Stock futures pointed to a mostly higher open for Wall Street on Monday with a policy decision from the Federal Reserve later in the week potentially determining the direction for equities.

This week will feature two key central bank meetings, with the Bank of Japan seen likely to end its negative interest-rate policy on Tuesday, while the Federal Reserve could reduce its projection for interest-rate cuts this year on Wednesday.

Morgan Stanley said markets for now are looking past the rise in bond yields, that has seen the 10-year Treasury yield rise 44 basis points this year.

"From an equity standpoint, the rise in rates this year has not had the typical effect on valuations-i.e., P/E multiples have remained elevated in the face of rising rates," Morgan Stanley said.

"This informs us that, for now, equity investors appear to have moved past the Fed, inflation and rates and are now squarely focused on the better growth consensus expects to arrive this year."

Overseas Markets

Japan's Nikkei 225 jumped 2.7% ahead of the BoJ's policy decision while oher overseas markets broadly rose.

European stocks advanced, boosted by consumer-staple companies.

Premarket Movers

Alphabet saw its stock rise on a report from Bloomberg that Apple may license Google's Gemini AI engine and use it in the iPhone.

HashiCorp rose 12% after a report from Bloomberg said the software infrastructure company has been considering options including a sale. HashiCorp has been working with a financial adviser in recent months to gauge interest from potential buyers, Bloomberg reported, citing people with knowledge of the matter.

Nvidia's annual GTC conference begins on Monday and kicking things off will be a keynote address from CEO Jensen Huang. The company is expected to unveil some of its biggest products, including new AI offerings. The stock rose 2.1%.

Super Micro Computer joins the S&P 500 index before trading begins. Its shares was up 2.5%.

U.S.-listed shares of XPeng were up 7.1% after the Chinese electric-vehicle maker disclosed plans to launch a cheaper brand.

Friday's Post-Close Movers

Brand Engagement Network went public through a special-purpose acquisition company merger. Shares of rose 80%.

Molecular Templates said Bristol Myers Squibb decided to terminate their research collaboration. Shares fell 13%.

Economic Insight

The European Central Bank is more likely than the Federal Reserve to embark on sequential interest-rate cuts given prevailing growth differentials, J.P. Morgan Asset Management said.

JPM AM expects both the Fed and the ECB to start cutting interest rates in June, but the Fed is likely to proceed more gradually.

"Barring any major exogenous shocks, our base case is for the Fed to cut in June, and we expect a gradual cutting cycle thereafter given the current growth backdrop."

Given the eurozone is more susceptible to economic headwinds, "we think the ECB is more likely than the Fed to embark on sequential cuts given prevailing growth differentials."

Watch For:

Quarterly Financial Report; NAHB Housing Market Index; Canada Industrial, Raw Material Prices

Today's Headlines/Must Reads:

- American Manufacturers Seek Perfection as Quality Issues Mount

- The Fed's Challenge: Has It Hit the Brakes Hard Enough?

- Suspense Builds for Fed as Growth Downshifts and Inflation Lingers

- China Turns on the Charm for Foreigners but Its Allure Has Faded



Wage rise demands by Japan's largest trade union group are enough to merit a potential rate hike and end to the yield curve control by the Bank of Japan, which would lift the yen, NatWest Markets said.

NatWest has a long position in the yen, betting that it will rise ahead of the BOJ's decision, due on Tuesday.

NatWest is mindful that a rate hike could be accompanied by a cautious statement, however, and plans to review its tactical yen positions through the BOJ decision.

MUFG said the Bank of Japan's meeting might not be a decisive turning point in boosting the yen even if the central bank ends negative interest rate policy and yield curve control.

"The BOJ would have to signal more confidence that policy needs to be tightened further to trigger a stronger yen."

MUFG also said the Federal Reserve is likely to leave interest rates on hold on Wednesday but there is a possibility of it downgrading its interest-rate forecasts to two cuts this year rather than three, which would boost the dollar.

This potential switch "poses the main upside risk for the dollar in the week ahead should it encourage the U.S. rate market to further scale back Fed rate cut expectations," MUFG said, noting that it doesn't expect the forecasts to change.

"It would take just two participants to change from three cuts to two for the median dot to move."


