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OVERNIGHT MARKETS AND NEWS
March E-mini S&Ps (ESH16-0.51%) are down -0.67% and European stocks are down -1.04% as technology stocks slide, led by a 3% decline in Apple in pre-market trading, after it reported fewer-than-expected iPhones sold in Q1 and forecast a smaller-than-expected increase in Q2 revenue. The fall in China's Shanghai Composite to a 13-3/4 month low is also negative for stocks as is the -3.59% decline in crude oil prices that is undercutting energy producing stocks. The markets will be on edge ahead of the post-FOMC meeting statement later this afternoon. Asian stocks settled mixed: Japan +2.72%, Hong Kong +1.02%, China -0.52%, Taiwan +0.27%, Australia -1.20%, Singapore +0.02%, South Korea +1.66%, India +0.03%. China's Shanghai Composite fell to a 13-3/4 month low on economic concerns after China December industrial profits fell for a seventh month, although Japan's Nikkei Stock Index rallied up to a 1-week high and closed higher as carmakers rallied after the Nikkei newspaper reported that Toyota Motor may align with Suzuki Motor to better compete in emerging markets. Another positive sign for Japanese stocks was exchange data that showed short sales made up 43% of trading on the Tokyo Stock Exchange as of Tuesday's close, the highest this year. The last time short sales were this high was Sep 29, which marked the bottom of the market for several months.
The dollar index (DXY00-0.37%) is down -0.35%. EUR/USD (^EURUSD) is up +0.05%. USD/JPY (^USDJPY) is down -0.12%.
Mar T-note prices (ZNH16-0.07%) are down -2 ticks.
German Feb GfK consumer confidence was unch at 9.4, stronger than expectations of -0.1 to 9.3.
China Dec industrial profits fell -4.7% y/y, the seventh consecutive month that profits have declined.
U.S. STOCK PREVIEW
Key U.S. news today includes: (1) the outcome of the 2-day FOMC meeting that concludes today, (2) weekly MBA mortgage applications (previous +9.0% with purchase sub-index -1.6% and refi sub-index +18.7%), (3) Dec new home sales (expected +2.0% to 500,000, Nov +4.3% to 490,000), and (4) the Treasury's auction of $15 billion of 2-year floating-rate notes and $35 billion of 5-year T-notes.
There are 33 of the S&P 500 companies that report earnings today with notable reports including: Facebook (consensus $0.78), Boeing (1.37), PayPal (0.35), Discover Financial (1.30), E-Bay (0.50).
U.S. IPO's scheduled to price today: none.
Equity conferences during the remainder of this week: Cleantech Forum San Francisco on Tue-Wed, Real Estate Capital Markets 2016 Seminar on Wed.
OVERNIGHT U.S. STOCK MOVERS
Apple (AAPL +0.55%) dropped over 3% in pre-market trading after it reported shipments of 74.8 million iPhone units in Q1, short of projections of 75.5 million, and forecast Q2 revenue of $50 billion-$53 billion, below consensus of $55.5 billion.
AT&T (T +1.14%) slid nearly 2% in after-hours trading after it reported Q4 adjusted EPS of 63 cents, right on expectations, although Q4 revenue of $42.1 billion was below expectations of $42.7 billion, and new monthly subscribers rose 526,000, less than estimates of 555,000.
Stryker (SYK +1.71%) was upgraded to 'Buy' from 'Hold' at Brean Capital with a 12-month price target of $115.
Anthem (ANTM-0.66%) reported Q4 EPS of $1.14, below consensus of $1.18.
CA Technologies (CA +2.29%) climbed over 4% in after-hours trading after it reported Q3 adjusted EPS of 63 cents, higher than consensus of 58 cents.
U.S. Steel (X +12.28%) dropped over 9% in after-hours trading after it said it sees 2016 Ebitda near break-even, weaker than consensus of +$353.5 million.
Hawaiian Holdings (HA +2.31%) gained 5% in after-hours trading after it reported Q4 adjusted EPS of 85 cents, better than consensus of 84 cents, and said it sees Q1 capacity up 2.5% to 4.5%.
