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Apple's Big Tax Bill, Failed Merger And Bank Earnings

Published 2016-08-30, 08:44 a/m
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US markets are trading slightly lower as traders continue to digest hawkish FOMC comments out of last weekend's Jackson Hole Conference and anticipate the big payroll and PMI reports which start tomorrow.

Dow and S&P futures are down 0.1% while Nasdaq futures are down 0.25%, dragged down by Apple (NASDAQ:AAPL). The FTSE is flat coming back from a holiday while the DAX is up 0.8%.

USD is slightly stronger against gold and major currencies while WTI crude oil has bounced back a bit, climbing 0.7% today. Fed Vice chair Fischer, who called for a September rate hike following Fed Chair Yellen's Friday comments, today indicated in an interview he's not looking at a one and done increase, leaving the door open to a second hike in December or March.

It's a quieter day for economic news but there are a number of big corporate developments which could move individual stocks and sectors today.

Apple is in the spotlight for all the wrong reasons today after the ‎EU ruled that Ireland gave Apple undue tax benefits of up to €13B between 2002 and 2014 and ordered the country to collect. Ireland is expected to appeal, but the news could put pressure on Apple shares this morning.

It also could impact trading in other big multinationals who have benefitted from playing countries off each other to lower their tax rate. Companies' big presences in the EU could be particularly impacted with their more agressive focus on tax avoidance at the moment.

Hershey (NYSE:HSY) may also see support cave in today after Mondelez dropped its takeover bid for the candy maker.

‎In Canada today the banks are back in focus, with Bank of Nova Scotia (TO:BNS) posting strong earnings of $1.54 per share, beating the street's $1.48 estimate. Gains were balanced across the Canadian and International Markets divisions. The bank's provision for credit losses of $571M was less than expected, and a small dividend increase can be seen as a positive.

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