MORNING CALL 4/6

Barchart Morning Call

Barchart.com - 55 minutes ago

OVERNIGHT MARKETS AND NEWS

Jun E-mini S&Ps (ESM17 +0.11%) this morning are up +0.13% as they recovered from a 1-week low in overnight trade. Concern by FOMC members over high stock prices led to a sell-off Wednesday afternoon that extended into overnight trading after the Mar 14-15 FOMC meeting minutes said, "some participants viewed equity prices as quite high relative to standard valuation measures." Stocks recovered, though, on short-covering ahead of a 2-day meeting that begins today between President Trump and Chinese President Xi Jinping in Florida. European stocks are up +0.10% after comments from ECB President Draghi signaled the ECB will continue with its QE program when he said that "a reassessment of the current monetary policy stance is not warranted at this stage." Asian stocks settled mostly lower: Japan -1.40%, Hong Kong -0.52%, China +0.33%, Taiwan -0.52%, Australia -0.34%, Singapore -0.03%, South Korea -0.45%, India -0.16%. China's Shanghai Composite bucked the sell-off in global stock markets and rallied to a 4-month high on optimism that talks between Chinese President Xi Jinping and U.S. President Trump will improve U.S.-China trade relations. Japan's Nikkei Stock Index followed the late sell-off in U.S. stocks Wednesday and fell to a 3-3/4 month low.

The dollar index (DXY00 +0.01%) is up +0.04%. EUR/USD (^EURUSD) is up +0.04%. USD/JPY (^USDJPY) is up +0.14%.

Jun 10-year T-note prices (ZNM17 unch) are little changed, down -0.5 of a tick.

ECB President Draghi said, "we have not yet seen sufficient evidence to materially alter our assessment of the inflation outlook" and that "a reassessment of the current monetary policy stance is not warranted at this stage."

San Francisco Fed President Williams (non-voter) said two more rate hikes this year is a sensible starting point and that it makes sense for the Fed to start shrinking its balance sheet toward the end of this year. He added that it will take something like 5-years to bring the balance sheet down to a more normal level, just based on the arithmetic of its holdings.

German Feb factory orders rose +3.4% m/m, weaker than expectations of +4.0% m/m.

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) Mar Challenger job cuts (Feb -40.0% y/y), (2) weekly initial unemployment claims (expected -8,000 to 250,000, previous -3,000 to 258,000), (3) weekly continuing claims (expected -22,000 to 2.030 million, previous +65,000 to 2.052 million), (4) San Francisco Fed President John Williams (non-voter) speaks on a ECB panel in Frankfurt on “Do monetary policy frameworks need to be adjusted in a world of (potentially) low natural interest rates? If so, how?” (5) President Trump and Chinese President Xi Jinping hold talks on Thu-Fri at Mar-a-Lago, Florida.

Notable Russell 1000 earnings reports today include: Constellation Brands (consensus $1.36), RPM Intl (0.11), MSC Industrial Direct (0.90), CarMax (0.79), Lamb Weston (0.54).

U.S. IPO's scheduled to price today:

Equity conferences: Jefferies Animal Health Summit on Thu.

OVERNIGHT U.S. STOCK MOVERS

Medtronic PLC (MDT -0.47%) gained almost 2% in after-hours trading after Reuters reported that it was close to selling its medical supplies unit to Cardinal Health for $6 billion.

Jazz Pharmaceuticals PLC (JAZZ -1.79%) climbed over 4% in after-hours trading after it settled a lawsuit with Hikma that grants Hikma the right to sell an authorized generic version of Xyrem in the U.S. starting January 1, 2023.

Yum China Holdings (YUMC +0.79%) rallied nearly 10% in after-hours trading after it reported Q1 comparable sales unexpectedly rose 1%, better than consensus of -2.4%, and reported Q1 revenue of $1.28 billion, higher than consensus of $1.27 billion.

TD Ameritrade (AMTD -2.06%) was upgraded to 'Buy' from 'Neutral' at Buckingham Research Group with a 12-month target price of $48.

