Stock Market Update

The S&P 500 futures trade 39 points below fair value.

Equity indices in the Asia-Pacific region ended Wednesday on a mostly higher note while Japan's Nikkei (-0.6%) underperformed as longer-dated JGBs extended yesterday's sharp losses before bouncing. Japan's government is reportedly willing to accept a tariff reduction rather than an exception. Chinese press speculated that the People's Bank of China will continue lowering its loan prime rate. South Korea's exports through the first 20 days of May were down 2.4% yr/yr.

• In economic data:
  • Japan's April trade deficit JPY115.8 bln (expected surplus of JPY227.1 bln; last surplus of JPY559.4 bln). April Imports -2.2% yr/yr (expected -4.5%; last 1.8%) and Exports 2.0% yr/yr, as expected (last 4.0%)
  • Australia's April MI Leading Index 0.0% m/m (last -0.2%)
  • New Zealand's April trade surplus NZD1.426 bln (expected surplus of NZD670 mln; last surplus of NZD794 mln). April Credit Card Spending 0.5% yr/yr (last 0.7%)

---Equity Markets---

• Japan's Nikkei: -0.6%
• Hong Kong's Hang Seng: +0.6%
• China's Shanghai Composite: +0.2%
• India's Sensex: +0.5%
• South Korea's Kospi: +0.9%
• Australia's ASX All Ordinaries: +0.5%

Major European indices trade near their flat lines. The April CPI report from the U.K. served as a reminder of stubborn inflation, weighing on expectations for a rate cut from the Bank of England next month. Similarly, European Central Bank Vice President de Guindos said that the ECB is not rushing to cut rates due to worries about persistent wage growth. The U.K.'s deputy prime minister called for higher taxes in a memo sent to Chancellor Reeves.

• In economic data:
  • U.K.'s April CPI 1.2% m/m (expected 1.1%; last 0.3%); 3.5% yr/yr (expected 3.3%; last 2.6%). April Core CPI 1.4% m/m (expected 1.2%; last 0.5%); 3.8% yr/yr (expected 3.6%; last 3.4%). April House Price Index 6.4% yr/yr (expected 5.2%; last 5.4%)

---Equity Markets---

• STOXX Europe 600: -0.3%
• Germany's DAX: -0.2%
• U.K.'s FTSE 100: UNCH
• France's CAC 40: -0.5%
• Italy's FTSE MIB: -0.1%
• Spain's IBEX 35: +0.1%