BARCHART MORNING CALL 12/12

BARCHART MORNING CALL

Friday, December 12th, 2014View Older Reports

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OVERNIGHT MARKETS AND NEWS

March E-mini S&Ps (ESH15 -0.40%) this morning are down -0.53% at a 1-month low and European stocks are down -1.34% at a 3-week low as a drop in crude oil to a 5-1/3 year low undercuts energy producers. Chinese economic concerns also weighed on stocks after Nov China industrial output grew less than expected. The plunge in oil prices has also pressured the Russian ruble which plunged to a record low of 57.974 per dollar and has now lost over 30% of its value in the last 3 weeks. Asian stocks closed mixed: Japan +0.66%, Hong Kong -0.27%, China +0.32%, Taiwan +0.16%, Australia -0.22%, Singapore +0.16%, South Korea +0.37%, India -0.91%. Chinese stocks closed higher despite weaker-than-expected China Nov industrial production on speculation the government will boost its stimulus measures, while Japanese stocks rose ahead of Sunday's national elections in Japan where Prime Minister Abe's LDP party is expected to win in a landslide, which will allow him to push ahead with his fiscal policies. Commodity prices are mixed. Jan crude oil (CLF15 -1.07%) is down -0.88% at a 5-1/3 year low after the IEA cut its global oil demand forecast for the fourth time in five months when it said global oil demand in 2015 will grow by 900,000 bpd, 230,000 bpd less than previously forecast, to 93.3 million bpd. Jan gasoline (RBF15 +0.02%) is up +0.24%. Feb gold (GCG15 -0.24%) is down -0.16%. Mar copper (HGH15 +0.39%) is up +0.45%. Agriculture prices are higher. The dollar index (DXY00 -0.37%) is down -0.43%. EUR/USD (^EURUSD) is up +0.32%. USD/JPY (^USDJPY) is down -0.27%. Mar T-note prices (ZNH15 +0.33%) are up +15.5 ticks at a 1-1/2 week high on carry-over support from a rally in European government bonds to record highs as the 10-year German bund yield fell to an all-time low of 0.636%.
China Nov new yuan loans were 852.7 billion yuan, more than expectations of 655.0 billion yuan. Nov aggregate financing, China's broadest measure of credit, rose +1.15 trillion yuan, more than expectations of 895.0 billion yuan and the most in 5 months.
China Nov industrial production rose +7.2% y/y, less than expectations of +7.5% y/y.
China Nov retail sales climbed +11.7% y/y, stronger than expectations of +11.5% y/y.
Eurozone Q3 employment rose +0.2% q/q and +0.6% y/y with the +0.6% y/y increase the largest annual gain since Q2 of 2011.
Eurozone Oct industrial production rose +0.1% m/m, less than expectations of +0.2% m/m. On an annual basis Oct industrial production rose +0.7% y/y, right on expectations.
The German Nov wholesale price index fell -0.7% m/m and -1.1% y/y, a faster pace of decline from Oct when wholesale prices fell -0.6% m/m and -0.7% y/y.
UK Oct construction output unexpectedly fell -2.2% m/m, when expectations were for a +0.7% m/m increase. On an annual basis Oct construction output rose +0.7% y/y, less than expectations of +1.3% y/y.

U.S. STOCK PREVIEW

Today’s preliminary Dec U.S. consumer confidence index from the University of Michigan is expected to rise by +0.7 points to 89.5, adding to November’s rise of +1.9 points to a 7-1/3 year high 88.8. Today’s Nov final-demand PPI report is expected to fall to +1.4% y/y from +1.5% y/y in October. However, excluding food and energy, today’s Nov final-demand core PPI is expected to be unchanged at +1.8% y/y from October. None of the Russell 1000 companies report earnings today. There are no equity conferences today.

