Economic Data Deluge

A busy day greets us this morning, with major economic news hitting the tape ahead of the normal trading session, during it and afterwards, as well. Pre-market futures are mixed-to-flat once again, this time with the blue-chip Dow leading into positive territory. Bond yields have trended low but look fairly stable around 4.23% on the 10-year and 3.71% on the 2-year at this hour.

Advance Trade Balance Sinks to All-Time Depth

The March report for Advance Trade Balance on Goods came out this morning, hitting an all-time high (low?) of -$162 billion, from an adjusted -$147.8 billion the prior month. These numbers have fallen off a table since the latest presidential election back in November of last year, with only February’s slight respite keeping these numbers from moving downward (upward?) each month since then. This survey has been in existence since January of 1989.

Advance Retail Inventories swung from +0.1% expected to -0.1% for the March report. Expectations were for growth of +0.4%, so today’s headline is much worse than expected. Since July of last year, when Retail Inventories registered +1.0%, these figures have been moving downward. The previous month’s +0.1% was also lowered to -0.1% in this morning’s revision.

Advance Wholesale Inventories came in at +0.5%, slightly below the +0.6% consensus estimate. This matches the upwardly revised February print, which rose 20 basis points (bps). January of this year still holds the near-term high +0.8%. We might expect trade balances to enter a new phase beginning a month from now, when April results reflect tariff trade policies.

Q1 Earnings at a Glance: PYPL, PFE, GM & More

PayPal PYPL posted mixed results in its Q1 report out ahead of today’s open, with a +15.65% earnings beat: $1.33 per share versus $1.15 expected. However, revenues of $7.79 billion in the quarter missed expectations by a scant -0.23%. Shares are up +1% at this hour, but still down more than -20% year to date.

Big Pharma staple Pfizer PFE has similar results in its Q1 report this morning, posting a strong +43.75% beat on its bottom line, with earnings of 92 cents per share outpacing the 64 cents analysts were expecting. Revenues were -0.88% lower than projected to $13.72 billion in the quarter. Shares are flat ahead of today’s opening, but still down -13% year to date.

General Motors GM struck Q1 beats on both top and bottom lines this morning, with earnings of $2.78 per share surpassing the $2.69 estimate for a +3.35% beat, on revenues of $44.02 billion which outpaced expectations by +3.57%. Tariff headwinds are marring guidance; shares are down -2.5% in today’s pre-market, -11.3% year to date.

Honeywell HON was also strong in today’s Q1 report, bettering estimates by +13.57% on the bottom line — earnings of $2.51 per share versus $2.21 anticipated — on $9.82 billion in quarterly sales, which amounted to a +2.59% beat. Strength in military drones is helping move the needle for the industrial conglomerate, and shares are up nearly +4% ahead of the open. For more on HON’s earnings, click here.

Spotify SPOT, however, missed on Q1 earnings this morning by more than -50%: earnings of $1.13 per share disappointed from the $2.29 in the Zacks consensus. Revenues of $4.41 billion missed estimates by -4.08%. User guidance has also fallen from previous estimates, and shares have shed -7% at this hour in pre-market activity.

What to Expect from the Stock Market Today

After today’s open, we’ll get the latest Job Openings and Labor Turnover Survey (JOLTS) results, which are a month in arrears from the other employment data during Jobs Week. Expectations are for this headline number to drift down from last month’s 7.57 million to roughly 7.5 million. We’ve seen some volatility in these figures over the past year or so, but ultimately have been range-bound beneath the 8+ million level as of March of ’24. In March 2022, we saw an all-time high 12.1 million job openings.

Consumer Confidence for April is also expected to come out around the same time this morning, and anticipated to come down even further: 87.3 from 92.9 reported for March. Just earlier this year we were solidly above 100 on this metric, and pretty consistently above triple figures for almost all of the past four years. An unclear economic future and continued high prices are weighing on the American consumer.

Earnings reports after today’s close will include important companies like Visa V, Starbucks SBUX, Seagate Technologies STX and Snap SNAP. But the big “Mag 7” reports don’t begin this week until Wednesday afternoon, when Microsoft MSFT and Meta Platforms META report earnings results.

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This article originally published on Zacks Investment Research (zacks.com).

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