Today's Headlines

Bloomberg:  

• Islamic State Earns $800 Million a Year From Oil Sales. The Islamic State is earning about $2 million a day, or $800 million a year, selling oil on the black market, IHS Inc. estimated. The terrorist group is producing 50,000 to 60,000 barrels a day, according to an e-mailed release today from the Englewood, Colorado-based information company. It controls as much as 350,000 barrels a day of capacity in Iraq and Syria. 
• China’s Wealth Gap Threatens Social Stability, Researcher Says. China’s growing wealth inequality may severely damage social stability, a researcher with the ruling Communist Party said. Tax evasion, fraud and corruption are among the reasons for the widening wealth gap, Xie Chuntao, an academic with the ruling Communist Party, said at a briefing today.
• Philips Profit Misses Estimates on Woes in China, Russia. Royal Philips NV (PHIA) reported quarterly earnings that missed analyst estimates because of unfavorable exchange rates and sluggish demand in China and Russia. Earnings before interest, taxes, amortisation and one-time items dropped 16 percent to 536 million euros ($684 million) in the third quarter, missing a 554 million-euro analyst estimate. The stock dropped as much as 3.2 percent. 
• Brazil Race Tied Less Than 1 Week Before Vote, MDA Shows. Brazil’s President Dilma Rousseff is statistically tied with candidate Aecio Neves less than one week before a runoff election, according to an MDA poll published today. Rousseffhas 45.5 percent support and Neves 44.5 percent, according to the Oct. 18-19 poll commissioned by the National Transport Confederation that has a margin of error of 2.2 percentage points. Rousseff of the Workers’ Party won 42 percent in the first round of voting on Oct. 5, compared to 34 percent for Neves of the Brazilian Social Democracy Party. 
• European Stocks Decline After Four-Week Rout as SAP Drops. (video) European stocks fell, following their longest streak of weekly losses in more than a year, as worse-than-estimated financial results added to concerns over the region’s economic recovery. SAP SE lost 5.8 percent after the world’s largest supplier of business-management software cut its full-year earnings forecast. Royal Philips NV declined 3.7 percent after third-quarter sales and profit missed analysts’ estimates. Nutreco NV rallied the most since at least 1997 after SHV agreed to buy the fish-feed maker. The Stoxx Europe 600 Index slid 0.5 percent to 317.01 at the close of trading, after earlier falling as much as 1.1 percent. 
• Copper Falls on China Concern; Goldman Sees Higher Supply. Copper futures fell for the third time in four sessions on mounting concern that a slowing economy will curb demand in China, the world’s top metal consumer. In the third quarter, the Chinese economy probably expanded at the weakest pace since 2009, the median estimate in a Bloomberg survey showed before official figures due tomorrow. Inventories monitored by the London Metal Exchange will rise over the next six months while supplies increase,Goldman Sachs Group Inc. said in a report on Oct. 17. “The attention is going to shift to China,” Tim Evans, the chief market strategist at Long Leaf Trading Group Inc. in Chicago, said in a telephone interview. “If we continue to see poor data there, where does the growth come from? That conversation will continue to dominate the copper market moving forward.” 
• Oil Falls; OPEC Seen Waiting Till Meeting to Curb Output. Brent for December settlement declined 39 cents, or 0.5 percent, to $85.77 a barrel on the London-based ICE Futures Europe exchange at 1:29 p.m. in New York. Futures reached $82.60 on Oct. 16, the lowest since November 2010. Prices are down 23 percent this year.
• Fed’d Tarullo Warns Banks to Curb Culture of Bad Behavior. Banks may face tougher regulations if they fail to crack down on market misbehavior and other misconduct that’s continued with “disturbing regularity,” Federal Reserve Governor Daniel Tarullo said. “If banks do not take more effective steps to control the behavior of those who work for them, there will be both increased pressure and propensity on the part of regulators and law enforcers to impose more requirements, constraints and punishments,” Tarullo said in the text of his remarks. 
• IBM(IBM) Plunges as CEO Abandons 2015 Earnings Forecast. International Business Machines Corp. plunged the most in more than four years after abandoning an earnings forecast for 2015, as the company struggles to transform fast enough to handle the shift to cloud computing.

Wall Street Journal:

• China Growth Seen Slowing Sharply Over Decade. Conference Board Report Sees Productivity Plummet, Leaders at a Loss. China’s growth will slow sharply during the coming decade to 3.9% as its productivity nose dives and the country’s leaders fail to push through tough measures to remake the economy, according to a report expected to come out Monday.

Barron's:

• Einhorn Likes Solar Stocks, Bets Against French Bonds: Bloomberg.

MarketWatch.com: 

• What to watch for in Apple’s(AAPL) earnings.

CNBC: 

• Watch Art Cashin: Is IBM an omen for earnings? (video)

ZeroHedge:

• "The Economic Outlook Keeps Getting Better And Better" Says Fed President Who Last Week Unveiled QE4.
• But, Stocks Are Cheap... Right? (graphs)
• Why Chinese Growth Forecasts Just Crashed To A Paltry 3.9% - And Are Going Even Lower - In One Chart. (graph)
• On The Origin Of Crashes & Clustering Of Large Losses. (graph)
• E-Mini Liquidity Has Crashed 40% In The Past Quarter, JPMorgan Finds. (graph)
• Hedge Funds Have Worst Week Since 2011: Here Are The Best And Worst Performers In October And 2014.
• ECB Unleashes (Covered) Bond Buying Program, Sovereigns Sell Off. (graph)

Business Insider:

• This Is The Scariest Sentence From IBM's Earnings Announcement. "We saw a marked slowdown in September in client buying behavior, and our results also point to the unprecedented pace of change in our industry."
• ISIS IS Threatening Another Massacre Of Iraq's Yazidi Minority.

Vice:

• Why Is Russia Getting So Aggressive Toward Sweden? An unnamed Swedish government official told newspaper Svenska Dagbladet that "the actions of the Russians are sometimes aggressive and their behavior against signals intelligence planes has been unnerving. It's like during the Cold War.” When Russia invaded Swedish air space with their fighter jets, Swedish former minister of foreign affairs Carl Bildt wrote on his blog that it was "the most serious air violation from Russia" in a decade. Trespassing in the Baltic Sea isn't the only strange behavior Russia has exhibited lately. Last year the country simulated a nuclear attack against Sweden, and Russian jets have been showing off their weapons by exposing their undercarriages when approaching Swedish aircraft.