26th Oct - Dip day

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EUROPE

Editorial: This Is No Way to Mend Europe’s Banks – View / BB

They need capital, not coddling.

Matteo Renzi pledges to veto EU budget over refugee crisis – Politico

No industry, no growth – Gefira

Southern Europe’s production start declining after euro adoption

May Said to Want Carney to Stay as He Reflects on BOE Role – BB

Losses Accelerate for Europe Stocks on Earnings Disappointments – BB

UNITED STATES

Steen Jakobsen: US Election: Nothing to lose – TF

US election less about Trump or Clinton policies, more about need for change

El-Erian: Why This Dollar Surge Is Different for the Fed – View / BB

The currency's increase, which hasn't affected stocks, gives more reason to expect a rate hike in December.

OTHER

Globalization Goes Into Reverse – View / BB

Trade, capital flows and immigration have slowed or declined.  Credit the Great Recession, not the protesters.

Exchange rate predictability in the medium term – vox

The IMF invests significant resources in developing models to estimate equilibrium exchange rates. This column assesses the predictive power of one vintage of IMF exchange rate models during 2006–2011. The models performed exceptionally well at predicting exchange rate movements over the medium run, which is particularly remarkable given that the period covered the unanticipated Global Crisis and the assessments were not shared publicly at the time.

99% of actively managed US equity funds underperform – FT

Almost all US, global and EM funds have failed to beat their benchmark since 2006

Rates Strategy: Volatility - Low, yet up for a change – Nordea

Volatility has declined during the past month, yet key events lures in the horizon. In particular certain segments of the EUR vol grid have declined markedly. We review three key events to the vol market ahead of year end and recommend a 3M10Y atmf payer swaption.

REGULARS

Danske Daily – Danske Bank

Eye-Opener – Nordea

Oil falls; GBP gains on Carney comments * Germany on track for more robust growth * Long end squeezed as Austrian 70-year bond hits markets * GBP drops on inflation comments from BoE governor Carney

Morning Markets – TF

European equities are set to open lower on Wednesday in the wake of a weak Asian session and a 2% fall by Apple the world's biggest company after in unveiled a third straight quarter of declining y-o-y revenues.

Euro wrap-up – Daiwa

Daily Market Comment – Marc Chandler

Euro and Yen Extend Recovery

Daily Market Comment – Macro Man

Daily Press Summary – Open Europe

Brussels Playbook – Politico

US Open – ZH

Global Stocks, US Futures Drop On Apple Disappointment, Sliding Crude

Frontrunning – ZH

FX Update – TF

The USD saw a brief new surge yesterday that was quickly turned back as we await next week’s important US data. Elsewhere the AUD surged anew as headline Q3 CPI came in higher than expected.

FINNISH

Aamukatsaus – Nordea

Saksan pitkissä koroissa pohjakosketuksen makua * Suomen työllisyystilanne koheni syyskuussa odotettua enemmän * Saksan Ifo-indeksi nousi korkeimmalle tasolleen yli kahteen vuoteen * Itävallan ultrapitkän velkakirjan kysyntä oli vahvaa