Daily Game Plan

TODAY’S GAME PLAN:  from the trading
desk, this is not research

DATA/HEADLINES:  8:30ET PCE Deflator*, Personal Income – Spending; 10:00ET U. of Mich. Sentiment; 11:00ET Kansas
City Fed Services Activity

TODAY’S HIGHLIGHTS and News:  

• Chinese Stocks in Hong Kong Are the World’s Top Gainers in April
• Jeff Bezos is accused of destroying chats amid an FTC antitrust probe
• Secretary of State Antony Blinken is meeting Xi Jinping in Beijing today
  
• A record six quarterbacks were selected in the first 12 picks of the NFL draft
  

Global equities rose after earnings from Alphabet and Microsoft beat estimates. The Bank of Japan kept interest rates around zero after their policy meeting and highlighted
a growing conviction that inflation was on track to hit its 2% target in coming years, signaling its readiness to hike borrowing costs later this year. BOJ Governor Ueda offered few clues on when the next rate hike will come and ruled out shifting to a full-fledged
reduction in the BOJ’s bond purchases. Elsewhere, euro zone consumers lowered their expectation for inflation over the next 12 months but continued to see price growth above the ECB’s 2% target further out, the ECB’s Consumer Expectations Survey showed. Consumers
in the region continued to expect negative economic growth for the next year with GDP seen contracting by 1.1%. Focus now turns to the Federal Reserve’s preferred inflation gauge, which will provide more clues on the central bank’s policy path.   

EQUITIES: 

US equity futures jumped as blockbuster earnings from tech giants Microsoft and Alphabet signaled the artificial intelligence boom that has driven gains for technology stocks remains
on track. The moves came ahead of a fresh reading of US core personal consumption expenditures, the Fed’s preferred inflation measure, that could sway rate cut hopes. Alphabet surged as much as 12% in post-market trading, on track to add more than $230 billion
to its market capitalization and exceed $2 trillion in valuation. The strong earnings were a relief to investors worried about lofty valuations in the tech sector and came after the market was rattled by data showing a sharp US economic slowdown and stubborn
inflation. Almost 80% of S&P 500 firms that have reported so far have beaten analysts’ earnings estimates, according to JPMorgan Chase strategists.   

Futures ahead of the data: E-Mini S&P +0.75%, Nasdaq +1%, Russell 2000 +0.05%, DJI +0.1%.

In pre-market trading, Alphabet (GOOGL) soars 12% after the Google parent reported first-quarter revenue that beat expectations, with artificial intelligence boosting growth in its cloud
business. Intel (INTC) drops 7.8% after the chipmaker’s second-quarter outlook was weaker than anticipated. Snap (SNAP) surges 26% after the social-media company reported first-quarter results that beat expectations and gave a stronger than forecast outlook.
Microsoft (MSFT) rises 4.4% after the software giant reported third-quarter results that beat expectations. AbbVie (ABBV) rises 2.1%  after lifting its full-year profit guidance as newer anti-inflammatory treatments take over for Humira. Atlassian (TEAM) slides
6% after the application software company said co-founder Scott Farquhar is stepping down as co-CEO after 23 years. Boyd Gaming (BYD) falls 13% after the regional casino operator reported an earnings miss. Roku (ROKU) slips 3.6% as the streaming-video platform
company said it expects adjusted Ebitda to moderate in the second half of the year. Skechers (SKX) jumps 11% after the footwear company boosted its full-year sales forecast. US Silica Holdings (SLCA) jumps 19% on a deal to be bought out by funds managed by
affiliates of Apollo Global Management.

