Wednesday, April 30th, 2014View Older Reports
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OVERNIGHT MARKETS AND NEWS
June E-mini S&Ps (ESM14 -0.08%) this morning are down -0.11% as weaker-than-expected earnings results from EBAY and Twitter drag U.S. stocks lower, and European stocks are down -0.38%, led by a slide in bank stocks with BNP Paribas SA down over 3% after France's largest bank said it may need to pay much more than the $1.1 billion it set aside for alleged U.S. sanctions breaches. Russia's Micex Stock Index fell and the ruble weakened after the IMF cut its Russian 2014 GDP estimate to +0.2% from an earlier forecast of +1.3%, citing the risk of escalating sanctions. Asian stocks closed mixed: Japan +0.11%, Hong Kong -1.42%, China +0.01%, Taiwan -0.81%, Australia +0.05%, Singapore +0.83%, South Korea -0.18%, India -0.22%. The BOJ refrained from additional stimulus measures following its 2-day meeting today with BOJ Governor Kuroda saying the Japanese economy is weathering the sales-tax increase and he predicts inflation will reach the BOJ's goal next year. Commodity prices are mostly lower. Jun crude oil (CLM14 -1.14%) is down -0.84% at a 3-week low on expectations for U.S. crude supplies to climb +2.2 million bbl when the EIA reports weekly inventory data later today. Jun gasoline (RBM14 -0.58%) is down -0.50%. Jun gold (GCM14 -0.42%) is down -0.29%. July copper (HGN14 -0.16%) is up +0.02%. Agriculture and livestock prices are lower. The dollar index (DXY00 -0.16%) is down -0.09%. EUR/USD (^EURUSD) is up +0.12% as it recovered from a 3-week low on speculation that the +0.7% y/y increase in the Eurozone Apr CPI estimate is not low enough to warrant additional ECB easing. USD/JPY (^USDJPY) is down -0.06%. June T-note prices (ZNM14 -0.06%) are down -3.5 ticks.The Eurozone Apr CPI estimate rose at a +0.7% y/y pace, less than expectations of +0.8% y/y, but higher than the +0.5% y/y increase from Mar. Apr core CPI rose at a +1.0% y/y pace, right on expectations.
German Apr unemployment fell -25,000, a bigger drop than expectations of -10,000 and the Apr unemployment rate remained unchanged at 6.7%, right on expectations and the lowest since data for a reunified Germany began in 1991.
German Mar retail sales fell -0.7% m/m, right on expectations, and an annual basis unexpectedly fell -1.9% y/y, weaker than expectations of +1.7% y/y and the biggest y/y decline in 9 months.
Japan Mar industrial production rose +0.3% m/m and +7.0% y/y, less than expectations of +0.5% m/m and +7.2% y/y.
Japan Mar labor cash earnings rose +0.7% y/y, well above expectations of +0.1% y/y and the largest increase in 2 years.
UK Apr GfK consumer confidence rose +2 to -3, better than expectations of +1 to -4 and the highest in 6-3/4 years.
U.S. STOCK PREVIEW
Today’s April ADP employment report is expected to show a solid increase of +210,000, improving from +191,000 in March. The ADP report dipped to +121,000 in January but then recovered to +178,000 in Feb and +191,000 in March. Today’s Q1 GDP is expected to dip to +1.2% (q/q annualized) from +2.6% in Q1 due to the disruptions seen over the winter from the bad weather. Meanwhile, Q1 personal consumption is expected to fall to +2.0% from +3.3% in Q4 as consumer spending was dampened by the bad winter weather. Today’s April Chicago PMI report is expected to show a +1.1 point increase to 57.0, recovering some of the -3.9 point decline to 55.9 seen in March. The market is unanimously expecting the FOMC today to cut QE3 by another $10 billion to $45 billion and leave its funds rate target range unchanged at zero to 0.25%.There are 28 of the S&P 500 companies that report earnings today. Notable reports include Time Warner (consensus $0.88), ADP (1.08), Exelon (0.68), International Paper (0.54), Garmin (0.44), Southern Co (0.56), Phillips 66 (1.35), Murphy Oil (0.97), Equity Residential (0.71), Williams Companies (0.24), MetLife (1.40). Equity conferences during the remainder of this week include: Barclays Retail and Consumer Discretionary Conference on Tue-Wed, and Linley Group Mobile Conference on Wed-Thu.
