Stock Market Update

The stock market is on track for a lower opening this morning after strong performances across mega-cap names sent the S&P 500, Nasdaq Composite, and DJIA to record high levels on Friday.

Politico reports that Democratic leaders have requested a meeting with President Trump ahead of the looming government funding deadline, with the president remarking he would "love to meet with them, but I don't think it's going to have any impact."

In geopolitical news, President Trump will address the United Nations assembly tomorrow and meet with Ukrainian President Volodymyr Zelensky, according to The Hill. 

Strengthening expectations for rate cuts at the October and December FOMC meetings drove the major averages to fresh record highs several times last week. Today, the market will hear from New York Fed President John Williams, St. Louis Fed President Alberto Musalem, and Fed Governor Stephen Miran, all voting members of the FOMC.

While there is no economic data of note today, Friday's PCE Price Index for August will be the market's next key inflation reading.

In corporate news:

• The EU wants to prevent large technology firms from sharing financial data, according to The Financial Times.
• Oracle (ORCL 311.26, +2.60, +0.8%) will handle the data of the proposed TikTok deal that will give the U.S. control of the algorithm and 6 out of 7 board seats, according to Politico.
• Tesla (TSLA 428.40, +2.33, +0.6%) received approval to test its robotaxi service in Arizona, according to Reuters.   
• President Trump supports the Union Pacific (UNP 220.36, +0.25, +0.1%) merger with Norfolk Southern (NSC 284.36, +0.65, +0.2%), according to Bloomberg.

Reviewing overnight developments:

Equity indices in the Asia-Pacific region started the week in mixed fashion. Japan's Nikkei: +1.0%, Hong Kong's Hang Seng: -0.8%, China's Shanghai Composite: +0.2%, India's Sensex: -0.6%, South Korea's Kospi: +0.7%, Australia's All Ordinaries: +0.5%.

In news:

• The Nikkei was a standout, rebounding from Friday's post-BOJ losses despite the 10-yr government bond yield hitting its highest level since July 2007.
• China's Shanghai Composite managed a modest gain following the PBOC's expected decision to leave the one-year loan prime rate and five-year loan prime rate unchanged at 3.00% and 3.50%, respectively.
• Separately, there was a stir after the Trump administration announced there will be a $100,000 fee for H-1B visas. Some of the initial angst was tempered with the clarification that the fee is a one-time fee (not per year) and applies to new petitions (not existing H-1B visa holders).

In economic data: 

• Hong Kong's August CPI 0.1% month-over-month (prior 0.6%) and 1.1% yr/yr (expected 1.1%; last 1.0%)

Major European indices have started the week with a mostly defensive posture. STOXX Europe 600: -0.2%, Germany's DAX: -0.7%, U.K.'s FTSE 100: flat, France's CAC 40: -0.3%, Italy's FTSE MIB: -0.3%, Spain's IBEX 35: -1.5%.

In news:

• Major bourses are lower, absorbing some profit-taking activity and guidance warnings from Porsche and Volkswagen.
• Porsche cited the impact of tariffs, weak EV demand, and a slowdown in China as the basis for cutting its sales return outlook and tempering its operating profit expectations.
• Volkswagen expects a EUR5.1 billion total impact.
• Separately, check-in operations at airports in London, Berlin, Brussels, and Dublin were disrupted following a cyberattack on Collins Aerospace.
• ECB member Stoumaras suggested the rate cut cycle is likely over, barring a big drop in growth or inflation. That view has been an underpinning factor for the euro.

There was no economic data of note.