Daily market review

United States

US equities ended flat to marginally weaker Tuesday in consolidative trading as they mostly held onto recent strong gains. The Dow Jones industrial average eased 0.3 percent while the S&P 500 and the NASDAQ both eased 0.1 percent.

Most sectors edged up, with energy faring best as it bounced back from Monday's weakness on a recovery in crude oil prices. The reopening trade bolstered consumer discretionary stocks, while consumer staples were bolstered by beverages; Coca-Cola gained 0.8 percent. Tech lagged after its rally Monday, and banks were dragged down financials as interest rates sagged.

Among companies in the news, Peloton rose 5.8 percent on a strong rating from Credit Suisse. Airlines perked up on reopening hopes, with Southwest up 1.8 percent after calling its pilots back to work. Ilumina, the biotech, rose 7.9 percent after pre-announcing a revenues beat for the first quarter. Snap, the social media company, rose 5.1 percent after an analyst upgrade.

On the downside, Paychex fell 4.9 percent despite an earnings beat. Greenbrier, the manufacturer, fell 4.8 percent after missing revenue expectations. Intel declined 1.5 percent, and Nvidia declined 0.9 percent in a retreat from Monday's gains.

In US economic data, job openings rose significantly in February, rising 3.8 percent on the month to 7.367 million to exceed Econoday's consensus range.

These price data reflect observations at 4:00 PM US ET: Dated Brent spot crude oil rose 58 cents to US$62.77 while spot gold rose US$13.87 to US$1,742.07. The US dollar dropped vs. most major currencies. The US Treasury 30-year bond yield fell 3 basis points to 2.32 percent and the 10-year note yield declined 5 basis points to 1.65 percent.


With UK markets leading, equities edged up Tuesday on the reopening trade. The FTSE-100 rose 1.3 percent, the Europe-wide STOXX 600 and the German DAX both rose 0.7 percent, and the French CAC rose 0.5 percent.

UK markets outperformed after Prime Minister Boris Johnson said the UK may be on track for a full reopening by June. UK stocks got another bump up from BP, which rose 3.8 percent after announcing it has hit its debt reduction target early, paving the way for stock buybacks.

Bullish was a report that vaccine supplies should allow EU member states to vaccinate everyone by June, much earlier than projected. On the negative side, financials were hit again by the Archegos affair, as Credit Suisse, down 0.4 percent, said it would take a CHF 4.4 billion write-down as a result.

Miners got a boost from rising commodities prices: Glencore rose 2.1 percent and Anglo American 3.1 percent.

Among sectors, basic resources, travel & leisure, food & beverage, personal & household, financials, autos, chemicals outperformed, while lagging were telecom, oil & gas, retail, banks, health care, and insurance.

Among stocks in the news, Norwegian Cruise Lines rose 12.2 percent after announcing its plan to resume operations around the US. Atari, the tech, rose 15.7 percent after announcing a restructuring including a blockchain unit. Cineworld, the UK movie chain, rose 5.7 percent on a positive mention in the Wall Street Journal.

Asia Pacific

Major Asian equities were mixed Tuesday, with mixed economic data and rising Covid-19 cases in focus, and mainland Chinese markets catching up after holidays, though Hong Kong remained shut.

Chinese markets recovered early losses to end mostly steady with the Shanghai composite flat and the CSI composite down 0.4 percent. US-China tensions and rising Covid counts were negatives while upbeat Chinese PMI services figures were positive. Value beat growth stocks, and sectors were split with energy and industrials better and consumer discretionary and health care lagging.

Japanese markets saw losses across the board as the Nikkei 225 index fell 1.3 percent and the broader dropped Topix 1.5 percent on profit-taking after good gains Monday. Worst off were banks, pharma, miners, and airlines. Weaker-than-expected household spending data dampened risk sentiment.

Australian stocks advanced on reopening hopes, with the All Ordinaries up 1.0 percent. New Zealand's announcement of a travel bubble with Australia gave travel stocks a boost.

Meanwhile, Afterpay jumped 10 percent on unexpectedly strong sales results to lead tech stocks higher. Gains were across the board, with airlines/travel boosting industrials and consumer discretionary. Energy and utilities lagged. The Reserve Bank of Australia kept policy on hold and pledged to keep rates steady, in line with expectations.

Among Asian companies in focus, Subaru fell 2.8 percent after cutting production due to chip shortages, and Daichi Sankyo, the Japanese pharma, fell 3 percent after announcing new investments in cancer treatments.

In economic data, the Caixin Chinese services PMI rose nearly 3 points in March to 54.3 underpinned by employment which also rose significantly. Separately, household spending in Japan, in real terms, fell 6.6 percent in February in what was the third straight annual decline. The consensus was for a 5.3 percent decline, marking the second straight lower-than-expected result.

Looking ahead*

On Wednesday in Asia/Pacific, the Reserve Bank of India policy announcement is due plus the Indian PMI composite report. In Europe, PMI composite finals are scheduled for France, Germany, Eurozone, and UK. In North America, the US international trade in goods and services report is due, plus Canadian Ivey PMI and Canadian merchandise trade figures.

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