Market Insights

Don’s Notebook April 26, 2018

Durable goods were expected to post another month of strength including for capital goods, results that would confirm acceleration for the factory sector. Excluding transportation equipment, however, durable goods orders came in unchanged.

• Vehicle orders, which like aircraft are part of the transportation group, were flat and not a factor in the month. New orders for civilian aircraft were strong once again in March, at a monthly 44.5 percent gain on top of February’s 39.1 percent surge.
  • These gains are what’s behind the strong overall headlines of the past two reports, at 2.6 percent in March and an upwardly revised 3.5 percent in February.
• A key element of the report is weakness in machinery, the key component of the capital goods sector and where new orders fell 1.7 percent.
• Orders for computers were also down while orders for electrical equipment were flat.

Overnight:

• The Asia Pacific Index was flat.
• Japan’s Topix index closed 0.3 percent higher.
• In Europe, the Stoxx 600 Index was 0.4 percent higher at 6 a.m. ET after a deluge of earnings ahead of today’s ECB decision.

The European Central Bank makes its interest rate announcement. No rate change is expected, but observers will watch for comments on future stimulus plans.

Notable Earnings today: General Motors, Spirit Airlines, AbbVie, D.R Horton, UPS, Dunkin Brands, Intel, Starbucks, PepsiCo and Amazon host conference calls today.