Overnight Markets and News

June S&P 500 E-minis (ESM18 +0.39%) are trading higher by +0.50% this morning as some of the gloom from Monday dissipated and as overseas stock markets today did not fall as far as U.S. stocks did on Monday. The Euro Stoxx 50 index this morning is down -0.58%, which is a substantially smaller decline than Monday's -2.23% plunge in the S&P 500 index. Asian stocks this morning closed with losses of less than -1%: Japan Nikkei -0.45%, Hong Kong Hang Seng +0.29%, China Shanghai -0.84%, Taiwan TAIEX -0.61%, Australian S&P 200 -0.13%, Singapore Str. Times -0.54%, South Korea KOSPI 200 -0.20%, India Sensex 30 +0.35%, Turkey ISE National 100 +0.12%.

The dollar index (DXY00 +0.04%) this morning is trading slightly lower by -0.06 (-0.06%) and EUR/USD (^EURUSD unch) is slightly lower by -0.0011 (-0.09%). USD/JPY (^USDJPY +0.34%) is up +0.36 (+0.34%) on reduced safe-haven demand for the yen. June 10-year T-note prices (ZNM18 -0-050) are down -6.5 ticks as safe-haven demand faded with the partial recovery in E-minis.

May WTI crude oil (CLK18 +0.21%) this morning is up +0.33 (+0.52%) and May gasoline (RBK18 +0.57%)is up +0.0187 (+0.95%) on an upward rebound after Monday's sharp losses. Precious metals prices this morning are giving back some of Monday's sharp gains with June gold down 4.7 (-0.35%) and May silver down -0.127 (-0.76%), but May copper is up +0.011 (+0.34%). Grain prices this morning are trading higher with May corn up +0.25 (+0.06%), May soybeans up +7.75 (+0.75%), and May wheat up +4.25 (+0.95%). Softs this morning are mixed with May sugar down -0.19 (-1.52%), May coffee up +0.10 (+0.09%), May cocoa down -34 (-1.29%), and May cotton up +0.18 (+0.22%).

The Trump administration is reportedly pushing for a preliminary NAFTA agreement that it can announce next week.

The Australian central bank today at its monthly policy meeting left its key interest rate unchanged at a record low of 1.5% for the 20th straight month, which was fully in line with market expectations.

Bank of Japan Governor Kuroda told parliament that the Bank of Japan is internally discussing about how to begin exiting from its stimulus program but that it is too early to talk about details in public.

U.S. Stock Preview

Key U.S. news today includes: (1) Mar total vehicle sales (expected 16.90 million, Feb 16.96 million), (2) Minneapolis Fed President Neel Kashkari (non-voter) speaks at a regional economic forum in Duluth, MN, (3) Fed Governor Lael Brainard (voter) speaks about financial stability in a lecture at the Stern School of Business at NY Univ.

Notable Russell 1000 earnings reports today include: none.

U.S. IPO's scheduled to price today: Spotify (SPOT) in alternative IPO.

Equity conferences this week: Cowen & Co. Future of the Consumer Conference on Tue.

Market Comments

June S&P 500 E-minis this morning are moderately higher by +0.50%. Monday's closes: S&P 500 -2.23%, Dow Jones -1.90%, Nasdaq -2.89%. The S&P 500 on Monday closed sharply lower on China's announcement that already-announced tariffs on $3 billion of U.S. imports would go into effect on Monday. Stocks were also undercut by the weaker-than-expected March U.S. ISM manufacturing index report of -1.5 to 59.3 vs expectations of -1.2 to 59.6. There was also continued weakness in tech stocks on trade tensions. Amazon.com fell sharply as President Trump continued his tweet attack on the retailer.

June 10-year T-notes are down -6.5 ticks on reduced safe-haven demand. Monday's closes: TYM8 +4, FVM8 +3.50. Jun 10-year T-notes on Monday closed higher on safe-haven demand sparked by the sharp sell-off in stocks. T-notes also received support from the weaker-than-expected ISM manufacturing index of -1.5 to 59.3 and the recent easing of expectations for Fed rate hikes through 2019. The -3% plunge in May crude oil softened the inflation outlook.

The dollar index this morning is trading slightly lower by -0.06 (-0.06%) and EURUSD is slightly lower by -0.0011 (-0.09%). USD/JPY is up +0.36 (+0.34%) on reduced safe-haven demand for the yen. Monday's closes: Dollar Index +0.078 (+0.09%), EUR/USD -0.0022 (-0.18%), USD/JPY -0.39 (-0.37%). The dollar index on Monday closed slightly higher on trade tensions that sparked a big sell-off in U.S. stocks and possibly some capital flight from the U.S. The dollar was also undercut by the weaker-than-expected U.S. ISM manufacturing index report of -1.5 to 59.3, which was negative for the U.S. economy. USD/JPY fell by -0.37% as the yen saw some flight-to-quality demand on the sharp decline in U.S. stocks.

Precious metals prices this morning are giving back some of Monday's sharp gains with June gold down 4.7 (-0.35%) and May silver down -0.127 (-0.76%), but May copper is up +0.011 (+0.34%). Monday's closes: Apr gold +19.30 (+1.46%), May silver +0.404 (+2.48%), May copper +2.45 (+0.81%). Metals on Monday settled sharply higher on the plunge in stocks that sparked some flight-to-quality demand for precious metals. Copper prices received some support from the positive Chinese official manufacturing PMI report although the Caixan PMI report was weak.

May WTI crude oil this morning is up +0.33 (+0.52%) and May gasoline is up +0.0187 (+0.95%) on an upward rebound after Monday's sharp losses. Monday's closes: May crude -1.93 (-2.97%), May gasoline -0.0545 (-2.70%). May crude oil and gasoline on Monday fell sharply on the plunge in in U.S. stocks, which was negative for the economic outlook and energy demand. In addition, trade tensions and a risk-off mentality caused capital flight from the commodity sector.

Overnight U.S. Stock Movers

Spotify Technology (SPOT) today is scheduled to hold an alternative IPO where the shares simply start trading publicly without the traditional Wall Street bank managing an IPO process.

At Tesla (TSLA -5.13%), CEO Elon Musk said he is personally taking charge of the Model 3 production line on order to fix production delays and meet the company's aggressive production targets.

Baker Hughes (BHGE) was upgraded to overweight from neutral and the price target was raised to $39 from $35 at Piper.

Switch (SWCH -0.38%) fell sharply by -10% in after-hours trading after its 2018 Ebitda forecast missed the consensus.

Viacom (VIAB -1.64%) fell sharply in after-hours trading on a report that CBS is preparing a below-market initial bid.

Wyndham (WYN -2.92%) received a rating of Outperform in new coverage by Oppenheimer with a price target of $135.