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| | US Market |  | | NYSE | AMEX | Dow Jones | Nasdaq |  |  |  |  | | Please click on the images to view our interactive charts | | | The major U.S. index futures are pointing to a higher opening on Wednesday, with sentiment reflecting some comfort at the release of weak global data. Earlier in the global trading day, China reported first quarter growth that slowed to a 6-year low and a few other data released by the nation was also insipid. Subsequently, the European Central Bank announced an unchanged monetary policy stance.
A regional manufacturing report released by the New York Federal Reserve showed an unexpected contraction in activity. The weak data could offer some relief from fears of premature monetary policy normalization. Traders may also focus on a few additional reports on homebuilder confidence and industrial production and the Beige Book.
U.S. stocks turned in a mixed performance on Tuesday, as traders reacted to soft retail sales data and some positive corporate earnings even as tech stocks came under pressure. The major averages opened higher but pulled back immediately after the open. After languishing in the red until the mid-session, the Dow Industrials and the S&P 500 Index recovered and remained mostly above the unchanged line for the rest of the session.
At the same time, the Nasdaq Composite continued to languish in the red before ending down 10.96 points or 0.22 percent. The Dow Industrials added 59.66 points or 0.33 percent before ending at 18,037 and the S&P 500 Index ended up 3.41 points or 0.16 percent at 2,096.
Eighteen of the thirty Dow components closed higher, while the remaining twelve stocks declined. Caterpillar (CAT), Chevron (CVX), Goldman Sachs (GS), JP Morgan Chase (JPM), Merck (MRK) and Exxon Mobil (XOM) were among the biggest gainers of the session.
Among the sectors, energy and gold stocks advanced, while semiconductor stocks lost ground in the session.
On the economic front, the Commerce Department reported that retail sales rose 0.9 percent month-over-month in March, softer than the 1.1 percent increase expected by economists. Excluding autos, sales were up 0.4 percent. Excluding autos and gasoline, sales were up a less than expected 0.5 percent. Core retail sales that exclude autos, gasoline and building materials were up a mere 0.3 percent.
Auto sales climbed 2.7 percent and were the best performing category. Sales at online stores, electronics stores and food & beverage stores were all down, while department store, clothing, furniture and building material store sales climbed. The softness was likely due to unseasonably cold winter weather in the Northeast and Midwest.
Meanwhile, a Labor Department report showed that producer prices rose 0.2 percent month-over-month in March. The core producer price inflation rate was also 0.2 percent. Prices of goods were up 0.3 percent, while services prices rose 0.1 percent.
Business inventories at the end of February were up 0.3 percent month-over-month, while annually inventories climbed 3.3 percent. At the same time, business sales were essentially unchanged compared to the previous month but declined 1.2 percent year-over-year. The business inventories to sales ratio was at 1.36 in February compared to 1.30 a year ago. |
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| | US Economic Reports | | | | CADUSD | Oil | Gold | Allbanc |  |  |  |  | | Please click on the images to view our interactive charts | | | Manufacturing activity in New York unexpectedly contracted in the month of April, according to a report released by the Federal Reserve Bank of New York.
The New York Fed said its general business conditions index dropped to a negative 1.2 in April from a positive 6.9 in March, with a negative reading indicating a contraction in regional manufacturing activity. The index turned negative for the first time since last December, surprising economists, who had expected the index to inch up to 7.0.
St Louis Federal Reserve Bank President James Bullard is scheduled to speak on the economy and monetary policy in Washington at 9 am ET.
At 9:15 am ET, the Federal Reserve is due to release its industrial production report for March. The consensus estimate calls for a 0.3 percent decrease in March, while capacity utilization is expected to edge down to 78.7 percent from 78.9 percent.
Industrial production rose 0.1 percent month-over-month in February, while the January reading was downwardly revised by 0.5 percentage points. Manufacturing output declined 0.2 percent, with the production of motor vehicles/parts falling 3 percent. Meanwhile, utility output rose. Capacity utilization edged down 0.2 percentage points to 78.9 percent.
The National Association of Home Builders is set to release the results of its homebuilder confidence survey at 10 am ET. Economists expect the housing market index based on the survey to increase to 55 in April from 53 in March.
The housing market index fell 2 points to 53 in March, marking the lowest reading since last July. The present sales conditions index was down 3 points at 58 and the index measuring prospective buyer traffic slipped 2 points to 37, while the expectations index was unchanged at 58.
The Energy Information Administration is scheduled to release its weekly petroleum status report for the week ended April 10th at 10:30 am ET.
The petroleum status report for the week ended April 3rd showed a 10.9 million barrel increase in crude oil stockpiles to 482.4 million barrels. Inventories were at the highest level for this time of year in at least the last 80 years.
Gasoline inventories rose by 0.8 million barrels and were well above the upper limit of the average range. Meanwhile, distillate inventories edged down by 0.3 million barrels and were in the lower half of the average range.
Refinery capacity utilization averaged 89.2 percent over the four weeks ended April 3rd compared to 88.6 percent over the four weeks ended March 27th.
Federal Reserve Chair Stanley Fischer will chair an IMF panel discussion on Macroprudential tools in Washington at 10:40 am ET.
The Federal Reserve is scheduled to release its Beige Book report that contains anecdotal evidence on conditions in the twelve Federal Reserve districts at 2 pm ET. The report is typically released 2 weeks ahead of the monetary policy meeting. |
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| | Stocks in Focus | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  |  |  |  | | Please click on the images to view our interactive charts | | | Intel (INTC) reported in line first quarter earnings, while its revenues were shy of estimates. The company's second quarter revenue guidance was lackluster, but Intel reintroduced revenue guidance for the full year that was roughly in line with estimates.
