Stock Market Update

The S&P 500 futures currently trade 25 points below fair value.

Equity indices in the Asia-Pacific region began the week on a higher note even though the conflict with Iran escalated over the weekend, as Iran's navy continued restricting traffic through the Strait of Hormuz over the weekend. A U.S. delegation was expected to meet with Iranian officials in Pakistan today, but Iran has not committed to another round of negotiations yet. Tokyo Steel announced that its price hikes will continue into May while other Japanese companies are also expected to increase prices. The approval rating of Prime Minister Takaichi's cabinet fell to 66% from 71%. The People's Bank of China left its one-year and five-year loan prime rates at their respective 3.00% and 3.50%.

• In economic data:
  • Japan's February Tertiary Industry Activity Index -0.7 (last -8.7)
  • New Zealand's March trade surplus NZD698 mln (expected surplus of NZD175 mln; last deficit of NZD365 mln)

---Equity Markets---

• Japan's Nikkei: +0.6%
• Hong Kong's Hang Seng: +0.8%
• China's Shanghai Composite: +0.8%
• India's Sensex: UNCH
• South Korea's Kospi: +0.4%
• Australia's ASX All Ordinaries: +0.1%

Major European indices trade in the red, weighed down by news that maritime traffic is still not flowing through the Strait of Hormuz. European Central Bank policymaker Demarco said that the central bank should wait a bit longer before raising rates, adding that bets on two rate hikes are not unreasonable. Moody's lowered Belgium's rating to A1 from Aa3, revising the outlook to Stable from Negative while DBRS reaffirmed Italy's A rating with a Stable trend.

• In economic data:
  • Eurozone's February Construction Output -1.9% m/m (last -1.33%)
  • Germany's March PPI 2.5% m/m (expected 1.4%; last -0.5%); -0.2% yr/yr (last -3.3%)

---Equity Markets---

• STOXX Europe 600: -1.1%
• Germany's DAX: -1.4%
• U.K.'s FTSE 100: -0.7%
• France's CAC 40: -1.2%
• Italy's FTSE MIB: -1.4% 
• Spain's IBEX 35: -1.4%