BARCHART MORNING CALL 3/15

BARCHART MORNING CALL 3/15

Friday, March 15th, 2013View Older Reports

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OVERNIGHT MARKETS AND NEWS

June E-mini S&Ps (ESM13 -0.02%) are slightly lower by -0.08% on some long liquidation pressure and on today's small -0.20% sell-off in European stocks. Asian stocks today closed mixed. Japan closed sharply higher by +1.45% while Hong Kong's Hang Seng index closed down -0.38% and China's CSI 300 index closed up +0.22%. Commodity prices today are mildly higher by +0.25%. April crude oil (CLJ13 +0.54%) is up +0.31%, April gasoline (RBJ13 +0.79%) is up +0.02%, April gold (GCJ13 +0.08%) is up +0.03%, May copper (HGK13 +0.31%) is up +0.27%, and agriculture prices are trading mostly lower. The dollar index (DXY00 -0.40%) is moderately lower by -0.37% on pre-weekend long liquidation pressure. EUR/USD (^EURUSD) is up +0.44% and USD/JPY (^USDJPY) is up +0.05%. June 10-year T-notes (ZNM13 +0.02%) are unchanged.
Large U.S. banks yesterday afternoon announced their plans for investor payouts through dividend hikes and stock buybacks after the U.S. government's review was complete of their capital plans and after the results of their stress tests were announced last week.
Japan's upper house of parliament today approved Haruhiko Kuroda as Japan's next BOJ governor, who is Prime Minister Abe's dovish choice to implement a higher inflation target and an expanded asset purchase target. The lower house of Parliament confirmed Mr. Kuroda yesterday. Mr. Kuroda will begin his new position at BOJ governor next Tuesday (March 19) when the current BOJ chief Shirakawa steps down. The Diet also confirmed Mr. Kuroda's two deputies, Kikuo Iwata and Hiroshi Nakaso, who are needed to help Mr. Kuroda on his stimulus mission.
EU leaders yesterday on the first day of their 2-day summit endorsed an easing of austerity terms for France and several other countries. EU leaders are backpedaling a bit on the speed of austerity after voters have rebelled at the polls and the austerity measures have so far caused deeper recessions.
The Eurozone Feb CPI report of +0.4% m/m and +1.8% y/y was in line with market expectations. The year-on-year figure of +1.8% y/y was unchanged from January and was in line with the ECB's inflation target of slightly below 2%. The Feb core CPI report of +1.3% was also unchanged from January and was in line with market expectations.

U.S. STOCK PREVIEW

Today’s early-March U.S. consumer confidence index from the University of Michigan is expected to show a small +0.1 increase to 77.7, adding to the +3.8 point increase to 77.6 seen in February. On a year-on-year basis, the Feb CPI is expected to increase to +1.8% y/y from +1.6% in January. The Feb core CPI is expected to edge higher to +2.0% y/y from +1.9% y/y in January. Today’s Feb industrial production report is expected to show an increase of +0.3% m/m, more than recovering from the -0.1% m/m decline seen in January.
The markets today will be reacting to announcements by large U.S. banks late yesterday of their plans for dividend increases and stock buybacks after their plans were approved by the Fed. The only Russell 2000 company to release earnings today is Carnival (expected 3 cents).

June E-mini S&Ps (ESM13 -0.02%) this morning are trading slightly lower by -1.25 points (-0.08%). The S&P 500 index on Thursday posted a 5-1/3 year high and the Dow soared to a record high after weekly initial jobless claims unexpectedly declined -10,000 to 332,000, better than expectations of +10,000 to 350,000. U.S. equities also found support from a rally in European stocks after Spain had a successful bond auction, which reduced sovereign debt concerns. Closes: S&P 500 +0.56%, Dow Jones +0.58%, Nasdaq +0.31%.

OVERNIGHT U.S. STOCK MOVERS

• Hibbett Sports (HIBB +3.15%) reported Q4 EPS of 73 cents, above the consensus of 71 cents.
• Capital One (COF -0.22%) reported that its February U.S. charge-off rate fell to 4.27% from 4.36% in Feb.
• Microsoft (MSFT +0.79%) said it sold 302,000 Xbox 360 units in February, marking its 26th consecutive month as the number-one selling console in the U.S., according to data released by The NPD Group.
• The Fed accepted the capital plans for 14 banks without conditions. The banks included were: American Express Company (AXP +0.12%) ; Bank of America Corporation (BAC +0.41%) ; The Bank of New York Mellon Corporation (BK +0.42%) ; Capital One Financial Corporation (COF -0.22%) ; Citigroup (C +1.04%) ; Fifth Third Bancorp (FITB -0.12%) ; KeyCorp (KEY unch) ; Morgan Stanley (MS +0.09%) ; The PNC Financial Services Group (PNC +0.50%) ; Regions Financial Corporation (RF +0.73%) ; State Street Corporation (STT +0.23%) ; SunTrust Banks (STI -0.03%) ; U.S. Bancorp (USB -0.47%) ; and Wells Fargo & Company (WFC +0.54%) .
• Goldman Sachs (GS +1.39%) fell nearly 2% in after-hours trading after the Fed said it will require Goldman to submit a new capital plan by end of Q3 to address weaknesses in its capital planning processes.
• BB&T (BBT +0.51%) fell over 2% in after-hours trading after the Fed rejected the bank's capital plan as part of its stress testing.
• JPMorgan (JPM +1.67%) fell over 2% in after-hours trading after the Fed said it will require JPMorgan to submit a new capital plan by end of Q3 to address weaknesses in its capital planning processes.
• American Express (AXP +0.12%) said it plans to raise its quarterly dividend by 15% to 23 cents a share and to buy back $4 billion of common shares in 2013.
• SAIC (SAI -1.05%) announced it was awarded a prime contract by the United States Army Engineering and Support Center Huntsville to provide maintenance and services for Access Control Point, electronic and physical security systems, Utility Monitoring and Control Systems, and other electronic systems. The multiple-award indefinite-delivery/indefinite-quantity contract has a one-year base period of performance, four one-year options and a total contract value of $315M for all awardees, if all options are exercised.
• Krispy Kreme (KKD -0.07%) slid nearly 4% in after-hours trading after the company reported Q4 adjusted EPS of 11 cents, lower than consensus of 12 cents.
• J.B. Hunt (JBHT +0.09%) was downgraded to Market Perform from Outperform at Bernstein.
• Aeropostale (ARO +0.55%) fell over 5% in after-hours trading even after it reported Q4 adjusted EPS of 24 cents, better than consensus of 22 cents. The company said in a statement released after it reported earnings that "We anticipate a challenging first quarter as a result of expected margin pressures from holiday carryover inventory, and the impact of a weak macroeconomic environment."

