Tuesday, October 21, 2014

BARCHART MORNING CALL 10/21

OVERNIGHT MARKETS AND NEWS
December E-mini S&Ps (ESZ14 +0.74%) this morning are up +0.67% at a 1-week high and European stocks are up +1.61% as Apple rose 2% in pre-market trading after it reported stronger-than-expected Q4 earnings results late yesterday. Another supportive factor for stocks was strength in the Chinese economy after Q3 China GDP grew more than expected. Asian stocks closed mixed: Japan -2.03%, Hong Kong +0.08%, China -0.87%, Taiwan -0.10%, Australia +0.11%, Singapore +0.68%, South Korea -0.99%, India +0.55%. Chinese stocks closed lower after the stronger-than-expected China Q3 GDP dampened speculation the government will boost economic stimulus measures. Commodity prices are mixed. Nov crude oil (CLX14 +0.27%) is up +0.58%. Nov gasoline (RBX14 +0.52%) is up +0.57%. Dec gold (GCZ14 +0.38%) is up +0.32% at a 1-1/4 month high on expectations the Fed may push back interest rate increases. Dec copper (HGZ14 +0.64%) is up +0.30%. Agriculture and livestock prices are mostly higher. The dollar index (DXY00 +0.27%) is up +0.23%. EUR/USD (^EURUSD) is down -0.35%. USD/JPY (^USDJPY) is down -0.06%. Dec T-note prices (ZNZ14 -0.12%) are down -8.5 ticks.
China Q3 GDP rose +1.9% q/q and +7.3% y/y, stronger than expectations of +1.8% q/q and +7.2% y/y. Despite beating expectations, the +7.3% y/y increase was the slowest pace of expansion in 5-1/2 years.
China Sep industrial production rose +8.0% y/y, better than expectations of +7.5% y/y.
China Sep retail sales climbed +11.6% y/y, less than expectations of +11.7% y/y and the slowest pace of growth in 3-1/2 years.
China Sep fixed assets investment (ex-rural households) rose +16.1% year-to-date y/y, less than expectations of +16.3% year-to-date y/y and the slowest pace of increase in 12-3/4 years.
UK Sep public sector net borrowing rose +11.1 billion pounds, more than expectations of +10.1 billion pounds.
Japan Aug all-industry activity index fell -0.1% m/m, a smaller decline than expectations of -0.4% m/m, but still the third consecutive monthly drop.
U.S. STOCK PREVIEW
The market is expecting today’s Sep existing home sales report to show a +1.0% increase to 5.10 million, reversing some of the -1.8% decline to 5.05 million seen in August.   There are 24 of the S&P 500 companies that report earnings today with notable reports including:  Lockheed Martin (2.72), Coca-Cola (0.53), United Technologies (1.81), Kimberly-Clark (1.54), Harley-Davidson (0.59), McDonald's (1.37), E-Trade (0.22), Intuitive Surgical (3.81), Yahoo (0.30).  Equity conferences during the remainder of this week include:  Latin Markets Private Wealth Latin America and the Caribbean Forum on Thu.
OVERNIGHT U.S. STOCK MOVERS
Lockheed Martin (LMT -0.40%) reported Q3 EPS of $2.76, higher than consensus of $2.72.
Harley-Davidson (HOG -0.43%) reported Q3 EPS of 69 bents, better than consensus of 59 cents.
The Travelers Cos. (TRV -0.04%) reported Q3 EPS of $2.61, well above consensus of $2.26.
Verizon (VZ +0.85%) reported Q3 EPS of 89 cents, less than consensus of 90 cents.
Brown & Brown (BRO +0.75%) reported Q3 EPS of 47 cents, right on consensus, although Q3 revenue of $421.3 million was slightly less than consensus of $425.4 million.
SAB Capital Advisors reported a 5.1% passive stake in Men's Wearhouse (MW +0.65%) .
Celanese (CE +2.13%) reported Q3 adjusted EPS of $1.61, much better than consensus $1.44, and then raised guiadance on fiscal 2014 adjusted EPS view to $5.55-$5.65, well above consensus of $5.33.
Texas Instruments (TXN +1.69%) gained 3% in after-hours trading ater it reported Q3 EPS of 76 cents, better than consensus of 71 cents.
Apple (AAPL +2.14%) climbed more than 2% in after-hours trading after it reported Q4 EPS of $1.42, well ahead of consensus of $1.31.
