>>> What to look at today - 20th of April 2016

Dow+0.14% S&P+0.14% Nasdasq-0.40% Russell+0.08%
US Market closed higher but was not able to settle above the 2,100. Japan's Nikkei (+3.7%) showed the largest uptick as commentary from Bank of Japan Governor Haruhiko Kuroda prompted speculation for future stimulus. At the same time, oil rebounded following yesterday's post-Doha meeting decline. energy (+1.9%) and materials (+2.1%) led financials (+1.1%) and telecom services (+0.8%). Conversely, heavily-weighted technology (-0.6%) and consumer discretionary (-0.5%) ended with the largest losses. Volume in line with average @ 877mil shares. US After Hours YHOO +2%, VMW +8.8%, MANH +7.1%, DFS +4.1%, IBKR +3.8%, ISRG +2.1%, LLTC +1.5%,CAMP -7.4%,WWD -2.4%, INTC -2.1% following earnings, ONCS +17.8% on +ve data, EMC+1.6% on VMware ern., Asian equity markets are trading mixed, though the modest gains observed in Australia and Japan are overshadowed by outsized losses in China. US equity futures are also pointing to a slightly lower open, while energy prices are down markedly after reports that Kuwait oil workers union has completed its strike. Shanghai Composite hit a 3-week low in the afternoon session below 2,950 with a decline of over 3% after the break on PBoC comments to the gov to be cautious to restrain lending and prevent company leverage ratios from overheating. In Japan, the latest merchandise trade figures were again "less bad". Terms of trade remained in surplus - albeit a smaller one than expected - while the declines in exports (-6.8% v -7.0%e) and imports (-14.9% v -16.6%e) components were both smaller than anticipated. Demand from Europe was especially surprising as exports rose for the 2nd straight month by 12%. Shipments to US were down over 5% and China by over 7%. Mitsubishi Motors (7211 JP) -16% on improper fuel test...Volkswagen contagion...

Nikkei +0.26% Hang Seng -1.35% Shanghai -3.57%

EUr$1.1357 CNH 6.4744 CNY 6.4660 JPY 108.94 GBP 1.4353 CHF 66.7319 RUB 66.5888 WTI 41.45 (-2.40%)

S&P-0.33% EuroStoxx -0.46% Dax -0.45% SMI- 0.28%

Macro :
- Eurozone 2016 GDP Growth View Cut to 1.5% From 1.8% by S&P
- Saudi Said to Borrow $10b From Mitsubishi UFJ, HSBC, JPM: FT
- Lagarde Says ’08-’09 Financial Crisis ‘Left Scars’: Le Figaro
- IMF’s Lagarde Says Doubtful Bank Loans Hamper Growth: Le Figaro
- Italy, Spain Banks Most Hit by Sovereign Exposure Cap: Bernstein

