April 23, 2019

Daily Market Review, Tuesday, April 23, 2019

Daily Market Review, Tuesday, April 23, 2019

Asia

Asian markets are coming out of Easter Weekend with an end to Trump’s Iran Oil Sanctions waiver staring them in the face. Besides pushing oil prices (see below), stock markets have been reacting negatively as the rush is on to “stock up” – India, China, Japan and South Korea being Iran’s main clients. So far, the Australian dollar continued south during the session, while the yen spiked nearly up to the 0.9 level before returning to its 10-day flatlining region. Japan’s CPIs last night remained mainly flat, climbing a 1/10th YoY after the nation’s preliminary manufacturing PMI Thursday provided a 0.3% climb to 49.5 in April.

Europe

Europe departed into the holiday with excellent data, which is expected to propel trading today. Service and composite PMIs in Germany and France both climbed into the green – going from contractionary to expansion in France. Manufacturing for both economies grew, too, but failed to exceed expectations. For the zone, however, data is still red and falling. And retail in the UK soared from -0.2% in February to +1.6% in March MoM, hitting a 2.5 year high. Still, not all was rosy, Italian consumers and businesses on Friday expressing low confidence measures.

US

As mentioned, following the devastating publication of the Mueller report last week, President Trump is attacking oil with a vengeance. The administration yesterday announced it would not renew waivers on sanctions against countries purchasing oil from Iran. The oil price increase should bode well for indexes, currently stuck in a rut despite earnings season being under full sway. Yesterday, home sales data showed a drop from February’s 5.48mn units to 5.21 – well below expectations, and housing starts and building permits on Friday were little better – all falling below anticipated results. On Thursday, on the other hand, the US reported excellent retail sales – spiking from an 0.2% contraction in February to 1.6% growth in March MoM, and nearly doubling to 6.2% YoY – and jobless claims falling this past week despite expectations of an increase. News in Canada was also good, retail sales up from negative ½ percents (sic) in January to positive greens in February and employment change up another 13k jobs.

Commodities

Besides throwing a spanner directly into OPEC’s production cut agreement by forcing Saudi Arabia to take up the slack from anti-Iran sanctions, Trump’s announcement that discontinuing waivers from purchasing oil from that nation has created a rush in Asia that pushed WTI up by nearly $2½ per barrel over the weekend. Although some profit taking concluded the Asian session, the trend is still bullish. Bullishness also continues to describe Bitcoin, the crypto now resting upon support at 5250 and currently on its way to breaking through 5400. Beta users can now shop on eBay using the Moon payment processor start-up, and JPMorgan is expanding its blockchain project for interbank information transfer – currently servicing about 200 odd branches.

Shares

American Express on Thursday beat earnings expectations by 0.04%, revenues surprising by nearly $100mn to the downside, while Check Point did somewhat better – its $1.32 EPS beating expectations by 0.01%, while revenues beat expectations by $0.65mn. Its name less in the mud than Facebook, today Twitter takes the headlines before market opens, with EPS expected to be down 6 cents on the year. Alongside, expect Proctor & Gamble to report both earnings and revenue up YoY, and Coke to be down on earnings, but up on revenue by a healthy 4%. The height of anxiety, though will be for Boeing, tomorrow, in light of its news-mongering over the past year. Earnings are expected to drop 15%, and many analysts say the figure is optimistic.

Events

12:30 PM GMT – CanadaWholesale Sales (Feb)
12:55 PM – USRedbook Index, Housing Price Index, New Home Sales & Richmond Fed Manufacturing Index (Apr) at 14:00
14:00 PM GMT – EU Consumer Confidence (Apr)
20:30 PM GMT – OILAPI Weekly Crude Oil Stock (Apr 19)
23:50 PM GMT – JapanCorporate Service Price, and Industry Activity, Leading Economic Index & Coincident Index at 04:30 (+1)
00:30 AM GMT (+1) – AustraliaCPIs (Q1)

For more, visit our Economic Calendar