Market Overview (04.24.2017)
by Aaron.J | Hans.S | Yilin.Z
ContentsMarket Today
Indices
Currency
Commodities
Econ & Policy
Economic Indicators
Policy
Business News
Industrials
Consumers
Health Care
Financials
Information Tech
Data Center
Equity
Bond
ETF Flow
Calendar
Economic Calendar
Market Today
S&P 500 (-0.3% at 2,349) Dow Jones (-0.2% at 20,548) NASDAQ (-0.1% at 5,911) U.S. stocks declined Friday, as tumbling oil prices and worries over the upcoming French election dampened investors’ enthusiasm.
FTSE 100 (+1.8% at 7,241) U.K. shares rallied on Monday, with banks leading the charge, after centrist Emmanuel Macron won the first voting round of France's presidential election, helping reduce the risks of political instability in the euro zone.
Nikkei 225 (+1.4% at 18.876) Risk appetite improved following the French Presidential election result with gains for equities and a weaker yen helping to support the Nikkei index, although there were still concerns surrounding North Korean tensions.
US Dollar Index (DXY): The (DXY) gapped sharply lower at this week’s open and is currently down 0.84% at 99.14. The Euro has surged on the outcome of the French election results. Exit polls, released as polling stations closed, reported that centrist Macron had won just below 24%, while National Front leader, Marine Le Pen, came in with just under 22%. (DXY: -0.74% at 98.91)
EUR/USD: The euro was up more than 1% against the dollar on Monday after jumping to 5-month highs earlier as the results of the first round of voting in French presidential elections eased concerns about the future of the euro zone. Macron took 23.8% of the vote ahead of Le Pen on 21.7% according to final voting figures from France's Interior Ministry. (EUR/USD: 1.31% at 1.087)
Japan Yen: The Japanese yen fell sharply at this week’s open as risk appetite improved following the first round of the French presidential elections. Far-right populist Marine Le Pen and political novice Emmanuel Macron have moved on to the second round of elections. With 97% of polling stations declared, Macron was leading the vote at 23.9%, while Le Pen was close behind at 21.4%. (USD/JPY: 1.08% at 110.18)
British Pounds: remains in a consolidation mode following last Tuesday’s large run to the upside in response to a call for early general elections on June 8th by British Prime Minister Theresa May. Sterling rallied significantly on the news, moving to the highest level since October 2016. At present, the pair is trading at 1.2827 a gain of 0.17% over Friday’s close. (GBP/USD: -0.35% at 1.278)
Gold prices are weaker this morning, Monday April 24, on the back of the results of the first round of the French presidential election that has put Emmanuel Macron and Marine Le Pen in the run-off election on May 7. The result has led to some liquidation of haven trades. (Gold Prices: -1.43% at $1,268.98)
Oil prices gave up early gains on Monday, as a relentless rise in U.S. drilling countered expectations that OPEC will extend output cuts until the end of 2017. (Brent Crude Futures: -0.08% at $51.92 a barrel. WTI Futures: -0.16% at $49.54 a barrel)
Steel and iron ore futures in China ended slightly higher on Monday after falling as much as 3 percent intraday, pressured by lingering worries over weak demand in the world's top steel consumer. (Shanghai Steel Rebar Futures: +0.2% at 2,927 yuan per tonne. Iron Ore Contract: +0.3% at 503 yuan tonne.)
Econ & Policy
Americas
The Chicago Fed National Activity Index (CFNAI) declined to 0.08 for March following a revised 0.27 gain for February which was originally reported as a 0.34 increase. The 3-month moving average declined to 0.03 from a revised 0.16 previously with a sharp downward revision to the January data.
Canadian wholesale sales -0.2% vs. -1.0% forecast from 3.0% in the preceding month.
Europe
German Ifo business climate 112.9 vs. 112.5 forecast from 112.4 in the preceding month. The monthly index is based on a survey of around 7,000 German firms in the manufacturing, construction, wholesale and retail sectors. German business morale brightened more than expected in April, hitting its highest in nearly six years, a survey showed on Monday, suggesting Europe's largest economy is set to carry its robust upswing into the second quarter of this year.
U.K. CBI industrial trends orders 4 vs. 5 forecast from 8 in the preceding month.
Asia and Pacific
Japan’s Leading Index 104.8 vs. 104.4 forecast from 104.4 in the preceding month.
PolicyIMF drops anti-protectionism pledge: A communique from the IMF's steering committee said that officials "are working to strengthen the contribution of trade to our economies," but dropped a pledge to resist protectionism. Such language echoes a statement last month from G20 nations, reflecting the Trump administration's call to rethink the global order for commerce.
IMF: More Greek reforms are needed: How to proceed with Greece also "consumed a lot of time" at the IMF's spring meeting and emergency financing from the fund is still an open question. "Fiscal reforms, pension reforms, tax reforms, are only a down payment," said Poul Thomsen, IMF's European department chief. It will take "deep structural reforms, many of which are not yet on the books."
The World Bank and AIIB have agreed to deepen their cooperation with a framework for knowledge sharing, staff exchanges, analytical work, development financing and country-level coordination. The MOU, which discusses more projects to be co-financed in 2017/2018, comes a year after the two multilateral lenders established mechanisms for cost-sharing of investment projects.
