The S&P 500 futures trade 61 points, or 1.4%, above fair value after reports indicated that Russian President Putin claims that discussions with Ukraine have taken a positive turn.
Details have been scant, so the positive-sounding headline first reported by IFX is what the market is basing its optimism on. On a related note, President Biden is scheduled to speak at 10:15 a.m. ET to announce actions that continue to hold Russia accountable for its invasion of Ukraine.
Crude futures are higher ($106.87, +0.85, +0.9%) but are off overnight highs, which were driven by news that the U.S. and Iran could not revive a nuclear deal due to Russian qualms and key issues remaining unsolved.
The 10-yr yield is unchanged at 2.01% after trading at 1.97% overnight. The 2-yr yield is up one basis point to 1.73% after touching 1.69% overnight. The U.S. Dollar Index is down 0.1% to 98.41.
DocuSign ( DOCU 77.70, -16.18, -17.2%) and Rivian ( RIVN 37.80, -3.36, -8.2%), meanwhile, are the latest growth stocks that continue to fall from grace following their disappointing guidance and quarterly results, respectively. Oracle ( ORCL 75.25, -1.40, -1.8%) is down 2% after missing EPS estimates.
Separately, investors will receive the preliminary University of Michigan Index of Consumer Sentiment for March (Briefing.com consensus 62.5) at 10:00 a.m. ET. Investors will receive no other data.
In U.S. Corporate news:
- Oracle (ORCL 75.25, -1.40): -1.8% after missing EPS estimates, even as the company guided fiscal Q4 EPS and revenue above consensus.
- DocuSign (DOCU 77.70, -16.18): -17.2% after guiding revenue for fiscal Q1 and FY23 below consensus, outweighing the company’s revenue beat and share buyback authorization of up to $200 million.
- Rivian (RIVN 37.80, -3.36): -8.2% after missing top and bottom-line estimates. The company guided for FY22 production of 25,000 vehicles.
- Ulta Beauty (ULTA 387.50, +8.13): +2.1% after beating revenue estimates and authorizing a new $2.0 billion share repurchase program.
- Chevron (CVX 166.70, -4.12): -2.4% after the stock was downgraded to Underweight from Neutral at JP Morgan.
- Applied Materials (AMAT 129.25, +4.28): +3.4% after announcing a new $6 billion share repurchase authorization and increasing its cash dividend by 8.3%.
Reviewing overnight developments:
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Equity indices in the Asia-Pacific region ended the week on a mixed note. Japan’s Nikkei: -2.1% (-3.2% for the week) Hong Kong’s Hang Seng: -1.6% (-6.2% for the week) China’s Shanghai Composite: +0.4% (-4.0% for the week) India’s Sensex: +0.2% (+2.2% for the week) South Korea’s Kospi: -0.7% (-1.9% for the week) Australia’s ASX All Ordinaries: -1.0% (-0.8% for the week).
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In economic data:
- China’s February new loans CNY1.23 trln (expected CNY1.485 trln; last CNY3.98 trln), February Outstanding Loan Growth 11.4% yr/yr (expected 11.5%; last 11.5%), and February total social financing CNY1.19 trln (expected CNY2.215 trln; last CNY6.17 trln)
- Japan’s January Household Spending -1.2% m/m (expected -3.0%; last 0.2%); 6.9% yr/yr (expected 3.6%; last -0.2%). Q1 BSI Large Manufacturing Conditions -7.6 (expected 8.2; last 7.9)
- South Korea’s January Current Account surplus $1.81 bln (last surplus of $6.06 bln)
- New Zealand’s February Business NZ PMI 53.6 (last 52.3) and February FPI -0.1% m/m (last 2.7%)
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In news:
- Standard & Poor’s said that the risk of corporate defaults in China remains elevated this year.
- South Korea’s exports through the first ten days of March were up 14.9% yr/yr with chip exports growing 28.5%.
- South Korea reported its 21st consecutive monthly Current Account surplus.
- Japan’s Finance Minister Suzuki said that additional economic stimulus is not being considered at this time.
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Major European indices are looking for a higher finish to the week. STOXX Europe 600: +2.0% (+3.2% week-to-date) Germany’s DAX: +3.6% (+6.3% week-to-date) U.K.'s FTSE 100: +1.6% (+3.2% week-to-date) France’s CAC 40: +2.6% (+5.1% week-to-date) Italy’s FTSE MIB: +2.7% (+4.6% week-to-date) Spain’s IBEX 35: +2.2% (+6.9% week-to-date).
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In economic data:
- Germany’s February CPI 0.9% m/m, as expected (last 0.4%); 5.1% yr/yr, as expected (last 4.9%)
- U.K.'s January GDP 0.8% m/m (expected 0.2%; last -0.2%); 10.0% yr/yr (expected 9.3%; last 6.0%). January Construction Output 1.1% m/m (expected 0.5%; last 2.0%); 9.9% yr/yr (expected 9.2%; last 7.4%). January Industrial Production 0.7% m/m (expected 0.1%; last 0.3%); 2.3% yr/yr (expected 1.9%; last 0.4%). January Manufacturing Production 0.8% m/m (expected 0.2%; last 0.2%); 3.6% yr/yr (expected 3.1%; last 1.3%). January trade deficit GBP26.50 bln (expected deficit of GBP12.60 bln; last deficit of GBP12.35 bln)
- Spain’s February CPI 0.8% m/m (expected 0.6%; last -0.4%); 7.6% yr/yr (expected 7.4%; last 6.1%). February Consumer Confidence 89.8 (last 89.3)
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In news:
- EU Commission President Von der Leyen is reportedly planning to present a plan in mid-May for eliminating dependence on energy from Russia by 2027.
- Dutch Prime Minister Rutte said that reviewing Ukraine’s bid for EU accession may take years.
- European Central Bank policymaker Centeno said that monetary policy must shift to a more neutral position, but it should be done at a gradual rate.
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U.S. equity futures:
- S&P 500 Futures: +51 @ 4,311
- DJIA Futures: +346 @ 33,521
- Nasdaq 100 Futures: +207 @ 13,798
Overseas:
- Europe: DAX +3.6%, FTSE +1.6%, CAC +2.6%
- Asia: Nikkei -2.1%, Hang Seng -1.6%, Shanghai Composite +0.4%
Commodities:
- Crude Oil +0.67 @ 106.69
- Nat Gas +0.078 @ 4.709
- Gold -31.15 @ 1969.25
- Silver -0.481 @ 25.775
- Copper -0.0008 @ 4.6517