Wednesday, January 27, 2016

MORNING CALL 1/27

MORNING CALL
OVERNIGHT MARKETS AND NEWS
March E-mini S&Ps (ESH16 -0.51%) are down -0.67% and European stocks are down -1.04% as technology stocks slide, led by a 3% decline in Apple in pre-market trading, after it reported fewer-than-expected iPhones sold in Q1 and forecast a smaller-than-expected increase in Q2 revenue. The fall in China's Shanghai Composite to a 13-3/4 month low is also negative for stocks as is the -3.59% decline in crude oil prices that is undercutting energy producing stocks. The markets will be on edge ahead of the post-FOMC meeting statement later this afternoon. Asian stocks settled mixed: Japan +2.72%, Hong Kong +1.02%, China -0.52%, Taiwan +0.27%, Australia -1.20%, Singapore +0.02%, South Korea +1.66%, India +0.03%. China's Shanghai Composite fell to a 13-3/4 month low on economic concerns after China December industrial profits fell for a seventh month, although Japan's Nikkei Stock Index rallied up to a 1-week high and closed higher as carmakers rallied after the Nikkei newspaper reported that Toyota Motor may align with Suzuki Motor to better compete in emerging markets. Another positive sign for Japanese stocks was exchange data that showed short sales made up 43% of trading on the Tokyo Stock Exchange as of Tuesday's close, the highest this year. The last time short sales were this high was Sep 29, which marked the bottom of the market for several months.
The dollar index (DXY00 -0.37%) is down -0.35%. EUR/USD (^EURUSD) is up +0.05%. USD/JPY (^USDJPY) is down -0.12%.
Mar T-note prices (ZNH16 -0.07%) are down -2 ticks.
German Feb GfK consumer confidence was unch at 9.4, stronger than expectations of -0.1 to 9.3.
China Dec industrial profits fell -4.7% y/y, the seventh consecutive month that profits have declined.
U.S. STOCK PREVIEW
Key U.S. news today includes: (1) the outcome of the 2-day FOMC meeting that concludes today, (2) weekly MBA mortgage applications (previous +9.0% with purchase sub-index -1.6% and refi sub-index +18.7%), (3) Dec new home sales (expected +2.0% to 500,000, Nov +4.3% to 490,000), and (4) the Treasury's auction of $15 billion of 2-year floating-rate notes and $35 billion of 5-year T-notes.
There are 33 of the S&P 500 companies that report earnings today with notable reports including: Facebook (consensus $0.78), Boeing (1.37), PayPal (0.35), Discover Financial (1.30), E-Bay (0.50).
U.S. IPO's scheduled to price today: none.
Equity conferences during the remainder of this week: Cleantech Forum San Francisco on Tue-Wed, Real Estate Capital Markets 2016 Seminar on Wed.






OVERNIGHT U.S. STOCK MOVERS
Apple (AAPL +0.55%) dropped over 3% in pre-market trading after it reported shipments of 74.8 million iPhone units in Q1, short of projections of 75.5 million, and forecast Q2 revenue of $50 billion-$53 billion, below consensus of $55.5 billion.
AT&T (T +1.14%) slid nearly 2% in after-hours trading after it reported Q4 adjusted EPS of 63 cents, right on expectations, although Q4 revenue of $42.1 billion was below expectations of $42.7 billion, and new monthly subscribers rose 526,000, less than estimates of 555,000.
Stryker (SYK +1.71%) was upgraded to 'Buy' from 'Hold' at Brean Capital with a 12-month price target of $115.
Anthem (ANTM -0.66%) reported Q4 EPS of $1.14, below consensus of $1.18.
CA Technologies (CA +2.29%) climbed over 4% in after-hours trading after it reported Q3 adjusted EPS of 63 cents, higher than consensus of 58 cents.
U.S. Steel (X +12.28%) dropped over 9% in after-hours trading after it said it sees 2016 Ebitda near break-even, weaker than consensus of +$353.5 million.
