Jun E-mini S&Ps (ESM17 -0.12%) this morning are trading mildly lower on a -2% overnight sell-off in Apple on disappointing quarterly earnings results as iPhone sales are being slowed as people wait for upgrades on new versions. The markets are waiting for outcome of today’s FOMC meeting, which is expected to produce unchanged rates. European stocks are little changed this morning as the markets await today’s French presidential debate between centrist Emmanuel Macron and far-right Marine Le Pen in the home stretch to Sunday’s French presidential election. Today’s Eurozone Q1 GDP report of +0.5% q/q and +1.7% y/y was in line with market expectations but was strong compared with U.S. Q1 growth of +0.7% (q/q annualized) and was supportive for the euro and European stocks. The UK FTSE is down -0.31% this morning as the markets worry that Brexit negotiations are getting off on the wrong foot with tension between UK Prime Minister May and EU officials after reports of a frosty dinner meeting earlier this week where Ms. May said that the UK would refuse to pay any exit fee versus EU demands for 100 billion euros.
China’s Shanghai Composite index today fell by another -0.27% on continued concern about the government’s crackdown on leverage and improper trading. However, the Chinese government is making an effort to reassure investors and calm market nerves. The Chinese central bank today injected a large amount of daily liquidity to calm nerves. A news service run by the Chinese central bank urged investors not to overreact to tougher regulations in a front-page article. The Japanese and Hong Kong markets were closed today for holidays. Other Asian stock markets today were mixed: Taiwan +0.14%, Australia -0.98%, Singapore +0.83%, India -0.09%, Turkey -0.08%.
Key U.S. news today includes: (1) weekly MBA mortgage applications (previous +2.7% with purchase sub-index -1.0% and refi sub-index +7.2%), (2) Apr ADP employment (expected +178,000, Mar +263,000), (3) final-Apr Markit services PMI (expected unrevised at 52.5, prelim-Apr -0.3 to 52.5), (4) Apr ISM non-manufacturing PMI (expected +0.6 to 55.8, Mar -2.4 to 55.2), (5) 2-day FOMC meeting concludes with policy announcement, (6) EIA Weekly Petroleum Status Report.
Notable S&P 500 earnings reports today include: Facebook (consensus $ 1.12), Time-Warner (1.46), ADP (1.23), Excelon (0.62), Delphia Automotive (1.46), Garmin (0.45), Humana (2.75), Estee Lauder (0.73), Yum Brands (0.60), Southern Co (0.60), ICE (0.73), Molson Coors (1.29), Prudential Financial (2.64), Lincoln National (1.61), Kraft Heinz (0.85), AIG (1.05), Murphy Oil (-0.01), Williams Cos (0.21), Metlife (1.28), Level 3 Communications (0.33).
U.S. IPO’s scheduled to price today: Liberty Oilfield Services (BDFC), Antero Resources Midstream Management (AMGP), Biohaven Pharmaceutical (BHVN), UroGen Pharma (URGN).
Equity conferences: Deutsche Bank Health Care Conference on Wed-Thu, Macquarie Group Ltd Business Services Conference on Thu.
Apple (AAPL +0.63%) fell -2.3% in after-hours trading after saying that it is selling fewer phones because consumers are waiting for upgrades on newer models.
Weight Watchers (WTW -0.56%) rallied 13% in after-hours trading after boosting its annual EPS guidance.
FireEye (FEYE -2.16%) rallied 12% in after-hours trading after saying that it expects to be profitable by the end of this year.
First Solar (FSLR +2.61%) rallied 6% in after-hours trading after raising its 2017 guidance, which gave other solar stocks a boost as well.
Mondelez (MDLZ -0.73%)rallied more than 2% in after-hours trading after reporting above-consensus Q1 EPS.
Twilio (TWLO -1.31%) plunged nearly 30% in after-hours trading after cutting its annual revenue guidance.
Akamai Technologies (AKAM +1.66%) fell more than 10% in after-hours trading after its Q2 guidance missed estimates.
Etsy (ETSY +2.98%) fell -10% in after-hours trading after missing Q1 revenue and announcing that its CEO will step down.
