June S&P 500 E-Mini futures (ESM24) are trending up +0.35% this morning after three major U.S. benchmark indices ended the regular session lower, with investors awaiting the release of the Federal Reserve’s favorite inflation gauge and other economic data due later this week to assess the Fed’s policy path.
In yesterday’s trading session, United Parcel Service (UPS) plunged over -8% and was the top percentage loser on the S&P 500 as investors deemed its 2026 revenue target difficult to achieve. Also, International Paper (IP) slumped more than -6% after DS Smith confirmed it was in preliminary talks with the company regarding a potential takeover offer. In addition, Westport Fuel Systems (WPRT) fell over -5% after the company posted mixed Q4 results. On the bullish side, McCormick (MKC) surged more than +10% and was the top percentage gainer on the S&P 500 after the spice maker reported stronger-than-expected Q1 results. Also, Seagate Technology Holdings (STX) gained over +7% after Morgan Stanley upgraded the stock to Overweight from Equal Weight with a price target of $115.
Economic data on Tuesday showed the U.S. CB consumer confidence index unexpectedly fell to a 4-month low of 104.7 in March, weaker than expectations of 106.9. Also, U.S. February durable goods orders rose +1.4% m/m, and U.S. February core durable goods orders rose +0.5% m/m, stronger than expectations of +1.2% m/m and +0.4% m/m, respectively. In addition, the U.S. S&P/CS HPI Composite - 20 n.s.a. rose +6.6% y/y in January, in line with expectations. Finally, the U.S. March Richmond Fed manufacturing survey unexpectedly fell to -11, weaker than expectations of -5.
Meanwhile, the focus remains on a crucial reading of the U.S. core personal consumption expenditures price index, the Fed’s preferred inflation gauge. The data is scheduled for release on Friday when the U.S. markets will be closed in observance of the Good Friday holiday.
“The big number is Friday. That’s the number everyone’s going to pay attention to and whatever happens in the meantime is going to be noise, so I don’t anticipate a whole lot happening until we get that data point,” said Stephen Massocca, senior vice president at Wedbush Securities.
U.S. rate futures have priced in an 8.9% chance of a 25 basis point rate cut at the next FOMC meeting in May and a 64.2% chance of a 25 basis point rate cut at the June FOMC meeting.
Today, investors will likely focus on U.S. Crude Oil Inventories data. Economists estimate this figure to be -0.700M, compared to last week’s value of -1.952M.
In addition, market participants will be looking toward a speech from Federal Reserve Governor Christopher Waller.
On the earnings front, notable companies like Carnival (CCL), Jefferies (JEF), and H.B. Fuller (FUL) are set to report their quarterly figures today.
In the bond markets, United States 10-year rates are at 4.242%, up +0.21%.
The Euro Stoxx 50 futures are down -0.04% this morning as investors digested the latest batch of regional economic data and looked ahead to Friday’s release of the Fed’s preferred inflation gauge. Energy and travel stocks underperformed on Wednesday, while retail stocks gained ground. Meanwhile, preliminary data from the National Statistics Institute showed on Wednesday that Spanish annual inflation accelerated in March. Separately, official data showed Wednesday that the Eurozone’s economic sentiment increased in March. In corporate news, H & M Hennes & Mauritz Ab (HMB.S.DX) surged over +13% after the Swedish retailer reported a much stronger-than-expected Q1 operating profit.
European Central Bank board member Piero Cipollone stated Wednesday that the ECB might be able to cut interest rates “swiftly” despite wage rebound. “If incoming data confirm the scenario foreseen in the March projections, we should stand ready to swiftly dial back our restrictive monetary policy stance,” Cipollone said in a speech in Brussels.
France’s Consumer Confidence, Spain’s CPI (preliminary), Eurozone’s Consumer Confidence, and Eurozone’s Business and Consumer Survey were released today.
The French March Consumer Confidence stood at 91, stronger than expectations of 90.
The Spanish March CPI came in at +0.8% m/m and +3.2% y/y, stronger than expectations of +0.6% m/m and +3.1% y/y.
