Morning Minutes

Economic News, Earnings and Biden Speech In The Spotlight




The last trading day for March, the first quarter and the fiscal year end for many companies in the investment industry finds markets around the world flat as investors digest a number of current and upcoming announcements ahead of the Easter long weekend.

Dow futures are flat while NASDAQ futures are up 0.6%, after posting 0.3% losses yesterday. The US 10-year treasury note yield is holding steady between 1.70% and 1.75%. Major European indices are also flat while in Asia Pacific trading, the Nikkei lost 0.8% and the Hang Seng fell 0.7%. In commodity trading WTI crude oil is up 0.2% and copper is up 0.7%.

There are a number of economic announcements this morning, headlined by US ADP payroll growth for March which accelerated to 517K but fell short of the 550K the street was expecting. An upward revision of February payrolls to 176K from 117K accounts for the shortfall. In Canada, monthly GDP for January increased 0.7%, beating the 0.5% street estimate and accelerating from 0.1% monthly growth in December, adding support to the Bank of Canada’s recent hints about starting to taper its asset purchase program in the coming months.   

At 4:20 pm today, US President Biden is scheduled to outline his plan for physical infrastructure spending. In addition to the overall investment, expected to be around $2 Trillion, and the potential impact for particular sectors (particularly materials, construction/engineering, manufacturing, alternative energy, and others), Biden’s plans for how to pay for this in terms of potential tax increases (corporate, personal, or capital gains) may potentially impact market sentiment heading into April.

Monthly PMI reports are also starting to roll out. Last night, China beat the street on both their Manufacturing (51.9 vs street 51.2) and Non-Manufacturing (56.3 vs street 52.6) surveys. US Chicago PMI is due at 9:45 am EDT (60.7 vs street 59.5). Tomorrow brings Manufacturing PMI reports from around the world plus monthly US construction spending and the quarterly Tankan corporate surveys from Japan.

Several companies have reported results overnight and this morning. Highlights include: lululemon ($2.58 vs street $2.49, online sales up 92% over year, total sales up 24% over year), Blackberry (sales $210M vs street $245M a year ago $282M, down 5.2% premarket), Chewy (EPS +$0.05 vs street -$0.20, sales $2.04B vs street $1.96B, up 16.3% premarket), and Walgreens Boots ($1.40 vs street $1.11, up 2.4% premarket).

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Colin Cieszynski, Chief Market Strategist

Colin Cieszynski, CFA, CMT
Chief Market Strategist
+1 (647) 282-4428

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