Thursday, October 16th, 2014View Older Reports
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OVERNIGHT MARKETS AND NEWS
December E-mini S&Ps (ESZ14 -1.19%) this morning are down -1.31% and European stocks are down -2.04% at a 13-1/4 month low as global stocks continue their downside correction. Greek government bonds plunged as the 10-year Greek bond yield surged 81 bp to a 9-month high of 8.66% on concern the government won't be able to fund itself adequately if it sticks to plans to leave an international bailout program early. Spain's 10-year government bond yield jumped 23 bp to a 1-month high of 2.34% after it sold 3.2 billion euros of 10-year and 15-year debt, less than a target of 3.5 billion euros. The S&P 500 had recovered from a 6-month low late yesterday and traded higher early in the overnight electronic session after Fed Chair Yellen told a private meeting of the Group of 30 that "she expressed confidence" in the U.S. economic outlook and the economy looked to be on track to achieve growth of around 2%, according to two people familiar with her comments. Asian stocks closed mostly lower: Japan -2.22%, Hong Kong -1.03%, China -0.79%, Taiwan -0.25%, Australia +0.18%, Singapore -1.39%, South Korea -0.44%, India -1.33%. Japanese banks and exporters tumbled and led the overall market lower as the Nikkei Stock Index fell to a 4-1/2 month low, while China's Shanghai Stock Index erased gains and closed lower after a gauge of new credit rose less than expected. Commodity prices are mostly lower. Nov crude oil (CLX14 -1.80%) is down -1.91%. Nov gasoline (RBX14 -0.21%) is down -0.29%. Dec gold (GCZ14 -0.14%) is down -0.17%. Dec copper (HGZ14 -1.40%) is down -1.68% at a 7-month low on global demand concerns amid increasing supplies after LME copper inventories surged +3,025 MT to a 2-3/4 month high of 157,675 MT. Agriculture and livestock prices are mostly lower. The dollar index (DXY00 +0.06%) is up +0.14%. EUR/USD (^EURUSD) is down -0.76%. USD/JPY (^USDJPY) is down -0.26% as the global stock market rout boosts the safe-haven demand of the yen. Dec T-note prices (ZNZ14 +0.53%) are up +21.5 ticks.China Sep new yuan loans rose +857.2 billion yuan, more than expectations of +750.0 billion yuan, Sep aggregate financing, China's broadest measure of new credit, rose +1.05 trillion yuan, a 3-month high but slightly less than expectations of +1.15 trillion yuan.
China Sep foreign direct investment unexpectedly rose +1.9% y/y, better than expectations of -14.0% y/y and the first increase in 3 months.
Eurozone Sep CPI rose +0.4% m/m, right on expectations and on an annual basis was left unrevised at +0.3% y/y. The Sep core CPI was revised upward to +0.8% y/y from the originally reported +0.7% y/y.
U.S. STOCK PREVIEW
The market is expecting today’s weekly unemployment claims report to show small changes and remain favorable, near recent 8-1/2 year lows. The market is looking for a favorable Sep industrial production report today after August’s weak report. The market is expecting today’s Oct NAHB housing market index to be unchanged from September’s 8-3/4 year high of 59.There are 22 of the S&P 500 companies that report earnings today with notable reports including: Goldman Sachs (consensus $3.21), Google (6.53), Capital One (1.94), Fifth Third (0.43), Schlumberger (1.46), Baxter (1.31), UnitedHealth Group (1.53), Delta Air (1.18), PPG Industries (2.76). Equity conferences during the remainder of this week include: Bloomberg Next Big Thing Summit: East on Thu, and 5th Annual Global Automotive Forum on Thu.
OVERNIGHT U.S. STOCK MOVERS
Mattel (MAT -0.39%) reported Q3 EPS of 98 cents, below consensus of $1.02.Fifth Third Bancorp (FITB -3.48%) reported Q3 EPS of 39 cents, less than consensus of 43 cents.
Baxter International (BAX -0.76%) reported Q3 EPS of $1.35, better than consensus of $1.31.
