BARCHART MORNING CALL 9/23

BARCHART MORNING CALL

Tuesday, September 23rd, 2014View Older Reports

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OVERNIGHT MARKETS AND NEWS

December E-mini S&Ps (ESZ14 -0.33%) this morning are down -0.25% and European stocks are down -1.22% after a gauge of European manufacturing activity weakened more than expected to its slowest pace in 14 months. Geopolitical concerns in the Middle East are another negative for stocks as Saudi Arabia, Jordan, the United Arab Emirates, Qatar and Bahrain joined the U.S. in a series of airstrikes against Islamic State positions in Syria along the Iraqi border. Meanwhile, Israel shot down a Syrian fighter jet after it penetrated Israeli airspace over the Golan Heights. Asian stocks closed mixed: Japan closed for holiday, Hong Kong -0.49%, China +0.86%, Taiwan -0.54%, Australia +0.98%, Singapore +0.05%, South Korea -0.64%, India -1.58%. Chinese stocks rallied and closed higher after a gauge of China's manufacturing activity unexpectedly increased. Commodity prices are mostly higher. Nov crude oil (CLX14 +0.78%) is up +0.47%. Nov gasoline (RBX14 +0.95%) is up +0.37%. Dec gold (GCZ14 +1.27%) is up +0.73%. Dec copper (HGZ14 +0.31%) is up +0.26%. Agriculture and livestock prices are mostly lower. The dollar index (DXY00 -0.37%) is down -0.35%. EUR/USD (^EURUSD) is up +0.29%. USD/JPY (^USDJPY) is down -0.35%. Dec T-note prices (ZNZ14 +0.11%) are up +4 ticks.
The Eurozone Sep Markit manufacturing PMI fell -0.2 to 50.5, a bigger drop than expectations of -0.1 to 50.6 and the slowest pace of expansion in 14 months.
The Eurozone Sep Markit composite PMI fell -0.2 to 52.3, weaker than expectations of no change at 52.5 and the slowest pace of expansion in 9 months.
The German Sep Markit/BME manufacturing PMI fell -1.1 to 50.3 a bigger decline than expectations of -0.2 to 51.2 and the slowest pace of expansion in 15 months.
The China Sep HSBC manufacturing PMI unexpectedly rose +0.3 to 50.5, better than expectations of -0.2 to 50.0.
UK Aug public sector net borrowing increased by +10.9 billion pounds, more than expectations of +10.2 billion pounds.

U.S. STOCK PREVIEW

The market is expecting today’s July FHFA house price index to rise by +0.4% m/m, matching the +0.4% m/m rise seen in June. The market is expecting today’s Sep Richmond Fed manufacturing index to show a -2 point decline to 10, reversing part of August’s increase of +5 points to 12. The Treasury today will auction $29 billion of 2-year T-notes. There are four of the Russell 1000 companies that report earnings today: CarMax (consensus $0.67), Bed Bath & Beyond (1.14), Copart (0.41), Carnival Corp (1.44).
Equity conferences during the remainder of this week include: Jefferies West Coast Electronic Payments Summit on Tue, UBS Chemicals Conference on Tue, Citi Industrial Conference on Mon-Tue, Capital Link Global Shipping, Marine Services & Offshore Forum on Tue, World LNG Series:Asia Pacific Summit on Tue-Thu, Avondale's Dallas Airlines Day on Wed, and 8th Rocky Mountain Utility Efficiency Exchange on Wed-Thu.

OVERNIGHT U.S. STOCK MOVERS

CarMax (KMX -1.42%) reported Q2 EPS of 70 cents, better than consensus of 67 cents.
Dresser-Rand (DRC +2.58%) was downgraded to 'Hold' from 'Buy' at KeyBanc.
Clorox (CLX +7.35%) was downgraded to 'Sell' from 'Neutral' at B. Riley.
Bed Bath & Beyond (BBBY -0.25%) was downgraded to 'Market Perform' from 'Outperform' at William Blair.
Fluor (FLR -2.46%) was downgraded to 'Market Perform' from 'Outperform' at Wells Fargo.
Cree (CREE -1.92%) was upgraded to 'Equal Weight' from 'Underweight' at Stephens.
Siemens (SIEGY -0.85%) was downgraded to 'Equal Weight' from 'Overweight' at Barclays.
Dick's Sporting Goods (DKS -1.61%) was downgraded to 'Market Perform' from 'Outperform' at William Blair.
Herbalife (HLF -10.31%) rose nearly 3% in after-hours trading after sources close to the matter said that billionaire activist investor Carl Icahn has not sold out of his stake in the company
AEGON (AEG unch) was upgraded to 'Buy' from 'Neutral' at Goldman Sachs.
Ascena Retail (ASNA -2.36%) slumped over 10% in after-hours trading after it reported Q4 adjusted EPS of 13 cents, well below consensus of 18 cents, and then lowered guidance on fiscal 2015 adjusted EPS to 90 cents-$1.00, weaker than consensus of $1.25.

