Friday, October 25th, 2013View Older Reports
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OVERNIGHT MARKETS AND NEWS
December E-mini S&Ps (ESZ13 +0.03%) this morning are trading slightly lower by -0.10% while the Euro Stoxx 50 index is down -0.23%. Asian stocks today closed lower nearly across the board: Japan -2.75%, Hong Kong -0.60%, China CSI 300 -1.33%, Taiwan -0.80%, Australia +0.25%, Singapore -0.39%, South Korea -0.69%, India -0.20%, Turkey +0.13%. Bearish factors include (1) continued concern about the recent surge in China's 1-month interbank rate on the central bank's refusal to inject liquidity through money market operations, and (2) disappointing sales news today from companies such as Renault and Canon.Commodity prices are mixed. Dec crude oil (CLZ13 +0.24%) is up +0.37 (+0.38%), but Dec gasoline (RBZ13 -0.68%) is down -0.12 (-0.11%). Dec gold (GCZ13 -0.88%) is down -8.8 (-0.65). Agricultural prices are mixed. The dollar index (DXY00 +0.06%) is slightly higher by +0.03 (+0.04%). EUR/USD (^EURUSD) is down -0.0003 (-0.02%) and USD/JPY (^USDJPY) is down -0.05 (-0.05%). December T-note prices (ZNZ13 +0.05%) are up 2.5 ticks.
The New Zealand dollar fell by -0.4% today against the Australian dollar after the country's central bank chief expressed concern that a stronger currency may hurt trade, which suggested that the bank will not raise interest rates.
Germany's Oct IFO business climate index rose by +0.3 points to 108.0 from 107.7 in Sep, which was stronger than market expectations for a -0.3 point drop to 107.4. However, the Oct IFO expectations index fell by -0.6 points to 103.6 from 104.2, which was weaker than market expectations for a +0.3 point increase to 104.5.
The Eurozone Sep M3 money supply report of +2.1% y/y was down from +2.3% y/y in Aug and was weaker than market expectations of +2.4% y/y. The report indicated weaker money demand in Sep.
The UK Q3 GDP report of +0.8% q/q and +1.5% y/y was up from Q2's +0.7% q/q and +1.3% and was in line with market expectations. UK GDP showed the fastest growth in more than 3 years, which was a boost for the overall global economic outlook.
Japan's Sep national CPI rose +1.1% from +0.9% in Aug and was stronger than market expectations of +0.9%. The report provided some hope that Japan is winning its long battle against deflation. However, Japan's Sep CPI excluding food and energy was unchanged y/y, up from -0.1% in Aug.
U.S. STOCK PREVIEW
Today’s final-Oct U.S. consumer confidence index from the University of Michigan is expected to show a -0.2 point decline to 75.0 from the early-October level of 75.2. Today’s Sep durable goods orders report is expected to show some strength at +2.3% and +0.5% ex-transportation. There are 16 of the S&P 500 companies that report earnings today with notable reports including Procter & Gamble, AbbVie, Moody's Eaton, Rockwell Collins, and UPS. There are no equity conferences scheduled for today.Dec E-mini S&Ps (ESZ13 +0.03%) this morning are trading slightly lower by -1.75 points (-0.10%) due to lower overseas stocks with Europe down -0.23% and Asian stocks closing mostly lower. The S&P 500 index on Thursday closed higher. Supportive factors included (1) strength in Chinese manufacturing activity after the China Oct HSBC/Markit flash manufacturing PMI rose +0.7 to 50.9, a faster pace of expansion than expectations of +0.2 to 50.4, and (2) healthy Q3 earnings results thus far with 76% of the 212 reporting companies in the S&P 500 beating earnings estimates. Stocks shrugged off the weekly initial jobless claims that fell -12,000 to 350,000, less than expectations of -18,000 to 340,000. Closes: S&P 500 +0.33%, Dow Jones +0.62%, Nasdaq 100 +0.49%.
