Morning Call 10/4

Barchart Morning Call

Barchart.com - 28 minutes ago

OVERNIGHT MARKETS AND NEWS

Dec E-mini S&Ps (ESZ17 -0.02%) this morning are down -0.09% and European stocks are down -0.56% as weakness in crude oil drags energy stocks lower. Nov WTI crude oil (CLX17 -0.32%) is down -0.32% at a 2-week low after API data late Tuesday showed U.S. gasoline supplies rose +4.91 million bbl, much more than expectations of +1.0 million bbl. European stocks also fell after data showed that Eurozone Aug retail sales unexpectedly fell -0.5% m/m, the biggest decline in 1-3/4 years. Another negative for European markets was the slump in Spain's IBEX Stock Index by -2.56% to a 6-1/2 month low amid the escalating crisis in Spain where the state of Catalonia is trying to secede and form its own independent republic. Asian stocks settled mixed: Japan +0.06%, Hong Kong +0.73%, Australia -0.87%, Singapore -0.29%, India +0.55%. China, Taiwan and South Korea were closed for holidays. Japan's Nikkei Stock Index climbed to a new 2-year high as the rally in the S&P 500 to a fresh record high Tuesday gave a boost to other global bourses.

The dollar index (DXY00 -0.07%) is down -0.27%. EUR/USD (^EURUSD) is up +0.22%. USD/JPY (^USDJPY) is down -0.39%.

Dec 10-year T-note prices (ZNZ17 +0.15%) are up +6.5 ticks.

The UK Sep Markit/CIPS services PMI unexpectedly rose +0.4 to 53.6, stronger than expectations of no change at 53.2.

Eurozone Aug retail sales unexpectedly fell -0.5% m/m, weaker than expectations of +0.3% m/m and the biggest decline in 1-3/4 years.

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) weekly MBA mortgage applications (previous -0.5% with purchase sub-index +2.8% and refi sub-index +3.5%), (2) Sep ADP employment (expected +143,000, Aug +237,000), (3) revised-Sep Markit U.S. services PMI (expected unchanged at 55.1, prelim-Sep -0.9 to 55.1), (4) Sep ISM non-manufacturing PMI (expected +0.2 to 55.5, Aug +1.4 to 55.3), (5) Fed Chair Janet Yellen delivers opening remarks at a community banking conference in St. Louis, (6) EIA weekly Petroleum Status Report.

Notable Russell 1000 earnings reports today include: Acuity Brands (consensus $2.44), RPM Intl (0.84), PepsiCo (1.43), Monsanto (-0.42), Lamb Weston (0.49).

U.S. IPO's scheduled to price today: Rhythm Pharmaceuticals (RYTM).

Equity conferences this week: Deutsche Bank U.S. Leveraged Finance Conference on Mon-Wed, Japan Pack Trade Show on Tue, Linley Processor Conference on Wed, Petaluma Area Chamber of Commerce Business Conference on Fri.

OVERNIGHT U.S. STOCK MOVERS

Kraft Heinz (KHC -0.04%) was downgraded to 'Neutral' from 'Buy' at Goldman Sachs.

Waste Management (WM +0.65%) was downgraded to 'Hold' from 'Buy' at Stifel.

Jack in the Box (JACK -1.24%) was upgraded to 'Outperform' from 'Market Perform' at Telsey Advisory Group with a 12-month target price of $118.

Lennar (LEN +4.79%) was upgraded to 'Buy' from 'Neutral' at MKM Partners with a target price of $64.

Winnebago Industries (WGO -0.54%) was downgraded to 'Hold' from 'Buy' at Stifel.

Tesla (TSLA +1.94%) gained nearly 1% in after-hours trading after Nomura initiated coverage on the stock as a 'Buy' saying there will be an "unprecedented run-up" in Tesla's revenue to $58 billion in 20121 from $8 billion in 2016.

Global Blood Therapeutics (GBT -4.19%) rose 3% in after-hours trading after holder Point72 Asset Management reported a 5.2% stake in the company.

CytomX Therapeutics (CTMX -1.30%) surged over 30% in after-hours trading after it entered into a strategic collaboration with Amgen to co-develop immuno-oncology therapies.

Newlyn Genetics (NLNK +5.00%) slid over 6% in after-hours trading after it announced that it intends to offer up to $50 million shares of its common stock in an underwritten public offering.