Cardinal Health (CAH +0.14%) was upgraded to 'Outperform' from 'Inline' at Evercore ISI with a 12-month target price of $91.50.

Teladoc (TDOC +1.41%) was downgraded to 'Neutral' from 'Overweight' at Cantor Fitzgerald with a 12-month target price of $27.

OZ Minerals (OZMLF -8.26%) was downgraded to 'Sell' from 'Hold' at Morningstar.

Bed Bath & Beyond (BBBY -3.03%) rose nearly 3% in after-hours trading after it reported Q4 EPS of $1.84, above consensus of $1.77.

Resources Connection (RECN -1.53%) dropped 9% in after-hours trading after it reported Q3 EPS of 9 cents, below consensus of 14 cents.

8Point3 Energy Partners LP (CAFD +0.92%) tumbled 14% in after-hours trading after it said it sees Q2 revenue of $14 million to $16 million, weaker than consensus of $16.2 million.

GoPro (GPRO unch) fell over 1% in after-hours trading after it offered $150 million of convertible senior notes due 2022 in a private placement.

Colony Northstar (CLNS -0.53%) lost nearly 2% in after-hours trading after a person familiar with the matter said a 21.9 million share block of Northstar shares were being offered at $12.65 to $12.70 via Morgan Stanley.

Synacor (SYNC +1.22%) slumped 6% in after-hours trading after it announced a proposed public offering of common stock, although no size was given.

MARKET COMMENTS

Jun E-mini S&Ps (ESM17 +0.11%) this morning are up +3.00 points (+0.13%). Wednesday's closes: S&P 500 -0.31%, Dow Jones -0.20%, Nasdaq -0.40%. The S&P 500 on Wednesday rallied to a 2-week high but shed its gains and closed lower. Negative factors include the -2.4 point decline in the U.S. Mar ISM non-manufacturing index to a 5-month low of 55.2, House Speaker Ryan's comment that tax reform could take longer than a health care overhaul, and the Mar 14-15 FOMC meeting minutes where some policy makers said that stock prices were "quite high" and where the FOMC said it would start reducing its balance sheet "later this year." Stocks found early support on the Mar ADP employment report of +263,000, stronger than expectations of +185,000 and the most in 2-1/4 years.

Jun 10-year T-notes (ZNM17 unch) this morning are down -0.5 of a tick. Wednesday's closes: TYM7 +0.50, FVM7 +1.50. Jun 10-year T-notes on Wednesday closed slightly higher on weakness in stocks and the U.S. Mar ISM non-manufacturing index report of -2.4 points to a 5-month low of 55.2. T-notes were undercut by the stronger-than-expected U.S. Mar ADP employment report and by the minutes from the Mar 14-15 FOMC meeting where policy makers said they would begin shrinking the Fed's balance sheet later this year.

The dollar index (DXY00 +0.01%) this morning is up +0.04 (+0.04%). EUR/USD (^EURUSD) is up +0.0004 (+0.04%) and USD/JPY (^USDJPY) is up +0.16 (+0.14%). Wednesday's closes: Dollar index +0.02 (+0.02%), EUR/USD -0.0011 (-0.10%), USD/JPY -0.04 (-0.04%). The dollar index on Wednesday rose to a 3-week high and settled higher. The dollar was boosted by the stronger-than-expected U.S. Mar ADP employment report (+263,000) and the Mar 14-15 FOMC minutes where the Fed it would likely start reducing its balance sheet later in the year.

May WTI crude oil prices (CLK17 +0.57%) this morning are up +11 cents (+0.22%) and May gasoline (RBK17 +0.26%) is -0.0003 (-0.02%). Wednesday's closes: May crude +0.12 (+0.24%), May gasoline -0.0064 (-0.37%). May crude oil and gasoline on Wednesday settled mixed with May crude at a 4-week high. Crude oil was boosted by optimism that OPEC will extend its production cuts past June. Crude oil prices were undercut by the unexpected +1.57 million bbl increase in EIA crude inventories to a record 535.5 million bbl (vs expectations of -150,000 bbl), the +1.41 million bbl increase in crude supplies at Cushing, OK, delivery point of WTI futures, to a record 69.144 million bbl, and the +0.6% increase in U.S. crude production the week ended Mar 31 to a 14-month high of 9.199 million bpd.