MARKET COMMENTS

Dec E-mini S&Ps (ESZ14 -0.33%) this morning are down -5.00 points (-0.25%). The S&P 500 index on Monday closed lower: S&P 500 -0.80%, Dow Jones -0.62%, Nasdaq -0.95%. Negative factors included (1) carry-over weakness from a slide in global stocks after China’s finance minister dampened speculation his government will boost economic stimulus when he said that growth in China faces downward pressure and that there won’t be major changes in policy in response to individual economic indicators, (2) the unexpected drop in U.S. Aug existing home sales which fell -1.8% to 5.05 million, weaker than expectations of +1.0% to 5.20 million.
Dec 10-year T-notes (ZNZ14 +0.11%) this morning are up +4 ticks. Dec 10-year T-note futures prices on Monday closed higher. Bullish factors included (1) the unexpected decline in U.S. Aug existing home sales, (2) increased safe-haven demand for T-notes after stocks plunged, and (3) reduced inflation expectations as the 10-year T-note breakeven inflation rate dropped to a 14-1/2 month low. Closes: TYZ4 +9.00, FVZ4 +6.50.
The dollar index (DXY00 -0.37%) this morning is down -0.296 (-0.35%). EUR/USD (^EURUSD) is up +0.0037 (+0.29%) and USD/JPY (^USDJPY) is down -0.38 (-0.35%). The dollar index on Monday posted a new 4-year high and closed higher. Bullish factors included (1) a slide in EUR/USD to a 14-1/4 month low after Eurozone Sep consumer confidence fell more than expected to a 7-month low and after ECB President Draghi told the EU Parliament that the risks surrounding the expected expansion in the Eurozone “are clearly on the downside.” EUR/USD recovered, though, and closed higher after New York Fed President Dudley said that if the dollar “were to strengthen a lot” there would be consequences for economic growth. Closes: Dollar index +0.017 (+0.02%), EUR/USD +0.00194 (+0.15%), USD/JPY -0.199 (-0.18%).
Nov WTI crude oil (CLX14 +0.78%) this morning is up +43 cents (+0.47%) and Nov gasoline (RBX14 +0.95%) is up +0.0091 (+0.37%). Nov crude and gasoline prices on Monday closed lower: CLX4 -0.78 (-0.85%), RBXX4 -0.0369 (-1.46%). Bearish factors included (1) the rally in the dollar index to a fresh 4-year high, (2) Chinese demand concerns after China’s Finance Minister said China’s economic growth faces downward pressure, and (3) U.S. demand concerns after the unexpected decline in U.S. Aug existing home sales.

GLOBAL EVENT CALENDAR09/23/2014

US	0900 ET	St. Louis Fed President James Bullard delivers welcoming remarks to the St. Louis Feds community banking conference.
	0900 ET	Jul FHFA house price index expected +0.4% m/m, Jun +0.4% m/m.
	0920 ET	Fed Governor Jerome Powell and Kansas City Fed President Esther George speak at the St. Louis Feds community banking conference.
	0945 ET	Preliminary Sep Markit manufacturing PMI expected +0.1 to 58.0, Aug +2.1 to 57.9.
	1000 ET	Sep Richmond Fed manufacturing index expected -2 to 10, Aug +5 to 12.
	1300 ET	Treasury auctions $29 billion 2-year T-notes.
	1400 ET	Minneapolis Fed President Narayana Kocherlakota holds a town hall forum at Northern Michigan University.
	2115 ET	Kansas City Fed President Esther George speaks on the economy in Cheyenne, WY.
GER	0330 ET	German Sep Markit/BME manufacturing PMI expected -0.2 to 51.2, Aug 51.4. Sep Markit services PMI expected -0.3 to 54.6, Aug 54.9.
EUR	0400 ET	Eurozone Sep Markit composite PMI expected unch at 52.5.
UK	0430 ET	UK Aug public sector net borrowing expected +10.2 billion pounds, Jul -1.1 billion pounds.
JPN	2135 ET	Japan Sep Markit/JMMA manufacturing PMI, Aug 52.2.
	n/a	Japanese markets close for Autumnal Equinox Day.

