October 19, 2017 / 10:57 AM / a month ago

Thursday Morning Briefing

Senate Republicans are poised to approve a measure that would help pass Trump’s tax reforms, a special report lifts the lid on a backroom battle threatening a $230 million cryptocurrency venture and thirty years on from the 1987 stock market crash, cautious traders wonder if it could happen again.

Kenyan opposition leader Raila Odinga, the presidential candidate of the National Super Alliance (NASA) coalition, arrives for a political rally at the Kamukunji grounds in Nairobi, Kenya, October 18, 2017. REUTERS/Baz Ratner

Washington

President Donald Trump’s drive to overhaul the U.S. tax code is headed for a pivotal moment, with Senate Republicans poised to approve a budget measure that would help them pass tax legislation without Democratic support.  

Trump has selected Joseph Simons, an antitrust attorney from a Washington law firm, to head the Federal Trade Commission, a White House official said. Trump is expected to nominate Simons to the agency, along with Noah Phillips and Rohit Chopra to be FTC commissioners. Read the exclusive.  

‘The check has been sent’: That was the message from the White House after the father of a slain U.S. Army sergeant said a generous offer from Trump had not materialized.  

Markets

Thirty years ago, before heading to work at the New York Stock Exchange, Peter Kenny left his home in lower Manhattan and made a detour a church to pray to St. Jude, the Roman Catholic patron saint of desperate and lost causes. “Blessed mother get me through this,” he prayed. The reason was the stock market crash known as “Black Monday” - the worst trading day in U.S. history. 

On the 30th anniversary of the 1987 crash, U.S. stocks are at a record high and investors are concerned that steep valuations may mean a correction is overdue, despite healthy corporate earnings and economic growth. Could a repeat of “Black Monday” happen today?  

Reuters TV: Life after the 1987 crash - 30 years on  

Business

World stocks set a fresh record high before stalling in Europe, as the longest winning streak for Japanese stocks since 1998 and the first close above 23,000 for Wall Street’s Dow index helped to offset nerves in Spain. 

Three Japanese automakers said they found no safety issues with aluminum parts made by Kobe Steel, allaying some concerns that falsified quality data on products from the steelmaker had compromised their vehicles.  

Unilever reported lower-than-expected third-quarter sales, losing market share to smaller competitors and dampening hopes that an aborted takeover offer from Kraft Heinz would spark a swift improvement.  

Eagle Prime (MK3), a giant robot by MegaBots Inc. which manufactures giant piloted humanoid fighting robots headquartered in Berkeley, California, U.S. is shown in Japan in this undated photo released on October 17, 2017. Courtesy Michael Mauldin/MegaBots Inc./Handout via REUTERS

Eagle Prime (MK3), a giant robot by MegaBots Inc. which manufactures giant piloted humanoid fighting robots headquartered in Berkeley, California, U.S. is shown in Japan in this undated photo released on October 17, 2017. Courtesy Michael Mauldin/MegaBots Inc./Handout via REUTERS

Investors are betting on China’s potential to feed the global pharmaceutical pipeline, putting a multi-billion-dollar price tag on a handful of stocks, even as the country struggles to close a huge R&D gap with the West.  

Swiss food giant Nestle expects organic sales growth to stay muted in the fourth quarter and is speeding up its restructuring program as it seeks to improve profit margins.  

Breakingviews - Global watchdogs may curb U.S. deregulatory push  

Special Report

The people running the Tezos blockchain project collected millions in a wildly successful fundraiser, but the project has yet to get off the ground and arguments are rife behind the scenes. Reuters investigates Tezos and takes a closer look at the risks of investing in ICOs.  

More Reuters fintech coverage. 

World

Top Chinese officials have praised President Xi Jinping’s political ideology unveiled at a key Communist Party Congress, an indication that he could cement his power with his new slogan being incorporated into the party’s constitution.  

Spain’s central government threatened to suspend Catalonia’s autonomy after the region’s leader said it could go ahead with a formal declaration of independence if Madrid continued its “repression”.  

The Afghan Taliban stormed a military base in the south of the country killing at least 43 troops, the Defence Ministry said, with the militants putting the toll at at least 60.  

As Japan prepares to vote in Sunday’s national election, Prime Minister Shinzo Abe has called North Korea’s escalating threats -- it also conducted a sixth nuclear test last month -- a “national crisis” that only he can lead Japan through. Yet the missiles that flew over a fishing town on Japan’s northern island of Hokkaido on Aug. 29 and Sept. 15 created an eerie threat: No one saw or heard them. They streaked by several hundred kilometers above land, too high to see with the naked eye, before splashing into the Pacific more than 1,000 kilometers (600 miles) to the east. 

Iran’s elite Islamic Revolutionary Guards said its ballistic missile program would accelerate despite U.S. and European Union pressure to suspend it, the semi-official Tasnim news agency reported. 

New Zealand’s next prime minister will be Jacinda Ardern, whose Labour party won the support of a small nationalist party to form the government, spelling big changes for a small but open economy, whose currency hit a 4-1/2-month low on the news. 

Kenyan President Uhuru Kenyatta snubbed a crisis meeting called by the chairman of the election board for Thursday, saying he would instead spend the day campaigning for next week’s presidential vote re-run. 

Commentary

Most of the framers of the U.S. Constitution would probably be appalled by Trump's decision to sign an executive order undermining the Affordable Care Act, writes Scott Lemieux. "But in terms of formal executive power, there’s ample precedent for Trump’s actions." The expansion, and sometimes misuse, of executive power, says Lemieux, "is a result produced in large measure by the framers’ choices to dilute accountability and responsibility in the federal government, and their designing a presidential system in which a minority party can regularly win." 

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