Keep an eye on :
- A2A IM : A2A to launch takeover bid on ACSM-AGAM
- ABBN VX : ABB 1Q Op. Ebita Beats Ests., Revenues Below
- AC FP : Accor 1Q Total Rev. In Line With Ests., LFL Sales Beat
- AC FP : Accor CFO Says Jin Jiang’s Intentions Haven’t Changed Since Feb.
- AKZA NA : AkzoNobel eyes small-to medium-sized takeovers - Het Financieele Dagblad
- ASML NA : ASML Sees 2Q Gross Margin Hit by EUV System Impact
- AXFO SS : Axfood 1Q Operating Profit Beats Estimates
- BAR BB : Barco 1Q Rev. EU255.1m vs EU241.6m Y/y; Confirms 2016 Outlook
- BSLN SW : Basilea Gets Contract by Barda of Up to $100m Funding
- BPI BP : Banco BPI Says It Doesn’t Recognize Santoro’s Version of Facts
- BETSB SS : Betsson 1Q Op. Profit Below Ests., Organic Growth ’Still Strong’
- BLT LN : +3% in Australia on numbers
- CABK SM : CaixaBank Studies Capital Increase for BPI Deal: Expansion
- CSGN VX : Credit Suisse Forms Team for Minority Hedge Fund Stakes: Buyouts
- CGG FP : Seismics Demand to Drop ~30% in 2016, Underweight TGS: JPMorgan
- DMGT LN : Daily Mail Said to Be Among Yahoo Bidders: WSJ
- EDF FP : EDF Employee Shareholders to Demand Delisting, AFP Says
- EDPR PL : EDPR Agrees to EU550m Asset Rotation Transaction Deal in Europe
- FIE GY : Fielmann 1Q Sales Little Changed; Pretax, Profit Fall
- GSK LN : Glaxo, Actavis Appeal U.K. ‘Pay-for-Delay’ Drug Antitrust Fines
- INTC US : Intel 2Q Rev. View Trails Est.; Plans to Cut 11% of Jobs
- INW IM : Inwit CEO says Cellnex bid better 'in theory' - La Stampa
- LSE LN : LSE and Deutsche Boerse working on common framework for clearing houses’ handling of bank defaults - FT
- SAP GY : SAP Confirms 1Q Preliminaries, 2016 Outlook; 1Q FCF Up 4%
- SYNN VX: Syngenta 1Q Rev In Line, ChemChina Deal to Complete by Year-End ,Syngenta Will Be Well Placed for When Market Improves: CEO
- TELIA SS : Telia 1Q Ebitda Beats Estimates; FY Guidance Raised
- TEMN SW : Temenos Reports Strong Start to 2016 1Q, Temenos Weak License Start Puts 2016 Goal at Risk: Baader-Helvea
- DG FP : Vinci Shareholders Approved Final Dividend of EU1.27 Per Share
- VOW3 GY : DOJ Said to Tell VW Not to Release Pollution Probe Results: WSJ
- VOW3 GY : VW Sued by Arizona AG Over Claims Diesel Rigging Cheated Buyers
- YHOO US : Yahoo 1Q Ebitda Tops Est., 2Q Ebitda, Rev. Outlooks Short
- ZC FP : Zodiac 1H Net EU43.7m vs EU109m; Confirms FY Target

>>> AkzoNobel eyes small-to medium-sized takeovers

AkzoNobel eyes small-to medium-sized takeovers 

AkzoNobel, the Dutch paints and chemicals company, is open for smaller and medium size takeovers, the Dutch daily Het Financieele Dagblad reported, citing AkzoNobel CFO Maëlys Castella.

The CFO said takeovers are considered if it brings AkzoNobel to new regions, if it brings the company new techniques, if it’s a good expansion of the portfolio or if it will boost the company’s growth in certain segments.

On Tuesday AkzoNobel announced that the company’s trading results over the first quarter of 2016 grew 17% y-o-y. However, turnover fell with 4%, mainly as a result of currency effects in Brazil, Argentina, Indonesia and Turkey, but also due to recent divestments.

AkzoNobel recently announced the takeover of the German company Basf for EUR 457m.

CFO Maëlys Castella also said that Special Chemicals is doing well and that the company plans to boost its profits. Rumours about a possible sale of Special Chemicals have been going around, and were neither denied nor confirmed by the CFO.

Last year AkzoNobel made a turnover of EUR 3.4b with profits of EUR 357m. The company’s pure profit rose 50% y-o-y to EUR 240m, the report said.

Het Financieele Dagblad

>>> Europe : Brokers Upgrades & Downgrades - 20th of April 2016

>>> Up
*ARCELORMITTAL RAISED TO BUY VS HOLD AT JEFFERIES
*BHP BILLITON RAISED TO HOLD VS SELL AT INVESTEC
*BURBERRY CUT TO NEUTRAL VS BUY AT GOLDMAN
*MINERVA FOODS RAISED TO BUY VS NEUTRAL AT GOLDMAN
*SALZGITTER RAISED TO BUY VS HOLD AT JEFFERIES
*VODAFONE RAISED TO BUY VS NEUTRAL AT BOFAML

