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On 8 April 2019 - Global stocks steady with limited economic data to provide trading guidance

Anne D Picker

Anne D Picker - Econoday

Boeing falls after announcing production cuts.

US markets

US stocks were mixed but little changed Monday after a very light global data calendar provided little new information to guide trading. The Dow fell 0.3 percent on the day, the S&P advanced 0.1 percent, and the Nasdaq gained 0.2 percent.

Boeing fell sharply Monday after the plane manufacturer announced earlier that it would cut production of its 737 MAX aircraft from 52 per month to 42 per month, with orders for these aircraft weakening after two of them have crashed in recent months, killing 346 people. Hong Kong’s South China Morning Post reported Monday that China Aircraft Leasing Group Holdings has suspended its order of 100 Boeing 737 MAX plane until it is assured of their safety. Boeing has acknowledged that “erroneous activation” of a feature of the aircrafts’ software contributed to these crashes and has promised that a software update will prevent similar accidents happening again. The cut in production by Boeing also weighed on shares of General Electric, a major supplier of engines to Boeing, though a sharp fall in General Electric Monday was largely driven by a negative analyst recommendation. Software security producer Symantec was the strongest performer in the Nasdaq on a positive analyst recommendation.

Factory orders data published Monday provide more evidence of weakness in the sector, consistent with recent manufacturing production data and various national and regional manufacturing surveys. Factory orders fell 0.5 percent on the month in February after a flat January and an increase of just 0.1 percent in December, while both orders and shipments of core capital goods (nondefense ex-aircraft) fell 0.1 percent in February, though this followed relatively strong growth in January. Monday’s release also updated durable goods orders data for February but made no revision to the initial estimate for a fall of 1.6 percent.

These data reflect observations at 4:00 PM US ET. Gold rose US$6.30 to US$1,301.90 while dated Brent spot crude rose US$0.76 to US$71.10. The US dollar rose slightly against the yuan but fell moderately against other major currencies, with the Canadian dollar boosted by recent gains in global oil prices. The yield on the US Treasury 30-year bond rose 3 basis points to 2.93 percent and the yield on the 10-year note advanced 2 basis points to 2.52 percent.

European markets

European markets also closed mixed and little changed Monday. The FTSE rose 0.1 percent, the CAC fell 0.1 percent, and the DAX closed down 0.4 percent. Commerzbank fell on reports that German authorities will impose strict conditions on any merger involving the bank, while European suppliers to Boeing, including French manufacturer Safran, also fell on the news that Boeing is cutting production of its 737 MAX aircraft. Boeing’s main competitor, Airbus, posted a solid gain on the day.

Germany recorded a seasonally adjusted trade surplus of €18.7 billion in February, little changed from a minimally larger revised €18.6 billion in January and still well below levels seen in late 2017. Exports fell 1.3 percent on the month, while imports fell 1.6 percent. The February data suggest that net exports will have little impact wither way on headline GDP growth in the first quarter.

The United Kingdom is scheduled to exit the European Union on Friday, April 12, with no deal in place. The UK government and opposition continued talks Monday aimed at reaching a bipartisan deal to put to parliament, but the government has said that it will not accept the opposition’s demand to support a customs union with the EU. Parliament is currently debating a proposal that would prevent a no-deal Brexit from taking place. Prime Minister Theresa May is due to meet German Chancellor Angela Merkel and French President Emmanuel Macron Tuesday ahead of the EU leaders summit on Wednesday, with the EU considered likely to agree to some further delay to Brexit at this summit.

Asia Pacific Markets

Share markets re-opened in China, Hong Kong, and Taiwan after a holiday Friday, with the main index in each country closing Monday up from last Thursday’s closing level. The Nikkei and the Topix indices fell 0.2 percent and 0.3 percent respectively while Australia’s All Ordinaries index advanced 0.6 percent.

The Asia data calendar was bare Monday. Comments from Bank of Japan Governor Haruhiko Kuroda were in line with previous statements, with recent weakness in manufacturing data not altering his assessment that the Japanese economy is likely to continue its moderate expansion and that inflation will increase gradually towards the 2.0 percent target.

Looking forward

The global data calendar is again light Tuesday. Australian home loan data will be published shortly, followed by Swiss unemployment data, Italian retail sales data, and the US surveys of retail sales and small business confidence.

Global Stock Markets

 

Index

8 Apr 2019

Daily Change

% Change Daily

North America

 

 

 

 

United States

Dow

26341.02

-83.97

-0.3

 

NASDAQ

7953.88

15.19

0.2

 

S&P 500

2895.77

3.03

0.1

Canada

S&P/TSX Comp

16407.29

11.14

0.1

Europe

 

 

 

 

UK

FTSE 100

7451.89

5.02

0.1

France

CAC

5471.78

-4.42

-0.1

Germany

XETRA DAX

11963.4

-46.35

-0.4

Italy

MIB

21771.96

13.35

0.1

Spain

Ibex 35

9437.7

-72.60

-0.8

Sweden

OMX Stockholm 30

1624.52

2.25

0.1

Switzerland

SMI

9547.33

6.18

0.1

Asia/Pacific

 

 

 

 

Australia

All Ordinaries

6310.76

40.18

0.6

Japan

Nikkei 225

21761.65

-45.85

-0.2

 

Topix

1620.14

-5.61

-0.3

Hong Kong

Hang Seng

30077.15

*

*

S. Korea

Kospi

2210.6

0.99

0.0

Singapore

STI

3315.42

-7.22

-0.2

China

Shanghai Comp

3244.81

*

*

Taiwan

TAIEX

10800.57

*

*

India

Sensex 30

38700.53

-161.70

-0.4

*Markets closed
Source — Haver Analytics

 

 

 

Note: all releases are listed in local time.

Important Information

Econoday Inc. is a US company that provides financial commentary and indicators to industry professionals. All information provided and views expressed are those of Econoday. Reference in this document to specific securities should not be construed as a recommendation to buy or sell these securities, but is included for the purposes of illustration only. Past performance is not a reliable indicator of future results. The value of investments can go down as well as up and investors may not get back the amount invested.