Five Things You Need to Know to Start Your Day
Five Things You Need to Know to Start Your Day
(Bloomberg) --
Reopening plans gather pace, a busy week for central banks, and a surprise from Deutsche Bank. Here are some of the things people in markets are talking about today.
Corner turned?
New York Governor Andrew Cuomo said a phased reopening beginning with construction and manufacturing could start as soon as May 15, as the state announced the lowest number of deaths in almost a month. Trade groups in the U.S. called for states to adopt uniform reopening standards. In Italy, Prime Minister Giuseppe Conte gave a timetable for restarting the economy which sees some activity resuming after May 4 with schools to remain closed until September. U.K. Prime Minister Boris Johnson, in his first address since returning to work after being hit with the virus, said the country was nearing the end of the “first phase” of the outbreak.
More buying
Both the U.S. Federal Reserve and the European Central Bank have scheduled monetary policy decisions this week, but it was the Bank of Japan that set the tone this morning announcing further purchases of corporate bonds and scrapping the limit on government bond buying. With both the Fed and the ECB announcing a lot of fresh stimulus since their last scheduled meetings, economists have limited expectations for further major announcements this week. The Fed decision is on Wednesday and the ECB is on Thursday, both followed by press conferences.
Good news, bad news
Deutsche Bank AG surprised the market by announcing net income of 66 million euros ($72 million), defying analyst expectations for a loss in the first quarter. The bank, which releases more detailed results on Wednesday, set aside about 500 million euros, three times last year’s amount, to cover loan losses that may arise from the coronavirus shutdown. Shares in the lender surged as much as 12% in Frankfurt trading. The bank stuck with its capital targets for 2022, calling the current effects from loan losses “temporary.”
Markets rally
Signs that an end may be in sight to the lockdown and more easing from the Bank of Japan has helped boost global equities. Overnight the MSCI Asia Pacific Index gained 1.9% while Japan’s Topix index closed 1.8% higher. In Europe, the Stoxx 600 Index had risen 1.7% by 5:50 a.m. Eastern Time with every industry sector in the green. S&P 500 futures pointed to a jump at the open and the 10-year Treasury yield was at 0.627%. Crude came under pressure again, with a barrel of West Texas Intermediate for June delivery dropping close to $14.
Coming up…
There’s more bad news expected for regional manufacturing when the Dallas Fed releases its April survey at 10:30 a.m. Speaking of regional moves, the state of Georgia will push ahead with its reopening plans, allowing movie theaters and restaurant dine-in services to resume business. The Federal Reserve will run liquidity operations totaling $1.5 trillion. Keurig Dr. Pepper Inc., Universal Health Services Inc., and Canadian National Railway Co. are among the companies reporting earnings.
What we've been reading
This is what's caught our eye over the weekend.
- Odd Lots: Adam Tooze on how this crisis is different than the last.
- The 20 minutes that broke the U.S. oil market.
- The next chapter of the oil crisis: The industry shuts down.
- Bank of China client losses said to climb to $1 billion on crude bets.
- Will a woman run North Korea? Kim’s sister outshines male rivals.
- Icahn says stocks are overvalued, virus may cause “downdrafts.”
- Happy birthday, Hubble.
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