Market Overview (05.15.2017)
by Alpha NYC
ContentsMarket Today
Indices
Commodities
Currency
Econ & Policy
Economic Indicators
Policy
Business News
Industrials
Consumers
Financials
Information Tech
Data Center
Equity
Bond
ETF Flow
Calendar
Economic Calendar
Market Today
S&P 500 (-0.2% at 2,391) NASDAQ (+0.1% at 6,121) Dow Jones (-0.2% to 20,897) U.S. stocks declined Friday, dragged lower by shares of financials and commodity companies, as investors weighed the aftermath of President Trump’s firing of former FBI Director James Comey earlier this week.
US Dollar Index (DXY): The U.S. dollar reversed early losses against the safe haven yen on Monday, shrugging off another missile test by North Korea on Sunday and threats from a cyber attack that spread around the globe at the weekend. (DXY: -0.34% at 98.71)
EUR/USD: is higher in today’s trading, currently holding near 1.0956, a gain of 0.23% overlast Friday’s close. The pair is following through to the upside amid a lack of economic data releases today out of the Euro zone. The US calendar is also voidof major economic releases. The NY Empire State Manufacturing Index for May will be released at 08:30 ET. However, this report tends to have only a moderate impact on trading. (EUR/USD: 0.50% at1.0988)
British Pound: has started off this week’s trading with a move to the upside, and is currently at 1.2929, a gain of 0.37% over Friday’s close. The advance has confirmed last Friday’s low as a successful test of support at the1.2850 level, a constructive sign that leaves the bias in today’s trading tothe upside. (GBP/USD: 0.20% at 1.2914)
Japan Yen: iscurrently modestly higher, trading at 113.49, a gain of 0.14% over Friday’sclose. The Asian session kicked off with the pair opening in the vicinity ofthe 113.00 level, but USD/JPY quickly stabilized and has since maintained anupside bias and moved into positive territory. (USD/JPY: 0.25% at 113.65)
Gold: The U.S. president's unexpected decision to fire the now former FBI director continued to weigh on the market. Investors are concernedthat the latest events could delay the presidential administration's agenda toimplement a tax reform. (Gold Prices:+0.71%at $1,234.9)
Oil prices have risenmore than 3% after Saudi Arabia and Russia said a deal to cut production should be extended until March next year. (Brent Crude Futures:+3.21%at $52.47a barrel. WTIFutures:+3.47%at$49.5 a barrel)
Chinese steel rebar prices fell on Monday after data showed the world's top produce rchurned out a record tonnage for a second month as mills raced for profits,stoking concerns about a global glut even as Beijing ramps up its effort tocurb excess. (Shanghai Steel Rebar Futures:-0.63%at 2,981 yuan per tonne. IronOre Contract:+0.22% at454yuan tonne.)
Econ & Policy
Americas
The New York Empire State Manufacturing Survey declined to -1 for May from 5.2 the previous month. This was below consensus expectations of 7.0 and the lowes treading for seven months. The new orders component declined to -4.4 from 7.0 and there was a sharp decline in unfilled orders to -3.7 from 12.4 previously, although the shipments index held firm on the month.
Resales of Canadian homes fell 1.7 percent in April from record highs in March as new listings spiked, the Canadian Real Estate Association said on Monday in areport that suggested a long-awaited slow down in housing has begun.
Europe
British employers plan to increase pay at the weakest rate since 2013, a survey showed on Monday, offering poor prospects for British households already strained by higher inflation since last year's Brexit vote. Employers onaverage expected to raise basic pay awards in the year ahead by 1.0 percent,down from 1.5 percent in the previous quarter's survey.
Greece's economy contracted in the first Quarter of the year but less than in the final quarter of 2016, flash estimates by its statistics service showed onMonday, as jitters over the conclusion of a bailout review hurt businessconfidence. The data showed the economy shrank 0.1 percent in January-to-Marchcompared to last year's final quarter when gross domestic product contracted by1.2 percent.
N.Z. retailsales 1.5% vs. 1.1% forecast from 0.6% in the preceding month; N.Z. core retail sales 1.2% vs. 0.9%forecast from 0.7% in the preceding month.
Middle East and Africa
China adds 4.65 million new urban jobs in January-April. China's economy is growing within a reasonable range.
China Jan-April property investment rises 9.3 percent year-on-year. New construction starts measured by floor area were up 11.1 percent in thefirst four months of the year, compared with a 11.6 percent rise in the firstthree months, the NBS data showed. Property sales measured by floor area grew15.7 percent in January-April from the same period a year earlier, down from19.5 percent in the first three months of the year.
Chinese industrial production 6.5% vs. 7.1% forecast from 7.6% in the precedingmonth. Annual fixed-asset investment, a proxy for long-term spending, increased8.9% in the January-April period. Urban investment had accelerated 8.9% in theyear to March.
Chinese retail sales 10.7% vs. 10.6% forecast from 10.9% in the preceding month.
