BARCHART MORNING CALL 12/13

BARCHART MORNING CALL

Friday, December 13th, 2013View Older Reports

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OVERNIGHT MARKETS AND NEWS

March E-mini S&Ps (ESH14 +0.40%) this morning are up +0.42% and European stocks are up +0.33% after the U.S. House of Representatives late yesterday passed the first bipartisan budget in four years. Asian stocks closed mixed: Japan +0.40%, Hong Kong +0.12%, China -0.14%, Taiwan +0.19%, Australia +0.71%, Singapore +0.23% South Korea -0.39%, India -1.00%. Japanese exporters rallied and led the Nikkei Stock Index higher after the yen fell to a 5-year low against the dollar, which boosts the prospects for exporter profits. Commodity prices are mixed. Jan crude oil (CLF14 -0.54%) is down -0.41%. Jan gasoline (RBF14 +0.17%) is up +0.26%. Feb gold (GCG14 +0.38%) is up +0.28%. March copper (HGH14 +0.05%) is up +0.17%. Agricultural and livestock prices are mostly lower. The dollar index (DXY00 +0.18%) is up +0.16%. EUR/USD (^EURUSD) is down -0.20%. USD/JPY (^USDJPY) is up +0.22% at a 5-year high as the yen weakened on expectations the Fed will taper QE3 while the BOJ will expand its asset-purchase program to boost the economy and raise the inflation rate. March T-note prices (ZNH14 -0.05%) are down -2 ticks.
The Japanese yen tumbled to a 5-year low against the U.S. dollar after BOJ Governor Kuroda said in a FT interview that "we intend to achieve the 2% inflation target and maintain that in a stable manner," and if our models are mistaken or economic shock occurs, we can "adjust if necessary." This suggests the BOJ will maintain and possibly expand its ultra-easy monetary policy in order to achieve its policy goals.
The U.S. House of Representatives late yesterday passed a budget that limits automatic cuts to federal spending and avoids another government shutdown next month. The Senate still needs to approve the legislation before President Obama signs it into law.
Eurozone Q3 employment was unch q/q, the tenth consecutive quarter of no employment increase. On a year-over-year bases Q3 employment fell -0.8% y/y,
The German Nov wholesale price index fell -0.2% m/m, for the eighth month out of nine that wholesale prices have fallen. On an annual basis, wholesale prices fell -2.2% y/y.
UK Oct construction output rose +2.2% m/m and +5.3% y/y, stronger than expectations of +1.6% m/m and +1.3% y/y.
Japan Oct industrial production was revised up to +1.0% m/m and +5.4% y/y from the originally reported +0.5% m/m and +4.7% y/y.
The India Nov CPI climbed +11.24% y/y, higher than expectations of +10.00% y/y and the fastest pace of increase in 22-months. This may prompt the RBI to raise interest rates at its policy meeting next week.

U.S. STOCK PREVIEW

Today’s Nov PPI report is expected to strengthen to +0.8% y/y from +0.3% in October. Meanwhile, the Nov core PPI is expected to be unchanged from October at +1.4% y/y. There are no major earnings reports today. There are no equity conferences today.

OVERNIGHT U.S. STOCK MOVERS

Amazon.com (AMZN -0.25%) was upgraded to 'Strong Buy' from 'Buy' at ISI Group.
British Petroleum (BP -1.13%) was downgraded to 'Neutral' from 'Buy' at UBS.
Advance Auto Parts (AAP +0.82%) was upgraded to 'Top Pick' from 'Outperform' at RBC Capital.
Anadarko (APC +0.10%) was downgraded to 'Underweight' from 'Neutral' at JPMorgan.
FedEx (FDX -0.12%) was upgraded to 'Strong Buy' from 'Outperform' at Raymond James.
Boeing (BA +0.30%) was awarded a $872.77 million government contract for system upgrades for F/A-18 A/B, C/D, E/F and EA-18G aircraft for the U.S. Navy and the governments of Australia, Finland, Switzerland, Kuwait, Malaysia, and Canada.
Billionare investor Carl Icahn reported a 12.51% stake in Hologic (HOLX -0.55%) .
Restoration Hardware (RH -1.17%) raised guidance on fiscal year 2014 EPS view $1.71-$1.74 from $1.65 to $1.70, stroger than consensus of $1.71.
According to data from ComScore, Google Sites (GOOG -0.68%) led the U.S. explicit internet core search market in November with 66.7% market share, followed by Microsoft Sites (MSFT -1.04%) with 18.1% and Yahoo Sites (YHOO +0.51%) with 11.2%.
Quiksilver (ZQK +2.66%) reported a Q4 EPS loss ex-items of -4 cents, weaker than consensus of a 4 cents gain.
SAIC (SAIC -2.44%) reported Q3 EPS of 44 cents, weaker than consensus of 50 cents, and then lowered guidance on fiscal 2014 EPS to $2.13-$2.33, well below consensus of $2.47..
Adobe (ADBE -1.19%) climbed over 6% in pre-market tradng after it reported Q4 adjusted EPS of 32 cents, right on consensus, although it said it signed up 402,000 customers in Q4 to its Creative Cloud online software, higher than analysts' estimates of 350,000 new customers.

