US Stocks struggled for traction on Wednesday as market participants were concerned about the future path of interest rates, amid a strong set of corporate earnings reports. The S&P 500 ended mostly muted, the Nasdaq edged up by 0.1% while the Dow Jones closed 0.1% lower. Long-dated Treasury yields were sharply higher ahead of a fresh increase in debt supply by Washington, tightening financial conditions and pressuring demand for riskier equities. In earnings news, Tesla surged 12% after announcing plans to ramp up production and introduce more affordable models, offsetting its weaker-than-expected quarterly results. Visa rose 0.3%, Texas Instruments climbed 5.6%, and AT&T gained 1.8% after reporting upbeat results. However, Boeing's stock fell 2.9% after the company reported its first quarterly revenue decline in seven quarters, despite beating analyst expectations. After the closing bell, Meta, IBM, and Ford were among the companies set to report their quarterly results.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($766,550 or less) rose by 11bps to 7.24% in the week ended April 19th, 2024, reaching the highest level since the last week of November, according to data from the Mortgage Bankers Association. Mortgage rates have now risen for three consecutive weeks by a total of 33bps, tracking the upward movement of Treasury yields, driven by traders adjusting their expectations for Federal Reserve rate cuts. Meanwhile, the rate for jumbo loans, or the 30-year mortgage for homes sold for over $766,550, rose to 7.45% from 7.4%. The average rate for a 30-year mortgage backed by the Federal Housing Administration was 7.01%, up from 6.9% a week ago.

The Ifo Business Climate indicator for Germany rose to 89.4 in April 2024, marking the third consecutive month of increases and surpassing market expectations set at 88.9. Sentiment toward Europe's largest economy soared to its highest level since May 2023, driven by growing anticipation of potential interest rate cuts by the European Central Bank and a gradual alleviation of inflationary pressures. Companies were less pessimistic regarding the forthcoming months (89.9 vs 87.7 in March), while their assessment of the current business situation also showed a less gloomy stance (88.9 vs 88.1). Breaking down the data by industry, sentiment improved among manufacturers (-8.5 vs -9.9), service providers (+3.2 vs +0.4), traders (-22.0 vs -22.9), and constructors (-28.5 vs -33.2).

Crude oil inventories in the US fell by 6.368 million barrels in the week ended April 19, 2024, the most since January and against market expectations of a 1.6 million increase, data from the EIA Petroleum Status Report showed. Crude stocks at the Cushing, Oklahoma, delivery hub went down by 659 thousand barrels, after a 33 thousand barrel increase. Meanwhile, gasoline stocks went down by 0.634 million, less than forecast of a 1.4 million draw; and distillate stockpiles, which include diesel and heating oil, increased by 1.614 million barrels, versus consensus for a 0.9 million decline.

The US 10-year Treasury note yield rose to 4.65%, approaching five-month highs of 4.66% seen earlier in the week as traders digest key economic data and adjust their expectations for the Fed's rate cuts. Durable goods orders rose more than expected in March, led by new autos and passenger planes, but outside transportation, orders barely rose. S&P Global PMIs released Tuesday indicated a surprise slowdown in private sector activity, with manufacturing PMI dropping to a four-month low. Focus is now on the advance GDP growth estimate and PCE inflation data, ahead of the Fed's upcoming monetary policy decision next week. Most investors anticipate the first fed funds rate cut to occur in September. A successful auction of $69 billion in two-year notes signaled strong demand from investors, with additional sales of five- and seven-year notes planned for this week by the Treasury.

Retail sales in Canada likely remained unchanged over a month in March 2024, according to preliminary data. Considering February, retail sales fell by 0.1% from the earlier month, contrasting with an earlier estimate of a 0.1% uptick and following a 0.3% decrease in the prior month. Market analysts had expected a 0.1% gain. Sales were down in five of nine subsectors and were led by decreases at gasoline stations and fuel vendors (-2.2%). Core retail sales, which exclude gasoline stations and fuel vendors and motor vehicle and parts dealers, were unchanged in February. Retail sales decreased in seven provinces in February, with the largest decline observed in Alberta (-1.1%), led by lower sales at motor vehicle and parts dealers. On a yearly basis, retail activity rose by 1.2% in February, after a 0.9% increase in the prior month.