Office Depot (ODP +1.32%) tumbled over 10% in after-hours trading after it acquired CompuCom for about $1 billion.

Intelsat SA (I +10.95%) gained 4% in after-hours trading after RBC Capital Markets said the company's joint proposal with Intel for sharing of C-band spectrum in 5G networks was a potential "gold mine."

Rigel Pharmaceuticals (RIGL -4.15%) dropped 7% in after-hours trading after it announced that it intends to offer up to $40 million shares of its common stock in an underwritten public offering.

MARKET COMMENTS

Dec S&P 500 E-mini stock futures (ESZ17 -0.02%) this morning are down -2.25 points (-0.09%). Tuesday's closes: S&P 500 +0.22%, Dow Jones +0.37%, Nasdaq +0.22%. The S&P 500 on Tuesday rose to a new record high and closed higher on strength in airline stocks, led by a 6% jump in Delta Air Lines, after it reported Sep total system traffic was up +0.3%. There was also strength in U.S. automakers after U.S. Sep total vehicle sales surged to 18.47 million units, the most in 12 years.

Dec 10-year T-note prices (ZNZ17 +0.15%) this morning up +6.5 ticks. Tuesday's closes: TYZ7 +2.50, FVZ7 +1.75. Dec 10-year T-notes on Tuesday closed higher on a report from Politico that U.S. Treasury Secretary Mnuchin favors Jerome Powell over Kevin Warsh for Fed chairman, which is supportive for T-notes as Powell as seen as more dovish that Warsh. There was also some short-covering after Dec T-note prices failed to take out Monday's 2-1/2 month low.

The dollar index (DXY00 -0.07%) this morning is .down -0.257 (-0.27%) EUR/USD (^EURUSD) is up +0.0026 (+0.22%) and USD/JPY (^USDJPY) is down -0.44 (-0.39%). Tuesday's closes: Dollar Index -0.288 (-0.31%), EUR/USD +0.0011 (+0.09%), USD/JPY +0.08 (+0.07%). The dollar index on Tuesday closed lower on strength in EUR/USD which recovered from a 1-1/2 month low and moved higher after Eurozone Aug PPI rose +0.3% m/m, the largest increase in 7 months, which bolstered the case for the ECB to taper QE. The dollar was also undercut by the decline in the 10-year T-note yield, which reduces the dollar's interest rate differentials.

Nov crude oil (CLX17 -0.32%) this morning is down -16 cents (-0.32%) at a 2-week low and Nov gasoline (RBX17 -0.45%) is down -0.0053 (-0.34%). Tuesday's closes: Nov WTI crude -0.04 (-0.08%), Nov gasoline +0.0102 (+0.66%). Nov crude oil and gasoline on Tuesday settled mixed. Crude oil prices were supported by a weaker dollar and by expectations for Wednesday's EIA data to show that U.S. crude supplies fell -500,000 bbl last week. Crude closed lower on increased OPEC crude output after OPEC Sep crude production rose +120,000 bpd to 32.38 million bpd.

Metals prices this morning are mixed with Dec gold (GCZ17 +0.30%) +8.0 (+0.63%), Dec silver (SIZ17 +1.02%) +0.19 (+1.14%) and Dec copper (HGZ17 -0.10%) -0.008 (-0.25%). Tuesday's closes: Dec gold -1.2 (-0.09%), Dec silver -0.004(-0.02%), Dec copper +0.008 (+0.27%). Metals on Tuesday settled mixed with Dec gold at a 1-3/4 month low. Metals prices were boosted by a weaker dollar and by the rally in the S&P 500 to a new record high, which bolsters confidence in the economic outlook and industrial metals demand. Gold and silver closed lower after a rally in the S&P 500 to new record high reduced safe-haven demand for precious metals.