Japan’s Corporate Goods Price Index 2.1% vs. 1.8% forecast from 1.4% in the preceding month.
Australi an home loans -0.5% vs. 0.1% forecast from -0.8% in the preceding month.
PolicyAmericas
WannaCry puts focus on cybersecurity stocks: Security officials are scrambling to find out who was behind the WannaCry ransomware attack, which struck 200K victims in at least 150 countries, and is believed to have been stolen from the NSA. Shares of cybersecurity stocks are on watch amid fears a second wave could cause more chaos, while Microsoft (NASDAQ:MSFT) pinned blame on the U.S. government for not disclosing more software vulnerabilities.
Mnuchin comments on U.S. protectionism: "We are working to strengthen the contribution of trade to our economies," stated a G7 communique issued on Saturday that once again fell short of an explicit promise to avoid protectionism. U.S. Treasury Secretary Steven Mnuchin wrapped up the finance chief gathering with the following statement: "We do not want to be protectionist but we reserve our right to be protectionist to the extent that we believe trade is not free and fair."
Europe
Macron takes power in France: Emmanuel Macron was sworn in as French president on Sunday, promising to return confidence to a nation that had been "broken" by a spate of terror attacks and a sluggish economy. European equity funds saw record inflows totaling $6.1B in the days after Macron's election win, according to data from EPFR, while BofA analysts feel that flows could increase further in the coming months.
Greece cuts 2017 growth forecast: Greece has slashed its 2017 growth forecast to 1.8% from 2.7%, according to a mid-term budget plan, driven by uncertainty caused by delays in concluding its latest review of bailout reforms. The projections are also lower than those of the EU Commission, which cut its growth estimates last week to 2.1%, from 2.7% predicted three months ago.
Asia and Pacific
U.S. will attend Silk Road summit: China managed to rope in the U.S. at the last minute for its weekend Silk Road summit as President Xi hailed his country's initiative as "the project of the century." Matt Pottinger, Special Assistant to the President and senior director for East Asia at the National Security Council, led the American delegation to the forum.
North Korea fires a new ballistic missle: The United States will "continue to tighten the screws" on North Korea, declared Nikki Haley, U.S. Ambassador to the United Nations, after Pyongyang's latest missile test. She also mentioned sanctions and working with the international community. Following the launch, the isolated regime boasted that its new rocket could carry a "large-size heavy nuclear warhead."
North Korea open to U.S. talks: However, Pyongyang is willing to have dialogue with the U.S. if "the conditions are there," said Choi Son Hui, North Korea's foreign ministry director general for U.S. affairs. The remarks come days after President Trump said he was willing to meet with Kim Jong Un "under the right circumstances." The last time the two countries sat at the negotiating table was in 2008.
Business News
Toshiba (OTCPK:TOSYY) shares climbed 3.4% in Tokyo, buoyed by news that progress is being made towards capping some of its nuclear liabilities in the U.S. The owners of the unfinished Vogtle plant in Georgia - led by Southern Co. (NYSE:SO) - have come to a preliminary agreement to limit Toshiba's guarantees on the much-delayed power project at about $3.6B.
Thermo Fisher (NYSE:TMO), scientific instruments maker, is in talks to buy drug ingredients producer Patheon (NYSE:PTHN). An agreement could be announced as early as this week, Bloomberg reports, but there's no certainty a deal will be reached. Patheon is worth about $3.8B based on its current share price, while Thermo Fisher has a market value of about $67B.
SpaceX (Private:SPACE) is aiming to launch a fourth Inmarsat-5 (OTCPK:IMASY) satellite into space tonight, marking the heaviest load lofted by a Falcon 9 rocket to date. The departure comes two weeks after the last SpaceX mission, matching a three-year-old company record for the shortest time between consecutive launches. It's targeting two per month for all of 2017 and once a week by 2019.
ConsumersAlphabet's (GOOG, GOOGL) Waymo, escalating a fight with UBER,, has signed a collaboration agreement with LYFT to bring autonomous vehicle technology into the mainstream. The two will work on pilot projects and other product development efforts. The alliance also makes Waymo a GM partner, by way of Lyft's work with (and investment by) the auto giant.
FinancialsJPMorgan (NYSE:JPM) has agreed to purchase a building in Dublin with room for 1,000 staff as Ireland continues a major campaign to attract firms in the wake of Brexit. It has been mainly competing with Paris and Frankfurt to attract financial firms. "This new building gives us room to grow and some flexibility within the EU," said JPMorgan's Carin Bryans.
Information TechnologyGoogle (GOOG, GOOGL) is changing how it enforces its ad policies: AdSense will now remove adverts on a page-by-page basis, instead of targeting entire websites that violate its standards. Since Google and its publishers share ad revenue, the more "surgical" approach will mean more money for the both of them and fewer disruptions.
Data Center
Equity
S&P500
Dow Jones 30
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 CDS
ETF Flow
Asset Class: Equity
Geography Regions
Geography Regions: Asia Pacific
Calendar
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Sources