>>> Down
*ACERINOX CUT TO HOLD VS BUY AT JEFFERIES
*ASHMORE GROUP CUT TO HOLD VS BUY AT SOCGEN
*BT GROUP CUT TO HOLD AT JEFFERIES
*BADGER METER CUT TO NEUTRAL AT BAIRD
*BOEING CUT TO UNDERPERFORM AT BOFAML
*COMPANIA CERVECERIAS UNIDAS CUT TO NEUTRAL VS BUY AT GOLDMAN
*L’OREAL CUT TO HOLD VS BUY AT SOCGEN
*OMNICOM CUT TO EQUALWEIGHT VS OVERWEIGHT AT BARCLAYS
*REMY COINTREAU CUT TO HOLD VS BUY AT SOCGEN
*REMY COINTREAU CUT TO MARKET PERFORM AT BERNSTEIN
*VOESTALPINE CUT TO HOLD VS BUY AT JEFFERIES

>>> PT Change


>>> Initiation
*BANCO SABADELL REINSTATED NEUTRAL AT CREDIT SUISSE, PT EU1.7
*PADDY POWER BETFAIR RATED NEW UNDERPERFORM AT CREDIT SUISSE
*ROBERT HALF RATED NEW BUY AT NOMURA, PT $56

>>> Call

>>> Asian Update

Asian Market Update: Japan trade balance still in surplus as exports and imports declines recede; PBoC chief economist warns about credit growth


***Economic Data***
- (JP) JAPAN MAR TOTAL MERCHANDISE TRADE BALANCE: ¥755.0B V ¥835BE (2nd consecutive trade surplus); ADJUSTED TRADE BALANCE: ¥276.5B V ¥450BE
- (AU) AUSTRALIA MAR SKILLED VACANCIES M/M: -1.2% V -1.2% PRIOR
- (AU) AUSTRALIA MAR WESTPAC LEADING INDEX M/M: -0.1% V -0.2% PRIOR
- (KR) South Korea Mar PPI Y/Y: -3.3% v -3.4% prior

***Index Snapshot (as of 04:30 GMT)***
- Nikkei225 +0.2%, S&P/ASX +0.4%, Kospi flat, Shanghai Composite -2.6%, Hang Seng -1.1%, Jun S&P500 -0.3% at 2,088

***Commodities/Fixed Income***
- June gold -0.1% at $1,253/oz, June crude oil -2.3% at $41.51/brl, May copper -0.5% at $2.21/lb
- (NZ) Fonterra Global Dairy Trade auction: Dairy Trade price index: +3.8% v +2.1% prior; 2nd straight increase; biggest increase in 6 months
- (US) Weekly API Oil Inventories: Crude: +3.1M v +6.2M prior; 2nd straight build
- GLD: SPDR Gold Trust ETF daily holdings fall 7.5 tonnes to 805.0 tonnes; lowest since Mar 16th
- (KU) Kuwait oil workers union has decided to cancel their strike after 3 days of output disruption - financial press
- (CN) China MoF sells 7-yr bonds at yield 2.94% v 2.83% on Jan 19th
- USD/CNY: (CN) PBOC SETS YUAN MID POINT AT 6.4579 V 6.4700 PRIOR; strongest Yuan setting in 4 months
- (CN) PBOC to inject CNY250B in 7-day reverse repos; largest injection since Feb 26th
- (JP) BOJ offers to buy ¥350B in 1-3yr JGBs, ¥440B in 3-5yr JGBs, ¥450B in 5-10yr JGBs
- (AU) Australia MoF (AOFM) sells A$1.2B in 2.75% 2027 Bonds; avg yield: 2.666%; bid-to-cover: 2.79x

***Market Focal Points/FX***
- Asian equity markets are trading mixed, though the modest gains observed in Australia and Japan are overshadowed by outsized losses in China. US equity futures are also pointing to a slightly lower open, while energy prices are down markedly after reports that Kuwait oil workers union has completed its strike. In FX, commodity currencies were under pressure with AUD/USD down about 40pips toward the $0.7780 level while NZD/USD retreated about 50pips to $0.70. Risk-off theme also sent USD/JPY down about 40pips to 108.90 session lows.

