Stock Market Update

The S&P 500 futures are down three points and are trading fractionally below fair value, the Nasdaq 100 futures are up 14 points and are trading 0.1% above fair value, and the Dow Jones Industrial Average futures are down 100 points and are trading 0.2% below fair value.

Contracts linked to the Dow Jones Industrial Average and the S&P 500 are lower while the Nasdaq 100 futures move higher, boosted by ongoing strength in NVIDIA (NVDA). Shares are up more than 2.0% ahead of the open following yesterday's nearly 7% rebound from recent losses. 

FedEx (FDX) and Rivian Automotive (RIVN) are also notable pre-open winners, up 13% and 39%, respectively. FDX reported better-than-expected earnings and indicated that the demand environment is expected to moderately improve throughout FY25. 

RIVN trades up ahead of the open after announcing plans for a joint venture with Volkswagen Group (VWAGY).

Treasury yields are moving higher this morning, keeping pressure on equities. The 10-yr note yield is up five basis points to 4.29% and the 2-yr note yield is up one basis point to 4.74%.

Earlier, the weekly MBA Mortgage Applications Index reflected a 0.8% increase versus last week's 0.9% increase. Other data out today include:

• 10:00 ET: May New Home Sales (Briefing.com consensus 650,000; prior 634,000)
• 10:30 ET: Weekly crude oil inventories (prior -2.55 mln)

In corporate news:

• FedEx (FDX 291.03, +34.65, +13.5%): beats by $0.07, reports revs in-line; guides FY25 EPS in-line, revs in-line; Co is conducting an assessment of the role of FedEx Freight in its portfolio structure; Expect the demand environment to moderately improve throughout FY25
• General Mills (GIS 64.40, -2.86, -4.3%): beats by $0.02, misses on revs; raises dividend
• Rivian Automotive (RIVN 16.62, +4.66, +39.0%): and Volkswagen Group (VWAGY) announce plans for joint venture to create industry-leading vehicle software technology and for strategic investment by Volkswagen; discloses convertible promissory note purchase agreement
• Apple (AAPL 210.79, +1.72, +0.8%): upgraded to Buy from Neutral at Rosenblatt
• Southwest Air (LUV 27.60, -0.91, -3.2%): lowers Q2 RASM outlook
• Whirlpool (WHR 104.04, +16.98, +19.5%): Bosch considering acquisition of Whirlpool (WHR), according to Reuters
• Chipotle Mexican Grill (CMG 65.50, -0.16, -0.3%): begins trading today after 50-for-1 stock split 

Reviewing overnight developments:

• Equity indices in the Asia-Pacific region ended the midweek session on a higher note. Japan's Nikkei: +1.3%, Hong Kong's Hang Seng: +0.1%, China's Shanghai Composite: +0.8%, India's Sensex: +0.8%, South Korea's Kospi: +0.6%, Australia's ASX All Ordinaries: -0.7%.
  • In economic data:
    • Australia's May MI Leading Index 0.0% m/m (last 0.0%) and May CPI Indicator 4.0% yr/yr (expected 3.8%; last 3.6%)
    • Singapore's May Industrial Production 1.1% m/m (expected 1.8%; last 7.5%); 2.9% yr/yr (expected 2.0%; last -1.2%)
  • In news:
    • The Bank of Japan will reportedly consider hiking rates at all upcoming meetings, including the one scheduled for July. The central bank is expected to announce a reduction to its monthly purchases.
    • Australia's CPI accelerated to 4.0% yr/yr in May, leading to renewed speculation about a potential August rate hike from the Reserve Bank of Australia.
    • China's 10-yr yield has slipped back toward its low from late April in the 2.20% area.
    • South Korea's finance minister expects that exports will return to record levels imminently.
• Major European indices are mostly lower. STOXX Europe 600: -0.2%, Germany's DAX: UNCH, U.K.'s FTSE 100: -0.1%, France's CAC 40: -0.7%, Italy's FTSE MIB: -0.5%, Spain's IBEX 35: -0.5%.
  • In economic data:
    • Germany's July GfK Consumer Climate -21.8 (expected -19.4; last -21.0)
    • U.K.'s June CBI Distributive Trades Survey -24 (expected 1; last 8)
    • France's June Consumer Confidence 89, as expected (last 90). May jobseeker total 2.816 mln (last 2.775 mln)
    • Swiss June ZEW Expectations 17.5 (last 18.2)
  • In news:
    • European Central Bank policymaker Rehn said that rate changes are a possibility at every upcoming ECB meeting, which has raised hopes for another rate cut in July.
    • The ECB has reportedly started the review of its monetary policy strategy, which will be publicized in the second half of 2025.
    • Outgoing Dutch Prime Minister Rutte will be the next secretary general of NATO, as expected.