Monday, November 16th, 2015View Older Reports
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OVERNIGHT MARKETS AND NEWS
Dec E-mini S&Ps (ESZ15 +0.20%) this morning are up 4.50 points (+0.22%) and the EuroStoxx 50 index is up +0.34% as the world stock markets are showing resiliency despite last Friday's terrorist attack in Paris. The terrorist attack is a bearish factor for global stocks with expectations for expanded Western military action in the Middle East and a dent to French economic growth. However, the market fall-out has been contained since there were no additional attacks and no indications as yet of similar imminent threats in other Western nations. Indeed, energy and commodity producer stocks rallied today along with energy and commodity prices, overcoming weakness in travel and leisure companies.
Chinese mainland stocks initially fell today after the Chinese mainland exchanges after Friday's close announced a doubling of stock margins to reduce stock investor leverage. The Shanghai Composite index was down -1.7% early in today's session but was able to rally and end the day up +0.7% on speculation that the Chinese government was in the market buying stocks. The Hong Kong Hang Seng index, however, did not fare as well and closed the day down -1.72%.
Asian stocks today closed mostly lower: Japan -1.04%, Hong Kong -1.72%, China Shanghai Composite +0.73%, Taiwan -0.41%, Australia -0.94%, Singapore -0.34%, South Korea -1.58%, India +0.58%, Turkey -0.82%.
The dollar index (DXY00 +0.08%) this morning is slightly higher by +0.054 points (+0.05%) while USD/JPY (^USDJPY) is up +0.46 (+0.38%) on some safe-haven demand. EUR/USD (^EURUSD) is down -0.0034 (-0.32%) as the terrorist attack in Paris will put a dent in French economic growth and could increase the likelihood of additional ECB stimulus at its December meeting. Dec 10-year T-note futures (ZNZ15 +0.14%) this morning are up +5 ticks on some increased safe-haven demand.
The Chinese yuan rallied by +0.1% today after news that the IMF staff recommended that the yuan be included in the IMF's basket of reserve currencies, which will likely lead to increased demand for the yuan in coming years. The IMF executive board will meet on Nov 30 to make a final decision on whether to add the yuan to the currency basket.
Commodity prices this morning are up +0.49% due to strength in energy and metals prices. Dec crude oil (CLZ15 +2.28%) this morning is up +0.75 (+1.84%) and Dec gasoline (RBZ15 +1.14%) is up +0.0114 (+0.92%) on expectations for increased turmoil in the Middle East after Friday's terrorist attacks in Paris. Dec gold (GCZ15 +0.96%) is up +9.6 (+0.89%) and Dec silver (SIZ15 +1.27%) is up +0.166 (+1.17%) on increased safe-haven demand with Friday's terrorist attack in Paris, but Dec copper (HGZ15 -0.85%) is down -0.024 (-1.11%). Grains are steady to lower with Dec corn unchanged, Jan soybeans down -1.00 (-0.12%), and Dec wheat down -3.50 (-0.71%). Softs this morning are mixed: March sugar -0.06 (-0.40%), Dec coffee +0.65 (+0.58%), Dec cocoa +21 (+0.63%), and Dec cotton unchanged.
Credit-rating firm DBRS Ltd kept Portugal's credit rating at investment grade, thus maintaining the eligibility for Portugal to remain in the ECB's QE bond-buying program. Portuguese 10-year bond yields today fell by 7 bp to 2.69%.
Today is the second day of the 2-day G-20 summit in Turkey where the initial focus was on Friday's terrorist attack in Paris and efforts to stabilize Syria.
U.S. STOCK PREVIEW
Key U.S. news today includes: (1) Nov Empire manufacturing survey of general business conditions (expected +5.01 to -6.35, Oct +3.31 to -11.36).
There are 4 of the Russell 1000 companies that report earnings today: Agilent Technologies (consensus $0.47), Dillard's (1.20), Urban Outfitters (0.42), Nuance Communications (0.35).
U.S. IPO's scheduled to price today: none.
Equity conferences this week include: Gabelli & Company Television & Broadcasting Symposium on Mon, UBS Global Technology Conference on Mon-Tue, J.P. Morgans Global Technology, Media and Telecom Conference on Tue, Mitsubishi UFJ Securities: Industry Conference - Oil & Gas Conference - New York on Tue, Bank of America Merrill Lynch Banking and Financial Services Conference on Tue-Wed, Morgan Stanley Global Consumer & Retail Conference on Tue-Wed, Stifel Health Care Conference on Tue-Wed, Bank of America Merrill Lynch Frontier Markets Conference on Wed, Barclays Global Automotive Conference on Wed, Vertical Research Partners Global Materials Conference on Wed, Canaccord Genuity Medical Technology and Diagnostics Forum on Thu, Jefferies Global Health Care Conference on Thu, Scotiabank Canadian Energy Infrastructure Conference on Thu, UBS Industrials and Transportation Conference on Thu-Fri.