OVERNIGHT U.S. STOCK MOVERS
Time Warner (TWX -0.52%) reported Q1 EPS of 97 cents, better than consensus of 88 cents.WellPoint (WLP +0.45%) reported Q1 EPS of $2.30, stronger than consensus of $2.08.
Genworth (GNW +2.35%) reported Q1 operating EPS of 39 cents, higher than consensus of 35 cents.
Marriott (MAR +1.16%) reported Q1 EPS of 57 cents, better than consensus of 51 cents.
Columbia Sportswear (COLM +2.88%) reported Q1 EPS of 63 cents, nearly double consensus of 33 cents.
U.S. Steel (X +2.37%) reported Q1 EPS of 34 cents, higher than consensus of 32 cents.
Hound Partners reported a 7.08% passive stake in Tesoro (TSO -0.21%) .
Owens-Illinois (OI +0.13%) reported Q1 adjusted EPS of 62 cents, better than consensus of 61 cents.
Hanover Insurance (THG +0.48%) reported Q1 operating EPS of $1.05, higher than consensus of 96 cents.
Team Health (TMH -0.50%) reported Q1 adjusted EPS of 54 cents, stronger than consensus of 50 cents.
NCR (NCR -1.60%) reported Q1 non-GAAP EPS of 50 cents, higher than consensus of 49 cents.
eBay (EBAY +1.68%) dropped over 4% in after-hours trading after it reported Q1 adjusted EPS of 70 cents, better than consensus of 67 cents, but then said Q2 revenue would be $4.325 billion-$4.425 billion, at the low end of consensus of $4.4 billion.
Express Scripts (ESRX +0.59%) fell oveer 3% in after-hours trading after it reported Q1 adjusted EPS of 99 cents, right on consensus, but then lowered guidance on fiscal 2014 adjusted EPS view to $4.82-$4.94 from $4.88-$5.00, at the low end of consensus of $4.89.
AMC Entertainment (AMC -0.49%) unexpectedly reported a Q1 EPS loss of -5 cents, weaker than consensus of a 2 cent gain.
Twitter (TWTR +4.64%) slumped 11% in after-hours trading after it reported Q1 adjusted EPS of 0 cents, better than consensus for a -3 cent loss, but then said it sees fiscal 2014 revenue of $1.2 billion-$1.25 billion, on the low end of consensus of $1.24 billion.
Edison International (EIX -0.54%) reported Q1 adjusted EPS of 90 cents, better than consensus of 82 cents.
Seagate (STX +1.69%) reported Q3 EPS of $1.34, higher than consensus of $1.25.
MARKET COMMENTS
June E-mini S&Ps (ESM14 -0.08%) this morning are down -2.00 points (-0.11%). The S&P 500 index on Tuesday closed higher. Bullish factors included (1) strong Q1 company earnings results as 74% of the 274 S&P 500 companies that have posted Q1 earnings results thus far have beaten estimates, and (2) carry-over support from a rally in European stocks after Moody's Investors Service raised its outlook on the Greek banking system to stable from negative and after Eurozone Apr consumer confidence was revised higher by +0.1 to a 6-1/2 year high of -8.6. Limiting gains in stocks was the unexpected -1.6 point decline in U.S. Apr consumer confidence (Conference Board) to 82.3, weaker than expectations of a +1.0 point increase to 83.3. Closes: S&P 500 +0.48%, Dow Jones +0.53%, Nasdaq +0.82%.Jun 10-year T-notes (ZNM14 -0.06%) this morning are down -3.5 ticks ahead of the outcome of today's FOMC meeting. Jun 10-year T-note futures prices on Tuesday closed lower. Bearish factors included (1) reduced safe-haven demand for T-notes as stocks rallied, and (2) expectations for the Fed to taper QE3 by $10 billion on Wed. T-note prices recovered from their worst levels after U.S. Apr consumer confidence unexpectedly declined. Closes: TYM4 -3.0, FVM4 -2.50.
