OVERNIGHT MARKETS AND NEWS

Jun E-mini S&Ps (ESM17 -0.28%) this morning are down -0.28% at a 2-week low and European stocks are down -0.52%. Geopolitical concerns from North Korea, Syria and the French presidential elections have all increased uncertainty in global markets and pushed the VIX volatility index up to a 5-month high, which is weighing on stocks. Comments late Wednesday from President Trump have pushed the dollar index down to a 2-month low and the 10-year T-note yield down to a 4-3/4 month low when he said, “the dollar is too strong” and that he likes “a low interest rate policy.” The increase in volatility along with the weak dollar has bolstered demand for gold with Jun COMEX gold (GCM17 +0.88%) up +0.88% at a 5-month high. Trading activity was subdued ahead of the Easter holiday, where markets in the U.S. will be closed Friday and will be closed Friday and Monday in Europe. Asian stocks settled mixed: Japan -0.68%, Hong Kong -0.21%, China +0.07%, Taiwan +0.19%, Australia -0.74%, Singapore -0.53%, South Korea +1.05%, India -0.61%. China’s Shanghai Composite eked out a gain on signs of strength in the Chinese economy after China Mar exports and imports both rose more than expected. Japan’s Nikkei Stock Index tumbled to a 4-month low after a fall in USD/JPY to a 4-3/4 month low fueled a sell-off in exporter stocks as the stronger yen undercuts the earnings prospects of Japanese exporters.

The dollar index (DXY00 -0.45%) is down -0.44% at a 2-week low. EUR/USD (^EURUSD) is down -0.25%. USD/JPY (^USDJPY) is unch.

Jun 10-year T-note prices (ZNM17 +0.52%) are up +21.5 ticks at a 4-3/4 month high.

The China Mar trade balance was in surplus by +$23.93 billion, wider than expectations of +$12.5 billion. Mar exports jumped +22.3% y/y, stronger than expectations of +8.0% y/y and the largest increase in 2-years. Mar imports surged +26.3% y/y, stronger than expectations of +15.0% y/y.

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) weekly initial unemployment claims (expected +11,000 to 245,000, previous -25,000 to 234,000) and continuing claims (expected -4,000 to 2.024 million, previous -24,000 to 2.028 million), (2) Mar PPI final demand (expected unch m/m and +2.4% y/y, Feb +0.3% m/m and +2.2% y/y) and Mar core PPI (expected +0.2% m/m and +1.8% y/y, Feb +0.3% m/m and +1.5% y/y), (3) preliminary-Apr University of Michigan U.S. consumer sentiment index (expected -0.4 to 96.5, Mar +0.6 to 96.9), and (4) USDA weekly Export Sales. Friday is a market holiday but the federal government is open and reports include: (1) Mar CPI (expected unch m/m and +2.6% y/y, Feb +0.1% m/m and +2.7% y/y) and Mar core CPI (expected +0.2% m/m and +2.3% y/y, Feb +0.2% m/m and +2.2% y/y), (2) Mar retail sales (expected -0.2% and +0.1% ex autos, Feb +0.1% and +0.2% ex autos), and (3) Feb business inventories expected +0.3%, Jan +0.3%.