Fixed Income Market Overview
On Tuesday, U.S. Treasury yields declined as investors reviewed fresh manufacturing data and awaited upcoming economic reports. The 10-year Treasury yield fell by 3.3 basis points to 4.592%, while the 2-year yield was at 4.94%. A reading of 49.9 for the S&P Global Flash U.S. manufacturing PMI indicated a contraction in the sector. Economist Ian Shepherdson suggested markets might be surprised by the data’s support for rate cuts. Further data this week, including the PCE price index and Q1 GDP, will influence Fed policymakers’ decisions at their upcoming meeting. Investors are keen to understand the economy’s resilience and inflationary pressures, which could impact expectations for future rate cuts. Fed officials have emphasized that rate cuts will depend on economic conditions, with no rush indicated for immediate action.
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U.S. oil rise 1% to nearly $83 a barrel as slowing manufacturing raises interest rate cut hopes.
Major Indicies
| Symbol | Price | Change | %Change |
|---|---|---|---|
| DJIA | 38,503.69 | 263.71 | 0.69%↑ |
| NASDAQ | 17,471.47 | 260.58 | 1.51%↑ |
| SNP 500 | 5,070.55 | 59.95 | 1.20%↑ |
| NIKKEI | 37,552.16 | 113.55 | 0.30%↑ |
| VIX | 15.69 | -1.25 | -7.38%↓ |
| HIS | 16,828.93 | 317.24 | 1.92%↑ |
Bonds
| Name | Yeild | CHG |
|---|---|---|
| US 10-YR | 4.61% | -0.01 |
| US 30-YR | 4.73% | 0.01 |
| US 5-YR | 4.64% | -0.02 |
| JPN 10-YR | 0.89% | 0.00 |
| UK 10-YR | 4.24% | 0.04 |
Futures & Commodities
| Name | Last | Change | %Change |
|---|---|---|---|
| WTI CRUDE | 83.36 | 0.51 | 0.62%↑ |
| NAT GAS | 2.094 | 0.303 | 16.92%↑ |
| GOLD | 2,342.10 | -4.30 | -0.18%↓ |
| SILVER | 27.36 | 0.12 | 0.43%↑ |
| COPPER | 4.435 | -0.042 | -0.93%↓ |
Equity Market Overview
Tesla
Tesla’s shares rose ahead of its first-quarter results, expected to reveal its lowest gross profit margin in over six years due to price cuts and declining demand. CEO Elon Musk faces scrutiny over the fate of the Model 2, amid reports of its cancellation in favor of a self-driving robotaxi. Slowing sales growth, evidenced by an 8.5% decline in deliveries and repeated price cuts, poses challenges for Tesla’s profitability, with analysts forecasting a 15.2% automotive gross margin and a 5.05% revenue dip in the March quarter. Despite Musk’s promises of fully autonomous cars, technological and regulatory hurdles persist, casting doubt on Tesla’s self-driving vehicle strategy.
JetBlue Airways
JetBlue Airways saw its shares plummet by 15% following a downward revision of its 2024 revenue forecast, signaling challenges in its path to profitability. The airline anticipates a steeper second-quarter revenue decline than analysts projected, with full-year sales expected to dip, contrasting initial estimates. JetBlue’s costcutting measures and route optimization initiatives aim to mitigate losses, exacerbated by the recent cancellation of its merger with Spirit Airlines. Despite obstacles such as the Pratt & Whitney engine recall affecting its operations, JetBlue remains committed to refining its standalone strategy to regain profitability, while exploring additional cost-cutting measures.
General Electric Company
GE Aerospace witnessed a substantial surge in shares as quarterly profit and revenue exceeded expectations, with an upward revision of the full-year outlook. CEO Larry Culp highlighted robust performance and growing demand in both GE Aerospace and GE Vernova, particularly in services amidst an upswing in air travel. First-quarter results showcased impressive revenue growth, with GE Aerospace reporting a 15% rise in standalone revenue and a notable increase in orders, contributing to a raised 2024 guidance range for operating profit and adjusted EPS. Despite market volatility, GE’s stock has demonstrated significant year-to-date growth, reflecting investor confidence in its aerospace segment’s performance.
