Analysts at BNP Paribas are expecting that the U.S. economic growth to slow to 2.3% this year.
U.S. stock-index futures tumbled on Monday, as worries about an intensifying fallout from Washington's crackdown on Huawei weighed on market sentiment.
Today's Change, points
Today's Change, %
(company / ticker / price / change ($/%) / volume)
ALTRIA GROUP INC.
Amazon.com Inc., NASDAQ
American Express Co
Cisco Systems Inc
Citigroup Inc., NYSE
Deere & Company, NYSE
Exxon Mobil Corp
FedEx Corporation, NYSE
Ford Motor Co.
Freeport-McMoRan Copper & Gold Inc., NYSE
General Electric Co
General Motors Company, NYSE
Home Depot Inc
HONEYWELL INTERNATIONAL INC.
International Business Machines Co...
International Paper Company
JPMorgan Chase and Co
Merck & Co Inc
Procter & Gamble Co
Starbucks Corporation, NASDAQ
Tesla Motors, Inc., NASDAQ
The Coca-Cola Co
Travelers Companies Inc
Twitter, Inc., NYSE
United Technologies Corp
UnitedHealth Group Inc
Verizon Communications Inc
Wal-Mart Stores Inc
Walt Disney Co
Yandex N.V., NASDAQ
Tesla (TSLA) target lowered to $230 from $275 at Wedbush
Federal Reserve announced on Monday the Chicago Fed national activity index
(CFNAI), a weighted average of 85 different economic indicators, came in at
-0.45 in April, down from a revised +0.05 in March (originally -0.15), pointing
to a decrease in economic growth.
Economists had forecast the index to come in at -0.33 in April.
At the same time, the index’s three-month moving average declined -0.22 in April from -0.16 in March.
According to the report, three of the four broad categories of indicators that make up the index dropped from March, and two of the four categories made negative contributions to the index in April.
The contribution from production-related indicators to the CFNAI moved down to -0.44 in April from -0.04 in March. The contribution of the personal consumption and housing category to the CFNAI decreased to -0.05 in April from a neutral value in March. Meanwhile, the sales, orders, and inventories category made a contribution of +0.01 to the CFNAI in April, down from +0.06 in March. Employment-related indicators contributed +0.04 to the CFNAI in April, up slightly from +0.03 in March.
Rabobank's analysts note USD longs edged lower but they have remained essentially consolidative since the middle of March, according to IMM net speculators’ positioning as at May 14, 2019.
Analysts at BNP Paribas note the news flow for the German economy has definitely improved over the past few months.
The Westpac's analysts say the main highlight for the Aussie remains Tuesday’s RBA May board meeting’s minutes and the speech by Governor Lowe.
According to data collected by Refinitiv analyst David Aurelio, the average expectation is for a first-quarter earnings per share decline of 18% followed by a 9% second-quarter decline.
"Looking forward, analysts expect third-quarter EPS growth of 6.9% for the S&P 600 and 23.3% growth for the fourth quarter, according to Refinitiv’s Aurelio. For small caps to pick up and resume their outperformance we need to see better trends in the economic data in the second half, which would lead to better earnings growth in the third and fourth quarter, which the Street is expecting,” he said.
The ongoing decline in Cable is now facing a potential visit to the 1.2696/62 band, according to Commerzbank’s Senior Technical Analyst Axel Rudolph.
“GBP/USD has fallen below the February low at 1.2772 with the August, October and mid-January lows at 1.2696/62 thus being on the cards. Minor resistance comes in at the 1.2865 April low. Immediate downside pressure will be maintained while no rise above the 200 day moving average at 1.2956 is seen. Next up is the May 10 high at 1.3048. Only if this level were to be exceeded, would we look for the 1.3185/97 April and current May highs as well as the 61.8% Fibonacci retracement to be retested. This currently looks unlikely. The cross will need to regain the 1.3217 January 25 high to introduce scope to the 1.3351/82 resistance area, made up of the February and March highs, where we expect it to struggle”.
Parliament's impasse over Brexit must not be allowed to hold back Britain's financial services, City minister John Glen said on Monday.
The financial sector's traditional strengths were in good health, but the "slow and frustrating" process of seeking a deal on Britain's departure from the European Union remained a shadow, Glen said.
"The City wants and frankly deserves certainty," Glen said. We can't allow the impasse of this parliament to hold the City back."
British households turned more downbeat about their finances in May, according to a survey that hinted at weakness in the consumer economy which has been one of the bright spots for Britain during the Brexit ructions.
IHS Markit said its Household Finance Index (HFI) fell to 42.5 from 43.8, its lowest level since September 2017 as worries grew about job security, particularly in retail and manufacturing.
"Despite the latest labour market data showing historically-low unemployment and reasonably robust wage growth, weak confidence has acted to undermine these trends and led to belt-tightening at UK households," said Joe Hayes, an economist at survey compiler IHS Markit.
Still, households became a little more optimistic about their finances in the coming year, the survey showed.
EUR/USD could return to the 1.15 region in the medium term, suggested Senior Analyst at Danske Bank Aila Mihr.
“EUR/USD will look ahead to Thursday’s release of May’s flash PMIs. We look for a slightly bigger rebound in the Eurozone manufacturing PMI than consensus, which should break the negative trend seen since last summer of EUR/USD plummeting on disappointing flash Eurozone PMIs. In the bigger picture, a US-China trade deal is not in the cards before late Q3 and a recovery in Chinese PMIs not due before Q4. These are important prerequisites for a sustained uptick in EUR/USD. We forecast EUR/USD at 1.12 in 1M, 1.13 in 3M and then rising to 1.15 in 6M”.