The dollar index (DXY00 -0.16%) this morning is down -0.068 (-0.09%). EUR/USD (^EURUSD) is up +0.0017 (+0.12%). USD/JPY (^USDJPY) is down -0.06 (-0.06%). The dollar index on Tuesday closed higher: Dollar index +0.125 (+0.16%), EUR/USD -0.0030 (-0.28%), USD/JPY +0.149 (+0.15%). Bullish factors for the dollar included (1) weakness in EUR/USD after German Apr CPI rose less than expected, which increases deflation concerns in the Eurozone and fueled speculation the ECB may boost stimulus measures when it convenes next week, and (2) the rally in USD/JPY to a 3-week high after a rally in stocks reduced the safe-haven demand for the yen.
Jun WTI crude oil (CLM14 -1.14%) this morning is down -85 cents (-0.84%) at a 3-week low. Jun gasoline (RBM14 -0.58%) is down -0.0151 (=0.50%). Jun crude and gasoline prices on Tuesday closed higher. Bullish factors included (1) expectations that weekly EIA data on Wed will show crude supplies at Cushing, OK, the delivery point for WTI futures, fell to a fresh 4-1/2 year low, and (2) expectations for weekly EIA gasoline inventories on Wed to fall 450,000 bbl to a new 5-month low: Closes: CLM4 +0.44 (+0.44%). RBM4 +0.0216 (+0.72%).
GLOBAL EVENT CALENDAR04/30/2014
| US | 0700 ET | Weekly MBA mortgage applications, previous -3.3% with purchase sub-index -2.6% and refi sub-index -3.7%. |
| 0815 ET | Apr ADP employment change expected +210,000, Mar +191,000. | |
| 0830 ET | Q1 employment cost index expected +0.5%, Q4 +0.5%. | |
| 0830 ET | Q1 GDP expected +1.2% (q/q annualized), Q4 +2.6%. Q1 personal consumption expected +2.0%, Q4 +3.3%. Q1 GDP price index expected +1.6%, Q4 +1.6%, Q1 core PCE deflator expected +1.2%, Q4 +1.3%. | |
| 0900 ET | Treasury announces amounts of 3-year T-notes (previous $30 billion), 10-year T-notes (previous $21 billion) and 30-year T-bonds (previous $13 billion) to be auctioned in the Treasurys quarterly refunding May 6-8. | |
| 0945 ET | Apr Chicago PMI expected +1.1 to 57.0, Mar -3.9 to 55.9. | |
| 1030 ET | EIA Weekly Petroleum Status Report. | |
| 1400 ET | FOMC announces policy decision. QE3 expected to be cut by another $10 billion to $45 billion ($25 bln of Treasuries, $20 bln of MBS). Federal funds rate target range of zero to 0.25% expected unchanged. | |
| 1530 ET | Former Fed Chairman Ben Bernanke speaks at the Brookings Institute on Liquidity and the Role of the Lender of Last Resort. | |
| JPN | 0000 ET | Japan Mar vehicle production, Feb +7.1% y/y. |
| 0100 ET | Japan Mar construction orders, Feb +12.3% y/y. | |
| 0100 ET | Japan Mar housing starts expected -2.7% y/y to 894,000, Feb +1.0% y/y to 919,000. | |
| 0230 ET | BOJ chief Kuroda after BOJ policy meeting delivers press briefing after BOJ releases its semi-annual outlook report. | |
| GER | 0200 ET | German Mar retail sales expected -0.7% m/m and +1.7% y/y, Feb +1.3% m/m and +2.0% y/y. |
| 0355 ET | German Apr unemployment change expected -10,000, Mar -12,000. Apr unemployment rate expected unch at 6.7%, Mar 6.7%. | |
