U.S. Futures, Asia Stocks Up on Stimulus and Earnings

29/04/2021 U.S. equity futures jumped Thursday and Asian stocks rose, buoyed by robust earnings from technology heavyweights and the prospect of more stimulus to spur the economic recovery from the pandemic. S&P 500 and Nasdaq 100 contracts were in the green, with the latter outperforming after Apple Inc. crushed revenue estimates and Facebook Inc. reported increases in sales and users. In South Korea, Samsung Electronics Co. beat analysts’ profit forecasts but warned of further fallout from chip shortages. Hong Kong and China gained. Japan is shut for a holiday. The dollar held at lows after the Federal Reserve signaled it’s not ready to consider scaling back policy support. The Fed said it will continue with asset purchases and described inflation pressures as likely “transitory.” Crude oil extended gains on a confident outlook on demand from OPEC and its allies, despite the threat from India’s Covid-19 crisis. Commodities such as silver, copper and iron ore resumed rallies. Tencent trades 1.03% higher in HK. The JSE Top 40 futures are indicating a slightly higher start, up 123 points or 0.20%, with the Rand that has strengthened to 14.24 vs the USD.
Here are some key events still to watch this week:

  • U.S. GDP Thursday is forecast to show growth strengthened in the first quarter
    The FTSE/JSE Africa All-Share Index closed up 0.2% to 67,740.11, mostly supported by the property and banking sector that closed the session up 3.05% and 2.27% respectively, with the precious metals and mining index that weighed, closing down 1.08%. The Rand was up 0.7% to 14.28 per US$, with the Yield on 10-year govt rand bonds that rose 5.90bps to 9.22%.
    President Cyril Ramaphosa continues his testimony before the Judicial Commission of Inquiry into allegations of state capture and corruption led by Deputy Chief Justice Raymond Zondo.
  • NEWS:
  • Mango Resumes Flights as Feud With South Africa Airports Ends
  • BioNTech Weighs Making Covid Shots in Africa to Expand Reach
  • South Africa to Add Sputnik, Sinopharm Shots to Vaccine Arsenal
  • South Africa’s ANC Takes Responsibility for Graft, Ramaphosa Says
  • Shell, BP Options for South African Refinery Include Sale: DMRE
  • EQUITY PREVIEW:
  • S. Africa Stocks Chase Sixth Month of Gains as Markets Await Fed
  • Life Healthcare Sees 1H Revenue 0.9% to 6.1% Higher Y/Y
  • MEDIA SUMMARIES:
  • Daily Maverick: Four days of Ramaphosa at the State Capture Commission could be crucial for SA’s future
  • Moneyweb: Government, auto sector look to accelerate new-energy vehicle production in SA

ECONOMIC DATA:

  • 11:30am: March PPI MoM, est. 0.7%, prior 0.7%
  • 11:30am: March PPI YoY, est. 4.5%, prior 4.0%

CORPORATE EVENTS:

  • Annual General Meetings: GLEN LN
  • Sales Results: GLEN LN, SOL SJ

EU/UK
European stocks closed mixed on Wednesday as traders awaited comments from the U.S. Federal Reserve. The pan-European Stoxx 600 ended the session little changed, with banks adding 1.5% — led by a surge of Deutsche Bank’s share price — while industrials fell 0.7%. European investors are digesting a slew of earnings reports from Deutsche Bank, Sanofi, Dassault Systemes, Banco Santander, French Connection, GlaxoSmithKline and Lloyds Banking Group, among others. Deutsche Bank reported a 908 million euro ($1.1 billion) profit for the first quarter, its strongest quarterly profit for seven years, buoyed by continued strong performance in its investment banking division. The German lender’s shares surged 10.7% to lead the Stoxx 600 by the market closed Wednesday, while Lloyds added 3.5% after also beating earnings expectations. Delivery Hero’s strong 2021 outlook sent the German food delivery company’s stock 9.4% higher. At the bottom of the index, Swedish cloud software company Sinch fell 10.8% after its interim first-quarter report.
US
The S&P 500 closed around the flat line on Wednesday after the Federal Reserve left interest rates unchanged in its latest policy decision and hinted that it would keep easy monetary policy where it is for some time despite a strengthening economy and rising inflation. The S&P 500 dipped 0.08% to 4,183.18, despite touching an intraday record earlier in the session. The Dow Jones Industrial Average shed 164 points to close at 33,820.38, dragged down by a 7.2% drop in Amgen’s stock on disappointing earnings. The Nasdaq Composite traded lower by 0.28% to 14,051.03. The Fed wrapped up its two-day policy meeting on Wednesday, where the central bank left rates near zero. It upgraded its assessment of the economy and acknowledged inflation was rising. The small-cap benchmark Russell 2000 was the relative outperformer on Wednesday, rising about 0.1%. Boeing lost nearly 3% after posting its sixth straight quarterly loss, which also weighed on the Dow. Google parent Alphabet reported better-than-expected earnings after the bell on Tuesday, sending shares of the tech giant up 3%. Alphabet saw its revenues grow 34% from a year ago. Meanwhile, Microsoft shares dipped 2.8% even after the company topped analyst estimates. Microsoft had its largest revenue growth since 2018, thanks in part to gains in PC sales resulting from coronavirus-driven shortages last year. Technology darlings Apple and Facebook both report earnings on Wednesday after the bell.
ASIA
Asian shares extended gains on Thursday after the Federal Reserve said it was too early to consider rolling back emergency support for the economy, and U.S. President Joe Biden proposed an $1.8 trillion stimulus package. MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS built on early gains and was up 0.46% by mid-afternoon. Australia’s S&P/ASX 200 .AXJO edged up 0.24%, as strong oil prices lifted energy stocks. China’s blue-chip CSI300 index .CSI300 was 0.45% higher, while Hong Kong’s Hang Seng index .HSI rose half a percentage point. Seoul’s KOSPI .KS11 was flat while Taiwan shares .TWII rose 0.17%. Markets in Japan were closed for a holiday but Nikkei futures NKc1 rose 0.35% to 29,055 points.
COMMODITIES
Gold gained momentum after the U.S. Fed’s pledge for an accommodative fiscal policy stance, rising 0.3% to $1,786 an ounce by 11:14 a.m. in Shanghai. Silver, platinum and palladium all advanced.
Oil prices extended gains on Thursday after rising 1% the previous session, as bullish forecasts on recovering demand this summer outweighed concerns about the impact of rising COVID-19 cases in India, Japan and Brazil. Brent crude for June rose 22 cents, or 0.3%, to $67.49 a barrel.
Copper’s rally toward $10,000 a metric ton accelerated, with focus turning to whether it will take out the all-time high set in 2011, as rebounding economic growth and climate pledges spur a surge in demand. Copper rose as much as 1.2% to $9,997 a ton on the London Metal Exchange, the highest since 2011, before trading back at $9,960.
China’s steel futures headed for fresh records as the government added to a sweep of measures aimed at reining in output and emissions in the world’s top producer. Iron ore rebounded.