Dec E-mini S&Ps this morning are up 4.50 points (+0.22%) as the world stock markets are showing resiliency despite last Friday's terrorist attack in Paris with the EuroStoxx 50 index this morning up +0.34%. Friday's closes: S&P 500 -1.12%, Dow Jones -1.16%, Nasdaq -1.54%. The S&P 500 on Friday extended the sharp 1-week sell-off to post a new 3-week low and close sharply lower as the downside correction continues from the sharp October rally. U.S. stocks on Friday saw downward pressure from the weak Oct U.S. retail sales report of +0.1% and +0.2% ex-autos, which kept U.S. consumer spending in a weak light, and from continued weakness in energy and mining companies with crude oil and copper closing lower once again.
OVERNIGHT U.S. STOCK MOVERS
- Marriott International (MAR -2.39%) announced a tender offer to buy Starwood Hotels & Resorts (HOT) for $12.2 billion, which would create the world's largest hotel company.
- Intercontinental Exchange (ICE -0.62%) is buying BC's Trayport for $650 million in stock.
- Ross Stores (ROST -6.86%) was added to its Conviction List by Goldman Sachs.
- Exxon (XOM -1.65%) reported a "temporary issue" at its California Torrance refinery
- SunEdison (SUNE +8.59%) fell -0.2% in after-hours on Friday after news that Third Point exited its 3.9% stake. Third Point also exited its stake in Phillips 66 (PSX -0.18%).
- Apple's (AAPL -2.92%) CEO Cook said he sees "huge" 2015 Apple Watch sales.
- Emerson Electric (EMR +0.93%) may rally 25% in the next few years due to planned divestitures to boost profitability, according to a weekend article in Barron's.
- Genessee & Wyoming (GWR +0.38%) could rise more than 20% if the company makes acquisitions, according to Barrron's.
MARKET COMMENTS
Dec 10-year T-note futures this morning are up +5 ticks on some increased safe-haven demand. Friday's closes: TYZ5 +10.50, FVZ5 +7.5. Dec 10-year T-notes on Friday closed higher on the weak U.S. Oct retail sales report and on increased safe-haven demand with the fairly sharp sell-off seen in most global stock markets on Friday.
The dollar index this morning is slightly higher by +0.054 points (+0.05%) while USD/JPY is up +0.46 (+0.38%) on some safe-haven demand. EUR/USD is down -0.0034 (-0.32%) as the terrorist attack in Paris will put a dent in French economic growth and could increase the likelihood of additional ECB stimulus at its December meeting. Friday's closes: Dollar Index +0.349 (+0.35%), EUR/USD -0.0041 (-0.38%), USD/JPY unchanged. The dollar index on Friday closed lower on fairly strong market expectations that the Fed will go ahead with a rate hike at its next meeting on Dec 15-16 after fairly hawkish comments by various Fed officials during the week.
GLOBAL EVENT CALENDAR11/16/2015
| US | 0830 ET | Nov Empire manufacturing survey of general business conditions expected +5.01 to -6.35, Oct +3.31 to -11.36. |
| 1100 ET | USDA weekly grain export inspections. | |
| 1600 ET | USDA weekly crop progress. | |
| EUR | 0500 ET | Revised Eurozone Oct CPI, prelim -0.1% y/y. Revised Oct core CPI, prelim +1.0% y/y. |
U.S. STOCK CALENDAR11/16/2015
| Company | Ticker | Time | Event Description | Period | Estimate |
|---|---|---|---|---|---|
| Dillard's Inc | DDS US | Bef-mkt | Q3 2016 Earnings Release | Q3 2016 | 1.198 |
| Hasbro Inc | HAS US | 10:00 | Investor Day | Y 2015 | |
| Agilent Technologies Inc | A US | 16:00 | Q4 2015 Earnings Release | Q4 2015 | 0.473 |
| Urban Outfitters Inc | URBN US | 16:30 | Q3 2016 Earnings Release | Q3 2016 | 0.419 |
| Agilent Technologies Inc | A US | 16:30 | Q4 2015 Earnings Call | Q4 2015 | |
| Urban Outfitters Inc | URBN US | 17:00 | Q3 2016 Earnings Call | Q3 2016 | |
| Nuance Communications Inc | NUAN US | 17:00 | Q4 2015 Earnings Call | Q4 2015 | |
| Nuance Communications Inc | NUAN US | Aft-mkt | Q4 2015 Earnings Release | Q4 2015 | 0.354 |
| American Express Co | AXP US | Credit-card Charge-offs and Delinquencies | |||
| JPMorgan Chase & Co | JPM US | Credit-card Charge-offs and Delinquencies | |||
| Bank of America Corp | BAC US | Credit-card Charge-offs and Delinquencies | |||
| Citigroup Inc | C US | Credit-card Charge-offs and Delinquencies | |||
| Morgan Stanley | MS US | Credit-card Charge-offs and Delinquencies | |||
| Capital One Financial Corp | COF US | Credit-card Charge-offs and Delinquencies | |||
| Reynolds American Inc | RAI US | Investor Day - New York | Y 2015 | ||
| Discover Financial Services | DFS US | Credit-card Charge-offs and Delinquencies | |||
| Synchrony Financial | SYF US | Credit-card Charge-offs and Delinquencies |
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