On 15 April 2019 - Global Shares Mixed; Banks Up in Asia But Down in US

Anne D Picker

Anne D Picker - Econoday

Progress in trade talks reported; Chinese data awaited.

US markets

After strong gains on Friday, stocks in the U.S. eased back slightly on Monday. The Dow slipped 0.1 percent to trim its year-to-date gain to a still very strong 13.1 percent. Friday's session got a boost from better-than-expected earnings from JP Morgan Chase, in contrast to Monday as Goldman Sachs missed revenue estimates to send its shares sharply lower. Citigroup, which hit its estimates, edged fractionally lower.

The Empire State report offered the first assessment of this month's factory conditions in the U.S. and the results are mixed. The index, at a solid 10.1, came in near the high end of Econoday's consensus range with new orders up 4.5 points to 7.5. But there are a couple of warning signs in the report: unfilled orders dipped back to the negative column at minus 0.7 and the 6-month outlook dimmed noticeably, down more than 17 points to 12.4 for the weakest showing in more than three years. Next update on the U.S. factory sector, which has been stumbling since late last year, will be out on Thursday with the April report from the Philadelphia Federal Reserve.

There were also data out of Canada with the spring Business Outlook Survey pointing to moderation in domestic and foreign demand while investment and employment intentions remained positive. Nevertheless, the overall business outlook indicator, pressured by an uncertain outlook for the energy sector and continued weakness in housing, fell from the strongly positive 2.31 to minus 0.64 in the first quarter, in negative territory for the first time since the third quarter of 2016. Canada's S&P/TSX rose 0.2 percent on the session.

These data reflect observations at 4:00 PM US ET. Gold fell US$4.40 to US$1,290.80 while dated Brent spot crude fell US$0.25 to US$71.30. The US dollar was little changed against most major currencies.. The yield on the US Treasury 30-year bond fell 1 basis point to 2.97 percent while the yield on the 10-year note fell 1 basis points to 2.55 percent.

European markets

European markets posted mostly fractional gains on Monday with Germany's DAX up 0.2 percent, France's CAC 0.1 percent higher, and the FTSE nearly unchanged, posting a fractional decline. Italy's FTSE MIB rose 0.2 percent with its year-to-date among the very highest of any index, at 19.5 percent.

Italy's biggest bank, UniCredit Group, edged up despite agreeing to pay U.S. authorities $1.3 billion in fines for violations of U.S. sanctions against Iran and other countries. France's Vivendi was also in the news, posting a solid gain on higher first-quarter sales and after confirming it plans to sale a large stake in its UMG music unit.

Economic news was light but does include Switzerland's combined producer and import price index which rose 0.3 percent in March. This put the annual inflation rate at minus 0.2 percent, up from minus 0.7 percent in February. The monthly increase mainly reflected import prices which were up 0.5 percent although this still saw their yearly rate slip from 0.7 percent to 0.5 percent. The domestic PPI gained a smaller 0.2 percent versus mid-quarter which nudged its annual rate a tick firmer to a still very weak minus 0.5 percent. Like inflation elsewhere in Europe, underlying trends remain soft and inflation at the producer level looks very unlikely to give consumer inflation any real boost over the coming months. The Swiss Market Index rose 0.3 percent on the day.

Asia Pacific Markets

Asian shares were mixed with Japanese markets, which will be closed for six sessions beginning on April 29, posting sharp gains in contrast to other markets in the region. Both the Nikkei and the Topix rose 1.4 percent with bank shares bid higher in reaction to Friday's strong earnings out of U.S. giant JP Morgan Chase. This year's Golden Week in Japan will be extended to celebrate the accession of Crown Prince Naruhito.

The Shanghai Composite, unlike indexes elsewhere especially in the U.S., has not gotten much lift from Friday's upbeat trade figures out of China that included a jump in March exports. Chinese data will also headline this week's news with industrial production, retail sales not to mention first-quarter GDP out Wednesday morning local time. Estimates are mixed with gains seen for production and retail sales but a downtick to 6.3 percent expected for GDP though some estimates are calling for a gain.

India's merchandise trade deficit led the region's economic news Monday, widening from $9.60 billion in February to $10.89 billion in March. But the latest on exports, like that from China, is upbeat, at $32.55 billion in the month and up 11.02 percent year-on-year, accelerating from February's 2.44 percent increase. Chemicals, engineering goods and textiles led the export gains. At $43.44 billion, imports of goods rose 1.44 percent year-on-year in March after a 5.41 percent drop in February, with declines in coal, chemicals, machinery and electronics more than offset by an increase in crude oil purchases. Exported goods for the April 2018 to March 2019 period totaled $331.02 billion, up 9.1 percent from the prior 12 months, while imports of goods totaled $507.44 billion, up 9.0 percent. The Bombay Sensex rose 0.4 percent to lift its year-to-date gain to 7.9 percent.

Reports on trade talks continue to point to an agreement as U.S. demands over Chinese domestic subsidies are said to be softening. Over the weekend, U.S. Treasury Secretary Steven Mnuchin said the U.S. and China are nearing the final phase of negotiations.

Looking forward

The labour market report for March will be coming out of the UK with April's ZEW Survey out from Germany. The minutes of the Reserve Bank of Australia will headline Asia's news. From the US, industrial production for March will be posted.

Global Stock Markets

 

Index

15 Apr 2019

Daily Change

% Change Daily

North America

 

 

 

 

United States

Dow

26384.77

-27.53

-0.1

 

NASDAQ

7976.01

-8.15

-0.1

 

S&P 500

2905.58

-1.83

-0.1

Canada

S&P/TSX Comp

16515.46

34.93

0.2

Europe

 

 

 

 

UK

FTSE 100

7436.87

-0.19

0.0

France

CAC

5508.73

6.03

0.1

Germany

XETRA DAX

12020.28

20.35

0.2

Italy

MIB

21892.42

34.11

0.2

Spain

Ibex 35

9497.1

28.60

0.3

Sweden

OMX Stockholm 30

1642.63

1.42

0.1

Switzerland

SMI

9513.71

28.80

0.3

Asia/Pacific

 

 

 

 

Australia

All Ordinaries

6347.86

0.86

0.0

Japan

Nikkei 225

22169.11

298.55

1.4

 

Topix

1627.93

22.53

1.4

Hong Kong

Hang Seng

29810.72

-99.04

-0.3

S. Korea

Kospi

2242.88

9.43

0.4

Singapore

STI

3325.86

-6.12

-0.2

China

Shanghai Comp

3177.79

-10.84

-0.3

Taiwan

TAIEX

10875.6

70.30

0.7

India

Sensex 30

38905.84

138.73

0.4

*Markets closed

 

 

 

Data Source — Haver Analytics

 

 

 

Note: all releases are listed in local time.

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