Tuesday, January 14th, 2014View Older Reports
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OVERNIGHT MARKETS AND NEWS
March E-mini S&Ps (ESH14 +0.21%) this morning are up +0.15% and European stocks are down -0.46% as they play catch-up with yesterday's late-afternoon slide in U.S. stocks. Asian stocks closed mostly lower: Japan -3.08%, Hong Kong -0.43%, China +0.87%, Taiwan -0.21%, Australia -1.51%, Singapore -0.37%, South Korea -0.04%, India -0.48%. Japan's Nikkei Stock Index plunged over -3% to a 3-week low after Japan's Nov current-account deficit widened to a record. Commodity prices are mixed. Feb crude oil (CLG14 +0.25%) is up +0.22%. Feb gasoline (RBG14 -0.18%) is down -0.01%. Feb gold (GCG14 -0.28%) is down -0.27%. March copper (HGH14 -0.03%) is down -0.21%. Agriculture and livestock prices are mixed. The dollar index (DXY00 +0.09%) is up +0.06%. EUR/USD (^EURUSD) is up +0.07% at a 1-1/2 week high on stronger-than-expected Eurozone Nov industrial production along with upbeat comments from ECB Governing Council member Nowotny. USD/JPY (^USDJPY) is up +0.54%. March T-note prices (ZNH14 -0.18%) are down -6 ticks.Eurozone Nov industrial production rose +1.8% m/m, stronger than expectations of +1.4% m/m and the most in 3-1/2 years. On a year-over-year basis, Nov industrial production climbed +3.0% y/y, better than expectations of +1.8% y/y and the most in 2-1/4 years.
ECB Governing Council member Nowotny said "there is potential on the upside" for this year's GDP in the Eurozone, and that economic growth may exceed expectations as "the view for Europe as a whole is now much better than a year ago."
UK Dec CPI rose +0.4% m/m and +2.0% y/y, less than expectations of +0.5% m/m and +2.1% y/y with the +2.0% y/y increase the slowest annual pace of inflation in 4-years. The Dec core CPI rose +1.7% y/y, weaker than expectations of +1.8% y/y and matched October's increase as the slowest pace in 4-1/2 years.
The German Dec wholesale price index rose +0.4% m/m and fell -1.8% y/y.
The Japan Nov current account balance widened to a -592.8 billion yen deficit, a bigger deficit than expectations of -368.9 billion yen and the most since data began in 1985.
Japan Dec eco watchers survey of current conditions rose +2.2 to 55.7, more than expectations of +0.5 to 54.0 and the highest in 7-months. The Dec eco watchers survey outlook fell -0.1 to 54.7.
Japan Dec bankruptcies fell -15.73% y/y, the biggest decline in 10-months and the fourteenth consecutive monthly drop.
U.S. STOCK PREVIEW
Today’s Dec retail sales report is expected to show a small increase of +0.1%, falling back after the strong increase of +0.7% seen in November. Excluding the weak level of Dec auto sales, Dec retail sales are expected to show a more respectable increase of +0.4%. Today’s Dec import price index is expected to strengthen a bit to -0.6% y/y from -1.5% y/y in November. Today’s Nov business inventories report is expected to show an increase of +0.3%, adding to the +0.7% increase seen in October. There are three of the S&P 500 companies that report earnings today: JPMorgan (consensus $1.37), Wells Fargo (0.98), Linear Technology Corp (0.49).Equity Conferences this week include: FMI Midwinter Executive Conference on Mon-Tue, North American (Detroit) International Auto Show-NAIAS 2014 on Mon-Tue, ICR Exchange Conference on Mon-Tue, Biotech Showcase Investor Conference on Mon-Wed, J.P. Morgan Healthcare Conference on Mon-Thu, BMO Unconventional Resource Conference on Tue, Deutsche Bank Global Auto Industry Conference on Tue-Wed.
OVERNIGHT U.S. STOCK MOVERS
JPMorgan Chase (JPM -1.35%) reported Q4 EPS of $1.40, better than consensus of $1.37.Stanley Black & Decker (SWK -1.56%) was upgraded to 'Buy' from 'Hold' at KeyBanc.
Nokia (NOK -2.44%) was downgraded to 'Underperform' from 'Market Perform' at Raymond James.
Family Dollar (FDO -3.68%) was downgraded to 'Underweight' from 'Equal Weight' at Barclays.
Jabil Circuit (JBL -2.53%) was upgraded to 'Conviction Buy' from 'Neutral' at Goldman.
Qualcomm (QCOM -0.88%) was downgraded to 'Market Perform' from 'Outperform' at Raymond James.
Intel (INTC -0.12%) was upgraded to 'Overweight' from 'Neutral' at JPMorgan with a $29 price target.
Danaher (DHR -1.97%) was upgraded to 'Buy' from 'Neutral' at BofA/Merrill.
General Mills (GIS -0.97%) was downgraded to 'Underweight' from 'Equal Weight' at Morgan Stanley.
WellPoint (WLP -1.25%) raised guidance on fiscal 2013 adjusted EPS to $8.52 from 'at least' $8.40, above consensus of $8.51.
Standard & Poor's Ratings Services placed its ratings on Sears Holdings (SHLD -3.41%) on CreditWatch with negative implications following Sears' earnings guidance update that results for Q4 ending Feb. 1 will be much weaker than expectations.
Yum! Brands (YUM -2.15%) gained 1% in after-hours trading after it reported that December same-store sales increased an estimated 2% for its China Division, but then reversed and fell over 1% after it reported its Q4 same-store sales declined an estimated 4% for the China Division.
