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Writer's pictureSimon Charles Hooper

01/06/23 Briefing


The S&P 500 futures are up 8 points and are trading 0.1% above fair value. The Nasdaq 100 futures are up 11 points and are trading 0.1% above fair value. The Dow Jones Industrial Average futures are down 5 points and are trading slightly below fair value.

Stock futures are mixed this morning. The Dow Jones Industrial Average futures are underperforming due to weakness in Salesforce (CRM) following its earnings report. 

The House passed a 2 year debt ceiling/spending cap bill by a vote of 314-117. The Senate is expected to vote this weekend. 

Also, market participants are reacting to Fed officials signaling that a pause is likely in June, but officials also contend that more increases may be needed. 

There is a large slate of U.S. economic data due out today, yet foreign data featured a stronger than expected Caixin Manufacturing PMI report from China and better than expected inflation data from the eurozone. May CPI was up 6.1% year-over-year versus an expected 6.3% and the prior month's reading of 7.0%.

The 2-yr Treasury note yield is up three basis points to 4.42% and the 10-yr note yield is up two basis points to 3.65%.

Market participants will receive the following economic data today:

  • 8:15 ET: May ADP Employment Change (Briefing.comconsensus 160,000; prior 296,000)

  • 8:30 ET: Weekly initial jobless claims (Briefing.comconsensus 233,000; prior 229,000) and continuing claims (prior 1.794 million); Q1 Productivity Rev. (Briefing.comconsensus -2.7%; prior -2.7%) and Unit Labor Costs Rev. (Briefing.comconsensus 6.3%; prior 6.3%)

  • 9:45 ET: May IHS Markit Manufacturing PMI - Final (prior 48.5)

  • 10:00 ET: May ISM Manufacturing Index (Briefing.comconsensus 47.1; prior 47.1); April Construction Spending (Briefing.comconsensus 0.2%; prior 0.3%)

  • 10:30 ET: Weekly EIA Natural Gas Inventories (prior +96 bcf)

  • 11:00 ET: Weekly EIA Crude Oil Inventories (prior -12.46M)

In corporate news:

  • Salesforce (CRM 209.40, -13.98, -6.3%): beats by $0.08, reports revs in-line; guides Q2 EPS above consensus, revs above consensus; guides FY24 EPS above consensus, reaffirms FY24 revs guidance

  • CrowdStrike (CRWD 144.00, -16.13, -10.1%): beats by $0.06, beats on revs; guides Q2 EPS and revs midpoints above consensus; guides FY24 EPS above consensus, revs above consensus

  • C3.ai (AI 32.83, -7.19, -18.0%): beats by $0.04, beats on revs; guides Q1 revs in-line; guides FY24 revs in-line

  • Okta (OKTA 73.38, -17.52, -19.3%): beats by $0.10, beats on revs; guides Q2 EPS above consensus, revs above consensus; guides FY24 EPS above consensus, revs in-line; CEO says macro pressures are increasing

  • Nordstrom (JWN 15.84, +0.54, +3.5%): beats by $0.17, beats on revs; reaffirms FY24 EPS guidance, revs guidance

  • Macy's (M 12.31, -1.28, -9.4%): beats by $0.11, reports revs in-line; guides FY24 EPS below consensus, revs below consensus

  • Dollar General (DG 182.88, -18.21, -9.1%): misses by $0.04, misses on revs; guides FY24 EPS below consensus, revs below consensus

  • Veeva Systems (VEEV 181.60, +15.90, +9.6%): beats by $0.12, beats on revs; guides Q2 EPS above consensus, revs in-line; guides FY24 EPS above consensus, revs in-line

  • Chewy (CHWY 34.39, +4.90, +16.6%): beats by $0.24, beats on revs; sees Q2 guidance above consensus; raises FY23 revs outlook

  • NetApp (NTAP 70.00, +3.65, +5.5%): beats by $0.19, beats on revs; guides Q1 EPS below consensus, revs in-line; guides FY24 EPS above consensus, revs inline, also announces new share repurchase authorization of an additional $1 bln

  • Target (TGT 129.00, -1.93, -1.5%): downgraded to Neutral from Overweight at JPMorgan

