MARKET WRAPS

Watch For:

Canada Labour Force Survey for May; Canada Industrial Capacity Utilization Rates for 1Q; World Agricultural Supply & Demand Estimates

Today's Top Headlines/Must Reads:

- Democrats Push for Debt-Ceiling Overhaul Bill After Default Scare

- China's Inflation Problem? It Has None

- Crypto's Quiet Gains: Ownership Climbs Despite Crash in Prices

- Cuba Spy Station Brings China Rivalry to America's Doorstep

Follow WSJ market coverage here

Opening Call:

Stock futures mostly eased back on Friday, as traders warily eye next week's inflation data and Federal Reserve interest rate decision.

The Fed's decision is likely to be colored by the May consumer price index report, due Tuesday. Traders should thus be cheered if CPI inflation continues to decline from the current 4.9%, further encouraging a Fed rate-hike pause.

However, news on Friday from the world's second biggest economy showed how concerns can grow when disinflation turns to deflation.

Data showed prices from China's producers fell 4.6% in the year to May, the fastest decline in seven years, suggesting not just cheaper input costs, but also waning demand in the country that tends to be the engine of global growth.

Read China's Second-Quarter GDP Growth Will Be 'Relatively High,' PBOC Gov Says

Overseas, Asian stocks gained, with Japan's Nikkei 2% higher and Hong Kong's Hang Seng up 0.5%. In Europe, Stoxx 600 was largely flat.

Stocks on the Move

Braze rose 9% after revenue in its fiscal first quarter jumped more than 31% to $101.8 million, and the loss in the period was narrower than analysts' expectations.

DocuSign was rising 7% in premarket trading after fiscal first-quarter revenue and billings beat the company's own guidance, and it raised its outlook for the fiscal year ending in January.

General Motors gained 3.4% in premarket trading after the automaker said its electric vehicles will be able to access Tesla 's supercharging network in 2024.

As for Tesla, the stock was rising 4.4% in premarket trading.

Post-Close Movers

Sientra's AlloX2 Pro Tissue Expander received 510k-clearance from the FDA. Shares rose 93% in aftermarket trading.

Elevation Oncology proposed an underwritten public offering. Shares fell 26% in after-hours trading.

Planet Labs fell 18% after guiding for fiscal-year revenue of about $225 million to $235 million, below analysts' forecasts of about $257 million.

Unico American's operating unit was placed into conservation in California, and Unico's stock will be delisted from Nasdaq. Shares fell 40% in aftermarket trading.

Forex:

The dollar remained weak following sharp falls after Thursday's larger-than-expected rise in initial jobless claims.

However, the currency could steady from here as traders stay cautious ahead of events next week, including decisions by the Fed and the ECB, UniCredit Research said.

"The light economic agenda today might lead to further position adjustments but is unlikely to induce more dollar weakness. The risk, if anything, is that the DXY might return closer to 104."

---

The euro looks undervalued against sterling and has limited scope to extend its recent fall, and as markets are already pricing in 100 bps of interest-rate rises by the Bank of England, ING said.

"EUR/GBP has moved back below 0.8600 after a very small rebound and we estimate the pair to be trading at around a 2.0% short-term undervaluation at the current levels, which falls beyond the 1.4% 1.5 standard-deviation lower-bound."

Energy:

Oil prices edged lower in Europe and were on course for a weekly loss as reports of progress in talks between Iran and the U.S. add the possibility of fresh supplies to the market.

"The fall in oil prices since the OPEC+ meeting likely reflects global growth fears and oil demand concerns," Commonwealth Bank of Australia said.

Read Solar Installation Could Hit New High in 2023 as Price Pressures Ease

Metals:

Base metals rose in early London trading, with aluminium prices supported by production worries as a drought in China threatens production.

Rainfall in China's Yunnan region has fallen to multidecade lows, undermining hydroelectric power output, which is crucial for powering the region's vast and power-hungry aluminum smelters, ANZ said.

   
 
 
   
 
 

TODAY'S TOP HEADLINES

 
 

Less Haggling, More Upselling: How EVs Will Change How You Buy a Car

Electric vehicles could make buying a car less stressful. They could also prolong the sales hustle well after you leave the dealership.

General Motors is in the process of rolling out a new digital sales platform so that customers can buy its products fully online, fully in dealerships or in a combination of both. Ford will introduce nonnegotiable pricing for its F-150 Lightning and Mustang Mach-E EVs starting next year.

   
 
 

China's Producer Prices Declined Further in May

China's factory-gate price index tumbled to its lowest reading in more than seven years, while consumer prices edged up slightly in May, thanks to higher food prices, official data showed Friday.

