Stock Market Update from Briefing.com

4:15 pm:

[BRIEFING.COM] The stock market finished Tuesday on a broadly higher note as equities rebounded alongside European bourses. The major averages drifted to the upside today as investors abandoned their risk-off posture, bidding oil, oversold currencies, and the heavily-weighted financial (+2.5%), technology (+2.0%), health care (+2.0%), and consumer discretionary (+1.9%) sectors. The Nasdaq Composite (+2.1%) ended its day ahead of the S&P 500 (+1.8%) and the Dow Jones Industrial Average (+1.6%).

The major U.S. averages began the day on a higher note as participants eyed a rebound in European equity markets. The Euro Stoxx 50 Index climbed 2.1%, rebounding from an 11.2% decline over the last two sessions. European banking names helped lead the gains as investors shifted their attention to a two-day EU Summit in Brussels. News flow from the Summit has been relatively light, but comments from German Chancellor Angela Merkel indicated that EU membership remains an all or nothing endeavor. Ms. Merkel said that Britain cannot simply pick and choose elements of membership.

Equities pulled back in the late morning, which corresponded to some late selling interest in the European market. The S&P 500 (+1.8%) found support near the 2020 price level, vacillating near that area until the final ninety minutes of trade. The major averages notched fresh session highs in the final hour of trade, finishing the day at their best levels. In front of the pack, commodity-sensitive energy (+2.6%) led heavily-weighted financials (+2.5%), technology (+2.0%), health care (+2.0%), and consumer discretionary (+1.9%). Conversely, countercyclical telecom services (+0.3%), utilities (+0.3%), and consumer staples (+0.6%) finished with the slimmest gains.

The energy sector (+2.6%) ended its day broadly higher, responding to a 3.1% ($47.92/bbl; +$1.44) gain in oil. In the group, Pioneer Natural Resources (PXD 149.71, +3.10) outperformed after updating its guidance. The company estimated that production growth will increase 12.0% through fiscal year 2016 while maintaining that its capital program is funded through 2018. The American Petroleum Institute will release its weekly inventory data this evening. 

In the financial sector (+2.5%), money center banks demonstrated relative strength as Bank of America (BAC 12.70, +0.52) and Citigroup (C 40.44, +1.96) gained 4.3% and 5.1%, respectively. On a side note, after the close on Wednesday, the Fed will release results from its Comprehensive Capital Analysis and Review (CCAR). Expectations remain high that most banks will be granted approval to increase their respective capital return programs. Separately, Dow component Travelers (TRV 114.13, +3.78) ended its day atop of the price-weighted index.

Biotechnology outperformed in the health care space (+2.0%), evidenced by the 3.8% rebound in the iShares Nasdaq Biotechnology ETF (IBB 250.66, +9.17). The sub-group traded higher alongside large caps Gilead Sciences (GILD 82.31, +4.06) and Allergan (AGN 227.72, +10.24). For the month, the ETF has lost 10.4%.

The PHLX Semiconductor Index (+2.7%) demonstrated relative strength, trimming its monthly loss to 4.8%. In the index, Skyworks (SWKS 60.26, +2.25) jumped 4.3% after Craig Hallum provided bullish commentary on the name. The firm maintained its "Buy" designation on the stock, citing industry-leading margins. In the broader technology space (+2.0%), Facebook (FB 112.70, +3.73) rallied 3.4%, erasing yesterday's loss.

The U.S. Dollar Index (95.96, -0.58) slipped today as the euro and the pound rebounded against the dollar. The euro/dollar pair ended higher by 0.6% (1.1089) while sterling jumped 1.0% (1.3354) against the buck. Conversely, the dollar gained 0.6% against the safe haven yen (102.64).

The Treasury complex finished modestly lower as the yield on the 10-yr note rose two basis points to 1.46%.

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

Today's economic data included the third estimate of first quarter GDP and GDP deflator, the Case-Schiller 20-city index for April, and Consumer Confidence for June: 

