The S&P 500 futures trade 18 points, or 0.4%, above fair value to start the week amid a carryover of positive momentum.
Ostensibly, weaker oil prices ($108.09, -5.81, -5.1%) are helping risk sentiment, although they’re down on growth concerns after Shanghai imposed lockdowns to curb an outbreak of COVID-19. China’s Shanghai Composite eked out a 0.1% gain on Monday.
The Treasury market is also reflecting growth concerns by way of curve-flattening activity. The 2-yr yield is up two basis points to 2.31%, while the 10-yr yield is down two basis points to 2.47%.
The U.S. Dollar Index is up 0.5% to 99.25 amid relative weakness in the Japanese yen, which is down 1.6% against the dollar after the Bank of Japan offered to buy an unlimited amount of JGBs at 0.25%. That move was consistent with the central bank’s policy of yield curve control.
In key corporate news, Apple ( AAPL 172.84, -1.88, -1.1%) is planning to cut production for the iPhone SE by roughly 20% and AirPods by more than 10 million units this year amid the geopolitical uncertainty, according to The Nikkei . Tesla ( TSLA 1067.50, +56.86, +5.6%) will ask shareholders to authorize additional shares to enable another stock split.
Separately, investors will receive the Advance International Trade in Goods, Retail Inventories, and Wholesale Inventories reports for February at 8:30 a.m. ET.
In U.S. Corporate news:
- Apple (AAPL 172.84, -1.88): -1.1% after The Nikkei reported that the company is planning to cut production for the iPhone SE and AirPods amid the geopolitical uncertainty. The report said the company will reduce SE production by about 20% and reduce AirPod production by more than 10 million this year.
- Tesla (TSLA 1067.50, +56.86): +5.6% after the company tweeted it will ask shareholders to vote at this year’s annual meeting to authorize additional shares in order to enable a stock split.
- Beyond Meat (BYND 45.90, -2.73): -5.6% after the stock was downgraded to Underweight from Neutral at Piper Sandler.
Reviewing overnight developments:
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Equity indices in the Asia-Pacific region began the week on a mixed note. Japan’s Nikkei: -0.7% Hong Kong’s Hang Seng: +1.3% China’s Shanghai Composite: +0.1% India’s Sensex: +0.4% South Korea’s Kospi: UNCH Australia’s ASX All Ordinaries: UNCH.
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In economic data:
- China’s February Industrial Profit 5.0% YTD (last 34.3%) o Hong Kong’s February trade deficit HKD32.10 bln (last surplus of HKD6.60 bln). February Imports 6.2% m/m (last 9.6%) and Exports 0.9% m/m (last 18.4%)
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In news:
- The Bank of Japan conducted a second bond buying operation at a fixed rate after the first operation failed to entice buyers.
- The yen plunged in response, falling toward its low from 2015. The central bank plans to continue buying bonds through Thursday.
- China auctioned over 500 kilotons of wheat from state reserves.
- Westpac noted that financial markets are overstating the likelihood of tighter policy over the next couple years.
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Major European indices trade on a firmly higher note. STOXX Europe 600: +0.9% Germany’s DAX: +1.9% U.K.'s FTSE 100: +0.7% France’s CAC 40: +1.7% Italy’s FTSE MIB: +2.1% Spain’s IBEX 35: +1.8%.
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There was no economic data today
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In news:
- Spain’s Prime Minister Sanchez announced that EUR6 bln will be spent to offset higher energy prices.
- Negotiators from Russia and Ukraine are reportedly meeting in Turkey today.
- Germany’s ruling SPD won a regional election in Saarland.
- A referendum to join Russia may be held in Luhansk, Ukraine, but Ukraine’s officials already indicated that the vote would have no legal basis in their eyes.
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U.S. equity futures:
- S&P 500 Futures: +10 @ 4,553
- DJIA Futures: +57 @ 34,918
- Nasdaq 100 Futures: +38 @ 14,792
Overseas:
- Europe: DAX +1.9%, FTSE +0.7%, CAC +1.7%
- Asia: Nikkei -0.7%, Hang Seng +1.3%, Shanghai Composite +0.1%
Commodities:
- Crude Oil -6.97 @ 106.93
- Nat Gas -0.055 @ 5.556
- Gold -26.60 @ 1927.60
- Silver -0.493 @ 25.122
- Copper -0.0265 @ 4.6720