• European bourses are rangebound with individual movers dominated by earnings; stateside, futures are modestly softer
• Amazon earnings beat on top and bottom lines after reporting a 44% increase in sales; +2% in pre-market
• USD is firmer but remains sub-91.00 with action largely confined to EUR & GBP into month-end with Japanese participants away on holiday
• Chinese official Manufacturing PMI and Non-Manufacturing PMI disappointed but remained in expansionary territory
• Looking ahead, highlights include US PCE & Chicago PMI, Fed's Kaplan
• Earnings from Exxon, Chevron, Phillips 66, AbbVie, Colgate-Palmolive

CORONAVIRUS UPDATE

US COVID-19 cases +52,528 (prev. +50,513), deaths +876 (prev. +555), total vaccines administered 237.36mln (prev. 237.05mln), those fully vaccinated 99.688mln (prev. 99.457mln). In relevant news, there were comments from New York Governor Cuomo that he would like NYC to fully reopen earlier than July. (Newswires)

UK PM Johnson is to be told next week that social distancing for large events can be scrapped as of June 21st after initial results from a pilot scheme found no spike in COVID cases among attendees. (Telegraph)

Mesoblast (MSB AT) announced 60-day results from its randomized controlled trial of REMESTEMCEL-L in ventilator dependent COVID patients which it stated reduced mortality through day 60 by 46% in patients below the age of 65yrs old with moderate/severe ARDS but not in those aged 65yrs and above. (Newswires)

France's Health Ministry announced they detected their first cases of the Indian COVID-19 variant, while there were separate reports on Thursday that China also detected cases of the Indian variant in some Chinese cities. (Newswires)

Japanese cabinet approved the use of JPY 500bln in reserve funds to support business impacted by pandemic and curbs, while Finance Minister Aso stated that the central government will disburse aid to regional governments. (Newswires)

Brazilian Senate approved a measure to suspend patent protection for vaccines, tests and medications during the COVID-19 pandemic. (Newswires)

ASIA

Asian stocks traded subdued after the momentum from yesterday’s intraday rebound and fresh record highs on Wall Street waned, with the region tentative on month-end and as participants digested an influx of earnings and mixed data releases, while an extended weekend for key markets in which Japan and China will remain closed through to Wednesday also contributed to the paring of risk. ASX 200 (-0.8%) declined with broad early pressure across all sectors. In addition, the recent pullback in copper from a decade high and announcement by ANZ Bank of a substantial impact to its H1 net also added to the sombre mood. Nikkei 225 (-0.8%) was dragged lower by currency inflows and amid an overload of recent earnings releases ahead of its 5-day closure but with losses stemmed following stronger than expected Industrial Production data and after the Japanese cabinet approved the use of JPY 500bln in reserve funds to support businesses impacted by pandemic and curbs. Hang Seng (-2.0%) and Shanghai Comp. (-0.8%) weakened heading into the Labor Day holidays for the mainland and amid a deluge of corporate results including the largest banks which were pressured after relatively tepid earnings growth amongst China’s big four banks although PetroChina was bolstered following a jump in earnings. There were also concerns regarding a crackdown on the tech sector after Chinese regulators warned of tighter oversight for its tech giants and ordered 13 firms to adhere to tighter regulation of data and lending practices, while markets also reflected on the latest Chinese PMI data in which official Manufacturing and Non-Manufacturing PMI disappointed but remained in expansionary territory and Caixin Manufacturing PMI topped estimates. Finally, 10yr JGBs were steady after the indecisiveness in T-notes and amid the lack of BoJ purchases in the market today, while the central bank also recently announced its bond buying intentions for May whereby it maintained the amounts and frequency of JGB purchases across all maturities.

PBoC injected CNY 10bln via 7-day reverse repos with the rate at 2.20% for a net neutral daily position. (Newswires) PBoC set USD/CNY mid-point at 6.4672 vs exp. 6.4651 (prev. 6.4715)

• Chinese Manufacturing PMI (Apr) 51.1 vs. Exp. 51.7 (Prev. 51.9)
• Chinese Non-Manufacturing PMI (Apr) 54.9 vs. Exp. 56.1 (Prev. 56.3)
• Chinese Composite PMI (Apr) 53.8 (Prev. 55.3)
• Chinese Caixin Manufacturing PMI (Apr) 51.9 vs. Exp. 50.8 (Prev. 50.6)
• Japanese Industrial Production (Mar P) M/M 2.2% vs. Exp. -2.0% (Prev. -1.3%)
• Japanese Industrial Production (Mar P) Y/Y 4.0% vs. -0.6% (Prev. -2.0%)
• Tokyo CPI (Apr) Y/Y -0.6% vs. Exp. -0.2% (Prev. -0.2%)
• Tokyo CPI Ex. Fresh Food (Apr) Y/Y -0.2% vs. Exp. 0.0% (Prev. -0.1%)
• Tokyo CPI Ex. Fresh Food & Energy (Apr) Y/Y 0.0% vs. Exp. 0.3% (Prev. 0.2%)

