarMine Smart Estimates, provided by Refinitiv.

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Market Monitor

Wall Street finished weaker, led lower by Amazon and Microsoft, as investors lost hope that a U.S. fiscal stimulus would be approved before the presidential election in November. “Optimism took hold like a rocket last week and now it’s coming back down to earth a little bit,” said Mike Zigmont, head of trading and research at Harvest Volatility Management in New York. "I think a stimulus as a large macro event is already baked into stock prices. It's just a question of when the details emerge and when the stimulus goes into effect." The Dow Jones Industrial Average fell 0.58% to 28,514.63, the S&P 500 lost 0.66% to 3,488.67 and the Nasdaq Composite dropped 0.80% to 11,768.73.

Treasury yields drifted mostly lower A file photo of the Charging Bull statue, also known as the Wall St. Bull, in the financial district as Treasury Secretary Steve Mnuchin during the coronavirus disease (COVID-19) pandemic in the Manhattan borough of New York City, New York, September 9. REUTERS/Carlo Allegri said a deal to combat the economic fallout from the coronavirus pandemic appeared unlikely before the Nov. 3 presidential election. Tom Simons, a "Right now the dollar is simply going barrel, up 2.10%. U.S. crude rose money market economist at Jefferies in back and forth on stimulus news, and it 2.14% to $41.06 a barrel. New York, said aside from virus is not going very far," said Joseph Gold gained, rebounding from a sharp vaccine news, "stimulus is probably the Trevisani, senior analyst at most important news item that the FXStreet.com. The dollar index fell to decline in the previous session, market is trading on. But at this point, 93.35, down 0.19%. The euro edged boosted by a weaker dollar and it's hard to expect that anything is up 0.05% against the dollar to uncertainties surrounding the U.S. election and global economic recovery going to get done this year on that," he $1.1750. boosted the safe haven metal's allure. said. The benchmark 10-year notes were up 2/32 to yield 0.72% and the 30 Oil prices strengthened, even as "The dollar index is down on the day, -year bonds rose 9/32 to yield 1.50%. concerns loomed that recovery in fuel yields are lower which is supporting demand will be stalled by soaring gold and we're also seeing some technical buying probably because The dollar index retreated, a day after global coronavirus cases. "Between the notching its biggest daily percentage dollar, the EIA and the warning from yesterday's correction was a little gain in three weeks, and the euro hit the IEA that may impact future OPEC overdone," said Bart Melek, head of its lowest level in a week as global policy, the tone has turned bullish commodity strategies at TD Securities. Spot gold rose 0.55% to $1,901.16 per equity markets remained cautious on here," said Bob Yawger, director of ounce. U.S. gold futures were 0.68% waning hopes a COVID-19 vaccine or energy futures at Mizuho in New York. U.S. fiscal stimulus was on the horizon. Brent crude futures were at $43.34 a higher at $1,907.40 an ounce.