- In China, Shanghai Composite hit a 3-week low in the afternoon session below 2,950 with a decline of over 3% after the break. Comments from PBoC chief economist Ma Jun contributed to the caution as he called on govt to restrain lending and prevent company leverage ratios from overheating. Other reports noted Chinese companies sought cash to help pay their tax burdens.

- In Japan, the latest merchandise trade figures were again "less bad". Terms of trade remained in surplus - albeit a smaller one than expected - while the declines in exports (-6.8% v -7.0%e) and imports (-14.9% v -16.6%e) components were both smaller than anticipated. Demand from Europe was especially surprising as exports rose for the 2nd straight month by 12%. Shipments to US were down over 5% and China by over 7%.

- Elsewhere in Japan, ruling LDP party policy chief Inada hinted that the economic impact from the earthquake over the weekend could require a slower pace of sales tax increases - perhaps an incremental 1pt rise instead of the 2pts planned for Apr 2017. Govt spokesperson Suga shrugged off those remarks, stating that the situation after the earthquake this weekend is not similar to 2011 earthquake, and that there is no change of plan to raise sales tax in April 2017. BOJ Gov Kuroda spoke at length once again, reiterating that price trends are improving, economy is showing some recovery, and that there was no technical limit to lowering BOJ's negative rates. Kuroda also said there is great capacity for additional bond purchases. Speculation over expanded QE late this month has been increasingly more prevalent as traders test policymakers' patience by nudging USD/JPY further below 110 level.

- In Australia, Moody's warned that while economy will stay resilient, subdued commodities prices are starting to challenge some sectors. Moody's also noted elevated property prices and Australia's dependence on external financing. BHP reported its Q3 results and joined Rio Tinto in lowering its outlook for iron ore shipments this year. BHP's Q3 production of 53M tons was below 55Me and also down 10% y/y, as mining giant cut FY16 iron ore production to 229Mt from 237Mt. Petroleum output was down 3% y/y and copper down 12%. Nonetheless, shares traded higher since the reduced output guidance was attributed to bad weather and rail network maintenance as investors anticipate lower supply in the environment of steady demand for the rest of the year.

***Equities***
US equities / ADRs:
- VMW: Reports Q1 $0.86 v $0.84e, R$1.59B v $1.57Be; to repurchase up to $1.2B of class A common stock (6% of market cap); +8.8% afterhours
- IBKR Reports Q1 $0.51 (adj) v $0.45e, R$489M v $391Me ; +3.8% afterhours
- DFS: Reports Q1 $1.35 v $1.30e, R$2.22B v $1.76Be; +2.8% afterhours
- ISRG: Reports Q1 $4.42 v $4.30e, R$595M v $586Me; +2.3% afterhours
- LLTC: Reports Q3 $0.52 v $0.50e, R$361M v $359Me; +1.5% afterhours
- GPN: To enter S&P 500 index, replacing GME after the close of trading on Friday, April 22; KKD enters S&P SmallCap 600 index; +1.3% afterhours
- YHOO: Reports Q1 $0.08 v $0.07e, R$859M (ex TAC) v $846Me; +1.1% afterhours
- CPE Announces Midland Basin acquisitions; Establishes new core operating area for total consideration of $220M in cash and 9.3M shares of common stock; -1.5% afterhours
- INTC: Reports Q1 $0.54 v $0.49e, R$13.8B v $14.0Be; Announces 12K in jobs cuts (as speculated; ~11% of workforce); announces CFO transition; -2.1% afterhours