GLOBAL EVENT CALENDAR10/04/2017

		Wednesday, Oct 4
US	0700 ET	Weekly MBA mortgage applications, previous -0.5% with purchase sub-index +2.8% and refi sub-index +3.5%.
	0815 ET	Sep ADP employment change expected +143,000, Aug +237,000.
	0945 ET	Revised Sep Markit services PMI expected unchanged at 55.1, prelim-Sep -0.9 to 55.1. Revised Sep Markit composite PMI, prelim-Sep -0.7 to 54.6.
	1000 ET	Sep ISM non-manufacturing PMI expected +0.2 to 55.5, Aug +1.4 to 55.3.
	1030 ET	EIA weekly Petroleum Status Report.
	1515 ET	Fed Chair Janet Yellen delivers opening remarks at a community banking conference in St. Louis.
		Thursday, Oct 5
US	0730 ET	Sep Challenger job cuts, Aug +5.1% y/y.
	0830 ET	Weekly initial unemployment claims expected -7,000 to 265,000, previous +12,000 to 272,000. Weekly continuing claims expected +16,000 to 1.950 million, previous -45,000 to 1.934 million.
	0830 ET	Aug trade balance expected -$42.7 billion, Jul -$43.7 billion.
	0830 ET	USDA weekly Export Sales.
	0910 ET	Fed Governor Jerome Powell speaks on Treasury markets and Treasury market practices at an event in New York.
	0915 ET	San Francisco Fed President John Williams (non-voter) delivers keynote speech at the St. Louis Feds Community Banking in the 21st Century Research and Policy Conference.
	1000 ET	Aug factory orders expected +1.0%, Jul -3.3% and +0.5% ex transportation.
	1000 ET	Philadelphia Fed President Patrick Harker (voter) speaks at the Investing in Americas Workforce conference.
	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 Oct 11-12.
	1630 ET	Kansas City Fed President Esther George (non-voter) speaks at the Investing in Americas Workforce conference.

U.S. STOCK CALENDAR10/04/2017

Name	Ticker	Time	Description	Period	Estimate
RPM International Inc	RPM US	Bef-mkt	Q1 2018 Earnings Release	Q1 18	0.842
Acuity Brands Inc	AYI US	Bef-mkt	Q4 2017 Earnings Release	Q4 17	2.435
PepsiCo Inc	PEP US	06:00	Q3 2017 Earnings Release	Q3 17	1.431
Monsanto Co	MON US	Bef-mkt	Q4 2017 Earnings Release	Q4 17	(0.419)
PepsiCo Inc	PEP US	07:45	Q3 2017 Earnings Call	Q3 17
Boston Properties Inc	BXP US	08:00	Investor Meeting
Lamb Weston Holdings Inc	LW US	08:30	Q1 2018 Earnings Release	Q1 18	0.494
Monsanto Co	MON US	09:30	Q4 2017 Earnings Call	Q4 17
Acuity Brands Inc	AYI US	10:00	Q4 2017 Earnings Call	Q4 17
RPM International Inc	RPM US	10:00	Q1 2018 Earnings Call	Q1 18
Lamb Weston Holdings Inc	LW US	10:00	Q1 2018 Earnings Call	Q1 18
salesforce.com Inc	CRM US	11:30	Investor Meeting
Mallinckrodt PLC	MNK US	12:00	Investor Meeting
Telephone & Data Systems Inc	TDS US		Roadshow - Day 3
United States Cellular Corp	USM US		Roadshow - Day 3
BWX Technologies Inc	BWXT US	13:00	Investor and Analyst Day

Morning Call 9/21

Barchart Morning Call

Barchart.com - 1 hour ago

OVERNIGHT MARKETS AND NEWS

Dec E-mini S&Ps (ESZ17 -0.06%) this morning are down -0.02% with mining stocks leading losses in the overall market as metals prices decline with Dec COMEX gold (GCZ17 -1.51%) down -1.48% to a 3-1/2 week low and Dec COMEX copper (HGZ17 -1.18%) down -0.94% to a 1-month low. Metals prices retreated after the Fed signaled Wednesday afternoon, after metals markets had closed, that it will start trimming its balance sheet next month and projected another interest rate increase for this year. European stocks are up +0.55% at a 2-1/2 month high due to a rally in bank stocks and insurance companies on rising bond yields as the 10-year German bund climbed to a 1-1/2 month high of 0.484%. Asian stocks settled mostly lower: Japan +0.18%, Hong Kong -0.06%, China -0.24%, Taiwan +0.56%, Australia -0.94%, Singapore -0.13%, South Korea -0.07%, India -0.09%. Chinese stocks fell back after S&P Global Ratings cut China's sovereign credit rating by one step to A+ from AA-, citing the risks from soaring debt. Japan's Nikkei Stock Index rallied to a new 2-year high after the BOJ kept its benchmark interest rate at a record low and maintained its QE program. The divergence in monetary policies between the Fed and BOJ also weakened the yen, which boosted Japanese exporter stocks as USD/JPY climbed to a 2-month high.