U.S. STOCK CALENDAR09/23/2014

Company Name	Ticker	Time	Event Description	Period	Estimate
CarMax Inc	KMX US	Bef-mkt	Q2 2015 Earnings Release	Q2 2015	0.673
Norfolk Southern Corp	NSC US	7:45	Investor and Analyst Conference - Cleveland	Y 2014
Boston Properties Inc	BXP US	8:00	Investor Conference	Y 2014
TimkenSteel Corp	TMST US	8:00	Investor Conference	Y 2014
Urban Outfitters Inc	URBN US	9:00	Investor Day	Y 2014
CarMax Inc	KMX US	9:00	Q2 2015 Earnings Call	Q2 2015
Carnival Corp	CCL US	10:00	Q3 2014 Earnings Call	Q3 2014
Washington Prime Group Inc	WPG US	10:00	Acquisition of Glimcher Realty Trust by Washington Prime Group Inc. Call
General Mills Inc	GIS US	11:00	Annual General Meeting	Y 2014
Norfolk Southern Corp	NSC US	13:00	Investor and Financial Analyst Conference - Bellevue	Y 2014
Bed Bath & Beyond Inc	BBBY US	16:15	Q2 2015 Earnings Release	Q2 2015	1.144
Bed Bath & Beyond Inc	BBBY US	17:00	Q2 2015 Earnings Call	Q2 2015
Copart Inc	CPRT US	Aft-mkt	Q4 2014 Earnings Release	Q4 2014	0.408
Carnival Corp	CCL US		Q3 2014 Earnings Release	Q3 2014	1.439
Celgene Corp	CELG US		PDUFA, apremilast, psoriasis
Pepco Holdings Inc	POM US		Special Meeting - M&A Vote

Barchart Morning Call 3/8

Barchart Morning Call - 3/8

Friday, March 8th, 2013View Older Reports

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OVERNIGHT MARKETS AND NEWS

June E-mini S&Ps (ESH13 +0.28%) are up +0.37% this morning on a +1.03% rally in European stocks and mostly higher stocks in Asia. The markets are encouraged by today's continued drop in Spanish and Italian bond yields and by a +22% increase in Chinese Feb exports and upward revision in Japan's Q4 GDP to +0.2% q/q annualized from -0.4%, although Germany's Jan industrial production was weaker than expected at unchanged. Commodity prices this morning are mildly higher by 0.13%. April crude oil (CLJ13 -0.49%) is down -0.21%, April gasoline (RBJ13 +0.77%) is up +0.49%, April gold (GCJ13 -0.01%) is up +0.15%, May copper (HGK13 -0.27%) is down -0.40%, and agriculture prices are trading mostly higher. The dollar index (DXY00 +0.22%) is mildly higher by +0.11%. EUR/USD (^EURUSD) is little changed and USD/JPY (^USDJPY) is sharply higher by +0.94% as Japan's Jan trade balance showed a large deficit of -1.5 trillion yen. June 10-year T-notes (ZNM13 -0.14%) are down 5.5 ticks.
China's Feb exports rose sharply by +21.8% y/y, which was down from +25.8% in Jan but was much stronger than market expectations of +8.1%. Meanwhile, Feb imports fell by -15.2% y/y, weaker than market expectations of -8.5% y/y. The Feb trade balance showed a surplus of $15.25 billion, down from the $29.15 billion surplus in Jan but better than market expectations for a deficit of -$6.9 billion.
The Spanish 10-year bond yield today fell by another 7 bp to a new 2-1/3 year low of 4.83% as market concern about Spain continues to ease. The Italian 10-year bond yield fell by 3 bp to 4.56%.
German Jan industrial production was unchanged m/m and -1.3% y/y, which was weaker than market expectations of +0.4% m/m and -1.2% y/y. The report provided further evidence to show how the German economy is stagnating due to the Eurozone recession.
Japan's Feb Eco Watchers outlook index rose to 57.7 from 56.5 in Jan, while the Feb current index rose to 53.2 from 49.5.
Japan's Jan adjusted current account balance rose to 365 billion yen from a revised 115 billion yen in Dec. Japan's Jan trade balance showed a big deficit of -1.479 trillion yen, which was a bit narrower than market expectations of -1.5 trillion yen.
Japan's Q4 GDP was revised upward to +0.2% q/q annualized from the preliminary report of -0.4%.
North Korea today scrapped the 1953 armistice that called a truce in the Korean war and canceled the hotline with South Korea after the UN approved new sanctions. South Korea this week warned North Korea that any military provocation may be met not only with retaliation on the site of the attack but also possibly on command leadership facilities.

