Morning Call 6/14

Barchart Morning Call

Barchart.com - Wed Jun 14, 6:35AM CDT

OVERNIGHT MARKETS AND NEWS

Sep E-mini S&Ps (ESU17 +0.12%) this morning are up +0.11% and European stocks are up +0.81% as strength in technology stocks leads the overall market higher. Optimism in the global economy is another positive for equity prices after the IMF raised its China 2017 GDP estimate to 6.7% from a 6.6% estimate in Apr. European stocks also found support after data showed Eurozone Q1 employment rose +1.5% y/y, the largest increase in 9-years. Weakness in energy stocks limited gains in the overall market as Jul WTI crude oil (CLN17 -1.23%) slid -1.08% after API data late Tuesday showed U.S. crude inventories rose +2.75 million bbl last week. Trading activity was light ahead of the conclusion of today's FOMC meeting where the Fed is expected to raise the fed funds target range by 25 bp, but the markets will look to future Fed guidance and when it may begin to reduce its balance sheet. Asian stocks settled mostly lower: Japan -0.08%, Hong Kong +0.09%, China -0.73%, Taiwan -0.55%, Australia +1.06%, Singapore -0.13%, South Korea -0.02%, India +0.17%.

The dollar index (DXY00 +0.09%) is up +0.07%. EUR/USD (^EURUSD) is down -0.09%. USD/JPY (^USDJPY) is up +0.18%.

Sep 10-year T-note prices (ZNU17 +0.02%) are up +3 ticks.

The International Monetary Fund (IMF) raised its China 2017 GDP estimate to 6.7% from a 6.6% estimate in Apr.

China May industrial production rose +6.5% y/y, unch from Apr and stronger than expectations of +6.4% y/y.

Eurozone Apr industrial production rose +0.5% m/m and +1.4% y/y, right on expectations.

Eurozone Q1 employment rose +0.4% q/q and +1.5% y/y with the +1.5% y/y gain the largest year-on-year increase in 9 years.

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) weekly MBA mortgage applications (previous +7.1% with purchase sub-index +10.0% and refi sub-index +3.4%), (2) May CPI (expected unch m/m and +2.0% y/y, Apr +0.2% m/m and +2.2% y/y) and May CPI ex food & energy (expected +0.2% m/m and +1.9% y/y, Apr +0.1% m/m and +1.9% y/y), (3) May retail sales (expected +0.1% and +0.1% ex autos, Apr +0.4% and +0.3% ex autos), (4) Apr business inventories (expected -0.1%, Mar +0.2%), (5) FOMC announces interest rate decision with expected +25 bp increase in the fed funds target range to 1.00%-1.25%, (6) EIA Weekly Petroleum Status Report.

Notable Russell 2000 earnings reports today include: Jabil (consensus $0.29).

U.S. IPO's scheduled to price today: Boston Omaha (BOMN), Avenue Therapeutics (ATXI).

Equity conferences: Citi Industrials Conference on Tue-Wed, Morgan Stanley Financial Services Conference on Tue-Wed, William Blair & Company Growth Stock Conference on Tue-Thu, Deutsche Bank dbAccess Global Consumer Conference on Tue-Thu, Golddman Sachs European Payment Conference on Tue-Thu, Goldman Sachs Global Health Care Conference on Tue-Thu, Piper Jaffray Consumer Conference on Wed, Vertical Research Partners Materials Conference on Wed, RBC Capital Markets Financial Technology Investor Day on Wed, Drexel Hamilton Aerospace & Defense Conference on Thu, Stifel, Nicolaus & Co Industrials Conference on Thu, NASDAQ Investor Program on Thu.

OVERNIGHT U.S. STOCK MOVERS

Restaurant Brands International (QSR +0.68%) was upgraded to 'Outperform' from 'Market Perform' at Oppenheimer.

Infinera (INFN +1.20%) was upgraded to 'Buy' from 'Neutral' at MKM Partners with a price target of $14.

Starbucks (SBUX -0.60%) was downgraded to 'Neutral' from 'Outperform' at Wedbush.

HMS Holdings (HMSY +0.31%) was initiated with an 'Overweight' rating at Cantor Fitzgerald with a 12-month target price of $23.

Janus Henderson Group PLC (JHG +1.39%) was initiated with an 'Overweight' rating at Morgan Stanley.