MARKET COMMENTS

June 10-year T-notes (ZNM13 +0.02%) this morning are trading unchanged. June 10-year T-note prices on Thursday closed little changed. T-note prices traded lower most of the day after an unexpected fall in weekly U.S. jobless claims (-10,000 to 332,000) propelled the Dow to a record high and reduced the safe-haven demand for Treasuries. However, T-notes recovered early losses on dealer covering of short-hedges after the completion of the Treasury's $13 billion T-bond auction. Closes: TYM3 +0.5, FVM3 unch.
The dollar index (DXY00 -0.40%) this morning is down -0.31 (-0.37%) on some pre-weekend long liquidation pressure. EUR/USD
(^EURUSD) is up +0.0057 (+0.44%) after a positive week that saw successful Irish and Spanish bond auctions and easier austerity terms out of the EU Summit. USD/JPY (^USDJPY) is up +0.05 (+0.05%). The dollar index on Thursday rallied up to a fresh 7-1/4 month high, but fell back and closed lower after a rally in equities reduced the safe haven demand for the dollar. EUR/USD recovered from a 3-month low after Spain had a successful bond auction, while USD/JPY moved up to near a 3-1/2 year high as the yen weakened when Japan's lower house of parliament endorsed Haruhiko Kuroda, an advocate of increased stimulus, as the next BOJ governor. Closes: Dollar index -0.283 (-0.34%), EUR/USD +0.00438 (+0.34%), USD/JPY -0.005 (-0.001%).
April WTI crude oil (CLJ13 +0.54%) this morning is up +0.29 (+0.31%) while April gasoline (RBJ13 +0.79%) is up +0.0006 (+0.02%). Crude oil and gasoline prices on Thursday settled mixed. Crude oil gained as an unexpected fall in weekly U.S jobless claims and stock market strength bolstered the outlook for the economy and crude demand. Gasoline fell on speculation near-record crack spreads will prompt refiners to increase gasoline production. Closes: CLJ3 +0.51 (+0.55%), RBJ3 -0.0010 (-0.03%).

GLOBAL EVENT CALENDAR03/15/2013

US	0830 ET	March Empire manufacturing index expected -2.0 at 8.0, Feb +17.82 to 10.04.
	0830 ET	Feb CPI expected +0.5% m/m and +1.8% y/y, Jan unch m/m and +1.6% y/y. Feb core CPI expected +0.2% m/m and +2.0% y/y, Jan +0.3% m/m and +1.9% y/y.
	0915 ET	Feb industrial production expected +0.3% m/m, Jan -0.1% m/m. Feb manufacturing production expected +0.2% m/m, Jan -0.4% m/m. Feb capacity utilization expected +0.2 to 79.3%, Jan 79.1%.
	0930 ET	Dallas Fed President Richard Fisher speaks at 2013 Conservative Political Action Conference on risks of U.S. banks considered “too big to fail.”
	0955 ET	Early-March U.S. consumer confidence (University of Michigan) expected +0.1 to 77.7, Feb +3.8 to 77.6.
EUR	n/a	EU 2-day summit in Brussels concludes.
	0600 ET	Eurozone Feb CPI expected +0.4% m/m and +1.8% y/y, Jan -1.0% m/m. Feb core CPI expected +1.3% y/y, Jan +1.3% y/y.
	0600 ET	Eurozone Q4 labor costs, Q3+2.0%y/y.

U.S. STOCK CALENDAR03/15/2013

Company Name	Symbol	Time	Event Description	Period	EPS Est (US$)
Carnival Corp	CCL	Bef-mkt	Q1 2013 Earnings Release	Q1 2013	0.032
Carnival Corp	CCL	10:00	Q1 2013 Earnings Call	Q1 2013
Ford Motor Co	F	10:30	Ford University Call
Multiple Companies	OGE	11:30	Business Update Call
Multiple Companies	OGE	11:30	Business Update Call
Whole Foods Market Inc	WFM	12:00	Annual General Meeting	Y 2013
JPMorgan Chase & Co	JPM		Former CIO Ina Drew Testifies to U.S. Senate Panel
Time Warner Inc	TWX		Box Office Release of Movie Burt Wonderstone""
Owens Corning	OC		Roadshow Day 2	Y 2013