Jun E-mini S&Ps this morning are trading mildly lower due to overnight weakness in Apple and some concern about the outcome of today’s FOMC meeting. Tuesday’s closes: S&P 500 +0.12%, Dow Jones +0.17%, Nasdaq +0.06%. The S&P 500 on Tuesday closed slightly higher on the -3.8 bp drop in the 10-year T-note yield to 2.280% and on continued support from positive Q1 earnings reports. Stocks were undercut by the much weaker-than-expected U.S. vehicles sales report, which caused a plunge in auto stocks (Ford -4.4%, GM -2.9%). Stocks were also undercut by the -2.42% sell-off in June crude oil prices which undercut oil stocks.
Jun 10-year T-note prices this morning are unchanged as the market waits for the FOMC meeting outcome and the Treasury’s quarterly funding announcement. Tuesday’s closes: TYM7 +7.50, FVM7 +5.50. Jun 10-year T-notes on Tuesday closed higher on the -2.42% sell-off June crude oil prices, which caused a -3.3 bp drop in the U.S. 10-year breakeven inflation expectations rate to 1.89%, and on the weak U.S. April vehicle sales report.
The dollar index is mildly higher this morning by +0.117 points (+0.12%), while EUR/USD is down -0.0019 (-0.17%) and USD/JPY is up +0.20 (+0.18%). Tuesday’s closes: Dollar index -0.101 (-0.10%), EUR/USD +0.0031 (+0.28%), USD/JPY +0.15 (+0.13%). The dollar index on Tuesday closed slightly lower on the weak U.S. vehicle sales report, which kept U.S. consumer spending in a weak light. The yen fell to a new 1-month low against the dollar on reduced safe-haven demand for the yen with global stock market strength and reduced concerns about Sunday’s French presidential election.
June WTI crude oil prices are up +0.48 (+1.01%) on a partial snap-back after Tuesday’s sharp losses. June gasoline is up +0.0304 (+1.09%). Tuesday’s closes: Jun crude -1.18 (-2.42%), Jun gasoline -0.0136 (-0.89%). June crude oil prices on Tuesday closed sharply lower on expectations for a rise in U.S. product inventories in Wednesday’s EIA report as the surplus simply moves from crude oil to products. Crude oil prices were also undercut by a larger than expected narrowing of Saudi Arabia’s government budget deficit due to improved non-oil income, which means less pressure on Saudi Arabia to support oil prices. Oil prices were boosted by news that Russian April crude oil output fell by -0.5% to an average of 10.995 million bpd, which is -252,000 bpd below the Oct level but less than the promised -300,000 bpd cut.
|Wednesday, May 3|
|US||0700 ET||Weekly MBA mortgage applications, previous +2.7% with purchase sub-index -1.0% and refi sub-index +7.2%.|
|0815 ET||Apr ADP employment change expected +178,000, Mar +263,000.|
|0830 ET||Treasury announces amount of 3-year T-notes (previous $ 24 billion), 10-year T-notes (previous $ 20 billion) and 30-year T-bonds (previous $ 12 billion) to be auctioned May 9-11 in the May quarterly refunding.|
|0945 ET||Revised Apr Markit services PMI expected unrevised at 52.5, prelim-Apr -0.3 to 52.5. Revised Apr Markit composite PMI, Mar -0.3 to 52.7.|
|1000 ET||Apr ISM non-manufacturing PMI expected +0.6 to 55.8, Mar -2.4 to 55.2.|