Rent-A-Center (RCII +0.25%) reported Q3 EPS of 48 cents, higher than consensus of 47 cents, although Q3 revenue of $769.5 million was below consensus of $773.32 million.
Illumina (ILMN -0.27%) rose more than 7% in after-hours trading after it reported Q3 adjusted EPS of 77 cents, much higher than consensus of 56 cents, and then raised guidance on fiscal 2014 EPS view to $2.63-$2.65, well ahead of consensus of $2.30.
Cadence Design (CDNS +0.73%) reported Q3 adjusted EPS of 26 cents, better than consensus of 24 cents.
Werner (WERN +1.22%) reported Q3 EPS of 36 cents, right on consensus, although Q3 revenue of $551.96 million was higher than consensus of $542.95 million.
Chipotle (CMG +1.76%) reported Q3 EPS of $4.15, well above consensus of $3.84.
MARKET COMMENTS
Dec E-mini S&Ps (ESZ14 +0.74%) this morning are up +12.75 points (+0.67%) at a 1-week high. The S&P 500 index on Monday closed higher: S&P 500 +0.91%, Dow Jones +0.12%, Nasdaq +1.43%. Bullish factors included (1) expectations for strong Q3 company earnings results as the estimate for Q3 S&P 500 company profits has been raised over the past 1-1/2 weeks, and (2) a rally in Apple that lifted technology stocks on expectations that increased iPhone 6 sales lifted Apple’s fiscal Q4 profit by +10%.
Dec 10-year T-notes (ZNZ14 -0.12%) this morning are down -8.5 ticks. Dec 10-year T-note futures prices on Monday closed higher. Closes: TYZ4 +5.50, FVZ4 +4.50. Bullish factors included (1) carry-over support from a rally in European government bonds after German Sep PPI fell -1.0% y/y, the largest year-over-year decline in 8 months, which may prompt he ECB to expand stimulus and (2) comments from Dallas Fed President Fisher suggesting the Fed may wait before raising interest rates when he said he wants to see how things proceed in the U.S. economy before raising interest rates.
The dollar index (DXY00 +0.27%) this morning is up +0.194 (+0.23%). EUR/USD (^EURUSD) is down -0.0045 (-0.35%). USD/JPY ^USDJPY) is down -0.06 (-0.06%). The dollar index on Monday closed lower after Dallas Fed President Fisher said that he wants to see how the things proceed in the U.S. economy before raising interest rates. Closes: Dollar index -0.157 (-0.18%), EUR/USD +0.00409 (+0.32%), USD/JPY +0.04 (+0.04%). USD/JPY moved higher as the yen weakened after the Nikkei newspaper reported that Japan’s $1.2 trillion Government Pension Investment Fund will increase its holdings of foreign stocks and bonds at the expense of Japanese assets, which is yen-negative.
Nov WTI crude oil (CLX14 +0.27%) this morning is up +48 cents (+0.58%) and Nov gasoline (RBX14 +0.52%) is up +0.0126 (+0.57%). Nov crude and Nov gasoline on Monday closed lower. Closes: CLX4 -0.04 (-0.06%), RBXX4 -0.0327 (-1.46%). Bearish factors included (1) speculation that OPEC won’t take any action to cut production and bolster crude prices before its next scheduled meeting late next month, and (2) expectations for Wednesday’s weekly EIA crude inventories to increase by +3.0 million bbl.
GLOBAL EVENT CALENDAR10/21/2014
US1000 ETSep existing home sales expected +1.0% to 5.10 million, Aug -1.8% to 5.05 million.
JPN0030 ETJapan Aug all-industry activity index expected -0.4%, Jul -0.2% m/m.
1950 ETJapan Sep trade balance expected -780.0 billion yen, Aug -949.7 billion yen. Sep exports expected +6.5% y/y, Aug -1.3% y/y. Sep imports expected +2.7% y/y, Aug -1.4% y/y.
UK0430 ETUK Sep public sector net borrowing expected +9.4 billion pounds, Aug +10.9 billion pounds.