  • Chevron (CVX 151.93, +1.31, +0.9%): upgraded to Outperform from Sector Perform at RBC Capital Markets

  • Lucid Group (LCID 6.68, -1.09, -14.1%): commences public offering of 173,544,948 shares of its common stock and corresponding investment by an affiliate of PIF for aggregate expected gross proceeds of approximately $3.0 billion

Reviewing overnight developments:

  • Equity indices in the Asia-Pacific region ended Thursday on a mixed note. Japan's Nikkei: +0.8%, Hong Kong's Hang Seng: -0.1%, China's Shanghai Composite: UNCH, India's Sensex: -0.3%, South Korea's Kospi: -0.3%, Australia's ASX All Ordinaries: +0.2%.

    • In economic data:

      • China's May Caixin Manufacturing PMI 50.9 (expected 50.3; last 49.5)

      • Japan's Q1 Capital Spending 11.0% yr/yr (expected 5.5%; last 7.7%) and May Manufacturing PMI 50.6 (expected 50.8; last 49.5)

      • South Korea's May Manufacturing PMI 48.4 (expected 48.8; last 48.1) and May trade deficit $2.10 bln (expected deficit of $2.89 bln; last deficit of $2.65 bln). May Imports -14.0% yr/yr (expected -10.6%; last -13.3%) and Exports -15.2% yr/yr (expected -13.5%; last -14.3%)

      • Australia's May Manufacturing PMI 48.4 (expected 48.0; last 48.0). Q1 Building Capital Expenditure 1.3% qtr/qtr (expected 8.4%; last 3.6%), Q1 Private New Capital Expenditure 2.4% qtr/qtr (expected 1.3%; last 3.0%). April Retail Sales 0.0% m/m, as expected (last 0.4%)

      • India's May Manufacturing PMI 58.7 (expected 56.5; last 57.2)

      • Hong Kong's April Retail Sales 15.0% yr/yr (expected 37.9%; last 40.9%)

    • In news:

      • China's Caixin Manufacturing PMI returned into expansion in the May reading while Australia's Manufacturing PMI remained below 50.0 for the third month in a row.

      • Japan's Manufacturing PMI returned into expansion for the first time in seven months.

      • U.S. Defense Secretary Austin said that improved communication with China would help avoid the potential for incidents "spiraling out of control."

      • IMF Chief Economist Gourinchas said that it is too early to begin tightening policy for the Bank of Japan.

  • Major European indices trade in the green. STOXX Europe 600: +0.7%, Germany's DAX: +1.1%, U.K.'s FTSE 100: +0.3%, France's CAC 40: +0.6%, Italy's FTSE MIB: +1.7%, Spain's IBEX 35: +1.2%.

    • In economic data:

      • Eurozone's May CPI 0.0% m/m (expected 0.6%; last 0.6%); 6.1% yr/yr (expected 6.3%; last 7.0%). May Core CPI 0.2% m/m (expected 0.8%; last 1.0%); 5.3% yr/yr (expected 5.5%; last 5.6%). April Unemployment Rate 6.5%, as expected (last 6.6%). May Manufacturing PMI 44.8 (expected 44.6; last 45.8)

      • Germany's May Manufacturing PMI 43.2 (expected 42.9; last 44.5) and April Retail Sales 0.8% m/m (expected 1.0%; last -2.4%); -4.3% yr/yr (expected -5.0%; last -8.6%)

      • U.K.'s May Manufacturing PMI 47.1 (expected 46.9; last 47.8). April Retail Sales 15.0% yr/yr (expected 37.9%; last 40.9%). April Mortgage Lending -GBP1.38 bln (expected GBP1.25 bln; last -GBP10 mln). May Nationwide HPI -0.1% m/m (expected -0.5%; last 0.4%); -3.4% yr/yr (last -2.7%)

      • France's May Manufacturing PMI 45.7 (expected 46.1; last 45.6) and April government budget deficit EUR83.70 bln (last deficit of EUR54.70 bln)

      • Italy's May Manufacturing PMI 45.9 (expected 45.8; last 46.8). April Unemployment Rate 7.8%, as expected (last 7.9%)

      • Spain's May Manufacturing PMI 48.4 (expected 47.8; last 49.0)\

      • Swiss May procure.chPMI 43.2 (expected 44.5; last 45.3). April trade surplus CHF2.601 bln (expected surplus of CHF3.730 bln; last surplus of CHF4.526 bln)

    • In news:

      • Eurozone's May CPI was a bit below expectations, helping the yr/yr rate slow to a 14-month low of 6.1% from 7.0% in April.

