Tuesday, December 15th, 2015View Older Reports
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OVERNIGHT MARKETS AND NEWS
March E-mini S&Ps (ESH16 +0.81%) are up +0.83% and European stocks are up +2.37% as a rally in crude oil gives energy producers a lift. Also, European automakers moved higher after Eurozone Nov new car registrations rose more than expected at the fastest pace in 5 months. Mining stocks gained as well, led by a nearly 5% increase in Glencore Plc, after JPMorgan Chase upgraded the stock to a 'Buy,' citing its "credible" strategy update. Asian stocks settled mixed: Japan -1.68%, Hong Kong -0.17%, China -0.29%, Taiwan +0.41%, Australia -0.39%, Singapore +0.02%, South Korea +0.26%, India +0.68%. Japan's Nikkei Stock Index fell to a 1-3/4 month low as exporter stocks declined after USD/JPY slipped to a 6-week low, which reduces exporters' earnings prospects.
The dollar index (DXY00 -0.02%) is down -0.07% at a 5-week low on speculation the Fed will reiterate that it sees a gradual pace of interest rate increases even after it raises interest rates tomorrow. EUR/USD (^EURUSD) is up +0.14% at a 1-1/2 month high. USD/JPY (^USDJPY) is up +0.10%.
Eurozone Nov new car registrations rose +13.7% y/y to 1.085 million units, the biggest increase in 5 months.
The German Dec ZEW survey expectations of economic growth rose +5.7 to 16.1, stronger than expectations of +4.6 to 15.0.
U.S. STOCK PREVIEW
Key U.S. news today includes: Dec Empire manufacturing survey of general business conditions (expected +3.74 to -7.00, Nov +0.62 to -10.74), (2) Nov CPI (expected unch m/m and +0.5% y/y, Oct +0.2% m/m and +0.2% y/y) and core CPI (expected +0.2% m/m and+2.0% y/y, Oct +0.2% m/m and +1.9% y/y), (3) the first day of the 2-day FOMC meeting where the market is discounting a three-quarters chance of a 25 bp rate hike, and (4) Dec NAHB housing market index (expected +1 to 63, Nov -3 to 62).
There is 1 of the Russell 1000 companies that report earnings today: FactSet Research Systems (1.46).
U.S. IPO's scheduled to price today: none.
Equity conferences: European Society for Medical Oncology Asia Congress on Fri.
OVERNIGHT U.S. STOCK MOVERS
Amgen (AMGN +1.91%) rose nearly 2% in pre-market trading after it said it reacquired all product rights to Prolia, Xgeva and Vectibix from Glaxo in 48 countries.
Lumber Liquidators (LL +1.22%) surged over 15% in after-hours trading when short seller Whitney Tilson said he covered his short position in the company after he said he received new information that shows management wasn't aware it was selling Chinese-made laminate with high levels of formaldehyde.
Amazon.com (AMZN +2.77%) was rated a new 'Buy' at MKM Partners with a price target of $800.
Verizon Communications (VZ +1.41%) was downgraded to 'Neutral' from 'Buy' at BTIG.
Occidental Petroleum (OXY +0.94%) was rated a new 'Buy' at CLSA with a price target of $83.
Chevron (CVX +3.34%) was rated a new 'Outperform' at CLSA with a price target of $95 and ConocoPhillips (COP +2.91%) was also rated a new 'Outperform' at CLSA with a price target of $52.
VeriFone Systems (PAY unch) climbed nearly 2% in after-hours trading after it raised guidance on fiscal 2016 adjusted EPS to $2.15-$2.17, higher than consensus of $2.12.
Xerox (XRX -1.79%) rose over 1% in after-hours trading after Carl Icahn reported he raised his stake in the company to 8.1% from 7.1%.
Lockheed Martin (LMT -0.29%) was awarded a $1.09 billion U.S. Army pact modification to foreign military sales for Patriot PAC-3 production.
Boeing (BA -1.12%) raised its quarterly dividend to $1.09 a share from 91 cents, higher than expectations of a hike to $1.02, and then raised its stock buyback authorization to $14 billion from $12 billion.
Kennametal (KMT -0.12%) slumped over 20% in after-hours trading after it said it expects its fiscal 2016 revenue may fall as much as 30% to 60% due to weakness in China's auto market and in U.S. coal mining.
MARKET COMMENTS
Mar E-mini S&Ps (ESH16 +0.81%) this morning are up +16.75 points (+0.83%). Monday's closes: S&P 500 +0.48%, Dow Jones +0.60%, Nasdaq +0.72%. The S&P 500 on Monday recovered from a 2-month low and closed higher. Stocks received a boost from reduced Chinese economic concerns after China Nov industrial production rose +6.2% y/y, stronger than expectations of +5.7% y/y and the fastest pace of increase in 5 months. In addition, energy producers saw some strength after crude oil prices rebounded from a 6-3/4 year low and closed higher.