Alexion Pharmaceuticals (ALXN +1.05%) rose 4% in after-hours trading after it announced that Biogen CFO Paul Clancy will be the new CFO at Alexion effective July 31. Biogen (BIIB -0.26%) dropped over 2% in after-hours trading on the news.

Loxo Oncology (LOXO -3.66%) lost over 2% in after-hours trading after it announced that it intends to offer shares of its common stock in an underwritten public offering, although no size was given.

H&R Block (HRB +2.08%) jumped over 11% in after-hours trading after it reported Q4 adjusted EPS from continuing operations of $3.76, better than consensus of $3.53.

FTD Cos (FTD -3.51%) was initiated with a 'Buy' at DA Davidson with a 12-month target price of $23.

Gladstone Investment Corp (GAIN +0.33%) was rated a new 'Outperform' at Wedbush with a 12-month target price of $10.

Sequans Communications SA (SQNS unch) dropped over 5% in after-hours trading after it announced that it intends to offer newly issued American Depositary Shares (ADSs) representing ordinary shares in an underwritten public offering, although no size was given.

MARKET COMMENTS

Sep E-mini S&Ps (ESU17 +0.12%) this morning are up +2.75 points (+0.11%). Tuesday's closes: S&P 500 +0.45%, Dow Jones +0.44%, Nasdaq +0.76%. The S&P 500 on Tuesday closed higher on a rebound in technology stocks after 2 days of sharp losses and on strength in energy stocks after crude prices rose +0.82%. Gains were limited ahead of the outcome of the 2-day FOMC meeting on Wednesday where the Fed is expected to raise its fed funds rate target by 25 bp.

Sep 10-year T-notes (ZNU17 +0.02%) this morning are up +3 ticks. Tuesday's closes: TYU7 +1.50, FVU7 unch. Sep 10-year T-notes on Tuesday closed higher on weaker inflation expectations after the 10-year T-note breakeven inflation rate fell to a 7-month low. There was also decent demand for the Treasury's $12 billion auction of 30-year T-bonds that had a bid-to-cover ratio of 2.32, above the 12-auction average of 2.30. T-note prices were undercut by rising producer price pressures after U.S. May core PPI rose +2.1% y/y, stronger than expectations of +1.9% y/y and the largest year-on-year increase in 3 years.

The dollar index (DXY00 +0.09%) this morning is up +0.07 (+0.07%). EUR/USD (^EURUSD) is down -0.0010 (-0.09%) and USD/JPY (^USDJPY) is up +0.20 (+0.18%). Tuesday's closes: Dollar index -0.163 (-0.17%), EUR/USD +0.0008 (+0.07%), USD/JPY +0.12 (+0.11%). The dollar index on Tuesday closed lower on reduced inflation expectations that may slow the pace of Fed tightening after the 10-year T-note breakeven inflation rate dropped to a 7-month low.

Jul WTI crude oil prices (CLN17 -1.23%) this morning are down -50 cents (-1.08%) and July gasoline (RBN17 -1.25%) is -0.0165 (-1.10%). Tuesday's closes: Jul crude +0.38 (+0.82%), Jul gasoline +0.0115 (+0.77%). Jul crude oil and gasoline on Tuesday closed higher on a weaker dollar and on expectations that Wednesday's weekly EIA data will show U.S. crude inventories fell -2.4 million bbl. Crude oil prices were undercut by speculation that increased U.S. oil production will offset OPEC crude production cuts and the projection from the EIA for U.S. Jul shale oil output to increase by +127,000 bpd.

