Wednesday, August 2, 2017

Morning Call 8/2

Barchart Morning Call

Barchart.com - Wed Aug 2, 6:36AM CDT
OVERNIGHT MARKETS AND NEWS
Sep E-mini S&Ps (ESU17 +0.02%) this morning are up +0.06% due to strength in technology stocks as shares of Apple rally 6% in pre-market trading after it gave an upbeat revenue forecast ahead of the launch of its new iPhone next quarter. Apple suppliers Cirrus Logic and Skyworks Solutions are also up 3% in pre-market trading. European stocks are down -0.14% as exporter stocks decline after EUR/USD (^EURUSD) climbed to a new 2-1/2 year high, which undercuts European exporters' earnings prospects. Asian stocks settled mixed: Japan +0.47%, Hong Kong +0.24%, China -0.23%, Taiwan +0.79%, Australia -0.49%, Singapore +0.32%, South Korea +0.21%, India -0.30%. A rally in technology stocks in Asia after Apple's upbeat revenue forecast sent China's Shanghai Composite up to a 2-1/2 year high, although losses in raw-material producing stocks spurred long liquidation and the Shanghai Composite gave up its gains and closed lower.
The dollar index (DXY00 -0.07%) is down -0.07%. EUR/USD (^EURUSD) is up +0.25% at a 2-1/2 year high. USD/JPY (^USDJPY) is up +0.34%.
Sep 10-year T-note prices (ZNU17 -0.14%) are down -4.5 ticks ahead of the Treasury's announcement later this morning on the size of next week's quarterly refunding.
As expected, the Reserve Bank of India (RBI) cut its repurchase rate by 25 bp to 6.00% from 6.25% in a 5-1 vote and said, "some of the upside risks to inflation have either reduced or not materialized."
Eurozone Jun PPI of -0.1% m/m and +2.5% y/y was right on expectations with the +2.5% y/y gain the smallest year-on-year increase in 6-months.
The Japan Jul consumer confidence index rose +0.5 to 43.8, stronger than expectations of +0.2 to 43.5 and a 4-month high.
U.S. STOCK PREVIEW
Key U.S. news today includes: (1) weekly MBA mortgage applications (previous +0.4%, purchase sub-index -2.2%, refi sub-index +3.4%), (2) Jul ADP employment (expected +190,000, Jun +158,000), (3) Cleveland Fed President Lorretta Mester (non-voter) is keynote speaker at the Community Bankers Association of Ohio annual convention, (4) San Francisco Fed President John Williams (non-voter) speaks at an event in Las Vegas on “Monetary Policy’s Role in Fostering Sustainable Growth,” (5) EIA Weekly Petroleum Status Report.
Notable S&P 500 earnings reports today include: Time Warner (consensus $1.19), Exelon (0.52), Humana (3.07), Southern Co (0.71), Lincoln National (1.75), Occidental Petroleum (0.09), Prudential Financial (2.70), Williams Cos (0.20), MetLife (1.28), Fortune Brands (0.87), Marathon Oil (-0.15), Symantec (0.31), AIG (1.20).
U.S. IPO's scheduled to price today: Venator Materials (VNTR).
Equity conferences this week: UBS Transport Conference on Thu.

OVERNIGHT U.S. STOCK MOVERS
Apple (AAPL +0.89%) rallied over 6% in pre-market trading to a record high after it reported Q3 EPS of $1.67, better than consensus of $1.57, and then said it sees Q4 revenue of $49 billion-$52 billion, the midpoint well above consensus of $49.12 billion. Apple suppliers Cirrus Logic (CRUS +2.67%) and Skyworks Solutions (SWKS -0.56%) are also up 3% in pre-market trading.
Ultimate Software Group (ULTI +0.57%) tumbled 11% in after-hours trading after it reported Q2 revenue of $224.7 million, weaker than consensus of $228 million, and then said it sees Q3 revenue of $201 million-$203 million, below consensus of $245.4 million.
Illumina (ILMN -0.89%) jumped 9% in after-hours trading after it reported Q2 adjusted EPS 0of 82 cents, better than consensus of 68 cents, and then said it sees full-year adjusted EPS of $3.560-$3.70, the midpoint above consensus of $3.63.
Allstate (ALL unch) gained 2% in after-hours trading after it reported Q2 operating EPS of $1.38, well above consensus of 87 cents and said its board approved a new $2 billion share repurchase program.
Fiserv (FISV +0.60%) dropped over 2% in after-hours trading after it reported Q2 adjusted EPS of $1.19, less than consensus of $1.23, and then said it sees full-year adjusted EPS of $5.02-$5.17, the midpoint below consensus of $5.12.
