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Pre-Market Primer: Good Morning Earnings Season


American stocks are showing gains after yesterday's losses.

Asian and European markets are in the negative today as investors continue to digest the disappointing US employment figures released on Friday. US equities futures, on the other hand, turned up this morning after four consecutive days of losses.

The Bank of Japan announced that it will keep the key interest rate below 0.1% and hold off on adding to its 30 trillion yen asset-purchasing program. China surprised economists with a surge in exports. After reporting an unthinkable trade deficit of $31.5 billion in February, China swung to a surplus of $5.35 billion, driven by an 8.9% rise in exports. Imports grew by 5.3%. The slower import growth could be a sign that domestic demand in China is flagging.

The weak US job growth in March that was reported last week drove European investors to flee to the safety of German bunds. Italian and Spanish bond yields both rose more than 10 basis points, reflecting a reduced investor risk appetite.

Germany's trade surplus also grew to 13.6 billion euros in February. The surplus, which beat estimates by over one billion euros, was fueled by a 8.6% gain in exports and a 6.1% increase in exports over the year earlier. French industrial production in February grew by 0.3% over January.

American stocks are showing gains after yesterday's losses.
  • Dow (^DJI) futures climbed 0.16% to 12,870.00.
  • S&P 500 (SPY) futures rose 0.15% to 1,377.00.
  • Nasdaq (^IXIC) futures gained 0.37% to 2,738.50.
The NFIB Small Business Optimism Index declined 1.8% to 92.5 as small businesses are becoming pessimistic about the strength of the economic recovery. Businesses report that access to credit and hiring are improving, however. Wholesale inventories for February, expected to rise 0.6% over January will be reported at 10:00 a.m.

In a speech at the Atlanta Fed, Ben Bernanke said yesterday that the US is "far from having fully recovered," but refrained from mentioning QE3. The heads of four Fed heads will be giving speeches at separate venues around the country today.

US stockpiles of crude oil rose by 2 million barrels to 364.4 million barrels, the highest level since 1990. WTI futures fell 0.33% to $102.12/barrel today. Japan will reduce its imports of Iranian oil this month. An executive from China's Sinopec said that the oil giant will "continue to be cautious about Iranian crude imports" as sanctions put the supply at risk.

Sony (SNE) reported a record loss of 520 billion yen for the year that ended on March 31. The company will be letting 10,000 employees go after four straight years in the red. The company has been suffering from a strong yen and competition from more agile competitors like Apple (AAPL) and Samsung. Japan's central bank has intervened to weaken the yen, which makes Japanese exports less favorable, but the currency is still higher than the likes of Sony would prefer. The yen gained today to 81.17 yen to the dollar.

Twitter: @vincent_trivett
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