U.S. STOCK CALENDAR10/21/2014
Company NameTickerTimeEvent DescriptionPeriodEstimate
Pentair PLCPNR USBef-mktQ3 2014 Earnings ReleaseQ3 20140.937
Omnicom Group IncOMC USBef-mktQ3 2014 Earnings ReleaseQ3 20140.899
Lockheed Martin CorpLMT USBef-mktQ3 2014 Earnings ReleaseQ3 20142.722
Allegheny Technologies IncATI USBef-mktQ3 2014 Earnings ReleaseQ3 2014-0.064
Regions Financial CorpRF USBef-mktQ3 2014 Earnings ReleaseQ3 20140.211
Coca-Cola Co/TheKO USBef-mktQ3 2014 Earnings ReleaseQ3 20140.527
United Technologies CorpUTX USBef-mktQ3 2014 Earnings ReleaseQ3 20141.809
Harley-Davidson IncHOG USBef-mktQ3 2014 Earnings ReleaseQ3 20140.594
Kimberly-Clark CorpKMB USBef-mktQ3 2014 Earnings ReleaseQ3 20141.543
Reynolds American IncRAI USBef-mktQ3 2014 Earnings ReleaseQ3 20140.91
McDonald's CorpMCD USBef-mktQ3 2014 Earnings ReleaseQ3 20141.365
Travelers Cos Inc/TheTRV US6:57Q3 2014 Earnings ReleaseQ3 20142.264
Waters CorpWAT US7:00Q3 2014 Earnings ReleaseQ3 20141.285
Verizon Communications IncVZ US7:30Q3 2014 Earnings ReleaseQ3 20140.899
Illinois Tool Works IncITW US8:00Q3 2014 Earnings ReleaseQ3 20141.233
Omnicom Group IncOMC US8:30Q3 2014 Earnings CallQ3 2014
Verizon Communications IncVZ US8:30Q3 2014 Earnings CallQ3 2014
Allegheny Technologies IncATI US8:30Q3 2014 Earnings CallQ3 2014
Waters CorpWAT US8:30Q3 2014 Earnings CallQ3 2014
Pentair PLCPNR US9:00Q3 2014 Earnings CallQ3 2014
Travelers Cos Inc/TheTRV US9:00Q3 2014 Earnings CallQ3 2014
United Technologies CorpUTX US9:00Q3 2014 Earnings CallQ3 2014
Harley-Davidson IncHOG US9:00Q3 2014 Earnings CallQ3 2014
Reynolds American IncRAI US9:00Q3 2014 Earnings CallQ3 2014
Coca-Cola Co/TheKO US9:30Q3 2014 Earnings CallQ3 2014
Illinois Tool Works IncITW US10:00Q3 2014 Earnings CallQ3 2014
Kimberly-Clark CorpKMB US10:00Q3 2014 Earnings CallQ3 2014
Lockheed Martin CorpLMT US11:00Q3 2014 Earnings CallQ3 2014
Regions Financial CorpRF US11:00Q3 2014 Earnings CallQ3 2014
McDonald's CorpMCD US11:00Q3 2014 Earnings CallQ3 2014
Robert Half International IncRHI US16:00Q3 2014 Earnings ReleaseQ3 20140.583
JPMorgan Chase & CoJPM US16:00Jamie Dimon Inverview-Reflections on Resilient Leadership""
ACE LtdACE US16:05Q3 2014 Earnings ReleaseQ3 20142.357
E*TRADE Financial CorpETFC US16:05Q3 2014 Earnings ReleaseQ3 20140.223
Intuitive Surgical IncISRG US16:30Q3 2014 Earnings CallQ3 2014
Broadcom CorpBRCM US16:45Q3 2014 Earnings CallQ3 2014
Robert Half International IncRHI US17:00Q3 2014 Earnings CallQ3 2014
E*TRADE Financial CorpETFC US17:00Q3 2014 Earnings CallQ3 2014
Yahoo! IncYHOO US17:00Q3 2014 Earnings CallQ3 2014
Discover Financial ServicesDFS US17:00Q3 2014 Earnings CallQ3 2014
Broadcom CorpBRCM USAft-mktQ3 2014 Earnings ReleaseQ3 20140.839
Nabors Industries LtdNBR USAft-mktQ3 2014 Earnings ReleaseQ3 20140.361
FMC Technologies IncFTI USAft-mktQ3 2014 Earnings ReleaseQ3 20140.735
Intuitive Surgical IncISRG USAft-mktQ3 2014 Earnings ReleaseQ3 20143.808
Yahoo! IncYHOO USAft-mktQ3 2014 Earnings ReleaseQ3 20140.296
Discover Financial ServicesDFS USAft-mktQ3 2014 Earnings ReleaseQ3 20141.338
Vertex Pharmaceuticals IncVRTX USFDA Adcomm, Kalydeco, cystic fibrosis patients with R117H CFTR mutation
Cintas CorpCTAS USAnnual General Meeting
Posted by Jim Van Meerten at
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