Today’s Big Picture
Asia-Pacific equity markets finished the day up except for Hong Kong’s Hang Seng, which fell 0.66%, led by Consumer Durables. Australia’s ASX All Ordinaries gained 0.20%, Japan’s Nikkei and South Korea’s KOSPI both advanced just over 0.30% and China’s Shanghai Composite rose 0.49%. India’s markets are closed today in recognition of the Jain holiday of Mahavir Jayanti which celebrates the birth of Mahavir Janma Kalyanak. Taiwan’s markets are again closed marking Children’s Day.
European markets are up across the board in midday trading. U.S. equity futures point to a positive open as investors re-consider the impact of higher oil prices on the economy and implications for Fed monetary policy. Yesterday, Fed Governor Lisa Cook said the disinflationary process is underway as wage gains are moderating, even though prevailing inflationary pressures will warrant further tightening. As the market looks for the end of the current tightening rate cycle, investors will be looking for confirmation of softening wage pressures in tomorrow’s March ADP National Employment and Pay Insights Report as well as Friday’s March Employment Report.
Data Download
International Economy
The Reserve Bank of Australia decided to leave the cash rate target unchanged at 3.60% and the interest rate on Exchange Settlement balances unchanged at 3.50%. The Board made the decision to hold interest rates steady this month to provide additional time to assess the impact of the increase in interest rates to date and the economic outlook.
Producer prices in the Euro Area dropped by 0.5% from a month earlier in February, more than the market expectations for a 0.3% decrease. However, excluding energy, producer prices rose 0.2% MoM in February, easing from a 1.1% advance in January. On a YoY basis, February producer price inflation eased to 13.2%, down from a revised 15.1% in January and slightly below market expectations for 13.3%.
According to the latest European Central Bank survey, Eurozone consumers cut inflation expectations from 4.9% in January to 4.6% in February.
Domestic Economy
At 10 AM ET, we’ll get February Factory Orders and the JOLTs Job Openings Report also for February. Factory orders are expected to contract by 0.5% in February following January’s 1.6% decline. February Job Openings are expected to fall to 10.4 million, down from 10.824 million the month before. Whether these expectations, if realized, are enough to offset any energy related inflation impact has yet to be seen but is something that will be heavily scrutinized.
Markets
Unsurprisingly, Energy ruled the day yesterday, rising 4.53% as the next largest sector gain was from Healthcare, which rose 1.12%. The remaining sectors were mixed with the largest drag coming from Consumer Discretionary (-0.92%) and Real Estate (-0.94%). Indexes were mixed as well, with the Dow (0.98%) and the S&P 500 (0.37%) closing ahead, the Russell 2000 ending the day flat, down 0.01%, and the Nasdaq Composite declining 0.27% to start the week. In individual names, PPG Industries (PPG) gained 4.84% after the company increased its EPS guidance for the current quarter and saw Morgan Stanley analysts raise its target price roughly 17% to $140.
Here’s how the major market indicators stack up year-to-date:
- Dow Jones Industrial Average: 1.37%
- S&P 500: 7.42%
- Nasdaq Composite: 16.46%
- Russell 2000: 2.33%
- Bitcoin (BTC-USD): 67.75%
- Ether (ETH-USD): 51.33%
Stocks to Watch
Before U.S. equity markets begin trading today, Acuity Brands (AYI), Lindsay Corp. (LNN), and MSC Industrial (MSM) are expected to report their quarterly results.
In his annual letter to shareholders, JPMorgan Chase (JPM) CEO Jamie Dimon commented the repercussions from recent bank failures will be felt for years to come, but recent events were “nothing like what occurred during the 2008 global financial crisis (which barely affected regional banks).”
Data released by China’s China Passenger Car Association showed Tesla (TSLA) sold 88,869 China-made electric vehicles (EV) in March, up 35% YoY and 19.4% MoM. The same data showed that Chinese automaker BYD (BYDDF) led all brands in March China EV sales with 206,089 EVs, up 97.5% Y/Y.
Butterfly Network (BFLY) received 510(k) clearance for a groundbreaking AI-enabled Auto B-line Counter that may simplify how healthcare professionals evaluate adults with suspected diminished lung function and can potentially accelerate their ability to make informed treatment decisions at the point of care.
Outdoor recreation and shooting sports product company Vista Outdoor (VSTO) announced a cost reduction and earnings improvement program that is expected to span more than $50 million and include office closures, spending cuts, and headcount reductions.
American Airlines (AAL) will cut some New York City flights this summer after the FAA temporarily relaxed some minimum flight requirements. Last month, the FAA agreed to requests of Delta Air Lines (DAL) and United Airlines (UAL) to temporarily return up to 10% of slots and flight timings at congested New York LaGuardia and John F. Kennedy International Airport, Newark, and Ronald Reagan Washington National Airport, citing air traffic controller shortages.
Walmart (WMT) plans to cut over 2,000 jobs in e-commerce warehouses.
Reports indicate Warner Bros. (WBD) is closing in on a deal with author J.K. Rowling that would result in a TV series based on the best-selling Harry Potter franchise to HBO Max
IPOs
Near-term the calendar for such activity looks rather thin. Readers looking to dig more into the upcoming IPO calendar should visit Nasdaq’s Latest & Upcoming IPOs page.
After Today’s Market Close
Resources Connection (RGP) and SMART Global (SGH) are slated to report their quarterly results after equities stop trading. Those looking for more on which companies are reporting when should head on over to Nasdaq’s Earnings Calendar.
On the Horizon
Wednesday, April 5
- Japan: Nikkei S&P Global Services PMI – March
- Eurozone: S&P Global Services PMI – March
- UK: S&P Global Services PMI – March
- US: Weekly MBA Mortgage Applications
- US: ADP Employment Change Report – March
- US: S&P Global Services PMI – March
- US: ISM Non-manufacturing Index – March
- US: Weekly EIA Crude Oil Inventories
Thursday, April 6
- China: Caixin Services PMI – March
- US: Weekly Initial & Continuing Jobless Claims
- US: Weekly EIA Natural Gas Inventories
Friday, April 7
- US: Employment Report – March
- US: Consumer Credit – February
Thought for the Day
“Without ambition one starts nothing. Without work, one finishes nothing. The prize will not be sent to you. You have to win it.” ~ Ralph Waldo Emerson
Disclosures
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