  • The third estimate for first quarter GDP showed output increasing at an annual rate of 1.1% (Briefing.com consensus 1.0%), up from the second estimate of 0.8% and the advance estimate of 0.5%.
    • The third estimate for first quarter GDP should not be regarded as the basis for any change in economic sentiment this morning for a number of reasons.
      • First, the report is very dated considering it is being released two days before the end of the second quarter.
      • Second, the report featured a downward revision to personal spending.
      • Third, it still points to a very weak period of growth in the first quarter.
      • And fourth, it is virtually meaningless for a market that is now consumed with what the third and fourth quarters will look like following the Brexit vote.
    • The upward revision in the third estimate was driven largely by exports increasing more than previously estimated.
    • That boosted the contribution from net exports to the change in GDP from -0.21 percentage points to 0.12 percentage points.
    • That negated the drag from the revised contribution level for personal spending from 1.29 percentage points to 1.02 percentage points.
    • Small upward revisions to government spending, the change in private inventories, and fixed investment helped account for the remaining difference.
    • Final sales of domestic product, which exclude the change in inventories, increased from 1.0% to 1.3% with the third estimate.
  • The Case-Shiller 20-city Home Price Index for April rose to 5.4%, which was below the Briefing.com consensus of 5.5%. This followed the previous month's revised reading of 5.5% (from 5.4%).
  • The Conference Board's Consumer Confidence Index increased to 98.0 in June from a downwardly revised 92.4 (from 92.6) in May.
    • The June reading was well ahead of the Briefing.com consensus estimate, which was pegged at 93.1, and is the highest level for the index since last September.
    • The uptick in June was driven by an improvement in both the Present Situation Index, which increased from 113.2 to 118.3, and the Expectations Index, which rose from 78.5 to 84.5.
    • The Conference Board noted that expectations regarding business and labor market conditions, as well as personal income prospects, improved moderately.
    • This report offers a nice headline surprise, although its relevance is diminished considering the survey was mailed and responses were collected prior to the Brexit vote and its aftermath.
    • The latter consideration will lend more relevance to the consumer confidence reading for July.

Tomorrow's economic data will include the 7:00 ET release of the weekly MBA Mortgage Index. Meanwhile, Personal Income (Briefing.com consensus 0.3%), Personal Spending (Briefing.com consensus 0.3%), and Core PCE Prices (Briefing.com consensus 0.2%) for May will cross the wires at 8:30 ET. Finally, the day's data will be capped off with Pending Home Sales for May (Briefing.com consensus -1.4%), which will be released at 10:00 ET. 

  • Nasdaq Composite -6.3% YTD
  • Russell 2000 -2.6% YTD
  • S&P 500 -0.4% YTD
  • Dow Jones -0.1% YTD

3:30 pm: [BRIEFING.COM]

  • The dollar index holds onto its morning losses, down -0.3% around the 96.25 level, boosting commodities
    • Commodities, as measured by the Bloomberg Commodity Index, are up +1.9% at 88.30
  • Crude oil sees an early afternoon reversal and closes near its high of the day as dollar momentum wanes
    • August crude oil futures rose $1.44 (+3.1%) to $47.92/barrel
    • API data is scheduled to be released today at 4 pm ET
    • EIA petroleum inventory data is scheduled to be released tomorrow at 10:30 am ET
    • Monthly IEA data is scheduled to be released on July 13th
    • The Baker Hughes rig count will be released this Friday at 1 pm ET
  • Natural gas surges to fresh highs of 2016 after reports surface over an Enterprise Products natural gas plant explosion in Mississippi
    • August natural gas closed $0.15 higher (+5.5%) at $2.89/MMBtu
    • EIA natural gas inventory data is scheduled to be released at 10:30 am ET
  • In precious metals, gold sees an afternoon of consolidation, snapping its 2-session streak of gains to close lower
    • August gold ended today's session down $6.80 (-0.5%) to $1317.80/oz
  • Silver trades sideways in afternoon trade, inching higher into the close as the dollar weakens
    • July silver closed today's session $0.08 higher (+0.5%) at $17.83/oz
  • Base metal copper rallies to close notably higher, recovering its initial pre-Brexit gains
    • September copper closed $0.05 higher (+2.4%) at $2.17/lb
    • Copper futures have changed their front month to September from July, as indicated by the active amount of volume in the contracts.

3:00 pm:

[BRIEFING.COM] The major averages have rallied to fresh session highs as the Nasdaq Composite (+2.0%) and the S&P 500 (+1.6%) lead the Dow Jones Industrial Average (+1.3%).

All ten sectors trade in positive territory with energy (+2.4%) and financials (+2.1%) leading the way, followed by heavily-weighted technology (+1.8%) and health care (+1.7%). On the flipside countercyclical utilities (+0.2%) and consumer staples (+0.3%) sport the slimmest gains.

In the health care space (+1.7%), the biotechnology sub-group trades at a fresh session high as Gilead Sciences (GILD 81.91, +3.68) climbs 4.7%. Separately, fellow large cap Vertex Pharmaceuticals (VRTX 83.15, +3.31) has gained 4.2%.

The materials space (+0.4%) trades behind the broader market as weakness in Dow Chemical (DOW 47.95, -1.56) and DuPont (DD 61.71, -2.37) weigh on the sector. The two names were downgraded to "Neutral" from "Outperform" at JPMorgan. Elsewhere, Monsanto (MON 100.69, +0.73) has gained 0.8% ahead of tomorrow morning's earnings report.

On the commodities front, WTI crude ended its pit session higher by 3.1% ($47.92/bbl; +$1.44).