The producer-price index declined 4.6% from a year earlier in May, compared with the 3.6% decline in April and marking the weakest reading since February 2016, when PPI fell 4.9% from a year earlier, according to data released by the National Bureau of Statistics.

   
 
 

Ex-First Republic Executive to Head Turkey's Central Bank

ISTANBUL-Turkey's President Recep Tayyip Erdogan appointed a former First Republic Bank executive to lead the central bank, a likely shift away from the unorthodox economic policies that have sown economic instability and driven away foreign investors.

The new central-bank governor is Hafize Gaye Erkan, who until late 2021 was the co-CEO of First Republic Bank, which collapsed and was sold to JPMorgan Chase last month. She previously worked for Goldman Sachs and served on the board of Tiffany & Co.

   
 
 

Trump Indicted in Classified Documents Case

WASHINGTON-Donald Trump was indicted Thursday by a federal grand jury in the investigation into his handling of classified documents at his Mar-a-Lago resort in Florida, marking the first time in history that the federal government has brought charges against a former president.

Trump was charged with seven counts, a person familiar with the matter said, including violations of the Espionage Act, which bars the misuse of classified information, as well as obstruction and false statements. A lawyer for Trump, James Trusty, confirmed those counts on CNN.

   
 
 

Ukraine Targets Russian Lines, as Counteroffensive Gathers Pace

KHERSON, Ukraine-Ukraine launched armored assaults on entrenched Russian forces in the southeast of the country, as a high-stakes counteroffensive by Kyiv designed to decisively shift the momentum of the 15-month war gathered steam.

Ukrainian officials said they were carrying out what they described as local attacks in the southeastern Zaporizhzhia and eastern Donetsk regions, while Russia's defense minister said Moscow's forces had repelled Ukrainian attempts to break through Russian lines.

   
 
 

Write to ina.kreutz@wsj.com TODAY IN CANADA

Earnings:

Nothing major scheduled

Economic Calendar (ET):

0830 May Labour Force Survey

0830 Q1 Industrial capacity utilization rates

Stocks to Watch:

CAE Announces Pricing of Private Offering of C$400 M of Senior Unsecured Notes

---

CAPREIT Divests C$103 Million in Non-Core Properties; Reinvests C$74 Million in New Build Properties

   
 
 

Expected Major Events for Friday

06:00/GER: 1Q Labour cost index

08:00/ITA: Apr Industrial Production

12:30/CAN: May Labour Force Survey

12:30/CAN: 1Q Industrial capacity utilization rates

14:00/US: 1Q Quarterly Services

16:00/US: World Agricultural Supply & Demand Estimates (WASDE)

All times in GMT. Powered by Onclusive and Dow Jones.

   
 
 

Expected Earnings for Friday

Abraxas Petroleum (AXAS) is expected to report for 1Q.

Andrea Electronics Corp (ANDR) is expected to report for 1Q.

Environmental Tectonics Corp (ETCC) is expected to report for 4Q.

Exicure Inc (XCUR) is expected to report for 1Q.

Ocean Biomedical Inc (OCEA) is expected to report for 1Q.

Odonate Inc (ODTC) is expected to report $-1.17 for 1Q.

Virco Manufacturing Corp (VIRC) is expected to report for 1Q.

Powered by Onclusive and Dow Jones.

   
 
 

ANALYST RATINGS ACTIONS

Aptiv Raised to Outperform From Peer Perform by Wolfe Research

Carrier Global Cut to Equal-Weight From Overweight by Morgan Stanley

E2open Cut to Hold From Buy by Loop Capital

EPAM Systems Cut to Equal-Weight From Overweight by Morgan Stanley

Fisker Cut to Underperform From Peer Perform by Wolfe Research

HashiCorp Cut to Neutral From Buy by B of A Securities

Integra LifeSciences Cut to Hold From Buy by Argus Research

Las Vegas Sands Cut to Hold From Buy by Jefferies

Marsh & McLennan Raised to Outperform From In-Line by Evercore ISI Group

New Fortress Energy Cut to Neutral From Buy by B of A Securities

QuantumScape Cut to Underperform From Peer Perform by Wolfe Research

SES AI Cut to Underperform From Peer Perform by Wolfe Research

Solid Power Cut to Underperform From Peer Perform by Wolfe Research

T-Mobile US Raised to Outperform From Peer Perform by Wolfe Research

Torrid Holdings Cut to Market Perform From Outperform by Telsey Advisory Group

Visteon Raised to Outperform From Peer Perform by Wolfe Research

Wynn Resorts Cut to Hold From Buy by Jefferies

This article is a text version of a Wall Street Journal newsletter published earlier today.

 

(END) Dow Jones Newswires

June 09, 2023 06:17 ET (10:17 GMT)

Copyright (c) 2023 Dow Jones & Company, Inc.