US : Pre Market News – 03 May 2017

Jun E-mini S&Ps (ESM17 -0.12%) this morning are trading mildly lower on a -2% overnight sell-off in Apple on disappointing quarterly earnings results as iPhone sales are being slowed as people wait for upgrades on new versions. The markets are waiting for outcome of today’s FOMC meeting, which is expected to produce unchanged rates. European stocks are little changed this morning as the markets await today’s French presidential debate between centrist Emmanuel Macron and far-right Marine Le Pen in the home stretch to Sunday’s French presidential election. Today’s Eurozone Q1 GDP report of +0.5% q/q and +1.7% y/y was in line with market expectations but was strong compared with U.S. Q1 growth of +0.7% (q/q annualized) and was supportive for the euro and European stocks. The UK FTSE is down -0.31% this morning as the markets worry that Brexit negotiations are getting off on the wrong foot with tension between UK Prime Minister May and EU officials after reports of a frosty dinner meeting earlier this week where Ms. May said that the UK would refuse to pay any exit fee versus EU demands for 100 billion euros.

China’s Shanghai Composite index today fell by another -0.27% on continued concern about the government’s crackdown on leverage and improper trading. However, the Chinese government is making an effort to reassure investors and calm market nerves. The Chinese central bank today injected a large amount of daily liquidity to calm nerves. A news service run by the Chinese central bank urged investors not to overreact to tougher regulations in a front-page article. The Japanese and Hong Kong markets were closed today for holidays. Other Asian stock markets today were mixed: Taiwan +0.14%, Australia -0.98%, Singapore +0.83%, India -0.09%, Turkey -0.08%.

Key U.S. news today includes: (1) weekly MBA mortgage applications (previous +2.7% with purchase sub-index -1.0% and refi sub-index +7.2%), (2) Apr ADP employment (expected +178,000, Mar +263,000), (3) final-Apr Markit services PMI (expected unrevised at 52.5, prelim-Apr -0.3 to 52.5), (4) Apr ISM non-manufacturing PMI (expected +0.6 to 55.8, Mar -2.4 to 55.2), (5) 2-day FOMC meeting concludes with policy announcement, (6) EIA Weekly Petroleum Status Report.

Notable S&P 500 earnings reports today include: Facebook (consensus $ 1.12), Time-Warner (1.46), ADP (1.23), Excelon (0.62), Delphia Automotive (1.46), Garmin (0.45), Humana (2.75), Estee Lauder (0.73), Yum Brands (0.60), Southern Co (0.60), ICE (0.73), Molson Coors (1.29), Prudential Financial (2.64), Lincoln National (1.61), Kraft Heinz (0.85), AIG (1.05), Murphy Oil (-0.01), Williams Cos (0.21), Metlife (1.28), Level 3 Communications (0.33).

U.S. IPO’s scheduled to price today: Liberty Oilfield Services (BDFC), Antero Resources Midstream Management (AMGP), Biohaven Pharmaceutical (BHVN), UroGen Pharma (URGN).

Equity conferences: Deutsche Bank Health Care Conference on Wed-Thu, Macquarie Group Ltd Business Services Conference on Thu.

Apple (AAPL +0.63%) fell -2.3% in after-hours trading after saying that it is selling fewer phones because consumers are waiting for upgrades on newer models.

Weight Watchers (WTW -0.56%) rallied 13% in after-hours trading after boosting its annual EPS guidance.

FireEye (FEYE -2.16%) rallied 12% in after-hours trading after saying that it expects to be profitable by the end of this year.

First Solar (FSLR +2.61%) rallied 6% in after-hours trading after raising its 2017 guidance, which gave other solar stocks a boost as well.

Mondelez (MDLZ -0.73%)rallied more than 2% in after-hours trading after reporting above-consensus Q1 EPS.

Twilio (TWLO -1.31%) plunged nearly 30% in after-hours trading after cutting its annual revenue guidance.

Akamai Technologies (AKAM +1.66%) fell more than 10% in after-hours trading after its Q2 guidance missed estimates.

Etsy (ETSY +2.98%) fell -10% in after-hours trading after missing Q1 revenue and announcing that its CEO will step down.

Jun E-mini S&Ps this morning are trading mildly lower due to overnight weakness in Apple and some concern about the outcome of today’s FOMC meeting. Tuesday’s closes: S&P 500 +0.12%, Dow Jones +0.17%, Nasdaq +0.06%. The S&P 500 on Tuesday closed slightly higher on the -3.8 bp drop in the 10-year T-note yield to 2.280% and on continued support from positive Q1 earnings reports. Stocks were undercut by the much weaker-than-expected U.S. vehicles sales report, which caused a plunge in auto stocks (Ford -4.4%, GM -2.9%). Stocks were also undercut by the -2.42% sell-off in June crude oil prices which undercut oil stocks.

Jun 10-year T-note prices this morning are unchanged as the market waits for the FOMC meeting outcome and the Treasury’s quarterly funding announcement. Tuesday’s closes: TYM7 +7.50, FVM7 +5.50. Jun 10-year T-notes on Tuesday closed higher on the -2.42% sell-off June crude oil prices, which caused a -3.3 bp drop in the U.S. 10-year breakeven inflation expectations rate to 1.89%, and on the weak U.S. April vehicle sales report.

The dollar index is mildly higher this morning by +0.117 points (+0.12%), while EUR/USD is down -0.0019 (-0.17%) and USD/JPY is up +0.20 (+0.18%). Tuesday’s closes: Dollar index -0.101 (-0.10%), EUR/USD +0.0031 (+0.28%), USD/JPY +0.15 (+0.13%). The dollar index on Tuesday closed slightly lower on the weak U.S. vehicle sales report, which kept U.S. consumer spending in a weak light. The yen fell to a new 1-month low against the dollar on reduced safe-haven demand for the yen with global stock market strength and reduced concerns about Sunday’s French presidential election.

June WTI crude oil prices are up +0.48 (+1.01%) on a partial snap-back after Tuesday’s sharp losses. June gasoline is up +0.0304 (+1.09%). Tuesday’s closes: Jun crude -1.18 (-2.42%), Jun gasoline -0.0136 (-0.89%). June crude oil prices on Tuesday closed sharply lower on expectations for a rise in U.S. product inventories in Wednesday’s EIA report as the surplus simply moves from crude oil to products. Crude oil prices were also undercut by a larger than expected narrowing of Saudi Arabia’s government budget deficit due to improved non-oil income, which means less pressure on Saudi Arabia to support oil prices. Oil prices were boosted by news that Russian April crude oil output fell by -0.5% to an average of 10.995 million bpd, which is -252,000 bpd below the Oct level but less than the promised -300,000 bpd cut.