What's moving markets today: April 17, 2019
Health care companies couldn't catch a break today and added on to their previous losses.
The industry-wide selloff came on the back of comments from UnitedHealth CEO David Wichmann saying "Medicare for all" proposals could "destabilize the nation's health system".
The monthly trade deficit fell by 3.4% to $49.4 billion in February, hitting its lowest level in eight months, according to data released Wednesday by the Census Bureau.
For the second month in a row, the trade deficit with China also narrowed as the United States continues to negotiate a trade deal with Beijing.
Exports to China increased by $1.6 billion and imports fell by $1.5 billion.
Last year, President Donald Trump imposed tariffs on $250 billion of Chinese goods, in an effort to pressure Beijing to come to the negotiating table, but saw the trade deficit climb as importers scrambled to stockpile goods ahead of further threatened tariffs.
US stocks started the session mixed. China's GDP report for the first quarter was better than expected but still failed to incite a rally in risk-sensitive assets like stocks.
BNY Mellon (BK) dropped 8% following first quarter earnings that failed to meet estimates before the bell.
I sound like a broken record. Here's why:
- US stocks feel resilient amid the crush of earnings and a summit to record highs appears inevitable.
- The Dow is fewer than 400 points away from a high, plodding forward with small, steady gains.
Individual stocks are the story, based on earnings results, but two recent macro comments from top CEOs stand out:
Certainly, there are bigger picture worries about President Trump’s criticism of the Fed and his choices for vacant positions on the Board of Governors.
Tensions are flaring between the US and the EU over Airbus and Boeing subsidies and the trade deal between the US and China is still not finished.
But for now, the path of least resistance, appears higher.
Buoyant economic data from China could have sent risk assets through the roof, but the market reaction has been a bit muddled.
All over, analysts are grappling with why 6.4% first quarter GDP growth -- more than expected and a rebound from the previous quarter -- didn’t lead to popping champagne corks.
Industrial production numbers were also strong at 8.5%, compared with some 6% expected, and retail sales beat expectations at 8.7% in March.
Still, “China’s imports have been falling recently, which suggests that domestic demand is weak, and that doesn’t tally up with industrial production and retail sales figures,” said David Madden, market analyst at CMC Markets.
This might give some investors pause. On top of that, the US-China trade conflict is still not resolved.
Asia stocks ended Wednesday’s session higher, with the Shanghai Composite (SHCOMP) rising 0.3%. US stock futures are pointing to a higher open. But on the whole, market participants appeared underwhelmed, especially given the fallout from weaker-than-expected Chinese data late last year.
In one asset, however, traders have taken the data at face value. Copper prices jumped on Wednesday and “broke above a short-term corrective trend", said Fawad Razaqzada, market analyst at Forex.com, and could climb further. Copper futures for July were up 1.3%
The grounding of American Airlines' Boeing 737 Max planes has forced the airline to cancel flights into mid-August. But the impact that has on its bottom line remains unclear.
The financial costs of this disruption cannot be forecasted at this time and will be dependent upon a number of factors, including the period of time the aircraft are unavailable and the circumstances of any reintroduction of the aircraft to service."
The stock is up nearly 2% in premarket trading.