OP Wire 5/28 (OP – Lite)

U.S. Stock Futures Rise as Investors Eye Key Inflation Data

U.S. stock futures edged into the green on Tuesday, with investors looking ahead to key inflation data during this holiday-shortened trading week. Stock markets on Wall Street were closed for Memorial Day on Monday.Highlighting the economic calendar this week is May’s personal consumption expenditures price index on Friday, widely known as the Federal Reserve’s preferred measure of inflation. Fed officials have recently suggested that they would like to see more proof that price gains in the U.S. are sustainably cooling toward the central bank’s stated 2% target before rolling out any potential interest rate cuts this year.

Consumer Confidence Data Ahead

A relatively light schedule of economic releases Tuesday will feature the latest reading of the Conference Board’s consumer confidence survey. Analysts expect the May figure, which is viewed as a potential leading indicator of consumer spending, to fall slightly to 96.0, down from 97.0 in the previous month. The number sank to its lowest level in more than 1-1/2 years in April as Americans fretted over elevated prices for essentials like food and gas, as well as income and the availability of jobs.”Confidence retreated further in April […] as consumers became less positive about the current labor market situation,” Dana Peterson, Chief Economist at the Conference Board, said in a statement.

Earnings Season Ebbs

The quarterly parade of earnings continues to slow, although several companies are still gearing up to unveil their latest returns in the coming days. Among them is Salesforce which will report following the close of markets on Wednesday. Analysts at Goldman Sachs expect the business software group to roughly meet Wall Street expectations, thanks in part to a recovery in spending by small- and medium-sized businesses.Elsewhere, members-only retailer Costco Wholesale Corp and beauty store chain Ulta Beauty are tipped to provide a further glimpse into the state of the U.S. shopper when they report after the bell on Thursday. Consumers have recently shown signs that they are paring back expenditures on nonessential items in response to sticky inflation and higher interest rates.

Alibaba Health Surges

Hong Kong-listed shares of Alibaba Health Information Technology (HK:0241) spiked on Tuesday after the firm reported a jump in its annual earnings on improved margins and strong demand for healthcare services and pharmaceuticals on its platforms. The company, which was acquired by e-commerce giant Alibaba Group in 2014, posted a nearly 91% surge in adjusted net profit to 1.44 billion yuan ($200 million) for the year ending March 31.

Last week, NQ managed to secure another week higher, ES closed flat. The main watch for the week was how price traded versus the 5333 level, which was the near-term volume point of control. We mentioned…given the recent expansion move, it should not be surprising to see price continue to take a breather (via consolidation) near the current spot.” ES closed the week flat as price continues to trade in a range-bound fashion.For this shortened week, the main watch will be how price continues to trade versus the current range, which can be defined by Thursday’s high and low. As always, then general rule of thumb when it comes to a break of a range is to watch for acceptance (continuation) outside of the range. The main level of interest for this week will be 5305. Continued action above 5305 can show a test of 5333 and 5350. Above 5350 would likely trigger a breakout, with the potential for continuation into 5395 and 5430. If price fails to hold above 5305, it would target 5274. Continuation below 5274 would trigger a breakdown with the potential for continuation into 5250 and 5220.Upside levels of interest: 5333, 5350, 5395, 5430Downside levels of interest: 5305, 5274, 5250, 5220

Notable Economic Data

All week: Fed Speak

Wednesday: Fed’s Beige Book

Thursday: GDP

Friday: PCE

$NLST- Desilva “Buy” rating and raised his price target on NLST from $2.00 to $4.00.

$PYPL- PayPal (PYPL) is planning to build an ad sales business around data generated from users and tracking purchases, and has hired former Uber (UBER) ad boss Mark Grether as PayPal Ads SVP, The Wall Street Journal’s Patrick Coffee reports. Grether will be responsible for developing new ad formats, overseeing sales and hiring staff to fill out the division, Coffee writes.

$AAPL- Apple’s iPhone shipments in China were up 52% in April vs. last year, Reuters’ Akash Sriram reports, citing data from a research firm affiliated the Chinese government. Apple’s shipments in China increased by 12% in March. 

$BA- JPMorgan analyst Seth Seifman lowered Q2 and 224 estimates for Boeing’s free cash flow following the company’s update at an investor conference last week. The reasons are fewer near term 737 and 787 deliveries combined with Boeing’s continued efforts to improve its production processes, the analyst tells investors in a research note. The firm says that despite the $4B cash outflow now expected for Q2, Boeing’s recent debt raise leaves the company “with plenty of cash.” Boeing has been unable to deliver aircraft to China recently while regulators there review the batteries that power cockpit voice recorders, notes JPMorgan. The firm keeps an Overweight rating on the shares with a $210 price target.

Hey OP. Hope you all had a great holiday weekend! Today I’ll be traveling and won’t be on much but I expect chop so patience should prove to be valuable! See you all in a few!

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