      • European Central Bank policymaker de Guindos said that 25-bps rate hikes represent "the new normal."

      • Italy will form a EUR1 bln sovereign fund for companies with strategic importance.

      • Swiss National Bank President Jordan said that rising rates would not threaten Swiss financial stability.

 

U.S. equity futures:

  • S&P 500 Futures: +8 @ 4,188

  • DJIA Futures: +7 @ 32,915

  • Nasdaq 100 Futures: +18 @ 14,273

Overseas:

  • Europe: DAX +1.1%, FTSE +0.3%, CAC +0.6%

  • Asia: Nikkei +0.8%, Hang Seng -0.1%, Shanghai Composite UNCH

Commodities:

  • Crude Oil -0.21 @ 67.88

  • Nat Gas -0.011 @ 2.255

  • Gold +2.70 @ 1984.80

  • Silver +0.026 @ 23.613

  • Copper +0.0820 @ 3.719


 

Earnings/Guidance:

  • Bilibili (BILI) beats by RMB0.31, misses on revs; reaffirms FY23 revs guidance

  • Bitfarms (BITF) announces total BTC mined of 459 in May, +6.5% yr/yr

  • Buckle (BKE) reports May comparable store net sales -6.4% yr/yr

  • C3.ai (AI) beats by $0.04, beats on revs; guides Q1 revs in-line; guides FY24 revs in-line

  • Caleres (CAL) beats by $0.03, misses on revs; guides Q2 EPS below consensus; guides FY24 EPS in-line

  • Chewy (CHWY) beats by $0.24, beats on revs; sees Q2 guidance above consensus; raises FY23 revs outlook

  • Conn's (CONN) misses by $0.19, misses on revs

  • Credo Technology Group (CRDO) reports EPS in-line, beats on revs; guides Q1 revs above consensus

  • CrowdStrike (CRWD) beats by $0.06, beats on revs; guides Q2 EPS and revs midpoints above consensus; guides FY24 EPS above consensus, revs above consensus

  • Descartes (DSGX) beats by $0.01, beats on revs

  • Dollar General (DG) misses by $0.04, misses on revs; guides FY24 EPS below consensus, revs below consensus

  • Hormel Foods (HRL) beats by $0.01, misses on revs; reaffirms FY23 EPS guidance, revs guidance

  • Macy's (M) beats by $0.11, reports revs in-line; guides FY24 EPS below consensus, revs below consensus

  • nCino (NCNO) beats by $0.02, reports revs in-line; guides Q2 EPS in-line, revs below consensus; guides FY24 EPS in-line, revs below consensus

  • NetApp (NTAP) beats by $0.19, beats on revs; guides Q1 EPS below consensus, revs in-line; guides FY24 EPS above consensus, revs inline, also announces new share repurchase authorization of an additional $1 bln

  • Nordstrom (JWN) beats by $0.17, beats on revs; reaffirms FY24 EPS guidance, revs guidance

  • Okta (OKTA) beats by $0.10, beats on revs; guides Q2 EPS above consensus, revs above consensus; guides FY24 EPS above consensus, revs in-line

  • Phreesia (PHR) beats by $0.05, beats on revs; reaffirms FY24 revs guidance; reaffirms FY25 revs guidance

  • Pure Storage (PSTG) beats by $0.04, beats on revs; guides Q2 revs above consensus

  • PVH (PVH) beats by $0.20, beats on revs

  • Salesforce (CRM) beats by $0.08, reports revs in-line; guides Q2 EPS above consensus, revs above consensus; guides FY24 EPS above consensus, reaffirms FY24 revs guidance

  • SpartanNash (SPTN) beats by $0.05, misses on revs; reaffirms FY23 EPS guidance, revs guidance