According to the report from European Central Bank, the current account of the euro area recorded a surplus of €25 billion in March 2019, a decrease of €3 billion from the previous month (see Chart 1 and Table 1). Surpluses were recorded for goods (€24 billion), services (€8 billion) and primary income (€4 billion). These were partly offset by a deficit for secondary income (€11 billion).
In the 12 months to March 2019, the current account recorded a surplus of €328 billion (2.8% of euro area GDP), compared with a surplus of €376 billion (3.3% of euro area GDP) in the 12 months to March 2018. This decline was driven mainly by smaller surpluses for goods (down from €325 billion to €276 billion) and services (down from €109 billion to €101 billion), and by a larger deficit for secondary income (up from €143 billion to €156 billion). These developments were only partly offset by a larger surplus for primary income (up from €85 billion to €107 billion).
In the financial account, euro area residents made net acquisitions of foreign portfolio investment securities totalling €45 billion in the 12-month period to March 2019 (decreasing from €671 billion in the 12 months to March 2018). Non-residents made net sales of euro area portfolio investment securities totalling €101 billion (in comparison with net purchases of €408 billion).
U.S. Trade Representative Robert Lighthizer will visit Japan on May 24 to meet with Economy Minister Toshimitsu Motegi to accelerate trade talks ahead of a summit meeting scheduled a few days later, two sources with direct knowledge of the plan said on Monday.
After a late-April meeting between President Donald Trump and Prime Minister Shinzo Abe, Trump had said it was possible for the two countries to reach a new bilateral trade deal by the time he visits Tokyo in late May.
On Friday Trump angered foreign automakers by declaring that some imported vehicles and parts posed a national security threat, while delaying a decision for as long as six months on whether to impose tariffs to allow more time for trade talks with the EU and Japan.
Inflation in the euro zone is not at the level the European Central Bank wants it to be, ECB policymaker Klaas Knot.
Euro zone prices rose by 1.7 percent year-on-year in April from 1.4 percent in March. The acceleration offered some mild relief to the ECB, which targets inflation of just below 2 percent in the 19-nation eurozone.
Knot, the Dutch central bank governor, said the current situation was "not full convergence to below but close to 2%, I think. We have a figure in mind that is clearly closer to 2% than the number we have seen over the last five, six years or so. The only thing that we can do is to keep the pressure up, to make sure the economy continues to perform at high levels of capacity utilisation and the economy continues to print GDP numbers in excess of potential growth. At some point this chain of events will also lead to higher prices."
Axel Rudolph, Senior Technical Analyst at Commerzbank, noted EUR/USD could extend the drop to the 1.1110 region.
“EUR/USD continues to come off the 55 day moving average at 1.1243. Failure at the 1.1177 March low on a daily chart closing basis put the 1.1110 April low back on the map. Be advised that as long as 1.1110 holds, though, the pattern being traced out is a potential large bullish reversal pattern. Overhead lie the 55- and 100-day moving averages at 1.1243 and 1.1306 as well as the September-to-May resistance line at 1.1324. Further up meanders the 200 day moving average at 1.1392”.
Oil prices jumped on Monday after Saudi Arabia indicated a possible rollover of output curbs amid political supply risks, but that support is likely to be short-lived due to fundamental changes in the energy industry, an expert said.
“It’s alright to talk about supply-side risks, but that’s sort of near-term ... I don’t think expectations for oil prices have actually gone up,” said Scott Darling, J.P. Morgan’s head of Asia Pacific oil and gas research.
That’s because of the rise of U.S. shale energy and slowing demand due to global economic uncertainties, Darling told. J.P. Morgan expects OPEC to extend its oil output cuts to 2020.
J.P. Morgan’s forecast for Brent crude is $75 per barrel by the end of the second quarter of 2019. For the full year, however, Brent crude will average $71 a barrel for 2019 and will weaken to $60 a barrel from 2021, said Darling.
According to the report from Federal Statistical Office (Destatis). in April 2019 the index of producer prices for industrial products rose by 2.5% compared with the corresponding month of the preceding year. Economists had expected a 2.4% increase. In March 2019 the annual rate of change all over had been 2.4%.
Compared with the preceding month March 2019 the overall index increased by 0.5% in April 2019 (-0.1% in March 2019). Economists had expected a 0.3% increase
In April 2019 the price indices of all main industrial groups increased compared with April 2018. Energy prices, the development of which had the greatest impact on the growth of the overall index, rose by 6.6% (+1.0% compared to March 2019). On an annual basis electricity prices increased by 10.8%, prices of natural gas (distribution) by 6.1% and prices of petroleum products by 5.8%.
The overall index disregarding energy was 1.3% up on April 2018 and 0.3% up compared with March 2019.
Resistance levels (open interest**, contracts)
Price at time of writing this review: $1.1152
Support levels (open interest**, contracts):
- Overall open interest on the CALL options and PUT options with the expiration date June, 7 is 119298 contracts (according to data from May, 17) with the maximum number of contracts with strike price $1,1500 (9036);
Resistance levels (open interest**, contracts)
Price at time of writing this review: $1.2732
Support levels (open interest**, contracts):
- Overall open interest on the CALL options with the expiration date June, 7 is 39494 contracts, with the maximum number of contracts with strike price $1,3450 (3278);
- Overall open interest on the PUT options with the expiration date June, 7 is 38697 contracts, with the maximum number of contracts with strike price $1,2700 (4296);
- The ratio of PUT/CALL was 0.98 versus 0.98 from the previous trading day according to data from May, 17
* - The Chicago Mercantile Exchange bulletin (CME) is used for the calculation.
** - Open interest takes into account the total number of option contracts that are open at the moment.
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