OVERNIGHT U.S. STOCK MOVERS

Morgan Stanley (MS +0.03%) was downgraded to 'Neutral' from 'Buy' at Buckingham.
Costco (COST +0.83%) was downgraded to 'Neutral' from 'Buy' at Janney Capital.
Sherwin-Williams (SHW +3.00%) lowered guidance on fiscal 2014 EPS to $8.75-$8.80, below consensus of $8.81, and also lowered guidance on fiscal 2015 EPS to $10.65-$10.85, below consensus of $10.87.
Mindray Medical (MR -0.28%) was downgraded to 'Underweight' from 'Equal Weight' at Morgan Stanley.
Avery Dennison (AVY +0.80%) was upgraded to 'Buy' from 'Hold' at Topeka.
Goodrich Petroleum (GDP +14.21%) was downgraded to 'Underweight' from 'Overweight' at JPMorgan Chase.
Lazard (LAZ -0.95%) was upgraded to 'Outperform' from 'Market Perform' at Keefe Bruyette.
CI Investments reported a 5.16% passive stake in Forest City (FCE.A -0.24%) .
United Technologies (UTX +0.48%) lowered guidance on fiscal 2014 EPS to approximately $6.80, below consensus of $6.87, and also lowered guidance on fiscal 2015 EPS to $7.00-$7.20, less than consensus of $7.27.
Nordson (NDSN +1.58%) reported Q4 EPS of $1.15, higher than consensus of $1.13.
Quiksilver (ZQK -2.63%) reported a Q4 EPS loss of -29 cents, a much bigger loss than consensus of -11 cents.
Esterline (ESL +0.38%) reported Q4 adjusted EPS of $1.82, less than consensus of $1.85.
Adobe (ADBE -0.16%) jumped over 7% in after-hours trading after it reported Q4 adjusted EPS of 36 cents, higher than consensus of 30 cents.

MARKET COMMENTS

Mar E-mini S&Ps (ESH15 -0.40%) this morning are down -10.75 points (-0.53%) at a 1-month low. The S&P 500 index on Thursday closed higher: S&P 500 +0.45%, Dow Jones +0.36%, Nasdaq +0.51%. Bullish factors included (1) the +0.7% increase in U.S. Nov retail sales, stronger than expectations of +0.4% and the most in 8 months, (2) the unexpected -3,000 decline in U.S. weekly initial unemployment claims, better than expectations of no change, and (3) slack price pressures after U.S. Nov import prices fell -1.5% m/m and -2.3% y/y, the fastest pace of decline in 1-1/2 years.
Mar 10-year T-notes (ZNH15 +0.33%) this morning are yp +15.5 ticks at a 1-1/2 week high. Mar 10-year T-note futures prices on Thursday fell back from a 1-week high and closed lower: TYH5 -7.00, FVH5 -6.00. Bearish factors included (1) the stronger-than-expected U.S. Nov retail sales, and (2) reduced safe-haven demand for Treasuries after stocks rallied sharply. Losses were limited on carry-over support from a rally in German bund prices to an all-time high.
The dollar index (DXY00 -0.37%) this morning is down -0.377 (-0.43%). EUR/USD (^EURUSD) is up +0.0040 (+0.32%). USD/JPY (^USDJPY) is down -0.32 (-0.27%). The dollar index on Thursday closed higher. Closes: Dollar index +0.392 (+0.44%), EUR/USD -0.00366 (-0.29%), USD/JPY +0.83 (+0.70%). Supportive factors included (1) the stronger-than-expected U.S. Nov retail sales, which may bring the Fed closer to raising interest rates, (2) weakness in the yen after USD/JPY recovered from a 3-week low and closed higher after the Kyodo News reported that Japanese Prime Minister Abe’s party may win more than 300 of 475 lower house seats in the Dec 14 election, which would give Abe a clear mandate to continue his yen-negative fiscal policies.
Jan WTI crude oil (CLF15 -1.07%) this morning is down -53 cents (-0.88%) at a new 5-1/3 year low and Jan gasoline (RBF15 +0.02%) is up +0.0039 (+0.24%). Jan crude and Jan gasoline prices Thursday closed lower with Jan crude at a 5-1/3 year low and Jan gasoline at a 5-year low. Closes: CLF5 -2.88 (-4.51%), RBF5 -0.0781 (-4.53%). Bearish factors included (1) a rally in the dollar, and (2) comments from Saudi Arabian Oil Minister Ali Al-Naimi who said Saudi Arabia will not cut oil production, “the market will correct itself.” A bullish factor was the larger-than-expected increase in U.S. Nov retail sales, which signals economic strength that is positive for fuel demand.

