Stock Market Update

The S&P 500 futures currently trade 16 points above fair value. 

Equity indices in the Asia-Pacific region began the week on a mixed note with Japan's Nikkei (+0.9%) and South Korea's Kospi (+3.7%) setting fresh record highs. Japan reported much weaker than expected capital spending for Q1, fueling speculation that Q1 GDP reading will be revised down, though the market continues expecting a rate hike from the Bank of Japan in the near future. China's official PMI readings for May essentially reflected a standstill in activity while Australia's Manufacturing PMI expanded for the second consecutive month and Japan's reading expanded for the fifth month in a row.

• In economic data:
  • China's May Manufacturing PMI 50.0 (expected 50.2; last 50.3) and Non-Manufacturing PMI 50.1 (expected 49.5; last 49.4). RatingDog Manufacturing PMI 51.8 (expected 51.4; last 52.2)
  • Japan's Q1 Capital Spending 0.0% qtr/qtr (expected 4.1%; last 6.5%). May Manufacturing PMI 54.5, as expected (last 55.1)
  • South Korea's May trade surplus $26.95 bln (expected surplus of $24.30 bln; last surplus of $23.76 bln). May Imports 20.8% yr/yr (expected 21.5%; last 16.7%) and Exports 53.2% yr/yr (expected 48.4%; last 48.0%). May Manufacturing PMI 54.8 (last 53.6)
  • Australia's May Manufacturing PMI 50.7 (expected 50.2; last 51.3). May MI Inflation Gauge -0.3% m/m (last 0.6%) and May ANZ Job Advertisements 1.8% m/m (last -0.6%). May Commodity Prices 16.8% yr/yr (last 15.1%)
  • India's May Manufacturing PMI 55.0 (expected 54.3; last 54.7)

---Equity Markets---

• Japan's Nikkei: +0.9%
• Hong Kong's Hang Seng: +0.9%
• China's Shanghai Composite: -0.3%
• India's Sensex: -0.7%
• South Korea's Kospi: +3.7%
• Australia's ASX All Ordinaries: +0.1%

Major European indices trade on a mixed note while Germany's DAX (+0.3%) outperforms with technology stocks contributing to the outperformance. Final May Manufacturing PMI readings from the region showed minimal expansion in Germany's reading (50.1) while the U.K.'s reading (53.9) recorded a four-year high. European Central Bank policymaker Schnabel lamented high energy prices while policymaker Pereira repeated that the central bank should act sooner rather than later, contributing to speculation that a rate hike will be announced this month.

• In economic data:
  • Eurozone's May Manufacturing PMI 51.6 (expected 51.4; last 52.2). April Unemployment Rate 6.3% (expected 6.2%; last 6.3%). April Private Sector Loans 3.0% yr/yr, as expected (last 3.0%), and loans to nonfinancials 3.4% yr/yr (expected 3.1%; last 3.2%)
  • Germany's April Retail Sales -0.3% m/m (expected -0.4%; last -0.3%); -0.3% yr/yr (last 2.7%). May Manufacturing PMI 50.1 (expected 49.9; last 51.4)
  • U.K.'s May Nationwide HPI -0.6% m/m (expected -0.1%; last 0.4%); 1.7% yr/yr (last 3.0%). May Manufacturing PMI 53.9 (expected 53.7; last 53.7)
  • France's May Manufacturing PMI 49.7 (expected 48.9; last 52.8)
  • Italy's May Manufacturing PMI 52.9 (expected 52.0; last 52.1)
  • Spain's May Manufacturing PMI 51.2 (expected 53.7; last 51.7)
  • Swiss Q1 GDP 0.7% qtr/qtr (expected 0.5%; last 0.2%); 0.5% yr/yr (last 1.0%). April Retail Sales 1.6% yr/yr (expected 0.2%; last 1.3%). May Manufacturing PMI 57.3 (expected 54.0; last 54.5)

---Equity Markets---

• STOXX Europe 600: -0.1%
• Germany's DAX: +0.6%
• U.K.'s FTSE 100: -0.2%
• France's CAC 40: +0.4%
• Italy's FTSE MIB: +0.1%
• Spain's IBEX 35: -0.1%