OVERNIGHT U.S. STOCK MOVERS
Earnings reports that have been released this morning have been mixed. Companies that beat earnings include Weyerhaeuser (WY -0.53%) (0.35 vs 0.21), Simon Property Group (SPG +1.07%) (2.21 vs 2.16), Newell Rubbermaid (NWL -0.48%) (0.52 vs 0.49), Aon (AON -0.36%) (1.13 vs 1.04), Sherwin Williams (SHW +1.32%) (2.68 vs 2.64), Moody's (MCO +1.74%) (0.83 vs 0.81), National Oilwell Varco (NOV +0.41%) (1.34 vs 1.32), Ventas (VTR +0.03%) (1.04 vs 1.02).Companies that underperformed earnings include DTE Energy (DTE -0.97%) (1.11 vs 1.22), ({=Eaton ETN=}) (1.12 vs 1.124), Procter & Gamble (PG -0.37%) (1.05 vs 1.053), ({=Legg Mason LM=}) (0.54 vs 0.62), and Rockwell Collins (COL +0.29%) (1.28 vs 1.31).
USP (UPS +0.57%) this morning reported Q adjusted EPS of $1.16, which was slightly better than the consensus of $1.15. However, Q3 revenue of $13. 52 billion was slightly below the consensus of $13.60 billion. The company reiterated its full-year guidance of $4.65-4.85, which would be up 3-7% y/y.
Barrons, in its Weekday Trader column, said that Citigroup (C -0.08%) trades at a discount to other financial stocks and if it would trade in line with its peers, then the stock could rise 32%.
Eastman Chemical (EMN -0.51%) reported Q3 EPS ex-items of $1.68, better than consensus of $1.64, but then lowered guidance on fiscal 2013 EPS view to $6.30-$6.40 from $6.40-$6.50, weaker than consensus of $6.48.
Manitowoc (MTW +1.08%) reported Q3 EPS of 39 cents, higher than consensus of 32 cents.
Western Digital (WDC +0.61%) reported Q1 EPS of $2.12, stronger than consensus of $2.05.
NCR Corp. (NCR +0.60%) reported Q3 EPS of 76 cents, better than consensus of 68 cents.
Chubb (CB -0.27%) reported Q3 EPS of $2.06, stronger than consensus of $1.88, and then raised guidance on fiscal 2013 EPS view to $7.90-$8.00 from $7.30-$7.50, well ahead of consensus of $7.65.
Wynn Resorts (WYNN +3.84%) reported Q3 EPS of $1.84, much better than consensus of $1.65.
Principal Financial Group (PFG +1.10%) reported Q3 operating EPS of 90 cents, better than consensus of 87 cents.
Microsoft (MSFT -0.12%) jumped 6% in after-hours trading after it reported Q1 EPS of 62 cents, well ahead of consensus of 54 cents.
MARKET COMMENTS
Dec 10-year T-notes (ZNZ13 +0.05%) this morning are up 2.5 ticks on lower global stocks today. Dec 10-year T-note prices on Thursday closed lower on reduced safe-haven demand as stocks rallied on stronger-than-expected Chinese manufacturing activity. Losses in T-notes were muted on expectations the Fed will not taper QE3 after U.S. weekly jobless claims fell less than expected. Closes: TYZ3 -8, FVZ3 -4.The dollar index (DXY00 +0.06%) this morning is trading slightly higher by +0.03 points (+0.04%). EUR/USD (^EURUSD) is down -0.0003 (-0.02%) while USD/JPY (^USDJPY) is down -0.05 (-0.05%). The dollar index on Thursday slid to a new 8-3/4 month low on speculation that the smaller-than-expected increase in weekly U.S. unemployment claims will prompt the Fed to maintain QE3. EUR/USD surged to a 23-month high after the German Oct PMI manufacturing index rose +0.4 to 51.5, better than expectations of +0.3 to 51.4. Closes: Dollar index -0.079 (-0.10%), EUR/USD +0.0025 (+0.18%), USD/JPY -0.094 (-0.10%).
Dec WTI crude oil (CLZ13 +0.24%) this morning is up +0.37 (+0.38%) while Dec gasoline (RBZ13 -0.68%) is down -0.12 (-0.11%). Dec crude oil and gasoline prices on Thursday posted 3-3/4 month lows but recovered and closed higher. Dec crude rebounded as equities rallied and after the dollar index fell to an 8-3/4 month low. Dec gasoline closed higher on concern over tighter supplies in the Midwest after a fire forced a closure of Citgo Petroleum’s 170,500 barrel-a-day refinery in Lemont, IL. Closes: CLZ3 +0.25 (+0.26%), RBZ3 +0.0293 (+1.15%).
