Tuesday, March 17th, 2015View Older Reports
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OVERNIGHT MARKETS AND NEWS
June E-mini S&Ps (ESM15 -0.33%) this morning are down -0.31% as the Fed begins a 2-day policy meeting to debate the timing of its first interest rate increase since 2006. European stocks are down -0.60% after a measure of German investor confidence rose less than expected. Losses in European stocks were contained as automakers rallied after Eurozone Feb auto sales rose by the most in 11 months. Asian stocks closed mostly higher: Japan +0.99%, Hong Kong -0.20%, China +1.39%, Taiwan +0.28%, Australia +0.77%, Singapore -0.18%, South Korea +2.27%, India +1.05%. Japan's Nikkei Stock Index climbed to a 14-3/4 year high after the BOJ maintained record stimulus following a 2-day policy meeting and China's Shanghai Stock Index rose to a 6-3/4 year high on speculation the government will boost stimulus to revive the economy. Commodity prices are mostly lower. Apr crude oil (CLJ15 -2.28%) is down -1.71%. Apr gasoline (RBJ15 -1.40%) is down -1.00%. Apr gold (GCJ15 -0.05%) is down -0.01%. May copper (HGK15 -1.80%) is down -1.87%. Agriculture prices are mostly lower. The dollar index (DXY00 -0.09%) is down -0.19%. EUR/USD (^EURUSD) is up +0.42%. USD/JPY (^USDJPY) is down -0.07%. Jun T-note prices (ZNM15 +0.34%) are up +11.5 ticks on reduced inflation expectations after the 10-year T-note break-even rate, a gauge of inflation expectations for the next decade, fell to a 6-week low.The German Mar ZEW survey expectations of economic growth rose +1.8 to 54.8, weaker than expectations of +6.4 to 59.4 but still the highest in 13 months. The Mar ZEW survey current situation rose +9.6 to 55.1, stronger than expectations of +6.5 to 52.0 and the highest in 8 months.
Eurozone Feb new car registrations rose +7.3% y/y to 924,000, the largest increase in 11 months.
Eurozone Feb CPI was left unrevised at -0.3% y/y, but Feb core CPI was revised upward to +0.7% y/y from the previously reported +0.6% y/y.
Eurozone Q4 employment rose +0.1% q/q and +0.9% y/y, with the +0.9% y/y gain the largest year-over-year increase since Q2 2008.
U.S. STOCK PREVIEW
Today’s Feb housing starts report is expected to show a decline of -2.4% to 1.040 million, adding to January’s -2.0% decline. The FOMC today will begin its 2-day meeting. There are 5 of the Russell 1000 companies that report earnings today with notable reports including: Oracle (consensus $0.68), Adobe (0.39), FactSet (1.36), DSW (0.28).Equity conferences during the remainder of this week include: Consumer Analyst Group of Europe Conference on Mon-Wed, Barclays Investor Conference on Tue, Cowen and Company Permian Basin Oilfield Tour on Tue, Goldman Sachs Innovation Symposium on Tue, Bank of America Merrill Lynch Global Industrials & EU Autos Conference on Tue-Thu, Barclays Atlanta Utilities Conference on Wed, Wells Fargo Asset Managers, Brokers & Exchanges Conference on Wed, ISI Retail Summit on Wed, Barclays Power and Utilities CFO Corporate Day on Wed, Alzheimer's and Parkinson's Diseases and Related Neurological Disorders (AD/PD) on Fri.
OVERNIGHT U.S. STOCK MOVERS
Burlington Stores (BURL -2.07%) reported Q4 adjusted EPS of $1.43, better than consensus $1.32, but then lowered guidance on fiscal 2015 adjusted EPS to $2.15-$2.25, below consensus of $2.26.PG&E (PCG +3.38%) was downgraded to 'Equal Weight' from 'Overweight' at Morgan Stanley.
Alibaba (BABA +2.61%) was upgraded to 'Buy' from 'Hold' at Stifel.
DSW (DSW -0.86%) reported Q4 adjusted EPS of 35 cents, higher than consensus of 28 cents.
