Market Snapshot
Asia: Japan +0.8% to 19790. Hong Kong +3.8% to 26237. China +0.9% to 3995.5. India +0.7% to 28708.
Europe: London +0.6%. Paris flat. Frankfurt -0.4%.
Futures: Dow +0.1%. S&P +0.1%. Nasdaq flat. Crude -2.1% to $52.83. Gold +0.05% to $1211.30.
Ten-year Treasury Yield -1 bps to 1.883%.
Economic News
10:30 EIA Petroleum Inventories
2:00 PM FOMC minutes
Key earnings before the open
FDO, GPN, MSM, RAD, RPM
Key earnings after the close
AA, APOG, BBBY, DDC, MG, PIR, WDFC
Markets
Stock futures are slightly higher as the market gears up for earnings season and looks ahead to Fed minutes. Some oil stocks looks set to gain after Royal Dutch Shell (RDS.A) said it will acquire Britain’s BG Group in a deal valued at $69.6B. Also weighing in an otherwise quiet day for economic data is the rate-hike guessing game, with investors likely to spend much of the morning looking ahead to the FOMC minutes, which are slated to be released at 2:00 p.m. Eastern.
The Nikkei has hit a 15-year high after the Bank of Japan kept its monetary spigots on at full blast, with the BOJ’s board voting 8-1 to maintain its asset-purchase target at ¥80T a year. The Nikkei rose 0.8% to 19,789.81, its highest close since April 2000.
Saudi Arabia raised oil output to 10.3M barrels a day in March, the highest in at least 12 years, and intends to keep producing 10M bpd despite low crude prices. Oil minister Ali al-Naimi believes that oil will rise in the “near future” but even if it doesn’t, some expect the kingdom to hold firm until the slump in crude forces U.S. shale plays into bankruptcy.
German factory orders dropped 0.9% on month in February, which badly missing consensus of +1.5%. The reading contrasts with other reports, such as strong manufacturing PMI, that indicate strength in the economy.
Stocks
Apple (AAPL) has been downgraded by SocGen, which advises investors stop drooling over the Apple Watch and pay more attention to handset sales, which are the bulk of revenue. Currency and tough comparisons could make for a tricky second half, they say.
Alcoa (AA) gets the first-quarter earnings party started after the closing bell. Investors will focus on whether the metals giant remains as upbeat on the outlook for aluminum demand as it was three months ago.
The FTC has identified about 340 stores that Dollar Tree (DLTR) needs to sell as part of its $8.5B acquisition of Family Dollar (FDO). All or nearly all of the divestments should be Family Dollar stores, which the combined entity would sell to one or more interested buyers who would operate them as dollar stores.
Lions Gate Entertainment (LGF) dropped 3.4% in post-market trading following news that Mark Rachesky’s MHR Fund Management, the film company’s biggest shareholder, will sell almost 10M shares. MHR will retain over 41M shares after the sale and still remain Lions Gate’s largest investor with around 29%.
Noble Energy (NBL) is cutting 220 jobs across the U.S., with around 100 losses at the oil company’s Houston headquarters and another 100 or so at its Colorado operations. The cuts represent 10% of Noble’s 2,200 U.S. work force. The news follows an announcement earlier this year that it was planning to slash spending by 40%.
Shell (RDS.A, RDS.B) has agreed to purchase BG Group (BRGXF) for £47B ($69.6B) in a cash-and-stock deal that will add 25% to Shell’s proven oil and gas reserves and 20% to its production. The acquisition will also improve the latter’s prospects in new projects, particularly in Australian LNG and Brazilian deep water.
The performance of Twitter’s (TWTR) stock in a down market yesterday has given rise to more takeover rumors. Google (GOOG) and Facebook (FB) are the obvious choices, with reports saying Goldman Sachs was retained to fight off overtures.