2:30 pm:

[BRIEFING.COM] The S&P 500 (+1.0%) has slipped lower in recent action, testing technical support at the 2020 price level. Elsewhere, the more domestically-oriented Russell 2000 (+1.3%) outperforms.

The commodity-sensitive energy sector (+1.8%) displays relative strength, responding to a 3.4% ($47.92/bbl +$1.59) gain in crude oil. In the space, refining name Marathon Petroleum (MPC 34.83, +1.90) has climbed 5.8%. Elsewhere, independent oil and gas names outperform as Pioneer Natural Resources (PXD 150.37, +3.76) trades higher by 2.5%. The oil producer updated its guidance today, estimating that production growth will increase 12.0% for fiscal year 2016. Furthermore, Pioneer Natural Resources projected that its capital program is funded through 2018.

Investors will receive the latest stockpile report from the American Petroleum Institute this evening while tomorrow's more influential inventory data from the Department of Energy will cross the wires at 10:30 ET.

The CBOE Volatility Index (20.07, -3.78) has fallen 15.9%, extending its weekly decline to 22.1%. However, the volatility barometer remains near the 20.0% level, indicating heightened expectations for volatility in the short-term.

2:00 pm:

[BRIEFING.COM] The major indices have ticked higher since our last update as the S&P 500 (+1.0%) trades six points off its best level of the day. Separately, the Nasdaq Composite (+1.5%) continues to outperform amid strength in technology and biotechnology.

The consumer staples sector (-0.1%) displays relative weakness as investors adopt a risk-on approach following a two-day selloff in the broader market. In the group, food names underperform as Tyson Foods (TSN 63.71, -1.52) and Hormel Foods (HRL 34.76, -1.05) lose 2.4% and 2.9%, respectively. Elsewhere, Campbell Soup (CPB 62.32, -1.25) has fallen 2.0% while General Mills (GIS 65.37, -0.82) has slipped 1.2% ahead of tomorrow morning's earnings report.

Safe haven utilities (UNCH) and telecom services (+0.2%) have also been under pressure, trading behind the broader market. However, despite today's weakness the two currently top the monthly leaderboard, having climbed 4.5% and 6.5%, respectively.

On the commodities front, gold ended its day lower by 0.5% ($1,317.80/ozt; -$6.80), but remains higher by 4.1% for the month of June.

1:35 pm:

[BRIEFING.COM] The major U.S. indices continue to sport solid gains in afternoon trading despite some recent selling pressure as stocks bounce back following a two-day BREXIT selloff. 

A look inside the Dow Jones Industrial Average shows that Travelers (TRV 113.17, +2.82), Visa (V 74.87, +1.53), and General Electric (GE 29.87, +0.55) are outperforming. Travelers is leading the Dow after being upgraded to Buy from Neutral at BofA/Merrill, with Visa shortly behind after being upgraded to Overweight from Neutral at Atlantic Equities. GE is higher after announcing it had entered into agreements for the sale of the bulk of GE Capital's U.S. restaurant franchise financing assets. The combined transactions represent ending net investment of ~$1.4 bln and with the sale, GE Capital's announced sales now total $180 bln since April 2015. 

Conversely, DuPont (DD 61.82, -2.26) is the worst-performing Dow component after being downgraded to Neutral from Overweight at JP Morgan

With today's gains, the DJIA has trimmed its June losses to 2.9%

1:10 pm:

[BRIEFING.COM] The stock market trades on a higher note at midday as the major averages rebound following two days of substantial selling pressure. The rebound itself lacks a specific catalyst, but short-term oversold conditions have been a significant contributing factor. The increased risk appetite has been underscored by softening in the dollar and the outperformance of heavily-weighted health care (+1.5%), technology (+1.4%), financials (+1.4%), and consumer discretionary (+1.3%). The Nasdaq Composite (+1.5%) trades ahead of the S&P 500 (+1.1%) and the Dow Jones Industrial Average (+0.9%).

Futures rallied overnight, lifted by a rebound in European regional indices. European bourses have been under substantial pressure recently as investors ruminate over the potential implications of the United Kingdom's exit from the European Union. The Euro Stoxx 50 index (+2.1%) tumbled 11.2% in the prior two sessions while the pound/dollar pair plunged 11.1% over that same time. Investors are eyeing developments from a two-day EU Summit in Brussels, looking for clues to the timing and terms of the official breakup.

The major averages gapped up at the beginning of the session, carving out highs in the opening half hour. However, the indices drifted lower off their opening levels as U.S. equities pulled back alongside European bourses. The benchmark index (+1.1%) recently found support near the 2020 price level. At midday, nine sectors trade in the green with energy (+1.8%), health care (+1.5%), and consumer technology (+1.4%) leading the pack. On the flipside, the materials sector (-0.1%) is the lone decliner.