ABM Industries (ABM +1.58%) was upgraded to 'Outperform' from 'Neutral' at RW Baird.
Credit Suisse (CS -0.08%) was downgraded to 'Underperform' from 'Neutral' at Macquarie.
Providence Service (PRSC -3.64%) reported Q4 EPS of 45 cents, well above consensus of 29 cents.
Ryerson (RYI -1.22%) reported Q4 EPS of 15 cents, below consensus of 20 cents.
American Airlines (AAL +2.03%) jumped 4% in after-hours trading after it was announced that it will replace Allergan (AGN +1.21%) in the S&P 500 as of the close of trading on March 20.
Luminus reported a 5.8% passive stake in Dynegy (DYN +1.34%) .
Amber Capital reported a 5.7% passive stake in Gran Tierra (GTE -4.17%) .
Heineken (HEINY +1.99%) was downgraded to 'Neutral' from 'Buy' at Goldman Sachs.
Twitter (TWTR -0.49%) was initiated with a 'Buy' at Brean Capital with a price target of $61.
Facebook (FB +0.03%) was initiated with a 'Buy' at Brean Capital with a price target of $96.
LinkedIn (LNKD +0.41%) was initiated with a 'Sell' at Brean Capital with a price target of $208.
CHC Group (HELI -12.12%) reported a Q3 adjusted EPS loss of -50 cents, a much bigger loss than consensus of -28 cents.
Valeant (VRX +2.49%) filed to sell $1.45 billion in common stock.
MARKET COMMENTS
Jun E-mini S&Ps (ESM15 -0.33%) this morning are down -6.50 points (-0.31%). The S&P 500 index on Monday closed sharply higher: S&P 500 +1.35%, Dow Jones +1.29%, Nasdaq +1.29%. Bullish factors included (1) carry-over support from a rally in China’s Shanghai stock index to a 5-1/2 year high after Premier Li Keqiang was quoted by the state-run Xinhua news agency as saying that policymakers have “fairly ample room” and a “host of policy instruments” to boost economic growth if it slows more than expected, (2) strength in healthcare stocks on increased M&A activity after Valeant Pharmaceuticals purchased Salix Pharmaceuticals for $11.1 billion, and (3) reduced interest rate hike concerns after Monday’s weak U.S. economic data.Jun 10-year T-notes (ZNM15 +0.34%) this morning are up +11.5 ticks. Jun 10-year T-note futures prices on Monday closed higher. Closes: TYM5 +3.50, FVM5 +2.50. Bullish factors included (1) weaker-than-expected U.S. economic data on Feb industrial production and Mar Empire manufacturing activity, which may nudge the Fed to delay interest rate increases, and (2) reduced inflation expectations after the 10-year T-note breakeven inflation rate fell to a 1-month low.
The dollar index (DXY00 -0.09%) this morning is down -0.193 (-0.19%). EUR/USD (^EURUSD) is up +0.0044 (+0.42%). USD/JPY (^USDJPY) is down -0.09 (-0.07%). The dollar index on Monday closed lower: Dollar index -0.726 (-0.72%), EUR/USD +0.0074 (+0.71%), USD/JPY -0.016 (-0.01%). Negative factors included (1) the unexpected declines in the Mar Empire manufacturing index and the Mar NAHB housing market index, which prompted long liquidation in the dollar and (2) the smaller-than-expected increase in U.S. Feb industrial production, which may prompt the Fed to delay an interest rate hike.
Apr WTI crude oil (CLJ15 -2.28%) this morning is down -75 cents (-1.71%) and Apr gasoline (RBJ15 -1.40%) is down -0.0172 (-1.00%). Apr crude oil and gasoline prices on Monday closed lower with Apr crude at a 6-year low and Apr gasoline at a 1-1/4 month low: CLJ5 -0.96 (-2.14), RBJ5 -0.0343 (-1.95%). Bearish factors included (1) negative carry-over from Friday’s IEA report saying that the record oil surplus in the U.S. may soon strain the nation’s storage capacity and further pressure oil prices, and (2) weaker-than-expected U.S. economic data on the Mar Empire manufacturing index and Feb industrial production, which signals reduced energy consumption and demand.