Hawaiian Holdings (HA +2.31%) gained 5% in after-hours trading after it reported Q4 adjusted EPS of 85 cents, better than consensus of 84 cents, and said it sees Q1 capacity up 2.5% to 4.5%.
Ethan Allen (ETH +2.66%) climbed nearly 5% in after-hours trading after it reported Q2 adjusted EPS of 55 cents, better than consensus of 44 cents.
Capital One Financial (COF +2.93%) rose 1% in after-hours trading after it reported Q4 adjusted EPS of $1.67, higher than consensus of $1.61.
Raptor Pharmaceutical (RPTP +3.66%) surged over 15% in after-hours trading after Citigroup upgraded it to 'Buy' from 'Neutral.'
Total System Services (TSS +1.70%) slid over 4% in after-hours trading after it reported Q4 adjusted EPS continuing operations of 57 cents, below consensus of 60 cents.
Lannett (LCI +1.22%) tumbled over 10% in after-hours trading after it forecast Q2 adjusted EPS of 93 cents-95 cents, below consensus of 98 cents, and then lowered adjusted gross margins of fiscal 2016 sales to 61%-63% of net sales, below an earlier forecat of 71%-73%.
Fate Therapeutics (FATE +0.81%) soared 17% in after-hours trading after it announced FDA clearance of Investigational New Drug Application for its ProTmune for prevention of acute GvHD and CMV infection.
MARKET COMMENTS
Mar E-mini S&Ps (ESH16 -0.51%) this morning are down -12.75 points (-0.67%). Tuesday's closes: S&P 500 +1.41%, Dow Jones +1.78%, Nasdaq +0.89%. The S&P 500 index on Tuesday closed higher on strength in crude oil prices that boosted energy producing stocks and on the unexpected +1.8 point increase in U.S. Jan consumer confidence to 98.1 (stronger than expectations of unch at 96.5). Stocks were undercut by the -6.42% plunge in the Shanghai Composite to a 13-1/2 month low.
Mar 10-year T-notes (ZNH16 -0.07%) this morning are down -2 ticks. Tuesday's closes: TYH6 +8.50, FVH6 +4.75. Mar T-notes on Tuesday closed higher on the -6.42% plunge in the Shanghai Composite Index to a 13-1/2 month low, which may delay a Fed rate hike, and on carryover support from a rally in German bunds to a 4-3/4 month high. T-note prices were undercut by a rally in stocks that curbed the safe-haven demand for T-notes.
The dollar index (DXY00 -0.37%) this morning is down -0.347 (-0.35%). EUR/USD (^EURUSD) is up +0.0005 (+0.05%). USD/JPY (^USDJPY) is down-0.14 (-0.12%). Tuesday's closes: Dollar Index unch, EUR/USD +0.0021 (+0.19%), USD/JPY +0.12 (+0.10%). The dollar index on Tuesday closed little changed. The dollar was undercut by the rally in crude oil that boosted the Canadian dollar to a 3-week high against the dollar, and by long liquidation in the dollar ahead of the results of the Wed/Thu FOMC meeting that could result in a more dovish tone. The dollar found some support on the stronger-than-expected Jan U.S. consumer confidence report.
Mar crude oil (CLH16 -2.89%) this morning is down -$1.13 a barrel (-3.59%) and Mar gasoline (RBH16 -2.83%) is down -0.0388 (-3.63%). Tuesday's closes: CLH6 +0.17 (+0.56%), RBH6 -0.0090 (-0.86%). Mar crude oil and gasoline on Tuesday settled mixed. Crude oil was boosted by Iraqi Oil Minister Adel Abdul Hahdi's comment that Saudi Arabia and Russia are now more flexible about cooperating to cut crude oil output. Crude oil prices were undercut by the plunge in China's Shanghai Composite to 13-1/2 month low, a sign of economic weakness, and by expectations for Wednesday’s EIA inventory report to show U.S. crude supplies rose +4.0 million bbl.