GLOBAL EVENT CALENDAR12/12/2014

US	0830 ET	Nov final-demand PPI expected -0.1% m/m and +1.4% y/y, Oct +0.2% m/m and +1.5% y/y. Nov final-demand PPI ex food & energy expected +0.1% m/m and +1.8% y/y, Oct +0.4% m/m and +1.8% y/y.
	0955 ET	Preliminary Dec U.S. consumer confidence (University of Michigan) expected +0.7 to 89.5, Nov +1.9 to 88.8.
CHI	0030 ET	China Nov industrial production expected +7.5% y/y, Oct +7.7% y/y
	0030 ET	China Nov retail sales expected +11.5% y/y, Oct +11.5% y/y.
UK	0430 ET	UK Oct construction output expected +0.7% m/m and +1.3% y/y, Sep +1.8% m/m and +3.5% y/y.
EUR	0500 ET	Eurozone Oct industrial production expected +0.2% m/m and +0.7% y/y, Sep +0.6% m/m and +0.6% y/y.
	0500 ET	Eurozone Q3 employment, Q2 +0.2% q/q and +0.4% y/y.

U.S. STOCK CALENDAR12/12/2014

Company	Ticker	Time	Event Description	Period	Estimate
WW Grainger Inc	GWW US	8:00	November 2014 Sales and Revenue Call	2014
WW Grainger Inc	GWW US	8:00	November 2014 Sales and Revenue Release	2014
Principal Financial Group Inc	PFG US	8:00	Roadshow - Europe - Day 2	Y 2014
MetLife Inc	MET US	8:00	Business Update Call
Alnylam Pharmaceuticals Inc	ALNY US	8:00	R&D Day	Y 2014
Nordson Corp	NDSN US	8:30	Q4 2014 Earnings Call	Q4 2014
Centene Corp	CNC US	8:30	Investor Meeting	Y 2014
Nu Skin Enterprises Inc	NUS US	12:00	Investor Day	Y 2014
Twenty-First Century Fox Inc	FOXA US		U.S. Box Office Release of Movie Exodus: Gods and Kings""
Palo Alto Networks Inc	PANW US		Annual General Meeting

Barchart Morning Call 9/4

Barchart Morning Call

BC - Wed Sep 04, 6:49AM CDT

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OVERNIGHT MARKETS AND NEWS

September E-mini S&Ps (ESU13 unch) this morning are down -0.02% and European stocks are down -0.71%. Asian stocks closed mixed: Japan +0.54%, Hong Kong -0.31%, China -0.16%, Taiwan -0.06%, Australia -0.67%, Singapore -1.29%, South Korea +0.04%, India +1.83%. U.S. and European stocks are under pressure amid concern the U.S. is closer to a military strike against Syria. The U.S. Senate Foreign Relations Committee is due today to vote on a resolution that sets a 90-day limit on military action against Syria. Commodity prices are mostly lower. Oct crude oil (CLV13 -0.41%) is down -0.61% after Russia raised objections to military action against Syria, which further clouds the prospects for an attack, when Russian President Putin said he will only support a UN resolution for military strikes if there's conclusive proof the Syrian government used chemical weapons. Oct gasoline (RBV13 -0.36%) is down -0.48%. Dec gold (GCZ13 -0.59%) is down -0.63% and Dec copper (HGZ13 -1.56%) is down -1.69%. Agricultural and livestock prices are mixed. The dollar index (DXY00 -0.11%) is down -0.15%. EUR/USD (^EURUSD) is up +0.09% and USD/JPY (^USDJPY) is down -0.10%. December T-note prices (ZNZ13 -0.16%) are down -6.5 ticks.
China's Aug HSBC services PMI rose +1.5 points from July to 52.8, its fastest pace of expansion in 5-months.
Eurozone Q2 GDP was revised slightly higher to +0.3% q/q and -0.5% y/y from the originally reported +0.3% q/q and -0.7% y/y.
Eurozone Aug PMI composite was revised lower to 51.5 from the originally reported 51.7.
Eurozone July retail sales rose +0.1% m/m and fell -1.3% y/y, weaker than expectations of +0.2% m/m and -0.3% y/y, while Jun retail sales were revised lower to -0.7% m/m and -1.1% y/y from the originally reported -0.5% m/m and -0.9% y/y.
UK Aug PMI services unexpectedly rose +0.3 from July to 60.5, stronger than expectations of a -0.5 point decline to 59.7 and the fastest pace of expansion in 6-1/2 years.
The UK Aug BRC Nielsen shop price index all items fell -0.5% y/y, the fourth consecutive month of declines, the most since data for the series began in 2006.

