Live Index – Mon, 23 May 2016 Premarket

Jun E-mini S&Ps (ESM16 -0.10%) are down -0.17% and European stocks are down -1.07%. Concerns about European economic growth are undercutting stocks after the Eurozone May Markit manufacturing PMI unexpectedly fell. Comments from St. Louis Fed President Bullard were another negative for equities when he said that there are signs that show the U.S. growing below trend pace of 2%. The weekend meeting of G-7 finance ministers and central bankers failed to inspire markets, although USD/JPY did fall after U.S. Treasury Secretary Lew reiterated his view that recent movements of the yen haven’t been overly volatile. Asian stocks settled mixed: Japan -0.49%, Hong Kong -0.22%, China +0.64%, Taiwan +2.62%, Australia -0.60%, Singapore +0.11%, South Korea +0.46%, India -0.28%. Chinese and Taiwan stocks closed higher as Apple vendors Taiwan Semiconductor Manufacturing and Hon Hai Precision Industry rallied after the Economic Daily news reported that Apple asked suppliers to prepare production of a new version of its smartphones. Japan’s Nikkei Stock Index closed lower after Japanese traded data showed exports from Japan fell for a seventh consecutive month last month.

The dollar index (DXY00 -0.02%) is up +0.01%. EUR/USD (^EURUSD) is down -0.13%. USD/JPY (^USDJPY) is down -0.64%.

Jun T-note prices (ZNM16 +0.11%) are up +5.5 ticks.

St. Louis Fed President Bullard (voter) said that signs show the U.S. growing below trend pace of 2% and “the slower, below-trend pace of recent U.S. growth is inconsistent with a slowly rising path for the policy rate.”

The Eurozone May Markit manufacturing PMI unexpectedly fell -0.2 to 51.5, weaker than expectations of +0.2 to 51.9.

The Japan Apr trade balance was in surplus by +823.5 billion yen, wider than expectations of +540.0 billion yen and the largest surplus in 6 years. Apr exports fell -10.1% y/y, weaker than expectations of -9.9% y/y, and Apr imports plunged -23.3% y/y, weaker than expectations of -19.2% y/y and the biggest decline in 6-1/2 years.

Key U.S. news today includes: (1) St. Louis Fed President James Bullard (voter) delivers a presentation on the U.S. economy and monetary policy at the Official Monetary and Financial Institution Forum in Beijing, (2) San Francisco Fed President John Williams (non-voter) speaks at the Council on Foreign Relations on the evolving challenges and approaches to monetary policy and their implications for fiscal policies targeted at enhancing long-term growth, (3) prelim-May Markit manufacturing PMI (expected +0.2 to 51.0, Apr -0.7 to 50.8), (4) Philadelphia Fed President Patrick Harker (non-voter) speaks on the economic outlook at the Philadelphia Club, (5) USDA weekly grain export inspections, (6) USDA Apr Cold Storage, (7) USDA Weekly Crop Progress.

There is 1 of the Russell 1000 companies that report earnings today: Nordson Corp (consensus $ 0.92).

U.S. IPO’s scheduled to price today: Clearside Biomedical (CLSD), Midland States Bancorp (MSBI).

Equity conferences this week include: UBS Global Health Care Conference on Mon-Wed, J.P. Morgan Global Technology, Media and Telecom Conference on Mon-Wed, Hart Energy DUG Permian Basin Conference on Mon-Tue, UBS Global Oil & Gas Conference on Tue-Wed, Wolfe Research Global Transportation & Industrials Conference on Tue-Wed.

Boston Scientific (BSC) was downgraded to ‘Neutral’ from ‘Buy’ at BTIG.

Alcoa (AA -0.11%) was upgraded to ‘Buy’ from ‘Neutral at Bank of America Merrill Lynch.

Prologis (PLD +0.69%) was downgraded to ‘Hold’ from ‘Buy’ at Evercore ISI.

Big Lots (BIG +1.65%) was downgraded to ‘Hold’ from ‘Buy’ at Deutsche Bank.

Staples (SPLS +1.00%) was upgraded to ‘Buy’ from ‘Underperform’ at Bank of America Merrill Lynch.

Square (SQ -2.19%) rose 3% in pre-market trading after it was upgraded to ‘Buy’ from ‘Outperform’ at CLSA.

K2M Group Holdings (KTWO +3.19%) was upgraded to ‘Strong Buy’ from ‘Buy’ at Needham & Co. with a 12-month price target of $ 21.

U.S. Silica Holdings (SLCA +4.00%) was upgraded to ‘Outpeform’ from ‘Sector Perform’ at RBC Capital Markets.

Energy Transfer Partners LP (ETP +2.15%) was upgraded to ‘Buy’ from ‘Neutral’ at Goldman Sachs.

The Gap (GPS +4.22%) gained over 1% in after-hours trading as it added onto Friday’s 4% increase after it said it would close 75 Old Navy and Banana Republic stores outside North America as it focuses on more profitable regions.

Lending Club (LC +7.84%) fell nearly 1% in after-hours trading after Reuters reported that people familiar with the matter said the company hired Jeffries to help find investors for loan funding.

Actions Semiconductor (ACTS +3.40%) surged over 20% in after-hours trading after former CEO Hsuan-Wen and affiliates proposed to acquire the company for $ 2/ADS, well above Friday’s closing price of $ 1.52.

June E-mini S&Ps (ESM16 -0.10%) this morning are down -3.50 points (-0.17%). Friday’s closes: S&P 500 +0.60%, Dow Jones +0.38%, Nasdaq +1.10%. The S&P 500 on Friday closed higher on the +1.7% increase in U.S. Apr existing home sales to 5.45 million (stronger than expectations of +1.3% to 5.40 million) and on the +14% surge in Applied Materials, which spurred gains in semiconductor chip makers and lifted the technology sector.

June 10-year T-note prices (ZNM16 +0.11%) this morning are up +5.5 ticks. Friday’s closes: TYM6 +1.00, FVM6 +.25. Jun T-notes on Friday closed little changed. T-note prices were boosted by reduced inflation expectations after the 10-year T-note breakeven inflation rate fell to a 1-1/2 week low. T-note prices were undercut by the rally in stocks and the stronger-than-expected U.S. Apr existing home sales report.

The dollar index (DXY00 -0.02%) this morning is up +0.022 (+0.02%). EUR/USD (^EURUSD) is down -0.0015 (-0.13%). USD/JPY (^USDJPY) is down -0.70 (-0.64%). Friday’s closes: Dollar Index +0.047 (+0.05%), EUR/USD +0.0021 (+0.19%), USD/JPY +0.19 (+0.17%). The dollar index on Friday closed higher on the stronger-than-expected U.S. Apr existing home sales and the rally in USD/JPY to a 3-week high as a rally in stocks reduced the safe-haven demand for the yen.

July WTI crude oil (CLN16 -1.22%) is down -67 cents (-1.38%). July gasoline (RBN16 -0.55%) is down -0.0143 (-0.87%). Friday’s closes: CLN6 -0.26 (-0.53%), RBN6 -0.0178 (-1.08%). July crude oil and gasoline on Friday settled mixed. Crude oil prices were undercut by a stronger dollar and by forecasts for rains in western Canada that may keep the wildfires there from spreading to the Canadian oil-sands production sites. Crude oil prices were boosted by the Baker Hughes report showing that the number of active U.S. rigs in the week ended May 20 remained unchanged at at a 6-1/2 year low of 318 rigs. Crude oil was also boosted by strong refinery demand for gasoline after the crack spread rose to a 3-week high.