GLOBAL EVENT CALENDAR01/27/2016
US0700 ETWeekly MBA mortgage applications, previous +9.0% with purchase sub-index -1.6% and refi sub-index +18.7%.
1000 ETDec new home sales expected +2.0% to 500,000, Nov +4.3% to 490,000.
1030 ETEIA Weekly Petroleum Status Report.
1130 ETTreasury auctions $15 billion 2-year floating-rate notes.
1300 ETTreasury auctions $35 billion 5-year T-notes.
1400 ETFOMC announces interest rate decision.
GER0200 ETGerman Feb GfK consumer confidence expected -0.1 to 9.3, Jan 9.4.
UK0200 ETUK Jan nationwide house prices expected +0.6% m/m and +4.7% y/y, Dec +0.8% m/m and +4.5% y/y.
JPN1850 ETJapan Dec retail sales expected +1.0% m/m and +0.2% y/y, Nov -2.5% m/m and -1.1% y/y.
U.S. STOCK CALENDAR01/27/2016

CompanyTickerTimeEvent DescriptionPeriodEstimate
Hess CorpHES USBef-mktQ4 2015 Earnings ReleaseQ4 2015-1.458
Boeing Co/TheBA USBef-mktQ4 2015 Earnings ReleaseQ4 20151.267
General Dynamics CorpGD USBef-mktQ4 2015 Earnings ReleaseQ4 20152.376
Progressive Corp/ThePGR USBef-mktQ4 2015 Earnings ReleaseQ4 20150.463
Progressive Corp/ThePGR USBef-mktQ4 2015 Earnings Release - December SalesQ4 20150.463
Textron IncTXT USBef-mktQ4 2015 Earnings ReleaseQ4 20150.828
United Technologies CorpUTX USBef-mktQ4 2015 Earnings ReleaseQ4 20151.521
Biogen IncBIIB USBef-mktQ4 2015 Earnings ReleaseQ4 20154.072
State Street CorpSTT USBef-mktQ4 2015 Earnings ReleaseQ4 20151.185
Rockwell Automation IncROK USBef-mktQ1 2016 Earnings ReleaseQ1 20161.328
Anthem IncANTM US6:00Q4 2015 Earnings ReleaseQ4 20151.177
EMC Corp/MAEMC US7:00Q4 2015 Earnings ReleaseQ4 20150.648
St Jude Medical IncSTJ US7:15Q4 2015 Earnings ReleaseQ4 20151.011
Illinois Tool Works IncITW US8:00Q4 2015 Earnings ReleaseQ4 20151.205
Norfolk Southern CorpNSC US8:00Q4 2015 Earnings ReleaseQ4 20151.241
Textron IncTXT US8:00Q4 2015 Earnings CallQ4 2015
St Jude Medical IncSTJ US8:00Q4 2015 Earnings CallQ4 2015
Navient CorpNAVI US8:00Q4 2015 Earnings CallQ4 2015
EMC Corp/MAEMC US8:30Q4 2015 Earnings CallQ4 2015
United Technologies CorpUTX US8:30Q4 2015 Earnings CallQ4 2015
Biogen IncBIIB US8:30Q4 2015 Earnings CallQ4 2015
Chubb LtdCB US8:30Q4 2015 Earnings CallQ4 2015
Rockwell Automation IncROK US8:30Q1 2016 Earnings CallQ1 2016
Anthem IncANTM US8:30Q4 2015 Earnings CallQ4 2015
Norfolk Southern CorpNSC US8:45Q4 2015 Earnings CallQ4 2015
CMS Energy CorpCMS US9:00Business Update Call
Walgreens Boots Alliance IncWBA US9:00Annual General MeetingY 2016
Kinder Morgan Inc/DEKMI US9:00Analyst DayY 2016
State Street CorpSTT US9:30Q4 2015 Earnings CallQ4 2015
