North American traders appear to be returning from a long weekend in a good mood with both US stocks and USD in rally mode. US index futures are up 0.25% so far with the FTSE
flat and the Dax up 0.5%. Positive flash manufacturing reports for France and Germany overnight have boosted continental stocks a bit.
US traders appear to be responding favourably to the first retailer earning which has seen Home Depot come in very strong, beating the street by a wide margin and announcing an eye catching 29% dividend increase. Wal-Mart beat the street by a smaller margin and announced a more modest 2% dividend increase. Struggling Macy's is scheduled to report later this morning. Kraft Heinz may also be active again as its plan to bid for Unilever collapsed over the weekend.
Resource stocks particularly energy companies and base metal miners, may also attract attention from traders with commodity prices rallying today. WTI crude oil and copper are both up 1.5% today.
Gold stocks, on the other hand, could struggle today with the yellow metal down 0.6% and Silver down 0.8%. The USD is outperforming ahead of today's Fed member speeches with Philadelphia Fed President Harker having suggested over the weekend the potential for a rate hike in March. GBP is down against USD but up against EUR and JPY as the House of Lords continues debate on the Brexit bill.
Home Depot $1.44 vs street $1.33, sales $22.2B vs street $21 8B, same store sales 4.6%, 29% dividend increase, guides next year EPS to $7.13 just under street $7.16
Wal-Mart $1.30 vs street $1.28, same store sales 1.0%, 2.0% dividend increase
France flash manufacturing PMI 52.3 vs street 53.5
France flash service PMI 56.7 vs street 53.9
Germany flash manufacturing PMI 57.0 vs street 56.0
Germany flash service PMI 54.4 vs street 53.6
Japan flash manufacturing PMI 53.5 vs previous 52.7
Upcoming significant economic announcements include:
9:45 am EST US Markit flash manufacturing PMI street 55.3
9:45 am EST US Markit flash services PMI street 55.8
8:50 am EST FOMC Kashkari speaking
12:00 pm EST FOMC Harker speaking
3:30 pm EST FOMC Williams speaking