Thursday Morning Reads
- Little Progress
- Fluid Situation
- It's the Buybacks
- China has put soybean purchases from the US on hold amid trade dispute (FXI, DBA). Bloomberg Report
- Market Prepper
- Vice President Mike Pence will speak with Canadian Prime Minister Justin Trudeau regarding trade and Huawei (EWW, EWC). Reuters Report
- Canada has introduced legislation to ratify USMCA trade agreement (EWW, EWC). Reuters Report
- There are more a Democratic Presidential candidates supportive of impeaching President Trump following statements from Robert Mueller. NY Times Report
- Israel will hold another election after Prime Minister Benjamin Netanyahu failed to form a government (EIS). NY Times Report
- Trade Update
- Futures edge higher after days of falls
- Barclays latest to cut Tesla price target
- Pentagon aims to cut reliance on Chinese rare earths
- Europe faces U.S. pressure on Iran workaround
- Disney sees 'difficulty' filming in Georgia
- Delek buys Chevron U.K. oil fields for $2B
- Ohio House passes controversial energy bill, moves to Senate
- Disneyland opens 'Star Wars' park with dedication
- DOJ wants T-Mobile, Sprint to set up for fourth carrier - Bloomberg
- Gazprom reports Q1 results
- Uber inks partner for cheaper car ownership
- NGL Energy Partners EPS misses by $0.09, misses on revenue
Todays Top Open Interest Changes:
Investors today will monitor a flurry of economic figures, including the latest weekly jobless claims and a second reading of GDP for Q1, expected to show 3.0% annualized growth compared to 3.2% in the first estimate. Futures are heading higher ahead of the data, following last night's slump that came amid a protracted trade dispute and intensifying yield curve. Contracts tied to the DJIA are now indicating a 75 point advance, while 10-year Treasury notes eased overnight, but at 2.27%, they are still within touching distance of their September 2017 lows.
"The Pentagon is working to reduce U.S. reliance on Chinese rare earth minerals after recent trade war threats," according to spokesman Lt. Col. Mike Andrews. The Defense Department is now seeking new federal funds to bolster domestic production, with China accounting for 80% of U.S. rare earth imports between 2004 and 2017. It's not so much about the deposits, but more about their processing. Efforts to build U.S. plants are still in the early stages and lack unified support from Congress and the White House.
Escalating the battle over the fate of the Iran nuclear accord, the Trump administration has warned European allies that its vehicle to sustain trade with Tehran, and anyone associated with it, could be barred from the U.S. financial system if it goes into effect. Germany, France and the U.K. created Instex in January to allow companies to trade with Iran without the use of U.S. dollars or American banks - thus allowing them to get around wide-ranging U.S. sanctions.
It's the first release of economic data from Venezuela's central bank in nearly four years. Inflation spiraled out of control to 130,060% in 2018 and hit 862.6% in 2017, while the economy shrank 22.5% during the third quarter of 2018 from the same period a year earlier. Oil export earnings last year also dropped 5.6% Y/Y to $29.8B. The government of President Maduro halted the publication of economic indicators in 2015 as the OPEC nation's socialist system began to unravel in response to the global decline in oil prices.
ExxonMobil (NYSE:XOM) shareholders rejected a proposal that would have split the roles of the CEO and chairman, and defeated measures that urged the board to create a special committee on climate change. Separately, Delek Group's (OTCPK:DLKGF) Ithaca Energy unit agreed to buy North Sea oil and gas fields from Chevron (NYSE:CVX) for about $2B. Arab leaders are also gathering today in Saudi Arabia for an emergency summit as Riyadh delivers a strong message to Iran that regional powers will defend their interests following this month's attacks on Gulf oil assets.
Uber Technologies (NYSE:UBER) will report its first quarterly earnings since its market debut a few weeks ago. Investors will be looking out for more details on the company's numbers, any indication on future profitability and its strategies after smaller rival Lyft (NASDAQ:LYFT) forecast that its losses would peak this year in its first corporate results as a public company. Ahead of the announcement, Uber inked a partnership with vehicle subscription service Fair to lower the cost of car ownership for its drivers.
Tesla (NASDAQ:TSLA) is down another 1% premarket to $188/share after Barclays cut its price target on the stock to $150 (from $192) following the latest comments from Elon Musk. "While our demand is strong, we have a lot of vehicle deliveries to catch up to in order to have a successful quarter," he wrote in a company-wide email reported by multiple media outlets. Barclays analyst Brian Johnson appears skeptical, saying, "Model 3 demand is stagnating in the U.S., the company still doesn't have a path to significant auto profitability and solar storage installations have declined sequentially over the past two quarters."
More in the film industry are wading into the fetal-heartbeat bill debate, with Bob Iger saying it would be "very difficult" for Disney (NYSE:DIS) to keep filming in Georgia if it enacts its new abortion law (Black Panther and Avengers: Endgame were filmed in the state). "I think many people who work for us will not want to work there, and we will have to heed their wishes in that regard," he told Reuters. Along with Netflix (NASDAQ:NFLX) "rethinking" its investments in Georgia, at least two projects - Amazon (NASDAQ:AMZN) series The Power and Lionsgate (NYSE:LGF.A) feature Barb and Star Go to Vista Del Mar - have said they will relocate their productions.
What else is happening...
In Asia, Japan -0.3%. Hong Kong -0.4%. China -0.3%. India +0.7%.
In Europe, at midday, London +0.5%. Paris +0.4%. Frankfurt +0.4%.
Futures at 6:20, Dow +0.3%. S&P +0.4%. Nasdaq +0.4%. Crude +0.2% to $58.92. Gold flat at $1280.70. Bitcoin +0.6% to $8730.
Ten-year Treasury Yield +3 bps to 2.27%
Today's Economic Calendar
8:30 GDP Q1
8:30 International trade in goods
8:30 Retail Inventories (Advance)
8:30 Wholesale Inventories (Advance)
8:30 Initial Jobless Claims
8:30 Corporate profits
10:00 Pending Home Sales
10:30 EIA Natural Gas Inventory
11:00 EIA Petroleum Inventories
12:00 PM Fed’s Clarida: “Sustaining Maximum Employment and Price Stability”
4:30 PM Money Supply
4:30 PM Fed Balance Sheet