Hess CorpHES US10:00Q4 2015 Earnings CallQ4 2015
Illinois Tool Works IncITW US10:00Q4 2015 Earnings CallQ4 2015
Boeing Co/TheBA US10:30Q4 2015 Earnings CallQ4 2015
General Dynamics CorpGD US11:30Q4 2015 Earnings CallQ4 2015
Johnson Controls IncJCI US15:00Annual General Meeting
McKesson CorpMCK US16:00Q3 2016 Earnings ReleaseQ3 20163.139
Facebook IncFB US16:00Run TLIV for Top Live Blog
Citrix Systems IncCTXS US16:05Q4 2015 Earnings ReleaseQ4 20151.192
Texas Instruments IncTXN US16:30Q4 2015 Earnings ReleaseQ4 20150.694
eBay IncEBAY US16:30Q4 2015 Earnings CallQ4 2015
QUALCOMM IncQCOM US16:45Q1 2016 Earnings CallQ1 2016
Citrix Systems IncCTXS US16:45Q4 2015 Earnings CallQ4 2015
Varian Medical Systems IncVAR US17:00Q1 2016 Earnings CallQ1 2016
Lam Research CorpLRCX US17:00Q2 2016 Earnings CallC4 2016
Vertex Pharmaceuticals IncVRTX US17:00Q4 2015 Earnings CallQ4 2015
Tractor Supply CoTSCO US17:00Q4 2015 Earnings CallQ4 2015
McKesson CorpMCK US17:00Q3 2016 Earnings CallQ3 2016
Juniper Networks IncJNPR US17:00Q4 2015 Earnings CallQ4 2015
Facebook IncFB US17:00Q4 2015 Earnings CallQ4 2015
Discover Financial ServicesDFS US17:00Q4 2015 Earnings CallQ4 2015
PayPal Holdings IncPYPL US17:00Q4 2015 Earnings CallQ4 2015
Murphy Oil CorpMUR USAft-mktQ4 2015 Earnings ReleaseQ4 2015-1.279
Varian Medical Systems IncVAR USAft-mktQ1 2016 Earnings ReleaseQ1 20160.923
Lam Research CorpLRCX USAft-mktQ2 2016 Earnings ReleaseQ2 20161.423
QUALCOMM IncQCOM USAft-mktQ1 2016 Earnings ReleaseQ1 20160.909
Vertex Pharmaceuticals IncVRTX USAft-mktQ4 2015 Earnings ReleaseQ4 20150.143
Tractor Supply CoTSCO USAft-mktQ4 2015 Earnings ReleaseQ4 20150.817
SanDisk CorpSNDK USAft-mktQ4 2015 Earnings ReleaseQ4 20150.897
SL Green Realty CorpSLG USAft-mktQ4 2015 Earnings ReleaseQ4 20151.606
United Rentals IncURI USAft-mktQ4 2015 Earnings ReleaseQ4 20152.332
Crown Castle International CorpCCI USAft-mktQ4 2015 Earnings ReleaseQ4 20151.11
eBay IncEBAY USAft-mktQ4 2015 Earnings ReleaseQ4 20150.497
Juniper Networks IncJNPR USAft-mktQ4 2015 Earnings ReleaseQ4 20150.595
Ameriprise Financial IncAMP USAft-mktQ4 2015 Earnings ReleaseQ4 20152.348
Facebook IncFB USAft-mktQ4 2015 Earnings ReleaseQ4 20150.678
Discover Financial ServicesDFS USAft-mktQ4 2015 Earnings ReleaseQ4 20151.301
PayPal Holdings IncPYPL USAft-mktQ4 2015 Earnings ReleaseQ4 20150.345
Texas Instruments IncTXN US17:30Q4 2015 Earnings CallQ4 2015
Cisco Systems IncCSCO USITC Due to Release Findings in Cisco Systems vx. Arista Networks Patent Case
Posted by Jim Van Meerten at
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