Report of Fed Slowdown Spooks Equity and Fixed Income Markets Alike
Today's financial recap and tomorrow's financial outlook.
US equity futures were down as much as 7 points overnight after this article, but traded into positive territory by noon today. After that, stocks held the flat line and didn't have much movement. Health care and financials were the leading sectors, both up more than 0.25%.
On the other side of the spectrum, US Treasuries were down on the day and seemed to move in concert with stocks, which was a divergence from the norm as they typically move in the opposite direction. Overnight, Japanese government bond futures were halted after trading down more than a point on intense volatility. Both Japan and the US have seen intense volatility in their government bond markets lately, which is concerning given the amount of manipulation in both markets.
April advance retail sales rose 0.1% month-to-month and 3.7% from last April, better than the economist estimate, which predicted a 0.3% decline. After backing out the more volatile energy related declines, retail sales rose 0.7%. Most of the gains came from merchandise purchases while declines were in food and beverage related consumption.
Tomorrow's Financial Outlook
Tomorrow will be on the lighter side for economic data compared to the more robust calendar for the rest of the week. The NFIB Small Business Optimism Index will be released in the morning with analysts expecting an increase to 90.5 from 89.5 the month prior. The other economic data is the import/export price index, which is expected to continue to show declines.
There are two are notable global economic data releases tomorrow. In Europe, eurozone industrial production is expected to grow 0.5% in March, up from 0.4% the month prior. The Germany ZEW survey of economic expectations is expected to grow to 40.0 in May from 36.3 the month prior. It is important to note that the survey fell from a high mark of 48.5 last month.
Earnings will continue to be on the lighter side with Agilent (NYSE:A) and Eagle Materials (NYSE:EXP).
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