US

White House said US President Biden had a warm conversation with Republican Senator Capito and that they may meet in person soon on infrastructure, while they reaffirmed commitment to work out a strategy. (Newswires)

UK/EU

German Bundesbank Chief Economists says the economic recovery will likely be less strong due to the semiconductor shortages; expects the shortages to worsen somewhat in Q2. (Newswires)

Ireland Deputy PM Varadkar said we may need to consider free travel between UK and Ireland prior to opening up to wider international travel. (Newswires)

Spain is set to submit its EU recovery fund spending plans. (FT)

EU HICP Flash YY (Apr) 1.6% vs. Exp. 1.6% (Prev. 1.3%); X F&E Flash YY (Apr) 0.8% vs. Exp. 1.0% (Prev. 1.0%)

• X F,E,A&T Flash YY (Apr) 0.8% vs. Exp. 0.8% (Prev. 0.9%)
• GDP Flash Prelim QQ (Q1) -0.6% vs. Exp. -0.8% (Prev. -0.7%); YY (Q1) -1.8% vs. Exp. -2.0% (Prev. -4.9%)
• UK Lloyds Business Barometer (Apr) 29 (Prev. 15)

GEOPOLITICAL

Iranian delegation in Vienna says there are difficulties in JCPOA discussions and thus have not found a solution to the nuclear deal. (Newswires)

EQUITIES

Major bourses in Europe are again subject to lacklustre morning trade (Euro Stoxx 50 -0.1%), as newsflow remains quiet on month-end, and earnings take focus. State-side futures are subdued vs their counterparts across the pond, with relatively broad-based and modest downside experienced across peers. It's also worth noting that Japanese and Chinese players will be away from their desks next week until the 5th of May amid domestic holidays - thus overnight volume is likely to be low during the first half of next week. Back to Europe, Germany's DAX (+0.5%) narrowly outperforms regional peers after yesterday's underperformance coupled with some gains across large-cap stocks, albeit the breadth among European cash bourses remains narrow. In-fitting with the indecisive tone, sectors across Europe are mixed and again it is difficult to observe a particular theme given earnings distortions. The healthcare sector is the clear outperformer as AstraZeneca (+3.3%) soars post-earnings after side-lining reports that point to a delay in its vaccine's US FDA approval. On the flip side, the basic resources sector stands as the laggard amid a pull-back in base metal prices, whilst banks also reside towards the bottom of the pile as yields waned from yesterday's best levels and following corporate updates from Barclays (-4.7%), BNP Paribas (-1.0%) and BBVA (+0.9%), although the latter has nursed opening losses. Some attribute the downside in Barclays and BNP to sluggish fixed income trading performances vs rivals including JPM, Goldman Sachs and Deutsche Bank (+0.1%). Finally, Darktrace (+35%) shares were bolstered on their London debut whereby shares traded above GBP 3.50 at one point vs guided range GBP 2.20-2.80.

EU Antitrust Commissioner Vestager is to hold a presser at 12:00BST with Apple (AAPL) expected to be in focus; EU antitrust regulators have charged Apple (AAPL) with abusing the dominant market position in music streaming on the app store. Concerned about the mandatory use of the proprietary in-app purchase system with a 30% fee, says anti-steering provisions limits the ability of developers to inform users of alternative purchasing possibilities. (Newswires)

Amazon (AMZN) - Q1 2021 (USD): EPS 15.79 (exp. 9.55), Revenue 108.50bln (exp. 104.46bln). Q2 2021 Revenue view 110-116bln (exp. 108.60bln). AWS 13.50bln (exp. 13.09bln). Online Store 52.9bln (exp. 50.63bln). Click here for the full announcement. (Business Wire) Shares +2% in pre-market

Twitter Inc (TWTR) - Q1 21 (USD): Adj. EPS 0.16 (exp. 0.14), Revenue 1.04bln (exp. 1.03bln). Advertising rev. USD 899mln (exp. USD 897mln). Monetizable DAU 199mln (exp. 198.8mln). Co. sees Q2 rev. USD 980mln-1.08bln (exp. USD 1.05B). Co. noted significant pandemic-related surge we saw last year creates challenging comps and may lead to MDAU growth rates in the low double digits on a year-over-year basis in Q2, Q3, and Q4, with the low point in terms of growth likely in Q2. Click here for the full announcement. (PR Newswire) Shares -13% in pre-market

Please see the Daily European Equity Opening News and the Additional European Equity News headlines for the morning's European earnings

