June S&P 500 E-Mini futures (ESM24) are up +0.19%, and June Nasdaq 100 E-Mini futures (NQM24) are up +0.28% this morning as investors looked ahead to earnings reports from some of the world’s most prominent companies, the Federal Reserve’s policy meeting, as well as the release of the U.S. jobs report later in the week.
In Friday’s trading session, Wall Street’s major averages ended higher, with the benchmark S&P 500 posting a 1-1/2 week high and the tech-heavy Nasdaq 100 notching a 1-week high. Alphabet (GOOGL) climbed over +10% and was the top percentage gainer on the Nasdaq 100 after the Google parent reported Q1 results that easily topped analysts’ expectations, declared its first-ever dividend of $0.20 per share, and announced an additional $70 billion buyback. Also, ResMed (RMD) surged more than +18% and was the top percentage gainer on the S&P 500 after reporting upbeat Q3 results. In addition, Microsoft (MSFT) rose over +1% after the tech giant reported better-than-expected Q3 results. On the bearish side, Intel (INTC) plunged more than -9% and was the top percentage loser on the Dow after the biggest maker of personal computer processors provided weaker-than-expected Q2 guidance.
Data from the U.S. Department of Commerce on Friday showed that the U.S. core PCE price index, a key inflation gauge monitored by the Federal Reserve, came in at +0.3% m/m and +2.8% y/y in March, compared to expectations of +0.3% m/m and +2.6% y/y. Also, U.S. March personal spending rose +0.8% m/m, stronger than expectations of +0.6% m/m. At the same time, the University of Michigan’s gauge of consumer sentiment was revised downward to 77.2 in April, weaker than expectations of 77.8. In addition, the University of Michigan’s April year-ahead inflation expectations were revised upward to +3.2% from +3.1%.
“The hot inflation readings through March should write off any rate cuts in the first half of 2024. There is also a risk that the further economic resilience pushes off any rate declines until 2025, a key downside risk for growth next year,” said Nationwide Senior Economist Ben Ayers.
The U.S. Federal Reserve interest rate decision and Fed Chair Jerome Powell’s post-policy meeting press conference will take center stage in the coming week. The Federal Open Market Committee is anticipated to keep interest rates unchanged for the sixth consecutive meeting on Wednesday, with investors eagerly awaiting clues regarding the central bank’s stance on potential interest rate cuts this year. U.S. rate futures have priced in an 11.7% chance of a 25 basis point rate cut at the June meeting and a 29.0% probability of a 25 basis point rate cut at July’s monetary policy meeting.
First-quarter earnings season continues in full force, and investors anticipate fresh reports from notable companies this week, including Apple (AAPL), Amazon (AMZN), AMD (AMD), Qualcomm (QCOM), Coca-Cola (KO), McDonald’s (MCD), Starbucks (SBUX), Eli Lilly (LLY), Amgen (AMGN), Pfizer (PFE), CVS Health (CVS), Booking Holdings (BKNG), PayPal (PYPL), Mastercard (MA), Kraft Heinz (KHC), and Marriott International (MAR).
On the economic data front, the U.S. Nonfarm Payrolls report for April will be the main highlight. Also, market participants will be monitoring a spate of other economic data releases this week, including the U.S. CB Consumer Confidence, Chicago PMI, Employment Cost Index, S&P/CS HPI Composite - 20 n.s.a., ADP Nonfarm Employment Change, ISM Manufacturing PMI, S&P Global Manufacturing PMI, Construction Spending, JOLTs Job Openings, Crude Oil Inventories, Exports, Imports, Trade Balance, Initial Jobless Claims, Nonfarm Productivity (preliminary), Unit Labor Costs (preliminary), Factory Orders, Average Hourly Earnings, Private Nonfarm Payrolls, S&P Global Composite PMI, S&P Global Services PMI, ISM Non-Manufacturing PMI, and Unemployment Rate.
The U.S. economic data slate is mainly empty on Monday.
In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.626%, down -0.92%.
The Euro Stoxx 50 futures are up +0.12% this morning, tracking a positive session in Asia, while investors braced for more earnings reports, the Fed’s policy decision, and crucial economic data later this week. Preliminary data from the National Statistics Institute showed Monday that the Spanish annual inflation rate rose to 3.3% in April from 3.2% in March. Separately, official data showed Monday that the Eurozone's economic sentiment indicator fell in April. Meanwhile, investor focus is currently on preliminary inflation data from Germany scheduled for later in the session. Market participants will also keep their eyes peeled for the Eurozone’s preliminary economic growth data for the first quarter and preliminary inflation data for April on Tuesday. In corporate news, Anglo American Plc (AAL.LN) rose over +3% following a report from Reuters indicating that BHP Group is contemplating making an improved proposal for the miner. Also, Kon.Philips N.V. (PHIA.NA) soared more than +34% after the Dutch medical equipment maker reached a smaller-than-expected compensation settlement in the U.S. At the same time, Deutsche Bank Ag (DBK.D.DX) slid over -5% following news that a long-running lawsuit stemming from its acquisition of Postbank could potentially cost Germany’s largest lender up to 1.3 billion euros ($1.39 billion).