Mar 10-year T-notes (ZNH16 -0.10%) this morning are down -7 ticks. Monday's closes: TYH6 -23.50, FVH6 -13.50. Mar T-notes on Monday closed lower on long liquidation on expectations for the FOMC to raise the federal funds rate by 25 bp on Wednesday and on carryover weakness from a slide in German bund prices after ECB President Draghi said he expects inflation to return to target "without delay."
The dollar index (DXY00 -0.02%) this morning is down -0.067 (-0.07%) at a 5-week low. EUR/USD (^EURUSD) is up +0.0015 (+0.14%) at a 1-1/2 month high. USD/JPY (^USDJPY) is up +0.12 (+0.10%). Monday's closes: Dollar Index +0.039 (+0.04%), EUR/USD +0.0006 (+0.05%), USD/JPY +0.02 (+0.02%). The dollar index on Monday closed slightly higher on expectations for the Fed to raise interest rates at the conclusion of Wednesday's FOMC meeting and on the rally in stocks, which caused USD/JPY to recover from a 5-week low and close higher on reduced safe-haven demand or the yen. The dollar was undercut as EUR/USD which rose to 5-week high after Eurozone Oct industrial production rose more than expected and after ECB President Draghi said he expects inflation to return to target "without delay."
Jan crude oil (CLF16 +0.77%) this morning is up +47 cents (+1.29%) and Jan gasoline (RBF16 -1.50%) is down -0.0199 (-1.58%). Monday's closes: CLF6 +0.65 (+1.82%), RBF6 -0.0386 (-3.01%). Jan crude oil and gasoline on Monday settled mixed as Jan crude recovered from a 6-3/4 year low. Crude oil prices received a boost from short-covering on news that China Nov industrial production and retail sales rose more than expected, and optimism that Congress may lift the 40-year old U.S. crude export ban. Crude prices earlier slumped to a fresh 6-3/4 year low after Iran's deputy oil minister said that there's "absolutely no chance" Iran will delay its plan to increase crude exports even as prices decline.
China Nov industrial production rose +6.2% y/y, stronger than expectations of +5.7% y/y and the fastest pace of increase in 5 months. In addition, energy producers saw some strength after crude oil prices rebounded from a 6-3/4 year low and closed higher.
Mar 10-year T-notes (ZNH16 -0.10%) this morning are down -7 ticks. Monday's closes: TYH6 -23.50, FVH6 -13.50. Mar T-notes on Monday closed lower on long liquidation on expectations for the FOMC to raise the federal funds rate by 25 bp on Wednesday and on carryover weakness from a slide in German bund prices after ECB President Draghi said he expects inflation to return to target "without delay."
The dollar index (DXY00 -0.02%) this morning is down -0.067 (-0.07%) at a 5-week low. EUR/USD (^EURUSD) is up +0.0015 (+0.14%) at a 1-1/2 month high. USD/JPY (^USDJPY) is up +0.12 (+0.10%). Monday's closes: Dollar Index +0.039 (+0.04%), EUR/USD +0.0006 (+0.05%), USD/JPY +0.02 (+0.02%). The dollar index on Monday closed slightly higher on expectations for the Fed to raise interest rates at the conclusion of Wednesday's FOMC meeting and on the rally in stocks, which caused USD/JPY to recover from a 5-week low and close higher on reduced safe-haven demand or the yen. The dollar was undercut as EUR/USD which rose to 5-week high after Eurozone Oct industrial production rose more than expected and after ECB President Draghi said he expects inflation to return to target "without delay."
Jan crude oil (CLF16 +0.77%) this morning is up +47 cents (+1.29%) and Jan gasoline (RBF16 -1.50%) is down -0.0199 (-1.58%). Monday's closes: CLF6 +0.65 (+1.82%), RBF6 -0.0386 (-3.01%). Jan crude oil and gasoline on Monday settled mixed as Jan crude recovered from a 6-3/4 year low. Crude oil prices received a boost from short-covering on news that China Nov industrial production and retail sales rose more than expected, and optimism that Congress may lift the 40-year old U.S. crude export ban. Crude prices earlier slumped to a fresh 6-3/4 year low after Iran's deputy oil minister said that there's "absolutely no chance" Iran will delay its plan to increase crude exports even as prices decline.
