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US STOCKS-Wall St edges lower as tech stocks, bond yields weigh - Reuters News

24-Apr-2018 03:13:54 AM

• 10-year Treasury yields hit four-year high
• Aluminum stocks drop as U.S. weighs sanctions relief
• Alphabet results expected after the bell
• Dow down 0.47 pct, S&P 500 down 0.40 pct, Nasdaq down 0.67 pct

Updates to late afternoon, changes byline

By Stephen Culp

NEW YORK, April 23 (Reuters) - Wall Street fell into negative territory on Monday as signs of soft smartphone demand took a toll on tech stocks and a rise in bond yields dented demand for equities, offsetting optimism on earnings.

Tech stocks were a drag on all three major U.S. indexes ahead of a big week of earnings for the sector. Chipmaker shares fell after the world's largest contract chipmaker, Taiwan Semiconductor Manufacturing Co Ltd, cut its full-year revenue target due to softer demand for smartphones.

Yields on 10-year U.S. Treasuries rose to their highest level since January 2014 amid concerns over the growing supply of government debt and accelerating inflation.

While rising yields can lead investors away from equities, the robust earnings season gave reason for confidence.

"Earnings continue to be healthy and in many respects exceed market expectations. It continues to suggest an overall strength in the economy, and we're seeing more and more above-trend growth," said Steven Baffico, chief executive officer at Four Wood Capital Partners in New York.

"One good quarter does not a year make, but I think you can look at overall strength in earnings as a good leading indicator for the equity market," said Baffico.

Analysts expect earnings growth at S&P 500 companies of nearly 20 percent in the first quarter, the strongest showing in seven years, according to Thomson Reuters data.

Quarterly results are expected this week from 181 S&P 500 companies, including technology heavy-hitters Facebook Inc, Microsoft Corp, Amazon.com Inc and Intel Corp. Alphabet Inc reports after the market closes on Monday.

Alphabet is expected to post first-quarter adjusted earnings per share of $9.28. Heightened options activity ahead of Alphabet's report implied a 4.9 percent stock price swing in either direction by Friday.

At 3:13PM ET, the Dow Jones Industrial Average fell 58.33 points, or 0.24 percent, to 24,404.61, the S&P 500 lost 4.48 points, or 0.17 percent, to 2,665.66, and the Nasdaq Composite dropped 27.71 points, or 0.39 percent, to 7,118.42.

Of the 11 major S&P sectors only telecom and healthcare were in positive territory.

The Philadelphia Semiconductor index was down 1.2 percent and was on track for its fourth straight session of declines on concerns of slowing smartphone demand.

Merck & Co Inc helped lift the healthcare sector, up 2.3 percent following a Goldman Sachs upgrade to "buy."

Aluminum company stocks dropped as the United States opened the door to sanctions relief for Russian aluminum giant United Company Rusal Plc. Alcoa tumbled 13.9 percent and Arconic fell 4.8 percent, making it the biggest percentage loser on the S&P.

Declining issues outnumbered advancing ones on the NYSE by a 1.88-to-1 ratio; on Nasdaq, a 1.81-to-1 ratio favored decliners.

 

(Reporting by Stephen Culp
Editing by Leslie Adler)

 

 

 

UPDATE 9-Oil settles higher; fears of Iran sanctions end early slide - Reuters News

24-Apr-2018 04:06:48 AM

• WTI-Brent spread is at widest since January
• Strong demand, OPEC cuts still support prices overall

New throughout, updates prices and market activity to post-settlement trading

By Jessica Resnick-Ault

NEW YORK, April 23 (Reuters) - Oil prices rebounded from an early slide to finish higher and strengthen further in post-settlement trade, as investors feared U.S. sanctions could dampen Iran's output.

"It's tweet by tweet," said Phil Flynn, analyst at Price Futures Group, saying the market is swinging in response to posturing from the United States and OPEC members.

Oil prices tumbled early on fears that oversupply could return. Iran's oil minister Bijan Zanganeh said there would be no need to extend a pact between the Organization of the Petroleum Exporting Countries and non-OPEC producers if oil prices strengthened, the ministry's official website SHANA reported.

Flynn said the market recovered on conviction U.S. sanctions could dampen Iran's output, even if the nation produces above its OPEC quota.

Also supporting prices, energy information provider Genscape showed a decline in inventories at the Cushing, Oklahoma storage hub for U.S. crude.

Brent crude futures settled up 65 cents, or 0.9 percent, to $74.71 a barrel, after falling as low as $73.13. U.S. West Texas Intermediate crude futures rose 24 cents to $68.64 a barrel, rebounding from a session low of $67.14. The difference between the two benchmarks was at its widest since Jan. 8..

In post-settlement trading, Brent kept edging higher to $75.08 a barrel.

Since early 2017, OPEC, Russia and other non-OPEC crude producers have curbed output to reduce a global oil glut. The pact runs until the end of 2018.

"We continue to watch whether the fundamental picture continues to tighten," said Gene McGillian, vice president of research at Tradition Energy.