Hanesbrands (HBI +0.52%) rose over 3% in after-hours trading after it said it sees full-year net sales of $6.45 billion to $6.55 billion, above consensus of $6.44 billion.
Terex (TEX -1.22%) rose 4% in after-hours trading after it raised guidance on its full-year EPS view to $1.05-$1.15 from a prior view of 80 cents-95 cents, above consensus of 98 cents.
Coherent (COHR +2.26%) sank 18% in after-hours trading after it reported Q3 net sales of $464.1 million, weaker than consensus of $467 million.
Herbalife (HLF +0.02%) lost 4% in after-hours trading after it said it sees full-year adjusted EPS of $4.30-$4.70, the midpoint below consensus of $4.62.
FireEye (FEYE +0.41%) climbed nearly 7% in after-hours trading after it reported a Q2 adjusted loss of -4 cents per share, a smaller loss than expectations of -12 cents, and then raised its 2017 revenue estimate to $734 million-$746 million from a prior view of $724 million-$736 million.
MACOM Technology Solutions Holdings (MTSI +0.84%) plunged 20% in after-hours trading after it reported Q3 adjusted EPS of 67 cents, weaker than consensus of 68 cents, and then said it sees Q4 adjusted EPS of 45 cents-50 cents, below consensus of 75 cents.
Frontier Communications (FTR +3.79%) lost nearly 6% in after-hours trading after it reported a Q2 adjusted loss per share of -$1.10, a wider loss than expectations of -$1.02.
Big 5 Sporting Goods (BGFV +1.86%) tumbled over 13% in after-hours trading after it said it expects Q3 same store sales to be in the negative low single-digit range with Q3 EPS of 22 cents-32 cents, below consensus of 39 cents.
MARKET COMMENTS
Sep S&P 500 E-mini stock futures (ESU17 +0.02%) this morning are up +1.50 points (+0.06%). Tuesday's closes: S&P 500 +0.24%, Dow Jones +0.33%, Nasdaq +0.25%. The S&P 500 on Tuesday closed higher on signs of strength in the global economy after Eurozone Q2 GDP grew at a +2.1% y/y pace, the strongest year-on-year increase in 6 years, and after the China Jul Caixin manufacturing PMI rose +0.7 to 51.1, the fastest pace of expansion in 4 months. Stocks also continued to see underlying strength from the positive Q2 earnings season. Stocks were undercut by the U.S. Jun personal income report of unchanged (weaker expectations of +0.4%) and by the unexpected -1.3% decline in U.S. Jun construction spending (weaker than expectations of +0.4%).
Sep 10-year T-note prices (ZNU17 -0.14%) this morning are down -4.5 ticks. Tuesday's closes: TYU7 +11, FVU7 +4.75. Sep 10-year T-notes on Tuesday closed higher on the unexpected stagnation in U.S. Jun personal income report of unchanged (weaker than expectations of +0.4%) and the unexpected -1.3% m/m decline in U.S. Jun construction spending. T-notes were also supported by the -2% slide in crude oil prices, which reduces inflation expectations.
The dollar index (DXY00 -0.07%) this morning is down -0.067 (-0.07%). EUR/USD (^EURUSD) is up +0.0030 (+0.25%) at a new 2-1/2 year high and USD/JPY (^USDJPY) is up +0.38 (+0.34%). Tuesday's closes: Dollar Index +0.180 (+0.19%), EUR/USD -0.0040 (-0.34%), USD/JPY +0.10 (+0.09%). The dollar index on Tuesday closed higher on weakness in the currencies of the crude-oil-exporting countries of Canada and Russia after crude oil prices tumbled -2%. The dollar also found support on U.S. Jul ISM manufacturing index report of -1.5 to 56.3, which was close to expectations and signaled that U.S. manufacturing activity remains in expansionary territory.
Sep crude oil (CLU17 -0.02%) this morning is up +7 cents (+0.14%). Sep gasoline (RBU17 +0.12%) is up +0.0034 (+0.20%). Tuesday's closes: Sep WTI crude -1.01 (-2.01%), Sep gasoline -0.0153 (-0.91%). Sep crude oil and gasoline on Tuesday closed lower on a stronger dollar and on increased OPEC crude output that may prolong the global oil glut after OPEC Jul crude production rose +210,000 bpd to 7-month high of 32.87 million bpd.
GLOBAL EVENT CALENDAR08/02/2017
Wednesday, Aug 2
US0700 ETWeekly MBA mortgage applications, previous +0.4%, purchase sub-index -2.2%, refi sub-index +3.4%.