  • Veeva Systems (VEEV) beats by $0.12, beats on revs; guides Q2 EPS above consensus, revs in-line; guides FY24 EPS above consensus, revs in-line

  • Victoria's Secret (VSCO) misses by $0.26, reports revs in-line; guides Q2 EPS, revs below consensus; guides FY24 revs below consensus

News:

  • House passes 2 year debt ceiling/spending cap bill by a vote of 314-117; Senate is expected to vote this weekend

  • Fed officials signal pause in June, but rate hike later in the summer, according to the Wall Street Journal

  • Macau Gaming Inspection and Coordination Bureau reported May gross revs 366% yr/yr to HKD 15.6 bln versus -68.0% in May of 2022

  • Alphabet (GOOG): Google is investing in AI startup Runway to wrest cloud business from AWS, according to TheInformation

  • Altair Engineering (ALTR) expands share buyback authorization from $50 mln to $75 mln

  • Amarin's (AMRN) commercial partner in China, EddingPharm, has received regulatory approval for VASCEPA

  • AstraZeneca (AZN) and Merck (MRK)'s Lynparza plus abiraterone approved in the US for the treatment of BRCA-mutated metastatic castration-resistant prostate cancer

  • Bausch + Lomb (BLCO) announced a reshaping of its executive leadership team, including the elevation of all business unit heads

  • BHP Group (BHP) has identified issues with certain allowances and entitlements affecting a number of its current and former employees in Australia

  • Bio-Techne (TECH) successful on claim of reverse engineering by Miltenyi Biotec

  • Cellectis (CLLS) Publishes an Article in Cancer Immunology Research Demonstrating Preclinical Evidence of UCART20x22 Product Candidate to Target a Broad Spectrum of Patients with B-cell Malignancies

  • Chemours (CC) Officially Launches Operations as Part of Joint Venture with BWT and FUMATECH, Meeting Demand in Mobility Applications Critical to Global, Sustainable Hydrogen Economy

  • Credit Suisse (CS) has paid back government liquidity, according to Reuters

  • Cronos Group (CRON) announces decision to streamline its operating structure by winding down and exiting its existing U.S. hemp-derived CBD-focused operations

  • CrowdStrike (CRWD) announces that it has been granted an Impact Level 5 Provisional Authorization from the United States Department of Defense

  • Daseke (DSKE) appointed Scott Hoppe as Executive Vice President and Chief Operating Officer, effective June 1, 2023

  • Exxon (XOM) and Chevron (CVX) shareholders reject climate change measures, according to the Wall Street Journal

  • Ford Motor (F) recalling 2015-2019 Lincoln MKCs on potential fire concern, according to Bloomberg

  • Ford Motor (F) Next is collaborating with Uber (UBER) to deliver a new lease option for rideshare drivers going electric

  • Hannon Armstrong Sust. Infr. (HASI) upsizes revolving credit facility to $840 mln

  • Intl Game Tech. PLC (IGT) signs eight year contract with Connecticut Lottery Corporation to deploy its iLottery gaming system

  • Ionis Pharma (IONS) announces positive donidalorsen late-stage clinical progress in HAE

  • Kinder Morgan (KMI) announces plan to expand working gas storage capacity at its Markham Storage facility in Matagorda County

  • Li Auto (LI) May 2023 delivery update

  • Meta Platforms' (META) Andy Stone says that the company might remove news from California if proposed bill passes

  • MSA Safety (MSA) names Steve Blanco as President and COO

  • NIO (NIO) provides May 2023 delivery update

  • Novartis AG (NVS): Sandoz plans move to new central Basel headquarters by mid-2024, following proposed spin-off as standalone company

  • Obsidian Energy (OBE) increases syndicated credit facility and provides an update on both the results of our first half 2023 Viking drilling program

  • Outbrain (OB) announces a reduction in its global workforce of approximately 10%

  • Petrobras (PBR) approved the revision of the strategic elements for the 2024-2028 Strategic Plan

  • Pfizer (PFE): U.S. FDA Approves ABRYSVO, Pfizer's Vaccine for the Prevention of Respiratory Syncytial Virus (RSV) in Older Adults

