Register for streaming realtime charts, analysis tools, and prices.
U.S. Stocks May Move Back To The Downside In Early Trading
US Market
The major U.S. index futures are currently pointing to a lower open on Friday, with stocks likely to move back to the downside following the notable rebound seen in the previous session.
A steep drop by JPMorgan Chase (JPM) may weigh on the markets, as the financial giant is tumbling by 3.0 percent in pre-market trading.
JPMorgan Chase is under pressure after reporting better than expected first quarter results but providing disappointing guidance for net interest income, a key profit metric.
Shares of Wells Fargo (WFC) are also seeing pre-market weakness after the company reported first quarter results that beat expectations on the top and bottom lines but showed a decline in net interest income.
On the other hand, shares of Citigroup (C) are likely to see initial strength after the company reported first quarter results that exceeded analyst estimates.
Inflation concerns may continue to weigh on the markets, however, as the Labor Department released a report showing import prices in the U.S. increased by slightly more than expected in the month of March.
The report said import prices climbed by 0.4 percent in March after rising by 0.3 percent in February. Economists had expected import prices to increase by another 0.3 percent.
Import prices also rose by 0.4 percent compared to the same month a year ago, marking the first year-over-year increase since January 2023.
Meanwhile, the Labor Department said export prices rose by 0.3 percent in March after climbing by a revised 0.7 percent in February. The increase in export prices matched economist estimates.
Compared to the same month a year ago, export prices were down by 1.4 percent in March following a 1.8 percent slump in February.
After ending Wednesday’s session sharply lower, stocks showed a strong move back to the upside during trading on Thursday. Technology stocks led the rebound on Wall Street, with the tech-heavy Nasdaq surging to a new record closing high.
The Nasdaq pulled back off its highs of the session going into the close but still ended the day up 271.84 points or 1.7 percent at 16,442.18. The S&P 500 also climbed 38.42 points or 38.42 points or 0.7 percent to 5,199.06, but the narrower Dow edged down 2.43 points or less than a tenth of a percent to 38,459.08.
The rally by the Nasdaq and S&P 500 in afternoon trading seemed to coincide with the release of the results of the Treasury Department’s auction of $22 billion worth of thirty-year bonds, which revealed the sale attracted average demand.
The thirty-year bond auction drew a high yield of 4.671 percent and a bid-to-cover ratio of 2.37, while the ten previous thirty-year bond auctions had an average bid-to-cover ratio of 2.39.
The bid-to-cover ratio is a measure of demand that indicates the amount of bids for each dollar worth of securities being sold.
Treasury yields pulled back off their highs following the release of the results, with the yield on the benchmark ten-year note giving back ground after reaching a high near 4.60 percent.
The Treasury revealed below average demand for this month’s three-year and ten-year note auctions earlier in the week.
Earlier in the day, stocks showed a lack of direction as traders weighed relatively tame producer price inflation data against Wednesday’s hotter-than-expected consumer price inflation data.
Before the start of trading, the Labor Department released a report showing producer prices increased in line with economist estimates in the month of March.
The Labor Department said its producer price index for final demand crept up by 0.2 percent in March after climbing by 0.6 percent in February. The uptick matched expectations.
Meanwhile, the report said the annual rate of producer price growth accelerated to 2.1 percent in March from 1.6 percent in February.
The annual rate of growth was the fastest since surging 2.3 percent last April but came in slightly slower than the 2.2 percent jump forecast by economists.
The producer price inflation data came after the Labor Department released a separate report on Wednesday showing consumer prices rose by slightly more than expected in March.
The report also said the annual rate of consumer price growth accelerated to 3.5 percent in March from 3.2 percent in February. Economists had expected a more modest acceleration to 3.4 percent.
Semiconductor stocks moved sharply higher over the course of the session, driving the Philadelphia Semiconductor Index up by 2.4 percent.
Considerable strength also emerged among computer hardware stocks, as reflected by the 1.7 percent gain posted by the NYSE Arca Computer Hardware Index.
Gold stocks also turned in a strong performance amid an increase by the price of the precious metal, with the NYSE Arca Gold Bugs Index climbing by 1.4 percent.
Transportation, networking and software stocks also saw some strength on the day, while banking and oil service stocks moved to the downside.
U.S. Economic Reports
Import prices in the U.S. increased by slightly more than expected in the month of March, according to a report released by the Labor Department on Friday.
The report said import prices climbed by 0.4 percent in March after rising by 0.3 percent in February. Economists had expected import prices to increase by another 0.3 percent.
Import prices also rose by 0.4 percent compared to the same month a year ago, marking the first year-over-year increase since January 2023.
Meanwhile, the Labor Department said export prices rose by 0.3 percent in March after climbing by a revised 0.7 percent in February. The increase in export prices matched economist estimates.
Compared to the same month a year ago, export prices were down by 1.4 percent in March following a 1.8 percent slump in February.
At 10 am ET, the University of Michigan is scheduled to release its preliminary reading on consumer sentiment in the month of April. The consumer sentiment index is expected to edge down to 79.0 in April after jumping to 79.4 in March.