Biotechnology demonstrates relative strength, evidenced by the 2.9% rebound in the iShares Nasdaq Biotechnology ETF (IBB 248.53, +7.04). The sub-group has been under pressure in June, showing a loss of 11.2% over that time. In the group, Gilead Sciences (GILD 81.10, +2.85) outperforms after the FDA approved the company's new Hepatitis-C medication. Elsewhere, Allergan (AGN 223.75, +6.27) has jumped 2.9% after Mayne Pharmaceuticals agreed to acquire 37 FDA-approved and five FDA-filed products from Allergan and Teva Pharmaceuticals (TEVA 49.48, +0.95).

The economically-sensitive financial sector (+1.4%) demonstrates broad-based strength as the group moves higher in sympathy with European banking names. On that note, Royal Bank of Scotland (RBS 4.79, +0.10) and Lloyds Banking (LYG 3.08, 0.30) have climbed 2.3% and 11.0%, respectively. In the sector, Dow component Travelers (TRV 113.16, +2.81) leads the price-weighted index. The name has benefited from an upgrade to "Buy" from "Neutral" at Bank of America/Merrill Lynch. 

The high-beta chipmakers outperform, evidenced by the 1.9% gain in the PHLX Semiconductor Index. The growth-sensitive group has been under pressure in the month of June, showing a loss of 5.6% this month. In the group, Skyworks (SWKS 59.63, +1.62) and Broadcom (AVGO 148.13, +4.50) outperform, gaining 2.8% and 3.1%, respectively.

The U.S. Dollar Index (96.22, -0.33) has slipped in recent action as the pound extends its rebound against the greenback. Sterling has climbed 0.9% against the buck (1.3346), ticking off the 1.3270 level in recent trade. Elsewhere, the dollar has lost ground to the Canadian dollar as oil extends its gain. The energy component has climbed 2.2% ($47.37/bbl; +$1.04) so far today.

The Treasury complex trades on a mixed note as the yield on the 10-yr note rises three basis points to 1.46%.

Today's economic data included the third estimate of first quarter GDP and GDP deflator, the Case-Schiller 20-city index for April, and Consumer Confidence for June: 

  • The third estimate for first quarter GDP showed output increasing at an annual rate of 1.1% (Briefing.com consensus 1.0%), up from the second estimate of 0.8% and the advance estimate of 0.5%.
    • The third estimate for first quarter GDP should not be regarded as the basis for any change in economic sentiment this morning for a number of reasons.
      • First, the report is very dated considering it is being released two days before the end of the second quarter.
      • Second, the report featured a downward revision to personal spending.
      • Third, it still points to a very weak period of growth in the first quarter.
      • And fourth, it is virtually meaningless for a market that is now consumed with what the third and fourth quarters will look like following the Brexit vote.
    • The upward revision in the third estimate was driven largely by exports increasing more than previously estimated.
    • That boosted the contribution from net exports to the change in GDP from -0.21 percentage points to 0.12 percentage points.
    • That negated the drag from the revised contribution level for personal spending from 1.29 percentage points to 1.02 percentage points.
    • Small upward revisions to government spending, the change in private inventories, and fixed investment helped account for the remaining difference.
    • Final sales of domestic product, which exclude the change in inventories, increased from 1.0% to 1.3% with the third estimate.
  • The Case-Shiller 20-city Home Price Index for April rose to 5.4%, which was below the Briefing.com consensus of 5.5%. This followed the previous month's revised reading of 5.5% (from 5.4%).
  • The Conference Board's Consumer Confidence Index increased to 98.0 in June from a downwardly revised 92.4 (from 92.6) in May.
    • The June reading was well ahead of the Briefing.com consensus estimate, which was pegged at 93.1, and is the highest level for the index since last September.
    • The uptick in June was driven by an improvement in both the Present Situation Index, which increased from 113.2 to 118.3, and the Expectations Index, which rose from 78.5 to 84.5.
    • The Conference Board noted that expectations regarding business and labor market conditions, as well as personal income prospects, improved moderately.
    • This report offers a nice headline surprise, although its relevance is diminished considering the survey was mailed and responses were collected prior to the Brexit vote and its aftermath.
    • The latter consideration will lend more relevance to the consumer confidence reading for July.

12:30 pm:

[BRIEFING.COM] The S&P 500 (+1.0%) has inched lower in recent trade, testing support near the 2020 price level.

In front of the pack, energy (+1.6%) leads heavily-weighted health care (+1.4%), technology (+1.2%), consumer discretionary (+1.2%) and financials (+1.1%).

In the consumer discretionary space (+1.2%), Carnival (CCL 43.34, -0.29) surrendered a 5.8% gain as investors weigh in-line results for the quarter against mixed guidance. The cruise ship operator sports a loss of 9.2% since the end of May, compared to a decline of 4.3% in the broader sector over that period.