GLOBAL EVENT CALENDAR10/25/2013
| US | 0830 ET | Sep durable goods orders expected +2.2% and +0.5% ex transportation, Aug +0.1% and -0.1% ex transportation. Sep capital goods orders non-defense ex-aircraft expected +0.7% m/m, Aug +1.5%. |
| 0955 ET | Final-Oct University of Michigan U.S. consumer confidence expected -0.2 to 75.0, early-Oct -2.3 to 75.2. | |
| 1000 ET | Aug wholesale inventories expected +0.3% m/m, July +0.1%. Aug wholesale sales expected +0.3% m/m, July +0.1% m/m. | |
| GER | 0400 ET | German Oct IFO business climate expected +0.3 to 108.0, Sep 107.7. Oct IFO current assessment expected unch at 111.4, Sep 111.4. Oct IFO expectations expected +0.3 to 104.5, Sep 104.2. |
| EUR | 0400 ET | Eurozone Sep M3 money supply expected +2.4% y/y and +2.3% 3-mo avg, Aug +2.3% y/y and +2.3% 3-mo avg. |
| UK | 0430 ET | UK Q3 GDP expected +0.8% q/q and +1.5% y/y, Q2 +0.7% q/q and +1.3% y/y. |
| 0430 ET | UK Aug index of services expected +0.4% m/m and +0.5% 3-mo/3-mo, July +0.2% m/m and +0.5% 3-mo/3-mo. |
U.S. STOCK CALENDAR10/25/2013
| Company Name | Ticker | Time | Event Description | Period | Estimate |
|---|---|---|---|---|---|
| Newell Rubbermaid Inc | NWL US | Bef-mkt | Q3 2013 Earnings Release | Q3 2013 | 0.491 |
| Aon PLC | AON US | Bef-mkt | Q3 2013 Earnings Release | Q3 2013 | 1.026 |
| Procter & Gamble Co/The | PG US | Bef-mkt | Q1 2014 Earnings Release | Q1 2014 | 1.053 |
| AbbVie Inc | ABBV US | Bef-mkt | Q3 2013 Earnings Release | Q3 2013 | 0.776 |
| Sherwin-Williams Co/The | SHW US | Bef-mkt | Q3 2013 Earnings Release | Q3 2013 | 2.637 |
| DTE Energy Co | DTE US | Bef-mkt | Q3 2013 Earnings Release | Q3 2013 | 1.216 |
| Moody's Corp | MCO US | Bef-mkt | Q3 2013 Earnings Release | Q3 2013 | 0.813 |
| Eaton Corp PLC | ETN US | Bef-mkt | Q3 2013 Earnings Release | Q3 2013 | |
| Ventas Inc | VTR US | Bef-mkt | Q3 2013 Earnings Release | Q3 2013 | 1.019 |
| Weyerhaeuser Co | WY US | Bef-mkt | Q3 2013 Earnings Release | Q3 2013 | 0.212 |
| National Oilwell Varco Inc | NOV US | Bef-mkt | Q3 2013 Earnings Release | Q3 2013 | 1.315 |
| Legg Mason Inc | LM US | 7:00 | Q2 2014 Earnings Release | Q2 2014 | 0.615 |
| Rockwell Collins Inc | COL US | 7:30 | Q4 2013 Earnings Release | Q4 2013 | 1.313 |
| United Parcel Service Inc | UPS US | 7:45 | Q3 2013 Earnings Release | Q3 2013 | 1.151 |
| Legg Mason Inc | LM US | 8:00 | Q2 2014 Earnings Call | Q2 2014 | |
| Eastman Chemical Co | EMN US | 8:00 | Q3 2013 Earnings Call | Q3 2013 | |
| Aon PLC | AON US | 8:30 | Q3 2013 Earnings Call | Q3 2013 | |
| Avery Dennison Corp | AVY US | 8:30 | Q3 2013 Earnings Release | Q3 2013 | 0.638 |
| Procter & Gamble Co/The | PG US | 8:30 | Q1 2014 Earnings Call | Q1 2014 | |
| Express Scripts Holding Co | ESRX US | 8:30 | Q3 2013 Earnings Call | Q3 2013 | |
| United Parcel Service Inc | UPS US | 8:30 | Q3 2013 Earnings Call | Q3 2013 | |
| Gilead Sciences Inc | GILD US | FDA Adcomm, sofosbuvir, Hepatitis C | |||
| Twenty-First Century Fox Inc | FOXA US | U.S. Box Office Release of Movie The Counselor"" | |||
| Harris Corp | HRS US | Annual General Meeting | |||
| Simon Property Group Inc | SPG US | Q3 2013 Earnings Release | Q3 2013 | 2.162 |
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