Here is what you need to know.
China’s trade surplus shrank. China’s trade surplus narrowed to $29.86 billion in March, which was worse than the $30.85 billion that economists had forecast. The narrower surplus came despite exports growing by 11.5% in US dollar terms. While exports picked up, imports remained weak, falling 13.8% from a year ago. The Chinese yuan ended weaker by 0.1% at 6.4719 per dollar.
Europe is entering an industrial slowdown. Eurozone industrial production fell 0.8% in February, according to Eurostat. The reading was below the 0.7% drop that economists had forecast, and was far softer than the 1.9% increase seen in January. Ireland, Greece and Croatia saw the biggest declines, falling 10.5%, 4.4% and 1.6%, respectively.
Russia has confirmed oil talks with Saudi Arabia. Russian oil minister Alexander Novak has confirmed he held production freeze talks with Saudi oil minister Ali al-Naimi. “Now I do not want to comment prematurely on what will be discussed on April 17 in Doha. Let’s wait for the consultations,” Novak told Russian news agency TASS. “The talks were held yesterday, this is a fact, but I will not announce the decision beforehand.” Crude oil is trading down 1.4% at $41.58 per barrel.
The IMF wants debt relief for Greece. The International Monetary Fund says Greece’s debt load is “highly unsustainable” and wants its creditors to grant substantial relief, according to an IMF memorandum seen by Reuters. On Tuesday, Greece and its creditors broke off talks as the two sides were unable to agree on what to do about the fiscal gap the country faces in 2018. Talks are expected to resume after this week’s IMF spring meetings in Washington D.C. “To restore debt sustainability, in addition to our reform efforts, decisive action by our European partners to grant further official debt relief will be essential,” the IMF’s draft said, according to Reuters.
JPMorgan beats. The bank earned $1.35 per share, topping the Bloomberg consensus of $1.24. Revenue of $24.08 billion outpaced the $23.80 billion that analysts were anticipating. “While challenging markets impacted the industry, we maintained our leadership positions and market share in the Corporate & Investment Bank and Asset Management, reflecting the strength of our platform,” CEO Jamie Dimon said in the earnings release. Bank of America and Wells Fargo are up next, reporting their Q4 results ahead of Thursday’s opening bell.
Some Wall Street banks will have their “living wills” rejected. The Wall Street Journal reports, the “living wills” of at least four of the eight systemically important Wall Street banks will be rejected by federal regulators. The wills are plans for how a bank would wind down operations in the event of crisis without the help of taxpayer money. The WSJ says JPMorgan Chase, BNY Mellon, State Street Bank and Bank of America are most likely to have their plans rejected, and that Citigroup’s will would likely been given the green light. The fate of the plans submitted by Goldman Sachs, Wells Fargo and Morgan Stanley are unknown, the Journal says.
The world’s second largest coal miner has filed for bankruptcy. Peabody Energy has filed for Chapter 11 bankruptcy protection, making it among the largest causalities of the commodities crash. According to a court filing, Peabody showed both assets and liabilities in the range of $10 billion to $50 billion. The company says operations will continue as normal as it works its way through bankruptcy proceedings. “Through today’s action, we will seek an in-court solution to Peabody’s substantial debt burden amid a historically challenged industry backdrop,” Peabody CEO Glenn Kellow said. “This process enables us to strengthen liquidity and reduce debt, build upon the significant operational achievements we’ve made in recent years and lay the foundation for long-term stability and success in the future.”
Valeant is facing default. The embattled drugmaker has received word one of its creditors will call a default on the company after it failed to file its annual report by March 15. Valeant is now facing a 60-day window in which it must file its report or pay its bonds back early. According to a statement filed by the company, it’s “working diligently and is on schedule to file its 10-K on or before April 29, 2016.”
Stock markets everywhere are green. Hong Kong’s Hang Seng (+3.2%) led the gains in Asia and France’s CAC (+2.5%) paces the advance in Europe. S&P 500 futures are up 11.50 points at 2067.25.
US economic data is heavy. PPI and retail sales will cross the wires at 8:30 a.m. ET and business inventories will be announced at 10 a.m. ET. The Fed’s Beige Book is set for 2 p.m. ET. US crude oil inventories are due out at 10:30 a.m. ET. The US 10-year yield is higher by 1 basis point at 1.79%.