GLOBAL EVENT CALENDAR12/15/2015
| US | 0830 ET | Dec Empire manufacturing survey of general business conditions expected +3.74 to -7.00, Nov +0.62 to -10.74. |
| 0830 ET | Nov CPI expected unch m/m and +0.5% y/y, Oct +0.2% m/m and +0.2% y/y. Nov CPI ex food & energy expected +0.2% m/m and+2.0% y/y, Oct +0.2% m/m and +1.9% y/y. | |
| 0930 ET | FOMC begins 2-day policy meeting. | |
| 1000 ET | Dec NAHB housing market index expected +1 to 63, Nov -3 to 62. | |
| EUR | 0200 ET | Eurozone Nov new car registrations, Oct +2.9% y/y. |
| 0500 ET | Eurozone Q3 employment, Q2 +0.3% q/q and +0.8% y/y. | |
| UK | 0430 ET | UK Nov CPI expected -0.1% m/m and +0.1% y/y, Oct +0.1% m/m and -0.1% y/y. Nov core CPI expected +1.2% y/y, Oct +1.1% y/y. |
| 0430 ET | UK Nov RPI expected unch m/m and +0.9% y/y, Oct unch m/m and +0.7% y/y. Nov RPI ex mortgage interest payments expected +1.0% y/y, Oct +0.8% y/y. | |
| 0430 ET | UK Nov PPI input prices expected -1.0% m/m and -12.4% y/y, Oct +0.2% m/m and -12.1% y/y. | |
| 0430 ET | UK Nov PPI output prices expected -0.1% m/m and -1.3% y/y, Oct unch m/m and -1.3% y/y. Nov PPI output core expected unch m/m and +0.1% y/y, Oct -0.1% m/m and +0.3% y/y. | |
| 0430 ET | UK Oct ONS house prices, Sep +6.1% y/y. | |
| GER | 0500 ET | German Dec ZEW expectations of economic growth survey expected +4.6 to 15.0, Nov 10.4. Dec ZEW survey current situation expected-0.2 to 54.2, Nov 54.4. |
U.S. STOCK CALENDAR12/15/2015
| Company | Ticker | Time | Event Description | Period | Estimate |
|---|---|---|---|---|---|
| FactSet Research Systems Inc | FDS US | 7:00 | Q1 2016 Earnings Release | Q1 2016 | 1.463 |
| AGCO Corp | AGCO US | 8:30 | Analyst Meeting | Y 2015 | |
| Kennametal Inc | KMT US | 9:00 | Analyst Day | Y 2015 | |
| 3M Co | MMM US | 9:00 | Q4 2016 Guidance Call | Q4 2016 | |
| AECOM | ACM US | 9:00 | Investor Day | Y 2015 | |
| American Water Works Co Inc | AWK US | 9:00 | Analyst Day | Y 2015 | |
| Liberty Property Trust | LPT US | 10:00 | Q4 2016 Guidance Call | Q4 2016 | |
| AmTrust Financial Services Inc | AFSI US | 10:00 | Extraordinary Shareholders Meeting | ||
| FactSet Research Systems Inc | FDS US | 11:00 | Q1 2016 Earnings Call | Q1 2016 | |
| WESCO International Inc | WCC US | 11:00 | Q4 2016 Guidance Call | Q4 2016 | |
| SolarCity Corp | SCTY US | 12:30 | Analyst Day | Y 2015 | |
| FactSet Research Systems Inc | FDS US | 15:00 | Annual General Meeting | Y 2015 | |
| Dover Corp | DOV US | 18:30 | Investor Meeting | Y 2015 | |
| American Express Co | AXP US | Credit-card Charge-offs and Delinquencies | |||
| Baker Hughes Inc | BHI US | U.S. Justice Department Deadline on Decision of Halliburton's Takeover of Baker | |||
| JPMorgan Chase & Co | JPM US | Credit-card Charge-offs and Delinquencies | |||
| Equifax Inc | EFX US | Investor Meeting - Baltimore | Y 2015 | ||
| Halliburton Co | HAL US | U.S. Justice Department Deadline on Decision of Halliburton's Takeover of Baker | |||
| Bank of America Corp | BAC US | Credit-card Charge-offs and Delinquencies | |||
| Citigroup Inc | C US | Credit-card Charge-offs and Delinquencies | |||
| Questar Corp | STR US | Roadshow - Los Angeles | Y 2015 | ||
| Morgan Stanley | MS US | Credit-card Charge-offs and Delinquencies | |||
| Capital One Financial Corp | COF US | Credit-card Charge-offs and Delinquencies | |||
| AmTrust Financial Services Inc | AFSI US | Special Meeting | |||
| 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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