  • Quipt Home Medical (QIPT) has terminated its previously announced 'at-the-market' equity program put in place pursuant to an equity distribution agreement dated May 15, 2023 by and among the Company, Canaccord Genuity and Beacon ?Securities Limited

  • Redfin (RDFN) reports that investor home purchases fell by a record 49% yr/yr in Q1, outpacing a 41% drop in overall home purchases

  • Rocket Lab USA (RKLB) signs deal to launch the LEO 3 satellite for satellite operator Telesat (TSAT)

  • Scorpio Tankers (STNG) announces repurchases of its common shares and replenishes its 2023 securities repurchase program

  • Solid Power (SLDP) announces that John Van Scoter has been appointed President and CEO, effective June 14, 2023

  • Takeda Pharma (TAK) withdraws the Shelf Registration Statement regarding the issuance of new shares filed on June 1, 2022

  • TELUS International (TIXT) appointed Jose-Luis Garcia as the company's Chief Operating Officer effective today

  • Tesla (TSLA) CEO Elon Musk meets with Chinese Vice Premier Ding, according to Reuters

  • Vale S.A. (VALE) informs the Samarco's judicial reorganization plan

  • Vanda Pharma (VNDA) gets orphan designation for Treatment of Charcot-Marie-Tooth disease, according to FDA website

  • Walmart (WMT) raising wages, investing in careers for more than 7,000 opticians and pharmacists

  • XPeng (XPEV) announces vehicle delivery results for May 2023

  • ZipRecruiter (ZIP) announces plans to reduce global headcount by approx. 270 employees; reaffirms guidance

M&A:

  • Brookfield Infrastructure (BIP) and DigitalBridge Group (DBRG) are in bidding war to acquire Compass Datacenters, according to Reuters

  • Cibus Global (CBUS) and Calyxt (CLXT) announce merger has closed

  • Constellation Energy (CEG) to acquire ownership stake in Texas Nuclear Plant From NRG Energy (NRG)

  • DHT (DHT) announces acquisition of 2018 built VLCC at Hyundai Heavy Industries for $94.5 million

  • Highwoods Prop (HIW) announces non-core asset sales of $40.2 mln, including sale of One Independence Park for $19.5 mln

  • MACOM Tech (MTSI) completes acquisition of manufacturing facilities near Paris, France

  • Stanley Black & Decker (SWK) exploring a sale of unit that makes excavator buckets, according to Bloomberg

  • U.S. Physical Therapy (USPH) announces acquisition of physical therapy practice with four clinics; the business currently generates approximately $2.6 mln in annual revenue

Syndicate:

  • Alamos (AGI) files for $500 mln mixed securities shelf offering

  • Kimbell Royalty Partners (KRP) files for 5,926,520 common unit offering by selling shareholders

  • Lucid Group (LCID) commences public offering of 173,544,948 shares of its common stock and corresponding investment by an affiliate of PIF for aggregate expected gross proceeds of approximately $3.0 billion

  • Oculis Holding AG (OCS) announced the pricing of a follow-on public offering of 3,500,000 ordinary shares at a public offering price of $11.50 per ordinary share, for gross proceeds of $40.25 million

IPOs:

  • Expected to Price: No IPOs expected.

Gapping Up/Down

  • Gapping up:

    • CHWY +18%, VEEV +9.3%, JWN +7.2%, MSA +5%, PSTG +5%, NTAP +4.9%, OB +4.8%, CLLS +4.2%, AMRN +3.4%, BILI +3.4%, KRP +2%, SLDP +1.8%, ZIP +1.3%, CRDO +1.3%, HRL +1.2%

  • Gapping down:

    • AI -21.2%, OKTA -20%, LXRX -15.5%, VSCO -14.7%, CRWD -10.5%, LCID -10.4%, NCNO -7.7%, CONN-6.2%, CRM -5.5%, CRON -5.1%, BDSX -3.6%, OCS-2%, NIO -2%, PVH -1.5%, CAL -1.5%

 

Analyst Research (see Upgrades/Downgradescalendarfor full list):

  • Upgrades

    • Alteryx (AYX) upgraded to Buy from Neutral at BofA Securities; tgt raised to $70