European shares climbed, with basic resources and construction shares leading the advance. Miners rose as copper hit $10,000 a ton for the first time in two years, though Anglo American
underperformed after rejecting BHP Group’s $39 billion takeover proposal. Chemicals are in the red after disappointing earnings from IMCD NV. Thyssenkrupp AG jumped more than 10% after Czech billionaire Daniel Kretinsky’s EP Corporate Group agreed to take
a 20% stake in the German company’s troubled steel unit. Amundi SA rose more than 5% after reporting net inflows for the first quarter that beat analyst estimates. Meanwhile, at the ECB, Governing Council member Fabio Panetta warned that a return to ultra-low
interest rates may be required if cuts aren’t made soon. Stoxx 600 +0.7%, DAX +0.7%, CAC +0.3%, FTSE 100 +0.5%. Basic Resources and Construction sectors +1.6%, REITs +1.4%, Technology +1.4%, Banks +1.25%.

Asian stocks rose as investors cheered upbeat earnings from technology firms and sentiment on China continued to improve. Japanese stocks rose as the yen weakened following the Bank of
Japan’s decision to keep its monetary policy settings unchanged.  The MSCI Asia Pacific Index gained 0.7%, extending its weekly gain to more than 3%. Stocks rose in mainland China and Hong Kong, with the Hang Seng China Enterprises Index capping its best week
since April 2015. Signs of an improving Chinese economy, better corporate earnings and Bejing’s support measures have spurred inflows from global funds. Australian stocks bucked the region’s trend, dragged lower by BHP Group on its takeover bid for Anglo American.
Hang Seng Tech +4.6%, Hang Seng Index +2.1%, CSI 300 +1.5%, Taiwan +1.3%, Kospi +1%, Topix +0.9%, Philippines +0.8%, Vietnam +0.4%. Singapore -0.2%, Sensex -0.8%, ASX 200 -1.4%.

FIXED INCOME: 
 

Treasuries gained after a rout this week pushed yields to their highest levels of the year. The long-end is outperforming, mildly flattening spreads. US session highlight
is PCE deflator and March personal income and spending data. US yields are richer by up to 2bp across long-end of the curve with 5s30s spread around 8bp, tighter by around 1bp on the day. 10-year yield is around 4.685%, down ~2bp on the day. 

METALS: 
   

Gold edged up ahead of US inflation data due this morning but is still headed for a weekly loss. Traders are awaiting the release of the personal consumption expenditures
index, which is expected to show price pressures remained elevated in March. On Thursday, another key measure of inflation jumped, casting doubt on the Federal Reserve’s ability to start lowering borrowing costs soon. Still, Thursday’s inflation print coincided
with a report on US gross domestic product that trailed forecasts, rekindling the prospect of stagflation. Spot gold +0.5%, silver +0.6%.    

ENERGY:   

Crude oil prices nudged higher, on track to end a two-week losing streak, after a top US official expressed optimism over economic growth. Treasury Secretary Janet
Yellen told Reuters that the US GDP growth for the first quarter could be revised higher, and inflation will ease after a clutch of “peculiar” factors held the economy to its weakest showing in nearly two years. Supply concerns also remained amid ongoing conflict
in the Middle East. Israel stepped up air strikes on Rafah despite allies’ warnings the attacks could cause mass civilian casualties. WTI +0.5%, Brent +0.6%, US Nat Gas -1.6%, RBOB +0.5%.

CURRENCIES:   

In currency markets, the BOJ’s lack of clear guidance on the future rate hike path triggered a broad-based decline in the yen , pushing it down to a fresh 34-year
low near 157 to the dollar and keeping markets on edge over a currency intervention. In the quarterly outlook, the board projected core consumer inflation to hit 2.8% in the year that began in April, before slowing to 1.9% in fiscal 2025 and 2026. The dollar
fluctuated as traders awaited the US core PCE inflation data for March. Australian and New Zealand dollars both extended their rise for a fifth session as local bond yields climb. US$ Index +0.01%, GBPUSD +0.02%, EURUSD -0.1%, USDJPY +0.75%, AUDUSD +0.3%,
USDNOK +0.3%.

Spot Bitcoin %, Ethereum -1.3%.

