Jun E-mini S&Ps (ESM17 -0.28%) this morning are down -0.28% at a 2-week low and European stocks are down -0.52%. Geopolitical concerns from North Korea, Syria and the French presidential elections have all increased uncertainty in global markets and pushed the VIX volatility index up to a 5-month high, which is weighing on stocks. Comments late Wednesday from President Trump have pushed the dollar index down to a 2-month low and the 10-year T-note yield down to a 4-3/4 month low when he said, “the dollar is too strong” and that he likes “a low interest rate policy.” The increase in volatility along with the weak dollar has bolstered demand for gold with Jun COMEX gold (GCM17 +0.88%) up +0.88% at a 5-month high. Trading activity was subdued ahead of the Easter holiday, where markets in the U.S. will be closed Friday and will be closed Friday and Monday in Europe. Asian stocks settled mixed: Japan -0.68%, Hong Kong -0.21%, China +0.07%, Taiwan +0.19%, Australia -0.74%, Singapore -0.53%, South Korea +1.05%, India -0.61%. China’s Shanghai Composite eked out a gain on signs of strength in the Chinese economy after China Mar exports and imports both rose more than expected. Japan’s Nikkei Stock Index tumbled to a 4-month low after a fall in USD/JPY to a 4-3/4 month low fueled a sell-off in exporter stocks as the stronger yen undercuts the earnings prospects of Japanese exporters.
The dollar index (DXY00 -0.45%) is down -0.44% at a 2-week low. EUR/USD (^EURUSD) is down -0.25%. USD/JPY (^USDJPY) is unch.
Jun 10-year T-note prices (ZNM17 +0.52%) are up +21.5 ticks at a 4-3/4 month high.
The China Mar trade balance was in surplus by +$ 23.93 billion, wider than expectations of +$ 12.5 billion. Mar exports jumped +22.3% y/y, stronger than expectations of +8.0% y/y and the largest increase in 2-years. Mar imports surged +26.3% y/y, stronger than expectations of +15.0% y/y.
Key U.S. news today includes: (1) weekly initial unemployment claims (expected +11,000 to 245,000, previous -25,000 to 234,000) and continuing claims (expected -4,000 to 2.024 million, previous -24,000 to 2.028 million), (2) Mar PPI final demand (expected unch m/m and +2.4% y/y, Feb +0.3% m/m and +2.2% y/y) and Mar core PPI (expected +0.2% m/m and +1.8% y/y, Feb +0.3% m/m and +1.5% y/y), (3) preliminary-Apr University of Michigan U.S. consumer sentiment index (expected -0.4 to 96.5, Mar +0.6 to 96.9), and (4) USDA weekly Export Sales. Friday is a market holiday but the federal government is open and reports include: (1) Mar CPI (expected unch m/m and +2.6% y/y, Feb +0.1% m/m and +2.7% y/y) and Mar core CPI (expected +0.2% m/m and +2.3% y/y, Feb +0.2% m/m and +2.2% y/y), (2) Mar retail sales (expected -0.2% and +0.1% ex autos, Feb +0.1% and +0.2% ex autos), and (3) Feb business inventories expected +0.3%, Jan +0.3%.
Notable Russell 1000 earnings reports today include: Citigroup (consensus $ 1.24), JPMorgan Chase (1.52), Wells Fargo (0.97), First Horizon National (0.23), First Republic Bank (1.01), PNC Financial (1.84), Commerce Bancshares (0.65).
U.S. IPO’s scheduled to price today: none.
Equity conferences: Next Generation Pharmaceutical Samples Conference on Wed-Thu.
JPMorgan Chase (JPM -0.38%) rose over 1% in pre-market trading after it reported Q1 adjusted EPS of $ 1.57, better than consensus of $ 1.52.
Abbott Laboratories (ABT -0.23%) lost over 1% in after-hours trading after it received a warning letter from the FDA who said that Abbott failed to provide evidence of corrections over faulty device batteries.
