Opening Comment — Thursday, May 16, 2024
DJIA: 39,908.00, up 349.89
S&P 500: 5,308.15, up 61.47
NASDAQ: 16,742.39, up 231.21
Stocks higher after setting new all-time high
Stock futures are higher on Thursday, ahead of the release for April’s industrial production, housing starts, and other key economic data. The Dow and the S&P 500 are both rising 0.1%. The Nasdaq 100 is increasing 0.2% relative to fair value on the GLOBEX.
U.S. equities were higher on Wednesday, with all three major U.S. indexes setting new all-time highs after the headline April Consumer Price Index (CPI) came in softer than projections on a monthly basis and in line with expectations on an annual basis. The Dow was up 0.9%, while the tech-heavy Nasdaq Composite rose 1.4%. The S&P 500 increased 1.2% with 10 of 11 sectors finishing in positive territory. The Information Technology sector gained the most, rising 2.3%.
On the data front today, initial jobless claims for the week ending May 11 are expected to be 220,000, lower than the prior week’s 231,000, while continuing claims for the week ending May 4 are projected to register 1.78 million, slightly lower than the prior week’s 1.79 million. Housing starts for April are expected to be an annualized 1.42 million units, up from the prior month’s 1.32 million units, corresponding to an anticipated increase of 7.6% month-over-month (MoM) versus the prior month’s decrease of 14.7%. Meanwhile, April’s building permits issued are projected to be an annualized 1.48 million, up from the prior month’s revised reading of 1.47 million, corresponding to an expected increase of 0.9% MoM versus the prior month’s revised decrease of 3.7%. The Philadelphia Federal Reserve (Fed) business outlook survey for May will be released, with the diffusion index for current general activity projected to record 8.0 versus the prior month’s 15.5. April’s Import Price Index is expected to increase 0.3% MoM, down from the prior month’s increase of 0.4%. Meanwhile, April’s Export Price Index is projected to increase 0.2% MoM versus the prior month’s increase of 0.3%. Industrial production is expected to rise 0.1% MoM for April versus the prior month’s increase of 0.4%, while April’s capacity utilization is projected to register at 78.4%, similar to the prior month’s reading.
Across the pond, European stocks are mostly lower in mid-day trading, excluding Italy whose April CPI was unexpectedly revised lower.
Overnight in Asia, stocks were higher despite the initial reading for Japan’s first-quarter Gross Domestic Product (GDP) decreasing more than projections. Australia’s unemployment rate for April came in higher than projections.
In FOREX trading, the dollar is slightly higher following yesterday’s CPI report and ahead of today’s import and export price data.
Over in the commodity pits, West Texas Intermediate (WTI) crude oil is 0.3% lower at $78.36/barrel, despite indications of increased demand in the U.S.
In the metals complex, gold is 0.4% lower at $2386.20/ounce following a strengthening dollar.