Here is what you need to know.
The global bond rout continues. Core European debt remains under pressure. Germany’s cost of borrowing over 10 years is up another 18.2% on Thursday with the 10-year yield higher by 10.6 basis points at 0.69%. Meanwhile, France’s 10-year yield crossed the 1.00% threshold for the first time in five months, but is now up 9.5 basis points at 0.994%. Peripheral debt has erased early losses with the Spanish and Italian 10-year yields both down 3 basis points at 1.86% and 1.88%, respectively. Here in the US, the 10-year yield is higher by 1 basis point at 2.26%.
Britain goes to the polls. The final poll before the election showed Prime Minister David Cameron neck and neck with challenger Ed Miliband. A second consecutive hung parliament is expected, something that has not happened in more than 100 years. Exit polls will be released at 9 p.m. local time. Great Britain’s pound is off 0.2% at 1.5221.
Australian jobs data disappointed. The Australian economy lost 2,900 jobs in April, causing the unemployment rate to tick up to 6.2%. Despite most of the new jobs being part-time, aggregate monthly hours rose 1.1%. Australia’s dollar is down 0.1% at .7960.
Norges Bank kept policy on hold.In a close call, Norway’s central bank held its key rate at 1.25%, surprising economists who were expecting a 25 basis point cut to 1.00%. Analysts now expect the central bank to cut its benchmark interest rate to a record low 1.00% at the June meeting as Norway’s economy continues to deal with the fallout from the oil crash. Norway’s krone is stronger by 1.2% at 7.3483 per dollar.
German factory orders missed. German factory orders gained traction in March, rising for the first time in three months. The sector advanced 0.9% month-over-month, but fell short of the 1.5% month-over-month gain that was anticipated.
Tesla beat on the top and bottom lines. The electric car maker reported a loss of $US0.36 per share, easily beating the $US0.51 loss that was anticipated. Revenues jumped 54.8% to $US1.1 billion, topping the $US1.0 billion that was expected. The company delivered 10,045 Model S vehicles in the first quarter, and believes it will deliver 55,000 Model S and Model X vehicles by year end. Model X deliveries are expected to begin late in the third quarter.
Whole Foods posted a mixed quarter. The supermarket giant announced diluted earnings of $US0.44 per share, topping the $US0.42 that was expected. Revenues climbed 9.8% to $US3.6 billion, but fell short of the $US3.7 billion that Wall Street was anticipating. The company expects comparable same store sales in the “low to mid single digits.”
Lumber Liquidators will stop selling Chinese laminate. CNBC reports, Lumber Liquidators is pulling Chinese laminate off store shelves, effective immediately. The announcement comes following the ’60 Minutes’ report in March, which outed the company for selling flooring with high levels of formaldehyde. Last week, the company announced a surprise quarterly loss, and that it would begin ‘scaling back’ sales of the flooring.
Stocks are lower across the globe. Heavy selling in Asia was paced by China’s Shanghai Composite (-2.8%) while Britain’s FTSE (-1.6%) leads the decline in Europe.
US economic data flows. Initial and continuing claims are scheduled for release at 8:30 a.m. ET and consumer credit is due out at 3 p.m. ET. Natural gas inventories will cross the wires at 10:30 a.m. ET. The US Dollar Index is little changed at 94.10.