Stock Market Update

The S&P 500 futures currently trade 21 points above fair value.

Equity indices in the Asia-Pacific region ended the week on a mixed note though markets in China, Hong Kong, South Korea, India, and Singapore were closed for holidays, resulting in lower overall volume. Japanese shipper Mitsui expects that traffic through the Strait of Hormuz will normalize in the next couple months. Japan's Tokyo Core CPI decelerated in April despite the sharp rise in energy prices while April Manufacturing PMI (55.1) expanded at its fastest pace in more than a decade. Taiwan's Q1 GDP grew 13.7%, a pace not seen since 1987. A bipartisan delegation will visit China this weekend ahead of President Trump's planned trip to Beijing later this month.

• In economic data:
  • Japan's April Tokyo CPI 1.5% yr/yr (last 1.4%) and Tokyo Core CPI 1.5% yr/yr (expected 1.8%; last 1.7%). April Manufacturing PMI 55.1 (expected 54.9; last 51.6)
  • South Korea's April trade surplus $23.77 bln (expected surplus of $23.00 bln; last surplus of $26.24 bln). April Imports 16.7% yr/yr (expected 14.5%; last 13.2%) and Exports 48.0% yr/yr (expected 45.3%; last 49.2%)
  • Australia's April Manufacturing PMI 51.3 (expected 51.0; last 49.8). Q1 PPI 0.4% qtr/qtr (expected 0.9%; last 0.8%); 3.0% yr/yr (last 3.5%). April Commodity Prices 15.7% yr/yr (last 12.7%)
  • New Zealand's March Building Consents -1.3% m/m (last 2.8%)

---Equity Markets---

• Japan's Nikkei: +0.4%
• Hong Kong's Hang Seng: CLOSED
• China's Shanghai Composite: CLOSED 
• India's Sensex: CLOSED 
• South Korea's Kospi: CLOSED
• Australia's ASX All Ordinaries: +0.8% 

Most major European markets are closed for Labor Day while the U.K.'s FTSE (-0.5%) trades in negative territory amid weakness in consumer, industrial, and mining names. Expectations for up to two rate hikes from the European Central Bank are solidifying while the Bank of England is seen as likely to announce a rate hike by July, followed by another one in September.

• In economic data:
  • U.K.'s April Nationwide HPI 0.4% m/m (expected -0.3%; last 0.9%); 3.0% yr/yr (expected 2.2%; last 2.2%). April Manufacturing PMI 53.7 (expected 53.6; last 51.0). March Mortgage Lending GBP6.15 bln (expected GBP4.20 bln; last GBP5.22 bln) and March Net Lending to Individuals GBP8.000 bln (expected GBP5.900 bln; last GBP6.800 bln)
  • Swiss March Retail Sales 0.5% yr/yr (expected 0.6%; last 0.4%)

---Equity Markets---

• STOXX Europe 600: -0.1% 
• Germany's DAX: CLOSED 
• U.K.'s FTSE 100: -0.7% 
• France's CAC 40: CLOSED
• Italy's FTSE MIB: CLOSED
• Spain's IBEX 35: CLOSED