Investing.com - Here are the top five things you need to know in financial markets on Friday, November 16:
1. Pound steady even as UK PM may face confidence vote
The pound registered slight gains against the dollar on Friday, recovering slightly after its worst daily decline since October 2016 in the prior session, as uncertainty over a deal between the UK and the European Union over Brexit skyrocketed, with British Prime Minister Theresa May “likely” facing a vote of no confidence.
Sky News reported that government officials have been told to cancel engagements and return to London in preparation for the vote which requires a motion from just 48 officials. The threshold is expected to be reached later on Friday with a vote reported to be likely next Tuesday.
The hostility from government and opposition lawmakers raised the risk that the deal would be rejected in the UK parliament, and that Britain could leave the EU on March 29 without a safety net.
Sterling hovered near Thursday’s lows of lows of $1.2722 and €1.1247.
2. China trade “talks” have not halted U.S. tariff plan
Recent hopes that trade tension between China and the U.S. may be receding on reports of continuing talks ahead of U.S. President Donald Trump and Chinese President Xi Jinping at the G20 summit later this month began to fade as officials deemed a deal to be unlikely.
A senior Trump administration official told Reuters on Thursday that China’s written response to U.S. demands for trade reforms, received earlier this week, was unlikely to trigger a breakthrough deal.
U.S. Trade Representative Robert Lighthizer on Thursday denied a report that he had told some industry executives that another round of tariffs on Chinese imports had been put on hold as the two nations pursue talks.
“The plan for the tariffs ... has not changed at all. Any reports to the contrary are incorrect," a spokesperson for Lighthizer’s office said in a statement.
3. Nvidia’s disappointing outlook hammers chip stocks
Nvidia forecast disappointing sales of its chips for the holiday quarter in a woeful reminder of reported weakness in Apple (NASDAQ:AAPL) suppliers, sending tech stocks in the semiconductor sector sprawling.
Shares of Nvidia (NASDAQ:NVDA) plunged 17% in Friday’s pre-market trade tainting Advanced Micro Devices (NASDAQ:AMD) with losses of 5%.
Friday’s earnings schedule will be sparse with the focus on Viacom (NASDAQ:VIAB) whose results are expected ahead of the opening bell.
4. Nasdaq expected to lead losses on Wall Street
As hopes for a thawing of trade tension between the U.S. and China fade to the background and uncertainty surrounding a possible Brexit deal between the UK and EU rise, U.S. futures pointed to a lower open on Wall Street. Nvidia’s disappointing outlook hit sentiment on tech stocks with the Nasdaq expected to lead the losses.
At 5:54 AM ET (10:54 GMT), the blue-chip Dow futures fell 89 points, or 0.35%, S&P 500 futures lost 14 points, or 0.49%, while the Nasdaq 100 futures traded down 78 points, or 1.16%.
Elsewhere, European stocks struggled to recover after a rough week where Brexit tensions and worries over the Italian budget sent shares sprawling. Investors remained cautious as they waited for the UK to make a move on whether to oust Theresa May from power.
Earlier, Asian share markets ended mixed on Friday as hopes for a thaw in the Sino-U.S. trade standoff were tempered by disappointing results from chipmaker Nvidia which slugged the tech sector.
5. Oil rebounds as attention turns to hopes for output cuts
Oil prices surged on Friday, recovering part of a sharp weekly decline, as attention began to turn to hopes that OPEC would be able to reach a meaningful deal to cut output and tackle rising supply at its policy meeting in Vienna on Dec. 6.
U.S. crude was on the rise for a third consecutive session paring weekly losses to below 5% as reports on Wednesday suggested that OPEC was mulling a plan with Russia and other allies to cut production by 1.4 million barrels in order to reign in the recent decline in prices and rebalance the market.
Concerns of oversupply will remain in the spotlight as investors keep an eye on a measure of future output stateside with Baker Hughes’ weekly data out at 1:00 PM (18:00 GMT) Friday.
The U.S. rig count rose by 8 to 874 last week, the highest level since March 2015, according to the oilfield services firm.