GLOBAL EVENT CALENDAR03/17/2015
| US | 0830 ET | Feb housing starts expected -2.4% to 1.040 million, Jan -2.0% m/m to 1.065 million. Feb building permits expected +0.5% to 1.065 million, Jan -0.7% m/m to 1.053 million. |
| 1030 ET | FOMC begins 2-day policy meeting. | |
| JPN | 0100 ET | Revised Japan Jan leading index CI, previous -0.2 to 105.1. Revised Jan coincident index, previous +2.4 to 113.0. |
| 1950 ET | Japan Feb trade balance expected -986.6 billion yen, Jan -1.179 trillion yen. Feb exports expected +0.3% y/y, Jan +17.0% y/y. Feb imports expected +3.2% y/y, Jan -9.0% y/y. | |
| n/a | BOJ announces interest rate decision following 2-day policy meeting. | |
| EUR | 0300 ET | Eurozone Feb new car registrations, Jan +5.7% y/y. |
| 0600 ET | Eurozone Q4 employment, Q3 +0.4% q/q and +0.6% y/y. | |
| 0600 ET | Revised Eurozone Feb CPI, previous -0.3% y/y and Feb core CPI +0.6% y/y | |
| GER | 0600 ET | German Mar ZEW survey expectations of economic growth expected +6.3 to 59.3, Feb 53.0. Mar ZEW survey current situation expected +6.5 to 52.0, Feb 45.5. |
| CHI | 2130 ET | China Feb property prices. |
U.S. STOCK CALENDAR03/17/2015
| Company | Ticker | Time | Event Description | Period | Estimate |
|---|---|---|---|---|---|
| Zebra Technologies Corp | ZBRA US | Bef-mkt | Q4 2014 Earnings Release | Q4 2014 | 1.148 |
| FactSet Research Systems Inc | FDS US | Bef-mkt | Q2 2015 Earnings Release | Q2 2015 | 1.359 |
| DSW Inc | DSW US | 7:00 | Q4 2015 Earnings Release | Q4 2015 | 0.276 |
| Zebra Technologies Corp | ZBRA US | 7:30 | Q4 2014 Earnings Call | Q4 2014 | |
| Vectrus Inc | VEC US | 8:00 | Q4 2014 Earnings Call | Q4 2014 | |
| DSW Inc | DSW US | 8:30 | Q4 2015 Earnings Call | Q4 2015 | |
| FactSet Research Systems Inc | FDS US | 11:00 | Q2 2015 Earnings Call | Q2 2015 | |
| Toro Co/The | TTC US | 14:30 | Annual General Meeting | Y 2015 | |
| NVIDIA Corp | NVDA US | 15:00 | Investor Day | Y 2015 | |
| Dow Chemical Co/The | DOW US | 17:00 | ITC Announce's Decision on Organik vs. Dow Chemical Trade Secret Case | ||
| Adobe Systems Inc | ADBE US | 17:00 | Q1 2015 Earnings Call | Q1 2015 | |
| Oracle Corp | ORCL US | 17:00 | Q3 2015 Earnings Call | Q3 2015 | |
| Adobe Systems Inc | ADBE US | Aft-mkt | Q1 2015 Earnings Release | Q1 2015 | 0.385 |
| Oracle Corp | ORCL US | Aft-mkt | Q3 2015 Earnings Release | Q3 2015 | 0.683 |
| JPMorgan Chase & Co | JPM US | Board Meeting - Authorization of Equity Repurchase Program | |||
| Vertex Pharmaceuticals Inc | VRTX US | PDUFA, Kalydeco, cystic fibrosis (CF) patients 2-5 years of age | |||
| Charter Communications Inc | CHTR US | Extraordinary Shareholders Meeting - M&A Vote | Y 2015 | ||
| ADT Corp/The | ADT US | Annual General Meeting | Y 2015 |
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