US Session Highlights
(US) MAR HOUSING STARTS: 1.22M V 1.25ME; BUILDING PERMITS: 1.26M V 1.25ME
(CA) CANADA MAR EXISTING HOME SALES M/M: 1.1% V 5.2% PRIOR
(US) MAR INDUSTRIAL PRODUCTION M/M: 0.5% V 0.4%E; CAPACITY UTILIZATION: 76.1% V 76.1%E
IMF raises FY17 global growth forecast to 3.5% from 3.4% prior
US equities started the morning lower, weighed down by weakness in European bourses and disappointing earnings from Goldman Sachs and J&J. Markets pared losses as the session wore on but ended in the red. The EUR/USD hit fresh 2-week highs and Dollar index dropped 0.7% after UK Prime Min May’s call for snap elections, and U.S. Treasuries moved higher as the 10-yr yield lost 6bps. Oil dropped in a choppy trading day, and WTI crude settled down 0.5%. Consumer staples were solidly in the green on the day, boosted by new all-time highs in PepsiCo and Dr Pepper Snapple, while health care and financials were the market laggards.
US markets on close: Dow -0.6%, S&P500 -0.3%, Nasdaq -0.1%
Best Sector in S&P500: Consumer Staples
Worst Sector in S&P500: Health Care
Biggest gainers: AN +3%; IP +1.9%; IRM, +1.8%
Biggest losers: CAH -11.5%; GWW -11.4%; ABC -4.7%
At the close: VIX 14.4 (-0.2pts); Treasuries: 2-yr 1.16% (-4bps), 10-yr 2.17% (-8bps), 30-yr 2.84% (-7bps)
US movers afterhours
NVLS To merge with Alpine Immune Sciences in all-stock deal valuing NVLS at approx $50M; +29.6% afterhours
RARE Ultragenyx, Kyowa Hakko Kirin and Kyowa Kirin International announce positive 24-week data from Adult Phase 3 Study of Burosumab (KRN23) in X-Linked Hypophosphatemia; +22.9% afterhours
ISRG Reports Q1 $5.09 v $4.90e, R$674.2M v $661Me; +4.3% afterhours
LRCX Reports Q3 $2.80 v $2.54e, R$2.15B v $2.13Be; Guides Q4 $2.88-3.12 v $2.63e; R$2.2-2.4B v $2.18Be; +3.6% afterhours
IBM Reports Q1 $2.38 v $2.34e, R$18.2B v $18.5Be; Affirms FY17 at least $13.80 v $13.80e; -3.8% afterhours
DSX Announces $70M offering of common shares (16% of market cap); CEO, other executives and directors agree to buy $20M in the public offering; -9.8% afterhours
Key economic data
(NZ) NEW ZEALAND MAR PERFORMANCE SERVICES INDEX: 59.0 V 58.7 PRIOR
(AU) AUSTRALIA MAR WESTPAC LEADING INDEX M/M: +0.1% V -0.1% PRIOR
(AU) AUSTRALIA MAR NEW MOTOR VEHICLE SALES M/M: 1.9% V -2.7% PRIOR; Y/Y: -3.0% V -4.0%PRIOR
Asia Session Notable Observations, Speakers and Press
Risk appetite waning in the wake of soft US housing data and a bombshell out of the UK about snap elections. Asia indices tracking lower close on Wall St, where Financials, Energy and Health Care were the worst performs while lower-beta Utilities/Telecom/Staples gained. US Treasuries were also bid higher, with 10-yr yield extending its slide below 2.20%. May WTI contract declined about $0.30 on lower draw in API petroleum inventories.
China:
(CN) China said to have eased its yuan outflow controls last week – Chinese press
(CN) China premier Li: China and EU should send signals of globalization and free trade – press citing comments from meeting with EU’s Mogherini
Japan:
(JP) Japan deputy chief cabinet Sec Hagiuda: To closely monitor UK election and Brexit developments – press
(JP) Incoming members on the BOJ board to bolster the camp of proponents for quantitative easing – Nikkei
Australia:
(AU) Australia Trade Min Ciobo: Have seen a strengthening in Japan/Australia relations
Korea:
(KR) South Korea Fin Min Yoo: Facing risks including North Korea and trade; Q1 GDP may exceed forecasts
Asian Equity Indices/Futures (23:30ET)
Nikkei flat, Hang Seng -0.7%, Shanghai Composite -1.0%, ASX200 -0.7%, Kospi -0.5%
Equity Futures: S&P500 +0.1%; Nasdaq +0.1%, Dax flat, FTSE100 -0.2%
FX ranges/Commodities/Fixed Income (23:30ET)
EUR 1.0715-1.0735; JPY 108.38-68; AUD 0.7524-0.7563; NZD 0.7034-0.7052
June Gold -0.4% at 1,289/oz; May Crude Oil -0.2% at $52.31/brl; May Copper +0.9% at $2.55/lb
iShares Silver Trust ETF daily holdings fall to 10,178 tonnes from 10,208 tonnes prior
(US) Weekly API Oil Inventories: Crude: -0.8M v -1.3M prior; 3rd straight draw
(CN) PBOC SETS YUAN MID POINT AT 6.8664 V 6.8849 PRIOR; strongest setting since Apr 13th, first firmer setting in 4 days
(AU) Australia MoF (AOFM) sells A$800M in 2.75% 2027 Bonds; avg yield: 2.5146%; bid-to-cover: 3.24x
Asia equities / Notables
Australia
Oil Search (OSH) -2.8%; (Q1 output)
Brambles (BXB) +4.3% (9-month Rev)
Newcrest (NCM) -1.4% (Cadia mine closed; Cut at Morgans)
Hong Kong
Geely (175) +2.8% (raised at Daiwa)
Top Spring International (3688) -1.5% (contracted sales)
Japan
Toshiba (6502) +1.6% (chip unit bid report from ICJ)
Hakuhodo DY Holdings (2433) +1.3% (FY result speculation)
Mitsubishi Electric (6503) +3.0% (China sales expansion)