GLOBAL EVENT CALENDAR06/14/2017

		Wednesday, June 14
US	0700 ET	Weekly MBA mortgage applications, previous +7.1% with purchase sub-index +10.0% and refi sub-index +3.4%.
	0830 ET	May CPI expected unch m/m and +2.0% y/y, Apr +0.2% m/m and +2.2% y/y. May CPI ex food & energy expected +0.2% m/m and +1.9% y/y, Apr +0.1% m/m and +1.9% y/y.
	0830 ET	May retail sales expected unch and +0.2% ex autos, Apr +0.4% and +0.3% ex autos.
	1000 ET	Apr business inventories expected -0.2%, Mar +0.2%.
	1030 ET	EIA Weekly Petroleum Status Report.
	1400 ET	FOMC announces interest rate decision, expected +25 bp increase in the fed funds target range to 1.00%-1.25%.
	1430 ET	Fed Chair Janet Yellen holds news conference following FOMC meeting.
		Thursday, June 15
US	0830 ET	Weekly initial unemployment claims expected -4,000 to 241,000, previous -10,000 to 245,000. Weekly continuing claims expected +6,000 to 1.923 million, previous -2,000 to 1.917 million.
	0830 ET	Jun Empire manufacturing survey general business conditions expected +6.0 to 5.0, May -6.2 to -1.0.
	0830 ET	Jun Philadelphia Fed business outlook survey expected -13.8 to 25.0, May +16.8 to 38.8.
	0830 ET	May import price index expected -0.1% m/m, Apr +0.5% and +0.4% ex petroleum.
	0830 ET	USDA weekly Export Sales.
	0915 ET	May industrial production expected +0.2%, Apr +1.0%. May manufacturing production expected +0.1%, Apr +1.0%. May capacity utilization expected +0.1 to 76.8%, Apr +0.5 to 76.7%.
	1000 ET	Jun NAHB housing market index expected unch at 70, May +2 to 70.
	1100 ET	Treasury announces amount of 30-year TIPS to be auctioned Jun 22 (previous $7 billion).

U.S. STOCK CALENDAR06/14/2017

Company	Ticker	Time	Event Description	Period	Estimate
American Airlines Group Inc	AAL US	09:00	Annual General Meeting
Target Corp	TGT US	09:00	Annual General Meeting
FNF Group	FNF US	10:00	Annual General Meeting
Zillow Group Inc	ZG US	11:00	Annual General Meeting
Black Knight Financial Services Inc	BKFS US		Annual General Meeting
Caterpillar Inc	CAT US		Annual General Meeting
Celgene Corp	CELG US		Annual General Meeting
Xcel Energy Inc	XEL US		Investor Meeting
Mattel Inc	MAT US	13:00	Investor Day
Square Inc	SQ US	16:00	Annual General Meeting
Jabil Inc	JBL US	Aft-mkt	Q3 2017 Earnings Release	Q3 17	0.289
Jabil Inc	JBL US	16:30	Q3 2017 Earnings Call	Q3 17
Autodesk Inc	ADSK US	18:00	Annual General Meeting

Morning Call 1/5

Barchart Morning Call

Barchart.com - 51 minutes ago

OVERNIGHT MARKETS AND NEWS

Mar E-mini S&Ps (ESH17 -0.20%) are down -0.03% and European stocks are up +0.14%. U.S. stock futures are being dragged lower by weakness in retailers with Kohl’s down 13% and Macy's down 10% in pre-market trading after both companies cut their 2017 EPS forecasts. Losses were limited as energy producers rose with Feb WTI crude oil (CLG17 +0.79%) up +0.94% after the API reported late Wednesday that U.S. crude supplies fell -7.43 million bbl last week. Feb COMEX gold (GCG17 +0.82%) is up +0.64% at a 3-week high and the German 10-year bund yield climbed to a 2-week high on increased price pressures after Eurozone Nov producer prices posted their first year-on-year increase in more than 3 years. Asian stocks settled mixed: Japan -0.37%, Hong Kong +1.46%, China +0.21%, Taiwan +0.77%, Australia +0.30%, Singapore +1.12%, South Korea -0.43%, India +0.92%. Japan's Nikkei Stock Index closed lower as exporter stocks sold-off after USD/JPY fell to a 3-week low, which reduces exporters' earnings prospects. China's Shanghai Composite climbed to a 3-week high on signs of strength in the Chinese economy after a gauge of growth in the service sector last month expanded at the fastest pace in 17 months.

The dollar index (DXY00 -0.43%) is down -0.31% at a 3-week low. EUR/USD (^EURUSD) is up +0.07%. USD/JPY (^USDJPY) is down -0.43% at a 3-week low.

Mar 10-year T-note prices (ZNH17 +0.13%) are up +3.5 ticks at a 3-week high.

The China Dec Caixin services PMI rose +0.3 to 53.4, the fastest pace of expansion in 17 months.

Eurozone Nov PPI unexpectedly rose +0.1% y/y, stronger than expectations of -0.1% y/y and the first year-on-year increase in 3-1/3 years.

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) Dec Challenger job cuts (Nov -13.0% y/y), (2) Dec ADP employment (expected +175,000, Nov +216,000), (3) weekly initial unemployment claims (expected -5,000 to 260,000, previous -10,000 to 265,000) and continuing claims (expected -51,000 to 2.051 million, previous +63,000 to 2.102 million), (4) revised Dec Markit services PMI (prelim-Dec -1.2 to 53.4), (5) Dec ISM non-manufacturing index (expected -0.5 to 56.7, Nov +2.4 to 57.2), (6) EIA Weekly Petroleum Status Report.