MARKET COMMENTS

Mar E-mini S&Ps (ESH14 +0.40%) this morning are up +7.50 points (+0.42%). The S&P 500 index on Thursday dropped to a 1-month low and closed lower after Nov retail sales rose +0.7% and +0.4% ex-autos, which boosted speculation the Fed may taper QE3 as soon as next week. U.S. weekly initial unemployment claims jumped +68,000 to a 2-month high of 368,000 on what appeared to be mostly seasonal volatility. Closes: S&P 500 -0.38%, Dow Jones -0.66%, Nasdaq 100 -0.25%.
Mar 10-year T-notes (ZNH14 -0.05%) this morning are down -2 ticks. Mar T-notes on Thursday closed lower after the stronger-than-expected U.S. Nov retail sales added to speculation that the Fed will soon curb its bond purchases. Declines were limited after weekly jobless claims rose a more-than-expected +68,000 to a 2-month high. Closes: TYH4 -8.50, FVH4 -7.00.
The dollar index (DXY00 +0.18%) this morning is up +0.128 (+0.16%). EUR/USD (^EURUSD) is down -0.0028 (-0.20%) and USD/JPY (^USDJPY) is up +0.23 (+0.22%) at a 5-year high. The dollar index on Thursday closed higher after the larger-than-expected increase in U.S. Nov retail sales boosted speculation the Fed may start to taper QE3 as soon as next week’s FOMC meeting. EUR/USD retreated after Eurozone Oct industrial production unexpectedly fell -1.1% m/m, much weaker than expectations of +0.3% m/m and the biggest monthly decline in 13 months. Closes: Dollar index +0.312 (+0.39%), EUR/USD -0.00325 (-0.24%), USD/JPY +0.945 (+0.92%).
Jan WTI crude oil (CLF14 -0.54%)this morning is down -40 cents (-0.41%) and Jan gasoline (RBF14 +0.17%) is up +0.0068 (+0.26%). Jan crude oil and gasoline prices on Thursday closed mixed. Crude prices closed higher as stronger-than-expected U.S. Nov retail sales bolstered the outlook for the economy and energy demand, while gasoline prices fell on concern about higher supplies with U.S. refiners operating at a 5-month high of 92.6% of capacity. Closes: CLF4 +0.06 (+0.06%), RBF4 -0.0263 (-0.99%).

GLOBAL EVENT CALENDAR12/13/2013

US	0830 ET	Nov PPI expected unch m/m and +0.8% y/y, Oct -0.2% m/m and +0.3% y/y. Nov PPI ex food & energy expected +0.1% m/m and +1.4% y/y, Oct +0.2% m/m and +1.4% y/y.
	n/a	U.S. Congress deadline for budget proposal.
GER	0200 ET	German Nov wholesale price index, Oct -1.0% m/m and -2.7% y/y.
UK	0430 ET	UK Oct construction output expected +1.6% m/m and +1.3% y/y, Sep -0.9% m/m and +5.8% y/y.

U.S. STOCK CALENDAR12/13/2013

Company Name	Ticker	Time	Event Description	Period	Estimate
Scotts Miracle-Gro Co/The	SMG US	9:30	Analyst & Investor Day	Y 2013
Landstar System Inc	LSTR US	14:00	Q4 2013 Guidance Call - Mid Quarter	Q4 2013
Johnson & Johnson	JNJ US		PDUFA, Complera, switch indication in HIV
Gilead Sciences Inc	GILD US		PDUFA, Complera, switch indication in HIV
Lions Gate Entertainment Corp	LGF US		U.S. Box Office Release of Movie Tyler Perry's A Madea Christmas""