|1030 ET||EIA Weekly Petroleum Status Report.|
|1400 ET||FOMC announces interest rate decision; fed funds target range expected unchanged at 0.75%-1.00%.|
|Thursday, May 4|
|US||0730 ET||Apr Challenger job cuts, Mar -2.0% y/y.|
|0830 ET||Weekly initial unemployment claims expected -8,000 to 249,000, previous +14,000 to 257,000. Weekly continuing claims expected +2,000 to 1.990 million, previous +10,000 to 1.988 million.|
|0830 ET||Mar trade balance expected -$ 44.5 billion, Feb -$ 43.6 billion.|
|0830 ET||Q1 non-farm productivity expected unch, Q4 +1.3%. Q1 unit labor costs expected +2.7%, Q4 +1.7%.|
|0830 ET||USDA weekly Export Sales.|
|1000 ET||Mar factory orders expected +0.4%, Feb +1.0% and +0.4% ex transportation.|
|Automatic Data Processing Inc||ADP US||Bef-mkt||Q3 2017 Earnings Release||Q3 17||1.229|
|Time Warner Inc||TWX US||Bef-mkt||Q1 2017 Earnings Release||Q1 17||1.456|
|NiSource Inc||NI US||Bef-mkt||Q1 2017 Earnings Release||Q1 17||0.673|
|Reynolds American Inc||RAI US||Bef-mkt||Q1 2017 Earnings Release||Q1 17||0.568|
|Exelon Corp||EXC US||Bef-mkt||Q1 2017 Earnings Release||Q1 17||0.618|
|Delphi Automotive PLC||DLPH US||Bef-mkt||Q1 2017 Earnings Release||Q1 17||1.458|
|Garmin Ltd||GRMN US||Bef-mkt||Q1 2017 Earnings Release||Q1 17||0.453|
|Clorox Co/The||CLX US||6:30||Q3 2017 Earnings Release||Q3 17||1.297|
|Harris Corp||HRS US||6:30||Q3 2017 Earnings Release||Q3 17||1.299|
|Humana Inc||HUM US||6:30||Q1 2017 Earnings Release||Q1 17||2.75|
|Estee Lauder Cos Inc/The||EL US||6:45||Q3 2017 Earnings Release||Q3 17||0.729|
|Yum! Brands Inc||YUM US||7:00||Q1 2017 Earnings Release||Q1 17||0.601|
|Southern Co/The||SO US||7:30||Q1 2017 Earnings Release||Q1 17||0.599|
|Intercontinental Exchange Inc||ICE US||7:30||Q1 2017 Earnings Release||Q1 17||0.734|
|Molson Coors Brewing Co||TAP US||8:00||Q1 2017 Earnings Release||Q1 17||1.287|
|Assurant Inc||AIZ US||8:00||Q1 2017 Earnings Call||Q1 17|
|Yum! Brands Inc||YUM US||8:15||Q1 2017 Earnings Call||Q1 17|
|Automatic Data Processing Inc||ADP US||8:30||Q3 2017 Earnings Call||Q3 17|
|Time Warner Inc||TWX US||8:30||Q1 2017 Earnings Call||Q1 17|
|Harris Corp||HRS US||8:30||Q3 2017 Earnings Call||Q3 17|
|Verisk Analytics Inc||VRSK US||8:30||Q1 2017 Earnings Call||Q1 17|
|PulteGroup Inc||PHM US||8:30||Annual General Meeting|
|Intercontinental Exchange Inc||ICE US||8:30||Q1 2017 Earnings Call||Q1 17|
|Delphi Automotive PLC||DLPH US||8:30||Q1 2017 Earnings Call||Q1 17|
|NiSource Inc||NI US||9:00||Q1 2017 Earnings Call||Q1 17|
|Allstate Corp/The||ALL US||9:00||Q1 2017 Earnings Call||Q1 17|
|Anadarko Petroleum Corp||APC US||9:00||Q1 2017 Earnings Call||Q1 17|
|General Dynamics Corp||GD US||9:00||Annual General Meeting|
|Humana Inc||HUM US||9:00||Q1 2017 Earnings Call||Q1 17|
|PepsiCo Inc||PEP US||9:00||Annual General Meeting|
|FMC Corp||FMC US||9:00||Q1 2017 Earnings Call||Q1 17|
|Philip Morris International Inc||PM US||9:00||Annual General Meeting|
|Global Payments Inc||GPN US||9:30||Annual General Meeting|
|Estee Lauder Cos Inc/The||EL US||9:30||Q3 2017 Earnings Call||Q3 17|