Retail names trade in-line with the broader market as the SPDR S&P Retail ETF (XRT 40.56, +0.42) gains 1.0%. In the group, Dow component Nike (NKE 52.40, +0.51) has rebounded 1.0% ahead of this evening's earnings report. Elsewhere, office retailer Staples (SPLS 8.42, +0.35) outperforms, jumping 4.3%.

The Treasury complex trades on a mixed note as the yield on the 10-yr note rises three basis points to 1.46%. Separately, the yield on the 30-yr bond is unchanged (2.27%) after falling 28 basis points from Thursday's pre-Brexit settlement (2.55%).

12:00 pm:

[BRIEFING.COM] The major averages have drifted higher in recent action as the Nasdaq Composite (+1.6%) trades ahead of the S&P 500 (+1.1%) and the Dow Jones Industrial Average (+0.9%).

In the technology space (+1.3%), the high-beta chipmakers demonstrate relative strength, evidenced by the 1.9% gain in the PHLX Semiconductor Index. The semi Index has trimmed its monthly loss to 5.6%, which compares to a decline of 3.6% in the benchmark index over that time. In the group, Skyworks (SWKS 59.76, +1.75) has climbed 3.0% after receiving a bullish note at Craig Hallum.

In the broader technology space (+1.3%), data storage names outperform as Western Digital (WDC 43.20, +1.02) and Seagate Technology (STX 221.95, +1.08) trade higher by 2.4% and 5.2%, respectively. Elsewhere, large cap component Facebook (FB 112.18, +3.22) has gained 3.0%, erasing yesterday's loss to trade higher by 0.1% for the week.

The U.S. Dollar Index (96.31, -0.23) trades near its session high as the pound continues to trim its gain against the buck. Cable trades higher by 0.4% (1.3277) after sliding from the 1.3410 level at the beginning of the session.

11:35 am:

[BRIEFING.COM] The S&P 500 (+0.9%) has slipped lower since the last update, losing its footing near the 2020 price level. The benchmark index cleared that resistance level in the opening gap up, but has been unable to maintain positioning above that level ahead of the European close.

The countercyclical health care space (+1.4%) has climbed up the leaderboard, bolstered by a rebound in the biotechnology sub-group. The group has been under pressure in the month of June with the iShares Nasdaq Biotechnology ETF (IBB 247.90, +6.40) losing 11.4% this month. In the group, Gilead Sciences (GILD 80.94, +2.69) has gained 3.4% after the FDA approved the company's new Hepatitis C medication.

In the broader sector, Humana (HUM 181.79, +5.14) has gained 2.9% after the company and its proposed merger partner, Aetna (AET 118.08, +2.52), notified investors that the deadline to complete a proposed merger between the two will be extended to December 31, 2016 from June 30, 2016.

On the commodities front, WTI crude trades higher by 1.6% ($47.08/bbl; +$0.75) after moving off its overnight high of $47.80/bbl. Separately, gold trades lower by 0.6% ($1,316.90/ozt, -$7.80).

11:00 am:

[BRIEFING.COM] The major averages have pulled back in recent action as the S&P 500 (+1.0%) trades seven points off its best level of the day. The pullback in U.S. equities corresponded with a similar move in European bourses.

The economically-sensitive financial sector (+1.2%) has trimmed its gain alongside the broader market, responding to price action in European banking names. Deutsche Bank (DB 14.11, +0.24) and Royal Bank of Scotland (RBS 4.78, +0.09) trade higher by 1.7% and 2.1%, respectively. However, the names were up a respective 4.3% and 6.4% earlier in the session. On the home front, Dow component Travelers (TRV 112.72, +2.37) tops the price-weighted index after receiving an upgrade at Bank of America/Merrill Lynch. The firm cited the company's limited exposure to the U.K. and a robust domestic business as reasons for the upgrade.

The U.S. Dollar Index (96.30, -0.24) has inched higher with the pound trimming its gain as European equity markets enter the home stretch. Sterling has gained 0.7% against the buck (1.3327) after ticking off the 1.3413 price level earlier in the session. Elsewhere, the dollar has gained 0.8% against the safe haven yen (102.79).

