Barchart Morning Call
Barchart.com - Wed Mar 8, 6:30AM CST
OVERNIGHT MARKETS AND NEWS
Mar E-mini S&Ps (ESH17 -0.05%) this morning are down -0.05% and European stocks are down -0.15% as weakness in crude oil prices undercuts energy producing stocks. Apr WTI crude oil (CLJ17 -0.98%) is down -0.96% after API data late Tuesday showed U.S. crude inventories surged +11.6 million bbl last week. Mining stocks are also weaker as concern the Fed will raise interest rates at next week's FOMC meeting pressures precious metals prices with Apr COMEX gold (GCJ17-0.20%) down -0.20% and May COMEX silver (SIK17 -0.49%) down -0.60%, both at 1-month lows. On the positive side for European stocks, German Jan industrial production rose more than expected by the most in 5 months. Asian stocks settled mixed: Japan -0.47%, Hong Kong +0.43%, China -0.05%, Taiwan +0.16%, Australia -0.03%, Singapore +0.47%, South Korea +0.15%, India -0.34%. Losses in Chinese stocks were contained on signs of strength in domestic demand after China Feb imports surged +38.1% y/y. the biggest increase in 5-years.
The dollar index (DXY00 +0.12%) is up +0.09%. EUR/USD (^EURUSD) is down -0.06%. USD/JPY (^USDJPY) is up +0.03%.
Jun 10-year T-note prices (ZNM17 -0.20%) are down -7 ticks at a 1-1/2 month low ahead of the Treasury's $20 billion auction of 10-year T-notes later today.
German Jan industrial production rose +2.8% m/m, stronger than expectations of +2.7% m/m and the biggest increase in 5 months.
The China Feb trade balance fell to a deficit of -$9.15, billion less than expectations for a +$27.0 billion surplus and the largest deficit in 3-years. Feb exports unexpectedly fell -1.3% y/y, weaker than expectations of +14.0% y/y, and Feb imports rose +38.1% y/y, stronger than expectations of +20.0% y/y and the largest increase in 5-years.
U.S. STOCK PREVIEW
Key U.S. news today includes: (1) weekly MBA mortgage applications (previous +5.8% with purchase sub-index +6.5% and refi sub-index +5.1%), (2) Feb ADP employment change (expected +189,000, Jan +246,000), (3) revised Q4 non-farm productivity (expected +1.5%, previous +1.3%) and revised Q4 unit labor costs (expected +1.6%, previous +1.7%), (4) final-Jan wholesale inventories expected unrevised at -0.1%, (5) Treasury auctions $20 billion 10-year T-notes, (6) EIA Weekly Petroleum Status Report.
Notable Russell 1000 earnings reports today include: Valspar (consensus $0.73), Orbital ATK (1.47).
U.S. IPO's scheduled to price today: J. Jill Inc (JILL)
Equity conferences: Cowen and Company Health Care Conference on Mon-Wed, Deutsche Bank Media, Internet & Telecom Conference on Mon-Wed, Raymond James and Associates Institutional Investors Conference on Mon-Wed, RBC Capital Markets Financial Institutions Conference on Tue-Wed, Raymond James and Associates Institutional Investors Conference on Wed, Susquehanna Financial Group LLLP Semi Storage & Technology Conference on Thu, UBS Global Consumer & Retail Conference on Thu-Fri.
OVERNIGHT U.S. STOCK MOVERS
Caterpillar (CAT +0.28%) is down nearly 3% in pre-market trading after a report commissioned by the government and reviewed by the NYT accuses the company of tax and accounting fraud.
Urban Outfitters (URBN -1.05%) was downgraded to 'Market Perform' from 'Outperform' at William Clair & Co.
Michaels Cos. (MIK +2.29%) was upgraded to 'Buy' from 'Neutral' at Bank of America/Merrill Lynch with a price target of $28.
Armstrong World Industries (AWI -1.61%) slid 1% in after-hours trading after a 5.25 million share block was offered at $44.90-$45.40 via Deutsche Bank.
Skyworks Solutions (SWKS -0.42%) was rated a new 'Outperform' at Wells Fargo Securities.
Anadarko Petroleum (APC -0.14%) lost nearly 2% in after-hours trading after it said it sees 2017 capital expenditures (CAPEX) of $4.5 billion-$4.7 billion, more than consensus of $4.4 billion.
H&R Block (HRB -0.62%) jumped 7% in after-hours trading after it reported Q3 revenue of $451.9 million, higher than consensus of $427.4 million.
Bojangles' Inc. (BOJA -1.99%) dropped almost 8% in after-hours trading after it said it sees full-year revenue of $560 million-$569 million, less than consensus of $587.8 million.
Fox Factory Holding Corp. (FOXF unch) slid nearly 4% in after-hours trading after it announced a secondary public offering of 5.11 million shares.
Nimble Storage (NMBL +46.28%) was downgraded to 'Sector Weight' from 'Overweight' at Pacific Crest Securities.
Editas Medicine (EDIT +1.24%) fell nearly 6% in after-hours trading after it reported a Q4 EPS loss of -$1.10, much wider than consensus of -58 cents.
Aerovironment (AVAV +0.50%) rallied 5% in after-hours trading after it reported Q3 gross margin of 36.0%, better than consensus of 26.9%.
Health Insurance Innovations (HIIQ -3.61%) tumbled 12% in after-hours trading after it announced a secondary public offering by selling stockholders, although no size was given.
ZAGG Inc. (ZAGG -1.64%) climbed over 6% in after-hours trading after it said it sees full-year net sales of $470 million-$500 million, above consensus of $455.8 million.