Notable movers by sector:
- Industrials: China Cosco Holdings Co 1919.HK +1.3% (sets up alliance); Taisei Corp 1801.JP -0.5% (FY15/16 result speculation); Doosan Heavy 034020.KR -1.8% (Q1 result)
- Technology: Asahi Glass Co 5201.JP +2.3% (Q1 result speculation)
- Materials: BHP Billiton BHP.AU +3.9% (Q3 result)
- Energy: Idemitsu Kosan Co 5019.JP +6.7% (guidance); Woodside Petroleum WPL.AU -1.1% (Q1 result)

>>> US After Hours Summary: YHOO +2%, INTC -2% following earnings


After Hours Summary: YHOO +2%, INTC -2% following earnings

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: VMW +8.8%, MANH +7.1%, DFS +4.1%, IBKR +3.8%, ISRG +2.1%, YHOO +1.8%, LLTC +1.5%

Companies trading higher in after hours in reaction to news: ONCS +17.8% (presents 'positive' data on ImmunoPulse IL-12), EMC +1.6% (following VMware (VMW) earnings and ahead of its own earnings release tomorrow before the open), CRVS +1.4% (announces results of three preclinical studies of CPI-444)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: CAMP -7.4%, WWD -2.4%, INTC -2.1%

Companies trading lower in after hours in reaction to news: KITE -2.5% (announces updated clinical results from Phase 1 portion of ZUMA-1 trial; affirms the early safety and efficacy profile of KTE-C19 in chemorefractory, aggressive NHL), CPE -1.3% (raises 2016 oil production guidance; acquire certain assets operated by Big Star Oil and Gas for $220 mln in cash and 9.3 mln CPE shares), JASO -1.1% (sued by Hemlock Semiconductor)

WSJ : Yahoo’s Troubles Mount as Bids Begin

Yahoo’s Troubles Mount as Bids Begin
Verizon Communications, Daily Mail, TPG all submit separate bids

Suitors for Yahoo Inc. got a reminder of the challenges facing the struggling Web business on Tuesday when the company again reported fast-shrinking revenue.

The Internet portal said its revenue dropped 18% to $859.4 million, excluding commissions paid to search partners, the first time that figure has fallen below $1 billion since Chief Executive Marissa Mayer took the reins nearly four years ago.

Ms. Mayer, on a video call with analysts, put a brave face on the company’s flagging financials, calling the quarter a “good start to the year.” But she also stressed to investors that Yahoo’s management has made the auction process the “top priority” as the deadline passed Monday for preliminary bids.

“Our board and management team are fully committed to maximizing value for shareholders and are completely aligned in the pursuit of strategic alternatives,” she said.

Ms. Mayer didn’t identify any of the bidders or disclose further details about the auction process.


Verizon Communications Inc., U.K. publisher Daily Mail and buyout firm TPG all submitted separate bids, people familiar with the process said. An investor group that included Bain Capital, Vista Equity Partners and former Yahoo CEO Ross Levinsohn also made a bid, people familiar with the matter said.

Two other private-equity firms, Silver Lake and Advent International, had also expressed interest in bidding around the time of Yahoo’s deadline, people familiar with the matter said.

Most of the bids came in the range of between $4 billion and $8 billion, a person familiar with the process said.

The company now plans to choose which bidders move on before providing them with access to more financial data and setting a deadline for final bids, the person said.

A Yahoo spokeswoman declined to comment.

Yahoo is under pressure to show progress toward a sale by the time the company holds its annual shareholder meeting this summer, when investors will likely vote on Starboard Value LP’s proposal to replace the entire nine-person board with a new slate of directors.

Starboard has criticized Yahoo for moving too slowly to sell the company and for potential conflicts of interest in involving Ms. Mayer too closely in the sale process. Potential buyers have also expressed frustration that Yahoo’s managers have failed to answer detailed questions about its business prospects, people familiar with the process told The Wall Street Journal earlier this month.

“There is a fair amount of skepticism about their willingness to really sell the business,” Youssef Squali, analyst at Cantor Fitzgerald, said in an interview.

Ms. Mayer addressed those concerns at the start of the analysts’ call, saying management has talked to the strategic review committee daily through phone and in-person meetings, answered hundreds of questions about the business and set up a data room to give suitors insight into its financial metrics.

