Today’s Big Picture
Asia-Pacific equity markets finished the day ahead except for Japan’s Nikkei, which declined 0.36%. South Korea’s KOSPI advanced 0.38%, Taiwan’s TAIEX gained 0.51%, Hong Kong’s Hang Seng rose 0.58%, and China’s Shanghai Composite closed up 0.65%. Australia’s ASX All Ordinaries ended the day 1.06% higher on a broad rally led by Electronic Technology names. India’s markets are closed today as the country celebrates Ram Navami, the birthday of Rama, the seventh avatar of the deity Vishnu. European markets are up across the board in midday trading except for Hungary and U.S. futures point to a healthy open.
Stocks are looking to build on yesterday’s gains, fueled in part by reports the White House will look to toughen standards for mid-sized banks, a move that should add to the growing confidence the worst of the recent bank crisis is in the rearview mirror. We continue to think, however, that as that happens, the market’s focus will soon turn back to inflation and the Fed’s efforts to return it to its stated 2% target. Given the disparity between the Fed’s year-end 5.1% fed funds rate target and fed fund futures that still have multiple rate cuts priced into the curve, we see the market focusing on today’s comments from Boston Federal Reserve President Susan Collins, Richmond Fed President Thomas Barkin, and Minneapolis Fed President Neel Kashkari. Should that group of Fed heads reiterate the Fed playbook laid out by Fed Chair Powell following the Fed’s most recent monetary policy meeting, the market’s opening strength may fade toward today’s session close.
Data Download
International Economy
Speaking at an international business summit in Hainan, China’s Premier Li Qiang shared China is committed to opening up the world’s second-largest economy and delivering reforms that can help stimulate growth.
The economic sentiment indicator in the Euro Area fell to 99.3 in March, down from a revised 99.6 for the previous month and slightly below market expectations of 99.8. The March figure was the second consecutive month of decline in confidence. The consumer confidence indicator in the Euro Area edged down by 0.1 points to -19.2 in March, remaining near the highest level in more than a year and in line with preliminary estimates. The consumer inflation expectations index in the Euro Area rose to 18.9 in March, up from February’s two-year low of 17.7.
UK car production rose 13.1% YoY to 69,707 units in February, reversing from a 0.3% drop in January as volumes for both domestic and overseas markets increased.
At 8 AM ET, the preliminary reading for inflation in Germany will be released and it is expected to fall to 7.3% YoY vs. 8.7% for both January and February.
Domestic Economy
If it is Thursday then that means the latest metrics for weekly initial and continuing jobless claims will be published as will the Energy Information Administration’s latest take on natural gas inventories. In addition, at 8:30 AM ET the third and final revision for 4Q 2022 GDP will be released. That report will also include the last look at the PCE Price Index for 4Q 2022, which was last thought to have risen 4.3% YoY.
The Wall Street Journal is reporting the White House is planning as soon as this week to recommend tougher rules for midsize banks.
Markets
With banking woes seemingly settled for now, traders took cues from a resilient consumer confidence number as well as strong earnings reports from Micron (MU) and lululemon (LULU) to bid up equities. The Dow rose 1.00%, the Russell 1000 gained 1.08%, the S&P 500 added 1.42% and the Nasdaq Composite closed 1.79% higher. Sectors were all positive with Real Estate (2.38%) and Technology (2.10%) leading the way. Relative laggards included Consumer Staples (0.56%) and Healthcare (0.28%). Consumer Discretionary names Amazon (AMZN) and Tesla (TSLA) rose 3.10% and 2.48%, respectively to collectively contribute to just over half of the sector’s 1.90% gain yesterday.
Here’s how the major market indicators stack up year-to-date:
- Dow Jones Industrial Average: -1.30%
- S&P 500: 4.90%
- Nasdaq Composite: 13.95%
- Russell 2000: 0.59%
- Bitcoin (BTC-USD): 71.03%
- Ether (ETH-USD): 49.76%
Stocks to Watch
Before U.S. equity markets begin trading today, AngioDynamics (ANGO) and EVgo (EVGO) are expected to report their quarterly results
Apple (AAPL) announced its WWDC23 conference would be held June 5-June 9, which means we can expect speculation about what the company will debut to run wild.
The Financial Times reports Meta (META) executives are discussing a company-wide ban on political advertising in Europe, following concerns that its social networking platforms such as Facebook and Instagram will be unable to comply with forthcoming EU regulations that target online campaigning.
Toyota Motor (TM) announced its February worldwide sales fell 10.3% YoY to 773,271 units.
CNH Industrial (CNHI) has agreed to acquire Hemisphere GNSS from Unistrong for ~$175 million, free of cash and debt. Hemisphere GNSS specializes in precision global positioning systems and global navigation satellite system products and technology for positioning, heading, guidance, navigation, machine control, and L-band correction service applications.
Mastercard (MA) and Visa (V) are among the suitors in talks to buy Brazilian cloud-native core banking and payments platform Pismo for around $1 billion.
Electronic Arts (EA) has approved a restructuring plan that includes cutting its headcount by approximately 6%.
Crane (CR) will be added to the S&P MidCap 400 before the market opens on April 4, replacing PacWest Bancorp (PACW) which will be moved to the S&P SmallCap 600 effective before trading begins on April 5. PacWest Bancorp is replacing Nektar Therapeutics (NKTR) because the index committee at S&P Global has decided to make the swap, citing Nektar as being “no longer representative of the small-cap space.”
IPOs
Near-term the calendar for such activity looks relatively thin. Readers looking to dig more into the upcoming IPO calendar should visit Nasdaq’s Latest & Upcoming IPOs page.
After Today’s Market Close
Blackberry (BB), Duck Creek Technologies (DCT), and Yamana Gold (AUY) 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
Friday, March 31
- Japan: Tokyo Core CPI – March
- Japan: Industrial Production, Retail Sales – February
- China: Manufacturing and Non-Manufacturing PMIs – March
- Eurozone: Consumer Price Index – March
- US: Personal Income & Spending, PCE Price Index – February
- US: University of Michigan Consumer Sentiment Index – March
Thought for the Day
“When you can laugh at yourself no one can ever make a fool of you.” ~ Joan Rivers
Disclosures
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