0815 ETJul ADP employment change expected +190,000, Jun +158,000.
0830 ETTreasury announces amount of 3-year T-notes (previous $24 billion), 10-year T-notes (previous $20 billion) and 30-year T-bonds (previous $12 billion) to be auctioned Aug 8-10 in the Treasurys quarterly refunding.
1030 ETEIA Weekly Petroleum Status Report.
1200 ETCleveland Fed President Lorretta Mester (non-voter) is keynote speaker at the Community Bankers Association of Ohio annual convention.
1530 ETSan Francisco Fed President John Williams (non-voter) speaks at an event in Las Vegas on Monetary Policys Role in Fostering Sustainable Growth.
Thursday, Aug 3
US0730 ETJul Challenger job cuts, Jun -19.3% y/y.
0830 ETWeekly initial unemployment claims expected -2,000 to 242,000, previous +10,000 to 244,000. Weekly continuing claims expected -6,000 to 1.958 million, previous -13,000 to 1.964 million.
0830 ETUSDA weekly Export Sales.
0945 ETFinal-Jul Markit U.S. services PMI expected unch at 54.2, prelim-Jul unch at 54.2.
1000 ETJul ISM non-manufacturing expected -0.5 to 56.9, Jun +0.5 to 57.4.
1000 ETJun factory orders expected +3.0%, May -0.8% and -0.3% ex transportation.
U.S. STOCK CALENDAR08/02/2017
CompanyTickerTimeEvent DescriptionPeriodEstimate
GGP IncGGP USBef-mktQ2 2017 Earnings ReleaseQ2 170.353
Cardinal Health IncCAH USBef-mktQ4 2017 Earnings ReleaseQ4 171.244
Fidelity National Information Services IncFIS USBef-mktQ2 2017 Earnings ReleaseQ2 170.972
Vulcan Materials CoVMC USBef-mktQ2 2017 Earnings ReleaseQ2 171.201
AMETEK IncAME USBef-mktQ2 2017 Earnings ReleaseQ2 170.623
Time Warner IncTWX USBef-mktQ2 2017 Earnings ReleaseQ2 171.19
Dominion Energy IncD USBef-mktQ2 2017 Earnings ReleaseQ2 170.667
AutoNation IncAN USBef-mktQ2 2017 Earnings ReleaseQ2 170.972
Exelon CorpEXC USBef-mktQ2 2017 Earnings ReleaseQ2 170.524
Entergy CorpETR USBef-mktQ2 2017 Earnings ReleaseQ2 171.184
Garmin LtdGRMN USBef-mktQ2 2017 Earnings ReleaseQ2 170.809
NiSource IncNI USBef-mktQ2 2017 Earnings ReleaseQ2 170.101
Humana IncHUM US06:30Q2 2017 Earnings ReleaseQ2 173.068
Delphi Automotive PLCDLPH US06:45Q2 2017 Earnings ReleaseQ2 171.655
Mondelez International IncMDLZ US07:00Q2 2017 Earnings ReleaseQ2 170.457
Southern Co/TheSO US07:30Q2 2017 Earnings ReleaseQ2 170.709
Level 3 Communications IncLVLT US08:00Q2 2017 Earnings ReleaseQ2 170.376
Mondelez International IncMDLZ US08:00Q2 2017 Earnings CallQ2 17
Molson Coors Brewing CoTAP US08:00Q2 2017 Earnings ReleaseQ2 172.117
Principal Financial Group IncPFG US08:00Roadshow - Day 1
Assurant IncAIZ US08:00Q2 2017 Earnings CallQ2 17
Cardinal Health IncCAH US08:30Q4 2017 Earnings CallQ4 17
Fidelity National Information Services IncFIS US08:30Q2 2017 Earnings CallQ2 17
AMETEK IncAME US08:30Q2 2017 Earnings CallQ2 17
Verisk Analytics IncVRSK US08:30Q2 2017 Earnings CallQ2 17
NiSource IncNI US08:30Q2 2017 Earnings CallQ2 17
GGP IncGGP US09:00Q2 2017 Earnings CallQ2 17
Range Resources CorpRRC US09:00Q2 2017 Earnings CallQ2 17
Humana IncHUM US09:00Q2 2017 Earnings CallQ2 17
FMC CorpFMC US09:00Q2 2017 Earnings CallQ2 17
