Market Overview (04.17.2017)
by Aaron.J | Hans.S | Yilin.Z
ContentsMarket Today
Indices
Currency
Commodities
Econ & Policy
Economic Indicators
Policy
Business News
Energy
Industrials
Consumers
Financials
Data Center
Equity
Bond
ETF Flow
Calendar
Economic Calendar
Market Today
S&P 500, Dow Jones, NASADQ: U.S. financial markets are closed for Eastern on Good Friday, April 14.
FTSE 100: European financial markets will also be closed on Good Friday, April 14 and Easter Monday, April 17
Nikkei 225 (+0.1% at 18,355) The yen has maintained a strong tone against major currencies which has undermined confidence in Japanese equities with underlying security issues also important in curbing buying support. Trading was light as tensions eased a bit on the Korean peninsula following North Korea's ballistic missile test. Nikkei edged higher by 0.1% amid speculation that recent selling was overdone.
US Dollar Index (DXY): The dollar dipped to a five-month low against the yen on Monday as rising tensions over North Korea kept the safe-haven Japanese currency in demand. The against a basket of major currencies was down 0.2 percent at 100.390 (), weighed down following the release of Friday's weak U.S. retail sales and consumer prices data and as flight-to-safety drove U.S. Treasury yields to five-month lows. (DXY: -0.41% at 100.15)
EUR/USD: is up 0.23% in today’s trading, trading near the 1.0626 level after reaching a high at 1.0651. Today’s range is expected to be narrow, given the Easter Monday holiday. However, the overall bias remains to the upside, as the Stochastic continues to move higher, but remains well below a fully overbought level. (EUR/USD: 0.42% at 1.0657)
Japan Yen: continues to move lower in today’s trading and is currently at 108.30, a loss of 0.25% from Friday’s close. The pair has been unable to produce any upside momentum in recent sessions, despite the fact the Stochastic remains at a fully oversold level. This is a sign of underlying weakness. (USD/JPY: -0.16% at 108.48)
British Pounds: has started off the week with a move to the upside and is currently trading at 1.2544, a gain of 0.18% over Friday’s close. As a result of the move to the upside, the upper boundary of the symmetrical triangle shown on the daily chart below is now back in play. A sustained move above this level is required to improve the broader outlook for the pair. (GBP/USD: 0.36% at 1.257)
Gold hit a five-month high on Monday as the dollar weakened with investors taking refuge in safe-haven assets in the wake of rising geopolitical tensions over North Korea. (Gold Prices: +0.2% at $1,288.42)
Oil: Crude futures prices fell Monday, giving back some recent gains as analysts pointed to signs of a continued uptick in U.S. output. (Brent Crude Futures: -
Econ & Policy
Europe
Empire State manufacturing activity 5.20 vs. 15.00 forecast from 16.40 in the preceding month. Despite the slide in the monthly index, forward-looking indexes were generally at high levels, pointing to widespread optimism about the future.
Asia and Pacific
Chinese fixed asset investment 9.2% vs. 8.8% forecast from 8.9% in the preceding month;
Chinese industrial production 7.6% vs. 6.3% forecast from 6.3% in the preceding month.
Chinese GDP 6.9% vs. 6.8% forecast from 6.8% in the preceding month. The Chinese economy expanded at a faster pace in the first quarter, as government spending continued to fuel the expansion that many had feared would begin to slow in the new year. The world’s second-largest economy is coming off a year of slower but more consistent growth fueled by government outlays and cheap credit.
Indonesian trade balance 1.23B vs. 1.20B forecast from 1.31B in the preceding month.
Indian WPI 5.70% vs. 5.98% forecast from 6.55% in the preceding month.
PolicyAmericas
The Trump administration said Friday it will nominate an outspoken critic of the Export-Import Bank to head the agency, just days after Pres. Trump appeared to reverse his position on the bank that the likes of GE and Boeing (NYSE:BA) say is vital to their success. Former Rep. Scott Garrett, who called the Ex-Im Bank a "fund for corporate welfare" and voted twice against reauthorizing the bank while in Congress, will be nominated as the bank’s president. Conservative Republicans have forced the Ex-Im Bank to remain mostly dormant for nearly two years through a lack of leadership, yet the appointment of Garnett and another former congressman to the bank's board could allow lending to resume in earnest.
