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Pre-market futures are mixed after one of the best sessions in the stock market in years. With the surprise stepping-down of UnitedHealthcare (UNH) CEO Andrew Witty for “personal reasons,” effective immediately, the Dow component helped move the index -135 points at this hour. The S&P 500 and Nasdaq, on the other hand, are +5 points and +55 points, respectively — both off early-morning highs.
CPI for April Comes In-Line at Post-Covid Lows
Arguably the biggest economic print of this week is the Consumer Price Index (CPI) for the month of April. This not only brings us a new applicable Inflation Rate (CPI headline, year over year), but it also gives us a first glimpse into pricing issues based on the initial salvos in the (now cooling) global trade war.
Headline CPI month over month came in as expected at +0.2%, swinging to a positive from the previous month’s unrevised -0.1%, which hit lows not seen since four years ago. Stripping out volatile food and energy costs, the “core” read on monthly CPI also reached +0.2% — 10 basis points (bps) below estimates and up 10 bps from the prior month.
The Inflation Rate for April came in at a 4-year low to +2.3%, 10 bps beneath expectations and the unrevised +2.4% from March. Core CPI year over year reached +2.8%, in-line with estimates and also sitting at 4-year lows. These are all numbers investors and economists will presumably know how to deal with, even if they remain a bit hotter than the Fed’s optimal inflation rate of +2%.
Small Business Optimism Stays Relatively Weak
Also for April, the NFIB Small Business Index is out this morning, with the headline print coming in at 95.8 — better than the consensus estimate of 95.0, but well below the half-century average of 98 for the second-straight month. This follows a 97.4 posted a month ago.
The NFIB Uncertainty Index came in down -4 points to 92 for April. This is much higher uncertainty than the average monthly print of 68. Small business owners said 34% of open jobs remained unfilled last month, the lowest we’ve seen since January 2021, 10 months into the U.S. Covid Era, just before mass vaccinations were made available.
Q1 Earnings Roundup: Honda, JD, CyberArk
Honda Motor Company (HMC) posted a widely mixed fiscal Q4 report this morning, missing on earnings by -75% to 18 cents per ADS (from 72 cents expected). Revenues of $47.26 billion, on the other hand, swung to a profit of +6.2% year over year from an expected loss of -2.7%. This is the second earnings miss for the Japanese automaking giant in the past three quarters.