U.S. STOCK PREVIEW

Today’s Feb payroll report is expected to show an increase of +160,000, which would be just slightly below the 6-month trend increase of +177,000, but slightly above January’s increase of +157,000. Today’s Feb unemployment rate is expected to be unchanged from January’s 7.9% level. That would be 0.1 point above the 4-year low of 7.8% posted several times in late 2012.
There are three of the Russell 1000 companies that report earnings today: Foot Locker (consensus $0.73), Carnival (0.03), and Tahoe Resources (-0.15).

June E-mini S&Ps (ESH13 +0.28%) are up 5.75 points (+0.37%) on expectations for a solid payroll report this morning and on a sharp 1.03% rally in European stocks. The S&P 500 index on Thursday closed higher with the Dow at a record high and the S&P 500 at a 5-1/3 year high. Bullish factors included (1) the unexpected drop in weekly initial unemployment claims to a 6-week low, and (2) carry-over support from a rally in European stocks after S&P upgraded Portugal’s credit rating and ECB President Draghi said the Eurozone economy will stabilize this year. Closes: S&P 500 +0.18%, Dow Jones +0.23%, Nasdaq +0.25%.

OVERNIGHT U.S. STOCK MOVERS

• Foot Locker (FL +0.40%) reported Q4 adjusted EPS of 73 cents, right in line with the consensus of 73 cents.
• Fuel Systems (FSYS +3.63%) reported Q4 adjusted EPS of 1 cents, better than the consensus for a 3-cent loss.
• Continental Grain sent a letter to the Smithfield Foods (SFD +10.67%) board requesting that the board hire an investment bank to consider its strategic options, such as splitting the company into three independent companies.
• Carl Icahn raised his stake in Herbalife (HLF unch) to 15.55% from 13.6%.
• H&R Block (HRB -1.11%) reported an adjusted Q3 EPS loss of -22 cents, worse than consensus of -1 cent, saying total Q3 revenues fell -29% due to "timing issues" from the IRS opening its e-file system on January 30, which resulted in delays to the start of the U.S. tax season.
• WuXi PharmaTech (WX +0.46%) reported Q4 EPS of 38 cents, better than consensus of 30 cents.
• Medifast (MED +0.58%) reported Q4 adjusted EPS of 28 cents, better than consensus of 25 cents, but lowered its guidance on Q1 EPS to 32 cents to 35 cents, below consensus of 45 cents.
• Cooper Companies (COO -0.81%) reported Q1 EPS of $1.23, better than consensus of $1.19.
• Quiksilver (ZQK +0.96%) reported a Q1 EPS loss of -16 cents, worse than consensus of -7 cents.
• PowerSecure (POWR +5.30%) reported Q4 EPS of 13 cents, better than consensus of 11 cents.
• TiVo (TIVO +0.96%) was initiated with an "Overweight" at Piper Jaffray with a share price target of $16.
• Covanta (CVA -1.22%) announced that the Board of Directors has authorized a 10% increase of the company's quarterly cash dividend to 16.5 cents from 15 cents per share. The Board of Directors also increased the current share repurchase authorization to $150 million.
• Emergent BioSolutions (EBS +0.07%) reported Q4 EPS of 44 cents, slightly weaker than consensus of 45 cents.
• Finisar (FNSR +5.53%) reported Q3 adjusted EPS of 17 cents, slightly better than consensus of 16 cents.

