【Fujitomi】Nikkei futures lead buy, risk-on mood prevailing
The U.S. stock market continued higher. The Nasdaq Composite finished at a first-time close above 6,000. The S&P 500 index rose 14.46 points (0.6%) to 2388.61, and the Dow Jones الصناة ended up 232.23 points (1.11%) higher at 20,996.12. The Nasdaq Composite closed up 41.673 points (0.69%) at 6,025.49. Strong corporate earnings, expectations for a tax-cut plan to be announced tomorrow, and favorable economic data provided a rising backdrop. Caterpillar rose 7.9% and McDonald’s rose 5.6%, underpinning the index’s advance. Caterpillar’s earnings per share (EPS) were $1.28, versus consensus of $0.63, significantly beating expectations. The company also raised its full-year EPS forecast for 2017 from $2.90 to $3.75.
NYMEX WTI crude oil futures for June settled 33 cents (0.67%) higher at $49.56 per barrel. Ahead of the EIA’s weekly statistics on the 26th, there was a pre-emptive expectation of U.S. crude oil and product stock draws.
Will the Nikkei average continue to rise today? With the French presidential election passing smoothly and a risk-on mood in the air, buying is likely to be in the lead, buoyed by favorable corporate earnings and policy progress. On the other hand, vigilance regarding North Korea remains necessary...
https://www.fujitomi.co.jp/?p=14742
【Reasons to Buy】
・Expectations for U.S. tax reform
・U.S. stocks rise on strong corporate earnings, Nasdaq hits 6,000
・Dow Jones up (20,996.12, +232.23)
・Nasdaq breaks through 6,000
・Dollar strengthens to the ¥111 level, euro at a 5-and-a-half-month high = NY currency market
・March U.S. new home sales at a multi-month high
・U.S. Case-Shiller home price index shows the largest February gain since 14 years ago
・New York crude oil futures – slight rebound but weighed by fear of oversupply (49.56, +0.33)
・European stock markets – continued gains, with profit-taking after recent large gains
・Germany raises its 2017–2018 growth forecast = government official
・North Korea shows no major provocation on the military anniversary
・CME 225 futures rise vs Osaka Exchange (19,200, +110)
・VIX fear index at 10.76, down from the previous day
・Expectations for supply-demand support from Bank of Japan ETF purchases
【Reasons to Sell】
・North Korea geopolitical risk
・Trump administration policy management uncertainty
・Greece debt crisis resurgence
・Continued U.S. dollar strength normalization
・U.S. April consumer confidence index 120.3, below expectations
・Budget deadline of April 28 could risk a government shutdown
【Other Highlights】
・BOJ Monetary Policy Meeting (Day 1)
・U.S. Treasury market – yields rise on expectations of tax reform
・European bonds – continue to fall, German yields at highest since end of March
・NY gold futures – down again, at a multi-week low
・U.S. February housing price index (MoM) +0.8% (previous +0.0%)
・U.S. February S&P/Case-Shiller home price index (YoY) +5.85% (prev +5.73%)
・U.S. April Consumer Confidence Index 120.3 (consensus 122.5) (previous 125.6)
・U.S. March new home sales 621,000 (expected 583,000) (previous 592,000)
・U.S. April Richmond Fed manufacturing index +20 (previous +22)
・Canada-U.S. trade tensions, necessity of NAFTA renegotiation indicated = U.S. Commerce Secretary
・U.S. CB Consumer Confidence declines, perhaps due to difficulties in repealing Obamacare
・Prime Minister Abe visits Britain, to meet with Prime Minister May on the 28th
・U.S.-Japan Aegis ships conduct joint exercises in the Sea of Japan
・ECB considers unwinding accommodation in June as political risk recedes = sources
・China maintains a cautious monetary policy = Xinhua
《Schedule》
13:30 February All Industry Activity Index
10:30 Australia Q1 2017-18 CPI
15:45 France April Consumer Confidence
18:30 South Africa March Wholesale Trade
20:00 Turkey Central Bank policy rate
20:00 MBA Mortgage Applications
21:30 February Canada Retail Trade
23:30 EIA Weekly Petroleum Status
27th 02:00 U.S. Treasury, 5-year note auction (34 billion)
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