In early trade, oil fell along with other raw materials after the United States gave American customers of Russia's biggest aluminum producer Rusal more time to comply with sanctions.

This month, oil has risen to its highest since late 2014. Prices have been supported by U.S. sanctions on Russian companies and individuals and by fears Washington may take new measures against struggling Venezuela and especially OPEC member Iran.

"Added price pressure comes from U.S. sanctions against the key oil exporting nations of Venezuela, Russia and Iran," said Kerry Craig, global market strategist at JPMorgan Asset Management.

"Stay long oil," JPMorgan said in a separate note.

The United States has until May 12 to decide whether it will leave a nuclear deal with Iran and impose new sanctions against Tehran.

"The uncertainty of the administration makes things very difficult," McGillian said, cautioning that sanctions against Iran or Venezuela could also cause market swings.

 

(Additional reporting by Henning Gloystein in SINGAPORE and Amanda Cooper in London; Editing by Marguerita Choy and David Gregorio)

 

 

 

UPDATE 5-U.S. extends deadline for Rusal sanctions, aluminum prices dive - Reuters News

24-Apr-2018 02:06:37 AM

• U.S. says Rusal could see relief if Deripaska ends control
• Europe pressing Trump over Russia sanctions
• Aluminum prices had rallied on sanctions last week

Recasts first paragraph, adds context on aluminum market

By Susan Heavey and Polina Devitt

WASHINGTON/MOSCOW, April 23 (Reuters) - The United States on Monday gave American customers of Russia's biggest aluminum producer more time to comply with sanctions, and said it would consider lifting them if United Company Rusal Plc's major shareholder, Russian tycoon Oleg Deripaska, ceded control of the company.

Aluminum prices on the London Metal Exchange tumbled more than 8 percent after the U.S. Treasury Department announcement, which gives Rusal longer to sell off large quantities of aluminum it had been stockpiling in the wake of sanctions.

Last week, aluminum prices rallied to their highest in years after Washington, in response to what it called "malign activities" by Russia, imposed the sanctions that will in effect choke off access for Deripaska's businesses to the international financial system.

Treasury gave Americans until Oct. 23 instead of June 5 to wind down business with Rusal. It said it would not impose secondary sanctions on non-U.S. entities engaged with Rusal or its subsidiaries.

Shares in Rusal, one of the world's largest aluminum companies, jumped nearly 18 percent on the Moscow Exchange on the announcement. Earlier, Rusal had ended Hong Kong trading down 8.4 percent. Shares of its U.S. rival Alcoa Corp slid more than 13 percent.

"Rusal has felt the impact of U.S. sanctions because of its entanglement with Oleg Deripaska, but the U.S. government is not targeting the hardworking people who depend on Rusal and its subsidiaries," U.S. Treasury Secretary Steven Mnuchin said.

Workers at one of Russia's biggest aluminium smelters say their Siberian town is doomed unless Moscow mitigates U.S. sanctions against Rusal, a predicament mirrored across the company's sprawling operations.

Deripaska owns a 48 percent stake in Rusal "and controls the company via his shareholder agreement with other owners," said Oleg Petropavlovsky, a senior analyst at BCS Global Markets. "It is not clear whether potential cancellation of this shareholder agreement would be enough" to satisfy U.S. officials, he said.

Rusal declined to comment on the Treasury Department announcement. The Kremlin and Deripaska did not immediately respond to requests for comment.

 

NO LONGER 'RADIOACTIVE'

European leaders have worked to persuade U.S. President Donald Trump to ease sanctions on Russia, with the president of France poised to visit the White House this week.

Mnuchin said "impact on our partners and allies" factored into the reprieve. French sources said initial feedback had been "constructive."

Rusal now has more time to sell off its supply. Even if sanctions are not ultimately lifted, buyers also have more time to seek other suppliers.

Last week, aluminum rallied to its highest since mid-2011 on fears the global market could face shortages as a result of the U.S. sanctions. It remains up more than 16 percent this month.

Wood Mackenzie analysts said Treasury's announcement provides "much-needed breathing space" for the aluminum market, adding "We expect near-term correction and volatility" in prices.

Edward Meir, an analyst at INTL FCStone, said there is potential for Rusal to survive and that "the 5 mln (million) tons of Rusal production that a week ago was arguably radioactive, will no longer be so."

 

(Reporting by Susan Heavey in Washington, Polina Devitt in Moscow, Pratima Desai in London; Writing by David Gregorio; Editing by Marguerita Choy)

 

·         24-Apr-2018 04:00:34 AM - US WINTER WHEAT - 31 PCT CONDITION GOOD/EXCELLENT VS 31 PCT WK AGO (54 PCT YR AGO) -USDA

·         24-Apr-2018 04:00:34 AM - US CORN - 5 PCT PLANTED VS 3 PCT WK AGO (14 PCT 5-YR AVG) -USDA

·         24-Apr-2018 04:00:34 AM - US SOYBEANS - 2 PCT PLANTED (5 PCT YR) (2 PCT 5-YR AVG) -USDA

·         24-Apr-2018 04:00:34 AM - US SPRING WHEAT - 3 PCT PLANTED VS 3 PCT WK AGO (25 PCT 5-YR AVG) -USDA

·         24-Apr-2018 04:00:34 AM - US WINTER WHEAT - 13 PCT HEADED VS 9 PCT WK AGO (19 PCT 5-YR AVG) -USDA

 

CBOT soybeans close lower for third straight day - Reuters News

24-Apr-2018 02:36:26 AM

CHICAGO, April 23 (Reuters) - Chicago Board of Trade soybean futures fell for the third session in a row on Monday on fears of a slowdown in purchases from China due to harsh trade rhetoric between Beijing and Washington.