Eurozone March Consumer Confidence was at -14.9, in line with expectations.
Eurozone March Business and Consumer Survey arrived at 96.3, in line with expectations.
Asian stock markets today settled mixed. China’s Shanghai Composite Index (SHCOMP) closed down -1.26% and Japan’s Nikkei 225 Stock Index (NIK) closed up +0.90%.
China’s Shanghai Composite Index closed sharply lower today, falling below the psychologically important 3,000 level. Technology stocks led the declines on Wednesday. Real estate, healthcare, and consumer staples stocks also retreated. Meanwhile, concerns regarding a new U.S. law, the Inflation Reduction Act, also dampened sentiment, with China contending that the act encompasses discriminatory subsidies that unfairly exclude Chinese-manufactured electric vehicles. In other news, foreign investors offloaded a net 7.2 billion yuan ($996 million) worth of Chinese shares via Stock Connect on Wednesday, marking the largest daily outflow since mid-January. On the positive side, data from the National Bureau of Statistics showed on Wednesday that China’s industrial profits jumped 10.2% in the first two months of the year, further indicating that the world’s second-largest economy is on a firmer footing. Also, state media reported that China’s President Xi Jinping convened with U.S. executives and academics at the Great Hall of the People in Beijing on Wednesday. In corporate news, Alibaba Group Holding Ltd. fell over -2% following the cancellation of a $1 billion-plus initial public offering for its Cainiao logistics arm. Also, BYD Co. slumped more than -6% in Hong Kong after the Chinese EV giant reported weaker-than-expected 2023 profit.
Japan’s Nikkei 225 Stock Index closed higher today. Real estate stocks led the gains on Wednesday after a government survey revealed the country’s land prices surged at the swiftest rate in 33 years in 2023. Export-oriented stocks also advanced as the yen briefly hit its lowest level against the dollar since 1990 after Bank of Japan board member Naoki Tamura said financial conditions would stay accommodative. However, the yen cut some of its losses after Japanese Finance Minister Shunichi Suzuki said he would take “decisive steps” to slow the currency’s slump if needed. Meanwhile, BOJ Governor Kazuo Ueda said on Wednesday that the central bank would closely monitor currency moves while also emphasizing the importance of sustaining an accommodative monetary policy to support the economy for the time being. In corporate news, Nihon Kohden rose over +1% following the company’s announcement that it anticipates recording an extraordinary income of 4 billion yen in Q4. The Nikkei Volatility, which takes into account the implied volatility of Nikkei 225 options, closed up +2.99% to 19.28.
Pre-Market U.S. Stock Movers
Direct Digital Holdings (DRCT) plummeted about -42% in pre-market trading after the company reported downbeat Q4 results and issued below-consensus FY24 revenue guidance.
GameStop Corp (GME) slumped over -15% in pre-market trading after the company reported weaker-than-expected Q4 results.
nCino (NCNO) climbed more than +14% in pre-market trading after the company reported stronger-than-expected Q4 adjusted EPS and provided solid full-year adjusted EPS guidance.
Merck & Company (MRK) gained over +4% in pre-market trading after announcing that the U.S. FDA approved its Winrevair drug.
Roivant Sciences (ROIV) rose more than +5% in pre-market trading after S&P Dow Jones Indices announced that the company would replace Sunrun in the S&P MidCap 400 index, effective April 1st.
You can see more pre-market stock movers here
Today’s U.S. Earnings Spotlight: Wednesday - March 27th
Cintas (CTAS), Carnival Corp (CCL), Jefferies Financial (JEF), RH (RH), Braze (BRZE), H.B. Fuller (FUL), Sprinklr (CXM), Unifirst (UNF), MillerKnoll (MLKN), Rumble (RUM), Verint (VRNT), Tsakos Energy (TNP), Franklin Covey (FC), Altimmune (ALT), Consolidated Water (CWCO), Celcuity (CELC), Sonida Senior Living (SNDA).
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