10:30 am: [BRIEFING.COM]

  • The dollar index takes a breather from its 2-day monster rally, down -0.4% around the 96.14 level, boosting commodities overall
    • Commodities, as measured by the Bloomberg Commodity Index, are up +1.6% at 88.03
  • Crude oil rallies to fresh highs of the day as the dollar loses momentum, erasing all of the previous session's losses ahead of today's API data
    • July crude oil futures are currently up $1.19 (+2.6%) at $47.50/barrel
    • API data is scheduled to be released today at 4 pm ET
    • EIA petroleum inventory data is scheduled to be released tomorrow at 10:30 am ET
    • Monthly IEA data is scheduled to be released on July 13th
  • Natural gas extends yesterday's rally as headlines of a natural gas plant explosion in Mississippi late last night weigh on the minds of traders/investors
    • July natural gas futures are currently up $0.09 (+3.1%) at $2.83/MMBtu
    • EIA data is scheduled to be released on Thursday at 10:30 am ET
  • In precious metals, gold sees a steep morning drop despite dollar weakness as Brexit fears subside and equities stage a recovery
    • August gold futures are currently down $10.00 (-0.8%) at $1314.60/oz
  • Silver trades near parity with the previous session's close, currently drifting lower for the day
    • July silver futures are currently down $0.03 (+0.2%) at $17.78/oz
  • Base metal copper rallies in morning pit trading as panic over the results of the UK referendum subside
    • July copper futures are currently up $0.05 (+2.3%) at $2.17/lb

10:00 am:

[BRIEFING.COM] The major averages have ticked higher in recent action as the Nasdaq Composite (+1.7%) trades ahead of the S&P 500 (+1.3%).

Just released, the Consumer Confidence reading for June came in at 98.0 while economists polled by Briefing.com expected the survey to hit 93.1. This followed the prior month's revised reading of 92.4 (from 92.6).

The leaderboard remains little changed with energy (+2.0%) leading heavily-weighted consumer discretionary (+1.6%), technology (+1.6%), and financials (+1.5%). Meanwhile, countercyclical utilities (-0.3%) sport the only loss while telecom services (+0.2%) and consumer staples (+0.3%) also round out the board.

The U.S. Dollar Index (96.06, -0.49) has floated lower in recent action as commodity-currencies extend their lead over the buck. The dollar/Canadian dollar pair trades lower by 0.2% (1.3048), slipping from the 1.3060 level recently. Separately, the pound has gained 1.2% against the greenback (1.3384) while the dollar/yen pair trades higher by 0.5% (102.49).

9:45 am:

[BRIEFING.COM] As expected, the stock market began its day on a higher note with the Nasdaq Composite (+1.4%) leading the S&P 500 (+1.1%) and the Dow Jones Industrial Average (+1.1%).

Nine sectors trade in the green with energy (+1.9%) and consumer discretionary (+1.5%) leading the advance. The remaining cyclical sectors sport upticks between 1.0% (materials) and 1.4% (technology). On the flipside, utilities (UNCH) trade in the red. 

The Dow Jones Transportation Average (+1.3%) demonstrates relative strength as airline names outperform. In the group, American Airlines (AAL 25.92, +0.66) has gained 2.7% while the broader U.S. Global Jets ETF (JETS 20.21, +0.36) climbs 1.7%.

In the consumer discretionary space (+1.6%), travel, tourism, and leisure names all outperform. On that note, Priceline (PCLN 1230.55, +44.50) has rebounded 3.7%. Elsewhere, Carnival (CCL 45.51, +1.87) has jumped 4.3% after reporting a bottom-line beat on in-line revenue for the second quarter. 

On the commodities front, WTI crude trades higher by 3.0% ($47.69/ozt; +$1.36) while gold has slipped 0.4% ($1,319.70/ozt; -$5.00). 

9:21 am: [BRIEFING.COM] S&P futures vs fair value: +17.80. Nasdaq futures vs fair value: +40.10.

The stock market is on track for a higher open as the S&P 500 futures trade 18 points above fair value.

U.S. equity futures rebounded alongside European bourses overnight, recovering from recent heavy selling pressure. The rebound follows two days of selling that has reportedly cost global markets $3 trillion in market capitalization and was highlighted by an 11.2% decline in the Euro Stoxx 50 index. Financial names have helped lead the advance in Europe as Barclays (BCS 7.21, +0.18) and Royal Bank of Scotland (RBS 4.91, +0.22) jump 2.6% and 4.7%, respectively.

Today also marks the beginning of a two-day EU Summit in Brussels. The U.K.'s recent decision to leave the group will likely be in focus, but German Chancellor Angela Merkel said formal and informal talks with the U.K. will begin after the country invokes Article 50 of the Lisbon Treaty. Chancellor Merkel struck a cautious tone regarding the exit, stating that negotiations will not be a cherry-picking exercise for the U.K.

In company specific news, Dow Chemical (DOW 50.42, +0.45) has gained 0.9% after announcing that cost synergies in its Dow Corning transaction would total $400 million instead of the previously stated $300 million target. The chemical giant also announced that it would be reducing its workforce by 2,500. Dick's Sporting Goods (DKS 41.20, +1.13) has gained 2.8% after Goldman added the stock to its Conviction Buy List. Finally, ReachLocal (RLOC 4.54, +2.85) has surged 168.8% after Gannett (GCI 13.62, +0.00) announced that it would acquire the company for $4.60 per share or approximately $156 million.

