Investing.com - Here are the top five things you need to know in financial markets on Thursday, October 13:
1. Gloomy China trade data spooks investors
China's September exports plunged, while imports unexpectedly shrank after picking up in August, suggesting signs of steadying in the world's second-largest economy may be short-lived.
Exports tumbled 10.0% from a year earlier, far worse than forecasts for a decline of 3.0%, while imports dropped 1.9%, compared to expectations for a gain of 1.0%.
That left China with a trade surplus of $41.99 billion for the month, the lowest in six months, the General Administration of Customs said on Thursday.
The surprisingly weak figures pointed to sluggish demand both at home and aboard, and deepened worries over the latest depreciation in the yuan, which hit a fresh six-year low against the U.S. dollar on Thursday.
2. Fed rate hike bets boost U.S. dollar to 7-month highs
The dollar rose to fresh seven-month highs against the other major currencies on Thursday, after minutes from the Federal Reserve's September meeting reaffirmed expectations of a December interest rate hike.
The U.S. dollar index, which measures the greenback's value against a basket of six major currencies, rose to 98.12 at one point, the most since March 10. It was last at 97.85, down 0.1% in early morning hours in New York.
According to the minutes, several voting members of the policy committee judged a rate hike would be warranted "relatively soon" if the U.S. economy continued to strengthen.
Markets are currently pricing in around a 65% chance of a rate hike at December's meeting, according to Investing.com's Fed Rate Monitor Tool.
Against the yen, the dollar touched a session high of 104.63, which was the strongest level since July 29, before turning lower to 103.92.
The euro, meanwhile, inched down to an 11-week low of 1.0958 against the greenback, before recovering to 1.1017.
Elsewhere, the British pound hovered close to its weakest level in more than three decades, with GBP/USD little changed below 1.2200, on fears of the impact of the U.K.'s impending exit from the European Union.
3. Global stocks drop amid Fed rate hike chatter, weak China data
U.S. stock index futures pointed to a sharply lower open on Thursday morning, with the Dow futures falling more than 100 points, as traders eyed the release of data and earnings.
There are a few economic reports on Thursday, including data on weekly jobless claims and import prices at 8:30AM ET (12:30GMT), while the federal budget is due at 2:00PM ET (18:00GMT).
Meanwhile, Delta Air Lines (NYSE:DAL), First Republic Bank (NYSE:FRC) and Winnebago (NYSE:WGO) are among companies set to report before the bell on Thursday morning, while Infosys (NYSE:INFY) is due to report after the bell. Friday will see Citigroup (NYSE:C), JPMorgan (NYSE:JPM) and Wells Fargo report.
Elsewhere, European and U.K. stocks were broadly lower in mid-morning trade, with Germany's DAX down more than 1%, after minutes from the Fed's September meeting underlined expectations of tighter monetary policy before the end of the year and as weak China trade data dampened sentiment.
Earlier, Asian shares ended mostly lower, as investors reacted to the Federal Reserve’s latest thoughts and fresh Chinese economic data.
4. U.S. weekly oil stockpile data ahead
The U.S. Energy Information Administration will release its weekly report on oil supplies at 11:00AM ET (15:00GMT) Thursday, amid analyst expectations for an increase of 650,000 barrels. This would be the first rise in oil stocks following five straight weeks of declines.
Gasoline inventories are expected to fall by 1.5 million barrels while stocks of distillates, which include heating oil and diesel, are forecast to drop by 1.6 million barrels.
The report comes out one day later than usual due to Monday's Columbus Day holiday.
After markets closed Wednesday, the American Petroleum Institute said that U.S. oil inventories increased by 2.7 million barrels in the week ended October 7. The API report also showed a gain of 700,000 barrels in gasoline stocks, while distillates showed a drop of 4.5 million barrels on the week.
U.S. crude was down 13 cents, or 0.26%, to $50.05 a barrel, while Brent slipped 5 cents, or 0.1%, to $51.76 a barrel.
5. Wells Fargo CEO Stumpf retires effective immediately
Wells Fargo's (NYSE:WFC) chairman and chief executive officer, John Stumpf, abruptly departed on Wednesday, bowing to pressure over its sales tactics that has damaged the bank's reputation and put Wall Street under renewed scrutiny.
The bank said Stumpf will retire effective immediately and would be replaced as chief executive by President and Chief Operating Officer Tim Sloan.
The news comes after it was revealed that employees in Wells Fargo's community banking division opened about 2 million accounts without customer authorization, which resulted in the bank paying $185 million in penalties.
The bank's shares, which have slumped in the wake of the scandal, rose 2% in pre-market trading.