Spain’s CPI (preliminary), Eurozone’s Business and Consumer Survey, and Eurozone’s Consumer Confidence data were released today.
The Spanish April CPI has been reported at +0.7% m/m and +3.3% y/y, weaker than expectations of +1.0% m/m and +3.4% y/y.
Eurozone April Business and Consumer Survey stood at 95.6, weaker than expectations of 96.9.
Eurozone April Consumer Confidence arrived at -14.7, in line with expectations.
China’s Shanghai Composite Index (SHCOMP) closed up +0.79%, while Japanese markets were closed for a holiday.
China’s Shanghai Composite Index closed higher today as investors cheered the government’s further relaxation of certain restrictions on the property market. Property stocks outperformed on Monday following the relaxation of home-buying restrictions in a major city in southwest China. Chengdu, the capital of China’s Sichuan province, announced on Sunday that starting from April 29th, it would cease reviewing homebuyers’ qualifications for real estate purchases. Also, sentiment got a boost after embattled property developer CIFI Holdings said on Monday that it had reached an agreement with an ad-hoc group of bondholders regarding a plan to restructure its offshore debt. Meanwhile, data from the National Bureau of Statistics revealed on Saturday that China’s industrial profits declined in March compared to the first two months and slowed gains for the quarter. China’s yuan hovered near a five-month low against the dollar on Monday following the People’s Bank of China’s decision to set the official guidance rate at its weakest level in two months. In corporate news, China Petroleum & Chemical fell over -4% after reporting an 8.9% year-over-year decline in Q1 net profit due to increasing raw material costs. Market participants this week will be keeping an eye on crucial Chinese Purchasing Managers’ Index data for April, seeking indications that the long-awaited recovery in the world’s second-largest economy is gaining momentum following last month’s stronger-than-expected data.
Japan’s Nikkei Stock Index today was closed for the Showa Day holiday. The markets will reopen on Tuesday.
Pre-Market U.S. Stock Movers
Tesla (TSLA) climbed over +7% in pre-market trading following a report from Bloomberg indicating that the company cleared China’s data safety requirements and reached an agreement with Baidu to implement its advanced full self-driving features in China using the internet giant’s mapping and navigation functions.
Paramount Global (PARA) gained more than +3% in pre-market trading after Bloomberg reported that both the Redstone family and David Ellison had offered concessions to make a change in control at Paramount more enticing to smaller investors. Also, CNBC reported on Saturday that the media giant intends to fire its Chief Executive Officer, Bob Bakish, as soon as Monday morning.
Apple (AAPL) rose over +2% in pre-market trading following a report from Bloomberg stating that the company has renewed talks with OpenAI regarding the utilization of the startup’s technology for integrating some new features into the iPhone expected later this year. Also, Bernstein upgraded the stock to Outperform from Market Perform with an unchanged price target of $195.
AT&T (T) advanced more than +1% in pre-market trading after Barclays upgraded the stock to Overweight from Equal Weight with an unchanged price target of $20.
Southwest Airlines (LUV) fell over -2% in pre-market trading after Jefferies downgraded the stock to Underperform from Hold with a price target of $20.
Lululemon Athletica (LULU) dropped more than -1% in pre-market trading after Barclays downgraded the stock to Equal Weight from Overweight with a price target of $395.
You can see more pre-market stock movers here
Today’s U.S. Earnings Spotlight: Monday - April 29th
NXP Semiconductors (NXPI), Welltower (WELL), Arch Capital (ACGL), ON Semiconductor (ON), MicroStrategy (MSTR), SBA Communications (SBAC), Everest (EG), Domino’s Pizza Inc (DPZ), Yum China Holdings (YUMC), Sun (SUI), Franklin Resources (BEN), Revvity (RVTY), F5 Networks (FFIV), Lattice (LSCC), Crown (CCK), Qiagen (QGEN), Woodward (WWD), Paramount Global (PARA), SoFi Technologies (SOFI), Amkor (AMKR), MSA Safety (MSA), Brixmor Property (BRX), Rambus (RMBS), Flowserve (FLS), Element Solutions (ESI), Sensata Tech (ST), Transocean (RIG), Sanmina (SANM), CVR Energy (CVI), PotlatchDeltic (PCH), CNO Financial (CNO), Albany (AIN), Alliance Resource (ARLP), Cushman & Wakefield (CWK), HNI (HNI), Coursera (COUR), Acadia (AKR), LTC Properties (LTC), JinkoSolar (JKS), Netstreit (NTST), Kforce (KFRC), Franklin BSP Realty Trust (FBRT), Harmonic (HLIT), Centerspace (CSR).
More Stock Market News from Barchart
- FOMC, Earnings and Other Can't Miss Items This Week
- 3 High-Quality Dividend Stocks to Buy Now
- Meta Platforms Is Too Cheap Based on Its FCF Margins - Shorting OTM Puts Is an Attractive Play
- 5 Top-Rated Russell 2000 Stocks Crushing the Market in 2024
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.
/Renewable%20Energy%20by%20Yuri%20Hoya%20via%20Shutterstock.jpg)
/Micron%20Technology%20Inc_%20logo%20on%20building-by%20vzphotos%20vis%20iStock.jpg)