Stock Market Update

The S&P 500 futures are up 21 points and are trading 0.4% above fair value, the Nasdaq 100 futures are up 123 points and are trading 0.7% above fair value, and the Dow Jones Industrial Average futures are down 583 points and are trading 1.5% below fair value.

Contracts linked to the S&P 500 and Nasdaq 100 are higher after yesterday's tech-led retreat while futures tied to the Dow industrials sink after disappointing earnings from UnitedHealth (UNH). Shares are 20% lower ahead of the open after the company missed earnings and revenue estimates, and issued below-consensus guidance.

President Trump said "big progress" was made during his trade talks with a Japanese delegation in a Truth Social post, which has contributed to the early positive bias in equities. 

Market participants receive some potentially market-moving data this morning, including March Housing Starts and Building Permits, along with weekly jobless claims at 8:30 ET.

The 10-yr yield is up two basis points to 4.30% and the 2-yr yield is up one basis point to 3.80%.

In corporate news:

• American Express (AXP 250.00, -2.92, -1.2%): beats by $0.17, reports revs in-line
• Taiwan Semiconductor Manufacturing (TSM 156.52, +4.85, +3.2%): beats by $0.05, reports revs in-line; guides Q2 revs above consensus
• UnitedHealth (UNH 465.01, -120.03, -20.5%): misses by $0.09, misses on revs; lowers and guides FY25 EPS below consensus
• CSX (CSX 27.57, +0.22, +0.8%): misses by $0.03, reports revs in-line
• D.R. Horton (DHI 113.66, -3.88, -3.3%): misses by $0.05, misses on revs; guides FY25 revs below consensus
• Alcoa (AA 24.98, -0.09, -0.4%): beats by $0.47, misses on revs

Reviewing overnight developments:

• Equity indices in the Asia-Pacific region ended Thursday on a higher note. Japan's Nikkei: +1.4%, Hong Kong's Hang Seng: +1.6%, China's Shanghai Composite: +0.1%, India's Sensex: +2.0%, South Korea's Kospi: +0.9%, Australia's ASX All Ordinaries: +0.8%.
  • In economic data:
    • Japan's March trade deficit JPY0.23 trln (expected deficit JPY0.25 trln; last surplus JPY0.19 trln). March Exports 3.9% yr/yr (expected 4.5%; last 11.4%) and March Imports 2.0% yr/yr (expected 3.1%; last -0.7%)
    • Singapore's March trade surplus SGD5.242 bln (last surplus SGD6.182 bln). Non-Oil Exports -7.6% m/m (last 2.6%); 5.4% yr/yr (expected 13.6%; last 7.6%)
    • Australia's March Employment Change +32.2K (expected +39.8K; last -57.5K) and full employment change +15.0K (last -43.9K). March Unemployment Rate 4.1% (expected 4.2%; last 4.0%) and March Participation Rate 66.8% (expected 67.0%; last 66.7%). NAB Quarterly Business Confidence -4 (last -5)
    • New Zealand's Q1 CPI 0.9% qtr/qtr (expected 0.8%; last 0.5%); 2.5% yr/yr (expected 2.3%; last 2.2%)
  • In news:
    • Japan's Trade Representative Akazawa met with U.S. officials, including President Trump, yesterday and he is expected to return for another meeting later this month.
    • Bank of Japan Governor Ueda cautioned that keeping rates at a low level while inflation accelerates could force the Bank of Japan to hike rates rapidly.
    • Japan's exports to China were down almost 5% in March.
    • The Bank of Korea left its policy rate at 2.75%, as expected.
• Major European indices trade in the red. STOXX Europe 600: -0.6%, Germany's DAX: -0.7%, U.K.'s FTSE 100: -0.7%, France's CAC 40: -0.8%, Italy's FTSE MIB: -0.5%, Spain's IBEX 35: -0.3%.
  • In economic data:
    • Germany's March PPI -0.7% m/m (expected -0.1%; last -0.1%); -0.2% yr/yr (expected 0.4%; last 0.5%).
    • Swiss March trade surplus CHF6.350 bln (expected surplus CHF5.220 bln; last surplus CHF4.741 bln)
  • In news:
    • The European Central Bank is expected to cut rates by 25 basis points at 8:15 ET and ECB President Lagarde is expected to say that trade uncertainty clouds the forward outlook at her press conference.
    • The Bank of England's latest Credit Conditions survey showed that credit availability to households increased in Q1 and is expected to increase again in Q2.
    • Italy's Prime Minister Meloni will meet with President Trump today to discuss trade, much to the chagrin of other EU officials who prefer a unified approach.