The dollar index (DXY00 +0.03%) is down -0.06%. EUR/USD (^EURUSD) is up +0.08%. USD/JPY (^USDJPY) is up +0.29% to a 2-month high.

Dec 10-year T-note prices (ZNZ17 +0.01%) are up +1 tick.

As expected, the BOJ kept its benchmark interest rate at -0.1% and said it will maintain its purchases of government bonds to keep the 10-year bond yield at about zero percent.

S&P Global Ratings cut China's sovereign credit rating by one step to A+ from AA-, the first cut since 1999, saying "China's prolonged period of strong credit growth has increased its economic and financial risks."

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) weekly initial unemployment claims (expected +16,000 to 300,000, previous -14,000 to 284,000) and continuing claims (expected +31,000 to 1.975 million, previous -7,000 to 1.944 million), (2) Sep Philadelphia Fed business outlook index (expected -1.7 to 17.2, Aug -0.6 to 18.9), (3) Jul FHFA house price index (expected +0.4% m/m, Jun +0.1% m/m), (4) Aug leading indicators (expected +0.3%, Jul +0.3%), (5) Treasury auctions $11 billion of 10-year TIPS, (6) USDA weekly Export Sales.

Notable Russell 1000 earnings reports today include: none.

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

Equity conferences this week: Electronic Design Process Symposium on Thu.

OVERNIGHT U.S. STOCK MOVERS

PRA Group (PRAA +0.17%) was downgraded to 'Underperform' from 'Market Perform' at Raymond James.

Netflix (NFLX -0.09%) was initiated with a 'Buy' at Buckingham Research Group with a 12-month target price of $214.

Anadarko Petroleum (APC +2.40%) jumped over 4% in after-hours trading after its board authorized a $2.5 billion share repurchase program through the end of 2018.

Nvidia (NVDA -0.81%) slid 2% in after-hours trading after CNBC reported that AMD is working with Tesla on a chip for autonomous driving. Nvidia currently supplies Tesla with graphics processing units.

Advanced Micro Devices (AMD +4.73%) climbed 4% in after-hours trading after it said it was working with Tesla on an AI self-drive chip.

Herman Miller (MLHR unch) lost nearly 2% in after-hours trading after the CEO said the company faces "some challenges resulting from the recent storms in Texas and the South East."

Global Blood Therapeutics (GBT +0.35%) rose 3% in after-hours trading after Needham initiated coverage on the stock with a 'Buy' and a price target of $59.

Juno Therapeutics (JUNO +3.22%) fell over 4% in after-hours trading after it announced a $225 million secondary offering of its common stock.

Amphastar Pharmaceuticals (AMPH -0.13%) gained almost 3% in after-hours trading after the company received approval from the FDA for its sodium bicarbonate injection prefilled syringe system.

GSE Systems (GVP +1.82%) rose 2% in after-hours trading after it purchased Absolute Consulting for $8.75 million in cash.

Blue Apron Holdings (APRN -5.26%) gained 3% in after-hours trading on take-over speculation after Albertsons agreed to purchase Plated, another meal-kit service.

VEON Ltd (VEON -0.71%) dropped 4% in after-hours trading after it announced that Telenor East Holding II is offering for sale 90 million shares of VEON.

MARKET COMMENTS

Dec S&P 500 E-mini stock futures (ESZ17 -0.06%) this morning are down -0.50 points (-0.02%). Wednesday's closes: S&P 500 +0.06%, Dow Jones +0.19%, Nasdaq -0.29%. The S&P 500 on Wednesday rose to a new record high and settled higher on the FOMC's confidence in the economy as displayed by its willingness to issue a hawkish interest rate forecast and also raise its 2017 GDP estimate to +2.4% from 2.2%. There was also strength in energy stocks as crude oil prices rose +1.58% to a 3-3/4 month high. Stocks were undercut by the weaker-than-expected U.S. Aug existing home sales report of -1.7% to a 1-year low of 5.35 million (vs expectations of +0.2% to 5.45 million) and the jump in the 10-year T-note yield to a 1-1/2 month high after the FOMC maintained its projection for one more 25 bp rate hike this year and three more next year.

Dec 10-year T-note prices (ZNZ17 +0.01%) this morning are up +1 tick. Wednesday's closes: TYZ7 -11.50, FVZ7 -8.00. Dec 10-year T-notes on Wednesday fell to a 1-1/2 month low and closed lower on the FOMC's projections for one more 25 bp rate hike this year and three more next year and the FOMC's hike in its U.S. 2017 GDP estimate to 2.4% from 2.2%.

