Before markets open on Thursday, here is what you need to know.
Greece paid the IMF. The troubled country met its 460 million euro ($US495.82 million) debt obligation to the International Monetary Fund. According to HSBC, the real ‘crunch point’ will occur on May 12, when 767 million euro payment to the IMF is due. Greece’s 3-year yield is lower by 58 basis points at 20.41%.
The Bank of England took no action at today’s meeting. The central bank held its Official Bank Rate at 0.50% and its asset purchase program at 375 billion pounds. Both were expected. Great Britain’s pound is off 0.3% at 1.4820.
The Bank of Korea kept policy on hold. South Korea’s central bank held its benchmark interest rate at a record low 1.75%, as expected. Following the announcement, the BOK lowered its 2015 growth forecast to 3.1% (3.4% previous) and its 2015 inflation outlook to 0.9% (1.9% previous). South Korea’s won is down 0.2% at 1092.60 per dollar.
German data disappointed. Industrial production posted a surprise drop, slipping 0.3% year-over-year. The country’s trade surplus edged up to 19.7 billion euros (19.6 billion euros previous), but missed the 20.3 billion euro estimate as imports rose 1.8% YoY and exports climbed 1.5% YoY. Germany’s 10-year yield is off 2 basis points at a record low 0.15%.
UK Oil and Gas Investments made a huge oil discovery. The exploration company says it discovered approximately 100 billion barrels of oil in the South of England. However, the company admitted only 3% to 15% was likely to be recovered. The company’s stock was up as much 325% on the news.
JP Morgan CEO Jamie Dimon released his annual later to shareholders. Dimon said recent action in fixed income and foreign exchange markets is a “warning shot across the bow,” and that the the bond ‘flash crash’ that occurred on October 15 is something that happens ‘once in every 3 billion years or so.’
Alcoa kicked off earnings season with mixed results. The aluminium maker announced earnings of $US0.28 per share, topping the $US0.26 per share that was expected. Revenues were light at $US5.82 billion, missing analyst expectations of $US5.94 billion. The company upped its global demand forecast, noting, “Given final 2014 worldwide aluminium demand, Alcoa has upwardly revised its view of global aluminium demand growth in 2015 to 9 per cent, an increase from the prior forecast of 7 per cent. This results in global consumption of 54 million metric tons, or 1.2 million metric tons higher than previously forecast.”
PetroChina is the world’s largest oil company. PetroChina’s market cap reached $US352.8 billion, surpassing Exxon Mobile ($US352.6 billion) for the first time in five years. The Chinese energy giant has rallied 61% over the past year, but has vastly underperformed the Shanghai Composite which sports a gain of almost 90% over that time.
Global stock markets are mixed. France’s CAC (+0.8%) leads European markets higher after Hong Kong’s Hang Seng (+2%) led the way in Asian trade. China’s Shanghai Composite (-0.8%) was a notable laggard.
US economic data is light. Unemployment claims are due out at 8:30 a.m. ET and wholesale inventories will cross the wires at 10 a.m. ET. The Energy Information Administration will release the latest natural gas storage data at 10:30 a.m. ET. Treasury reopens $US13 billion 30-year bonds at 1 p.m. ET. The US 10-year yield is on session lows, down 3 basis points at 1.88%