After the Storm

Economic Data

- (PT) Portugal Aug Current Account Balance: €0.6B v €0.5B prior

- (IL) Israel Q2 Final GDP Annualized: 1.9% v 1.5% prelim

- (BR) Brazil Oct IGP-M Inflation (2nd Preview): 0.1% v 0.0%e

- (CA) Canada Aug Wholesale Trade Sales M/M: +0.2% v -0.3%e

- (BE) Belgium Oct Consumer Confidence Index: -12 v -11 prior

The S&P500 and Nasdaq are seeing modest gains this morning after a wild week, while the DJIA is being weight down by the 8% slide in IBM shares. As of writing, the DJIA is down 0.28%, the S&P500 is up 0.29% and the Nasdaq is up 0.65%.

All has been quiet on the Ebola front for the last two days, with no new cases reported in the US and dozens of people released from the watch list in Dallas. Meanwhile the Pentagon is forming a 30-person "quick-strike team" equipped to provide direct treatment to Ebola patients inside the US. Most of the hot Ebola stocks that had seen huge gains over recent weeks are down sharply this morning. LAKE is off 18% and TKMR is down 5.4%.

Business software giants SAP and IBM both cut FY14 guidance this morning, weighing on indices in Europe and the US. SAP's results were more or less in line in the quarter, and the adjustement in outlook had more to do with the shift toward cloud computing, where licenses cost less money up front but provide more revenue over time. Meanwhile IBM turned in a rotten third quarter report, with profits and revenue well behind expectations. The lower guidance was chalked up to a change in accounting for earnings. IBM CEO Rometty warned that IBM "saw a marked slowdown in September in client buying behavior, and our results also point to the unprecedented pace of change in our industry." IBM also said it reached a deal to divest its microelectronics business to Globalfoundries, in a deal requiring it to pay $1.5B over three years for Globalfoundries to take the unit off its hands.

Shares of ShoreTel are up nearly 20% after Mitel submitted an $8.10/shr offer to acquire the company in a deal valued at $540 million. ShoreTel's board rejected the proposal and refused to engage, suggesting Mitel may try later with a higher offer. In other deal news, Valeant's CFO said his side would be willing to raise its offer for Allergan, with a higher stock price and a bit more cash likely to push the offer over $200/shr.

Looking Ahead

- 17:00 (CO) Colombia Aug Trade Balance: -$0.5Be v -$0.8B prior; Total Imports: $5.6Be v $6.1B prior

- 20:30 (AU) RBA Minutes of Oct Meeting

- 22:00 (CN) China Sept YTD Fixed Urban Assets: 16.3%e v 16.5% prior

- 22:00 (CN) China Sept Retail Sales Y/Y: 11.7%e v 11.9% prior; Retail Sales YTD Y/Y: 12.1%e v 12.1% prior

- 22:00 (CN) China Sept Industrial Production Y/Y: 7.5%e v 6.9% prior; Industrial Production YTD Y/Y: 8.4%e v 8.5% prior

- 22:00 (CN) China Q3 GDP Q/Q: 1.8%e v 2.0% prior; Y/Y: 7.2%e v 7.5% prior; GDP YTD Y/Y: 7.4%e v 7.4% prior