European and Asian stock markets were lower following yesterday's weak action in the U.S., while domestic equities futures are also still in the red. Following the big FOMC rate decision (that wasn't at all unexpected), consensus calling for a September rate hike remains, though it's clear that every economic report still counts, as the Fed has given themselves plenty of leeway before having to raise rates. The dollar also remains weak in early trading.
In other, non-shocking news, Moody's has lowered Greece's credit rating to Caa2 from Caa1 with a negative outlook. More comically, Bloomberg is reporting that Greece and the International Monetary Fund and European Union representatives have agreed to conduct intensive negotiations, as their goal is to come to a preliminary deal by May 3 and a final agreement by May 11. Phew! At least they have finally agreed to something! Let's hope that general agreeable mood continues.
Meanwhile, with our eyes still focused overseas, the Bank of Japan voted to keep its monetary stimulus in place, staying in the herd of central banks injecting capital into the global economies. And in Russia, its central bank cut its main lending rate by 150 basis points to 12.5%, which is down from the 17% rates were at in mid-December when the rouble was imploding.
The M&A rumor mill was running hot yesterday. Bloomberg reported that salesforce.com (CRM) had hired investment bankers to begin taking offers after the company was approached by a potential acquirer. There are only a few companies that could pull off a deal of such size and that group includes Oracle (ORCL) -- who has denied it's involved ¿ Microsoft (MSFT), IBM (IBM), Hewlett-Packard (HPQ) and SAP (SAP). Separately, OmniVision (OVTI) is rumored to being close to sell to China's Hua Capital for $1.7 billion.
In the realm of bizarre news, there are reports that some tattooed customers wearing Apple's (AAPL) new watch are having problems with a bunch of the watch's functions ¿ apparently, the gadget is getting thrown off by the ink.
Notable earnings that come out today include: Quanta Services (PWR), Cigna (CI), Viacom (VIAB), ConocoPhillips (COP), Teva Pharmaceutical (TEVA), Delphi Automotive (DLPH), Colgate-Palmolive (CL), Cardinal Health (CAH), Celgene (CELG), Automatic Data Processing (ADP), Exxon Mobil (XOM), Cypress Semiconductor (CY, Trifecta Stocks' Harman International (HAR) and G&K Services (GK), Western Union (WU), FireEye (FEYE), LinkedIn (LNKD), Visa (V), Gilead Sciences (GILD), Growth Seeker's Skyworks Solutions (SWKS).
Last, we have a busy economic calendar today with the Employment Cost Index (consensus is at 0.6%), Personal Income (0.2% expected), Personal Spending (0.5% expected), Initial Jobless Claims (290,000 expected), and Continuing Claims all released at 8:30 a.m. At 9:45 a.m. we will get the Chicago Purchasing Manager (50.0 expected) and the Bloomberg Consumer Comfort reports.
Happy trading!