U.S. STOCK PREVIEW

Today’s July U.S. trade deficit report is expected to widen moderately to -$38.7 billion from -$34.2 billion in June. However, even after today’s expected widening of the trade deficit to -$38.7 billion, the deficit will still be much narrower than the -$44.1 billion level seen in May. The Fed today will release its Beige Book report ahead of the FOMC meeting in two weeks on Sep 17-18. The FOMC in its last Beige Book released on July 17 said that the U.S. economy maintained a “modest to moderate pace.” Today’s Aug U.S. total vehicle sales report is expected to edge higher to 15.80 million from 15.73 million in July. There are 5 of the Russell 1000 companies that report earnings today: Navistar (consensus -$1.30), SAIC (0.21), Dollar General (0.74), Greif (0.91), and Forest City Enterprises (-0.02).
Conferences this week include: 16th Annual Asian Shared Services & Outsourcing Week on Tue/Wed, Barclays Capital Back to School Conference on Tue-Wed, Citi Global Technology Conference on Tue-Wed, Barclays CEO Energy Conference on Wed, Barrington Research Growth Conference on Wed, Brean Capital Global Technology Conference on Wed, Pareto Securities Oil & Offshore Conference on Wed, 18th Handelsblatt Annual Conference - Banks in Upheaval on Thu, and Scotiabank Financials Conference 2013 on Thu.

OVERNIGHT U.S. STOCK MOVERS

Prudential (PRU +1.39%) was upgraded to "Overweight" from "Equal Weight" at Barclays who also raised their price target on the stock to $95 from $83.
Best Buy (BBY +2.75%) was upgraded to "Neutral" from "Underperform" at BofA/Merrill.
Loews (L +0.16%) was initiated with a "Buy" at Deutsche Bank with a target of $52.
Dollar General (DG -0.17%) reported Q2 EPS of 77 cents, better than consensus of 74 cents.
SAIC (SAI +0.53%) reported Q2 EPS of 13 cents, well below consensus of 21 cents, and lowered guidance on fscal 2014 EPS view to 95 cents-$1.03, below consensus of $1.13.
ZOLL Medical (ZOLL) was awarded a $210 million government contract for defibrillators, monitors, warmers, and infusers.
Hain Celestial (HAIN +0.12%) fell over 3% in after-hours trading after Carl Icahn filed to sell 3.65 million shares of the company.
Cedar Fair Entertainment (FUN +0.33%) raised its fiscal 2013 revenue estimate to $1.10 billion-$1.25 billion, from $1.09 billion-$1.115 billion.
Glenview Capital reported a 9.1% passive stake in J. C. Penney (JCP +1.92%) .
Consolidated Press International Holdings reported a 9.35% passive stake and Cavalane Holdings reported a 9.35% passive stake in Zillow (Z +2.74%) .
Matrix Service (MTRX +1.80%) reported Q4 EPS of 28 cents, better than consensus of 26 cents.
H&R Block (HRB -0.11%) is down 4% in after-hours trading after it reported a Q1 EPS loss of -40 cents, a wider loss than consensus of -37 cents.
Bank of America (BAC +0.92%) sold its remaining stake in China Construction Bank, approxiamtely 2 billion shares, and said it sees a pretax gain of approximately $750 million from the sale.