The dollar index (DXY00 +0.03%) this morning is down -0.058 (-0.06%). EUR/USD (^EURUSD) is up +0.0010 (+0.08%) and USD/JPY (^USDJPY) is up +0.32 (+0.29%) at a 2-month high. Wednesday's closes: Dollar Index +0.715 (+0.78), EUR/USD -0.0102 (-0.85%), USD/JPY +0.63 (+0.56%). The dollar index on Wednesday rallied to a 2-week high and closed higher on the FOMC's hike in its 2017 U.S. GDP estimate to 2.4% from 2.2% and the FOMC's projections for one more 25 bp rate hike this year and three more rate hikes next year.

Nov crude oil (CLX17 -1.01%) this morning is down -29 cents (-0.57%) and Nov gasoline (RBX17 -0.72%) is -0.0079(-0.49%). Wednesday's closes: Nov WTI crude +0.79 (+1.58%), Nov gasoline +0.0099 (+0.62%). Nov crude oil and gasoline on Wednesday closed higher on the -2.13 million bbl decline in EIA gasoline inventories to a 1-3/4 year low and the -5.693 bbl fall in EIA distillate stockpiles to a 2-year low, more than expectations of -1.95 million bbl.

Metals prices this morning are weaker with Dec gold (GCZ17 -1.51%) -19.5 (-1.48%) at a 3-1/2 week low, Dec silver (SIZ17-1.90%) -0.349 (-2.01%) at a 3-1/2 week low and Dec copper (HGZ17 -1.18%) -0.028 (-0.94% at a 1-month low. Wednesday's closes: Dec gold +5.8 (+0.44%), Dec silver +0.055 (+0.32%), Dec copper -0.0005 (-0.02%). Metals on Wednesday settled mixed. Metals were supported by early weakness in the dollar and by short-covering ahead of the outcome of Wednesday's 2-day FOMC meeting, which happened after the close of metals trading. Copper closed lower after U.S. Aug existing home sales unexpectedly fell -1.7% to a 1-year low of 5.35 million, a sign of weaker copper demand.

GLOBAL EVENT CALENDAR09/21/2017

		Thursday, Sep 21
US	0830 ET	Weekly initial unemployment claims expected +16,000 to 300,000, previous -14,000 to 284,000. Weekly continuing claims expected +31,000 to 1.975 million, previous -7,000 to 1.944 million.
	0830 ET	Sep Philadelphia Fed business outlook index expected -1.7 to 17.2, Aug -0.6 to 18.9.
	0830 ET	USDA weekly Export Sales.
	0900 ET	Jul FHFA house price index expected +0.4% m/m, Jun +0.1% m/m.
	1000 ET	Aug leading indicators expected +0.3%, Jul +0.3%.
	1100 ET	Treasury announces amount of 2-year T-notes (previous $26 billion), 2-year floating-rate notes (previous $13 billion), 5-year T-notes (previous $34 billion) and 7-year T-notes (previous $28 billion) to be auctioned Sep 26-28.
	1300 ET	Treasury auctions $11 billion 10-year TIPS.
		Friday, Sep 22
US	0600 ET	San Francisco Fed President John Williams (non-voter) speaks to media prior to taking part in a closed academic conference at the Swiss National Bank in Zurich.
	0930 ET	Kansas City Fed President Esther George delivers opening keynote speech at a conference on global oil supply and demand hosted jointly by the Kansas City and Dallas Fed titled Global Oil Supply & Demand; Prospects for Greater Balance.
	0945 ET	Preliminary-Sep Markit U.S. manufacturing PMI expected +0.2 to 53.0, Aug -0.5 to 52.8. Sep Markit U.S. services PMI expected -0.2 to 55.8, Aug +1.3 to 56.0.
	1330 ET	Dallas Fed President Robert Kaplan speaks in a moderated Q&A at a conference on global oil supply and demand hosted jointly by the Kansas City and Dallas Fed.
	1500 ET	USDA Aug Cold Storage.
	1500 ET	USDA Aug Cattle on Feed.

U.S. STOCK CALENDAR09/21/2017

Name	Ticker	Time	Description	Period	Estimate
Darden Restaurants Inc	DRI US		Annual General Meeting
NIKE Inc	NKE US	13:00	Annual General Meeting