11th May 2015 10:30
WASHINGTON (Alliance News) - Trading in the US index futures shows that Wall Street stocks are pointing to a lower opening on Monday. Global cues are mixed, with Asian stocks closing mostly higher, thanks to a rate cut announced by China and the US non-farm payrolls report, while the European markets are mixed. Given the lack of any major economic news, the domestic markets may look ahead to overseas cues, including the Eurogroup finance ministers' meet in Brussels and the Bank of England's monetary policy announcement. Commodities are mostly lower amid the dollar strength.
At 6:15 am ET, the Dow futures are slipping 19 points, the S&P 500 futures are moving down points 2.75 and the Nasdaq 100 futures are declining 4 points.
US stocks meandered to a mixed close in the week ended May 8th, as positive monthly non-farm payrolls report helped to offset concerns triggered by some mixed economic data and earnings and valuation concerns.
Consumer and manufacturing readings take the center stage in the unfolding week, as traders keep a close eye on each incoming economic evidences. The Commerce Department's retail sales report for April, the weekly jobless claims report, the results of the University of Michigan's consumer sentiment index for May, the Federal Reserve's industrial production report for April and the results of the Federal Reserve's empire state manufacturing survey for May are among the closely watched reports of the week.
The Treasury Budget for April, the Labor Department's import and export prices for April, the Commerce Department's business inventories report for March, the Labor Department's producer prices report for April, the results of the Treasury auctions of 3-year and 10-year notes and 30-year bonds round up the economic events of the week.
In corporate news, a Bloomberg report stated that Visa (V) is in preliminary talks to buy its former subsidiary Visa Europe in a deal that may be valued at as much as USD20 billion.
Another Bloomberg reported noted TPG Capital is close to a deal to buy commercial property brokerage Cushman & Wakefield for about USD2 billion and combine it with DTZ Group
UAL (UAL) announced that its consolidated traffic edged up 0.4% and capacity rose 2.7%, while its load factor fell 1.9 percentage points.
DryShips (DRYS), FMC Corp. (FMC), MBIA (MBI) and Rackspace (RAX) are among the companies due to release their quarterly results after the close of trading.
Most Asian markets advanced, helped by positive reaction to the US non-farm payrolls report released last Friday and the unexpected interest rate cut announced by the People's Bank of China. The Indonesian, Malaysian, Taiwanese and the Australian market bucked the uptrend with modest losses.
The Japanese market opened strongly and moved sideways for the rest of the session, as the yen weakened. The Nikkei 225 average ended 241.72 points or 1.25% higher at 19,621. Most export stocks advanced, with the exception of technology exporters.
The Chinese Shanghai Composite Index started on a cautious note but advanced steadily throughout the session before ending up 127.67 points or 3.04% at 4,334. Hong Kong's Hang Seng Index ended at 27,718, up 140.86 points or 0.51%. Meanwhile, Australia's All Ordinaries ended down 7.80 points or 0.14% at 5,628. On the economic front, the People's Bank of China cut the benchmark lending and deposit rates by 0.25 percentage points to 5.1% and 2.25%, respectively. This marked the third cut since November 2014 amid signs that the domestic economic momentum is losing steam. Consumer price inflation report released over the weekend showed that consumer prices rose 1.5% year-over-year on slightly higher food prices. Core consumer prices were essentially unchanged at 1.5%.
A report released by the National Australia Bank showed that business confidence in Australia was unchanged in April. The business confidence index was unchanged at 3. On the other hand, the business conditions index fell slightly to 4 in April.
European stocks are mixed, with the French CAC 40 Index trading notably lower and the German DAX Index is experiencing a moderate loss, while the UK's FTSE 100 Index is trading with notable gains, as a decisive election result announced last week continuing to buoy sentiment. The mood was generally wary, as Greece is set to meet another IMF repayment deadline on Tuesday.
Eurogroup finance ministers are scheduled to meet later day to discuss a Greek debt deal, even as the Greek government is intransigent in making adjustments to its austerity program.
The Bank of England's Monetary Policy Committee is set to announce its monetary policy decision later today. The meeting has been postponed from the first week owing to the nation's general elections. Economists expect no change either in the rates or in the size of the bank's asset purchase program. The focus now shifts to the Bank of England's inflation report due on Wednesday.
In corporate news, Air France-KLM said its load factor edged down 0.6 percentage points year-over-year to 84.2%. Capacity rose 0.3%, while traffic fell 2%. GEA Group reported a decline in its first quarter profits, although revenues from continuing operations climbed year-over-year. Revenues were 5.9% higher.
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