Bank of America (BAC) reported first quarter earnings and revenues that were below estimates. PNC Financial's (PNC) reported better than expected first quarter earnings, while its revenues were shy of estimates. USB (UBS) reported first quarter earnings that were in line but revenues were shy of estimates.
Linear Technology (LLTC) reported third quarter earnings and revenues that were ahead of estimates and forecast 2-4 percent sequential revenue growth for its fourth quarter.
CSX (CSX) reported better than expected first quarter results and raised its quarterly dividend by 13 percent to 18 cents per share.
Delta's (DAL) first quarter earnings exceeded estimates, while its revenues were in line.
Healthcare Services Group (HSCG) reported in line first quarter earnings and its revenues exceeded estimates.
Semtech (SMTC) announced that it has completed its previously announced divestiture of its defense and microwave communications infrastructure business to Jariet Technologies.
Netflix (NFLX), SanDisk (SNDK) and Kinder Morgan (KMI) are among the companies due to release their quarterly results after the close of trading. |
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| | European Markets | | European stocks opened higher and after some early apprehension, the major averages in the region are advancing strongly. Traders are reacting to a deal in the telecom space and the European Central Bank rate decision.
In corporate news, Nokia (NOK) and Alcatel-Lucent (ALU) announced their intention to combine their businesses. The agreement struck between the companies calls for Nokia to make an offer of 0.55 new shares of Nokia for each Alcatel-Lucent share. The deal values Alcatel at 15.6 billion euros.
Simultaneously, Nokia said it has initiated a review of strategic options for its HERE business, which provides mapping software.
Hennes & Mauritz reported a 10 percent increase in group sales, including VAT, in March.
Dutch semiconductor equipment maker ASML reported higher profits and sales for its first quarter, although it sees a decline in sales and gross margins in the second quarter.
Danone reported an 8.1 percent increase in first quarter consolidated sales and said it still projects organic net sales growth of 4-5 percent on a like-for-like basis.
On the economic front, revised estimates released by the German Federal Statistical Office showed that annual German HICP inflation came in at 0.1 percent in March, in line with the preliminary estimate.
Meanwhile, data released by French statistical office INSEE showed that annual inflation in France calculated in the form of HICP remained stable in March following a 0.3 percent drop in February. The rate was in line with expectations.
The European Central Bank held its key interest rates unchanged at a record low for a sixth consecutive policy session amid signs that the bank's massive stimulus via asset purchases is helping to boost activity in the euro area economy. The Governing Council kept the refinancing rate unchanged at a record low 0.05 percent, following its meeting in Frankfurt, in line with economists' expectations. |
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| | Asian markets | | | | USDCAD | USDEUR | USDGBP | USDJPY |  |  |  |  | | Please click on the images to view our interactive charts | | | The major Asian markets traded on a lackluster note, with traders reacting to the mixed close on Wall Street overnight, disappointing economic data from China and apprehension ahead of the European Central Bank decision as well as some key U.S. economic data and earnings.
The Chinese and Taiwanese markets fell sharply and the Japanese, Australian, Indonesian, and New Zealand markets also ended lower. Meanwhile, the South Korean, Hong Kong, Singaporean and Malaysian markets gained some ground.
The Japanese market declined despite the yen remaining weak during the session. The Nikkei 225 average languished below the unchanged line for much of the session before ending down 38.92 points or 0.20 percent at 19,870.
Construction machinery stocks ended lower, with JGC, Komatsu and Hitachi among the biggest decliners of the session. Pharma, food, telecom, retail, technology exporters and financial stocks also came under selling pressure. On the other hand, most other export stocks outside of the tech sector gained ground.
Although Australia's All Ordinaries opened higher, it lost ground in early trading and declined steadily until the afternoon. Thereafter, the average moved roughly sideways before ending down 38.90 points or 0.66 percent at 5,877.
Barring energy and material stocks, most sectors saw weakness in Australia, with consumer, financial, IT, real estate, telecom and utility stocks leading the slide.
China's Shanghai Composite Index experienced volatility throughout the session before ending down 51.40 points or 1.24 percent at 4,084. Meanwhile, Hong Kong's Hang Seng Index ended a volatile session up 57.33 points or 0.21 percent.
On the economic front, China's National Bureau of Statistics released a slew of reports that confirmed the soft patch in the world's second largest economy. First quarter GDP slowed to 7 percent year-over-year, a 6-year low. The growth was slower than the 7.3 percent increase in the fourth quarter of 2014 but was in line with estimates.
Chinese industrial production rose 5.6 percent year-over-year in March, slower than the 7 percent increase forecast by economists and the 7.9 percent growth in February. Retail sales growth of 10.2 percent was also weaker than the 10.9 percent growth widely expected. Fixed asset investment for the first three months of the year was up 13.5 percent, a touch soft than expectations.
Meanwhile, the results of a consumer confidence survey by Westpac showed that confidence among consumers in Australia receded in April. The consumer confidence index fell 3.2 percent to 96.2.
Revised estimate released by Japan's Ministry of Economy, Trade and Industry showed that industrial output fell 3.1 percent month-over-month in February compared to the 3.4 percent decline estimated initially. Annually, output was down 2 percent.
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| | Currency and Commodities Markets | | Crude oil futures are climbing $0.86 to $54.13 a barrel after rallying $1.38 to $53.29 a barrel on Tuesday. Meanwhile, an ounce of gold is trading at $1,192.50, down $0.10 from the previous session's close of $1,192.60. On Tuesday, gold declined $6.70.
On the currency front, the U.S. dollar is trading at 119.49 yen compared to the 119.40 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is valued at $1.0585 compared to yesterday's $1.0655
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