EOG Resources IncEOG US09:00Q2 2017 Earnings CallQ2 17
Allstate Corp/TheALL US09:00Q2 2017 Earnings CallQ2 17
Delphi Automotive PLCDLPH US09:00Q2 2017 Earnings CallQ2 17
Dominion Energy IncD US09:00Q2 2017 Earnings CallQ2 17
Pioneer Natural Resources CoPXD US10:00Q2 2017 Earnings CallQ2 17
Boston Properties IncBXP US10:00Q2 2017 Earnings CallQ2 17
Entergy CorpETR US10:00Q2 2017 Earnings CallQ2 17
Garmin LtdGRMN US10:30Q2 2017 Earnings CallQ2 17
Devon Energy CorpDVN US11:00Q2 2017 Earnings CallQ2 17
Newfield Exploration CoNFX US11:00Q2 2017 Earnings CallQ2 17
Extra Space Storage IncEXR US11:00Q2 2017 Earnings CallQ2 17
Vulcan Materials CoVMC US11:00Q2 2017 Earnings CallQ2 17
Molson Coors Brewing CoTAP US11:00Q2 2017 Earnings CallQ2 17
ONEOK IncOKE US11:00Q2 2017 Earnings CallQ2 17
AutoNation IncAN US11:00Q2 2017 Earnings CallQ2 17
Exelon CorpEXC US11:00Q2 2017 Earnings CallQ2 17
Southern Co/TheSO US13:00Q2 2017 Earnings CallQ2 17
Lincoln National CorpLNC USAft-mktQ2 2017 Earnings ReleaseQ2 171.745
CenturyLink IncCTL USAft-mktQ2 2017 Earnings ReleaseQ2 170.489
Occidental Petroleum CorpOXY USAft-mktQ2 2017 Earnings ReleaseQ2 170.089
Prudential Financial IncPRU USAft-mktQ2 2017 Earnings ReleaseQ2 172.703
Concho Resources IncCXO USAft-mktQ2 2017 Earnings ReleaseQ2 170.428
Macerich Co/TheMAC USAft-mktQ2 2017 Earnings ReleaseQ2 170.937
CF Industries Holdings IncCF USAft-mktQ2 2017 Earnings ReleaseQ2 17(0.015)
Williams Cos Inc/TheWMB USAft-mktQ2 2017 Earnings ReleaseQ2 170.202
MetLife IncMET USAft-mktQ2 2017 Earnings ReleaseQ2 171.281
AvalonBay Communities IncAVB USAft-mktQ2 2017 Earnings ReleaseQ2 172.099
ANSYS IncANSS USAft-mktQ2 2017 Earnings ReleaseQ2 170.914
Fortune Brands Home & Security IncFBHS USAft-mktQ2 2017 Earnings ReleaseQ2 170.872
Qorvo IncQRVO US16:00Q1 2018 Earnings ReleaseQ1 180.805
CA IncCA USAft-mktQ1 2018 Earnings ReleaseQ1 180.553
Citrix Systems IncCTXS USAft-mktQ2 2017 Earnings ReleaseQ2 170.996
Equinix IncEQIX USAft-mktQ2 2017 Earnings ReleaseQ2 173.305
American Water Works Co IncAWK USAft-mktQ2 2017 Earnings ReleaseQ2 170.792
Hologic IncHOLX USAft-mktQ3 2017 Earnings ReleaseQ3 170.494
Cincinnati Financial CorpCINF USAft-mktQ2 2017 Earnings ReleaseQ2 170.495
Federal Realty Investment TrustFRT USAft-mktQ2 2017 Earnings ReleaseQ2 171.458
Marathon Oil CorpMRO USAft-mktQ2 2017 Earnings ReleaseQ2 17(0.149)
Symantec CorpSYMC US16:05Q1 2018 Earnings ReleaseQ1 180.307
American International Group IncAIG US16:15Q2 2017 Earnings ReleaseQ2 171.196
CenturyLink IncCTL US16:30Q2 2017 Earnings CallQ2 17
Fortune Brands Home & Security IncFBHS US16:30Q2 2017 Earnings CallQ2 17
Hologic IncHOLX US16:30Q3 2017 Earnings CallQ3 17
Citrix Systems IncCTXS US16:45Q2 2017 Earnings CallQ2 17
Qorvo IncQRVO US17:00Q1 2018 Earnings CallQ1 18
Symantec CorpSYMC US17:00Q1 2018 Earnings CallQ1 18
CA IncCA US17:00Q1 2018 Earnings CallQ1 18
Level 3 Communications IncLVLT US17:30Q2 2017 Earnings CallQ2 17
Equinix IncEQIX US17:30Q2 2017 Earnings CallQ2 17
Posted by Jim Van Meerten at
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