“The management team and I have supported the board’s process from the start,” she said, “and we are moving expeditiously.”

Ms. Mayer punctuated her assessment of the business with reflective remarks that attempted to summarize her legacy at Yahoo. “Over the past three and a half years, we took a company that, despite its rich history, faced revenue declines, and moved towards a Yahoo that is stronger and more modern,” she said.

Yahoo’s core business could be worth between $4 billion and $5 billion, Mr. Squali estimated. That excludes the value of real estate and patents, which he estimates could be worth an additional $1 billion to $2 billion.

The company said it ended the quarter with $7.1 billion in cash. Yahoo also owns stakes in Alibaba Group Holding Ltd. and Yahoo Japan, currently worth about $23 billion and $10 billion, respectively, not including the tax bill that would arise from a sale of those assets.

Yahoo’s ability to fetch a high price for its assets may be hampered by its declining performance. Overall, revenue fell 11% to $1.09 billion, edging in above the $1.08 billion predicted by a consensus of analysts. Yahoo posted a loss of $99.2 million, or 10 cents a share, compared with a year-earlier profit of 2 cents a share.

Notably, the segment of Yahoo’s business that Ms. Mayer has designated as the growth engine is slowing down dramatically. Revenue from “Mavens”—a financial metric the company introduced earlier this year to track mobile, video, native and social ads—rose 6.8% from the prior year to $390 million. That compares with 26% in last year’s fourth quarter, 43% in the third period and 60% in the second quarter.

Part of that slowdown is due to increasing competition in mobile search. Revenue from search ads, excluding commissions, declined 21% to $347.7 million.

Potential buyers could benefit from a licensing relationship with Yahoo Japan that delivers Yahoo about $200 million in pure profit annually, finance chief Ken Goldman said on the call with analysts. About half of those fees are set to expire in August 2017, but another component has no expiration date, Mr. Goldman said.

Yahoo has worked to reduce costs by trimming staff and shuttering products, including seven digital magazines. Yahoo said achieved $297 million in free cash flow in part from these cost-cutting efforts.

Yahoo is still losing ground to Alphabet Inc. and Facebook Inc. This year, Yahoo will claim 1.5% of the global market for online ads, down from a 2.4% share last year, estimates eMarketer Inc.

>>> US Close Dow+0.14% S&P+0.14% Nasdasq-0.40% Russell+0.08%

Closing Market Summary: Dow and S&P at 2016 Highs as Oil Rallies

The S&P 500 ended its day higher by 0.3% after the index tested, but could not make a sustained move above the 2100 level. Today's trade featured weaker than expected housing data, an uptick in oil, mixed quarterly earnings reports, and, as a result, split performances between heavily-weighted financials (+1.1%) and technology (-0.9%). The Nasdaq Composite (-0.4%) ended its day behind the S&P 500 (+0.3%) and the Dow Jones Industrial Average (+0.3%).

Equity indices opened their day higher as global bourses exhibited increased risk appetite overnight. Japan's Nikkei (+3.7%) showed the largest uptick as commentary from Bank of Japan Governor Haruhiko Kuroda prompted speculation for future stimulus. At the same time, oil rebounded following yesterday's post-Doha meeting decline.

However, the major averages pulled back from their session highs as the heavily-weighted health care (+0.3%) space pulled away from its initial 0.9% gain. This pullback also corresponded with a downturn in the broader market after the benchmark hit a session high at 2104 and backed away from that level into the close.

By the end of the session, eight sectors finished above their flat lines as commodity-sensitive energy (+1.9%) and materials (+2.1%) led financials (+1.1%) and telecom services (+0.8%). Conversely, heavily-weighted technology (-0.6%) and consumer discretionary (-0.5%) ended with the largest losses.

