Thursday, September 12th, 2013View Older Reports
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OVERNIGHT MARKETS AND NEWS
September E-mini S&Ps (ESU13 unch) this morning are down -0.09% and European stocks are down by -0.17% after industrial output in the Eurozone fell by the most in 10-months. Asian stocks closed mixed: Japan -0.26%, Hong Kong +0.07%, China +0.99%, Taiwan +0.20%, Australia +0.16%, Singapore +0.41%, South Korea -0.02%, India -1.08%. Japanese stocks fell after Japanese core machinery orders, a proxy of future capital spending, unexpectedly stagnated in July, while China's Shanghai stock index rose to a 3-month high after Chinese Premier Li Keqiang said that China will push forward interest-rate and exchange-rate reforms and the internationalization of the yuan. Commodity prices are mixed. Oct crude oil (CLV13 +0.80%) is up +0.86% and Oct gasoline (RBV13 +1.50%) is up +1.42% after the Israeli army reported that two shells fired from Syria hit the southern Golan. Dec gold (GCZ13 -1.68%) is down -1.58% at a 4-week low on expectations for the Fed to taper QE at next week's FOMC meeting and Dec copper (HGZ13 -1.37%) is down -0.97% after Eurozone industrial production fell more than expected. Agricultural and livestock prices are mixed ahead of the Sep WASDE crop production report later this morning. The dollar index (DXY00 +0.01%) is up +0.02%. EUR/USD (^EURUSD) is down -0.12% and USD/JPY (^USDJPY) is down -0.53%. December T-note prices (ZNZ13 +0.18%) are up +7.5 ticks.Eurozone July industrial production fell -1.5% m/m and -2.1% y/y, weaker than expectations of -0.3% m/m and -0.2% y/y, with the -1.5% m/m decline the biggest monthly drop in 10-months.
The German Aug wholesale price index fell -0.6% m/m, the sixth consecutive month wholesale prices have fallen, and dropped -1.7% y/y, the biggest annual decline in 3-3/4 years.
Japan July machine orders were unch m/m and +6.5% y/y, weaker than expectations of +2.4% m/m and +7.7% y/y.
U.S. STOCK PREVIEW
Today’s weekly initial unemployment claims report is expected to show an increase of +7,000 to 330,000, reversing part of last week’s decline of -9,000 to 323,000. Meanwhile, continuing claims are expected to rise +9,000 to 2.960 million, more than reversing last week’s decline of -43,000 to 2.951 million. The Treasury today will sell $13 billion in 30-year T-bonds, concluding this week’s $66 billion coupon package. There are two of the Russell 1000 companies that report earnings today: Kroger (consensus $0.60), and Ulta Salon (0.67).Equity conferences during the remainder of this week include the following: UBS Global Paper & Forest Products Conference on Thu, UBS Best of Americas Conference on Thu-Fri, Bank of America Merrill Lynch Global Real Estate Conference on Wed-Fri, Bank of America Merrill Lynch Healthcare Conference on Wed-Thu, Goldman Sachs Global Commodities Conference on Wed-Thu, Bank of America Merrill Lynch Media, Communications & Entertainment Conference on Wed-Thu, Barclays Capital CEO Energy - Power Conference on Wed-Thu, Barclays CEO Energy Power Conference on Wed-Thu, CL King & Associates Inc Best Ideas Conference on Wed-Thu, Bank of America Merrill Lynch Canada Mining Conference on Thu, and Bloomberg Canadian Fixed Income Conference on Thu.
OVERNIGHT U.S. STOCK MOVERS
Halliburton (HAL -0.26%) was downgraded to "Neutral" from "Outperform" at Macquarie.lululemon (LULU -1.50%) slipped over 9% in pre-market trading after it reported Q2 EPS of 39 cents, better than consensus of 35 cents, but then lowered guidance on fiscal 2013 EPS view to $1.94-$1.97, below consensus $1.99.
Wendy's (WEN +0.73%) was upgraded to "Buy" from "Hold" at Argus.
Symantec (SYMC +0.12%) was downgraded to "Equal Weight" from "Overweight" at Morgan Stanley.
Men's Wearhouse (MW -0.62%) slumped over 10% in after-hours trading after it reported Q2 EPS of $1.01, well below consensus of $1.14, and then lowered guidance on fiscal 2013 EPS view to $2.40-$2.50 from $2.70-$2.80, below consensus of $2.77.
As of the September 20 close, Ametek (AME +0.41%) and Vertex (VRTX -1.86%) will be added to the S&P 500, while AMD (AMD -1.29%) and SAIC (SAI +2.07%) will be deleted and added to the S&P 400.
Billionare investor Carl Icahn said he bought more Apple (AAPL -5.44%) stock Wednesday as the price fell and that he likes the Netflix (NFLX -1.52%) model and has not sold his shares.
Qualcomm (QCOM -2.85%) announced a new $5 billion share repurchase program.
Royal Caribbean (RCL +1.28%) raised its quarterly dividend to 25 cents per share from 12 cents per share.
Vera Bradley (VRA +2.53%) tumbled 11% in after-hours trading after reported Q2 EPS of 37 cents, better than consensus of 32 cents, but then lowered guidance on fiscal 2014 EPS view to $1.47-$1.52 from $1.74-$1.78, below consensus of $1.71.