|Hershey Co/The||HSY US||10:00||Annual General Meeting|
|Phillips 66||PSX US||10:00||Annual General Meeting|
|CH Robinson Worldwide Inc||CHRW US||10:00||Analyst and Investor Day|
|Garmin Ltd||GRMN US||10:30||Q1 2017 Earnings Call||Q1 17|
|Molson Coors Brewing Co||TAP US||11:00||Q1 2017 Earnings Call||Q1 17|
|Newfield Exploration Co||NFX US||11:00||Q1 2017 Earnings Call||Q1 17|
|Devon Energy Corp||DVN US||11:00||Q1 2017 Earnings Call||Q1 17|
|Valero Energy Corp||VLO US||11:00||Annual General Meeting|
|Exelon Corp||EXC US||11:00||Q1 2017 Earnings Call||Q1 17|
|ONEOK Inc||OKE US||11:00||Q1 2017 Earnings Call||Q1 17|
|Federal Realty Investment Trust||FRT US||Annual General Meeting|
|Cabot Oil & Gas Corp||COG US||Annual General Meeting|
|Eversource Energy||ES US||Annual General Meeting|
|International Flavors & Fragrances Inc||IFF US||Annual General Meeting|
|Molson Coors Brewing Co||TAP US||13:00||Q1 2017 Earnings Call – Follow Up Session||Q1 17|
|Southern Co/The||SO US||13:00||Q1 2017 Earnings Call||Q1 17|
|IDEXX Laboratories Inc||IDXX US||13:00||Annual General Meeting|
|Clorox Co/The||CLX US||13:30||Q3 2017 Earnings Call||Q3 17|
|Stryker Corp||SYK US||14:00||Annual General Meeting|
|Prudential Financial Inc||PRU US||Aft-mkt||Q1 2017 Earnings Release||Q1 17||2.64|
|Concho Resources Inc||CXO US||Aft-mkt||Q1 2017 Earnings Release||Q1 17||0.286|
|Lincoln National Corp||LNC US||Aft-mkt||Q1 2017 Earnings Release||Q1 17||1.614|
|CenturyLink Inc||CTL US||Aft-mkt||Q1 2017 Earnings Release||Q1 17||0.532|
|Kraft Heinz Co/The||KHC US||Aft-mkt||Q1 2017 Earnings Release||Q1 17||0.853|
|American International Group Inc||AIG US||Aft-mkt||Q1 2017 Earnings Release||Q1 17||1.048|
|Murphy Oil Corp||MUR US||Aft-mkt||Q1 2017 Earnings Release||Q1 17||-0.012|
|Albemarle Corp||ALB US||Aft-mkt||Q1 2017 Earnings Release||Q1 17||0.956|
|Williams Cos Inc/The||WMB US||Aft-mkt||Q1 2017 Earnings Release||Q1 17||0.205|
|MetLife Inc||MET US||Aft-mkt||Q1 2017 Earnings Release||Q1 17||1.275|
|CF Industries Holdings Inc||CF US||Aft-mkt||Q1 2017 Earnings Release||Q1 17||-0.002|
|Federal Realty Investment Trust||FRT US||Aft-mkt||Q1 2017 Earnings Release||Q1 17||1.429|
|Alliant Energy Corp||LNT US||Aft-mkt||Q1 2017 Earnings Release||Q1 17||0.436|
|Facebook Inc||FB US||16:00||Q1 2017 Earnings Release||Q1 17||1.118|
|American Water Works Co Inc||AWK US||Aft-mkt||Q1 2017 Earnings Release||Q1 17||0.525|
|Qorvo Inc||QRVO US||16:00||Q4 2017 Earnings Release||Q4 17||0.809|
|Transocean Ltd||RIG US||Aft-mkt||Q1 2017 Earnings Release||Q1 17||-0.086|
|Pioneer Natural Resources Co||PXD US||Aft-mkt||Q1 2017 Earnings Release||Q1 17||0.165|
|Level 3 Communications Inc||LVLT US||16:15||Q1 2017 Earnings Release||Q1 17||0.326|
|CenturyLink Inc||CTL US||16:30||Q1 2017 Earnings Call||Q1 17|
|Prologis Inc||PLD US||16:30||Annual General Meeting|
|Kraft Heinz Co/The||KHC US||17:00||Q1 2017 Earnings Call||Q1 17|
|Facebook Inc||FB US||17:00||Q1 2017 Earnings Call||Q1 17|
|Qorvo Inc||QRVO US||17:00||Q4 2017 Earnings Call||Q4 17|
|Level 3 Communications Inc||LVLT US||17:30||Q1 2017 Earnings Call||Q1 17|