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Top News

Goldman's trading business returns High costs haunt Wells Fargo experimental coronavirus antibody to former glory during pandemic results years after scandal therapy remain on track after a stress Wells Fargo's profit plunged 57% in the government-run study testing the Goldman Sachs posted its best third quarter, missing Wall Street's treatment in hospitalized COVID-19 quarterly performance in a decade by expectations as persistent costs tied to patients was paused due to safety some measures, as trading moved its years-old sales practices scandal concerns. The National Institutes of back into the limelight and its lack of a continued to haunt the bank. The bank Health (NIH), which is collaborating big consumer business switched from a which has been in regulators' penalty with Lilly on the trial, said the advisory curse to a blessing. The Wall Street box since 2016, spent $961 million on board paused the trial after seeing a bank posted a quarterly return-on- customer remediation accruals in the "difference in clinical status" between equity of 17.5%, its highest since 2010. quarter, indicating that the bank was patients on Lilly's drug on those who Goldman also boasted record earnings still feeling the burn from its sales received a placebo, without providing per share, beating analyst expectations practice scandal has already cost it further detail. Lilly said the paused trial by a wide margin. Its performance was billions. Net-interest income at the is distinct from others it is conducting driven in large part by a 29% jump in fourth-largest U.S. bank was $9.4 because it focuses on hospitalized trading revenue, as clients responded billion, down $512 million from the patients who are more severely ill and to news about the coronavirus second quarter, as its loan book shrank being treated with other drugs as well, pandemic by shifting their portfolios. 2%. Total revenue fell 14%. Wells including Gilead’s antiviral remdesivir. The bank's overall profit nearly doubled Fargo posted net income applicable to $3.5 billion from $1.8 billion a year ago. common stock of $1.72 billion, or 42 EU antitrust regulators may narrow Earnings per share were a record cents per share, for the quarter ended Amazon investigation – sources $9.68, up from $4.79 a year earlier. Sept. 30, compared with $4.04 billion, EU antitrust regulators may narrow the Analysts had expected a profit of $5.57 or 92 cents a year earlier. Analysts scope of their year-long investigation per share, on average, according to the expected a profit of 45 cents, according into Amazon to speed up the case IBES estimate from Refinitiv. to Refinitiv data. Shares of the against the U.S. online retail giant, company ended 6.04% lower at people familiar with the matter told BofA says better equipped to handle $23.25. Reuters. Splitting up the Amazon case recession as loan loss provisions could address complaints by rivals that shrink Eli Lilly says other COVID-19 antitrust enforcers take too long to Bank of America executives joined the antibody drug trials ongoing after address harm done to them through chorus of U.S. bank officials predicting study halted for safety concern anti-competitive practices and that an economic recovery would improve Eli Lilly said other trials of its rulings fail to keep pace with evolving business in the quarters ahead, after lower interest rates fueled a miss on third-quarter revenue. Bank of America set side $1.4 billion to meet future losses in its commercial loan portfolio in the quarter, far less than the $5.1 billion it provided for during the June quarter. Net interest income at the bank, sank 17%, showing the effects of the U.S. Federal Reserve's moves to slash interest rates to near-zero and promise to keep them there to help spur growth. The company posted adjusted revenue of $20.45 billion, compared with analysts' average estimate of $20.81 billion, according to IBES data from Refinitiv. Net income applicable to common shareholders fell 15.8% to $4.44 billion, or 51 cents per share, in the quarter ended Sept. 30, A file photo of the Bank of America logo in the Manhattan borough of New York City, New York, but beat estimates of 49 cents. January 30, 2019. REUTERS/Carlo Allegri

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markets. The European Commission track a Justice Department appeal of a with the matter said. The EU decision started an investigation into Amazon in ruling blocking the government from comes amid a legal battle between July 2019, focusing on whether its dual banning new TikTok downloads from LVMH and Tiffany, with the latter suing role as a marketplace for merchants U.S. app stores. U.S. District Judge the Louis Vuitton owner in a Delaware and also as a competitor selling the Carl Nichols in Washington issued a court, alleging that the French same products might give it an unfair preliminary injunction on Sept. 27 that company has deliberately been stalling advantage. The investigation is also barred the U.S. Commerce Department the completion of the deal. The looking at the role of data in the from ordering Apple and Google app European Commission, which is selection of Amazon's "Buy Box" stores to remove the Chinese-owned scheduled to decide on the deal by winners which appear on the right of short video-sharing app for download Oct. 26, declined to comment. LVMH product pages saying "Buy now" or by new users. A U.S. appeals court in and Tiffany did not immediately "Add to basket" and drive about 80% of Washington said all briefs are due by respond to a request for comment. The sales. The European Commission Nov. 12 with oral arguments to follow. two companies had several overlaps in declined to comment. The government's opening brief is due some areas but these are not serious on Friday. enough to trigger competition UnitedHealth approaches 2021 concerns, the people said. cautiously on COVID-19 uncertainty, Microsoft in deal with Equinor for shares fall Norway CO2 storage project YouTube bans coronavirus vaccine UnitedHealth took a conservative Microsoft has signed a memorandum misinformation stance toward its expectations for of understanding with Norway's YouTube said it would remove videos 2021, citing uncertainties related to the Equinor to explore the use of a carbon from YouTube containing COVID-19 pandemic, but raised its dioxide storage facility as the tech firm misinformation about COVID-19 profit forecast for this year after third- seeks to erase its carbon footprint, it vaccines, expanding its current rules quarter earnings beat estimates. The said. Microsoft will become a against falsehoods and conspiracy company said it expects a strong technology partner in the Northern theories about the pandemic. The performance from its Medicare Lights project, part of a wider video platform said it would now ban Advantage plans for the disabled and Norwegian effort to develop carbon any content with claims about COVID- people aged 65 and older, and backed capture technology at industrial sites 19 vaccines that contradict consensus its long-term view for 13% to 16% and store CO2 under the seabed, from local health authorities or the earnings growth. For the quarter, the Equinor said at a news conference in World Health Organization. YouTube company reported a medical loss ratio Oslo. "Our goal is not only to contribute said in an email that this would include (MLR) of 81.9%, lower than last year's our technology and know-how, but removing claims that the vaccine will 82.4% and analysts' estimate of explore how new solutions like the kill people or cause infertility, or that 83.55%, according to Refinitiv data. It Northern Lights project can help us microchips will be implanted in people reported adjusted third-quarter meet our own carbon negative goals by who receive the vaccine. In its email, earnings of $3.51 per share, topping 2030," Microsoft President Brad Smith YouTube said it had removed over analysts' estimates of $3.09. The said. The Norwegian government is 200,000 videos related to dangerous or company raised its annual 2020 expected to cover about 80% of the misleading COVID-19 information since adjusted profit forecast to $16.50 to $751 million cost of the CO2 deposit's early February. Meanwhile, Twitter $16.75 per share from a previous first stage, which would be able to store suffered from cybersecurity shortfalls range of $16.25 to $16.55 per share. 1.5 million CO2 tonnes per year, that enabled a "simple" hack attributed Shares of the company ended 2.85% Equinor has said. to a Florida teenager to take over the lower at $321.99. accounts of several of the world's most LVMH to win EU antitrust approval famous people in July, according to a U.S. court agrees to expedite for Tiffany deal – sources report released. To read more, click government TikTok app store ban French luxury goods group LVMH is here appeal set to gain EU antitrust approval for its A U.S. appeals court agreed to fast- acquisition of Tiffany, people familiar