Google (GOOG -0.64%) climbed 1.3% in pre-market trading after announced that it has entered into an agreement to buy Nest Labs for $3.2 billion in cash.
Bloomberg reported that Charter (CHTR -1.61%) offered to buy Time Warner Cable (TWC -0.72%) for about $132.50 a share, but then the Time Warner Cable board rejected the Charter offer, calling it 'grossly inadequate.'
MARKET COMMENTS
Mar E-mini S&Ps (ESH14 +0.21%) this morning are up +2.75 points (+0.15%). The S&P 500 on Monday fell sharply on long liquidation pressures sparked by valuation concerns with S&P 500’s P/E ratio near a 4-year high. Another negative for stocks was the upbeat comment from Atlanta Fed President Lockhart, who said he sees “growing confidence” in the 2014 outlook as the “weight of uncertainty” on the economy has diminished, which signals the Fed may continue to taper QE3. Closes: S&P 500 -1.26%, Dow Jones -1.08%, Nasdaq 100 -1.47%.Mar 10-year T-notes (ZNH14 -0.18%) this morning are down -6 ticks. Mar 10-year T-note futures prices on Monday climbed to a 3-week high and settled higher on speculation that Friday’s smaller-than-expected increase in Dec payroll along could prompt the Fed to delay further QE3 tapering. Closes: TYH4 +9.0, FVH4 +5.00.
The dollar index (DXY00 +0.09%) this morning is up +0.051 (+0.06%). EUR/USD (^EURUSD) is up +0.0009 (+0.07%) at a 1-1/2 week high. USD/JPY (^USDJPY) is up +0.56 (+0.54%). The dollar index on Monday posted a 1-week low and closed lower. The dollar was undercut due to negative carry-over from Friday’s weaker-than-expected Dec non-farm payroll report, along with expectations that Tuesday’s U.S Dec retail sales report will show slower sales, which could produce a slower QE3 tapering. Closes: Dollar index -0.145 (-0.18%), EUR/USD +0.0002 (+0.01%), USD/JPY -1.139 (-1.09%).
Feb WTI crude oil (CLG14 +0.25%) this morning is up +20 cents (+0.22%) and Feb gasoline (RBG14 -0.18%) is down -0.0002 (-0.01%). Feb crude oil prices and Feb gasoline prices on Monday closed lower after Iran agreed to curtail its nuclear program and allow international nuclear inspectors in its country starting Jan 20. This may lead to a longer-term deal between Iran and the international community that eventually ends economic sanctions against Iran and puts crude oil from Iran, OPEC’s fifth biggest oil producer, back on the global market. Closes: CLG4 -0.92 (-0.99%), RBG4 -0.0350 (-1.31%).
GLOBAL EVENT CALENDAR01/14/2014
| US | 0830 ET | Dec retail sales expected +0.1% and +0.4% ex-autos, Nov +0.7% and +0.4% ex-autos. |
| 0830 ET | Dec import price index expected +0.4% m/m and -0.6% y/y, Nov -0.6% m/m and -1.5% y/y. | |
| 1000 ET | Nov business inventories expected +0.3%, Oct +0.7%. | |
| 1245 ET | Philadelphia Fed President Charles Plosser speaks on the economic outlook to the Union League of Philadelphia. | |
| 1320 ET | Dallas Fed President Richard Fisher speaks on the U.S. and regional economic outlook to the National Association of Corporate Directors. | |
| JPN | 0000 ET | Japan Dec eco watchers survey current expected +0.5 to 54.0, Nov 53.5. Dec eco watchers survey outlook, Nov 54.8. |
| GER | 0200 ET | German Dec wholesale price index, Nov -0.2% m/m and -2/2% y/y. |
| UK | 0430 ET | UK Dec PPI input prices expected -0.2% m/m and -1.5% y/y, Nov -0.7% m/m and -1.0% y/y. |
| 0430 ET | UK Dec PPI output prices expected unch m/m and +1.0% y/y, Nov -0.2% m/m and +0.8% y/y. Dec PPI output core expected unch m/m and +0.9% y/y, Nov -0.1% m/m and +0.7% y/y. | |
| 0430 ET | UK Dec CPI expected +0.5% m/m and +2.1% y/y, Nov +0.1% m/m and +2.1% y/y. Dec CPI core expected +1.8% y/y, Nov +1.8% y/y. | |
| 0430 ET | UK Dec RPI expected +0.5% m/m and +2.7% y/y, Nov +0.1% m/m and +2.6% y/y. Dec RPI ex mortgage interest payments expected +2.8% y/y, Nov +2.7% y/y. | |
| EUR | 0310 ET | ECB Governing Council member Ewald Nowotny delivers keynote speech at a Euromoney conference n Vienna. |
| 0500 ET | Eurozone Nov industrial production expected +1.4% m/m and +1.8% y/y, Oct -1.1% m/m and +0.2% y/y. |
U.S. STOCK CALENDAR01/14/2014
| Company Name | Ticker | Time | Event Description | Period | Estimate |
|---|---|---|---|---|---|
| JPMorgan Chase & Co | JPM US | 7:00 | Q4 2013 Earnings Release | Q4 2013 | 1.368 |
| Wells Fargo & Co | WFC US | 8:00 | Q4 2013 Earnings Release | Q4 2013 | 0.983 |
| JPMorgan Chase & Co | JPM US | 8:30 | Q4 2013 Earnings Call | Q4 2013 | |
| Linear Technology Corp | LLTC US | Aft-mkt | Q2 2014 Earnings Release | Q2 2014 | 0.487 |
| Beam Inc | BEAM US | Suntory Holdings Acquires Beam | |||
| GameStop Corp | GME US | December 2013 Sales and Revenue Release | 2013 |
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