Daily Markets: Retail Spending, China’s Zero Covid Announcement Lifts Market Mood


Today’s Big Picture

Asia-Pacific equity indexes ended today’s session up across the board as Australia’s ASX All Ordinaries closed up 0.33%, Japan’s Nikkei rose 0.42%, India’s Sensex gained 0.45%, China’s Shanghai Composite advanced 0.65% and Korea’s KOSPI and Taiwan’s TAIEX closed ahead 0.92% and 0.98%, respectively. Hong Kong’s Hang Seng led the way up 3.27%, driven by tech as China indicated is has reached its Covid Zero status, which assumedly means life is close to returning to normal, including production and trade. By mid-day trading, European equity indices are up across the board, and U.S. futures point to a strong market open later this morning.

Investors are geared up for Retail Sales data and Fed Chairman Jay Powell’s comments later today. We suspect that the same optimism that spurred Hong Kong markets ahead in the overnight session is also playing into the premarket rally. While trading in Walmart (WMT) is down in pre-market, market optimism may be partly driven by that company’s results. Despite missing on earnings due to the rising price of cost of goods, Walmart still showed strength in top-line growth and raised its sales outlook for the rest of the year. Still, CEO Doug McMillon remarked that “U.S. inflation levels, particularly in food and fuel, created more pressure on margin mix and operating costs than we expected.” As we see China begin to emerge from its economically crippling Zero Covid policy, that should help reduce the inflationary pressures due to low production levels and shipping delays. We’re not out of the woods yet, but we may have just found a pathway out of sorts.

Data Download

International Economy

While this morning was relatively light on the international economic release front, we did get a revised preliminary YoY Q1 GDP figure for the Eurozone at 5.10%, up 0.10% from the initial release. We also saw some unemployment figures from France, which announced their Q1 Unemployment rate at 7.30% which tightened 0.10% from the previously released figure. The UK also released unemployment for March at 3.70% which tightened about .10% from the previously announced 3.80%. 

Domestic Economy

8:30 AM ET will see the release of MoM Retail Sales for April. Topline figures are expected to show growth of 0.90%, up from 0.75% while sales ex-autos is expected to drop to show 0.30% growth from the previous month’s 1.40%. Interestingly, sales ex-autos and auto fuel are expected to have advanced to 0.80% from 0.71% in March.

9:15 AM ET will see the release of April Capacity Utilization expected to tick up to 78.5% from the previous reading of 78.3% and MoM Industrial Production which is expected to rise 0.40% which, while still positive is below the previously reported 0.90%.

10:00 AM ET will see the May update for the National Association of Home Builders (NAHB) Housing Market Index which is expected to soften slightly to 75 from the previously surveyed 77.


Yesterday was another roller coaster ride for equities, with the major market indices moving between gains and losses before the S&P 500 closed the day down 0.4%. The Nasdaq Composite gave back 1.2% from Friday’s positive market action while the Russell 2000 shed 0.5%. The Dow Jones Industrial Average eked out a very modest gain. Growth stocks, generally speaking, remained out of favor as evidenced by the 1.1% decline in the Russell 3000 Growth Index vs. the 0.1% gain in the Russell 3000 Value Index. Oil prices finished the day higher with the move attributed to reports Shanghai was planning to phase in business re-openings, thereby increasing demand expectations out of China. Including yesterday’s moves, here’s how the major market indicators stack up year-to-date:

  • Dow Jones Industrial Average: -11.32%
  • S&P 500: -15.91%
  • Nasdaq Composite: -25.45% 
  • Russell 2000: -20.57%
  • Bitcoin (BTC-USD): -35.26%
  • Ether (ETH-USD): -44.79%

Stocks to Watch

Before trading kicks off for U.S.-listed equities, Home Depot (HD), JD.com (JD), Kingsoft Cloud (KC), and Walmart are expected to report their quarterly results. 

United Airlines (UALshared that since it last provided guidance, the demand environment has continued to improve resulting in a higher unit revenue outlook for the current quarter. Offsetting that improvement, United shared its price of oil also continued to increase, resulting in a higher expected fuel price for the quarter as well. 

A week before it closes on the acquisition of Zynga (ZNGA)Take-Two (TTWOreported a March quarter that was decidedly mixed. While the company missed on net bookings for the March quarter, and guided net bookings for both the current and 2023 below consensus expectations, its March quarter EPS topped consensus forecasts.

AMN Healtcare (AMN) announced the acquisition of Connetics USA, an international nurse and allied recruitment company that specializes in nursing and allied professional direct hire recruitment and placements. The acquisition expands AMN’s International Staffing business and adds substantially more qualified professionals to its international pipeline of nurses and allied professionals.

AGCO (AGCO) announces its efforts to restore systems and business operations are continuing successfully following a ransomware cyber attack that was discovered on May 5 of this year. A majority of the affected production sites and parts operations resumed operational activities last week or today. The remainder of the sites are expected to begin operations during the balance of this week, such that all factories and parts operations are operating by the end of this week. AGCO expects to be able to mitigate the production loss from the ransomware cyber attack by increasing production over the remainder of 2022.


No new IPOs are expected to start trading this week. Readers looking to dig more into the upcoming IPO calendar should visit Nasdaq’s Latest & Upcoming IPOs page.

After Today’s Market Close

Doximity (DOCS), Mimecast (MIME), and NextGen Healthcare (NXGN) are slated to report their latest quarterly results. 

Investors should remain on watch for companies that pre-announce their March quarter results. Those looking for more on which companies are reporting when, head on over to Nasdaq’s Earnings Calendar

On the Horizon

Wednesday, May 18

  • Japan: GDP (Preliminary) – 1Q 2022
  • UK: CPI and PPI – April
  • Eurozone: CPI – April
  • US: Weekly MBA Mortgage Applications
  • US: Housing Starts – April 
  • US: Weekly EIA Crude Oil Inventories 

Thursday, May 19

  • US: Weekly Initial & Continuing Jobless Claims
  • US: Philadelphia Fed Index – May
  • US: Existing Home Sales – April 
  • US: Leading Indicators – April 
  • US: Weekly EIA Natural Gas Inventories 

Friday, May 20

  • Japan: CPI – April
  • Germany: PPI – April
  • UK: Retail Sales – April
  • Eurozone: Consumer Confidence – May

Thought for the Day

“If you’re not having doubt, you’re not pushing the boundaries far enough.” ~Tony Fadell


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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