It has been a banner day for US stocks, particularly in the technology sector. The NASDAQ closed at a new all-time high while the S&P 500 touched a new intraday before slipping back into the close. Yesterday’s earnings reports weren’t all that great overall but traders appear to have decided to focus more on a weaker than expected US flash PMI report for April which suggests that the economy hasn’t roared out of winter like last year. This pretty much put the final nail in the coffin of a June interest rate hike and probably July as well, sending USD lower and underpinning stocks. The NASDAQ has continued to trend higher after US exchanges closed for the day. MicroSoft posted very strong earnings while Google had a near miss. Note that should if the USD were to continue to backslide, it could take some of the pressure off of US earnings and improve the outlook for impacted sectors, particularly technology. The USD retreat also ignited a rally in crude oil markets today. Brent crude broke out of a base while WTI crude completed a retest of its recent breakout point to confirm the start of a recovery bounce in both markets. Saudi Arabia getting back into Yemen so quickly after pulling out also appears to have rattled some, but so far the impact has been more pronounced in oil than in haven plays like gold. Heading into the weekend two big questions could still influence trading. First, can US indices follow through on today’s breakouts and continue to climb, or is this another head fake? Second, what could be the impact of Greece on trading this week. Last week, European indices fell off sharply on fears of a weekend Grexit but this week there have been rumours that a deal could be close, so we’ll see. Continental currencies staged a strong rebound, particularly EUR and CHF, while the Dax was weak so sentiment appears mixed on the matter. Except for Singapore, there’s no major economic data due today for Asia Pacific countries, but we may see traders continue to react to yesterday’s PMI figures from China and Japan and momentum from today’s moves in US stock and energy markets. Corporate News Google $6.57 vs street $6.61, revenue $13.9B vs street $14.0B MicroSoft $0.61 vs street $0.51, revenue $21.7B vs stret $21.0B Amazon.com ($0.12) vs street ($0.14) Economic News Significant announcements released overnight include: US flash manufacturing PMI 54.2 vs street 55.7 US new home sales 481K vs street 515K US natural gas 90 BCF vs street 84 BCF US jobless claims 295K vs street 287K UK retail sales street 5.4% UK retail ex auto street 5.5% Germany flash manufacturing PMI street 53.0 Germany flash service PMI street 55.5 France flash manufacturing PMI street 49.2 France flash service PMI street 52.4 Eurozone flash manufacturing PMI street 52.2 Eurozone flash service PMI street 54.2 Upcoming significant announcements include: 3:00 pm AEDT Singapore industrial production street 0.8% 9:00 am BST Germany IFO business climate street 108.4 9:00 am BST Germany IFO current assessment street 112.4 9:00 am BST Germany IFO expectations street 104.5 8:30 am EDT US durable goods orders street 0.6% 8:30 am EDT US durables ex transport street 0.3% 1:00 pm EDT US Baker Hughes drill rig count previous 954
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