MARKET COMMENTS
Sep E-mini S&Ps (ESU13 unch) this morning are down -1.50 points (-0.09%). The S&P 500 index on Wednesday climbed to a 4-week high and closed higher. Bullish factors included (1) reduced threats of a U.S. military strike against Syria after President Obama asked Congress to delay a vote authorizing the use of military force while the administration pursues Russia's proposal that Syria gives up its chemical weapons, and (2) improved global economic prospects after the UK July unemployment rate unexpectedly fell to a 4-year low of 7.7%. Closes: S&P 500 +0.31%, Dow Jones +0.89%, Nasdaq 100 -0.16%.Dec 10-year T-notes (ZNZ13 +0.18%) this morning are up +7.5 ticks. Dec 10-year T-note prices on Wednesday shed early losses and closed higher on strong demand for the Treasury's $21 billion 10-year T-note auction that had a bid-to-cover ratio of 2.86, higher than the 12-auction average of 2.78. Prices had traded lower early on reduced safe-haven demand as the threat of any U.S. military strike against Syria faded when President Obama asked Congress to delay a vote on authorizing military force against Syria. Closes: TYZ3 +14.50, FVZ3 +9.75.
The dollar index (DXY00 +0.01%) this morning is up +0.014 (+0.02%). EUR/USD (^EURUSD) is down -0.0016 (-0.12%) and USD/JPY (^USDJPY) is down -0.53 (-0.53%). The dollar index on Wednesday slipped to a 1-1/2 week low and closed lower. The dollar retreated on reduced safe-haven demand after President Obama postponed a decision on military attacks on Syria. Another negative for the dollar was the rally in the British pound to a 7-month high against the dollar after the UK unemployment rate unexpectedly fell to a 4-year low. Closes: Dollar index -0.303 (-0.37%), EUR/USD +0.00435 (+0.33%), USD/JPY -0.49 (-0.49%).
Oct WTI crude oil (CLV13 +0.80%) this morning is up +93 cents (+0.86%) and Oct gasoline (RBV13 +1.50%) is up +0.0385 (+1.42%). Oct crude oil and gasoline prices on Wednesday settled mixed. A slide in the dollar index to a 1-1/2 week low boosted crude, while Oct gasoline tumbled to a 1-month low after weekly EIA gasoline stockpiles unexpectedly rose +1.658 million bbl, higher than estimates for a -1.0 million bbl decline. Another bearish factor for crude was the +1.6% increase in U.S. crude production in the week ended Sep 6 to a new 23-3/4 year high of 7.745 million barrels a day. Also, crude prices were pressured as the risk of a U.S. military strike in Syria receded when President Obama postponed a decision on military attacks on Syria. Closes: CLV3 +0.17 (+0.16%), RBV3 -0.0235 (-0.86%).
GLOBAL EVENT CALENDAR09/12/2013
| US | 0830 ET | Weekly initial unemployment claims expected +7,000 to 330,000, previous -9,000 to 323,000. Weekly continuing claims expected +9,000 to 2.960 million, previous -43,000 to 2.951 million. |
| 0830 ET | Aug import price index expected +0.5% m/m and +0.4% y/y, July +0.2% m/m and +1.0% y/y. | |
| 0830 ET | USDA weekly Export Sales. | |
| 0900 ET | New York Fed President William Dudley speaks on a panel in Paris at an event title Four years after Pittsburgh. What has OTC derivatives reform achieved so far? | |
| 1100 ET | Treasury announces amount of 10-year TIPS to be auctioned Sep 19. | |
| 1200 ET | Sep WASE crop production report. | |
| 1300 ET | Treasury auctions $13 billion 30-year T-bonds. | |
| 1400 ET | Aug monthly budget statement expected -$150.0 billion, July -$97.594 billion. | |
| GER | 0200 ET | German Aug wholesale price index, July -0.3% m/m and unch y/y. |
| EUR | 0400 ET | ECB publishes monthly report. |
| 0500 ET | Eurozone July industrial production expected -0.3% m/m and -0.2% y/y, Jun +0.7% m/m and +0.3% y/y. | |
| UK | 0500 ET | BOE Governor Mark Carney testifies to the U.S. Parliaments Treasury Committee on the BOEs Aug inflation report. |
U.S. STOCK CALENDAR09/12/2013
| Company Name | Ticker | Time | Event Description | Period | Estimate |
|---|---|---|---|---|---|
| Kroger Co/The | KR US | Bef-mkt | Q2 2014 Earnings Release | Q2 2014 | 0.595 |
| WW Grainger Inc | GWW US | 8:00 | August 2013 Sales and Revenue Call | 2013 | |
| WW Grainger Inc | GWW US | 8:00 | August 2013 Sales and Revenue Release | 2013 | |
| Aptargroup Inc | ATR US | 8:00 | Analyst Day | Y 2013 | |
| Progressive Corp/The | PGR US | 8:30 | August 2013 Sales and Revenue Release | 2013 | |
| US Bancorp/MN | USB US | 8:30 | Investor Day | Y 2013 | |
| Ecolab Inc | ECL US | 9:00 | Investor Day - Morning Session | Y 2013 | |
| Kroger Co/The | KR US | 10:00 | Q2 2014 Earnings Call | Q2 2014 | |
| Dell Inc | DELL US | 10:00 | Extraordinary Shareholders Meeting - M&A Vote | Y 2013 | |
| Mastercard Inc | MA US | 10:00 | U.S. Credit-Card Swipe Fee Settlement Hearing | ||
| Visa Inc | V US | 10:00 | U.S. Credit-Card Swipe Fee Settlement Hearing | ||
| Stratasys Ltd | SSYS US | 10:00 | Extraordinary Shareholders Meeting | Y 2013 | |
| Ulta Salon Cosmetics & Fragrance Inc | ULTA US | Aft-mkt | Q2 2014 Earnings Release | Q2 2014 | 0.666 |
| H&R Block Inc | HRB US | Annual General Meeting |
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