MARKET COMMENTS

Sep E-mini S&Ps (ESU13 unch) this morning aredown -0.25 of a point (-0.02%). The S&P 500 index on Tuesday closed higher but fell back from its best levels after Speaker of the House Boehner said he will support President Obama’s call for military action against Syria. Bullish factors included (1) reduced concern of an immediate U.S. attack on Syria after President Obama said he will seek authorization from Congress, which is in recess until Sep 9, before ordering a strike against Syria, and (2) signs of strength in the global economy after the Aug ISM manufacturing index expanded by its fastest pace in 2 years and China’s Aug manufacturing PMI rose to a 16-month high of 51.0. Closes: S&P 500 +0.42%, Dow Jones +0.16%, Nasdaq 100 +0.58%.
Dec 10-year T-notes (ZNZ13 -0.16%) this morning are down -6.5 ticks. Dec 10-year T-note prices on Tuesday closed lower on bearish factors including (1) reduced safe-haven demand as the threat of an immediate U.S. military attack on Syria declined after President Obama said he will seek authorization from Congress before ordering a military strike against Syria, and (2) the Aug ISM manufacturing index that unexpectedly expanded at its fastest pace in 2 years. Closes: TYZ3 -23.00, FVZ3 -11.00.
The dollar index (DXY00 -0.11%) this morning is down -0.121 (-0.15%). EUR/USD (^EURUSD) is up +0.0012 (+0.09%) and USD/JPY (^USDJPY) is down -0.10 (-0.10%). The dollar index on Tuesday climbed to a 6-week high and closed higher after an unexpected increase in the Aug ISM manufacturing index to its best level in 2 years bolstered speculation the Fed will start cutting bond purchases this month. Closes: Dollar index +0.274 (+0.33%), EUR/USD -0.00498 (-0.38%), USD/JPY +1.465 (+1.49%).
Oct WTI crude oil (CLV13 -0.41%) this morning is down -66 cents (-0.61%) and Oct gasoline (RBV13 -0.36%) is down -0.0138 (-0.48%). Oct crude oil and gasoline prices on Tuesday recovered from 1-week lows and settled mixed after Israel launched missiles into the Mediterranean as part of a missile-defense test, which fueled concern about tensions in the Middle East. Another bullish factor was the sign of strength in global manufacturing after Aug manufacturing PMIs rose in China, the U.S. and Europe. Energy prices were undercut by the rise in the dollar index to a 6-week high. Closes: CLV3 +0.89 (+0.83%), RBV3 -0.0300 (-1.04%).

GLOBAL EVENT CALENDAR09/04/2013

US	0700 ET	Weekly MBA mortgage applications, previous -2.5% with purchase sub-index +2.4% and refi sub-index-5.4%.
	0730 ET	Aug Challenger job cuts, July +2.3% y/y.
	0830 ET	July trade balance expected -$38.7 billion, Jun -$34.2 billion.
	1230 ET	San Francisco Fed President John Williams delivers a speech on the economy and monetary policy to community leaders in Portland, OR.
	1400 ET	Fed Beige Book.
	1630 ET	API weekly U.S. oil statistics.
	1700 ET	Aug total vehicle sales expected 15.80 million, July 15.73 million. Aug domestic vehicle sales expected 12.30 million, July 12.20 million.
	2000 ET	Minneapolis Fed President Narayana Kocherlakota participates in a town hall forum at the University of Wisconsin Lacrosse.
GER	0355 ET	Revised German Aug PMI services, pervious 52.4.
EUR	0400 ET	Revised Eurozone Aug PMI composite, previous 51.7.
	0500 ET	Revised Eurozone Q2 GDP, previous +0.3% q/q and -0.7% y/y.
	0500 ET	Eurozone July retail sales expected +0.2% m/m and -0.3% y/y, Jun -0.5% m/m and -0.9% y/y.
UK	0430 ET	UK Aug PMI services expected -0.3 to 59.9, July 60.2.

U.S. STOCK CALENDAR09/04/2013

Company Name	Ticker	Time	Event Description	Period	Estimate
Navistar International Corp	NAV US	Bef-mkt	Q3 2013 Earnings Release	Q3 2013	-1.295
SAIC Inc	SAI US	Bef-mkt	Q2 2014 Earnings Release	Q2 2014	0.212
Dollar General Corp	DG US	Bef-mkt	Q2 2014 Earnings Release	Q2 2014	0.74
SAIC Inc	SAI US	8:00	Q2 2014 Earnings Call	Q2 2014
CR Bard Inc	BCR US	8:30	Business Update Call
Navistar International Corp	NAV US	9:00	Q3 2013 Earnings Call	Q3 2013
Ford Motor Co	F US	10:00	August 2013 Sales and Revenue Call	2013
Biogen Idec Inc	BIIB US	10:00	Biogen Tecfidera EU Scenarios Discussed: Patents, Reimbursement, Compounding
Dollar General Corp	DG US	10:00	Q2 2014 Earnings Call	Q2 2014
Greif Inc	GEF US	Aft-mkt	Q3 2013 Earnings Release	Q3 2013	0.908
Forest City Enterprises Inc	FCE/A US		Q2 2014 Earnings Release	Q2 2014	-0.015
General Motors Co	GM US		August 2013 Sales and Revenue Release	2013