Indices worldwide rallied off of better-than-expected economic data. Japanese large manufacturers recorded a reading of 4 on the June Tankan survey, as was expected. This reading is significantly better than the -8 recorded in March, and it’s the first time a positive number was reported since September 2011. The Japanese Nikkei 225 climbed 1.28% on the day. Great Britain’s manufacturing report topped estimates with a reading of 52.5. The FTSE 100 finished the day up 1.49%.
Markit’s US PMI came in slightly worse than expected with a reading of 51.9 against the 52.3 expected. The ISM national manufacturing report topped estimates and last month’s number, coming in at 50.9 versus the 50.5 expected. This was an increase from the prior month’s contractionary reading of 49.5. Most of the report’s subindexes showed stronger growth in production, new orders, and inventories, but a sharp decline in employment was the one sore spot. Construction spending grew less than expected in May with month-over-month gains of 0.5% vs the 0.6% estimate.
The S&P 500 finished the day up 0.55% to 1,615 The SPDR S&P 500 Homebuilders ETF (XHB) outperformed the market, finishing the day up 1%. Gold and copper rallied on the day, while silver lagged the other precious metals. Gold finished the day up more than 2%, copper climbed more than 3%, and silver finished slightly in the red. The 10-year yield finished the day down 1 basis point to 2.49%.
Shares of Onyx Pharmaceuticals (ONXX) traded up 51% on the day after receiving a $120 tender offer from Amgen (AMGN). The company declined the offer and is currently shopping for other potential suitors. Wall Street analysts from Deutsche Bank and Lazard viewed the fair value of Onyx at between $130 and $148 per share.
Best Buy (BBY) shares rose 9% on the day after Credit Suisse (CS) reiterated its outperform rating.
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