Stock Market Update

The S&P 500 futures are down 21 points and are trading 0.3% below fair value, the Nasdaq 100 futures are down 97 points and are trading 0.5% below fair value, and the Dow Jones Industrial Average futures are down 132 points and are trading 0.3% below fair value.

Seeing an unwind of yesterday's post-FOMC rally move, which some claimed was overdone relative to the mixed message of Fed Chair Powell offering some reassurances about economic activity while the SEP showed a downgrade to the 2025 real GDP growth forecast and an upgrade to the 2025 PCE and core-PCE inflation forecasts -- divergences that play into stagflation worries.

Mega-cap stocks, which led yesterday's advance, are back to their seesaw action, trading on the weaker side of things this morning, which is weighing on a market digesting a lot of central bank news.

The People's bank of China left its 1-yr and 5-yr loan prime rates unchanged, the Swiss National Bank cut its policy rate by 25 bps to 0.25%, Sweden's Riksbank left it policy rate unchanged at 2.25%, Brazil raised its policy rate by 100 bps to 14.25%, and ECB President Lagarde suggested the 25% tariff on imports imposed by the U.S. could subtract approximately 0.3 percentage points from euro area growth in the first year.

Separately, the Bank of England is due out with a policy decision at 8:00 a.m. ET. It is expected to leave its policy rate unchanged at 4.50%.

Today's economic data includes weekly initial jobless claims at 8:30 a.m. ET, the March Philadelphia Fed Index at 8:30 a.m. ET, the Q4 Current Account Balance at 8:30 a.m. ET, February Existing Home Sales at 10:00 a.m. ET; and February Leading Indicators at 10:00 a.m. ET.

The 2-yr note yield is down four basis points to 3.94% and the 10-yr note yield is down six basis points to 4.20%.

In corporate news:

• Accenture (ACN 320.79, -3.68, -1.1%): beats by $0.01, reports revs in-line; guides FY25 EPS in-line
• Chevron (CVX 163.81, -0.24, -0.2%): The Trump administration mulling extension of Chevron Venezuela license, according to The Wall Street Journal
• Darden Restaurants (DRI 185.00, -3.15, -1.7%): reports EPS in-line, misses on revs, consolidated comps of +0.7%; guides FY25 EPS in-line, revs in-line
• FactSet (FDS 435.67, -2.73, -0.6%): beats by $0.11, reports revs in-line; reaffirms FY25 EPS guidance, guides FY25 revs in-line
• Five Below (FIVE 83.12, +7.53, +10.0%): beats by $0.10, reports revs in-line; guides Q1 EPS above consensus, revs above consensus; guides FY26 EPS below consensus, revs in-line
• NVIDIA (NVDA 116.67, -0.85, -0.7%): planning to spend hundreds of billions of dollars on US supply chains amid tariffs, according to FT
• PDD Holdings (PDD 117.77, -8.15, -6.5%): beats by RMB0.30, misses on revs

Reviewing overnight developments:

• Equity indices in the Asia-Pacific region were mixed on Thursday while Japan's Nikkei was closed for Vernal Equinox. Hong Kong's Hang Seng: -2.2%, China's Shanghai Composite: -0.5%, India's Sensex: +1.2%, South Korea's Kospi: +0.3%, Australia's ASX All Ordinaries: +1.2%.
  • In economic data:
    • Hong Kong's February CPI -0.1% m/m (last 0.4%); 1.4% yr/yr (expected 1.8%; last 2.0%)
    • Australia's February Employment Change -52,800 (expected 30,800; last 30,500) and full Employment Change -35,700 (last 36,900). February Unemployment Rate 4.1%, as expected (last 4.1%), and Participation Rate 66.8% (expected 67.3%; last 67.2%)
    • New Zealand's Q4 GDP 0.7% qtr/qtr (expected 0.4%; last -1.1%); -1.1% yr/yr (expected -1.4%; last -1.6%). Q4 GDP Expenditure 0.8% qtr/qtr (last -0.9%). Q1 Westpac Consumer Sentiment 89.2 (last 97.5)
  • In news:
    • China's weakness attributed to ongoing concerns about economic slowdown and potential shifts in U.S. policy under the Trump administration.
    • The People's Bank of China made no changes to its one-year and five-year loan prime rates.
    • New Zealand reported above-consensus growth for Q4, emerging from a technical recession.
• Major European indices trade in the red with banks showing relative weakness. STOXX Europe 600: -0.6%, Germany's DAX: -1.6%, U.K.'s FTSE 100: -0.1%, France's CAC 40: -1.1%, Italy's FTSE MIB: -1.7%, Spain's IBEX 35: -1.0%.
  • in economic data:
    • Eurozone's January Construction Output 0.2% m/m (last 0.4%)
    • Germany's February PPI -0.2% m/m (expected 0.2%; last -0.1%); 0.7% yr/yr (expected 1.0%; last 0.5%)
    • U.K.'s January Average Earnings Index + Bonus 5.8% yr/yr, as expected (last 6.1%). January three-month employment change 144,000 (expected 95,000; last 107,000) and January Unemployment Rate 4.4%, as expected (last 4.4%). February Claimant Count Change 44,200 (expected 7,900; last 2,800)
    • Swiss February trade surplus CHF4.803 bln (expected surplus of CHF5.010 bln; last surplus of CHF6.148 bln)
  • In news:
    • European Central Bank President Lagarde warned that a U.S.-EU trade war could cut eurozone growth by 0.3 percentage points.
    • France announced plans to spend EUR5 billion on defense spending, reflecting rising military budgets across Europe.
    • BlackRock is expanding its retail-focused products to capture more European savers, while Commerzbank reaffirmed its independent strategy despite UniCredit receiving ECB approval to acquire a stake.