Ethan Allen (ETH +2.66%) climbed nearly 5% in after-hours trading after it reported Q2 adjusted EPS of 55 cents, better than consensus of 44 cents.
Capital One Financial (COF +2.93%) rose 1% in after-hours trading after it reported Q4 adjusted EPS of $1.67, higher than consensus of $1.61.
Raptor Pharmaceutical (RPTP +3.66%) surged over 15% in after-hours trading after Citigroup upgraded it to 'Buy' from 'Neutral.'
Total System Services (TSS +1.70%) slid over 4% in after-hours trading after it reported Q4 adjusted EPS continuing operations of 57 cents, below consensus of 60 cents.
Lannett (LCI +1.22%) tumbled over 10% in after-hours trading after it forecast Q2 adjusted EPS of 93 cents-95 cents, below consensus of 98 cents, and then lowered adjusted gross margins of fiscal 2016 sales to 61%-63% of net sales, below an earlier forecat of 71%-73%.
Fate Therapeutics (FATE +0.81%) soared 17% in after-hours trading after it announced FDA clearance of Investigational New Drug Application for its ProTmune for prevention of acute GvHD and CMV infection.
Mar E-mini S&Ps (ESH16-0.51%) this morning are down -12.75 points (-0.67%). Tuesday's closes: S&P 500 +1.41%, Dow Jones +1.78%, Nasdaq +0.89%. The S&P 500 index on Tuesday closed higher on strength in crude oil prices that boosted energy producing stocks and on the unexpected +1.8 point increase in U.S. Jan consumer confidence to 98.1 (stronger than expectations of unch at 96.5). Stocks were undercut by the -6.42% plunge in the Shanghai Composite to a 13-1/2 month low.
Mar 10-year T-notes (ZNH16-0.07%) this morning are down -2 ticks. Tuesday's closes: TYH6 +8.50, FVH6 +4.75. Mar T-notes on Tuesday closed higher on the -6.42% plunge in the Shanghai Composite Index to a 13-1/2 month low, which may delay a Fed rate hike, and on carryover support from a rally in German bunds to a 4-3/4 month high. T-note prices were undercut by a rally in stocks that curbed the safe-haven demand for T-notes.
The dollar index (DXY00-0.37%) this morning is down -0.347 (-0.35%). EUR/USD (^EURUSD) is up +0.0005 (+0.05%). USD/JPY (^USDJPY) is down-0.14 (-0.12%). Tuesday's closes: Dollar Index unch, EUR/USD +0.0021 (+0.19%), USD/JPY +0.12 (+0.10%). The dollar index on Tuesday closed little changed. The dollar was undercut by the rally in crude oil that boosted the Canadian dollar to a 3-week high against the dollar, and by long liquidation in the dollar ahead of the results of the Wed/Thu FOMC meeting that could result in a more dovish tone. The dollar found some support on the stronger-than-expected Jan U.S. consumer confidence report.
Mar crude oil (CLH16-2.89%) this morning is down -$1.13 a barrel (-3.59%) and Mar gasoline (RBH16-2.83%) is down -0.0388 (-3.63%). Tuesday's closes: CLH6 +0.17 (+0.56%), RBH6 -0.0090 (-0.86%). Mar crude oil and gasoline on Tuesday settled mixed. Crude oil was boosted by Iraqi Oil Minister Adel Abdul Hahdi's comment that Saudi Arabia and Russia are now more flexible about cooperating to cut crude oil output. Crude oil prices were undercut by the plunge in China's Shanghai Composite to 13-1/2 month low, a sign of economic weakness, and by expectations for Wednesday’s EIA inventory report to show U.S. crude supplies rose +4.0 million bbl.
GLOBAL EVENT CALENDAR01/27/2016
Weekly MBA mortgage applications, previous +9.0% with purchase sub-index -1.6% and refi sub-index +18.7%.
Dec new home sales expected +2.0% to 500,000, Nov +4.3% to 490,000.