Wells Fargo (WFC -1.92%) dropped almost 1% in after-hours trading after Berkshire Hathaway said it sold 7.13 million shares of Wells Fargo this week and plans to divest an additional 1.87 million shares in the future to keep its stake in the bank below 10% to avoid Federal Reserve regulations.
Ultimate Software (ULTI -0.30%) was initiated with a ‘Buy’ rating at Guggenheim with a price target of $ 230.
Six Flags Entertainment (SIX -0.31%) was rated a new ‘Buy’ at SunTrust with a price target of $ 66.
Energen (EGN -2.05%) was resumed with a ‘Buy’ rating at Stifel with a price target of $ 80
Applied Optoelectronics (AAOI -3.68%) surged 18% in after-hours trading after it raised guidance for Q1 adjusted EPS to $ 1.00-$ 1.02 from a February 23 estimate of 80 cents-88 cents, well above consensus of 83 cents, citing “robust” demand for datacenter products.
Zendesk (ZEN -0.14%) was initiated with a ‘Buy’ rating at Guggenheim with a price target of $ 33.
Hanesbrands (HBI +1.25%) jumped 7% in after-hours trading after it reaffirmed 2017 financial guidance and announced the retirement of CFO Richard Moss at the end of the year.
Entellus Medical (ENTL -0.44%) rose 4% in after-hours trading after it was granted 510k clearance from the FDA for use of its XprESS ENT dilation system in patients with persistent Eustachian tube dysfunction.
Pier 1 Imports (PIR -0.14%) slid over 3% in after-hours trading after it said it sees a Q1 adjusted loss per share of -3 cents to -7 cents, a wider loss than consensus of -2 cents.
Adecoagro (AGRO -0.17%) fell nearly 2% in after-hours trading after a 9.3 million block of shares was offered at $ 11.40-$ 11.50 via Morgan Stanley, a person familiar with the process said.
Sorrento Therapeutics (SRNE unch) plunged over 20% in after-hours trading after it announced that it intends to offer shares of its common stock in an underwritten public offering, although no size was given.
Jun E-mini S&Ps (ESM17 -0.28%) this morning are down -6.50 points (-0.28%) at a 2-week low. Wednesday’s closes: S&P 500 -0.38%, Dow Jones -0.29%, Nasdaq -0.40%. The S&P 500 on Wednesday closed lower on geopolitical concerns about Syria, France and North Korea that sent the VIX volatility index to 5-month high and fueled long liquidation pressure in stocks. There was also weakness in mining stocks and commodity producers after copper prices fell -2.42% to a 3-month low. Stocks found support from Dallas Fed President Kaplan’s comment that the U.S. is moving toward full employment and that he sees U.S. GDP growth “in excess” of 2% this year.
Jun 10-year T-notes (ZNM17 +0.52%) this morning are up +21.5 ticks at a 4-3/4 month high. Wednesday’s closes: TYM7 -0.50, FVM7 +0.50. Jun 10-year T-notes on Wednesday closed little changed. T-notes received a boost from dovish comments from Dallas Fed President Kaplan who said the U.S. economy “isn’t running away” so the Fed “ought to be gradual and patient’ on monetary policy. T-notes were also boosted by President Trump’s comment that he “likes” and “respects” Fed Chair Yellen and is leaving open the possibility or reappointing her when her Chair term expires next year.
The dollar index (DXY00 -0.45%) this morning is down -0.44 (-0.44%) at a 2-week low. EUR/USD (^EURUSD) is down -0.0027 (-0.25%) and USD/JPY (^USDJPY) is unch. Wednesday’s closes: Dollar index -0.58 (-0.58%), EUR/USD +0.0060 (+0.57%), USD/JPY -0.59 (-0.54%). The dollar index on Wednesday fell to a 2-week low and closed lower on comments from Dallas Fed President Kaplan who said the Fed “ought to be gradual and patient’ on monetary policy and on President Trump’s comment that he would prefer the Fed keep interest rates low and that the dollar “is getting too strong.” In addition, USD/JPY slumped to a 4-3/4 month low as geopolitical uncertainty fueled safe-haven demand for the yen.