UnitedHealth Group (UNH -0.80%) reported Q3 EPS of $1.63, higher than consensus of $1.53.
Goldman Sachs (GS -0.82%) reported Q3 EPS of $4.57, well above consensus of $3.21.
Integrated Core Strategies reported a 4.9% passive stake in Dynegy (DYN -1.20%) .
HNI Corporation (HNI +0.39%) reported Q3 EPS of 81 cents, well above consensus of 71 cents, and then raised guidance on fiscal 2014 EPS view to $1.95-$2.00, better than consensus of $1.82.
Transocean (RIG +1.62%) said it received $610 million in new contracts since its September 22 fleet update.
United Rentals (URI +1.06%) rose over 2% in after-hours trading after it reported Q3 adjusted EPS of $2.20, higher than consensus of $2.08.
eBay (EBAY -0.69%) slipped over 2% in after-hours trading after it reported Q3 EPS of 68 cents, better than consensus of 67 cents, although Q3 revenue of $4.35 billion was below consensus of $4.37 billion. The company then lowered gidance on fiscal 2014 revenue to $17.85 billion - $17.95 billion, weaker than consensus of $18.15 billion.
Las Vegas Sands (LVS +1.19%) reported Q3 EPS of 84 cents, lower than consensus of 85 cents.
American Express (AXP -2.19%) reported Q3 EPS of $1.40, higher than consensus of $1.36.
Netflix (NFLX -0.12%) plunged over 20% in after-hours trading after it reported Q3 EPS of 96 cents, better than consensus of 93 cents, but then said its sees Q4 EPS of only 44 cents, well below consensus of 85 cents.
Universal Forest (UFPI +4.29%) reported Q3 EPS of 96 cents, weaker than consensus of 99 cents.
MARKET COMMENTS
Dec E-mini S&Ps (ESZ14 -1.19%) this morning are down -24.25 points (-1.31%). The S&P 500 index on Wednesday slumped to a 6-month low and closed lower. S&P 500 -0.81%, Dow Jones -1.06%, Nasdaq -0.64%. Bearish factors included (1) economic concerns after U.S. Sep retail sales ex-autos unexpectedly fell -0.2%, weaker than expectations of +0.2%, and (2) a fall in airline stocks on concern over the spread of the Ebola virus after a second health-care worker tested positive for the virus and flew on a commercial flight the day before. Stocks recovered from their worst levels on the upbeat Fed Beige Book.Dec 10-year T-notes (ZNZ14 +0.53%) this morning are up +21.5 ticks. Dec 10-year T-note futures prices on Wednesday rallied sharply to a contract high and the yield on the 10-year T-note yield plummeted to a 1-1/3 year low of 1.862%. Closes: TYZ4 +1-4.00/32, FVZ4 +22.75. Bullish factors include (1) weaker-than-expected U.S. economic data on Sep retail sales and Oct Empire manufacturing that fueled massive capitulation by short-positions as the weak global economic data virtually eliminates the chance of a Fed rate hike in the first half of 2015, and (2) carry-over support from a rally in German bunds to a record high as the 10-year German bund yield tumbled to an all-time low of 0.719%.
The dollar index (DXY00 +0.06%) this morning is up +0.121 (+0.14%). EUR/USD (^EURUSD) is down -0.0098 (-0.76%). USD/JPY (^USDJPY) is down -0.28 (-0.26%). The dollar index on Wednesday fell to a 3-week low and closed lower. Closes: Dollar index -0.675 (-0.79%), EUR/USD +0.01802 (+1.42%), USD/JPY -1.136 (-1.06%). Bearish factors included (1) U.S. economic concerns that dampened speculation the Fed will raise interest rates anytime soon after Sep retail sales fell more than expected, and (2) strength in the yen after USD/JPY rose to a 5-week high as the slump in stocks boosted safe-haven demand for the yen.