Russell 1000 earnings reports today include: Monsanto (consensus $0.02), Walgreens (1.09), Constellation Brands (1.72), RPM International (0.61).

U.S. IPO's scheduled to price today: none.

Equity conferences this week include: Citi Global Internet, Media and Telecommunications Conference on Tue-Thu, Goldman Sachs CEOs Unplugged Conference on Thu, J.P. Morgan CES Tech Forum on Thu, JP Morgan Chase & Co., Inc. International Tech Forum on Thu.

OVERNIGHT U.S. STOCK MOVERS

Macy's (M +1.73%) sank almost 10% in pre-market trading after it cut its 2017 EPS forecast to $2.95-$3.10 from a prior view of $3.15-$3.40 and said it plans to close 68 stores and cut 6,200 jobs.

Kohl's (KSS +4.22%) tumbled over 13% in pre-market trading after it said comparable same-store sales fell -2.1% y/y in the fiscal months of November and December combined, and then it cut its 2017 adjusted EPS forecast to $3.60-$3.65 from a November 10 estimate of $3.80-$4.00.

Adobe Systems (ADBE +0.64%) was rated a new 'Outperform' at BMO Capital Markets with a target price of $125.

McKesson (MCK +0.78%) was downgraded to 'Neutral' from 'Overweight' at JPMorgan Chase with an 18-month target price of $169.

Helix Energy Solutions Group (HLX +3.53%) sank 10% in after-hours trading after it proposed an offering of 21 million shares of common stock.

Buffalo Wild Wings (BWLD +1.32%) was downgraded to 'Neutral' from 'Outperform' at Wedbush with a price target of $155.

Mistras Group (MG +2.41%) slumped 10% in after-hours trading after it reported Q2 EPS of 26 cents, below consensus of 31 cents.

Kilroy Realty (KRC +1.48%) slid 3% in after-hours trading after it commenced an offering of 3.5 million shares of common stock.

Hudson Pacific Properties (HPP +1.23%) lost 1% in after-hours trading after holders offered 18.7 million shares of stock.

Alexion Pharmaceuticals (ALXN +3.65%) rallied over 3% in after-hours trading after a board audit committee concluded that it sees no need to restate financial results after investigating a claim made by a former employee about Soliris sales and practices.

Moelis (MC +2.65%) fell 4% in after-hours trading after it offered 5 million shares of Class A common stock.

Heron Therapeutics (HRTX +2.99%) dropped nearly 10% in after-hours trading after it forecast 2017 sales of its Sustol nausea treatment drug at $15 million to $25 million, well below consensus of $50 million.

Synergy Pharmaceuticals (SGYP +6.88%) climbed 3% in after-hours trading after it was rated a new 'Outperform' at Oppenheimer with a price target of $10.

Loxo Oncology (LOXO +5.28%) fell over 3% in after-hours trading after it proposed a public offering of common stock, although no amount or size was given.

MARKET COMMENTS

Mar E-mini S&Ps (ESH17 -0.20%) this morning are down -0.75 of a point (-0.03%). Wednesday's closes: S&P 500 +0.57%, Dow Jones +0.30%, Nasdaq +0.53%. The S&P 500 on Wednesday closed higher on strength in mining stocks after the price of copper rose +2.7% to a 2-week high and on strength in oil companies after the price of crude oil climbed +1.78%. Auto makers also saw strength after U.S. Dec auto sales soared to 18.29 million units, stronger than expectations of 17.70 million and the most in 11-1/3 years.

Mar 10-year T-notes (ZNH17 +0.13%) this morning are yp +3.5 ticks at a 3-week high. Wednesday's closes: TYH7 unch, FVH7 -0.50. Mar 10-year T-notes on Wednesday closed little changed. T-notes were undercut by weakness in German bunds on increased price pressures after the Eurozone Dec CPI rose more than expected. T-notes recovered their losses after the Dec 13-14 FOMC minutes said that most FOMC policy makers saw a gradual rate hike pace as "appropriate."

