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OVERNIGHT MARKETS AND NEWS
Jun E-mini S&Ps (ESM16-0.38%) are down -0.31% and European stocks are down -0.89% on signs of lackluster global manufacturing activity. The German May Markit/BME manufacturing PMI was revised lower, Japan's May Nikkei PMI contracted at the steepest pace in over 3 years, and China's May manufacturing PMI remained basically flat. A -1.22% slide in July WTI crude oil (CLN16-1.20%) to a 1-week low undercut energy producers, and U.S. stocks were under pressure after the OECD revised its U.S. 2016 GDP forecast downward. Asian stocks settled mostly lower: Japan -1.62%, Hong Kong -0.26%, China -0.11%, Taiwan +0.72%, Australia -1.03%, Singapore -0.02%, South Korea -0.02%, India +0.17%.
The dollar index (DXY00-0.38%) is down -0.34% after the OECD cut its U.S. 2016 GDP forecast and EUR/USD (^EURUSD) is up +0.26% after the OECD raised its Eurozone 2016 GDP forecast to 1.6% from a Feb estimate of 1.4%. USD/JPY (^USDJPY) is down -1.11%.
The OECD cut its U.S. 2016 GDP estimate to 1.8% from a Feb projection of 2.0% and raised its Eurozone 2016 GDP forecast to 1.6% from a Feb estimate of 1.4%. The OECD kept its global 2016 GDP estimate unchanged at 3.0%, but warned that the global economy is slipping into a self-fulfilling "low-growth trap" where ultra-loose monetary policy risks doing more harm than good.
The China May manufacturing PMI was unchanged at 50.1, stronger than expectations of -0.1 to 50.0.
The German May Markit/BME manufacturing PMI was revised downward to 52.1 from the originally reported 52.4.
The Japan May Nikkei manufacturing PMI was revised upward to 47.7 from the originally reported 47.6, still the steepest pace of contraction since the data series began in 2013.
U.S. STOCK PREVIEW
Key U.S. news today includes: (1) weekly MBA mortgage applications (previous +2.3% with purchase sub-index +4.8% and refi sub-index +0.4%), (2) revised-May Markit U.S. manufacturing PMI (expected unrevised at 50.5, preliminary-May -0.3 to 50.5), (3) May ISM manufacturing index (expected -0.5to 50.3, Apr -1.0 to 50.8), (4) Apr construction spending (expected +0.6%, Mar +0.3%), (5) Fed Beige Book, (6) May total vehicle sales (expected 17.30 million, Apr 17.32 million).
There are 2 of the Russell 1000 companies that report earnings today: Michael Kors Holdings (consensus $0.97), Alere (0.58).
U.S. IPO's scheduled to price today: Nant Health LLC (NH).
Equity conferences during the remainder of this week include: Deutsche Bank Global Financial Services Investor Conference on Tue-Wed, BMO Capital Markets Energy & Power Conference on Wed, D. A. Davidson & Co Technology Forum on Wed, Stifel Dental & Veterinary Conference on Wed, Bank of America Merrill Lynch Global Technology Conference on Wed-Thu, Cowen and Company Technology, Media & Telecom Conference on Wed-Thu, RBC Capital Markets Consumer & Retail Conference on Wed-Thu, Bernstein Strategic Decisions Conference on Wed-Fri, Credit Suisse Engineering & Construction Conference on Thu, Keefe, Bruyette & Woods Asset Management Conference on Thu, American Society of Clinical Oncology (ASCO) Meeting on Fri.
OVERNIGHT U.S. STOCK MOVERS
Nike (NKE-1.73%) fell 2% in pre-market trading after it was downgraded to 'Neutral' from 'Buy' at Bank of America/Merrill Lynch.
Whole Foods Markets (WFM +1.00%) jumped over 2% in pre-market trading after it was upgraded to 'Outperform' from 'Neutral' at Credit Suisse.
Zoetis (ZTS +0.51%) was rated a new 'Buy' at Stifel with a 12-month price target of $58.
InterXion Holding NV (INXN +0.86%) rose nearly 1% in after-hours trading after it was upgraded to 'Outperform' from 'Market Perform' at Wells Fargo Securities.
Alibaba Group Holding Ltd. (BABA +1.27%) fell over 2% in pre-market trading after Softbank Group, the largest investor in Alibaba, said it will sell at least $7.9 billion of its Alibaba stake.
Under Armour (UA-0.50%) lost more than 3% in after-hours trading after it cut its full-year net revenue estimate to $4.925 billion from a prior view of $5 billion.
Quanex Building Products (NX +2.47%) reported Q2 adjusted EPS of 10 cents, better than consensus of 9 cents, and boosted its full-year Ebitda estimate to $117 million-$121 million from a December 14 estimate of $112 million-$120 million.
Ascena Retail (ASNA +1.12%) dropped nearly 6% in after-hours trading after it lowered guidance on full-year EPS to 67 cents-70 cents from a prior view of 75 cents-80 cents.
