April Housing Starts at Seven-Year Highs

Economic Data

- (PT) Portugal Apr PPI M/M: 0.1 v 0.8% prior; Y/Y: -2.4 v -2.4% prior

- (BR) Brazil May IGP-M Inflation 2nd Preview: 0.4% v 0.4%e

- (US) Goldman Economist: Chain Store Sales w/e May 15th w/w: -1.2%; y/y: +2.3%

- (PL) Poland Apr Average Gross Wages M/M: -2.2% v -1.9%e; Y/Y: 3.7% v 3.9%e

- (PL) Poland Apr Employment M/M: 0.0% v 0.0%e; Y/Y: 1.1% v 1.1%e

- (US) Apr Housing Starts: 1.135M v 1.015Me; Building Permits: 1.143M v 1.064Me

- (US) Redbook Retail Sales w/e May 15th: +1.8% y/y, May MTD: -0.2%; May YTD: +2.0%

- (BR) Brazil May CNI Industrial Confidence: 38.6 v 38.5 prior

Continental European equity indices are up approximately 2% each this morning after a key ECB member said the ECB would front-load QE bond purchases. US 10-year yields are up five basis points on the session to trade around 2.285%. As of writing, the DJIA is down 0.06%, the S&P500 is off 0.12% and the Nasdaq is down 0.11%.

Comments by French ECB board member Coeurhave sent European stocks through the roof this morning. Coeur said the ECB would front-load its QE purchases because of the seasonal lack of liquidity in the summer, and asserted that the move was not a reaction to recent market conditions. Coeur also said the correction in yields did not bother him per se, but the rapidity of the change was somewhat concerning. EUR/USD continued yesterday's big reversal, with the pair dropping from around 1.1320 at the European open to as low as 1.1130 as of writing.

Warren Buffet's favorite US housing market indicator, housing starts, rose in April to its highest level since November of 2007. Starts jumped more than 20% sequentially to 1.135 million, for the biggest m/m gain in 25 years. Starts for single-family homes hit their highest level since January 2008. The data stood in stark contrast to yesterday's soft May NAHB index of homebuilder confidence. Major homebuilding stocks are seeing their second session of moderate gains.

Shares of retail titan Walmart are down nearly 4% after the firm missed revenue expectations in its first-quarter report. EPS was in-line, while comps were pretty soft and the firm's guidance for second quarter was subpar. Home Depot beat expectations and raised its FY forecast, however moderate gains in the stock are all but evaporated mid morning. TJX is up nearly 4% on a very good first-quarter report and raised FY guidance.

Looking Ahead

- 13:30 (MX) Mexico Central Bank (Banxico) Quarterly Inflation Report

- 16:30 (US) Weekly API Oil Inventories

- 19:50 (JP) Japan Q1 Preliminary GDP Q/Q: 0.4%e v 0.4% prior; GDP Annualized Q/Q: 1.6%e v 1.5% prior; GDP Nominal Q/Q: 1.5%e v 1.0% prior

- 23:00 (CN) China to sell 7-Year Bonds

- 23:00 (TH) Thailand to sell THB8.0B in 2044 Bonds