The dollar index (DXY00 -0.43%) this morning is down -0.32 (-0.31%) at a 3-week low. EUR/USD (^EURUSD) is up +0.0007 (+0.07%). USD/JPY (^USDJPY) is down -0.51 (-0.43%) at a 3-week low. Wednesday's closes: Dollar index -0.680 (-0.66%), EUR/USD +0.0084 (+0.81%), USD/JPY -0.50 (-0.42%). The dollar index on Wednesday closed lower on strength in EUR/USD after Eurozone Dec CPI rose +1.1% y/y, stronger than expectations of +1.0% y/y and the largest increase in 3-1/4 years, which dampened expectations that the ECB will expand stimulus measures. The dollar was also undercut by the comment in the Dec 13-14 FOMC meeting minutes that most FOMC members saw a gradual rate hike pace as "appropriate."

Feb WTI crude oil prices (CLG17 +0.79%) this morning are up +50 cents (+0.94%) and Feb gasoline (RBG17 -0.13%) is +0.0006 (+0.04%). Wednesday's closes: Feb crude +0.93 (+1.78%), Feb gasoline +0.0170 (+1.05%). Feb crude oil and gasoline on Wednesday closed higher on a weaker dollar and expectations for Thursday's weekly EIA crude inventories to fall -2.00 million bbl.

GLOBAL EVENT CALENDAR01/05/2017

		Thursday, Jan 5
US	0730 ET	Dec Challenger job cuts, Nov -13.0% y/y.
	0815 ET	Dec ADP employment change expected +175,000, Nov +216,000.
	0830 ET	Weekly initial unemployment claims expected -5,000 to 260,000, previous -10,000 to 265,000. Weekly continuing claims expected -51,000 to 2.051 million, previous +63,000 to 2.102 million.
	0945 ET	Revised Dec Markit services PMI, prelim-Dec -1.2 to 53.4.
	1000 ET	Dec ISM non-manufacturing index expected -0.5 to 56.7, Nov +2.4 to 57.2.
	1100 ET	EIA Weekly Petroleum Status Report.
	1100 ET	Treasury 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 Jan 10-12.
		Friday, Jan 6
US	0830 ET	Dec non-farm payrolls expected +180,000, Nov +178,000. Dec private payrolls expected +170,000, Nov +156,000. Dec manufacturing payrolls expected unch, Nov -4,000. Dec unemployment rate expected +0.1 to 4.7%, Nov -0.3 to 4.6%.
	0830 ET	Dec avg hourly earnings expected +0.3% m/m and +2.8% y/y, Nov -0.1% m/m and +2.5% y/y. Dec avg weekly hours all-employees expected unch at 34.4 hours, Nov unch at 34.4 hours.
	0830 ET	Nov trade balance expected -$44.7 billion, Oct -$42.6 billion.
	0830 ET	USDA weekly Export Sales.
	1000 ET	Nov factory orders expected -2.3%, Dec +2.7% and +0.8% ex transportation.
	1215 ET	Chicago Fed President Charles Evans (voter) participates in a NABE and AEA panel discussion titled Responders of First or Last Resort: Central Bank Strategies in an Era of Ultra-Low Interest Rates.
	1300 ET	Richmond Fed President Jeffrey Lacker (non-voter) speaks at the Maryland Bankers Associations Economic Outlook Forum.

U.S. STOCK CALENDAR01/05/2017

Company	Ticker	Time	Event Description	Period	Estimate
RPM International Inc	RPM US	Bef-mkt	Q2 2017 Earnings Release	Q2 2017	0.605
Constellation Brands Inc	STZ US	Bef-mkt	Q3 2017 Earnings Release	Q3 2017	1.718
Walgreens Boots Alliance Inc	WBA US	7:00	Q1 2017 Earnings Release	Q1 2017	1.093
L Brands Inc	LB US	7:30	December 2016 Sales and Revenue Call	2016
Monsanto Co	MON US	8:00	Q1 2017 Earnings Release	Q1 2017	0.017
Walgreens Boots Alliance Inc	WBA US	8:30	Q1 2017 Earnings Call	Q1 2017
Ionis Pharmaceuticals Inc	IONS US	9:30	IONIS-GCGR Rx Phase 2 Study Results Call
Monsanto Co	MON US	9:30	Q1 2017 Earnings Call	Q1 2017
RPM International Inc	RPM US	10:00	Q2 2017 Earnings Call	Q2 2017
Constellation Brands Inc	STZ US	10:30	Q3 2017 Earnings Call	Q3 2017
Gap Inc/The	GPS US	16:15	December 2016 Sales and Revenue Release	2016
L Brands Inc	LB US		December 2016 Sales and Revenue Release	2016