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US Stocks Finish Higher Despite Early Weakness in Financials
Today's financial recap and tomorrow's financial outlook.
Minyanville Staff    

Two of the world's major banking centers, the UK and Japanese, were closed today for holidays, the latter due to the string of Japanese holidays that together create Golden Week. As such, activity was muted across all markets. The final private estimate of Chinese manufacturing activity in April declined to 48.1 from the initial estimate of 48.3, the fourth straight month below a neutral reading of 50.

Last Friday, JPMorgan (NYSE:JPM) disclosed in its 10-Q that it expected revenue to fall by 20% in the second quarter from the quarter a year ago. The company noted a challenging environment and lower client activity levels. Financial stocks were under pressure today, particularly investment banks, which caused sharp overall weakness in stocks at the open. However, the major indices recovered by the late morning and the S&P 500 (INDEXSP:.INX) ended the day up 0.19%. The benchmark index was led by gains from utilities, health care, and energy stocks.

Housing stocks came under pressure with news from the Ira Sohn Investment Conference that DoubleLine Capital's Jeff Gundlach recommendation to short the sector due to single-family home weakness.

The April index of services companies activity rebounded for a second straight month after seven prior months of declining activity. The new orders and business activity components showed explosive growth in the month, but employment showed a noted drop, which stands at odds with last Friday's government payrolls report.

Tomorrow's Financial Outlook

The only major economic report scheduled for tomorrow is the March trade balance. Economists expect the US deficit to narrow to $40.2 billion from $42.3 billion in February. Federal Reserve Governor Jeremy Stein, a hawk who will step down at the end of this month, will give a speech in New York after the market close.

The most important event for risk assets overnight is the Reserve Bank of Australia's rate decision. Although CPI inflation continued to rise in the first quarter, the trimmed mean measure, which the central bank watches closely, was unchanged at 2.6%. This should give the RBA cover from having to turn more hawkish. It will likely continue to note the high level of the Australian dollar, however. UK, eurozone, and Canadian services PMI's are all scheduled to be reported.

Fifty-one major US companies are scheduled to report earnings tomorrow. Notable reports include Office Depot (NYSE:ODP), Emerson Electric (NYSE:EMR), Goodrich Petroleum (NYSE:GDP), DirecTV (NASDAQ:DTV), Nu Skin Enterprises (NYSE:NUS), Discovery Communications (NASDAQ:DISCA), Mosaic (NYSE:MOS), Disney (NYSE:DIS), Whole Foods (NASDAQ:WFM), Activision Blizzard (NASDAQ:ATVI), Electronic Arts (NASDAQ:EA), Marathon Oil (NYSE:MRO), First Solar (NASDAQ:FSLR), and Groupon (NASDAQ:GRPN).


Twitter: @Minyanville

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
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No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

US Stocks Finish Higher Despite Early Weakness in Financials
Today's financial recap and tomorrow's financial outlook.
Minyanville Staff    

Two of the world's major banking centers, the UK and Japanese, were closed today for holidays, the latter due to the string of Japanese holidays that together create Golden Week. As such, activity was muted across all markets. The final private estimate of Chinese manufacturing activity in April declined to 48.1 from the initial estimate of 48.3, the fourth straight month below a neutral reading of 50.

Last Friday, JPMorgan (NYSE:JPM) disclosed in its 10-Q that it expected revenue to fall by 20% in the second quarter from the quarter a year ago. The company noted a challenging environment and lower client activity levels. Financial stocks were under pressure today, particularly investment banks, which caused sharp overall weakness in stocks at the open. However, the major indices recovered by the late morning and the S&P 500 (INDEXSP:.INX) ended the day up 0.19%. The benchmark index was led by gains from utilities, health care, and energy stocks.

Housing stocks came under pressure with news from the Ira Sohn Investment Conference that DoubleLine Capital's Jeff Gundlach recommendation to short the sector due to single-family home weakness.

The April index of services companies activity rebounded for a second straight month after seven prior months of declining activity. The new orders and business activity components showed explosive growth in the month, but employment showed a noted drop, which stands at odds with last Friday's government payrolls report.

