After starting the week and month off strong with gains of 2.0% to 3.0%, US index futures are flat this morning while investors digest yesterday’s news and market action. Overseas bourses are mixed with the Dax up 0.5% and the FTSE up 0.6%, but the Nikkei down 0.9% and the Hang Seng down 1.2%.
Commodities continue to climb this morning, attracting ongoing support from yesterday’s positive manufacturing and construction numbers. WTI crude oil is up 0.5%, natural gas is up 1.0%, and copper is up 1.1%. Currencies, including precious metals and bitcoin, along with the US 10-year treasury yield, are steady this morning.
US construction spending was particularly strong (1.7% vs street 0.8%), along with the new orders component of the US ISM manufacturing PMI report (64.8 vs previous 64.1). The ISM report also indicated rising prices paid (86.0 vs street 80.0) which could stoke concerns that rising inflation may eventually force interest rates upward.
There were a few earnings reports of interest out overnight. Zoom beat the street by a country mile on EPS ($1.22 vs street $0.79 and is up 6.2% premarket on top of yesterday’s 9.6% gain. Target also beat expectations on both EPS ($2.67 vs street $2.54) and same store sales (20.5% vs street 16.8%).
Canada’s Q4 GDP came in stronger than expected (9.6% vs street 7.5%). Tomorrow morning brings the US ADP private sector payrolls report (street 177K vs previous 174K).