Stock Market Update

The S&P 500 futures are up eight points and are trading 0.2% above fair value, the Nasdaq 100 futures are up 82 points and are trading 0.4% above fair value, and the Dow Jones Industrial Average futures are down 54 points and are trading 0.1% below fair value.

Contracts linked to the S&P 500 and Nasdaq 100 are higher thanks to pre-open rebound action in chipmakers and mega cap names. These stocks led yesterday's sharp declines that had the S&P 500 and Nasdaq Composite close 1.4% and 2.8% lower, respectively. 

Treasury yields are slightly higher. The 10-yr note yield is up three basis points to 4.18% and the 2-yr note yield is up three basis points to 4.46%. 

Today's economic lineup features:

• 8:30 ET: Weekly Initial Claims (Briefing.com consensus 225,000; prior 222,000), Continuing Claims (prior 1.852 mln), and July Philadelphia Fed survey (Briefing.com consensus 2.9; prior 1.3)
• 10:00 ET: June Leading Indicators (Briefing.com consensus -0.3%; prior -0.5%)
• 10:30 ET: Weekly natural gas inventories (prior +65 bcf)
• 16:00 ET: May Net Long-Term TIC Flows (prior $123.1 bln)

In corporate news:

• United Airlines (UAL 47.69, +0.75, +1.6%): beats by $0.21, reports revs in-line, TRASM down 2.4%; reaffirms FY24 EPS guidance
• Steel Dynamics (STLD 130.01, -0.06, -0.1%): misses by $0.01, beats on revs; expects steel pricing to firm
• Discover Financial Services (DFS 146.08, +4.67, +3.3%): beats by $2.98, beats on revs
• Alcoa (AA 37.22, +0.41, +1.1%): reports Q2 results in-line with last week's guidance
• Beyond Meat (BYND 6.22, -0.95, -13.3%): lower on report it has engaged with bondholders for restructuring talks, according to WSJ
• Taiwan Semiconductor Manufacturing (TSM 172.90, +1.70, +1.1%): beats by $0.07, beats on revs; guides Q3 revs in-line
• D.R. Horton (DHI 153.99, -3.52, -2.2%): beats by $0.35, beats on revs; narrows FY24 guidance
• Domino's Pizza (DPZ 418.26, -55.01, -11.6%): beats by $0.35, reports revs in-line
• NVIDIA (NVDA 120.40, +2.41, +2.0%): higher pre-open after yesterday's sharp decline
• Boeing (BA 184.81, -0.03, -0.02%): Seattle workers pass strike vote, according to Reuters 

Reviewing overnight developments:

• Equity indices in the Asia-Pacific region ended Thursday on a mostly higher note while Japan's Nikkei (-2.4%) was a notable laggard, deepening its pullback from a record high. Japan's Nikkei: -2.4%, Hong Kong's Hang Seng: +0.2%, China's Shanghai Composite: +0.5%, India's Sensex: +0.8%, South Korea's Kospi: -0.7%, Australia's ASX All Ordinaries: -0.4%.
  • In economic data:
    • Japan's June trade surplus JPY224.0 bln (expected deficit of JPY240.0 bln; last deficit of JPY1.22 trln). June Imports 3.2% yr/yr (expected 9.3%; last 9.5%) and Exports 5.4% yr/yr (expected 6.4%; last 13.5%)
    • Hong Kong's June Unemployment Rate 3.0% (last 3.0%)
    • Australia's June Employment Change 50,200 (expected 19,900; last 39,500) and full employment change 43,300 (last 41,300). June Unemployment Rate 4.1%, as expected (last 4.0%) and Participation Rate 66.9% (expected 66.8%; last 66.8%). NAB Quarterly Business Confidence -1 (last -2)
  • In news:
    • Comments from former Bank of Japan director Hayakawa garnered attention after he said that he does not expect a rate hike later this month.
    • China's Communist party will host a media briefing tomorrow to summarize the Third Plenum, which concluded today.
• Major European indices trade in positive territory ahead of the European Central Bank's latest policy announcement at 8:15 ET, which is not expected to feature a rate cut. STOXX Europe 600: +0.4%, Germany's DAX: +0.2%, U.K.'s FTSE 100: +0.6%, France's CAC 40: +0.5%, Italy's FTSE MIB: +0.6%, Spain's IBEX 35: +0.7%.
  • In economic data:
    • U.K.'s May Average Earnings Index + Bonus 5.7% yr/yr, as expected (last 5.9%). May three-month employment change 19,000 (expected 18,000; last -140,000), and May Unemployment Rate 4.4%, as expected (last 4.4%). June Claimant Count change 32,300 (expected 23,400; last 51,900)
    • Swiss June trade surplus CHF6.18 bln (expected surplus of CHF5.05 bln; last surplus of CHF5.79 bln)
  • In news:
    • EU Commission President von der Leyen shared a plan to build a "true European defense union" during her new five-year term.