The U.S. Dollar Index (96.10, -0.44) trades lower as the euro and pound rebound against the greenback. The single currency has gained 0.3% against the dollar (1.1058) while sterling has rebounded 1.0% against the buck (1.3363). The downtick has helped dollar-denominated commodities as oil trades higher by 2.5% ($47.49/bbl; +$1.18).

Today's economic data will be capped off with Consumer Confidence for June (Briefing.com consensus 93.1) crossing the wires at 10:00 ET.

9:02 am: [BRIEFING.COM] S&P futures vs fair value: +19.00. Nasdaq futures vs fair value: +40.80.

The S&P 500 futures trade 19 points above fair value.

Just released, the Case-Shiller 20-city Home Price Index for April rose to 5.4%, which was below the Briefing.com consensus of 5.5%. This followed the previous month's revised reading of 5.5% (from 5.4%).

8:56 am: [BRIEFING.COM] S&P futures vs fair value: +19.30. Nasdaq futures vs fair value: +40.60.

The S&P 500 futures trade 19 points above fair value. 

Equity indices in the Asia-Pacific region ended Tuesday on a mixed note, but there were some signs of increased risk tolerance as the pound rebounded while the yen retreated against the dollar. Government officials in Japan reiterated that they stand ready to step into the foreign exchange market if persistent yen strength becomes cumbersome.

  • Economic data was limited:
    • South Korea's June Consumer Confidence held at 99

---Equity Markets---

  • Japan's Nikkei ticked up 0.1%. Five sectors registered gains with consumer staples (+0.9%), health care (+0.7%), and communications (+0.6%) showing relative strength while energy (-3.4%) and financials (-1.1%) lagged. Sharp, Nippon Meat Packers, DeNa, Kirin Holdings, Eisai, Kikkoman, and Fanuc gained between 1.5% and 9.0%. On the downside, Toyota Motor, Mazda Motor, Yamaha, Canon, and Fujitsu lost between 2.5% and 3.4%.
  • Hong Kong's Hang Seng shed 0.3% with more than half of its components ending in the red. Gaming names and financials struggled with Galaxy Entertainment, Sands China, Bank of China, Bank of East Asia, and HSBC falling between 0.6% and 2.2%. Li & Fung outperformed, climbing 6.6%.
  • China's Shanghai Composite rose 0.6% with Liaoning SG Automotive, Pacific Securities, Founder Securities, and CITIC Securities climbing between 1.2% and 2.1%.

Major European indices trade higher across the board with Italy's MIB (+4.4%) pacing the region-wide rebound. For its part, the euro has climbed 0.4% against the dollar to 1.1073 while the pound has advanced 1.3% to 1.3400. European Central Bank President Mario Draghi argued for a global "alignment of policies" in order to better mitigate risks that could arise from current monetary measures, which likely emboldened investors. Elsewhere, German Chancellor Angela Merkel said formal and informal talks with the U.K. will begin after the country invokes Article 50 of the Lisbon Treaty. Chancellor Merkel's message was consistent with that conveyed by French President Francois Hollande and Italian Prime Minister Matteo Renzi.

  • In economic data:
    • Germany's May Import Price Index +0.9% month-over-month (expected 0.6%; last -0.1%); -5.5% year-over-year (consensus -5.8%; last -6.6%)
    • UK's June CBI Distributive Trades Survey slipped to 4 from 7 (expected -2)
    • France's Consumer Confidence ticked down to 97 from 98, as expected
    • Spain's May Retail Sales +2.3% year-over-year (consensus 3.6%; last 4.0%)
    • Italy's June Business Confidence ticked up to 102.8 from 102.1 (expected 101.9) while June Consumer Confidence slipped to 110.2 from 112.5 (consensus 112.5)

---Equity Markets---

  • Germany's DAX is higher by 3.0% amid broad strength. RWE has spiked 6.0% while exporters Volkswagen, BMW, and Daimler are up between 1.1% and 2.6%. Financials Deutsche Bank and Allianz are up 2.3% and 3.3%, respectively.
  • UK's FTSE has climbed 3.0% with financials and consumer names among the leaders. Prudential, Aberdeen Asset Management, Lloyds Banking, Old Mutual, and Barclays are up between 3.4% and 10.4% while homebuilders Barratt Developments and Taylor Wimpey hold respective gains of 4.7% and 4.1%.
  • France's CAC has rallied 3.3% with financials BNP Paribas, AXA, Credit Agricole, and Societe Generale in the lead. The four names are up between 3.2% and 5.3%. Consumer names like Accor, Louis Vuitton, and L'Oreal have added between 2.6% and 4.3%.
  • Italy's MIB has surged 4.4% with Mediobanca, UBI Banca, Banca di Milano Scarl, Intesa Sanpaolo, and Unicredit up between 3.2% and 7.7%.

