Stocks Erase Gain, U.S. Futures Dip as Yields Rise

13/04/2021 Asian equities erase gains and U.S. stock futures slip as traders await inflation data, a Treasury auction and corporate earnings to assess the market outlook. Bond yields and the dollar climbed. Shares retreated in China, where export growth missed forecasts in March and concern about the financial health of one of the nation’s largest bad-debt managers soured the mood. U.S. equity futures dipped following a slight pullback in the S&P 500 Index from a record. European contracts were steady.

Week ahead :

• Banks and financial firms begin reporting first-quarter earnings, including JPMorgan Chase & Co., Citigroup Inc., Bank of America Corp., Morgan Stanley, Goldman Sachs Group Inc.
• The U.S. releases inflation data later today.
• Economic Club of Washington hosts Fed Chair Jerome Powell for a moderated Q&A on Wednesday.
• U.S. Federal Reserve releases Beige Book on Wednesday.
• U.S. data including initial jobless claims, industrial production and retail sales come Thursday.
• China economic growth, industrial production and retail sales figures are on Friday.

Locally the market closed at its worst level in a week with the miners being the biggest losers, the Resi was down 2.09%, Naspers and Prosus didn’t help been down 2.08 and 2.17 percent respectively. Volumes were very low with only R 16.2 bln going through the market of which about 30% uncrossed in the auction.

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ECONOMIC DATA:

• 11:30am: Feb. Mining Production MoM, est. 0.3%, prior 4.5%
• 11:30am: Feb. Platinum Production YoY, prior -14.5%
• 11:30am: Feb. Gold Production YoY, prior -14.1%

European markets are set for a flat open on Tuesday as investors await key economic data and the beginning of corporate earnings season. Britain’s FTSE 100 is seen around 4 points lower at 6,885, Germany’s DAX is set to climb around 21 points to 15,236 and France’s CAC 40 is expected to edge around 7 points higher to 6,169, according to IG data. Back in Europe, U.K. GDP grew 0.4% in February from the previous month according to official data published Tuesday, slightly missing economist expectations of a 0.6% expansion. Manufacturing output rose by 1.3%, outstripping expectations for a 0.5% monthly gain, while services output grew 0.2%, missing projections for 0.6% growth. April’s ZEW economic sentiment index for Germany and the euro zone is published at 10 a.m.
Earnings season also gets underway in Europe, with French luxury group LVMH reporting after the bell while, the U.K.’s JD Sports and French Connection and Switzerland’s Givaudan all report this morning.

Markets were quiet on Monday, with the three major indexes pulling back slightly. The S&P 500 finished just a hair under its previous record close, while the Dow slipped 55 points. The Nasdaq Composite was the laggard, shedding 0.4%.Futures this morning are flat ahead of the March reading for the consumer price index, scheduled to be released at 8:30 a.m. ET. Economists polled by Dow Jones are projecting the headline index to rise by 0.5% month-over-month and 2.5% year-over-year.
China’s exports in March rose 30.6% from a year ago, according to customs data released Tuesday. Economists had expected exports to grow 35.5% from a year ago, according to a Reuters poll. Chinese imports for March jumped 38.1% from a year earlier, above expectations in a Reuters poll for a 23.3% on-year increase. The rest of the region is pretty mixed with the MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.5%.
Oil prices edge higher on tensions in the Middle East after the Yemen-based Houthi movement said it fired missiles on Saudi oil sites and on an expected drawdown in crude oil inventory in the United States. Still, crude prices have remained rangebound in the past three weeks, as growing expectations of surging economic activity in the U.S. and China are balanced by the slow rate of vaccinations in Europe and anticipation of additional supply of oil from Iran in the coming months. Brent + 0.43% $ 63.55, WTI + 0.37 $ 59.91.
Gold slipped this morning as firmer U.S. Treasury yields took some sheen off the yellow metal, with optimism about a quick economic rebound weighing on prices further. Gold is 0.42% lower at $ 1725, Silver fell 0.6% to $24.69 and palladium inched down 0.1% to $2672.30. Platinum slipped 0.6% to $1163.57.