OVERNIGHT MARKETS AND NEWS
June E-mini S&Ps (ESM14Â -0.12%) this morning are down -0.12% and European stocks are down -0.30% on concern over Chinese economic growth after a gauge of manufacturing activity in China contracted for a fourth month. Another negative for European equities is the slide in technology stocks led by a -4.7% decline in Ericsson AB after the world’s biggest maker of wireless networks reported quarterly profit that was below consensus. On the positive side, the Eurozone Apr Markit composite PMI expanded at its fastest pace in 2-3/4 years, and the Eurozone sovereign debt crisis continues to recede as the yield on Portugal’s 10-year bond dropped to an 8-year low of 3.63% after the government sold 750 million euros of 10-year securities, the first government bond auction since Portugal requested financial aid three years ago. Asian stocks closed mixed: Japan +1.09%, Hong Kong -0.97%, China -0.10%, Taiwan -0.20%, Australia +0.70%, Singapore -0.60%, South Korea -0.13%, India +0.52%. Commodity prices are mixed. Jun crude oil (CLM14Â -0.14%) is down -0.32% at a 1-week low on expectations for U.S. crude supplies to increase for the thirteenth time in fourteen weeks when the EIA reports weekly crude inventories later today. Jun gasoline (RBM14Â +0.09%) is up +0.09%. Jun gold (GCM14Â +0.44%) is up +0.49%. May copper (HGK14Â -0.49%) is down -0.41%. Agriculture and livestock prices are weaker. The dollar index (DXY00Â -0.22%) is down -0.22%. EUR/USD (^EURUSD) is up +0.28%. USD/JPY (^USDJPY) is down -0.35%. June T-note prices (ZNM14+0.15%) are up +6.5 ticks.
The Eurozone Apr Markit manufacturing PMI rose +0.3 to 53.3, better than expectations of no change at 53.0. The Apr Markit composite PMI unexpectedly rose +0.9 to 54.0, better than expectations of -0.1 to 53.0 and the fastest pace of expansion in 2-3/4 years.
The German Apr Markit/BME manufacturing PMI rose +0.5 to 54.2, better than expectations of +0.1 to 53.8. The Apr Markit/BME composite PMI unexpectedly rose +2.0 to 56.3, stronger than expectations of -0.3 to 54.0.
UK Mar public sector net borrowing increased by 4.9 billion pounds, less than expectations of 8.5 billion pounds.
UK Apr CBI trends total orders dropped -7 points to -1, weaker than expectations of +1 point to 7. Apr CBI business optimism rose +12 to 33, better than expectations of +4 to 25 and the highest in 41 years.
The China Apr HSBC manufacturing PMI rose +0.3 to 48.3, right on expectations.
U.S. STOCK PREVIEW
Today’s March new home sales report is expected to show an increase of +2.3% to 450,000, recovering somewhat from the -3.3% decline to 440,000 seen in February. The Treasury today will sell $35 billion of 5-year T-notes. There are 41 of the S&P 500 companies that report earnings today. Notable reports include Apple (consensus $10.17), Facebook ($0.24), Texas Instrument (0.41), Procter & Gamble (1.02), General Dynamics (1.64), Johnson Controls (0.65). There are no equity conferences during the remainder of this week.
OVERNIGHT U.S. STOCK MOVERS
Procter & Gamble (PGÂ -0.38%) reported Q3 EPS of $1.04, higher than consensus of $1.02.
Northrop Grumman (NOCÂ -1.98%) reported Q1 EPS of $2.63, much better than consensus of $2.15.
Yum! Brands (YUMÂ +1.93%) gained almost 3% in after-hours trading after it reported Q1 EPS ex-items of 87 cents, higher than consensus of 85 cents, and said Q1 same-store-sales in its China division were up 9%.