Zoe's Kitchen (ZOES +2.47%) climbed over 3% in after-hours trading after it reported Q1 adjusted EPS of 6 cents, better than consensus of 4 cents, and then raised its full-year revenue estimate to $277 million-$281 million from a prior estimate of $275 million-$289 million.
NCI Building Systems (NCS +2.48%) reported Q2 sales of $372.2 million, higher than consensus of $363.5 million.
Boyd Gaming (BYD +0.48%) rose more than 4% in after-hours trading after MGM Resorts International acquired Boyd's 50% stake in Atlantic City's Borgata hotel and casino for $900 million.
TiVo (TIVO-0.70%) slipped 3% in after-hours trading after it reported Q1 EPS of 4 cents, weaker than consensus of 8 cents.
June E-mini S&Ps (ESM16-0.38%) this morning are down -6.50 points (-0.31%). Tuesday's closes: S&P 500 -0.10%, Dow Jones -0.48%, Nasdaq +0.25%. The S&P 500 on Tuesday fell back from a 1-1/4 month high and closed lower on the unexpected -2.1 point decline in U.S. May consumer confidence (Conference Board) to 92.6 (weaker than expectations of +1.9 to 96.1 and a 6-month low) and the unexpected -1.1 point decline in the May Chicago PMI (weaker than expectations of +0.1 to 50.5). Stocks were boosted by the +1.0% m/m increase in U.S. Apr personal spending, stronger than expectations of +0.7% m/m and the largest increase in 6-1/2 years.
September 10-year T-note prices (ZNU16 +0.06%) this morning are up +1 tick. Tuesday's closes: TYU6 -0.50, FVU6 -0.25. Sep T-notes on Tuesday fell to a 1-month low but recovered and closed little changed. T-notes were undercut by negative carry-over from Friday's comments by Fed Chair Yellen who said a Fed rate hike in coming months may be "appropriate." T-notes were also undercut by the sharp +1.0% increase in U.S. Apr personal spending. T-notes found support on the decline in the U.S. May consumer confidence index to a 6-month low and by the weak May Chicago PMI.
The dollar index (DXY00-0.38%) this morning is down -0.327 (-0.34%). EUR/USD (^EURUSD) is up +0.0029 (+0.26%). USD/JPY (^USDJPY) is down-1.23 (-1.11%). Tuesday's closes: Dollar Index +0.370 (+0.97%), EUR/USD -0.0006 (-0.05%), USD/JPY -0.39 (-0.35%). The dollar index on Tuesday closed higher on carryover support from Friday's hawkish comments Friday by Fed Chair Yellen who said a Fed rate hike in coming months may be "appropriate." The dollar was also boosted by the stronger-than-expected U.S. Apr personal spending of +1.0%, which rose at the fastest pace in 6-1/2 years and bolstered the case for a Fed rate hike.
July WTI crude oil (CLN16-1.20%) this morning is down -60 cents (-1.22%) at a 1-week low. July gasoline (RBN16-0.60%) is down -0.0117 (-0.73%) at a 2-week low. Tuesday's closes: CLN6 -0.23 (-0.47%), RBN6 -0.0244 (-1.49%). July crude oil and gasoline on Tuesday closed lower on the stronger dollar and on expectations that OPEC members will be unable to agree on production cuts when the cartel meets on Thursday in Vienna.
GLOBAL EVENT CALENDAR06/01/2016
Weekly MBA mortgage applications, previous +2.3% with purchase sub-index +4.8% and refi sub-index +0.4%.
Revised-May Markit U.S. manufacturing PMI expected unchanged at 50.5, preliminary-May -0.3 to 50.5.
May ISM manufacturing index expected -0.5 to 50.3, Apr -1.0 to 50.8. May ISM new orders, Apr -2.5 to 55.8. May ISM employment, Apr +0.9 to 49.2. May ISM prices paid expected -1.0 to 58.0, Apr +7.5 to 59.0.
Apr construction spending expected +0.6%, Mar +0.3%.
Fed Beige Book.
May total vehicle sales expected 17.30 million, Apr 17.32 million. May domestic vehicle sales expected 13.58 million, Apr 13.48 million.
Japan May vehicle sales, Apr +7,2% y/y.
Revised German May Markit/BME manufacturing PMI, preliminary +0.6 to 52.4.
Revised Eurozone May Market manufacturing PMI, preliminary -0.2 to 51.5.
UK My nationwide house prices expected +0.3% m/m and +4.8% y/y, Apr +0.2% m/m and +4.9% y/y.
UK Apr net consumer credit expected +1.6 billion pounds, Mar +1.9 billion pounds.
UK Apr mortgage approvals expected 67,900, Mar 71,400.
UK Apr M4 money supply, Mar -0.4% m/m and +1.6% y/y.
UK May Markit manufacturing PMI expected +0.4 to 49.6, Apr 49.2.
U.S. STOCK CALENDAR06/01/2016
Michael Kors Holdings Ltd
Q4 2016 Earnings Release
Michael Kors Holdings Ltd
Q4 2016 Earnings Call
ALKS 5461 FORWARD-3 & FORWARD-4 Data Study Results Call