Europe
Turkey's Erdogan wins expanded powers, sparks rally in Turkish lira: Turkish President Erdogan narrowly won a crucial referendum yesterday that will greatly expand the powers of his office and cement his hold on power. Voters approved a set of constitutional amendments that give Erdogan greater sway over policy, including the authority to appoint ministers and top judges at his discretion. The Turkish lira is up by 2%, as traders see the vote removing a major source of uncertainty following last summer's failed coup attempt, credit rating downgrades and the slumping lira.
Business News
BP Oil Leak: An out of control well in Alaska's Prudhoe Bay has stopped leaking oil but continues to spray natural gas, operator BP and state authorities say. Crews have been unable to fully shut down the well on Alaska’s North Slope, which was discovered on Friday; the amount of oil that had been released reportedly is "minor" compared with the volume of natural gas leaking from the well. BP's Prudhoe Bay operations account for ~55% of Alaska’s oil and gas production. The Trans-Alaska pipeline system, which runs from Prudhoe Bay south to Valdez, is not affected by the incident and is operating normally.
IndustrialsUnited Airlines (NYSE:UAL) is changing its policy on booking its own flight crews onto its planes following the recent fiasco in which a man was forcibly dragged off an overbooked flight to clear a seat for an airline employee. UAL says it will ensure that crews riding on its aircraft as passengers are booked at least 60 minutes before departure, avoiding the removal of passengers from their seats after already boarding the plane. Competing airlines are following with their own changes; Delta (NYSE:DAL) customer service agents are now authorized to dole out as much as $2,000 to a passenger who gives up a seat, while a high-level supervisor can pay out as much as $9,950 in some cases. Meanwhile, a couple on the way to their wedding this weekend claims they were kicked off their United flight.
ConsumersAmazon (NASDAQ:AMZN) might be interested in BJ's Wholesale: BJ's Wholesale Club is putting itself up for sale, and Amazon has expressed "modest internal interest," according to the NY Post. BJ's recently scrapped ambitions for an IPO because of Wall Street's growing worries over the retail sector, so CVC Capital Partners and Leonard Green & Partners, the buyout firms that took BJ’s private six years ago, are pressing ahead for an outright sale that could fetch more than $4B, according to the report. Buyout firms are expected to take a look, while AMZN is said to have also recently discussed evaluating BJ’s as an acquisition target, but the report says it is not known if the company actually would bid on the chain if it goes on the block.
Apple (NASDAQ:AAPL) has secured a permit for autonomous vehicle testing in California, joining a number of rivals, including Google (GOOG, GOOGL). Tesla (NASDAQ:TSLA), Uber (Private:UBER) and General Motors (NYSE:GM). The move shows Apple progressing beyond testing on private tracks and simulators, and it will open the firm's heavily secretive self-driving car effort (named Project Titan) up to more public scrutiny, as reports will now need to be filed with the state. For Google's part, its Waymo operation has driven more than 2.5M miles on public roads, including about 636K miles in California. It is also testing autonomous cars in Washington, Arizona and Texas.
FinancialsAnt Financial (NYSE:BABA) raised its offer for MoneyGram International (NYSE:MGI) to ~$1.2B, winning the backing of MGI's board as it beat out a rival offer from Euronet Worldwide (NASDAQ:EEFT). Ant, the finance affiliate of Alibaba, increased its bid to $18/share in cash from $13.25, and agreed to assume or refinance MGI's debt; EEFT last month offered $15.20/share for MGI. Ant could still face potential political obstacles, with U.S. lawmakers urging the Committee on Foreign Investment in the U.S. to conduct a full review of the deal.
Vanguard's exceptional growth: In the last three calendar years, investors sank $823B into Vanguard funds, in a scale that becomes clear when it is compared with the rest of the mutual fund industry - more than 4,000 firms in total. All of them combined took in just a net $97B during that period, Morningstar data shows. Vanguard, in other words, scooped up about 8.5x as much money as all of its competitors. Vanguard’s assets under management have skyrocketed to $4.2T from $1T seven years ago, according to the company, with ~$3T invested in passive index-based strategies and the rest in funds that rely on an active approach to picking stocks and bonds.
Data Center
Equity
S&P500
VIX
Bond
World Bond Yield Curve
Sovereign Debt Movement
Sovereign 5Y Debt CDS
U.S. Municiple Bond
U.S. Investment Grade Bond
U.S. High Yield Bond
U.S. Corporate Bond CDS
ETF Flow
Asset Class
Asset Class: Equity
Geography Regions
Geography Regions: Asia Pacific
Calendar
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Sources