News flow from around the world overnight has been mixed and today’s trading reflects that.
Flash PMI reports have dominated the news and influenced trading. Japan came in above expectations which has boosted both JPY and the Nikkei ahead of tonight’s Bank of Japan meeting. China’s PMI report came in below 50 and below expectations once again, which dragged down the Hang Seng and resource currencies like AUD and NZD. Even CAD and NOK have been underperforming on the news even through crude oil itself is up today as it continues to benefit from yesterday’s bigger than expected US inventory decline.
European PMI numbers were mixed with manufacturing reports beating the street but the service side coming in soft. European indices have slipped back on the news while continental currencies have been stable.
A much stronger than expected UK retail sales report has had a positive impact on UK trading with GBP the top performing currency and the FTSE
outperforming its continental neighbours. This news continues to support forecasts that the next Bank of England move is likely to be an interest rate hike.
US markets have basically been in a holding pattern with USD running in the middle of the pack and US indices off slightly. Yesterday’s FOMC minutes pretty much ruled out a June interest rate hike but left the door wide open to interest rate liftoff later in the year. Focus now is on a series of economic reports due mid-morning like flash PMI, Philly Fed, leading index and existing home sales which could further stoke Fed speculation action.
CVS Health agrees to purchase Omnicare for $98.00/share in cash, or $12.7B including debt
NetApp $0.65 vs street $0.72, guides next Q ESP to $0.20-$0.25 way below street $0.60, 9% dividend increase
Best Buy $0.37 vs street $0.29
Economic reports released overnight and this morning include:
US jobless claims 274K vs street 270K
Japan flash manufacturing PMI 50.9 vs street 50.3
China flash manufacturing PMI 49.1 vs street 49.3
France flash manufacturing PMI 49.3 vs street 48.5
France flash service PMI 51.6 vs street 51.9
Germany flash manufacturing PMI 51.4 vs street 52.0
Germany flash service PMI 52.9 vs street 53.9
Eurozone flash manufacturing PMI 52.3 vs street 51.8
Eurozone flash service PMI 53.3 vs street 53.9
UK retail sales 4.7% vs street 3.7% vs previous 4.2%
UK retail ex auto and fuel 4.7% vs street 3.7% vs previous 5.0%
Economic reports due later today include:
9:45 am EDT US flash manufacturing PMI street 54.5
10:00 am EDT US Philadelphia Fed street 8.0
10:00 am EDT US existing home sales street 5.23M
10:00 am EDT US leading index street 0.3%
10:30 am EDT US natural gas street 96 BCF
ECB President Draghi and Fed Vice-Chair Fischer speaking