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Top 5 Things to Know in the Market on Friday

Investing.com -- China's external trade improves, and Germany's exporters likely kept Europe's largest economy out of recession in the third quarter. Meanwhile Disney's traditional strength in movies is helping it shoulder the high costs of rolling out its Netflix-killer Disney+. Here's what you need to know in financial markets on Friday, 8th November.

1. China's exports bottom out

The reason for China’s increasing assertiveness in trade discussions with the U.S. became arguably a little clearer, after both exports and imports performed better than expected in September.

Exports showed signs of bottoming out with a drop of only 0.9% year-on-year, better than the 3.5% drop expected, while the decline in imports eased to only 6.9% from 8.5% in August. Imports were still down year-on-year for the sixth month in a row, however.

And it’s not like the Chinese economy is all roses: data out earlier showed car sales continued their freefall in October, falling 6% on the year. That’s the 16th month out of 17 that they’ve fallen in year-on-year terms.

The yuan held below 7 to the dollar, despite Thursday’s setback as Washington pushed back on China’s claims about an imminent trade truce.

2. Brighter news from Europe

There was also better news from Europe overnight as German exports posted their biggest increase in six months in September, something that analysts said may just have saved the region’s largest economy from recession in the third quarter.

Data from west of the Rhine also showed that French industrial production continued to expand, reflecting a lesser degree of exposure to China than its bigger neighbor, while figures also showed that job creation accelerated in the third quarter as the labor reforms of President Emmanuel Macron bore fruit.

Elsewhere, outgoing European Commission President Jean-Claude Juncker predicted in an interview with the Sueddeutsche Zeitung that he didn’t expect the U.S to impose tariffs on European automakers next week as President Donald Trump had previously threatened.

3. Stocks set to open flat to lower; bond yields hit three-month highs

U.S. stock markets are set to open a touch lower, extending the pullback that started after source reports pushing back against China’s upbeat version of trade discussions with the U.S.

By 6:30 AM ET (1130 GMT), Dow futures were unchanged, while S&P 500 Futures and the Nasdaq 100 contract were both down less than 0.1%.

The 10-year Treasury yield meanwhile hit 1.96% overnight, its highest since the start of August, before pulling back to trade at 1.91%. Other haven assets continued to labor, with gold futures languishing at $1,466.35 a troy ounce.

With earnings season starting to wind down, the day’s roster is headed by Duke Energy and Canadian pipeline company Enbridge. First Data, Ameren, Madison Square (NYSE:SQ) Gardens and aircraft leasing company AerCap are all also scheduled to report.

4. Disney shines

Walt Disney’s profit more than halved in the three months to September due to the costs of launching a streaming service to rival Netflix (NASDAQ:NFLX). Disney is cranking up output not just for its Disney+ service, but also for Hulu (which it now controls) and ESPN.

But prodigious takings from The Lion King and Toy Story 4 helped it to beat expectations. Box office revenue rose 52% and operating income rose 79% on the year in the quarter.

The shares rose 5.3% in after-hours trading while Netflix’s slipped 0.2%.

5. Alibaba's plans for a mega-listing in Hong Kong

Alibaba (NYSE:BABA) is preparing to sell up to $15 billion worth of shares on the Hong Kong stock exchange in a secondary offering planned for later this month, various reports said.

China’s most valuable company is planning to launch the sale after its Nov. 11 ‘Singles Day’ event, the Chinese equivalent of Black Friday. The deal would be the largest share sale of the year to date - although it's likely to be upstaged almost immediately by Saudi Aramco.

The move, which early reports suggested was an insurance policy against possible measures restricting Chinese companies’ access to U.S. capital markets, comes on the heels of founder Jack Ma’s stepping down as chief executive.

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