US Session Highlights
(US) DOE CRUDE: -1.0M V -1ME; GASOLINE: +1.5M V -2ME; DISTILLATE: -2.0M V -1ME
(BR) Brazil Apr IGP-M Inflation (2nd Preview): -1.0% v -0.7%e
(US) MBA MORTGAGE APPLICATIONS W/E APR 14TH: -1.8% V 1.5% PRIOR
US equities opened the morning higher, though trading remained somewhat muted ahead of the weekend French election and a continued dearth of news out of DC. Risk-on flows largely returned to global markets, as Treasury prices dropped along with gold, and the USD/JPY has rebounded. As the session wore on, stocks weakened modestly and crude sold off after a smaller-than-expected inventory draw, but healthcare and industrials held onto tepid gains, while energy, consumer staples, and utilities declined.
US markets on close: Dow -0.6%, S&P500 -0.2%, Nasdaq +0.2%
Best Sector in S&P500: Healthcare
Worst Sector in S&P500: Energy
Biggest gainers: LRCX +6.9%; ISRG +6.4%; WRK +4.5%
Biggest losers: IBM -4.9%; MRO -4.3%; NFX -3.5%
At the close: VIX 14.9 (+0.5pts); Treasuries: 2-yr 1.18% (+1bps), 10-yr 2.22% (flat), 30-yr 2.87% (+3bps)
US movers afterhours
SCSS Reports Q1 $0.56 v $0.46e, R$393.3M v $370Me; Raises FY17 Rev $1.25-1.50 v $1.31e; +13.2% afterhours
QCOM Reports Q2 $1.34 v $1.20e, R$6.0B v $5.88Be; Guides Q3 $0.90-1.15 v $1.09e; +2.4% afterhours
CSX Reports Q1 $0.51 v $0.43e, R$2.87B v $2.73Be; +2.7% afterhours
EBAY Reports Q1 $0.49 v $0.48e, R$2.22B v $2.21Be; Guides Q2 $0.43-0.45 v $0.48e; R$2.28-2.32B v $2.32Be; Non-GAAP op margin 30.0% v 33.4% y/y; -1.9% afterhours
URI Reports Q1 $1.63 v $1.57e, R$1.36B v $1.34Be; Adj EBITDA margin 43.6% v 44.6% y/y; -6.3% afterhours
Key economic data
(NZ) NEW ZEALAND Q1 CPI Q/Q: 1.0% (1-year high) V 0.8%E; Y/Y: 2.2% (highest since Q3 of 2011) V 2.0%E
(AU) AUSTRALIA Q1 NAB BUSINESS CONFIDENCE: 6 V 5 PRIOR
(JP) JAPAN MAR TRADE BALANCE: ¥614.7B V ¥608BE; ADJ TRADE BALANCE: ¥172.2B V ¥172BE
(CN) China Mar FX Net Client Settlements (CNY): -48.3B v -69.2B prior
Asia Session Notable Observations, Speakers and Press
Asia indices trading mixed tracking heavy tone on Wall St, where slumping oil prices weighed on the Energy sector while low-beta Utilities/Staples also stumbled. Traders are starting to square positions going into the French elections this weekend, though there is little evidence of continued momentum behind the wild-card Melenchon in the first round after a recent surge. New Zealand Q1 CPI was the most notable datapoint of the session, rising to 5-year high annualized where Tradable prices increased 1.6%, while prices for non-tradables increased 2.5%, prompting some analysts to adjust their RBNZ tightening outlook forward. NZD/USD spiked some 40pips on the result and held its gains. Japan Trade numbers were also notable but less market moving, with surplus just above consensus, imports growth at a 3-year high, and exports at a 2-year high.
China
(CN) China State Administration of Foreign Exchange (SAFE) spokesperson: Pressure on capital outflows eased significantly in Q1 – press
(CN) China state planner NDRC said to release a 2nd batch of public-private projects – Chinese press
(CN) Former China State Administration of Foreign Exchange (SAFE) Official Guan Tao: Non-financial institutions and other participants should be allowed into the bank-dominated onshore yuan market to boost liquidity and price discovery
Australia
(AU) According to the latest property industry survey by ANZ and the Property Council of Australia, property firms and investors are most optimistic about outlook for property prices since 2014 – AFR
(AU) CBA: Australia inflation is skewed much lower because land prices are not included in the CPI basket – AFR
Asian Equity Indices/Futures (00:00ET)
Nikkei +0.2%, Hang Seng +0.4%, Shanghai Composite -0.1%, ASX200 +0.2%, Kospi +0.4%
Equity Futures: S&P500 +0.1%; Nasdaq +0.1%, Dax +0.2%, FTSE100 +0.2%
FX ranges/Commodities/Fixed Income (00:00ET)
EUR 1.0707-1.0721; JPY 108.80-109.10; AUD 0.7490-0.7510; NZD 0.7000-0.7045
June Gold -0.2% at 1,281/oz; June Crude Oil +0.6% at $51.14/brl; May Copper -0.6% at $2.51/lb
SPDR Gold Trust ETF daily holdings rise 11.8 tonnes to 860.8 tonnes; 4th straight increase; highest since Dec 7th
iShares Silver Trust ETF daily holdings fall to 10,149 tonnes from 10,178 tonnes prior
(JP) Japan’s MoF sells ¥0.9T in 0.7% (0.7% prior) 20-year JGBs; Avg yield: 0.562% v 0.673% prior; bid-to-cover: 4.06x (highest since 2014) v 3.78x prior
(CN) PBOC to inject combined CNY100B v CNY80B prior in 7-day, 14-day and 28-day reverse repos
(CN) PBOC SETS YUAN MID POINT AT 6.8792 V 6.8664 PRIOR; biggest margin of weakness in 3 weeks
(NZ) New Zealand sells NZ$150M in 2.75% 2025 bonds; avg yield 2.889%
Asia equities/Notables /movers by sector
Australia:
Rio Tinto (RIO) +0.3%; Q1 production
Iluka (ILU) +11.0%; Q1 results
Santos (STO) -2.9%: Q1 results
Woodside Petroleum (WPL) -1.5%; Q1 results
Hong Kong:
Ajisen (538) +0.3%; Q1 SSS
Qingdao Port International (6198) +0.7%; FY16 results
Yanzhou Coal Mining -0.2%; Guides Q1
CNOOC and PetroChina -1.0% on lower oil prices
Japan:
Toshiba (6502) +4.7%; Hon Hai/Amazon or Dell joint bid for chip unit speculation
Canon (7751) +3.1%; Q1 results speculation
Sumitomo Heavy (6302) +1.0%; FY17 results speculation
