Stock Market Update

The S&P 500 futures are up three points and are trading 0.1% above fair value, the Nasdaq 100 futures are up 11 points and are trading 0.1% above fair value, and the Dow Jones Industrial Average futures are down five points and are trading fractionally below fair value.

Stock futures are flattish in front of a busy week. Earnings reporting picks up steam, especially in the retail and tech spaces, and Fed Chair Powell will speak in Jackson Hole. The market will receive the Minutes from the July 30-31 FOMC meeting on Wednesday. 

The 10-yr note yield is down two basis points to 3.87% and the 2-yr note yield is down one basis point to 4.05%.

Today's economic data is limited to the July Leading Indicators Index at 10:00 ET.

In corporate news:

• Advanced Micro (AMD 151.47, +2.91, +2.0%): announced the signing of a definitive agreement to acquire ZT Systems in a cash and stock transaction valued at $4.9 bln
• Estee Lauder (EL 92.00, -2.97, -3.1%): beats by $0.38, beats on revs; guides Q1 EPS below consensus, revs below consensus; guides FY25 EPS below consensus, revs below consensus
• TSMC (TSM 174.53, -0.01, -0.01%): price target raised to $220 from $200 at Bernstein
• Apple (AAPL 225.97, -0.08, -0.04%): decision to drop Qualcomm (QCOM) modems will not have an immediate benefit, according to Bloomberg
• HP (HP 33.98, -0.11, -0.3%): downgraded to Equal Weight from Overweight at Morgan Stanley

Reviewing overnight developments: 

• Equity indices in the Asia-Pacific region were mixed in Monday's trading. Japan's Nikkei: -2.0%, Hong Kong's Hang Seng: +0.8%, China's Shanghai Composite: +0.5%, India's Sensex: flat, South Korea's Kospi: -0.9%, Australia's All Ordinaries: +0.1%.
  • In economic data:
    • Japan's June Core Machinery Orders 2.1% m/m (expected 0.9%; last -3.2%) and -1.7% yr/yr (expected 1.8%; last 10.8%)
  • In news:
    • Japan's Nikkei (-2.0%) was a focal point on the downside with a rapidly strengthening yen serving as the primary catalyst for the selling pressure. The USD/JPY pair moved from just north of 149.00 on Friday to 145.39 in overnight trading before easing some.
    • The yen's move came amid a CFTC report indicating hedge funds have a net long position for the first time in three years and a noteworthy offer by Alimentation Couche-Tard to acquire Seven & I.
    • Separately, reports indicate there are 10 candidates vying to be LDP leader. That leadership race will be held September 27.
    • In China, Premier Li talked up the need to do more to spur domestic demand; meanwhile, Thailand's new prime minister said she is pausing a $13 billion cash stimulus plan for Thai citizens.
• Major European indices have taken a mostly higher turn Monday amid a relative lack of news catalysts. STOXX Europe 600: +0.3%, Germany's DAX: +0.1%, U.K.'s FTSE 100: flat, France's CAC 40: +0.3%, Italy's FTSE MIB: +0.6%, Spain's IBEX 35: +1.0%.
  • In economic data:
    • U.K.'s August Rightmove House Price Index -1.5% m/m (last -0.4%) and 0.8% yr/yr (last 0.4%)
    • Spain's June Trade Balance -EUR0.71 bln (last -EUR2.30 bln)
  • In news:
    • The upside bias is being attributed mostly to continued rebound momentum following last week's rebound effort that was helped by a turn in sentiment on U.S. growth prospects.
    • The euro continues to strengthen against the dollar (EUR/USD +0.1% to 1.1035), hitting its highest level in more than seven months.
    • Press reports indicate Germany's 2025 draft budget plan incorporates a drastic reduction in aid for Ukraine moving forward.