TECHNICAL LEVELS:  

Colors within the report:
Green is always the 200 period (day, week).
Red is always 21,
Blue = 50,
Brown =
100 *Stars have added importance 

• Upgrades
• Acadia Health (ACHC) Raised to Hold at Deutsche Bank
• Choice Properties REIT (CHP-U CN) Raised to Buy at Canaccord; PT C$14.50
• Citizens Financial (CFG) Raised to Overweight at Piper Sandler; PT $41
• Compass Minerals (CMP) Raised to Buy at Loop Capital; PT $23
• Dow (DOW) Raised to Overweight at JPMorgan; PT $61
• Enphase Energy (ENPH) Raised to Overweight at Barclays; PT $134
• Epam Systems (EPAM) Raised to Equal-Weight at Morgan Stanley; PT $225
• LeMaitre Vascular (LMAT) Raised to Buy at Stifel; PT $75
• Spotify (SPOT) Raised to Buy at Phillip Secs; PT $340
• Raised to Buy at CFRA; PT $325
• Visteon (VC) Raised to Equal-Weight at Wells Fargo; PT $108
• Western Digital (WDC) Raised to Buy at Benchmark; PT $85
• Downgrades
• AMD (AMD) Cut to Hold at Erste Group
• Apple (AAPL) Cut to Hold at Erste Group
• Argo Blockchain (ARB LN) ADRs Cut to Neutral at HC Wainwright
• AssetMark Financial (AMK) Cut to Neutral at JPMorgan; PT $37
• Boyd Gaming (BYD) Cut to Hold at Deutsche Bank
• Cut to Neutral at JPMorgan; PT $67
• Bunge Global (BG) Cut to Hold at HSBC; PT $105
• Caterpillar (CAT) Cut to Hold at Stifel; PT $350
• Celestica (CLS CN) Cut to Neutral at CIBC; PT C$67.03
• Envista Holdings (NVST) Cut to Equal-Weight at Morgan Stanley; PT $21
• First Citizens (FCNCA) Cut to Neutral at Piper Sandler; PT $1,950
• Hibbett Inc. (HIBB) Cut to Neutral at Baird; PT $87.50
• Knight-Swift (KNX) Cut to Hold at Stifel; PT $47
• Mobileye (MBLY) Cut to Underweight at Morgan Stanley; PT $25
• Range Resources (RRC) Cut to Sector Perform at RBC; PT $39
• WNS Holdings Cut to Hold at Deutsche Bank(Earlier)
• Initiations
• DT Midstream (DTM) Rated New Underperform at Baptista Research
• H World Group Ltd (HTHT) ADRs Reinstated Buy at CLSA; PT $47
• Hims & Hers Health (HIMS) Rated New Buy at Seaport Global Securities
• LSE Group (LSEG LN) ADRs Rated New Buy at Berenberg; PT $34
• MacroGenics (MGNX) Rated New Buy at B Riley; PT $25
• Napco Security Technologies (NSSC) Rated New Buy at DA Davidson; PT $52
• NEXTracker (NXT) Rated New Buy at Baptista Research; PT $64.40
• Noble Corp. (NE) Rated New Buy at Baptista Research; PT $59.40
• PDD (PDD) ADRs Rated New Buy at Mirae Asset Daewoo; PT $175
• Qualys (QLYS) Rated New Sector Perform at Scotiabank; PT $172
• Rapid7 (RPD) Rated New Sector Perform at Scotiabank; PT $46
• Sika (SIKA SW) ADRs Rated New Buy at Berenberg; PT $31.38
• Spire (SR) Rated New Neutral at Ladenburg Thalmann; PT $57.50
• Swedbank (SWEDA SS) ADRs Rated New Buy at Berenberg; PT $22.20
• Tenable (TENB) Rated New Sector Perform at Scotiabank; PT $47
• TMX Group (X CN) Rated New Buy at Canaccord; PT C$44
• Valaris (VAL) Rated New Buy at Baptista Research; PT $95.50

Data sources: Bloomberg, Reuters, CQG