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Weekly initial jobless claims totaled 230,000 (consensus 245,000) following last week’s revised count of 246,000 (from 245,000). Continuing claims totaled 1.858 million after last week’s revised total of 1.861 million (from 1.865 million).
Q1 GDP rose 1.1% in the advance reading (consensus 2.0%) after a 2.6% increase last quarter. The Q1 GDP Deflator rose 4.0% in the advance reading (Briefing.com consensus 3.7%) after a 3.9% increase last quarter.
The S&P 500 futures are up 20 points and are trading 0.6% above fair value.
The Nasdaq 100 futures are up 117 points and are trading 0.9% above fair value.
The Dow Jones Industrial Average futures are up 143 points and are trading 0.2% above fair value.Treasury yields took a sharp turn higher after the data release. The 2-yr note yield, at 3.92% just before 8:30 a.m. ET, is up 14 basis points to 4.05%. The 10-yr note yield, at 3.45% just before the release, is up six basis points to 3.49%.
S&P futures vs fair value: +23.00. Nasdaq futures vs fair value: +140.00.
The S&P 500 futures are up 23 points and are trading 0.7% above fair value.
The Nasdaq 100 futures are up 140 points and are trading 1.1% above fair value.
The Dow Jones Industrial Average futures are up 128 points and are trading 0.3% above fair value.Equity indices in the Asia-Pacific region ended the week on a higher note.
Japan’s Nikkei: +1.4% (+1.0% for the week),
Hong Kong’s Hang Seng: +0.3% (-0.9% for the week),
China’s Shanghai Composite: +1.1% (+0.7% week-to-date),
India’s Sensex: +0.8% (+2.4% for the week),
South Korea’s Kospi: +0.2% (-1.7% week-to-date),
Australia’s ASX All Ordinaries: +0.3% (-0.3% for the week).Japan’s March Retail Sales 7.2% yr/yr (expected 5.8%; last 7.3%)
March Industrial Production 0.8% m/m (expected 0.5%; last 4.6%).
March jobs/applications ratio 1.32 (expected 1.34; last 1.34) and Unemployment Rate 2.8% (expected 2.5%; last 2.6%).
April Tokyo CPI 3.5% yr/yr (expected 3.1%; last 3.3%) and Tokyo Core CPI 3.5% yr/yr (expected 3.2%; last 3.2%).
March Housing Starts -3.2% yr/yr (expected -4.3%; last -0.3%) and Construction Orders -4.1% yr/yr (expected 11.1%; last 22.3%)Japan will put South Korea back on the white list for exports.
Japan’s Industry Minister said that capital investments will be made to support eight battery projects and two semiconductor projects.
The Bank of Japan made no changes to its yield curve control policy, but it did remove a pledge to keep rates at or below current levels from its guidance. Instead, the statement noted that easing and yield curve control will continue with an aim of achieving the price stability target.Major European indices trade in the red.
STOXX Europe 600: -0.4% (-1.4% week-to-date),
Germany’s DAX: -0.4% (-0.9% week-to-date),
U.K.’s FTSE 100: -0.2% (-1.3% week-to-date),
France’s CAC 40: -0.9% (-2.1% week-to-date),
Italy’s FTSE MIB: -1.7% (-3.8% week-to-date),
Spain’s IBEX 35: -1.6% (-2.7% week-to-date).Eurozone’s Q1 GDP 0.1% qtr/qtr (expected 0.2%; last 0.0%); 1.3% yr/yr (expected 1.4%; last 1.8%)
Germany’s Q1 GDP -0.1% qtr/qtr (expected 0.3%; last 0.8%); 0.2% yr/yr (expected 0.8%; last 0.2%).
April Unemployment Change 24,000 (expected 10,000; last 16,000) and Unemployment Rate 5.6%, as expected (last 5.6%)France’s April CPI 0.6% m/m (expected 0.4%; last 0.9%); 5.9% yr/yr (expected 5.7%; last 5.7%).
March PPI 2.0% m/m (expected -0.3%; last -0.9%)Italy’s Q1 GDP 0.5% qtr/qtr (expected 0.2%; last -0.1%); 1.8% yr/yr (expected 1.4%; last 1.4%).
