US equities are under pressure this morning as investors hold back after the CPI report and await remarks from Fed Chair Yellen later this afternoon. Trading volumes are markedly lower ahead of the Memorial Day weekend holiday. As of writing, the DJIA is down 0.32%, the S&P500 is down 0.10% and the Nasdaq is flat.
The April CPI report was stronger than expected. US April CPI rose m/m for the third straight month, while core CPI saw its biggest m/m gain since January 2013. Analysts also highlighted that for the third straight month, core goods prices increased in April despite the stronger greenback, which should ease concerns that the stronger USD could trim core inflation.
The euro took another big leg lower this morning on reports that German Finance Minister Schaeuble discussed the possibility of a parallel currency for Greece in a private discussion, although the report also highlighted that he did not endorse such a move. EUR/USD had made a run back above 1.1200 during the European session, but after the report made the rounds the pair dropped about two big figures to test 1.1000.
Hewlett-Packard is up nearly 4% despite a solidly in-line report and lower y/y revenue. On the conference call, executives said they had nearly completed the big restructuring effort begun back in 2012. Deere had a mixed quarter, with earnings very good despite revenue softness and a lower outlook for equipment sales. Shares of DE are up 3.7%. Retail names are broadly lower as apparel names saw tepid or negative comps and weak earnings.
***Looking Ahead***
- 13:00 (US) Baker Hughes weekly Rig Count data
- 13:00 (US) Fed Chair Yellen
- (CO) Colombia Apr Retail Confidence: No est v 20.3 prior; Industrial Confidence: No est v 4.1 prior
- (PE) Peru Central Bank 2Q Inflation Report
- (CO) Colombia Central Bank Interest Rate Decision: Expected to leave Overnight Lending unchanged at 4.50%
***Economic Data***
- (US) Apr CPI M/M: 0.1% v 0.1%e; Y/Y: -0.2% v -0.2%e
- (US) Apr CPI Ex Food and Energy M/M: 0.3% v 0.2%e; Y/Y: 1.8% v 1.7%e
- (US) Apr CPI NSA: 236.599 v 236.58e; CPI Core Index SA: 241.409 v 241.13e
- (US) Apr Real Avg Weekly Earnings Y/Y: 2.3% v 2.2% prior
- (CA) Canada Apr CPI M/M: -0.1% v 0.1%e; Y/Y: 0.8% v 1.0%e; Consumer Price Index: 126.2 v 126.5e
- (CA) Canada Apr CPI Core M/M: 0.1% v 0.2%e; Y/Y: 2.3% v 2.4%e
- (CA) Canada Apr CPI (Seasonally Adj) M/M: -0.1% v 0.0%e; CPI Core (Seasonally Adj) M/M: 0.0% v 0.1%e
- (CA) Canada Mar Retail Sales M/M: 0.7% v 0.3%e; Retail Sales Ex Auto M/M: 0.5% v 0.4%e
- (RU) Russia Apr Unemployment Rate: 5.8% v 6.0%e
- (RU) Russia Apr Real Retail Sales M/M: -2.6% v -0.7%e; Y/Y: -9.8% v -8.1%e
- (BE) Belgium May Consumer Confidence Index: -3 v -6 prior
[I]Contributed by Trade The News[/I]
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