    • BRF SA (BRFS) upgraded to Neutral from Underperform at BofA Securities

    • Chevron (CVX) upgraded to Outperform from Sector Perform at RBC Capital Mkts; tgt raised to $180

    • CSX (CSX) upgraded to Buy from Neutral at UBS; tgt raised to $37

    • Domino's Pizza (DPZ) upgraded to Overweight from Neutral at JP Morgan; tgt raised to $360

    • Intercorp Financial (IFS) upgraded to Overweight from Neutral at JP Morgan; tgt $27

    • MDU Resources (MDU) upgraded to Buy from Underperform at BofA Securities; tgt $22

  • Downgrades:

    • Adicet Bio (ACET) downgraded to Neutral from Overweight at JP Morgan; tgt lowered to $6

    • Sphere Entertainment Co. (SPHR) downgraded to Neutral from Outperform at Macquarie; tgt $25

  • Others:

    • ASGN Incorporated (ASGN) initiated with a Buy at UBS; tgt $80

    • Bright Horizons (BFAM) initiated with a Sell at UBS; tgt $79

    • Cintas (CTAS) initiated with a Buy at UBS; tgt $550

    • INmune Bio (INMB) initiated with an Outperform at Robert W. Baird; tgt $16

    • Robert Half (RHI) initiated with a Buy at UBS; tgt $82

    • Rollins (ROL) initiated with a Buy at UBS; tgt $48

Econ Data:

  • 08:15 ET: ADP Employment Change for May (Briefing.comConsensus 160K; Prior 296K)

  • 08:30 ET: Initial Claims for May 27 (Briefing.comConsensus 233K; Prior 229K)

  • 08:30 ET: Continuing Claims for May 20 (Briefing.comConsensus NA; Prior 1794K)

  • 08:30 ET: Productivity-Rev. for Q1 (Briefing.comConsensus -2.7%; Prior -2.7%)

  • 08:30 ET: Unit Labor Costs-Rev. for Q1 (Briefing.comConsensus 6.3%; Prior 6.3%)

  • 09:45 ET: IHS Markit Manufacturing PMI - Final for May (Briefing.comConsensus NA; Prior 48.5)

  • 10:00 ET: ISM Manufacturing Index for May (Briefing.comConsensus 47.1; Prior 47.1)

  • 10:00 ET: Construction Spending for Apr (Briefing.comConsensus 0.2%; Prior 0.3%)

  • 10:30 ET: EIA Natural Gas Inventories for May 27 (Briefing.comConsensus NA; Prior +96 bcf)

  • 11:00 ET: EIA Crude Oil Inventories for May 27 (Briefing.comConsensus NA; Prior -12.46M)

Earnings:

  • Tuesday (May 30)

    • Morning: SKY

    • Afternoon:  AMBA BOX HPE HPQ SPWH

  • Wednesday (May 31)

    • Morning:  AAP CAE CPRI DCI FRO

    • Afternoon:  AI CHWY CRDO CRWD DSGX NCNO NTAP JWN OKTA PHR PSTG PVH CRM VEEV VSCO

  • Thursday (Jun 1)

    • Morning: BILI CAL CONN DG HRL M SPTN

    • Afternoon:  ASAN AVGO CHPT COO DELL ESTC FIVE GWRE LULU MDB PD S VMW ZS ZUMZ

 

Asia & Europe detail:

Asia: Nikkei +0.8%, Hang Seng -0.1%, Shanghai Composite UNCH

Equity indices in the Asia-Pacific region ended Thursday on a mixed note. China's Caixin Manufacturing PMI returned into expansion in the May reading while Australia's Manufacturing PMI remained below 50.0 for the third month in a row. Japan's Manufacturing PMI returned into expansion for the first time in seven months. U.S. Defense Secretary Austin said that improved communication with China would help avoid the potential for incidents "spiraling out of control." IMF Chief Economist Gourinchas said that it is too early to begin tightening policy for the Bank of Japan.

