Friday, April 10th, 2015View Older Reports
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OVERNIGHT MARKETS AND NEWS
June E-mini S&Ps (ESM15 +0.13%) this morning are little changed. The Euro Stoxx 50 index this morning is up +0.68%, extending this week's rally. Asian stocks today closed mostly higher: Japan -0.15%, Hong Kong +1.22%, China +1.94%, Taiwan +0.52%, Australia +0.61%, Singapore +0.35%, South Korea +1.40%, India -0.02%, Turkey -0.62%. China's Shanghai index rallied by +1.94% today as investors hope that China's tepid March CPI report of +1.4% leaves room for the Chinese central bank to ease another notch.The dollar index (DXY00 +0.44%) is up +0.38 points (+0.38%) as this week's rally continues based in part on Wednesday's March 17-18 FOMC minutes that said "several" FOMC members thought a rate hike might occur by June. EUR/USD (^EURUSD) is down -0.0075 (-0.70%). USD/JPY (^USDJPY) is down -0.25 (-0.21%). Jun 10-year T-notes (ZNM15 +0.01%) are up +1.5 ticks.
Commodity prices are up +0.33% this morning. May WTI crude oil (CLK15 -0.39%) is down -0.14 (-0.28%), but May Brent crude (CBK15 +0.49%) is up +0.24 (+0.42%) and May gasoline (RBK15 +0.78%) is up +0.0127 (+0.72%). May natural gas (NGK15 +0.71%) is up +0.016 (+0.63%).
Precious metals prices are higher after this week's losses on the strong dollar: Jun gold (GCM15 +0.86%) +9.7 (+0.81%), May silver (SIK15 +2.06%) +0.324 (+2.00%). May copper (HGK15 +0.68%) is up +0.026 (+0.95%). Grain prices and softs are mixed.
The yield on French 5-year notes today dropped 2 bp to a negative -0.004%, which means that investors are paying the French government to park their cash. The German 4-year yield today was at -0.195%. European yields have dropped to extraordinarily low levels thanks to weak economic growth, low inflation, and the ECB's QE program of buying 60 billion euros of securities per month.
China's March CPI was unchanged from Feb at +1.4% y/y, which was a bit stronger than market expectations for a dip to +1.3% y/y. China's March PPI strengthened slightly to -4.6% y/y from -4.8% y/y in Feb, which was a bit stronger than market expectations for an unchanged level of -4.8% y/y.
U.S. STOCK PREVIEW
Key U.S. news today includes (1) March import prices (expected -0.4% m/m and -10.2% y/y after Feb's +0.4% m/m and -9.4% y/y), (2) the Treasury's March monthly budget statement (expected -$43.0 billion, Feb -$192.327 billion, (3) a speech today by Richmond Fed President Jeffrey Lacker on the economic outlook at an event in Sarasota, FL, and (4) a speech by Minneapolis Fed President Narayana Kocherlakota at the Minnesota Credit Union Network Annual Meeting and Convention.None of the Russell 1000 companies report earnings today.
There are no U.S. IPO's that price or trade today.
There are no equity conferences today.
June E-mini S&Ps this morning are little changed. Thursday's closes: S&P 500 +0.45%, Dow Jones +0.31%, Nasdaq +0.48%. The stock market on Thursday closed moderately higher on the drop in U.S. continuing unemployment claims to a new 14-1/3 year low along with relief that Greece on Thursday made its 450 million euro payment to the IMF. There was also continued optimism about the recent spate of M&A deals and carry-over support from the 1.1% rally in the Euro Stoxx 50 index and the +2.7% rally in the Hong Kong Hang Seng index.
OVERNIGHT U.S. STOCK MOVERS
- GE (GE +2.88%), in a bid to boost profitability, confirmed a deal to sell $26.5 billion of real estate, authorized a new $50 billion stock buyback plan, and will work to terminate GE Capital's designation as a Systemically Important Financial Institution (SIFI).
- Netflix (NFLX -0.42%) was upgraded to Buy from Neutral at Citigroup after the recent pullback and the target was raised to $525 from $409.
- GM (GM +0.50%) was adding to Citigroup's Focus List as the analyst says the recent 6% decline provides a buying opportunity.
- Ruby Tuesday (RT -1.23%) reported Q3 EPS of -1 cent, which was better than expectations of -4 cents.
- Deutsche Bank (DB -0.79%) is close to a deal in its LIBOR case, according to the NY Times.
- Worldwide PC shipments declined by -6.7% in Q1 to 68.5 million units, according to IDC.
MARKET COMMENTS
Jun 10-year T-notes this morning are up +1.5 ticks. Thursday's closes: TYM5 -16.5, FVM5 -9. June 10-year T-notes on Thursday sold off fairly sharply due to poor demand for the 30-year bond auction and reduced safe-haven demand with the rally in stocks. The 30-year bond auction saw a bid cover ratio of only 2.18, which was below the 12-auction average of 2.40.The dollar index this morning is up +0.38 points (+0.38%) as this week's rally continues based in part on Wednesday's March 17-18 FOMC minutes that said "several" FOMC members thought a rate hike might occur by June. EUR/USD is down -0.0075 (-0.70%). USD/JPY is down -0.25 (-0.21%). Thursday's closes: Dollar index +1.22 (+1.24%), EUR/USD -0.0122 (-1.13%), USD/JPY +0.45 (+0.37%). The dollar index on Thursday rallied sharply to post a new 3-week high on continued support from Wednesday's March 17-18 FOMC minutes which disclosed that "several" FOMC members favored a rate hike as soon as the June FOMC meeting.
May WTI crude oil this morning is down -0.14 (-0.28%), but May Brent crude is up +0.24 (+0.42%) and May gasoline is up +0.0127 (+0.72%). Thursday's closes: CLK5 +0.37 (+0.73%), RBK5 +0.0200 (+1.15%). May crude oil and gasoline on Thursday closed moderately higher on some short-covering after Wednesday's 6.6% plunge in May crude oil and -6.1% plunge in May gasoline. Wednesday's losses were sparked mainly by the EIA report's news that U.S. oil inventories surged by +10.95 million bbl (+2.3%) to a new record high and showed the largest increase in 14 years.
GLOBAL EVENT CALENDAR04/10/2015
| US | 0830 ET | Mar import price index expected -0.4% m/m and -10.2% y/y, Feb +0.4% m/m and -9.4% y/y. |
| 0830 ET | Richmond Fed President Jeffrey Lacker speaks on the economic outlook at an event in Sarasota, FL. | |
| 1220 ET | Minneapolis Fed President Narayana Kocherlakota speaks at the Minnesota Credit Union Network Annual Meeting and Convention. | |
| 1400 ET | Mar monthly budget statement expected -$43.0 billion, Feb -$192.327 billion. | |
| UK | 0430 ET | UK Feb industrial production expected +0.3% m/m and +0.3% y/y, Jan -0.1% m/m and +1.3% y/y. |
| 0430 ET | UK Feb manufacturing production expected +0.4% m/m and +1.3% y/y, Jan -0.5% m/m and +1.9% y/y. | |
| 0430 ET | UK Feb construction output expected +2.2% m/m and +1.9% y/y, Jan -2.6% m/m and -3.1% y/y. | |
| 1000 ET | UK Mar NIESR GDP estimate, Feb +0.6% q/q. |
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