Market Action

• U.S. GDP expanded at a surprising 2.9% during Q3 according to economic data released Friday. The news led to a selloff in the bond market and a stronger dollar on the stronger likelihood of tighter monetary policy.
• European economies also reported better than forecasted GDP growth including France, Spain, and the U.K Meanwhile Germany’s DAX index hit a 2016 high this week.
• The month of October is set to be the busiest month ever for M&A activity, led by AT&T’s proposed takeover of Time Warner. The total value of proposed deals is $249 Billion.
• Oil slid over 4% this week thanks to a rising dollar and OPEC’s failure to finalize production cuts. The cartel will meet at the end of November to discuss output levels. This week’s failure raises the stakes of next month’s meetings.
• With inflation at its highest level in two years TIPS, inflation protected bonds, are attracting funds. Mutual funds and ETFs that invest in the securities have had their highest inflows since 2011.
• Canada and the EU revived negotiations to agree to a trade deal this week. The deal will eliminate 98% of tariffs and save EU exporters almost €500 million in duties each year.
• S&P 500 firms are on pace to grow earnings by about 1.6% over last year. The figures, while low, are better than expected and would be the first yearly increase since Q1 2015.

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