| EUR | 0500 ET | Eurozone Apr CPI estimate expected +0.8% y/y, Mar +0.5% y/y. Apr core CPI expected +1.0% y/y, Mar core CPI +0.7% y/y. |
| CHI | 2130 ET | China Apr manufacturing PMI (National Bureau of Statistics) expected +0.2 to 50.5, Mar +0.1 to 50.3. |
U.S. STOCK CALENDAR04/30/2014
| Company Name | Ticker | Time | Event Description | Period | Estimate |
|---|---|---|---|---|---|
| Time Warner Inc | TWX US | Bef-mkt | Q1 2014 Earnings Release | Q1 2014 | 0.88 |
| Hess Corp | HES US | Bef-mkt | Q1 2014 Earnings Release | Q1 2014 | 1.014 |
| Hospira Inc | HSP US | Bef-mkt | Q1 2014 Earnings Release | Q1 2014 | 0.494 |
| MeadWestvaco Corp | MWV US | Bef-mkt | Q1 2014 Earnings Release | Q1 2014 | 0.231 |
| Automatic Data Processing Inc | ADP US | Bef-mkt | Q3 2014 Earnings Release | Q3 2014 | 1.08 |
| Exelon Corp | EXC US | Bef-mkt | Q1 2014 Earnings Release | Q1 2014 | 0.676 |
| Dominion Resources Inc/VA | D US | Bef-mkt | Q1 2014 Earnings Release | Q1 2014 | 0.966 |
| NextEra Energy Inc | NEE US | Bef-mkt | Q1 2014 Earnings Release | Q1 2014 | 1.07 |
| International Paper Co | IP US | Bef-mkt | Q1 2014 Earnings Release | Q1 2014 | 0.539 |
| WellPoint Inc | WLP US | 6:00 | Q1 2014 Earnings Release | Q1 2014 | 2.075 |
| NiSource Inc | NI US | 6:30 | Q1 2014 Earnings Release | Q1 2014 | 0.787 |
| ADT Corp/The | ADT US | 7:00 | Q2 2014 Earnings Release | Q2 2014 | 0.434 |
| Actavis plc | ACT US | 7:00 | Q1 2014 Earnings Release | Q1 2014 | 3.229 |
| Wisconsin Energy Corp | WEC US | 7:00 | Q1 2014 Earnings Release | Q1 2014 | 0.845 |
| Garmin Ltd | GRMN US | 7:00 | Q1 2014 Earnings Release | Q1 2014 | 0.439 |
| Southern Co/The | SO US | 7:30 | Q1 2014 Earnings Release | Q1 2014 | 0.564 |
| Sealed Air Corp | SEE US | 7:30 | Q1 2014 Earnings Release | Q1 2014 | 0.247 |
| Dun & Bradstreet Corp/The | DNB US | 8:00 | Q1 2014 Earnings Call | Q1 2014 | |
| Owens-Illinois Inc | OI US | 8:00 | Q1 2014 Earnings Call | Q1 2014 | |
| Pitney Bowes Inc | PBI US | 8:00 | Q1 2014 Earnings Release | Q1 2014 | 0.404 |
| Pitney Bowes Inc | PBI US | 8:00 | Q1 2014 Earnings Call | Q1 2014 | |
| EQT Corp | EQT US | 8:00 | Annual General Meeting | Y 2014 | |
| Genworth Financial Inc | GNW US | 8:00 | Q1 2014 Earnings Call | Q1 2014 | |
| Phillips 66 | PSX US | 8:00 | Q1 2014 Earnings Release | Q1 2014 | 1.345 |
| WellPoint Inc | WLP US | 8:30 | Q1 2014 Earnings Call | Q1 2014 | |
| Automatic Data Processing Inc | ADP US | 8:30 | Q3 2014 Earnings Call | Q3 2014 | |
| ACE Ltd | ACE US | 8:30 | Q1 2014 Earnings Call | Q1 2014 | |
| ADT Corp/The | ADT US | 8:30 | Q2 2014 Earnings Call | Q2 2014 | |
| United States Steel Corp | X US | 8:30 | Q1 2014 Earnings Call | Q1 2014 | |
| Actavis plc | ACT US | 8:30 | Q1 2014 Earnings Call | Q1 2014 | |
| Express Scripts Holding Co | ESRX US | 8:30 | Q1 2014 Earnings Call | Q1 2014 | |
| CH Robinson Worldwide Inc | CHRW US | 8:30 | Q1 2014 Earnings Call | Q1 2014 | |
| Aflac Inc | AFL US | 9:00 | Q1 2014 Earnings Call | Q1 2014 | |
| NiSource Inc | NI US | 9:00 | Q1 2014 Earnings Call | Q1 2014 | |
| Hospira Inc | HSP US | 9:00 | Q1 2014 Earnings Call | Q1 2014 | |
