* All 3 major U.S. stock indexes green; Nasdaq, chips
outfront
* Energy biggest gainer among S&P sectors; staples lags most
* Euro STOXX 600 index up ~0.4%
* Dollar, gold ~flat; gold slips, crude slides
* U.S. 10-Year Treasury yield ~1.56%
April 26 - Welcome to the home for real-time coverage of
markets brought to you by Reuters reporters. You can share your
thoughts with us at markets.research@thomsonreuters.com
DROPPING AIRCRAFT ORDERS KEEP DURABLE GOODS EARTHBOUND (1030
EDT/1430 GMT)
New orders for U.S.-made durable goods - which
includes everything from waffle irons to fighter jets - grew by
a tepid 0.5% in March, according to the Commerce Department.
The number fell well short of the 2.3% consensus and
represents only a slight rebound from February's 1.1% decline,
which was largely attributable to bitter winter storms that
paralyzed much of the country.
Plunging aircraft/parts orders capped broader gains, with
defense and non-defense dropping 20.2% and 46.9%, respectively.
But a 5.5% gain in autos/parts and a 3.8% advance in defense
capital goods excluding aircraft kept the headline number
positive.
"As the economy reopens more broadly, industrial activity
will continue to be propelled by strong tailwinds including
large fiscal stimulus, buoyant demand, and strong corporate
profits," writes Lydia Boussour, lead U.S. economist at Oxford
Economics. "These should more than outweigh ongoing headwinds
from stretched supply chains and the global semiconductor
shortage."
"We expect non-residential private fixed investment to grow
7.6% this year, the fastest since 2012," Boussour adds.
Core capital goods, which excludes aircraft and
defense, and is seen as a barometer of business spending
intentions, also fell short of expectations, rising 0.9% versus
the 1.5% projected by economists.
Even so, new orders for core capital goods are up 10.4%,
year-on-year.
"We hoped for bigger recoveries in orders ex-transportation
and core capital goods orders, following the huge hit from the
winter storm in February," says Ian Shepherdson, chief economist
at Pantheon Macroeconomics. "But it's far too soon to argue that
these data signal a moderation in the pace of the industrial
recovery."
Investors began this heavy earnings week in a modestly
risk-on mood.
All three major U.S. stock indexes were green in early
trading, with economically sensitive small caps and chips
out front.
(Stephen Culp)
*****
NASDAQ COMPOSITE: CAN IT MAINTAIN ORBIT? (0900 EDT/1300 GMT)
With Nasdaq's titans expected to release quarterly numbers
this week, the Nasdaq Composite may be at an important
juncture. This after the Composite ended Friday within 1% of its
Feb. 12 record-high weekly close of 14,095.
Meanwhile, one measure of the Nasdaq's internal strength hit
a fresh record high on Friday. Despite this, of some concern,
this measure's momentum is waning:
Indeed, Nasdaq's cumulative net new highs (NNH)
(running sum of new highs - new lows), on a weekly basis,
bottomed in early April 2020, and has been trending up, above
its 12-week moving average (WMA), for 47 straight weeks. The
measure ended Friday at an all-time high of about 175k.
Of note, just looking back over the past 6 years or so,
periods when cumulative weekly NNHs were above its 12-WMA have
coincided with protracted Nasdaq strength. Conversely, periods
when cumulative NNHs were below the 12-WMA have occurred with
Nasdaq instability.
The spread between the measure and its 12-WMA is still
positive. That said, its thrust is waning. The spread peaked on
Feb. 12, or with the Composite's weekly closing high. It has
since contracted nine out of the past 10 weeks.
A weekly down-tick in cumulative NNHs, followed by a break
of its 12-WMA, could suggest that an important bearish trend
change is occurring within the Nasdaq. In that event, gravity
may then prevail.
(Terence Gabriel)
*****
FOR MONDAY'S LIVE MARKETS' POSTS PRIOR TO 0900 EDT/1300 GMT
- CLICK HERE:
(Terence Gabriel is a Reuters market analyst. The views
expressed are his own)