Kansas City Federal Reserve President Jeffrey Schmid is due to speak on the economic and monetary policy outlook before the Agricultural Commodity Futures Conference.
At 2:30 pm ET, Atlanta Federal Reserve President Raphael Bostic is scheduled to speak and participate in a moderated conversation on housing before the Confronting America’s Housing Crisis: Solutions for the 21st Century Symposium.
San Francisco Federal Reserve Mary Daly is due to speak before a hybrid 2024 Fintech Conference on The Evolution of Fintech – AI, Payments, and Financial Inclusion at 3:30 pm ET.
Europe
European stocks have rallied on Friday after a European Central Bank (ECB) poll of professional forecasters predicted inflation in the eurozone will fall to 2 percent in 2025 and stay there in the longer term, giving the clearest indication that the ECB could cut interest rates in June. In-line regional inflation and GDP data has also boosted investor sentiment.
German consumer price inflation slowed to 2.2 percent in March from 2.5 percent in February, final data from Destatis revealed. That was in line with the flash data published earlier. The latest inflation was the weakest since May 2021, when prices had risen the same 2.2 percent.
French consumer price inflation posted an annual increase of 2.3 percent in March, following February’s 3.0 percent rise, according to the latest data from the statistical office INSEE. That was in line with the flash data published on March 29.
U.K. real GDP edged up 0.1 percent on a monthly basis in February, following a revised 0.3 percent expansion in January, the Office for National Statistics reported. The growth came in line with expectations.
While the U.K.’s FTSE 100 Index has surged by 1.5 percent, the German DAX Index is up by 0.8 percent and the French CAC 40 Index is up by 0.7 percent.
BP Plc and peer Shell have jumped in London as Brent crude futures climbed above $90 a barrel on speculation that Iran will respond to Israel’s attack on its Syrian embassy.
Mining giants Anglo American, Antofagasta and Glencore have also surged as base metals extended a rally on increased supply risks and an improving outlook for demand.
Homebuilders have also advanced following positive commentary from JPMorgan. Barratt Developments, Persimmon and Taylor Wimpey are posting notable gains.
French lender Societe Generale has also spiked a day after announcing a deal to sell its professional equipment financing business to rival BPCE for €1.1 billion.
Shares of ThyssenKrupp AG have also surged. The German industrial engineering and steel company late Thursday announced its loss-making Steel division’s structural realignment, including a significant cut in Duisburg’s production capacity, as well as jobs that are yet to be quantified.
Asia
Asian stocks declined on Friday as traders priced in less monetary policy easing by the Federal Reserve this year and waited for the U.S. earnings season to kick off with large-cap banking names.
Higher Treasury yields underpinned the dollar and oil resumed gains, while gold surged to $2,400 per ounce as Israel prepared for a strike by Iran or its proxies.
China’s Shanghai Composite Index dropped 0.5 percent to 3,019.47 as the U.S. crackdown on China’s tech sector intensified.
The United States has added six Chinese companies to an export blacklist, accusing them of seeking to acquire AI chips for China’s military or helping to procure drones for use by Russia.
Investors also looked ahead to a rate decision by the People’s Bank of China on Monday, with the central bank expected leave the key policy rate unchanged.
Hong Kong’s Hang Seng Index pluned 2.2 percent to 16,721.69 as China’s March exports and imports figures missed estimates by large margins. Exports fell 7.5 percent year-on-year, while imports unexpectedly shrank 1.9 percent, customs data showed.
Japanese stocks eked out modest gains as the dollar surged to another 34-year high above 153 yen on fading hopes for rate cuts. The Nikkei 225 Index inched up 0.2 percent to 39,523.55, while the broader Topix Index added 0.5 percent to close at 2,759.64.
Chip-related stocks tracked U.S. technology shares overnight, with Advantest and Tokyo Electron rising 0.9 percent and 1.5 percent, respectively.
Property developer Mitsui Fudosan soared 7.8 percent on share buyback news, but Uniqlo-parent Fast Retailing slumped 4.4 percent after leaving its annual operating profit forecast unchanged.
Seoul stocks fell sharply, with the Kospi closing down 0.9 percent at 2,681.82 after the Bank of Korea held its base rate steady for a 10th consecutive time as widely expected to combat inflation.
Australian markets edged lower as miners succumbed to profit taking after recent string of gains. Energy stocks also declined while gold miners surged on rising bullion prices.
The benchmark S&P ASX 200 Index dipped 0.3 percent to 7,788.10, while the broader All Ordinaries Index settled 0.3 percent lower at 8,050.20.
Across the Tasman, New Zealand’s benchmark S&P/NZX 50 Index finished marginally lower at 11,931.32 ahead of March-quarter CPI data due next week.
Commodities
crude oil futures are jumping $1.45 to $86.47 a barrel after tumbling $1.19 to $85.02 a barrel on Thursday. Meanwhile, after jumping $24.30 to $2,372.70 an ounce in the previous session, gold futures are spiking $40 to $2,412.70 an ounce.
On the currency front, the U.S. dollar is trading at 152.87 yen versus the 153.27 yen it fetched at the close of New York trading on Thursday. Against the euro, the dollar is valued at $1.0638 compared to yesterday’s $1.0726.