FX

USD/EUR/GBP - Only one day left for the Dollar to evade any residual month end selling, and so far so good as it continues to defy bearish rebalancing signals and the ongoing dovish overtones imparted by the Fed with some assistance from a back-up in yields and curve re-steepening. However, the Buck is also benefiting at the expense of others and a degree of consolidation or corrective price action approaching the end of a 4th successive week of depreciation. Looking at the DXY as a proxy, a marginal new recovery high from sub-90.500 lows in the index was forged at 90.822 after the Euro filled remaining bids in to 1.2100 and tripped a layer of stops on the back of weaker than forecast prelim German Q1 sa q/q GDP. However, Eur/Usd has found a base nearby and 2.1 bn option expiries at the round number could be keeping the headline pair underpinned alongside bids in the Eur/Gbp cross around 0.8700 that may be due to RHS fix and/or month end demand. Accordingly, Sterling is facing a task to retain grip of 1.3900 vs the Buck after topping out below yesterday’s 1.3975+ peak and failing to breach a double top against the Euro circa 0.8674, irrespective of Pound positives in the form of a super strong Nationwide UK house price survey and upbeat Lloyds business barometer.

AUD/CAD/JPY/NZD/CHF - All more rangebound and narrowly mixed vs their US counterpart, as the Aussie and Loonie continue to derive traction from recent rallies in metals and oil among other commodities like palladium hitting Usd 3k/oz for the first time ever. Aud/Usd is holding above 0.7750, while Usd/Cad is hovering around 1.2275 following a decline to new multi-year lows sub-1.2270 in the wake of last week’s hawkish BoC policy meeting. Elsewhere, the Yen is back above 109.00 with the assistance of greater Japanese participation for a session in between Showa Day and Golden Week market holidays, plus data on balance as ip confounded downbeat expectations and the unemployment rate fell against consensus for a steady print to offset weaker than anticipated Tokyo CPI. Back down under, the Kiwi is lagging between 0.7255-30 parameters in the absence of anything fresh on the NZ front and the Franc remains tethered to 0.9100 after a big base effect boosted Swiss retail sales in March and KoF’s leading indicator smashed forecasts in April.

SCANDI/EM - Although crude prices have come off the boil, the Nok is still comfortably above 10.0000 vs the Eur in stark contrast to the Sek that has slipped to fresh weekly lows near 10.17000, with traction from an unexpected decline in Norway’s jobless rate, a firmer credit indicator (albeit due to a back month revision) and steady Norges Bank daily foreign currency sales for next month (Nok 1.8 bn equivalent). Meanwhile, the firmer Usd bounce is taking its toll on almost all EM currencies, bar the resilient Cnh and Cny that are close to w-t-d pinnacles of 6.4607 and 6.4654 respectively regardless of somewhat disappointing Chinese official PMIs that were only partially compensated by a stronger Caixin manufacturing survey.

SNB's Chairman Jordan says negative rates and a willingness to intervene in FX markets seen as essential; CHF has weakened but remains highly valued. (Newswires)

Notable FX Expiries, NY Cut:

• EUR/USD: 1.2030-50 (1.4BLN), 1.2075 (690M), 1.2100 (2.1BLN), 1.2125 (600M), 1.2150 (985M)
• USD/JPY: 108.00-20 (900M), 108.50 (838M), 109.25-30 (1.1BLN)

FIXED

EU bonds have not been able to muster more impetus and gravity seems to be exerting more force following spirited attempts to claw back lost ground that propelled Bunds up to 170.12 and Gilts to 127.86. The former is back above 170.00, but still faces resistance in the form a 50% Fib retracement of yesterday’s fall from 170.64 on Eurex to 169.66, but the latter recently retreated to another new Liffe low at 127.63 and more in line with the weaker tone in US Treasuries. Still to come, the final blast of NA data for April, including some potentially key releases, like US PCE and the Chicago PMI plus Fed’s Kaplan.

COMMODITIES

WTI and Brent front-month futures trickle lower in early European trade as catalysts remain light and the tone across the market tentative. WTI, at the time of writing, has dipped back below USD 64.00/bbl (vs high USD 64.95/bbl) while its Brent counterpart hovers around USD 67.25/bbl (vs high USD 67.97/bbl). Barring any other macro headlines, the focus will be on the state of the Iranian nuclear talks - with cautious optimism expressed by the US and Iran, whilst others stated they expect a deal within weeks. That being said, commentary from the Iranian delegation has suggested there remain difficulties in discussions and a deal hasn't yet been reached. In case of any agreement, eyes will likely turn to the details surrounding the oil-related sanctions. Elsewhere, spot gold and silver are uneventful within recent ranges around USD 1,775/oz and on either side of USD 26/oz respectively. Spot palladium meanwhile has reached USD 3,000/oz for the first time with some citing a supply shortage. Turning to base metals, LME copper has waned back below USD 10,000/t ahead of the Chinese and Japanese holidays through to next Wednesday, whilst Chinese steel rebar and futures posted weekly gains amid an improved demand outlook.