MARKET COMMENTS
Mar E-mini S&Ps (ESH17 -0.05%) this morning are down -1.25 points (-0.05%). Tuesday's closes: S&P 500 -0.29%, Dow Jones -0.14%, Nasdaq -0.17%. The S&P 500 on Tuesday closed lower on the U.S. Jan trade deficit of -$48.5 billion, the biggest in 4-3/4 years, which is negative for Q1 GDP. There was also weakness in pharmaceutical stocks on speculation the Trump administration will soon unveil steps to lower drug prices after President Trump tweeted that he's working on a "new system where there will be more competition in the drug industry."
Jun 10-year T-notes (ZNM17 -0.20%) this morning are down -7 ticks at a 1-1/2 month low: Tuesday's closes: TYM7 -4.50, FVM7 -4.00. Jun T-notes on Tuesday closed lower on the OECD's projection for global growth this year to increase to 3.3% from 3.0% last year and on supply pressures as the Treasury auctions $56 billion of T-notes and T-bonds this week. Losses were limited as a slide in stocks boosted the safe-haven demand for T-notes.
The dollar index (DXY00 +0.12%) this morning is up +0.09 (+0.09%). EUR/USD (^EURUSD) is down -0.0006 (-0.06%). USD/JPY (^USDJPY) is up +0.03 (+0.03%). Tuesday's closes: Dollar index +0.17 (+0.17%), EUR/USD -0.0016 (-0.15%), USD/JPY +0.09 (+0.08%). The dollar index on Tuesday closed higher on weakness in EUR/USD after German Jan factory orders fell -7.4% m/m, the biggest decline in 8-years.
Apr WTI crude oil prices (CLJ17 -0.98%) this morning are down -51 cents (-0.96%) and Apr gasoline (RBJ17 +0.60%) is +0.0099 (+0.59%). Tuesday's closes: Apr crude -0.06 (-0.11%), Apr gasoline +0.0075 (+0.45%). Apr crude oil and gasoline on Tuesday settled mixed. Crude oil prices were boosted by comments from Iraq Oil Minister Al-Luaibi who said "it's likely" that OPEC will need to extend its production cuts, and by supply disruptions after rebels seized Libya's Es Sider terminal, the country's biggest oil port, which may reduce Libya's oil output of 700,000 bpd. Crude oil prices were undercut by a stronger dollar and expectations that Wednesday's EIA data will show crude supplies rose +1.4 million bbl.
GLOBAL EVENT CALENDAR03/08/2017
| Wed, Mar 8 | ||
| US | 0700 ET | Weekly MBA mortgage applications, previous +5.8% with purchase sub-index +6.5% and refi sub-index +5.1%. |
| 0815 ET | Feb ADP employment change expected +189,000, Jan +246,000. | |
| 0830 ET | Revised Q4 non-farm productivity expected +1.5%, previous +1.3%. Revised Q4 unit labor costs expected +1.6%, previous +1.7%. | |
| 1000 ET | Final-Jan wholesale inventories expected unrevised at -0.1%. Jan wholesale trade sales expected +0.5% m/m, Dec +2.6% m/m. | |
| 1030 ET | EIA Weekly Petroleum Status Report. | |
| 1300 ET | Treasury auctions $20 billion 10-year T-notes. | |
| Thu, Mar 9 | ||
| US | 0830 ET | Weekly initial unemployment claims expected +15,000 to 238,000, previous -19,000 to 223,000. Weekly continuing claims expected -3,000 to 2.063 million, previous +3,000 to 2.066 million. |
| 0830 ET | Feb import price index expected +0.1% m/m and +4.3% y/y, Jan +0.4% m/m and +3.7% y/y. | |
| 0830 ET | USDA weekly Export Sales. | |
| 1200 ET | USDA WASDE Mar crop production. | |
| 1300 ET | Treasury auctions $12 billion 30-year T-bonds. |
U.S. STOCK CALENDAR03/08/2017
| Company | Ticker | Time | Event Description | Period | Estimate |
|---|---|---|---|---|---|
| Linde AG | LIN GR | 0:30 | Y 2016 Earnings Release | Y 16 | |
| Merck KGaA | MRK GR | 1:00 | Y 2016 Earnings Release | Y 16 | 6.28 |
| Sekisui House Ltd | 1928 JP | 1:30 | Y 2017 Earnings Release | Y 17 (Cons) | |
| Sekisui House Ltd | 1928 JP | 1:30 | Y 2017 Earnings Release | Y 17 (Par) | |
| Staples Inc | SPLS US | Bef-mkt | Q4 2017 Earnings Release | Q4 17 | 0.25 |
| Carrefour SA | CA FP | Bef-mkt | Y 2016 Earnings Release | Y 16 | |
| Signet Jewelers Ltd | SIG US | 7:00 | Q4 2017 Earnings Release | Q4 17 | 4.03 |
| Aviva PLC | AV/ LN | Y 2016 Earnings Release | Y 16 | ||
| Hyundai Motor Co | 005380 KS | Q1 2017 Earnings Release | Q1 17 (Par) | ||
| Embraer SA | EMBR3 BZ | Y 2016 Earnings Release | Y 16 (Cons) | ||
| Wm Morrison Supermarkets PLC | MRW LN | Y 2017 Earnings Release | Y 17 | ||
| Old Mutual PLC | OML LN | Y 2016 Earnings Release | Y 16 | ||
| Ulta Beauty Inc | ULTA US | Aft-mkt | Q4 2017 Earnings Release | Q4 17 | 2.11 |
| Empresas CMPC SA | CMPC CI | Aft-mkt | Y 2016 Earnings Release | Y 16 |
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