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A message reminding about social distancing appears on the screen before a drive-in premiere for the film "The Trial of the Chicago 7" at Rose Bowl in Pasadena, California, October 13. REUTERS/Mario Anzuoni

Insight and Analysis

After two lost decades, U.S.'s COLUMN- How the market learned to U.S. equities, 10-year yields, dollar- weakest local economies may face stop worrying and love the blue yen to fall if election result is worse from pandemic wave: Mike Dolan delayed A decade-long economic expansion did Just about the only market consensus U.S. equities, 10-year yields and the little to narrow the gaps between the all year on next month's U.S. election dollar-yen rate are expected fall if the U.S.'s prosperous and ailing areas, was that it would be volatile around the election result is delayed much longer with thousands of "distressed" zip vote - but even that's turning upside than a couple of weeks beyond Nov. 3 codes shedding jobs and businesses in down three weeks before polling. A or is contested in the Supreme Court, a a trend that laid the groundwork for the narrow and disputed election result has fund manager and a strategist said. developing "K" shaped recovery from been one of the main investor fears for U.S. equity markets could fall 5%-10%, the coronavirus pandemic. An analysis months. Bank of America's October "depending upon how bad the from the Economic Innovation Group global fund manager survey still had headlines get," Binay Chandgothia, showed that from 2000 through 2018, 60% of its respondents expecting the portfolio manager at Principal Global already prosperous areas pulled further result to be contested - and three Investors, told the Reuters Global ahead, capturing disproportionate quarters said it was the outcome likely Markets Forum. shares of the jobs created and the new to cause most market disruption. businesses that were formed.

6

CANADA

COMING UP Market Monitor Bank of Canada Deputy Governor Canada's main stock index fell. REUTERS/Mark Blinch Timothy Lane will appear on a panel at the Central Banks Payments The Toronto Stock Exchange's S&P/ Conference via videoconference. TSX composite index was down 0.34%, at 16,455.40. TSE's S&P/TSX composite Price C$ chng % chng

The U.S. dollar was 0.06% up against GAINERS Fortuna Silver Mines Inc 9.46 0.46 5.11 the Canadian dollar at C$1.3145. Eldorado Gold Corp 18.03 0.85 4.95 Seabridge Gold Inc 26.25 1.20 4.79 Teck Resources Ltd 18.21 0.70 4.00 Methanex Corp 36.13 1.36 3.91 LOSERS Trillium Therapeutics Inc 19.70 -1.10 -5.29 Aurora Cannabis Inc 5.96 -0.31 -4.94 MEG Energy Corp 2.64 -0.13 -4.69 Fairfax Financial Holdings Ltd 387.79 -15.29 -3.79 Aphria Inc 7.71 -0.29 -3.63

