US index futures are trading up 0.3% (Dow) to up 1.1% (NASDAQ) shrugging off yesterday’s stagflation sparked selloff that saw US indices drop 0.4%-1.0% with investors responding positively to another round of generally positive earnings reports released overnight. Overseas, the Dax is up 0.8%, the FTSE is up 0.5% and the Hang Seng rallied 2.1%.
Tech giants Microsoft* ($2.94 vs street $2.82, up 3.8% premarket) and Alphabet ($1.89 vs street $1.51, up 11.3% premarket) soared in aftermarket trading after beating the street. Results from energy giants have been mixed with Chevron beating expectations by a penny, while Exxon Mobil disappointed ($2.06 vs street $2.19, down 1.7% premarket). Refiner Phillips 66 also disappointed today ($1.90 vs street $2.20, down 3.9% premarket). In Canada, Agnico-Eagle crushed expectations ($1.04 vs street $0.83, up 2.7% premarket), while TFI International* ($1.68 vs street $1.84) disappointed. Imperial Oil* is also scheduled to release results this morning as well.
The Yen has been under pressure overnight after the Bank of Japan followed its previous historic interest rate increase out of negative territory to zero with an underwhelming pause. Alternative currency action, meanwhile, suggests investors are continuing to become more cautious with Gold up 0.7% and Bitcoin down 0.7%. Commodities are climbing again, adding to inflation pressures with US crude Oil up 0.9% and Copper up 1.3%.
Speaking of inflation, US monthly Core PCE inflation, the Fed’s preferred measure, did not decline as hoped and was hotter than expected (2.8% unchanged vs street 2.6%) confirming yesterday’s jump in Q1 US GDP inflation. The US 10-year treasury note yield is holding above 4.65% on the news. *Shares of Microsoft, TFI International, and Imperial Oil are held in portfolios managed by SIA Wealth Management