OVERNIGHT MARKETS AND NEWS
June E-mini S&Ps (ESM14Â +0.03%) this morning are up +0.05% at a new all-time high and European stocks are up +0.25% at a 5-1/2 year high after manufacturing activity in China last month expanded at the fastest pace in 5 months. Asian stocks closed higher: Japan +2.07%, Hong Kong, China and Taiwan closed for holidays, Australia +0.47%, Singapore +0.19%, South Korea +0.56%, India +1.93%. Japan’s Nikkei Stock Index climbed to a 4-week high after Japanese data showed Q1 capital spending rose by the most in nearly 2 years. Commodity prices are mixed. July crude oil (CLN14Â +0.16%) is up +0.23%. July gasoline (RBN14Â -0.04%) is up +0.12%. Aug gold(GCQ14Â +0.06%) is up +0.06% as it rebounds from a 4-month low. July copper (HGN14Â +1.41%) is up +1.47%. Agriculture prices are lower. The dollar index (DXY00Â +0.17%) is up +0.18%. EUR/USD (^EURUSD) is down -0.19% after a gauge of Eurozone manufacturing activity was revised lower to the slowest pace in 6 months. USD/JPY (^USDJPY) is up +0.27%. Sep T-note prices (ZNU14Â -0.25%) are down -9.5 ticks.
Chicago Fed President Evans said in a speech in Istanbul that the Fed will end asset purchases this year and may wait until inflation is much closer to its 2% objective before they consider raising interest rates. He added that a “highly accommodative” monetary policy is appropriate “well into 2015 and could even be” in 2016.
China May manufacturing PMI rose +0.4 to 50.8, better than expectations of +0.3 to 50.7 and the fastest pace of expansion in 5 months.
The Eurozone May Markit manufacturing PMI was revised lower to 52.2 from the originally reported 52.5, the slowest pace of expansion in 6 months.
The German May Markit/BME manufacturing PMI was revised lower to 52.3 from the originally reported 52.9, the slowest pace of expansion in 7 months.
UK Apr net consumer credit rose +0.7 billion pounds, less than expectations of +0.8 billion pounds and Mar was revised lower to show an increase of +1.0 billion pounds from the originally reported +1.1 billion pounds.
UK Apr mortgage approvals rose 62,900, less than expectations of 64,500 and the fewest in 9 months.
Japan Q1 capital spending ex-software rose +8.3% y/y, better than expectations of +5.9% y/y and the most in 7 years. Q1 capital spending climbed +7.4% y/y, better than expectations of +5.8% y/y and the most sine Q2 of 2012.
U.S. STOCK PREVIEW
The market is expecting today’s May ISM manufacturing index to show a +0.6 point increase to 55.5, which would be the fourth consecutive monthly increase. There are none of the Russell 1000 companies that report earnings today.
