Futures Flat After FOMC Statement, Global Markets Mixed, Wage Inflation Eases In U.S.

The U.S. Futures Are Flat After The After The FOMC Statement

The U.S. futures are indicating a flat to a slightly negative open for the major indices on Thursday morning. The move follows a -0.75% decline in the S&P 500 on Wednesday sparked by Jerome Powell’s comments. FOMC Chief Powell says low inflation is transitory and the Fed stands ready to act when needed. This stance hints at no cuts to interest rates this year, a situation largely supported by the data.

Today’s data includes the weekly read on jobless claims and a key read on labor costs and productivity. On the jobless claims side of the equation, claims held steady over the last week. Continuing claims, those requesting the second week of assistance, rose slightly from a downwardly revised figure. Both figures have shown some volatility over the past few months but remain consistent with long-term economic health. Tomorrow’s NFP report will be closely watched. The market is expecting a strong 213,000 and that estimate may be low.

In earnings news, Under Armour reported before the bell and beat on the top and bottom line. The company is benefiting from strong labor trends and increased consumer spending shares advanced more than 5.0%. Shares of Dunkin Donuts were right behind with a gain near 5.0%. The iconic coffee and snack brand also reported better than expected revenue and earnings. Conversely, Tempur Sealy, a mattress maker, saw its shares fall -3.6% as competition and input costs weigh on results.

The EU Markets Are Mixed, Manufacturing Contracts For Another Month

The EU indices are flat and mixed at midday as Fed Chief Jerome Powell’s comments work their way through the market. Trading in the region was also affected by weaker than expected manufacturing data and the dovish tone in the BOE statement. On the economic front, all-EU Manufacturing PMI rose a tenth to 47.9, better than expected, but yet below 50 and firmly contractionary. The data is another indication the EU is suffering from protectionist policies and international trade relations.

The BOE, for its part, voted unanimously to hold rates steady at today’s meeting. The bank cited international risks related to trading conditions and the Brexit. With manufacturing in contraction and other signs of weakness, it is possible the BOE could lower rates sometime this year.

On the earnings front, shares of BNP Paribas jumped more than 1.0% after it released results. Shares of Dutch financial firm ING fell -1.5% after it reported a narrow miss.

Asian Equities Mixed, Japan Is Still Closed

Equities in Asia were mostly higher as markets return from a holiday. The Shanghai Composite, Hong Kong Hang Seng, and Korean Kospi all posted gains between 0.40% ad 0.85%. The Australian ASX was the only market to post a loss, -0.59%, but that is not surprising as it was the only market open on Wednesday. The Japanese market remains closed for the enthronement of their crown prince.