  • In economic data:

    • China's May Caixin Manufacturing PMI 50.9 (expected 50.3; last 49.5)

    • Japan's Q1 Capital Spending 11.0% yr/yr (expected 5.5%; last 7.7%) and May Manufacturing PMI 50.6 (expected 50.8; last 49.5)

    • South Korea's May Manufacturing PMI 48.4 (expected 48.8; last 48.1) and May trade deficit $2.10 bln (expected deficit of $2.89 bln; last deficit of $2.65 bln). May Imports -14.0% yr/yr (expected -10.6%; last -13.3%) and Exports -15.2% yr/yr (expected -13.5%; last -14.3%)

    • Australia's May Manufacturing PMI 48.4 (expected 48.0; last 48.0). Q1 Building Capital Expenditure 1.3% qtr/qtr (expected 8.4%; last 3.6%), Q1 Private New Capital Expenditure 2.4% qtr/qtr (expected 1.3%; last 3.0%). April Retail Sales 0.0% m/m, as expected (last 0.4%)

    • India's May Manufacturing PMI 58.7 (expected 56.5; last 57.2)

    • Hong Kong's April Retail Sales 15.0% yr/yr (expected 37.9%; last 40.9%)

---Equity Markets---

  • Japan's Nikkei: +0.8%

  • Hong Kong's Hang Seng: -0.1%

  • China's Shanghai Composite: UNCH

  • India's Sensex: -0.3%

  • South Korea's Kospi: -0.3%

  • Australia's ASX All Ordinaries: +0.2%

---FX---

  • USD/JPY: +0.2% to 139.56

  • USD/CNH: +0.1% to 7.1209

  • USD/INR: -0.3% to 82.36

 

Europe: DAX +1.1%, FTSE +0.3%, CAC +0.6%

Major European indices trade in the green. Eurozone's May CPI was a bit below expectations, helping the yr/yr rate slow to a 14-month low of 6.1% from 7.0% in April. European Central Bank policymaker de Guindos said that 25-bps rate hikes represent "the new normal." Italy will form a EUR1 bln sovereign fund for companies with strategic importance. Swiss National Bank President Jordan said that rising rates would not threaten Swiss financial stability.

  • In economic data:

    • Eurozone's May CPI 0.0% m/m (expected 0.6%; last 0.6%); 6.1% yr/yr (expected 6.3%; last 7.0%). May Core CPI 0.2% m/m (expected 0.8%; last 1.0%); 5.3% yr/yr (expected 5.5%; last 5.6%). April Unemployment Rate 6.5%, as expected (last 6.6%). May Manufacturing PMI 44.8 (expected 44.6; last 45.8)

    • Germany's May Manufacturing PMI 43.2 (expected 42.9; last 44.5) and April Retail Sales 0.8% m/m (expected 1.0%; last -2.4%); -4.3% yr/yr (expected -5.0%; last -8.6%)

    • U.K.'s May Manufacturing PMI 47.1 (expected 46.9; last 47.8). April Retail Sales 15.0% yr/yr (expected 37.9%; last 40.9%). April Mortgage Lending -GBP1.38 bln (expected GBP1.25 bln; last -GBP10 mln). May Nationwide HPI -0.1% m/m (expected -0.5%; last 0.4%); -3.4% yr/yr (last -2.7%)

    • France's May Manufacturing PMI 45.7 (expected 46.1; last 45.6) and April government budget deficit EUR83.70 bln (last deficit of EUR54.70 bln)

    • Italy's May Manufacturing PMI 45.9 (expected 45.8; last 46.8). April Unemployment Rate 7.8%, as expected (last 7.9%)

    • Spain's May Manufacturing PMI 48.4 (expected 47.8; last 49.0)

    • Swiss May procure.chPMI 43.2 (expected 44.5; last 45.3). April trade surplus CHF2.601 bln (expected surplus of CHF3.730 bln; last surplus of CHF4.526 bln)

---Equity Markets---

  • STOXX Europe 600: +0.7%

  • Germany's DAX: +1.1%

  • U.K.'s FTSE 100: +0.3%

  • France's CAC 40: +0.6%

  • Italy's FTSE MIB: +1.7%

  • Spain's IBEX 35: +1.2%

---FX---

  • EUR/USD: +0.3% to 1.0713

  • GBP/USD: +0.3% to 1.2470

  • USD/CHF: -0.2% to 0.9078

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