| NextEra Energy Inc | NEE US | 9:00 | Q1 2014 Earnings Call | Q1 2014 | |
| International Paper Co | IP US | 9:00 | Q1 2014 Earnings Call | Q1 2014 | |
| Hess Corp | HES US | 10:00 | Q1 2014 Earnings Call | Q1 2014 | |
| Marathon Petroleum Corp | MPC US | 10:00 | Annual General Meeting | Y 2014 | |
| MeadWestvaco Corp | MWV US | 10:00 | Q1 2014 Earnings Call | Q1 2014 | |
| Marriott International Inc/DE | MAR US | 10:00 | Q1 2014 Earnings Call | Q1 2014 | |
| Sealed Air Corp | SEE US | 10:00 | Q1 2014 Earnings Call | Q1 2014 | |
| Dominion Resources Inc/VA | D US | 10:00 | Q1 2014 Earnings Call | Q1 2014 | |
| EMC Corp/MA | EMC US | 10:00 | Annual General Meeting | Y 2014 | |
| Boston Properties Inc | BXP US | 10:00 | Q1 2014 Earnings Call | Q1 2014 | |
| Time Warner Inc | TWX US | 10:30 | Q1 2014 Earnings Call | Q1 2014 | |
| Accenture PLC | ACN US | 10:30 | Accenture Digital and Highlights Companys Technology Call | ||
| Garmin Ltd | GRMN US | 10:30 | Q1 2014 Earnings Call | Q1 2014 | |
| Exelon Corp | EXC US | 11:00 | Q1 2014 Earnings Call | Q1 2014 | |
| Newfield Exploration Co | NFX US | 11:00 | Q1 2014 Earnings Call | Q1 2014 | |
| Marathon Oil Corp | MRO US | 11:00 | Annual General Meeting | Y 2014 | |
| WW Grainger Inc | GWW US | 11:00 | Annual General Meeting | Y 2014 | |
| Phillips 66 | PSX US | 11:00 | Q1 2014 Earnings Call | Q1 2014 | |
| McGraw Hill Financial Inc | MHFI US | 11:00 | Annual General Meeting | Y 2014 | |
| Ameriprise Financial Inc | AMP US | 12:00 | Annual General Meeting | Y 2014 | |
| Southern Co/The | SO US | 13:00 | Q1 2014 Earnings Call | Q1 2014 | |
| Macerich Co/The | MAC US | 13:30 | Q1 2014 Earnings Call | Q1 2014 | |
| Wisconsin Energy Corp | WEC US | 14:00 | Q1 2014 Earnings Call | Q1 2014 | |
| CBRE Group Inc | CBG US | 16:00 | Q1 2014 Earnings Release | Q1 2014 | 0.166 |
| Allegion PLC | ALLE US | 17:00 | Q1 2014 Earnings Release | Q1 2014 | 0.44 |
| CBRE Group Inc | CBG US | 17:00 | Q1 2014 Earnings Call | Q1 2014 | |
| Western Digital Corp | WDC US | 17:00 | Q3 2014 Earnings Release | Q3 2014 | 1.876 |
| Western Digital Corp | WDC US | 17:00 | Q3 2014 Earnings Call | Q3 2014 | |
| Murphy Oil Corp | MUR US | Aft-mkt | Q1 2014 Earnings Release | Q1 2014 | 0.971 |
| Equity Residential | EQR US | Aft-mkt | Q1 2014 Earnings Release | Q1 2014 | 0.714 |
| Beam Inc | BEAM US | Aft-mkt | Under Armor Inc. Replaces Beam Inc. in S&P 500 | ||
| Tesoro Corp | TSO US | Aft-mkt | Q1 2014 Earnings Release | Q1 2014 | 0.387 |
| Williams Cos Inc/The | WMB US | Aft-mkt | Q1 2014 Earnings Release | Q1 2014 | 0.243 |
| Lincoln National Corp | LNC US | Aft-mkt | Q1 2014 Earnings Release | Q1 2014 | 1.296 |
| MetLife Inc | MET US | Aft-mkt | Q1 2014 Earnings Release | Q1 2014 | 1.395 |
| SLM Corp | SLM US | Aft-mkt | Navient Corp. Replaces SLM Corp. in S&P 500 | ||
| BorgWarner Inc | BWA US | Annual General Meeting | |||
| Ball Corp | BLL US | Annual General Meeting | |||
| TECO Energy Inc | TE US | Annual General Meeting |
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