·         The U.S. Agriculture Department has not reported a new soybean deal with China since April 10.

·         Technical support for the CBOT May soybean futures contract was noted near its 100-day moving average.

·         Soymeal and soyoil futures also fell on Monday.

·         USDA reported weekly soybean export inspections of 470,817 tonnes in the latest week. Analysts forecasts for corn export inspections ranged from 300,000 to 600,000 tonnes.

·         Analysts were expecting a USDA report on Monday afternoon to show that 2 percent of the U.S. soybean crop had been planted as of April 23.

	Last	Net chng	Pct chng	Low	High	Volume
SOYBEANS MAY8	1020.75	-8.00	-0.9	1017.25	1033.25	53540
SOYBEANS JUL8	1032.25	-8.00	-0.9	1029.00	1045.00	116646
SOY MEAL MAY8	371.80	-2.30	-0.6	370.90	376.70	25432
SOY MEAL JUL8	376.20	-2.40	-0.6	375.30	381.30	47471
SOYBEAN OIL MAY8	31.04	-0.26	-1.1	30.89	31.40	58204
SOYBEAN OIL JUL8	31.30	-0.26	-1.1	31.15	31.65	95177

 

(Reporting by Mark Weinraub
Editing by James Dalgleish)

 

 

 

CBOT soft red winter wheat eases, K.C. wheat firm - Reuters News

24-Apr-2018 02:33:33 AM

CHICAGO, April 23 (Reuters) - U.S. wheat futures ended mixed on Monday, with Chicago Board of Trade soft red winter wheat contracts easing on technical selling while K.C. hard red winter wheat offerings firmed on concerns about crop conditions.

·         CBOT May soft red winter wheat hit resistance at its five-day moving average and fell to its lowest since April 5.

·         MGEX spring wheat also fell, dropping 2 percent on forecasts for improving planting weather in the northern U.S. Plains.

·         K.C. hard red winter wheat contracts received support as weekend rains fell below expectations in key growing areas of the U.S. Plains.

·         The U.S. Agriculture Department reported weekly wheat export inspections of 619,251 tonnes in the latest week. Analysts forecasts for wheat export inspections ranged from 350,000 tonnes to 550,000 tonnes.

·         Analysts were expecting a USDA report on Monday afternoon to show that good-to-excellent ratings for the U.S. wheat crop improved to 32 percent as of April 22, up 1 percentage point from a week earlier.

	Last	Net chng	Pct chng	Low	High	Volume
WHEAT SRW MAY8	462.25	-1.00	-0.2	458.75	469.00	55137
WHEAT SRW JUL8	474.50	-2.75	-0.6	472.25	483.25	85577
WHEAT HRW MAY8	483.50	0.75	0.2	480.00	489.75	13650
WHEAT HRW JUL8	502.50	0.50	0.1	499.00	509.00	31726
SPG WHT MAY8	588.00	-12.00	-2.0	587.75	603.50	3902
SPG WHT JUL8	595.00	-10.75	-1.8	594.75	609.50	6195

 

(Reporting by Mark Weinraub
Editing by Chizu Nomiyama)

 

 

 

CBOT corn ends higher; planting in focus - Reuters News

24-Apr-2018 02:25:26 AM

CHICAGO, April 23 (Reuters) - Chicago Board of Trade corn futures closed firm on Monday, with a slow pace of planting underpinning prices despite forecasts for warmer weather in the U.S. Midwest.

·         Technical buying at the benchmark CBOT May contract's 200-day moving averages pushed prices higher after early weakness.

·         The U.S. Agriculture Department report weekly corn export inspections of 1.719 million tonnes in the latest week. Analysts forecasts for corn export inspections ranged from 1.2 million to 1.7 million tonnes.

·         Analysts were expecting a USDA report on Monday afternoon to show that 7 percent of the U.S. corn crop had been seeded as of April 22, up from 3 percent last week.

 

	Last	Net chng	Pct chng	Low	High	Volume
CORN MAY8	378.50	2.00	0.5	376.25	379.25	110983
CORN JUL8	387.50	2.00	0.5	385.25	388.00	166098
ETHANOL MAY8	1.490	-0.009	-0.6	1.490	1.507	151
ETHANOL JUN8	1.476	-0.005	-0.3	1.474	1.490	151

 

(Reporting by Mark Weinraub; Editing by Lisa Shumaker)