The energy space (+1.9%) moved higher with oil as WTI crude finished its day higher by 2.8% at $42.34/bbl. The energy component has benefited from reports out of Kuwait that its oil and gas workers strike has extended into its third day. Meanwhile, the sector looks ahead to tonight's weekly API data. The inventory data is expected to show that crude stockpiles rose by 1.60 million barrels, compared to last week's build of 6.22 million barrels.

The economically-sensitive financial sector (+1.1%) extended its April gain to 3.6% as money center banks and investment brokerages moved higher in sympathy with Goldman Sachs (GS 161.65, +3.63). The company reported a bottom-line beat and light revenue for the first quarter. Meanwhile, Goldman Sachs also disclosed that revenue declined 40.3% on year-over-year basis. However, the stock recovered from a 1.3% loss to end higher by 2.3%. To be fair though, money center banks and investment brokerages are also likely benefiting from an uptick in oil, in light of their exposure to oil and gas assets.

In the technology space (-0.6%), Alphabet (GOOGL 776.25, -11.43) fell 1.5% after headlines indicated that that the European Union is scheduled to file an antitrust suit against the tech name regarding required applications on Android devices. Meanwhile, Dow component IBM (IBM 144.00, -8.53) was the worst performer in the price-weighted index after issuing below-consensus guidance for the second quarter. Additionally, IBM did beat top and bottom-line estimates for the quarter, but revenue fell 4.6% year-over-year.

Biotechnology underperformed in the health care space (+0.3%), evidenced by the 1.9% decline in the iShares Nasdaq Biotechnology ETF (IBB 279.53, -5.44). Conversely, Dow component UnitedHealth (UNH 130.50, +2.69) was the best component in the price-weighted index. The company gained 2.1% after beating bottom-line estimates and raising its full year earnings guidance to $7.75-7.95 per share from $7.60-$7.80 per share.

The PHLX Semiconductor Index (-1.2%) displayed relative weakness ahead of Intel's (INTC 31.60, -0.05) quarterly report this evening. Meanwhile, Skyworks (SWKS 72.23, -2.51) and Qorvo (QRVO 45.24, -1.92) lost a respective 3.4% and 4.1% after being downgraded from "Strong Buy" to "Outperform" at Raymond James.

The U.S. Dollar Index (94.06, -0.43) finished its day off its low as the greenback made up some ground against the euro and the Canadian dollar. The dollar/Canadian dollar pair ended at 1.2659 (-1.0%) while the euro finished higher by 0.4% (1.1362).

The Treasury complex ended its day lower with the yield on the 10-yr note rising two basis points to 1.79%.

Today's participation was above the recent average as more than 877 million shares changed hands on the NYSE floor.

Today's economic data included March Building Permits and Housing Starts: 

  • The Housing Starts and Building Permits report for March was definitely a disappointment. Starts fell 8.8% from the prior month to a seasonally adjusted 1.089 million units (consensus 1.17 million). 
    • The weakness in starts was presumably due to some of the typical Spring building getting pulled forward during the warmer-than-usual winter months. To be sure, there is always an excuse for everything in a trending market.
    • The downturn was paced by a 9.2% slide in single-family starts, which saw declines in all regions: Midwest (-21.2%), West (-9.1%), Northeast (-8.6%), and the South (-4.9%). Multi-unit starts were down 7.9%.
  • Building permits, meanwhile, declined 7.7% to 1.086 million (consensus 1.200 million).
    • Building permits are a leading indicator, so the March data is not an encouraging sign for future building activity. Only the South (+1.8%) saw a pickup in permits for single-family units.
  • The one positive in the report is that the number of homes under construction jumped to 990,000 from 985,000 in February. That will be a positive input in first quarter GDP forecasts as the first quarter average of 984,000 was above the fourth quarter average of 962,000.

Tomorrow's economic data will be limited to the weekly MBA Mortgage Index and March Existing Home Sales (consensus 5.30 million), which will cross the wires at 7:00 ET and 10:30 ET, respectively. 

  • Dow Jones +3.6% YTD
  • S&P 500 +2.8% YTD
  • Russell 2000 +0.4% YTD
  • Nasdaq -1.2% YTD