Barchart Morning Call 10/30

Barchart Morning Call BC - 1 hr 14 mins ago Overnight Developments Dec E-mini S&Ps this morning are slightly higher by +0.05% from last Friday's close, which is an improvement from Monday's close of down -0.3% from last Friday's close. E-mini S&Ps are getting a boost from today's 1.06% rally in European stocks, which rallied on positive earnings results from BP and Deutsche Bank. European stocks were also supported by successful Italian 5-year and 10-year bond auctions and shook off disappointing German unemployment and Eurozone confidence index news. Japanese stocks fell -0.98% today despite the BOJ's expansion of its asset-purchase program as the market was disappointed by the weak Japanese industrial production report. Hong Kong stocks closed -0.38% but Chinese stocks closed slightly higher by +0.18%. The dollar index today is down -0.28 (-0.35%) on the higher trade in European stocks and E-mini S&Ps. EUR/USD is up +0.40% while USD/JPY is down -0.41%. Dec 10-year T-note prices are down -2 ticks. Commodity prices are up +0.60% today with Dec crude oil up +0.76%, Dec gasoline +0.37%, Dec gold +0.39%, Dec copper up +1.06%, and agriculture prices trading mostly higher. German Oct unemployment rose by +20,000, which was a worse report than expectations of +10,000 and up from September's revised +12,000 (prelim +9,000). The German Oct unemployment rate of 6.9% was in line with market expectations, but the Sep rate was revised higher to 6.9% from 6.8%. The Eurozone confidence indexes were mixed compared with expectations but all of the indexes fell from September. The Eurozone Oct business climate indicator fell to -1.62 from -1.34% in September and was weaker than market expectations of -1.38. The Eurozone Oct economic confidence index of 84.5 fell from a revised 85.2 in September but was slightly stronger than market expectations of 84.4. The Oct industrial confidence index of -18.0 was down from a revised -15.9 in September and was weaker than market expectations of -17.0. The Oct services confidence index of -12.1 was stronger than market expectations of -12.8 but was down from a revised -11.9 in September. Italy today successfully sold 3 billion euros of 10-year bonds at 4.92%, which was the lowest since May 2011 and down from September's auction yield of 5.24%. Italy also successfully sold 4 billion euros of 5-year bonds at 3.80%, down from last month's 4.09%. The bid cover ratios improved to 1.43 from 1.33 in September for the 10-year and to 1.43 from 1.33 in September for the 5-year. Italy's benchmark 10-year yield this morning is down 4 bp at 4.97%. Spain's Q3 GDP fell -0.3% q/q and -1.6% y/y, which was a smaller decline than market expectations of -0.4% q/q and -1.7% y/y. Japan's Sep industrial production report of -4.1% m/m and -8.1% y/y was weaker than market expectations of -3.1% m/m and -7.1% y/y and was weaker than August's report of -1.6% m/m and -4.6% y/y. Separately, Sep vehicle production fell -12.4% y/y from +4.5% y/y in August. The Bank of Japan at its 2-day policy meeting that concluded today announced an 11 trillion yen ($138 billion) increase in its asset-purchase program to 66 trillion yen. The action was in line with market expectations. The BOJ at its September 19 meeting increased its asset purchase program by 11 trillion yen, meaning the BOJ raised its asset purchase target in back-to-back meetings. As an example of the political pressure that the BOJ is feeling from the government, Economy Minister Seiji Maehara attended today's BOJ meeting for the second time. Market Comments Dec E-mini S&Ps this morning are trading at 1408.25, which is up slightly by +0.05% from last Friday's close and better than Monday's last trade of down -0.3% from last Friday's close. E-mini S&Ps have shaken off the poor Japanese industrial production report and focused on the 1.06% rally in European stocks. CME equity index futures close early today at 9:15 AM ET since the NYSE and the other U.S. stock markets are closed. Dec E-mini S&Ps on Monday closed early at 9:15 AM ET due to Hurricane Sandy and at the close were down 4.75 (-0.3%) at 1402.75. The NYSE, Nasdaq and the other stock exchanges were closed on Monday. Friday's closes: S&P 500 -0.07%, Dow Jones +0.03%, Nasdaq 100 +0.31%. E-mini S&Ps saw weakness on Monday due to continued concerns about global growth and poor corporate revenue and earnings, increased worries about Europe with former Prime Minister Berlusconi threatening to withdraw support from the Monti government and force