Americas
U.S. to revive EU trade talks: U.S. Commerce Secretary Wilbur Ross has opened the door to reviving negotiations with the EU, but warned the bloc it would be in competition with China and Japan to do the first deal with the new U.S. administration. He is due to host Cecilia Malmstrom, the EU's trade commissioner, in Washington today for their first meeting to discuss how to proceed with talks over the previously proposed TTIP trade deal.
Congress aims to avoid shutdown: With a deadline looming this week to avert a U.S. government shutdown, Congress returns to work today as President Trump leans on Democrats to include border wall funding and warns "ObamaCare is in serious trouble." A healthcare vote could surface this week, along with some type of tax reform announcement, while Saturday will mark Trump's 100th day in office.
Europe
Results from the French election showed Emmanuel Macron and Marine Le Pen advancing to a presidential runoff as voters turned their backs on the political establishment. The independent centrist won 23.75% of the vote vs. the National Front leader's 21.53%, in one of the most tightly run races in decades. Polls, that were largely accurate in predicting the first round outcome, suggest Macron is likely to win the next vote scheduled for May 7.
Asia and Pacific
China shares sink amid leverage crackdown: China stocks tumbled overnight to record their biggest loss of the year, with the Shanghai Composite falling as much as 1.9%, before paring declines to 1.4%. The country's banking regulator said late Friday it will strengthen a crackdown on irregularities in the financial sector, while the nation's top insurance official is being investigated on suspicion of "severe" disciplinary violations.
N.Korea ready to sink U.S. carrier: North Korea said its revolutionary forces are "combat-ready to sink a U.S. nuclear powered aircraft carrier with a single strike... an actual example to show our military's force." It comes as two Japanese navy ships join a U.S. carrier group for exercises in the western Pacific. Pyongyang has also detained another U.S. citizen, bringing the total number of Americans held by the isolated country to three
Business News
An American Airlines (NASDAQ:AAL) flight attendant has been removed from duty after a video showing an onboard clash over a baby stroller went viral. "What we see on this video does not reflect our values or how we care for our customers," American said in a statement. It comes at a charged time for the airline industry after a passenger was violently dragged off a United Airlines (NYSE:UAL) flight in Chicago.
ConsumersAmerican retailers are closing stores at a record pace, with 2,880 retail closing announcements this year, more than double the number from the same period in 2016. Just last week, Bebe Stores (NASDAQ:BEBE) said it would close its remaining 170 shops and sell only online, while Rue21 announced plans to close about 400 of its 1,100 locations. If the pace continues, more retailers will close shop than during the 2008 recession.
Sears (NASDAQ:SHLD), amid a cash crunch, has announced more steps to try to get its financial house in order after shuttering stores to boost its bottom line. The beleaguered retailer has raised its savings goal for this year to $1.25B, is evaluating bids for real estate totaling more than $700M, and will close 92 pharmacies in Kmart stores, along with 50 Sears Auto Centers.
Netflix (NASDAQ:NFLX) intends to offer €1B aggregate principal amount of senior notes through an offering outside the U.S. The company expects to use its net proceeds for general corporate purposes, which may include content acquisitions, capital expenditures, investments, working capital and potential strategic transactions.
Starting this week, a new era for Fox News (FOX, FOXA) begins. Tucker Carlson will assume the network's 8 p.m. slot, marking the first time in nearly two decades Bill O'Reilly will not be kicking off the prime-time lineup. About 3.3M viewers tuned in to The Factor, hosted by Dana Perino once O'Reilly was dismissed, but by Thursday of last week, viewership fell to 2.7M viewers.
HealthcareBecton Dickinson (NYSE:BDX) will acquire C. R. Bard (NYSE:BCR) in a $24B cash-and-stock deal, adding the latter's devices to its portfolio in the high-growth sectors of oncology and surgery. It's the latest in a string of deals in the medical technology sector, as manufacturers turn to acquisitions to boost profit margins. It comes two years after Becton acquired CareFusion for $12B.
FinancialsCredit Suisse (NYSE:CS) won't decide on how it wants to raise fresh capital until after this week's annual meeting, SonntagsZeitung reports. The bank is considering a quick-fire share sale or listing 20%-30% of its domestic business in order to raise between 3B-6B Swiss francs. Earlier this month, Credit Suisse offered to cut management bonuses and freeze director pay in an attempt to quash a shareholder revolt.
Information TechnologyApple (NASDAQ:AAPL) CEO Tim Cook threatened to have UBER removed from the App Store in 2015, when he learned that the ride-sharing company had been secretly tracking iPhones (even if users had deleted the app), NYT reports. The article is a wide-ranging profile of Uber CEO Travis Kalanick, describing him as a leader who is willing to break rules to get his way.
Clues about Apple's (AAPL) self-driving car program? Included in documents released by the California DMV are training plans for "operators" to take back control of a self-driving car and signs of an Apple development platform that can "capture and store relevant data" before a collision occurs. However, nothing confirms if Apple aims to build a car from scratch or create a self-driving platform to be used by a partner manufacturer.
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
Emerging Market
ETF Flow
Asset Class
Asset Class: Equity
Geography Regions
Geography Regions: Asia Pacific
Calendar
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Sources