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Dow 33,061.50 84.29 0.26%
S&P 500 4,155.38 23.45 0.57%
Nasdaq 12,536.02 201.38 1.63%
GlobalDow 3,798.61 -18.20 -0.48%
Gold 1,862.10 -49.60 -2.59%
Oil 105.83 1.14 1.09%Morgan Stanley “meaningful downside” for the S&P500
Analysts think the index has downside to at least 3800 in the ‘near term’ and possible to 3460 the 200-week moving average if forward 12 month EPS start to fall on margin and/or recession concerns
MS adds note the S&P 500 real earnings yield is the most negative since the 1950s and that to them this
suggests we have meaningful downside at the index level as investors figure this outThe RBA went a step further with a 0.25 basis point rise to 0.35% vs 0.15% launch. That helped to send the AUD to the top of the table of the strongest to weakest currencies and helped to take the shine off the greenback for the day.
The USD is the weakest of the major currencies as North American traders enter for the day although the declines are relatively modest vs the JPY, CAD and NZD (less than 0.17% declines).
Most of the declines are vs. the AUD with a near 1% decline of the USD on the day.
Equity indices in Asia-Pacific Wednesday mixed note China and Japan remained closed for holidays.
Hong Kong’s Hang Seng: -1.1%
India’s Sensex: -2.3%
South Korea’s Kospi: -0.1%
Australia’s ASX All Ordinaries: -0.3%.Australia’s April AIG Construction Index 55.9 (last 56.5). March Retail Sales 1.6% m/m (expected 0.6%; last 1.8%) and March Home Loans 0.9% m/m (expected -2.0%; last -4.7%)
New Zealand’s Q1 Employment Change 0.1% qtr/qtr, as expected (last 0.1%). Q1 Labor Cost Index 0.7% qtr/qtr, as expected (last 0.7%); 3.1% yr/yr, as expected (last 2.8%). Q1 Participation Rate 70.9% (expected 71.1%; last 71.1%)
Executives from HSBC and Ping An will reportedly discuss a proposal for a spinoff of HSBC’s Asian unit or other strategic options later this month.
North Korea reportedly conducted its 14th missile test of the year.
The Reserve Bank of India unexpectedly raised its repurchase rate by 40 bps to 4.4%.Major European indices trade in the red. STOXX Europe 600: -0.6% Germany’s DAX: UNCH U.K.’s FTSE 100: -0.4% France’s CAC 40: -0.4% Italy’s FTSE MIB: -0.3% Spain’s IBEX 35: -0.3%.
Eurozone’s April Services PMI 57.7, as expected (last 55.6). March Retail Sales -0.4% m/m (expected -0.1%; last 0.4%); 0.8% yr/yr (expected 1.4%; last 5.2%)
Germany’s April Services PMI 57.6 (expected 57.9; last 56.1). March trade surplus EUR3.20 bln (expected surplus of EUR9.80 bln; last surplus of EUR11.10 bln). March Imports 3.4% m/m (expected 1.0%; last 4.7%) an Exports -3.3% m/m (expected -2.0%; last 6.2%)
U.K.’s March Mortgage Lending GBP6.97 bln (expected GBP5.11 bln; last GBP4.56 bln) and Mortgage Approvals 70,690 (expected 70,780; last 70,970)
France’s April Services PMI 58.9 (expected 58.8; last 57.4)
Italy’s April Services PMI 55.7 (expected 54.5; last 52.1)
Spain’s April Services PMI 57.1 (expected 55.9; last 53.4) and April Unemployment Change -86,300 (last -2,900)European Commission President von der Leyen announced that three more Russian banks, including Sberbank, will be excluded from the SWIFT messaging system.
The EU plans to phase out the use of Russian crude in the next six months and end the use of refined products from Russia by the end of the year.
Germany’s Finance Minister Lindner warned against taxing excess profits of oil and gas companies.
Most members of the Bank of England’s Shadow board are in favor of a 50-bps rate hike tomorrow.Advanced Micro Devices (AMD 96.62, +5.49): +6.0% after beating top and bottom-line estimates and issuing upside revenue guidance for Q2 and FY22.
Airbnb (ABNB 152.56, +7.56): +5.2% after beating top and bottom-line estimates and guiding Q2 revenue above consensus.
Starbucks (SBUX 79.06, +4.73): +6.4% despite missing revenue estimates and suspending guidance for Q3 and Q4 due to numerous macroeconomic challenges. The company said there will need to be significant investments to help catch up to unmet demand.
Moderna (MRNA 158.50, +11.96): +8.2% after beating top and bottom-line estimates.
Lyft (LYFT 23.08, -7.68): -25.0% after issuing downside Q2 revenue guidance and saying it expects to ramp up investments in driver supply.U.S. Treasuries are on track for a mostly lower start while the long bond is expected to show a slight gain in early trade. Treasury futures dipped last evening, slipping to pre-market lows near the end of the Asian session. The slip to lows was followed by an immediate bounce, allowing futures to reclaim the bulk of last night’s losses. The market could see some volatility later today once the FOMC announces its rate decision at 14:00 ET, followed by Chairman Powell’s press conference.
Yield Check:
2-yr: +2 bps to 2.78%
3-yr: +3 bps to 2.97%
5-yr: +1 bp to 3.01%
10-yr: UNCH at 2.96%
30-yr: -1 bp to 3.00%The WALL STREET BEAR “PIT TRADERS” have SHEEP SHEARS in hand
ready for FOMC interest rate hike (1st 50 BPS since 2000)
even though MAIN STREET is already paying dearly in higher inflation prices
OOOOOHHHHHH THE HUMANITY — 50 BPS — Fed lifts interest rates by 1/2 point and to launch sell-off of $9 trillion bond stockpile in June
https://www.marketwatch.com/story/fed-lifts-interest-rates-by-1-2-point-and-to-start-sell-off-of-9-trillion-bond-stockpile-in-june-11651687306
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