Stock Market Update

The S&P 500 futures are down 20 points and are trading 0.3% below fair value, the Nasdaq 100 futures are down 110 points and are trading 0.6% below fair value, and the Dow Jones Industrial Average futures are up 41 points and are trading 0.1% above fair value.

Early trading indicates a mixed open after another big batch of earnings. Investors are still waiting on results from influential names like Microsoft (MSFT) and Meta Platforms (META) after the close, and Apple (AAPL) and Amazon.com (AMZN) after Thursday's close.

Market participants are also waiting on potentially market-moving data this morning. The first look at Q1 GDP is released at 8:30 ET and the March Personal Income and Spending Report, which features the Fed's preferred inflation reading (i.e. core-PCE Price Index), is released at 10:00 ET.

There's some early buying interest in Treasuries. The 10-yr yield is down two basis points to 4.15% and the 2-yr yield is down one basis point to 3.65%.

In corporate news:

• Visa (V 342.80, +1.28, +0.4%): beats by $0.08, reports revs in-line; announces buyback
• Booking Holdings (BKNG 29.91, -6.09, -16.8%): beats by $7.47, beats on revs; currently expects Q2 room night growth to be between 4% and 6%, expects Q2 gross bookings to increase between 10 and 12%
• Starbucks (SBUX 77.40, -7.45, -8.8%): misses by $0.08, reports revs in-line, global comparable store sales declined 1%; declines to provide Q3 (Jun) guidance but says it expects Q3 to follow normal seasonality
• Mondelez Int'l (MDLZ 66.45, +0.80, +1.2%): beats by $0.10, reports revs in-line; reaffirms FY25 EPS guidance
• Snap (SNAP 7.78, -1.31, -14.4%): beats by $0.05, beats on revs
• Humana (HUM 271.00, +11.64, +4.5%): beats by $1.51, reports revs in-line; guides FY25 EPS below consensus
• Caterpillar (CAT 315.00, +7.60, +2.5%): misses by $0.10, misses on revs

Reviewing overnight developments:

• Equity indices in the Asia-Pacific region had a mixed showing on Wednesday. Japan's Nikkei: +0.6%, Hong Kong's Hang Seng: +0.5%, China's Shanghai Composite: -0.2%, India's Sensex: -0.1%, South Korea's Kospi: -0.3%, Australia's ASX All Ordinaries: +0.6%.
  • In economic data:
    • China's April Manufacturing PMI 49.0 (expected 49.8; last 50.5). April Non-Manufacturing PMI 50.4 (expected 50.7; last 50.8). April Caixin Manufacturing PMI 50.4 (expected 49.9; last 51.2)
    • Japan's March Industrial Production (prelim) -1.1% m/m (expected -0.5%; last +2.3%). March Retail Sales +3.1% yr/yr (expected +3.6%; last +1.3%). March Large Retailers' Sales -1.2% m/m (last +0.4%); +3.0% yr/yr (last +2.0%)
    • South Korea's March Industrial Production +2.9% m/m (expected +0.2%; last +1.4%); +5.3% yr/yr (expected +3.3%; last +7.1%). March Retail Sales -0.3% m/m (last +1.9%). March Service Sector Output -0.3% m/m (last +0.5%)
    • Singapore's March Bank Lending SGD 846.5B (last SGD 841.1B)
    • Australia's Q1 CPI +0.9% q/q (expected +0.8%; last +0.2%); +2.4% yr/yr (expected +2.3%; last +2.4%). March Private Sector Credit +0.5% m/m, as expected (last +0.5%). March Housing Credit +0.5% m/m (last +0.4%)
    • New Zealand's April ANZ Business Confidence 49.3 (last 57.5). April NBNZ Own Activity 47.7% (last 48.6%)
  • In news:
    • April PMI readings from China showed a deceleration in activity in both sectors with the official Manufacturing PMI (49.0) dipping into contractionary territory and reaching its lowest level since December 2023.
    • The Bank of Japan will release its initial projections for 2027 tomorrow.
    • Australia's Treasurer Chalmers said that he expects more rate cuts after today's release of CPI for Q1.
    • Markets in China, Hong Kong, South Korea, and India will be closed for Labor Day tomorrow.
• Major European indices are mostly higher after the flash reading of the eurozone's Q1 GDP (0.4% qtr/qtr; expected 0.2%) beat expectations. STOXX Europe 600: +0.5%, Germany's DAX: +0.5%, U.K.'s FTSE 100: +0.2%, France's CAC 40: +0.7%, Italy's FTSE MIB: -0.4%, Spain's IBEX 35: -1.1%.
  • In economic data:
    • Eurozone's flash Q1 GDP 0.4% qtr/qtr (expected 0.2%; last 0.2%); 1.2% yr/yr (expected 1.0%; last 1.2%)
    • Germany's March Import Prices -1.0% m/m (exp -0.7%; last +0.3%); +2.1% yr/yr (last +3.6%). March Retail Sales -0.2% m/m (exp -0.4%; last +0.2%); +2.2% yr/yr (last 0.0%). Q1 GDP +0.2% q/q (exp +0.2%; last -0.2%); -0.2% yr/yr (exp -0.2%; last -0.2%). April Unemployment Change +4K (exp +16K; last +26K). April Unemployment Rate 6.3%, as expected (last 6.3%)
    • U.K.'s April Nationwide HPI -0.6% m/m (exp -0.1%; last 0.0%); +3.4% yr/yr (exp +4.1%; last +3.9%)
    • France's March Consumer Spending -1.0% m/m (exp 0.0%; last -0.2%). Q1 GDP +0.1% q/q (exp +0.1%; last -0.1%); +0.8% yr/yr (exp +0.7%; last +0.8%). April CPI +0.5% m/m (exp +0.4%; last +0.2%); +0.8% yr/yr (exp +0.8%; last +0.8%)
    • Italy's Q1 GDP +0.3% q/q (exp +0.2%; last +0.2%); +0.6% yr/yr (last +0.5%). April CPI 0.2% m/m, as expected (last 0.3%); 2.0% yr/yr, as expected (last 1.9%). March PPI -2.4% m/m (last 0.7%); 3.9% yr/yr (last 6.2%)
    • Swiss April KOF Leading Indicators 97.1 (exp 101.8; last 103.2). April ZEW Expectations -51.6 (last -10.7)
  • In news:
    • Corporate earnings were varied with Barclays reporting strong profits, while automakers such as Mercedes-Benz withdrew guidance citing trade uncertainty, a concern UBS Group echoed yesterday calling the outlook "particularly unpredictable."
    • While China signaled it may lift sanctions on EU lawmakers to foster trade talks, investors continue to balance tentative trade optimism against ongoing economic headwinds.