Nov WTI crude oil (CLX14 -1.80%) this morning is down -$1.56 (-1.91%) and Nov gasoline (RBX14 -0.21%) is down -0.0063 (-0.29%). Nov crude and Nov gasoline prices on Wednesday closed lower with Nov crude at a 2-1/3 year low and Nov gasoline at a 3-3/4 year low. Closes: CLX4 -0.06 (-0.07%), RBXX4 -0.0315 (-1.44%). Bearish factors included (1) weaker-than-expected U.S. economic data on Sep retail sales and Oct Empire manufacturing activity, and (2) expectations for Thursday’s weekly EIA crude inventories to increase +2.5 million bbl. Prices rose from their worst levels after the dollar index tumbled to a 3-week low.
GLOBAL EVENT CALENDAR10/16/2014
| US | 0800 ET | Philadelphia Fed President Charles Plosser speaks on the economic outlook to the Lehigh Valley Economic Development Group. |
| 0830 ET | Weekly initial unemployment claims expected +3,000 to 290,000, previous -1,000 to 287,000. Weekly continuing claims expected -1,000 to 2.380 million, previous -21,000 to 2.381 million. | |
| 0900 ET | Atlanta Fed President Dennis Lockhart speaks at a conference at Rutgers University on Transforming U.S. Workforce Development Policies for the 21st Century. | |
| 0915 ET | Sep industrial production expected +0.4% m/m, Aug -0.1% m/m. Sep manufacturing production expected +0.3% m/m, Aug -0.4% m/m. Sep capacity utilization expected +0.2 to 79.0%, Aug -0.3 to 78.8%. | |
| 1000 ET | Minneapolis Fed President Narayana Kocherlakota delivers a speech titled Clarifying the Objectives of Monetary Policy at an event in Billings, MT. | |
| 1000 ET | Oct Philadelphia Fed manufacturing index expected -2.8 to 19.7, Sep -5.5 to 22.5. | |
| 1000 ET | Oct NAHB housing market index expected unch at 59, Sep +4 to 59. | |
| 1100 ET | EIA Weekly Petroleum Status Report. | |
| 1100 ET | Treasury announces amount of 30-year TIPS to be auctioned Oct 23. | |
| EUR | 0500 ET | Revised Eurozone Sep CPI, Sep prelim +0.4% y/y. Revised Sep core CPI, Sep prelim +0.7% y/y. |
| 0500 ET | Eurozone Aug trade balance (sa) expected 13.3 billion euros, July 12.2 billion euros. |
U.S. STOCK CALENDAR10/16/2014
| Company Name | Ticker | Time | Event Description | Period | Estimate |
|---|---|---|---|---|---|
| PPG Industries Inc | PPG US | Bef-mkt | Q3 2014 Earnings Release | Q3 2014 | 2.757 |
| Delta Air Lines Inc | DAL US | Bef-mkt | Q3 2014 Earnings Release | Q3 2014 | 1.176 |
| BB&T Corp | BBT US | 5:45 | Q3 2014 Earnings Release | Q3 2014 | 0.717 |
| Danaher Corp | DHR US | 6:00 | Q3 2014 Earnings Release | Q3 2014 | 0.892 |
| UnitedHealth Group Inc | UNH US | 6:00 | Q3 2014 Earnings Release | Q3 2014 | 1.529 |
| Mattel Inc | MAT US | 6:00 | Q3 2014 Earnings Release | Q3 2014 | 1.02 |
| Baker Hughes Inc | BHI US | 6:30 | Q3 2014 Earnings Release | Q3 2014 | 1.131 |
| Fifth Third Bancorp | FITB US | 6:30 | Q3 2014 Earnings Release | Q3 2014 | 0.429 |
| Baxter International Inc | BAX US | 7:00 | Q3 2014 Earnings Release | Q3 2014 | 1.309 |
