The S&P 500 futures trade 70 points, or 1.7%, above fair value as positive reactions to earnings reports help drive the rebound-minded bias. The Nasdaq 100 futures outperform and trade 2.1% above fair value.
Meta Platforms ( FB 203.68, +28.73, +16.4%) is setting the tone with a 16% pre-market gain following its earnings report, followed by healthy gains in Qualcomm ( QCOM 144.80, +9.70, +7.2%), McDonald’s ( MCD 252.00, +4.86, +2.0%), and Merck ( MRK 86.40, +1.99, +2.4%), among others.
To be fair, there are always outliers like Teladoc ( TDOC 32.40, -23.59, -42.1%), which has cratered over 40% on disappointing guidance. It appears, though, that the TDOC weakness is relatively contained rather than spreading to other growth stocks.
In other developments, the Bank of Japan made no headline policy changes; Democrats are attempting to revive Build Back Better discussions, according to The Wall Street Journal ; and OPEC+ is likely to agree to another 432,000-bpd oil output increase for June when it meets next week, according to Reuters .
Regarding today’s data, investors will receive the advance estimate for Q1 GDP (Briefing.com consensus 1.1%) and the weekly Initial Claims (Briefing.com consensus 182,000) and Continuing Claims report at 8:30 a.m. ET.
U.S. Treasuries trade little changed. The 2-yr yield is down one basis point to 2.56%, and the 10-yr yield is down one basis point to 2.81%. The U.S. Dollar Index is up 0.7% to 103.66. WTI crude futures are down 0.4% to $101.57/bbl.
In U.S. corporate news:
- Meta Platforms (FB 203.68, +28.73): +16.4% after beating EPS estimates, reporting an average of 1.96 billion DAUs for March – an increase of 4% year-over-year, and lowering its FY22 expense guidance. Note, the company missed revenue estimates and guided Q2 revenue below consensus.
- Qualcomm (QCOM 144.80, +9.70): +7.2% after beating top and bottom-line estimates and guiding fiscal Q3 EPS and revenue above consensus.
- McDonald’s (MCD 252.00, +4.86): +2.0% after beating top and bottom-line estimates.
- Merck (MRK 86.40, +1.99): +2.4% after beating top and bottom-line estimates and raising its FY22 EPS and revenue guidance to in-line with expectations.
- Amgen (AMGN 235.92, -12.87): -5.2% despite beating top and bottom-line estimates. Amgen received a notice of deficiency from the IRS for the 2013-2015 period. The notice could result in additional federal tax of approximately $5.1 billion, plus interest, and penalties of approximately $2 billion.
- Caterpillar (CAT 210.01, -3.95): -1.9% despite beating EPS estimates.
- Teladoc (TDOC 32.40, -23.59): -42.1% after issuing downside Q2 and FY22 revenue guidance and lowering its FY22 adjusted EBITDA guidance. TDOC beat EPS estimates.
Reviewing overnight developments:
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Equity indices in the Asia-Pacific region ended Thursday on a higher note. Japan’s Nikkei: +1.8% Hong Kong’s Hang Seng: +1.7% China’s Shanghai Composite: +0.6% India’s Sensex: +1.2% South Korea’s Kospi: +1.1% Australia’s ASX All Ordinaries: +1.3%.
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In economic data:
- Japan’s March Industrial Production 0.3% m/m (expected 0.5%; last 2.0%) and March Retail Sales 0.9% yr/yr (expected 0.4%; last -0.9%). March Housing Starts 6.0% yr/yr (expected -0.5%; last 6.3%) and March Construction Orders -21.2% yr/yr (last -2.3%)
- Australia’s Q1 Import Price Index 5.1% qtr/qtr (last 5.8%) and Export Price Index 18.0% qtr/qtr (last 3.5%)
- New Zealand’s March trade deficit NZD392 mln (last deficit of NZD691 mln). April ANZ Business Confidence -42.0 (last -41.9)
- Singapore’s Q1 Unemployment Rate 2.2% (last 2.3%)
- Hong Kong’s March trade surplus HKD37.30 bln (last deficit of HKD32.10 bln). March Imports -6.0% m/m (last 6.2%) and Exports -8.9% m/m (last 0.9%)
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In news:
- The Bank of Japan made no headline policy changes but it lowered its growth forecast and raised its CPI forecast for this year. The central bank announced that it will continue offering to buy JGBs every day.
- The Japanese yen fell to a level not seen since 2002 against the dollar after the decision.
- South Korea’s Finance Minister said that steps will be taken to stabilize the currency market if needed.
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Major European indices trade in the green. STOXX Europe 600: +1.0% Germany’s DAX: +1.6% U.K.'s FTSE 100: +1.0% France’s CAC 40: +1.7% Italy’s FTSE MIB: +1.4% Spain’s IBEX 35: +0.6%.
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In economic data:
- Italy’s April Business Confidence 110.0, as expected (last 110.1) and Consumer Confidence 100.0 (expected 100.4; last 100.8). February Industrial Sales 2.8% m/m (last 2.3%); 20.9% yr/yr (last 16.9%)
- Spain’s April CPI -0.1% m/m (last 3.0%); 8.4% yr/yr (expected 9.0%; last 9.8%). Q1 Unemployment Rate 13.65% (expected 14.20%; last 13.33%)
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In news:
- Spain’s April CPI decreased, fueling expectations that inflation has peaked or is close to doing so.
- Sweden’s Riskbank made an unexpected 25 bps rate hike.
- ECB President Lagarde said that the central bank has an unwavering commitment to delivering on its price target.
- Standard Chartered reported better than expected results for Q1 while Barclays also beat estimates but suspended its buyback.
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U.S. equity futures:
- S&P 500 Futures: +63 @ 4,247
- DJIA Futures: +288 @ 33,590
- Nasdaq 100 Futures: +272 @ 13,275
Overseas:
- Europe: DAX +1.6%, FTSE +1.0%, CAC +1.7%
- Asia: Nikkei +1.8%, Hang Seng +1.7%, Shanghai Composite +0.6%
Commodities:
- Crude Oil -0.77 @ 101.25
- Nat Gas -0.117 @ 7.222
- Gold -0.40 @ 1888.30
- Silver -0.378 @ 23.127
- Copper -0.0215 @ 4.4535