Eurozone government bond yields were marginally lower but a bearish tone is expected this week in anticipation of central bank decisions, guidance and a busy supply schedule, Commerzbank Research said.

The bearish flattening bias-where short-term rates rise faster than long-term rates-in Treasurys and Bunds is likely to prevail ahead of the Bank of Japan, Federal Reserve and Bank of England meetings, alongside several more G10 central bank decisions and the European Central Bank Watchers Conference, Commerzbank said.

Government bond issuance volume is expected at around EUR34 billion this week, up from EUR21 billion last week.

Morgan Stanley Research said investors in Treasurys discounted cooling inflation, and chose to focus on strong growth, adding it sees room for yields to correct lower.

Since mid-2023, inflation started cooling meaningfully, while growth stayed strong and the optics of the labor market looked good, Morgan Stanley said.

It suggests that 10-year yields could have been around 3.60% if markets had focused on supply-side gains and inflation progress.


Oil prices continued to rise after hitting a four-month high last week, with investors turning their focus on a string of key central banks meetings this week.

Gains were boosted by a new wave of Ukrainian attacks against Russia, which sparked a fire at an oil refinery and disrupted some electricity supplies, as well as strong refining activity in some major Asian countries further buoying market optimism, according to ING.


Gold and base metals were lower as concerns weighed about the timing of interest rate cuts ahead of Wednesday's Fed meeting.

Swissquote Bank said the FOMC will enter the meeting having seen a two-month jump in inflation, healthy jobs data, above-average economic growth and robust corporate earnings, and there's a chance it will plot fewer rate cuts for the year as a result.

Uranium prices may have pulled back recently but Jefferies thinks fundamental drivers of the commodity remain positive.

Spot uranium prices have fallen some $24/lb since peaking at $107/lb on Feb. 5, reflecting low volumes being made available to buyers.

"Producers remain short pounds, financial buyers continue to underpin demand, and the longer-term demand outlook remains positive," Jefferies said.

"We anticipate a volatile market, but with a broader upward price trend."


Logitech Shares Drop After CFO Departure

Logitech International shares plummeted after it said that its chief financial officer Charles 'Chuck' Boynton resigned to pursue another career opportunity.

The Swiss accessories maker said Monday that Boynton, who became Logitech CFO in 2023, will remain with the company through mid-May, while a successor will be named at a later date, the company said.

BofA Securities, UBS in Lead to Secure Mandate for KKR's Philippines Hospital Stake Sale

BofA Securities and UBS have emerged as front-runner banks to secure a mandate from private-equity firm KKR to conduct the sale of its stake in a Philippines-based hospital business, with the overall business valued at between $2.5 billion and $3.0 billion, people familiar with the process said.

KKR is expected to start a formal sale process soon for Metro Pacific Healthcare, the largest private hospital group in the Philippines, one of the people said.

Nelson Peltz Fights Disney-and Turmoil at His Own Fund

Nelson Peltz's hedge fund had a problem. A few years ago, investors in Trian Partners were yanking hundreds of millions of dollars after its performance had soured.

Around the same time, Peltz's son, Matt, and others at the firm were eyeing a big bet on one of the most high-profile targets imaginable, Disney. They had watched the media giant's stock plummet as it poured billions into its new streaming service.

ESPN Boss Jimmy Pitaro's Chaotic Race to Remake the Sports Giant

ESPN boss Jimmy Pitaro was keeping a big secret.

In January, Pitaro and executives at ESPN-parent Disney hosted a contingent of top NFL officials-including Commissioner Roger Goodell, and team owners Robert Kraft and Jerry Jones-at Disney's Burbank, Calif., headquarters to discuss a potential deal.

TikTok's American Growth Is Already Stalling

As TikTok fends off a new attack by Congress, it is also battling headwinds that have sapped its U.S. business of its mojo.

For the first time in TikTok's history, its user growth is stagnating, according to people familiar with the matter. Ad sales are hitting growth targets but not exceeding them, and it is at war with the world's largest music company. Its bet on e-commerce as a new revenue source has angered some users by muddying the app's stream of short videos. And TikTok's main competitor, Instagram Reels, has been gaining ground.

China's Economy Has a New Problem: Its Job Market

SINGAPORE-China's economy has a new problem: Rising unemployment.

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03-18-24 0614ET