a new election, and a 0.8% sell-off in European stocks. Dec 10-year T-notes this morning are down 2 ticks. Dec 10-year T-note prices on Monday closed mildly higher on increased safe-haven demand with Monday's lower global stocks and the impending damage from Hurricane Sandy: TYZ2 +7, FVZ2 +2.25. CBOT interest rate futures markets closed early at noon ET on Monday in line with the early close in cash Treasuries. The dollar index this morning is mildly lower by -0.28 (-0.35%) on reduced safe-haven demand with the rally in European stocks and the slightly higher trade in E-mini S&Ps. EUR/USD is up +0.0052 (+0.40%). USD/JPY is down -0.33 (-0.41%). The yen rallied despite today's BOJ easing move since it was fully expected. The dollar index on Monday closed mildly higher: Dollar index +0.16 (+0.20%), EUR/USD -0.00034 (-0.26%), USD/JPY +0.15 (+0.19%). The dollar index received a boost from safe-haven demand on weak U.S. and European stocks and the impending damage from Hurricane Sandy. EUR/USD was undercut by the threat by former Prime Minister Berlusconi to withdraw his party's support for the Monti government, which would result in early elections and possible political chaos. In addition, Eurozone officials are having trouble figuring out how to cover the 20-30 billion euro hole in Greece's deficit outlook without going back to national legislatures for a bigger bailout package. Dec WTI crude oil prices this morning are up +0.65 (+0.76%) and Dec gasoline is up +0.0097 (+0.37%). Dec crude oil and gasoline prices on Monday settled lower: CLZ2 -0.74 (-0.86%), RBZ2 -0.0006 (-0.02%). Dec crude oil prices fell on the mildly higher close in the dollar and on general commodity weakness and technical selling. Gasoline prices ran into buy-the-rumor, sell-the-fact selling as Hurricane Sandy came ashore. Gasoline prices rallied last week on expectations for refinery disruptions in the Northeastern U.S. from Hurricane Sandy as well as disruptions to petroleum shipments in and out of NY Harbor. For the complete subscription version of this daily report (plus a 13-page big-picture weekly report), along with the earliest possible delivery in the morning, please visit http://www.barchart.com/register/crbfms_usmc.php Today's U.S. Earnings Reports Earnings reports (ranked by market cap): F-Ford (Consensus:$0.30), AGN-Allergan (1.04), WMB-Williams (0.27), ECL-Ecolab (0.87), HCP-HCP Inc (0.47), WPZ-Williams Partners (0.55), CMI-Cummins (1.83), ADM-Archer Daniels (0.43), JCI-Johnson Controls (0.75), VLO-Valero Energy (1.79), WM-Waste Management (0.60), CAH-Cardinal Health (0.79), OKS-Oneok Partners (0.71), STX-Seagate Technology (1.66), WU-Western Union (0.45), DVA-Davita (1.55), FISV-Fiserv (1.27), DLPH-Delphi Automotive (0.73), OKE-Oneok (0.32), EQIX-Equinix (0.59), AMTD-TD Ameritrade (0.25), PNR-Pentair (0.63), CIE-Cobalt (-0.10), VRSK-Verisk Analytics (0.50), KIM-Kimco Realty (0.06), YNDX-Yandex (0.19). Global Financial Calendar Tuesday 10/30/12 United States 0745 ET ICSC (Int'l Council of Shopping Centers) weekly retailer sales. 0855 ET Redbook weekly retailer sales. 0900 ET Aug Case-Shiller Composite-20 house price index expected +0.5% m/m and +1.9% y/y, July +0.4% m/m and +1.2% y/y. 1000 ET Oct U.S. consumer confidence (Conference Board) expected +2.7 to 73.0, Sep +9.0 to 70.3. 1130 ET Weekly 4-week T-bill auction. 1230 ET New York Fed President William Dudley speaks on regional and national economic conditions at an event in Connecticut. 1630 ET API weekly U.S. oil statistics. 2000 ET Minneapolis Fed President Narayana Kocherlakota speaks at public town hall meeting at the University of Minnesota-Duluth. Japan n/a 2-day BOJ meeting concludes. 0000 ET Japan Sep vehicle production, Aug +4.5% y/y. 1915 ET Japan Oct Markit/JMMA manufacturing PMI, Sep 48.0. 2130 ET Japan Sep labor cash earnings expected -0.4% y/y, Aug unch y/y. Germany 0455 ET German Oct unemployment rate expected +0.1 to 6.9%, Sep 6.8%. Oct unemployment change expected +10,000, Sep +9,000. Euro-Zone 0600 ET Eurozone Oct business climate indicator expected -1.40, Sep -1.34. Oct Eurozone final consumer confidence, previous -25.6. Oct economic confidence expected 84.4, Sep 85.0. Oct industrial confidence expected -17.0, Sep -16.1. Oct services confidence expected -13.0, Sep -12. United Kingdom 0700 ET UK Oct CBI reported sales expected 8, Sep 6. 2001 ET UK Oct GfK consumer confidence survey expected unch at -28, Sep -28. Barchart.com provides Financial Quotes, Charts and Technical Analysis for Stock and Commodity Traders.