Stock Market Update

The S&P 500 futures trade 80 points below fair value.

Equity indices in the Asia-Pacific region ended the week on a mostly higher note. Nikkei reported that Japanese corporate profits are on course to see their first annual decline in six years. Japanese debt climbed with longer tenors leading the way, but not before yields touched fresh highs for the week, which saw the 40-yr yield reach a record high. South Korea's finance ministry said that it will closely monitor bond markets in U.S. and Japan. Japan's top trade negotiator is scheduled to return to Washington for talks at the end of next week.

• In economic data:
  • Japan's April National CPI 0.4% m/m (last 0.3%); 3.6% yr/yr (last 3.6%). April National Core CPI 3.5% yr/yr (expected 3.4%; last 3.2%) o South Korea's April PPI -0.1% m/m (last 0.0%); 0.9% yr/yr (last 1.3%)
  • Singapore's April CPI -0.3% m/m (last -0.1%); 0.9% yr/yr (expected 0.8%; last 0.9%). April Core CPI 0.7% yr/yr (expected 0.5%; last 0.5%)
  • New Zealand's Q1 Retail Sales 0.8% qtr/qtr (expected 0.0%; last 0.9%) and Core Retail Sales 0.4% qtr/qtr (expected 0.7%; last 1.4%)

---Equity Markets---

• Japan's Nikkei: +0.5% (-1.6% for the week)
• Hong Kong's Hang Seng: +0.2% (+1.1% for the week)
• China's Shanghai Composite: -0.9% (-0.6% for the week)
• India's Sensex: +1.0% (-0.7% for the week)
• South Korea's Kospi: -0.1% (-1.3% for the week)
• Australia's ASX All Ordinaries: +0.2% (+0.1% for the week)

Major European indices are on track for a lower finish to the week after President Trump threatened a 50% tariff on European imports due to slow negotiations. The U.K. reported above-consensus retail sales growth for April and Bank of England Governor Bailey said that more signs of receding inflation are needed in order to cut rates. Meanwhile, European Central Bank policymakers Rehn and Stournaras spoke in favor of a rate cut in June.

• In economic data:
  • Germany's Q1 GDP 0.4% qtr/qtr (expected 0.2%; last -0.2%); 0.0% yr/yr (expected -0.2%; last -0.2%)
  • U.K.'s April Retail Sales 1.2% m/m (expected 0.3%; last 0.1%); 5.0% yr/yr (expected 4.5%; last 1.9%). April Core Retail Sales 1.3% m/m (expected 0.3%; last 0.2%); 5.3% yr/yr (expected 4.4%; last 2.6%)
  • France's May Consumer Confidence 88 (expected 93; last 91)

---Equity Markets---

• STOXX Europe 600: -1.7% (-1.5% week-to-date)
• Germany's DAX: -2.4% (-1.3% week-to-date)
• U.K.'s FTSE 100: -1.0% (-0.4% week-to-date)
• France's CAC 40: -2.6% (-2.9% week-to-date)
• Italy's FTSE MIB: -2.5% (-3.5% week-to-date)
• Spain's IBEX 35: -2.2% (-0.8% week-to-date)