| Philip Morris International Inc | PM US | 7:00 | Q3 2014 Earnings Release | Q3 2014 | 1.334 |
| Snap-on Inc | SNA US | 7:00 | Q3 2014 Earnings Release | Q3 2014 | 1.618 |
| Dover Corp | DOV US | 7:00 | Q3 2014 Earnings Release | Q3 2014 | 1.313 |
| Goldman Sachs Group Inc/The | GS US | 7:30 | Q3 2014 Earnings Release | Q3 2014 | 3.214 |
| WW Grainger Inc | GWW US | 7:30 | Q3 2014 Earnings Release | Q3 2014 | 3.287 |
| Alliance Data Systems Corp | ADS US | 7:30 | Q3 2014 Earnings Release | Q3 2014 | 3.307 |
| Navient Corp | NAVI US | 8:00 | Q3 2014 Earnings Call | Q3 2014 | |
| BB&T Corp | BBT US | 8:00 | Q3 2014 Earnings Call | Q3 2014 | |
| Danaher Corp | DHR US | 8:00 | Q3 2014 Earnings Call | Q3 2014 | |
| WW Grainger Inc | GWW US | 8:00 | Q3 2014 Earnings Call | Q3 2014 | |
| Baker Hughes Inc | BHI US | 8:30 | Q3 2014 Earnings Call | Q3 2014 | |
| Baxter International Inc | BAX US | 8:30 | Q3 2014 Earnings Call | Q3 2014 | |
| Alliance Data Systems Corp | ADS US | 8:30 | Q3 2014 Earnings Call | Q3 2014 | |
| Mattel Inc | MAT US | 8:30 | Q3 2014 Earnings Call | Q3 2014 | |
| UnitedHealth Group Inc | UNH US | 8:45 | Q3 2014 Earnings Call | Q3 2014 | |
| Philip Morris International Inc | PM US | 9:00 | Q3 2014 Earnings Call | Q3 2014 | |
| Fifth Third Bancorp | FITB US | 9:00 | Q3 2014 Earnings Call | Q3 2014 | |
| Goldman Sachs Group Inc/The | GS US | 9:30 | Q3 2014 Earnings Call | Q3 2014 | |
| Snap-on Inc | SNA US | 10:00 | Q3 2014 Earnings Call | Q3 2014 | |
| Dover Corp | DOV US | 10:00 | Q3 2014 Earnings Call | Q3 2014 | |
| Delta Air Lines Inc | DAL US | 10:00 | Q3 2014 Earnings Call | Q3 2014 | |
| United Rentals Inc | URI US | 11:00 | Q3 2014 Earnings Call | Q3 2014 | |
| Apple Inc | AAPL US | 11:30 | Special Media Event | ||
| PPG Industries Inc | PPG US | 14:00 | Q3 2014 Earnings Call | Q3 2014 | |
| Stryker Corp | SYK US | 16:00 | Q3 2014 Earnings Release | Q3 2014 | 1.138 |
| People's United Financial Inc | PBCT US | 16:00 | Q3 2014 Earnings Release | Q3 2014 | 0.211 |
| Capital One Financial Corp | COF US | 16:05 | Q3 2014 Earnings Release | Q3 2014 | 1.941 |
| Xilinx Inc | XLNX US | 16:20 | Q2 2015 Earnings Release | Q2 2015 | 0.556 |
| Google Inc | GOOGL US | 16:30 | Q3 2014 Earnings Call | Q3 2014 | |
| Stryker Corp | SYK US | 16:30 | Q3 2014 Earnings Call | Q3 2014 | |
| Capital One Financial Corp | COF US | 17:00 | Q3 2014 Earnings Call | Q3 2014 | |
| Xilinx Inc | XLNX US | 17:00 | Q2 2015 Earnings Call | Q2 2015 | |
| SanDisk Corp | SNDK US | 17:00 | Q3 2014 Earnings Call | Q3 2014 | |
| People's United Financial Inc | PBCT US | 17:00 | Q3 2014 Earnings Call | Q3 2014 | |
| Schlumberger Ltd | SLB US | Aft-mkt | Q3 2014 Earnings Release | Q3 2014 | 1.461 |
| Google Inc | GOOGL US | Aft-mkt | Q3 2014 Earnings Release | Q3 2014 | 6.533 |
| SanDisk Corp | SNDK US | Aft-mkt | Q3 2014 Earnings Release | Q3 2014 | 1.332 |
| Pfizer Inc | PFE US | FDA Adcomm, Chantix, risk of serious neuropsychiatric adverse events |
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