Morning Call: Optimism About Global Trade Boosts Stocks


Overnight Markets And News

Jun E-mini S&Ps (ESM18 +0.58%) this morning are up +0.55% and European stocks are up +1.53% as global stock markets rally on reduced concerns for a trade war. U.S. Treasury Secretary Mnuchin said he and his Chinese counterpart have been discussing the trade deficit between the two countries and were committed to finding a mutually agreeable way to reduce the trade gap and help China avoid tariffs. Increased M&A activity gave U.S. and European stocks a boost as well after the Dutch company Akzo Nobel NV sold its chemical unit to Carlyle Group for 10.1 billion euros ($12.5 billion). Asian stocks settled higher: Japan +2.65%, Hong Kong +0.79%, China +1.05%, Taiwan +1.35%, Australia +0.72%, Singapore +0.79%, South Korea +0.46%, India +0.33%.

The dollar index (DXY00 +0.45%) is up +0.42%. EUR/USD (^EURUSD -0.42%) fell back from a 1-1/4 month high in overnight trade and is down -0.35% after Eurozone Mar economic confidence fell to a 6-month low and after Eurozone Feb M3 money supply rose +4.2% y/y, the smallest pace of increase in 3 years. USD/JPY (^USDJPY +0.35%) is up +0.31%.

Jun 10-year T-note prices (ZNM18 -0-015) are little changed, down -0.5 of a tick.

Eurozone Mar economic confidence fell -1.6 to a 6-month low of 112.6, weaker than expectations of -0.8 to 113.3. The Mar business climate indicator fell -0.14 to 1.34, weaker than expectations of -0.12 to 1.36.

Eurozone Feb M3 money supply rose +4.2% y/y, weaker than expectations of +4.6% y/y and the smallest pace of increase in 3 years.

The German Feb import price index fell -0.6% m/m, weaker than expectations of -0.3% m/m and the biggest decline in 8 months.

Japan Feb PPI services prices rose +0.6% y/y, weaker than expectations of +0.7% y/y and the slowest pace of increase in 6 months.

U.S. Stock Preview

Key U.S. news today includes: (1) Jan S&P CoreLogic composite-20 home price index (expected +0.6% m/m and +6.1% y/y, Dec +0.64% m/m and +6.3% y/y), (2) Mar Richmond Fed manufacturing index (expected -6 to 22, Feb +14 to 28), (3) Conference Board Mar U.S. consumer confidence (expected +0.2 to 131.0, Feb +6.5 to 130.8), (4) Atlanta Fed President Raphael Bostic (voter) speaks at an economic policy conference in Atlanta, (5) Treasury auctions $35 billion of 5-year T-notes.

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