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Rare Chinese Trade Deficit Keeps Stocks in the Red


End of Day Roundup 03/10: Today's financial recap and tomorrow's financial outlook.

China showed its first trade deficit in the past two years in February, and one of the few deficits since the country began tracking the data. Exports showed an alarming 18.1% year-over-year decline and 45% drop from the prior month. The drop was due to a significant weakening in steel goods shipped to developed economies such as the US and European Union. Copper and crude oil imports also showed a significant drop from the prior month. The Chinese Shanghai Composite (SHA:000001) declined by 2.86% for the session, its worst day of the year.

US equities were hit hard in early trading due to the combination of further Ukraine tension and the poor trade data from China. Steel-producer and iron ore-miner stocks were all hit hard today. The S&P 500 (INDEXSP:.INX) ended the session about unchanged after declining to an intraday low of -0.59%. A notable outperformer was Bank of America (NYSE:BAC), which finished the day positive despite the financial sector remaining in the red for much of the day. The industrial sector was the worst performer today.

US commonwealth Puerto Rico filed to sell $3 billion in general obligation municipal bonds today that expire in 2035. The initial yields were reported to be at 8.625%-8.875%, below the previously mentioned 9%-9.5%. The deal will price by tomorrow.

Fuel cell makers such as Plug Power (NASDAQ:PLUG), Ballard Power (NASDAQ:BLDP), and FuelCell (NASDAQ:FCEL) all rose more than 10% in today's trading. FuelCell is scheduled to report earnings later this evening.

Tomorrow's Financial Outlook

Tomorrow morning the January JOLTS (Job Openings and Labor Turnover Survey) will be released. Economists pay close attention to this data set because it is the truest indication of underlying job-market activity. Also scheduled to be reported is January wholesaler inventories, which play a significant role in determining first-quarter GDP. Inventories are expected to rise 0.4% from the prior month after gaining 0.3% in December 2013.

Two important reports are due out tomorrow from the UK: the February NIESR GDP estimate and industrial production from the month. Also scheduled to be reported is Italian fourth-quarter GDP and Germany's trade balance in January.

Notable earnings reports scheduled for tomorrow are American Eagle Outfitters (NYSE:AEO), Dick's Sporting Goods (NYSE:DKS), Verifone Systems (NYSE:PAY), Diamond Foods (NYSE:DF), and Caesars Entertainment (NASDAQ:CZR).

Twitter: @Minyanville

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