8:34 am: [BRIEFING.COM] S&P futures vs fair value: +16.50. Nasdaq futures vs fair value: +34.00.

Equity futures have pulled back from their best levels of the morning as the S&P 500 futures trade 17 points above fair value. 

The third revision to first quarter GDP was released this morning and it was revised higher than expectations and the prior estimate. First quarter GDP was revised to 1.1% from 0.8% while the Briefing.com consensus called for a revision to 1.0%. Separately, the first quarter GDP Deflator was revised lower to 0.4% while the Briefing.com consensus expected the reading to come in unchanged at 0.6%. 

8:08 am: [BRIEFING.COM] S&P futures vs fair value: +13.50. Nasdaq futures vs fair value: +29.80.

U.S. equity futures trade higher with the S&P 500 futures floating 14 points above fair value. Futures moved higher in tandem with global bourses overnight as equity markets looked to rebound from heavy losses over the past two sessions. European indices lead the rebound with regional markets trading higher by more than 2.0% apiece. Additionally, the euro and the pound are making up some ground against the dollar with the euro/dollar pair gaining 0.4% (1.1067). Meanwhile, the pound has jumped 0.9% against the greenback (1.3348). Separately, today marks the beginning of a two-day EU Summit in Brussels.

The Treasury complex trades on a lower note with the yield on the 10-yr note rising four basis points to 1.47%.

On the economic front, data will include the third estimate of first quarter GDP (Briefing.com consensus 1.0%) and the third estimate for the first quarter GDP deflator (Briefing.com consensus 0.6%), which will both be released at 8:30 ET. Separately, the Case-Schiller 20-city index for April (Briefing.com consensus 5.5%) and Consumer Confidence for June (Briefing.com consensus 93.1) will cross the wires at 9:00 ET and 10:00 ET, respectively.

In U.S. corporate news of note:

  • Blue Buffalo (BUFF 22.66, -0.72): -3.1% after commencing a secondary offering of 15 million shares on behalf of selling shareholders
  • Skyworks (SWKS 59.60, +1.59): +2.7% following the stock receiving a bullish note at Craig Hallum, citing positive operating margins for the industry
  • CIGNA (CI 123.97, +1.88): +1.5% after the stock was initiated at Stifel with a "Buy" designation and a price target of $169

Reviewing overnight developments:

  • Asia-Pacific indices ended Tuesday mixed with China's Shanghai Composite +0.6%, Japan's Nikkei +0.1%, and Hong Kong's Hang Seng -0.3%.
    • Economic data was limited:
      • South Korea's June Consumer Confidence held at 99
    • In news:
      • Signs of increased risk tolerance as the pound rebounded while the yen retreated against the dollar.
      • Government officials in Japan reiterated that they stand ready to step into the foreign exchange market if persistent yen strength becomes cumbersome.
  • European indices trade higher with France's CAC +2.7%, the U.K.'s FTSE +2.5%, and Germany's DAX +2.2%. Elsewhere, Italy's MIB (+3.8%) leads the advance.
    • In economic data:
      • Germany's May Import Price Index +0.9% month-over-month (expected 0.6%; last -0.1%); -5.5% year-over-year (consensus -5.8%; last -6.6%)
      • UK's June CBI Distributive Trades Survey slipped to 4 from 7 (expected -2)
      • France's Consumer Confidence ticked down to 97 from 98, as expected
      • Spain's May Retail Sales +2.3% year-over-year (consensus 3.6%; last 4.0%)
      • Italy's June Business Confidence ticked up to 102.8 from 102.1 (expected 101.9) while June Consumer Confidence slipped to 110.2 from 112.5 (consensus 112.5)
    • In news: 
      • European Central Bank President Mario Draghi argued for a global "alignment of policies" in order to better mitigate risks that could arise from current monetary measures.
      • German Chancellor Angela Merkel said formal and informal talks with the U.K. will begin after the country invokes Article 50 of the Lisbon Treaty.
      • Chancellor Merkel's message was consistent with that conveyed by French President Francois Hollande and Italian Prime Minister Matteo Renzi.
      • For its part, the euro has climbed 0.4% against the dollar to 1.1067 while the pound has advanced 0.9% to 1.3348.

5:55 am: [BRIEFING.COM] S&P futures vs fair value: +16.40. Nasdaq futures vs fair value: +35.40.

5:55 am: [BRIEFING.COM] Nikkei...15323...+13.90...+0.10%.  Hang Seng...20172...-54.80...-0.30%.

5:55 am: [BRIEFING.COM] FTSE...6121.1...+138.90...+2.30%.  DAX...9470.65...+202.00...+2.20%.

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