In the U.S.:
- As expected, the Fed lowered rates by 25bps. However, the Fed indicated that the bar for any future rate cuts would be high as they eliminated some key language such as the “act as appropriate” pledge.
- In earnings, 358 companies in the S&P 500 Index have reported, 80.5% beat, 0.9% were in-line, and 18.6% missed estimates.
Bloomberg, citing comments from the earnings call, reported that CyrusOne (CONE) was not pursuing a sale, contradicting previous articles stating otherwise.
In REIT earnings, 80 companies in the Wilshire U.S. REIT Index have reported, 60 beat, 3 were in-line, and 17 missed estimates.
- China’s Foreign Ministry stated that they would soon announce a new location at which US President Trump and Xi Jinping would sign a “phase one” trade deal. Chile’s abrupt cancellation of the November APEC summit, due to civil unrest and protests, led the two countries to scramble for a new venue to sign the deal. Overall, trade deal details have been positive this week with both sides ratcheting down damaging rhetoric.
- October Caixin manufacturing PMI unexpectedly rose to 51.7 versus September’s 51.4 reading. The higher reading was led by a pick up in output and an uptick in foreign new orders.
- October Manufacturing PMI was 48.4 versus September’s 48.9 reading. The drop was led by lower demand as less front loading ahead of the proposed sales tax hike took place.
CapitaLand Ltd. will sell 30 business parks in the U.S. and Singapore to Ascendas Real Estate Investment Trust for S$1.66 billion. Ascendas intends to fund acquisition using net proceeds from proposed rights issue, draw down of loan facilities, and the issuance of acquisition fee units.
- Preliminary Eurozone Q3 GDP grew 0.2%, unchanged from Q2 for an annual growth rate of 1.1%. Eurozone inflation dropped 0.7% in October on weak energy and non-energy industrial good prices.
Unibail-Rodamco-Westfield (URW) reported interim financial information as of September 30, 2019 this week with tenant sales across its Continental Europe portfolio increasing 5.2% for the first nine months of the year, a slight deceleration from +5.3% reported at the half year ending June 30th. Tenant sales did benefit from the ongoing growth of Tesla sales following the delivery of the Model 3. Sales across Continental Europe increased 2.9% excluding Tesla. Tenant sales in the UK increased 5.2% versus +7.9% at the half year. In the US, tenant sales increased 6.2% thru September. Footfall was up 3.1% through September across in Continental Europe shopping centers, +3.9% in the UK. The company did not provide any update on any asset disposals since what was reported with its half year results in July. The company did indicate that it expects its Adjusted Recurring EPS to be at the upper end of the €12.10/sh – €12.30/sh range provided in July. It is unclear if part of the improved outlook for 2019 EPS is due to lower than expected dilution from asset sales.
The views expressed in this update are as of the date of this blog entry. These views and any portfolio holdings discussed in the update are subject to change at any time based on market or other conditions. The adviser disclaims any duty to update these views, which may not be relied upon as investment advice. In addition, references to specific companies’ securities should not be regarded as investment recommendations or indicative of the Adelante products, strategies, or portfolios.