Daily Markets: Skepticism for peace talks ahead of ADP March jobs data


The big picture today

Asia-Pacific equity indices ended today’s session higher across the board except for the Japanese Nikkei which fell 0.80%. Korea’s KOSPI gained 0.21%, Australia’s ASX All Ordinaries rose 0.68%, Taiwan’s TAIEX rose 1.09%, while India’s Sensex and Hong Kong’s Hang Seng gained respectively 1.28% and 1.39%, while China’s Shanghai Composite rebounded 1.96% from earlier covid lockdown losses as Shanghai is halfway through its first phase of wide lockdowns from the city. By midday, major European equity indices are down across the board, and US futures are pointing to a weak market open later this morning.

The current containment in Shanghai does not seem to have the type of impact feared by the markets. That said, Russian and Ukrainian concerns are still front and center for investors. While peace talks are underway and Russia has pledged to shift its focus elsewhere in Ukraine, there are doubts about its willingness to follow through on those statements, which continues to baffle investors even then. that the questions of European energy dependence begin to be addressed.

While investors keep one eye on Europe, the other is fixed on our markets and our economy. While Q1 GDP estimates have bounced around this quarter from nearly 2% to -0.25%, the current estimate stands at 0.9%, lower than longer-term trends. term, but not alarming. What alarmed investors yesterday was the temporary inversion in the yield curve between 2-year and 10-year Treasuries, which has traditionally been seen as an indicator of recession. Before investors jump to conclusions, questions about the economic push-pull between the post-Omicron reopening and the Russian-Ukrainian war need to be answered. The upcoming March quarter earnings season should bring some clarity to these questions.

Data download

International economy

This morning, a number of Eurozone sentiment indices refreshed for March as Business Sentiment (1.7 vs. 1.8 Feb), Consumer Confidence (-18.7 vs -8, February 8) and economic confidence (108.5 vs. 113.9 February) were updated. Business sentiment showed a slight upside surprise to estimates while economic confidence came in weaker than expected. Given the ongoing war in Ukraine and its economic impacts, and the general distrust in Europe regarding Russia’s willingness to follow through on its own political pronouncements regarding its actions in Ukraine, a drop in these numbers is understandable.

Later this morning at 8:00 a.m. ET, the German Consumer Price Index for March will be updated with expectations set for an increase to 6.60% from February’s 5.50%, once again in due to rising energy costs.

Domestical economy

At 7 a.m. ET, weekly updates on the 30-year average mortgage rate and the progress of weekly mortgage applications will be released. Recent trends indicate that rates will hold if not rise, and given high rates, mortgage application growth, while volatile, will continue its downward trend.

8:15 a.m. ET will see the March update of the ADP employment survey. A drop to 444,000 jobs is expected from February’s figure of 475,000.

8:30 a.m. ET will see this final update for Q4 2021 GDP. No further adjustments are expected to the reported growth of 5.60% for the last quarter of 2021.

10:30 a.m. ET will see the release of a number of weekly energy-related releases, including refinery inventory, production and utilization updates.

Markets

Reported progress in peace talks between Russia and Ukraine drove oil prices steadily lower and helped propel the CNN Money Fear & Greed Index to neutral, up from Fear in the week. latest, giving equities another day of positive action. The S&P 500 ended yesterday up 1.2%, while the Nasdaq Composite rose 1.8% and the Russell 2000 rose 2.7%, while the Dow Jones Industrial Average added 1.0%. Including these moves, here’s how the major market indicators stack up on a year-over-year basis:

  • Dow Jones Industrial Average: -2.9%
  • S&P 500: -2.8%
  • Nasdaq compound: -6.06%
  • Russell 2000: -5.0%
  • Bitcoin (USD-BTC): -1.0%
  • Ether (ETH-USD): -9.8%

Stocks to Watch

Prior to the start of trading for stocks listed in the United States, BioNTech (BNTX), Five Below (FIVE), MSM Industrial (MSM), and Paychex (PAYX) must publish their quarterly results.

Shares of a memory computer company Micron (MU) rose in spare parts trading last night after the company’s quarterly earnings beat expectations and forecasts also beat estimates. Micron shared that memory and storage revenues have outpaced the rest of the semiconductor industry for the past two decades, and it expects this trend to continue over the next decade. thanks to the continued progress in the adoption of AI, 5G and electric vehicles. In particular, Micron’s shared data center is now the largest memory and storage market, eclipsing mobile, and it sees growth in data center demand outpacing the broader memory and storage market. over the next decade due to age-old drivers of cloud and IT investments.

HR (HR) announced mixed quarterly results with revenue slightly below consensus expectations while the company beat EPS. Although it issued an upward guidance for the current quarter, RH issued a full-year revenue guidance that implies $3.95-4.02 billion versus the consensus of $4.4 billion. of dollars. On its earnings call, management discussed plans to launch “The World of HR”, an online portal where clients can “explore and be inspired by the depth and dimension of our brand” as part of the the company’s broader plan to address the global HR ecosystem which it sees as a $7 trillion to $10 trillion opportunity.

Despite an increase in auto ship sales of 21.2% year-on-year, Fluffy (CHWY) missed January quarter consensus expectations for revenue and EPS and guided the current quarter below expectations. Among the factors that contributed to its lower-than-expected results include cost inflation and high inbound freight costs, and shared that while it sees improved labor availability and labor costs inbound shipping, outbound shipping costs “remain high”.

Crossroads (CRRFY) plans to install more than 700 electric vehicle charging stations and 5,000 charging stations in its French hypermarkets and Carrefour Market supermarkets by 2025.

Samsung Electronics (SSNLF) and Western Digital (WDC) signed a memorandum of understanding to collaborate on the standardization and adoption of next-generation storage placement, processing, and data array (D2PF) technologies.

Electric Mitsubishi (MIELY) Shared it has developed an artificial intelligence technology that identifies individuals captured with multiple surveillance cameras in a tenth of the time of conventional AI.

IPOs

Shares of Genius Group (GNS), Rail Vision (RVSN) and Wearable Devices (WLDS) are expected to price their IPO bids this week. Readers who want to dig deeper into the schedule of upcoming IPOs should visit Nasdaq’s Latest and Upcoming IPOs page.

After today’s market close

There are no corporate earnings reports that will impact the market one way or the other. Those interested in learning more about which companies release their reports when head to the Nasdaq earnings calendar.

on the horizon

Thursday, March 31st

  • Korea: Industrial production – February
  • Japan: Industrial production – February
  • China: CFLP manufacturing and non-manufacturing PMI – March
  • Germany: Retail sales – February
  • United Kingdom: GDP for the 4th quarter of 2021 (final)
  • Euro zone: unemployment rate – February
  • United States: Initial and Continuing Weekly Unemployment Claims
  • United States: consumption and personal expenditure – February
  • United States: Chicago PMI – March
  • United States: EIA Weekly Natural Gas Inventories

friday april 1st

  • Japan: Tankan Large Manufacturing & Non-Manufacturing Index – 1Q 2022
  • Japan: Markit/JMMA manufacturing PMI – March
  • China: Markit/Caixin manufacturing PMI – March
  • Euro zone: Markit PMI Manufacturing – March
  • United Kingdom: CIPS manufacturing PMI – March
  • Euro zone: Consumer price index – March
  • United States: Employment report – March
  • United States: Markit manufacturing PMI – March
  • United States: construction spending – February
  • United States: ISM manufacturing index – March

Thought of the day

“I think if I had quit years ago, I would never have known what I was capable of.” ~Tom Small

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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