The S&P 500 Index ($SPX) (SPY) is up +0.01%, the Dow Jones Industrials Index ($DOWI) (DIA) is down -0.03%, and the Nasdaq 100 Index ($IUXX) (QQQ) is down -0.13%.
In yesterday’s trading session, Wall Street’s major indexes ended higher. Cintas (CTAS) climbed over +8% and was the top percentage gainer on the Nasdaq 100 after the uniform rental firm reported upbeat Q3 results and raised its FY24 guidance. Also, Merck & Company (MRK) advanced more than +4% and was the top percentage gainer on the Dow after the U.S. Food and Drug Administration approved its pulmonary arterial hypertension drug Winrevair. In addition, nCino (NCNO) surged over +18% after reporting stronger-than-expected Q4 adjusted EPS and offering solid FY25 adjusted EPS guidance. On the bearish side, GameStop Corp (GME) plunged more than -15% after the videogame retailer reported weaker-than-expected Q4 results.
Fed Governor Christopher Waller stated Wednesday that there is no urgency to cut interest rates, underscoring that recent economic data justifies postponing or reducing the number of cuts seen this year. Waller characterized recent inflation figures as “disappointing” and said he wants to see “at least a couple months of better inflation data” before lowering interest rates.
“We believe that the current market easing expectations for the Fed still need to adjust,” Win Thin and Elias Haddad, strategists at Brown Brothers Harriman, wrote in a note.
U.S. rate futures have priced in an 8.7% chance of a 25 basis point rate cut at the May FOMC meeting and a 55.4% chance of a 25 basis point rate cut at the conclusion of the Fed’s June meeting.
Meanwhile, the spotlight remains on a key February reading of the U.S. core personal consumption expenditures price index, the Fed’s preferred inflation gauge. The data is scheduled for release on Friday when the U.S. markets will be closed in observance of the Good Friday holiday. Fed Chair Jerome Powell and San Francisco Fed President Mary Daly are also scheduled to make appearances on Friday.
Today, all eyes are focused on the final U.S. GDP reading in a couple of hours. Economists, on average, forecast that the U.S. GDP will stand at +3.2% q/q in the fourth quarter, compared to the third-quarter value of +4.9% q/q.
Also, investors will likely focus on the U.S. Chicago PMI, which stood at 44.0 in February. Economists foresee the March figure to be 45.9.
U.S. Pending Home Sales data will be reported today. Economists expect February’s figure to be +1.4% m/m, compared to the previous figure of -4.9% m/m.
The U.S. Michigan Consumer Sentiment Index will also be closely watched today. Economists foresee this figure to stand at 76.5 in March, compared to February’s number of 76.9.
U.S. Initial Jobless Claims data will come in today as well. Economists estimate this figure to be 212K, compared to last week’s number of 210K.
In the bond markets, United States 10-year rates are at 4.228%, up +0.72%.
The Euro Stoxx 50 futures are up +0.34% this morning, with the index on course to conclude a second straight quarter with gains. Travel and retail stocks outperformed on Thursday, while financial stocks retreated. The Office for National Statistics said Thursday that the U.K.’s quarterly gross domestic product fell by 0.3% in the fourth quarter, confirming the initial estimate. Separately, data from the Federal Statistical Office showed on Thursday that Germany’s monthly retail sales unexpectedly fell in February. In corporate news, Jd Sports Fashion Plc (JD-.LN) climbed over +6% after the sportswear retailer maintained its full-year profit forecast. At the same time, Soitec (SOI.FP) tumbled more than -12% after the French chip maker provided a disappointing revenue forecast.
U.K.’s GDP, Germany’s Retail Sales, Germany’s Unemployment Rate, and Germany’s Unemployment Change data were released today.
U.K. GDP has been reported at -0.3% q/q and -0.2% y/y in the fourth quarter, in line with expectations.
The German February Retail Sales stood at -1.9% m/m and -2.7% y/y, weaker than expectations of +0.4% m/m and -0.8% y/y.
The German March Unemployment Rate was at 5.9%, in line with expectations.
The German March Unemployment Change came in at 4K, stronger than expectations of 10K.
Asian stock markets today closed mixed. China’s Shanghai Composite Index (SHCOMP) closed up +0.59%, and Japan’s Nikkei 225 Stock Index (NIK) closed down -1.46%.
China’s Shanghai Composite Index closed higher today following a report that fueled speculation about Beijing’s intention to expand its monetary-easing tools to stimulate the economy. Technology stocks outperformed on Thursday. The South China Morning Post reported on Thursday that President Xi Jinping said the central bank should increase the trading of treasury bonds in its open market operations. Also contributing to positive sentiment, Reuters reported that China intends to issue some policy bank bonds earlier in the second quarter ahead of planned sales of special treasury bonds. Meanwhile, China’s top legislator, Zhao Leji, stated on Thursday that the nation’s economy would provide a robust driving force for the world’s recovery. In other news, Citi revised its projection for China’s 2024 GDP growth upward to 5.0% from the previous estimate of 4.6%, citing recent improved policy delivery and positive consumption and investment data. In corporate news, China Everbright Bank plunged over -12% in Hong Kong after reporting weaker-than-expected annual profit due to lower net interest income and a surge in Q4 provisions.
Japan’s Nikkei 225 Stock Index closed sharply lower today, dragged by falls in high-dividend stocks, while concerns regarding a possible currency intervention by the government also weighed on sentiment. Losses in high-dividend stocks led the overall market lower on Thursday as many traded ex-dividend. Meanwhile, the yen steadied after hitting a 34-year low against the dollar on Wednesday, prompting Japan’s three main monetary authorities to convene an unscheduled meeting. In a briefing afterward, top currency diplomat Masato Kanda stated that he “won’t rule out any steps to respond to disorderly FX moves.” In other news, a summary of opinions from the Bank of Japan’s policy meeting last week indicated that officials deliberated on the necessity to stay cautious in their approach toward additional interest rate hikes. The Nikkei Volatility, which takes into account the implied volatility of Nikkei 225 options, closed down -1.14% to 19.06.
Pre-Market U.S. Stock Movers
RH (RH) climbed over +9% in pre-market trading after the company offered a stronger-than-expected 2024 revenue growth forecast.
Snowflake (SNOW) gained more than +3% in pre-market trading following CEO Sridhar Ramaswamy’s disclosure in an SEC filing of purchasing 31,542 shares of the company at $158.52 per share, totaling $5 million.
MillerKnoll (MLKN) plunged over -12% in pre-market trading after reporting mixed Q3 results and issuing soft FY24 adjusted EPS guidance.
Sprinklr (CXM) rose more than +5% in pre-market trading after the company reported upbeat Q4 results and provided solid FY25 guidance.
Weibo (WB) fell over -2% in pre-market trading after Goldman Sachs downgraded the stock to Neutral from Buy with a $10.60 price target.
Estee Lauder (EL) advanced more than +2% in pre-market trading after BofA upgraded the stock to Buy from Neutral with a $170 price target.
You can see more pre-market stock movers here
Today’s U.S. Earnings Spotlight: Thursday - March 28th
Walgreens Boots (WBA), BRP Inc (DOOO), Semtech (SMTC), Oxford Industries (OXM), Azul (AZUL), REX American Resources (REX), Planet Labs PBC (PL), Torrid Holdings (CURV), Pulse Biosciences (PLSE), Jiayin (JFIN), Kodiak Sciences (KOD), D Wave Quantum (QBTS), P3 Health Partners (PIII), Sharecare (SHCR), Gold Royalty (GROY), INmune Bio (INMB).
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On the date of publication, Oleksandr Pylypenko 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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