Morning Markets
June S&P 500 futures (ESM23) this morning are down -0.02%, and June Nasdaq 100 E-Mini futures (NQM23) are down -0.18%.
U.S. stock index futures this morning are slightly lower on mixed corporate earnings. However, lower T-note yields this morning are providing underlying support. The markets are showing an 88% chance of a 25 bp rate hike by the Federal Reserve at the May 2-3 FOMC meeting and have fully priced in a 25 bp rate hike by the ECB at its May 4 ECB meeting.
Global bond yields are mixed. The 10-year T-note yield is down -0.8 bp at 3.524%. The 10-year German bund yield is up +2.5 bp at 2.471%. The 10-year UK gilt yield is down -2.1 bp at 3.746%.
On the bearish side for stocks, Autoliv tumbled more than -4% in pre-market trading after reporting weaker-than-expected Q1 adjusted EPS. Also, Seagate Technology Holdings Plc, Overstock.com, Big Lots, and Everbridge are down -1% or more after being downgraded.
On the positive side, HCA Healthcare jumped more than +6% in pre-market trading after reporting better-than-expected Q1 EPS and raising guidance on full-year EPS. Also, Procter & Gamble is up more than +2% after reporting stronger-than-expected Q3 net sales and raising its full-year organic revenue forecast. In addition, CSX is up more than +2% after reporting Q1 revenue above consensus.Â
Overseas stock markets are lower. The Euro Stoxx 50 is down -0.08%. China’s Shanghai Composite closed down -1.95%, and Japan’s Nikkei Stock Index closed down -0.33%.Â
The Euro Stoxx 50 index today is slightly lower. Mining stocks and metals producers are under pressure today after iron ore prices fell to a 4-month low and copper prices dipped to a 1-week low. Hawkish ECB comments also weighed on stocks after ECB Vice President Guindos said, "Core inflation remains very sticky," and ECB Governing Council member Makhlouf said it's too early for the ECB to plan a pause in tightening.  However, losses were contained as technology stocks moved higher after SAP SE, Europe’s biggest software company, rose after it forecasted full-year operating profit above the consensus.Â
Eurozone economic news today was mixed after the Eurozone Apr S&P manufacturing PMI unexpectedly fell -1.8 to 45.5, weaker than expectations of an increase to 48.0 and the weakest level in nearly three years. However, the Apr S&P composite PMI rose +0.7 to an 11-month high of 54.4, stronger than expectations of no change at 53.7.
Hawkish ECB comments today weighed on stocks. ECB Vice President Guindos said, "Core inflation remains very sticky" and may be more persistent than markets had anticipated. Also, ECB Governing Council member Makhlouf said it's too early for the ECB to plan a pause in tightening, and interest rates need to continue at "restrictive levels."
China’s Shanghai Composite Stock Index today fell to a 1-1/2 week ow and closed moderately lower. Chinese technology stocks sold off today and weighed on the overall market on rising geopolitical tensions with the U.S. President Biden aims to sign an executive order in the coming weeks that will limit U.S. companies’ investment in microchips, artificial intelligence, and quantum computing in China. The U.S. has been briefing its G-7 partners on the investment curbs for high-tech industries and hopes to get an endorsement at next month’s G-7 meeting. The rising geopolitical pressures prompted foreign funds to liquidate their Chinese positions after Bloomberg reported that Hong Kong traders sold 7.6 billion yuan ($1.1 billion) of Chinese stocks today, the most net selling in a single day since before China’s reopening rally began last year. On the positive side, Chinese defense companies rallied after the Chinese government announced plans to conduct at least five military drills in various areas, including waters off its coast and in the South China Sea.Â
Japan’s Nikkei Stock Index today fell back from a 7-1/2 month high and closed moderately lower. Japanese stocks today initially moved higher as Japanese semiconductor production equipment makers rose after Taiwan Semiconductor Manufacturing Co reaffirmed its target for capital spending this year despite a persistent slump in demand. However, the Nikkei Stock Index gave up its advance and turned lower after a rally in the Japanese yen to a 4-session high sparked a decline in exporter stocks. The yen rallied after Japan’s Mar national CPI ex-food and energy rose more than expected by the most in 41 years.
The Japan Apr Jibun Bank manufacturing PMI rose +0.3 to a 6-month high of 49.5.
The Japan Mar national CPI ex-food and energy rose +3.8% y/y, stronger than expectations of +3.6% y/y and the largest increase in 41 years.
Pre-Market U.S. Stock Movers
Autoliv (ALV) tumbled more than -4% in pre-market trading after reporting Q1 adjusted EPS of 90 cents, weaker than the consensus of 92 cents.Â
Freeport-McMoRan (FCX) slid more than -1% in pre-market trading after iron ore prices fell to a 4-month low and copper prices fell to a 1-week low.
Big Lots (BIG) dropped more than -5% in pre-market trading after Piper Sandler downgraded the stock to underweight from neutral, citing weakening demand for home furnishings and mattresses.Â
Overstock.com (OSTK) fell more than -3% in pre-market trading after Piper Sandler downgraded the stock to neutral from overweight.
Seagate Technology Holdings Plc (STX) slid more than -1% in pre-market trading after Morgan Stanley downgraded the stock to equal weight from overweight.Â
Everbridge (EVBG) tumbled more than -5% in pre-market trading after Stephens downgraded the stock to equal weight from overweight.
ZIM Integrated Shipping Services Ltd (ZIM) fell more than -2% in pre-market trading after JPMorgan Chase downgraded the stock to neutral from overweight.
Tesla (TSLA) rose more than +1% in pre-market trading after it raised the prices of its Model S and X vehicles in the U.S.Â
Procter & Gamble (PG) climbed more than +2% in pre-market trading after reporting Q3 net sales of $20.07 billion, above the consensus of $19.34 billion, and raised its full-year organic revenue forecast to up +6% from a prior view of up +4-5%, stronger than the consensus of +5.39%.Â
AT&T (T) rose more than +1% in pre-market trading after HSBC upgraded the stock to buy from hold with a price target of $21.Â
HCA Healthcare (HCA) jumped more than +6% in pre-market trading after reporting Q1 EPS of $4.85, stronger than the consensus of $4.14, and raising guidance on full-year EPS to $17.25-$18.55 from a previous projection of $16.40-$17.60.
CSX (CSX) climbed more than +2% in pre-market trading after reporting Q1 revenue of $3.71 billion, above the consensus of $3.59 billion.Â
Tenet Healthcare (THC) rose more than +3% in pre-market trading after Cantor Fitzgerald initiated coverage of the stock with a recommendation of overweight and a price target of $73.Â
Today’s U.S. Earnings Reports (4/21/2023)
Freeport-McMoRan Inc (FCX), HCA Healthcare Inc (HCA), Procter & Gamble Co/The (PG), Regions Financial Corp (RF), Schlumberger NV (SLB).
More Stock Market News from Barchart
- S&P Futures Tick Lower as Mixed Earnings Weigh on Sentiment, PMI Data in Focus
- Stocks Retreat on Weakness in Tech and Soft Economic Reports
- Economic Uncertainty Weighs on Cloud-Computing Divisions at Amazon and Microsoft
- Stocks Fall on Tech Stocks and Weak U.S. Economic Reports
On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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