Tomorrow's Financial Outlook

The only major economic report scheduled for tomorrow is the March trade balance. Economists expect the US deficit to narrow to $40.2 billion from $42.3 billion in February. Federal Reserve Governor Jeremy Stein, a hawk who will step down at the end of this month, will give a speech in New York after the market close.

The most important event for risk assets overnight is the Reserve Bank of Australia's rate decision. Although CPI inflation continued to rise in the first quarter, the trimmed mean measure, which the central bank watches closely, was unchanged at 2.6%. This should give the RBA cover from having to turn more hawkish. It will likely continue to note the high level of the Australian dollar, however. UK, eurozone, and Canadian services PMI's are all scheduled to be reported.

Fifty-one major US companies are scheduled to report earnings tomorrow. Notable reports include Office Depot (NYSE:ODP), Emerson Electric (NYSE:EMR), Goodrich Petroleum (NYSE:GDP), DirecTV (NASDAQ:DTV), Nu Skin Enterprises (NYSE:NUS), Discovery Communications (NASDAQ:DISCA), Mosaic (NYSE:MOS), Disney (NYSE:DIS), Whole Foods (NASDAQ:WFM), Activision Blizzard (NASDAQ:ATVI), Electronic Arts (NASDAQ:EA), Marathon Oil (NYSE:MRO), First Solar (NASDAQ:FSLR), and Groupon (NASDAQ:GRPN).


Twitter: @Minyanville

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
< Previous
  • 1
Next >
No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

More From Minyanville Staff
US Stocks Finish Higher Despite Early Weakness in Financials
Today's financial recap and tomorrow's financial outlook.
Minyanville Staff    

Two of the world's major banking centers, the UK and Japanese, were closed today for holidays, the latter due to the string of Japanese holidays that together create Golden Week. As such, activity was muted across all markets. The final private estimate of Chinese manufacturing activity in April declined to 48.1 from the initial estimate of 48.3, the fourth straight month below a neutral reading of 50.

Last Friday, JPMorgan (NYSE:JPM) disclosed in its 10-Q that it expected revenue to fall by 20% in the second quarter from the quarter a year ago. The company noted a challenging environment and lower client activity levels. Financial stocks were under pressure today, particularly investment banks, which caused sharp overall weakness in stocks at the open. However, the major indices recovered by the late morning and the S&P 500 (INDEXSP:.INX) ended the day up 0.19%. The benchmark index was led by gains from utilities, health care, and energy stocks.

Housing stocks came under pressure with news from the Ira Sohn Investment Conference that DoubleLine Capital's Jeff Gundlach recommendation to short the sector due to single-family home weakness.

The April index of services companies activity rebounded for a second straight month after seven prior months of declining activity. The new orders and business activity components showed explosive growth in the month, but employment showed a noted drop, which stands at odds with last Friday's government payrolls report.

Tomorrow's Financial Outlook

The only major economic report scheduled for tomorrow is the March trade balance. Economists expect the US deficit to narrow to $40.2 billion from $42.3 billion in February. Federal Reserve Governor Jeremy Stein, a hawk who will step down at the end of this month, will give a speech in New York after the market close.

The most important event for risk assets overnight is the Reserve Bank of Australia's rate decision. Although CPI inflation continued to rise in the first quarter, the trimmed mean measure, which the central bank watches closely, was unchanged at 2.6%. This should give the RBA cover from having to turn more hawkish. It will likely continue to note the high level of the Australian dollar, however. UK, eurozone, and Canadian services PMI's are all scheduled to be reported.

Fifty-one major US companies are scheduled to report earnings tomorrow. Notable reports include Office Depot (NYSE:ODP), Emerson Electric (NYSE:EMR), Goodrich Petroleum (NYSE:GDP), DirecTV (NASDAQ:DTV), Nu Skin Enterprises (NYSE:NUS), Discovery Communications (NASDAQ:DISCA), Mosaic (NYSE:MOS), Disney (NYSE:DIS), Whole Foods (NASDAQ:WFM), Activision Blizzard (NASDAQ:ATVI), Electronic Arts (NASDAQ:EA), Marathon Oil (NYSE:MRO), First Solar (NASDAQ:FSLR), and Groupon (NASDAQ:GRPN).


Twitter: @Minyanville

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
< Previous
  • 1
Next >
No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

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