Stock Market Update

The S&P 500 futures are up 57 points and are trading 1.1% above fair value, the Nasdaq 100 futures are up 228 points and are trading 1.3% above fair value, and the Dow Jones Industrial Average futures are up 310 points and are trading 0.7% above fair value.

Stocks are poised for higher open in a continuation of yesterday's buy-the-dip efforts after Monday's sharp slide. 

The yen weakened noticeably against the dollar overnight (USD/JPY +2.1% to 147.29), supporting the ongoing positive bias in US equities. This followed remarks by Bank of Japan Deputy Governor Uchida indicating that the BoJ will not raise rates during market instability.

Some notable names that reported earnings since yesterday's close have garnered negative responses, but that hasn't changed sentiment much. Dow component Walt Disney (DIS) is slightly lower after reporting results, along with CVS Health (CVS). 

Treasury yields are higher this morning. The 10-yr yield is up four basis points to 3.93% and the 2-yr yield is up two basis points to 4.00%. 

Today's economic lineup featured the weekly MBA Mortgage Applications Index, which jump 6.9% after last week's 3.9% decline. 

In corporate news:

• Walt Disney (DIS 89.90, -0.07, -0.1%): beats by $0.19, reports revs in-line, Disney+ Core subscribers increased 1% to 118.3 mln; raises FY24 EPS growth guidance to 30% from 25%
• CVS Health (CVS 58.20, -0.14, -0.2%): beats by $0.10, reports revs in-line; lowers FY24 EPS below consensus
• Lyft (LYFT 9.44, -1.53, -14.0%): beats by $0.08, beats on revs
• Super Micro Computer (SMCI 527.50, -89.44, -14.5%): misses by $1.87, reports revs in-line; guides Q1 EPS in-line, revs above consensus; guides FY25 revs above consensus; announces 10-for-1 stock split
• Rivian Automotive (RIVN 13.48, -1.32, -8.9%): misses by $0.22, reports revs in-line
• Airbnb (ABNB 111.26, -19.21, -14.7%): misses by $0.05, reports revs in-line; guides Q3 revs in-line; expects sequential moderation in bookings growth in Q3; slowing demand from U.S. guests; Softness in terms of longer lead times weighing on near-term guidance
• Amgen (AMGN 322.44, -6.51, -2.0%): misses by $0.01, reports revs in-line; guides FY24 EPS in-line, revs in-line
• Fortinet (FTNT 64.97, +9.16, +16.4%): beats by $0.16, beats on revs; guides Q3 EPS above consensus, revs in-line; guides FY24 EPS above consensus, revs above consensus

Reviewing today's economic data:

• Equity indices in the Asia-Pacific region ended the midweek session on a higher note. Japan's Nikkei: +1.2%, Hong Kong's Hang Seng: +1.4%, China's Shanghai Composite: +0.1%, India's Sensex: +1.1%, South Korea's Kospi: +1.8%, Australia's ASX All Ordinaries: +0.3%.
  • In economic data:
    • China's July trade surplus $84.65 bln (expected $97.50 bln; last $99.05 bln). July Imports 7.2% yr/yr (expected 3.5%; last -2.3%) and Exports 7.0% (expected 9.7%; last 8.6%)Japan's June Leading Index 108.6 (expected 109.0; last 111.2) and Coincident Indicator -3.4% m/m (last 1.9%)
    • Australia's July AIG Manufacturing Index -19.5 (last -26.5) and AIG Construction Index -20.7 (last -23.2)
    • New Zealand's Q2 Employment Change 0.4% qtr/qtr (expected -0.2%; last -0.2%). Q2 Labor Cost Index 0.9% qtr/qtr (expected 0.8%; last 0.8%). Q2 Unemployment Rate 4.6% (expected 4.7%; last 4.4%) and Participation Rate 71.7% (expected 71.3%; last 71.6%)
  • In news:
    • Japan's Nikkei (+1.2%) extended its bounce while the yen retreated against the dollar with help from comments from Bank of Japan Deputy Governor Uchida, who said that the BoJ will not raise rates during market instability.
    • China's trade surplus in July was shy of expectations as imports grew more than expected while export growth missed estimates.
    • New Zealand reported stronger-than-expected employment for Q2.
• Major European indices trade on a firmly higher note. STOXX Europe 600: +1.5%, Germany's DAX: +1.4%, U.K.'s FTSE 100: +1.2%, France's CAC 40: +1.7%, Italy's FTSE MIB: +2.1%, Spain's IBEX 35: +1.7%.
  • In economic data:
    • Germany's June Industrial Production 1.4% m/m (expected 1.0%; last -3.1%). June trade surplus EUR20.4 bln (expected surplus of EUR21.7 bln; last surplus of EUR25.3 bln). June Imports 0.3% m/m (expected 2.8%; last -5.5%) and Exports -3.4% m/m (expected -1.5%; last -3.1%)
    • U.K.'s July Halifax House Price Index 0.8% m/m (expected 0.2%; last 0.0%); 2.3% yr/yr (last 1.9%)
    • France's June trade deficit EUR6.1 bln (expected deficit of EUR7.5 bln; last deficit of EUR7.7 bln). June Current Account deficit EUR2.6 bln (last deficit of EUR2.5 bln)
  • In news:
    • Shipping giant Maersk said that it is not expecting a recession in the U.S. at this time.
    • Tiremaker Continental missed Q2 expectations and lowered its outlook for the year.
    • Commerzbank reported in-line results and announced a buyback.