February Industrial Sales 1.3% m/m (last -1.2%); 7.2% yr/yr (last 8.4%)Spain’s Q1 GDP 0.5% qtr/qtr (expected 0.3%; last 0.2%); 3.8% yr/yr (expected 3.0%; last 2.6%).
April CPI 0.6% m/m (expected 0.9%; last 0.4%); 4.1% yr/yr (expected 4.4%; last 3.3%).
February Current Account surplus EUR2.29 bln (last surplus of EUR3.27 bln)Swiss April KOF Leading Indicators 96.4 (expected 98.1; last 99.2)
Germany’s Finance Minister Lindner said that fiscal rules in the EU should call for sustainable debt reduction with specific numerical targets.
The British government is reportedly reconsidering a plan to scrap or revise all EU law by the end of this year.
Mercedes beat Q1 expectations and affirmed its targets for FY23.
Markets in Germany, France, Italy, Spain, Switzerland, and the U.K. will be closed for Labor Day on Monday.
Amazon (AMZN 106.99, -2.83, -2.83, -2.6%): beats by $0.09, beats on revs, reports operating income above high end of guidance; guides Q2 revs in-line
Intel (INTC 31.65, +1.79, +6.0%): beats by $0.10, beats on revs; guides Q2 EPS below consensus, revs in-line
Snap (SNAP 8.58, -1.92, -18.3%): beats by $0.02, misses on revs, ad market showing signs of stabilization; internal revenue forecast for Q2 below consensus
Pinterest (PINS 23.67, +3.60, +13.2%): beats by $0.06, beats on revs
First Solar (FSLR 182.75, -18.08, -9.0%): reports Q1 (Mar) results, misses on revs; reaffirms FY23 EPS guidance, revs guidance
Mondelez Int’l (MDLZ 75.79, +1.97, +2.7%): beats by $0.08, beats on revs; guides FY23 EPS above consensus; raises FY23 organic revenue forecast
Mohawk (MHK 104.50, +5.72, +5.8%): beats by $0.45, beats on revs; guides Q2 EPS in-line
Cloudflare (NET 45.32, -14.26, -23.9%): beats by $0.05, reports revs in-line; guides Q2 EPS above consensus, revs below consensus; guides FY23 EPS above consensus, revs below consensus
Colgate-Palmolive (CL 79.15, +1.22, +1.6%): beats by $0.03, beats on revs, guides for FY23 organic sales growth of 4-6%
T-Mobile US (TMUS 147.26, -2.68, -1.8%): beats by $0.10, reports revs in-lineFirst Republic Bank (FRC 6.49, +0.30, +4.8%): US officials are leading rescue efforts for First Republic (FRC) bank, according to Reuters.
Exxon Mobil (XOM 117.94, +1.11, +1.0%): beats by $0.23, misses on revs
Chevron (CVX 166.44, -0.51, -0.3%): beats by $0.14, beats on revsColgate-Palmolive (CL 79.15, +1.22, +1.6%): beats by $0.03, beats on revs, guides for FY23 organic sales growth of 4-6%
The Q1 Employment Cost Index increased 1.2%, seasonally adjusted, for the three-month period ending in March 2023 (consensus 1.1%) following a revised 1.1% increase (from 1.0%) for the three-month period ending in December 2022. Wages and salaries, which account for about 70% of compensation costs, increased 1.2% following a revised 1.2% increase (from 1.0%).
The key takeaway from the report is that labor costs didn’t show any meaningful signs of deceleration. On a 12-month basis, compensation costs for civilian workers increased 4.8% versus 4.5% in March 2022 while benefit costs increased 4.5% versus 4.1% in March 2022.
No surprises in the March Personal income and Spending Report.
Personal income increased 0.3% month-over-month (consensus +0.2%) and personal spending was flat (consensus -0.1%). The PCE Price Index was up 0.1% (consensus +0.1%) and the core PCE Price Index, which excludes food and energy, was up 0.3% (consensus +0.3%).
The key takeaway from the report is that the core PCE Price Index, the Fed’s preferred inflation gauge, held fairly steady at persistently high levels, checking in at 4.6% year-over-year versus 4.7% in February. The stickiness of that component should keep the Fed sticking to its rate-hike ways.
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