Top News

FOCUS-Canada's oil patch seeks Pandemic accelerates need to Restaurant Brands expects Burger government green aid to produce consider digital currency -Bank of King Q3 sales to drop, Popeyes to cleaner crude Canada shine Canada's struggling oil patch is The COVID-19 pandemic is Restaurant Brands International seeking government aid to clean up its accelerating the public's use of online forecast Burger King's quarterly impact on the environment after the services and that means the Bank of comparable sales to decline due to the industry cut spending on green Canada must move more quickly to COVID-19 pandemic, even though initiatives to weather the COVID-19 research how a central bank digital demand for its chicken sandwiches downturn. Canada, the world's fourth- product would work, a top official said. was likely to boost growth for Popeyes. largest oil producer, pumps out the The Bank of Canada has been The company reported preliminary highest emissions per barrel among exploring and building capacity for comparable sales drop of 7% for the major oil nations, according to Rystad products like a central bank digital three months ended Sept. 30 at its Energy. Most Canadian crude comes currency (CBDC), but there has been flagship Burger King operation globally. from hydrocarbon-soaked sands in the no specific time frame for launching However, that was an improvement province of Alberta and extracting it one, Deputy Governor Tim Lane said from a 13.4% fall it reported in the comes at a high environmental cost. during a panel discussion on the future previous quarter when most of its International oil majors, banks and of money. "The main point, I think, is restaurants were closed for dine-in due investment funds have shunned this is all looking a lot more urgent to lockdowns. At Tim Hortons, its financing oil sands projects as dirty and because of the speed with which breakfast chain that has struggled this expensive. European oil majors, under technology is evolving," said Lane. A year as offices and colleges shift governmental pressure, have digital currency would act like cash and online, comparable sales are expected embarked on a difficult transformation streamline transactions by avoiding a to fall 12.5%. Popeyes is expected to toward more renewables like wind and need to use a payment card for online lift sales for another quarter, with sales solar. purchases. expected to rise 17.4%.

7

WEALTH NEWS

SOFT INFLATION U.S. producer prices accelerate, but overall inflation trending softer U.S. producer prices increased more than expected in September amid a surge in the cost of hotel and motel accommodation, leading to the first year-on- year gain since March. The producer price index for final demand rose 0.4% last month after advancing 0.3% in August. In the 12 months through September, the PPI rebounded 0.4% after falling 0.2% in August. Excluding the volatile food, energy and trade services components, producer prices rose 0.4% in September. The so-called core PPI had increased by 0.3% for three straight months. In the 12 months through September, the core PPI climbed 0.7%. The core PPI gain 0.3% on a year- on-year basis in August. "The prices of some producer prices are climbing, but factories are not back to normal yet," said Chris Rupkey, chief economist at MUFG in New York.

GLOBAL ECONOMY G20 vows to do 'whatever it takes' to support global economy Financial leaders from the Group of 20 major economies underscored the urgent need to bring the spread of the coronavirus pandemic under control, and vowed to "do whatever it takes" to support the global economy and financial stability.

DISNEY LAYOFFS Senator Warren slams Disney for layoffs, executives' salaries U.S. Senator Elizabeth Warren slammed Disney's move to lay off 28,000 workers while making shareholder payouts in the years leading up to the COVID-19 pandemic, demanding more information from company executives on the measures.

DEEP HOLE Fed's Clarida says U.S. data 'surprisingly strong,' but deep hole remains U.S. economic data since May has been "surprisingly strong," though it will still take perhaps another year for output to claw back to its pre-pandemic peak, Federal Reserve Vice Chair said.

OIL DEMAND IEA says oil producers may struggle to gauge demand amid second wave Global oil stocks which rose during the height of the pandemic are being steadily reduced, the International Energy Agency (IEA) said, but a second wave is slowing demand and will complicate efforts by producers to balance the market.

NAME CHANGE The We Company reverts to WeWork name to emphasize office-sharing roots The We Company, parent of money-losing shared office provider WeWork, which last year yanked plans to go public after harsh criticism over its business model and erratic management, is dropping the "we" moniker to revert to its better-known name, according to an internal memo seen by Reuters.

BID EXPIRY Traton says revised takeover bid for Navistar expires on Friday Volkswagen's truck unit Traton said its revised takeover bid of $43 per share for U.S. truck maker Navistar will expire on Oct. 16, if not accepted by then.

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Anti-government demonstrators march during a Thai anti-government mass protest, on the 47th anniversary of the 1973 student uprising, in Bangkok, Thailand, October 14. REUTERS/Athit Perawongmetha

The Day Ahead - North America is compiled by Priyanka Das and Haneyl Jacob in Bengaluru.

For questions or comments about this report, email us at: [email protected].

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