The latest report by IHS Markit revealed on Wednesday the seasonally adjusted IHS Markit final U.S. Manufacturing Purchasing Managers’ Index (PMI) stood at 49.8 in June, up from May’s reading of 39.8 and slightly higher than the earlier released “flash” reading of 49.6. The reading signaled only a fractional deterioration in U.S. manufacturing conditions as goods producers and their customers began to reopen amid looser restrictions following the outbreak of COVID-19.

Economists had forecast the index to stay unrevised at 49.6.

According to the report, the downward trend in production eased markedly in June as new orders stabilized amid reports of relative improvement in demand conditions. At the same time, employment across the manufacturing sector dropped for the fourth month running in June. However, the overall loss of jobs was considerably weaker than those seen in the prior two months. Optimism about the year ahead meanwhile revived considerably amid hopes of a sustained pick-up in client demand and an end to the pandemic.

Chris Williamson, Chief Business Economist at IHS Markit noted: “While the PMI currently points to a strong v-shaped recovery, concerns have risen that momentum could be lost if rising numbers of virus infections lead to renewed restrictions and cause demand to weaken again.”

U.S. stock-index futures edged up on Wednesday as coronavirus vaccine news and encouraging ADP employment report outweighed concerns that the latest surge in coronavirus infections in the U.S. could trigger fresh lockdowns and derail a nascent economic recovery.

Global Stocks:

(company / ticker / price / change ($/%) / volume)

Deere (DE) resumed with a Buy at Deutsche Bank; target $186

UnitedHealth (UNH) resumed with an Outperform at SVB Leerink; target $360

Caterpillar (CAT) upgraded to Buy from Hold at Deutsche Bank; target $166

FedEx (FDX) upgraded to Overweight from Neutral at JP Morgan; target raised to $188

FXStreet reports that analysts at Credit Suisse note that the S&P 500 holds above the 200-day average at 3021 and the break above the short-term 13-day exponential average reasserts a near-term upward bias in the broader high-level consolidation range with next resistance awaiting at 3115.

“S&P 500 remains above key support from its 200-day average and the break back above its short-term 13-day average yesterday is seen reinforcing the view the market has settled in a high-level consolidation range.”

“Support is seen at 3085/81 initially, then 3067 and whilst above here the immediate risk is seen higher in the range with next resistance seen at its recent price gap, starting at 3115 and stretching up to 3127/31. This latter area is seen as the barrier to a retest of the highs past two weeks at 3153/56.” 

“Below 3067 can see a move back lower in the range with support seen next at 3050/48. This is seen as the trigger to a retest of the 200-day average, currently seen at 3022.”

FedEx (FDX) reported Q4 FY 2020 earnings of $2.53 per share (versus $5.01 per share in Q4 FY 2019), beating analysts’ consensus estimate of $1.62 per share.

The company’s quarterly revenues amounted to $17.358 bln (-2.5% y/y), beating analysts’ consensus estimate of $16.536 bln.

FDX rose to $154.04 (+9.86%) in pre-market trading.