May WTI crude oil prices (CLK17 +0.04%) this morning are unch and May gasoline (RBK17 -0.22%) is -0.0043 (-0.25%). Wednesday’s closes: May crude -0.29 (-0.54%), May gasoline -0.0160 (-0.91%). May crude oil and gasoline on Wednesday closed lower on the +0.4% increase in U.S. crude production in the week ended Apr 7 to a 1-1/4 year high of 9.235 million bpd and on the +275,000 bbl increase in crude supplies at Cushing, OK, delivery point of WTI crude futures, to a record high 69.42 million bbl. Crude oil prices received a boost from the -2.17 million bbl decline in EIA crude inventories (vs expectations of -1.5 million bbl) and the -2.97 million bbl decline in EIA gasoline stockpiles (vs expectations of -1.0 million bbl).
|Thursday, April 13|
|US||0830 ET||Weekly initial unemployment claims expected +11,000 to 245,000, previous -25,000 to 234,000. Weekly continuing claims expected -4,000 to 2.024 million, previous -24,000 to 2.028 million.|
|0830 ET||Mar PPI final demand expected unch m/m and +2.4% y/y, Feb +0.3% m/m and +2.2% y/y. Mar PPI ex food & energy expected +0.2% m/m and +1.8% y/y, Feb +0.3% m/m and +1.5% y/y.|
|0830 ET||USDA weekly Export Sales.|
|1000 ET||Preliminary-Apr University of Michigan U.S. consumer sentiment index expected -0.4 to 96.5, Mar +0.6 to 96.9.|
|1100 ET||Treasury announces amount of 5-year TIPS to be auctioned Apr 20 (previous $ 14 billion)|
|Friday, April 14|
|US||n/a||Markets closed for Good Friday but Federal Reserve and government offices open.|
|0830 ET||Mar CPI expected unch m/m and +2.6% y/y, Feb +0.1% m/m and +2.7% y/y. Mar CPI ex food & energy expected +0.2% m/m and +2.3% y/y, Feb +0.2% m/m and +2.2% y/y.|
|0830 ET||Mar retail sales expected -0.2% and +0.1% ex autos, Feb +0.1% and +0.2% ex autos.|
|1000 ET||Feb business inventories expected +0.3%, Jan +0.3%.|
|First Horizon National Corp||FHN US||Bef-mkt||Q1 2017 Earnings Release||Q1 17||0.231|
|First Republic Bank/CA||FRC US||Bef-mkt||Q1 2017 Earnings Release||Q1 17||1.012|
|PNC Financial Services Group Inc/The||PNC US||06:30||Q1 2017 Earnings Release||Q1 17||1.835|
|JPMorgan Chase & Co||JPM US||06:45||Q1 2017 Earnings Release||Q1 17||1.517|
|Commerce Bancshares Inc/MO||CBSH US||07:00||Q1 2017 Earnings Release||Q1 17||0.65|
|Wells Fargo & Co||WFC US||08:00||Q1 2017 Earnings Release||Q1 17||0.965|
|Citigroup Inc||C US||08:00||Q1 2017 Earnings Release||Q1 17||1.241|
|JPMorgan Chase & Co||JPM US||08:30||Q1 2017 Earnings Call||Q1 17|
|First Horizon National Corp||FHN US||09:30||Q1 2017 Earnings Call||Q1 17|
|PNC Financial Services Group Inc/The||PNC US||09:30||Q1 2017 Earnings Call||Q1 17|
|Wells Fargo & Co||WFC US||10:00||Q1 2017 Earnings Call||Q1 17|
|First Republic Bank/CA||FRC US||10:00||Q1 2017 Earnings Call||Q1 17|
|Citigroup Inc||C US||11:30||Q1 2017 Earnings Call||Q1 17|
|Exxon Mobil Corp||XOM US||Annual General Meeting of Shareholders|
|AO Smith Corp||AOS US||Annual General Meeting|