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Wall Street closed lower on Friday as investors assessed a mixed bag of economic data against big bank first quarter earnings results. Retail sales data for March was released in the US late last week showing a 1.2% decline for the month compared to expectations of a 0.4% drop. Despite this reading, unfavourable results from consumer sentiment and industrial production data add further support for the Fed to raise the nation’s cash rate by 25-basis points at the next FOMC meeting. The Dow Jones industrials index fell 0.42%, the S&P500 lost 0.21% and the tech-heavy Nasdaq fell 0.35%.

Big banks began releasing first quarter results on Friday with BlackRock (ASX:BKT) rising 3% after beating profit expectations, alongside Citigroup, and JPMorgan rallying on bumper earnings results that also beat expectations. Earnings reports being released by the banks enters full swing this week so we can expect the markets to move accordingly based on how well the big banks performed in the first quarter, especially in the wake of the regional banking crisis earlier this month.

Over in Europe, markets ended the final trading session of the week higher, led by a rise in the banking sector after JPMorgan Citigroup and Wells Fargo beat estimates for the first quarter and ahead of earnings season this week for the big banks. The STOXX600 rose 0.53%, Germany’s DAX rose half a percent, the French CAC added 0.52% and, in the UK, the FTSE100 rose 0.36%.

The local index closed 0.51% higher on Friday after a turbulent session on Thursday following the release of unemployment data showing the country’s unemployment rate remains ultra-low at 3.5%, in a sign for the RBA to continue its rate hike journey in May after April’s pause. Investor sentiment was lifted on Friday though by a rally for materials stocks amid a rise in commodity prices and demand outlook, while financials stocks were lifted by strong earnings results out of some big banks in the US.

What to watch today:

• Ahead of the local trading session the SPI futures are anticipating the ASX to open 0.16% higher to start the new trading week on a positive note.
• On the commodities front this morning oil is trading 0.44% higher at US$82.52/barrel, gold is down 1.75% at US$2004/ounce and iron ore is flat at US$120/tonne.
• There is no local economic data released today however investors will be eagerly awaiting the release of the RBA’s meeting minutes for April out tomorrow to gain an insight into how the RBA are thinking about future rate hikes to tackle Australia’s current level of inflation.
• Stocks trading ex-dividend today include New Hope Corporation (ASX:NHC). If you’ve been thinking about this coal mining stock, it might be worth considering buying in today as stocks trading ex-dividend generally trade lower on the ex-dividend date.

Trading Ideas:

• Bell Potter has downgraded its rating on Breaker Resources (ASX:BRB) from a buy to a sell and has downgraded the price target from $0.62 to $0.53 following the receipt of a takeover offer from Ramelius Resources that has been unanimously recommended by Breaker’s board and major shareholders to accept the offer. The takeover offer is worth $130.7m and implied a share price offer of $0.40/share at the time of the all-scrip takeover offer being received.
• Trading Central have identified a bullish signal on ARB Corporation (ASX:ARB) following the formation of a pattern over a period of 76-days which is roughly the same amount of time the share price may rise from the close of $32.61 to the range of $40.25 to $42.00 according to standard principles of technical analysis.