MARKET COMMENTS

June 10-year T-notes (ZNM13 -0.14%) are down 5.5 ticks on reduced safe-haven demand with the rally in U.S. and European stock indexes. June 10-year T-note prices on Thursday slid to a 1-1/2 week low on the decline in unemployment claims and on reduced safe-haven demand with the Dow at a new record high and with Standard & Poor’s upgrading Portugal’s credit rating to stable from negative. Closes: TYM3 -15.5, FVM3 -7.75.
The dollar index (DXY00 +0.22%) is up +0.09 points (+0.11%). EUR/USD (^EURUSD) is virtually unchanged. USD/JPY (^USDJPY) is sharply higher by +0.89 yen (+0.94%) on today's Japanese trade deficit news. The dollar index on Thursday closed lower on reduced safe-haven demand as stocks rallied. EUR/USD strengthened after Standard & Poor’s upgraded Portugal’s credit rating outlook to stable from negative and after ECB President Draghi said the Eurozone economy will stabilize this year. USD/JPY posted a 3-1/2 year high on speculation the BOJ will expand its yen-negative monetary stimulus measures: Dollar index -0.378 (-0.46%), EUR/USD +0.0140 (+1.08%), USD/JPY +0.758 (+0.80%).
April WTI crude oil (CLJ13 -0.49%) is down -0.19 (-0.21%) and April gasoline (RBJ13 +0.77%) is up +0.0154 (+0.49%). Crude oil and gasoline prices on Thursday closed mixed as crude oil gained on economic optimism after the Dow rallied to another record high. However, gasoline weakened on signs of adequate supplies after the DOE on Wednesday reported that U.S. gasoline inventories in the important PADD1 district that includes NY Harbor (where Nymex gasoline is priced) rose by +651,000 bbl. Closes: CLJ3 +1.13 (+1.25%), RBJ3 -0.0014 (-0.04%).

GLOBAL EVENT CALENDAR03/08/2013

US	0830 ET	Feb non-farm payrolls expected +160,000, Jan +157,000. Feb private payrolls expected +167,000, Jan +166,000. Feb manufacturing payrolls expected +10,000, Jan +4,000. Feb unemployment rate expected unchanged at 7.9%, Jan +0.1 to 7.9%.
	0830 ET	U.S. Feb average hourly earnings expected +0.2% m/m and +2.1% y/y, Jan +0.2% m/m and +2.1% y/y. Feb average weekly hours all-employees expected unchanged at 34.4 hours, Jan 34.4 hours.
	1000 ET	Jan wholesale inventories expected +0.3% m/m, Dec -0.1% m/m.
JPN	0000 ET	Jan Feb Eco watchers survey outlook, Jan 56.5. Feb Eco watchers survey current, Jan 49.5.
GER	0600 ET	German Jan industrial production expected +0.4% m/m and -1.2% y/y, Dec +0.3% m/m and -1.1% y/y.
CHI	2030 ET	China Feb CPI expected +3.0% y/y, Jan +2.0% y/y. Feb PPI expected -1.5% y/y, Jan -1.6% y/y.

U.S. STOCK CALENDAR03/08/2013

Company Name	Symbol	Time	Event Description	Period	EPS Est (US$)
Foot Locker Inc	FL US	Bef-mkt	Q4 2013 Earnings Release	Q4 2013	0.726
Foot Locker Inc	FL US	9:00	Q4 2013 Earnings Call	Q4 2013
Analog Devices Inc	ADI US		ITC Scheduled to Release Findings for Dover Corp vs Analog Devices
Carnival Corp	CCL US		Q1 2013 Earnings Release	Q1 2013	0.032
Walt Disney Co/The	DIS US		Box Office Release of Movie Oz the Great and Powerful""
Dover Corp	DOV US		ITC Scheduled to Release Findings for Dover Corp vs Analog Devices
Hawaiian Electric Industries Inc	HE US		Financial Community Meeting - Day 3	Y 2013
Hill-Rom Holdings Inc	HRC US		Annual General Meeting
McDonald's Corp	MCD US		February 2013 Sales and Revenue Release	2013
Thor Industries Inc	THO US		Q2 2013 Earnings Release	Q2 2013	0.38
Tahoe Resources Inc	THO CN		Q4 2012 Earnings Release	Q4 2012	-0.147