GLOBAL EVENT CALENDAR04/06/2017

		Thursday, April 6
US	n/a	President Trump and Chinese President Xi Jinping hold talks on Thu-Fri at Mar-a-Lago, Florida.
	0700 ET	Mar Challenger job cuts, Feb -40.0% y/y.
	0830 ET	Weekly initial unemployment claims expected -8,000 to 250,000, previous -3,000 to 258,000. Weekly continuing claims expected -22,000 to 2.030 million, previous +65,000 to 2.052 million.
	0830 ET	USDA weekly Export Sales.
	0930 ET	San Francisco Fed President John Williams (non-voter) speaks on a ECB panel in Frankfurt on Do monetary policy frameworks need to be adjusted in a world of (potentially) low natural interest rates? If so, how?
	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 Apr 10-12.
		Friday, April 7
US	n/a	President Trump and Chinese President Xi Jinping hold talks on Thu-Fri at Mar-a-Lago, Florida.
	0700 ET	Mar Challenger job cuts, Feb -40.0% y/y.
	0830 ET	Weekly initial unemployment claims expected -8,000 to 250,000, previous -3,000 to 258,000. Weekly continuing claims expected -22,000 to 2.030 million, previous +65,000 to 2.052 million.
	0830 ET	USDA weekly Export Sales.
	0930 ET	San Francisco Fed President John Williams (non-voter) speaks on a ECB panel in Frankfurt on Do monetary policy frameworks need to be adjusted in a world of (potentially) low natural interest rates? If so, how?
	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 Apr 10-12.

U.S. STOCK CALENDAR04/06/2017

Company	Ticker	Time	Event Description	Period	Estimate
Constellation Brands Inc	STZ US	Bef-mkt	Q4 2017 Earnings Release	Q4 17	1.364
RPM International Inc	RPM US	Bef-mkt	Q3 2017 Earnings Release	Q3 17	0.109
MSC Industrial Direct Co Inc	MSM US	Bef-mkt	Q2 2017 Earnings Release	Q2 17	0.897
CarMax Inc	KMX US	07:00	Q4 2017 Earnings Release	Q4 17	0.786
Lamb Weston Holdings Inc	LW US	08:30	Q3 2017 Earnings Release	Q3 17	0.535
MSC Industrial Direct Co Inc	MSM US	08:30	Q2 2017 Earnings Call	Q2 17
CarMax Inc	KMX US	09:00	Q4 2017 Earnings Call	Q4 17
Comcast Corp	CMCSA US	09:00	Analyst Day
RPM International Inc	RPM US	10:00	Q3 2017 Earnings Call	Q3 17
Lamb Weston Holdings Inc	LW US	10:00	Q3 2017 Earnings Call	Q3 17
Constellation Brands Inc	STZ US	10:30	Q4 2017 Earnings Call	Q4 17
Synopsys Inc	SNPS US	11:00	Annual General Meeting
Quintiles IMS Holdings Inc	Q US		Annual General Meeting

MORNING CALL 1/7

MORNING CALL

Thursday, January 7th, 2016View Older Reports

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OVERNIGHT MARKETS AND NEWS

March E-mini S&Ps (ESH16 -2.17%) are down sharply by -2.24% at a 3-month low and European stocks are down -3.10% at a 3-1/4 month low after China's stock exchanges closed less than half an hour after opening when they fell 7% and triggered a halt to trading for the second time this week. Chinese stocks tumbled as the PBOC cut its reference rate for the yuan for an eighth straight day, which sent the yuan plunging to a 4-3/4 year low against the dollar as China is attempting to spur economic growth through a weaker yuan. Freeport-McMoRan and Alcoa are both down more than 4% in pre-market trading as the price of copper (HGH16 -2.83%) dropped -3.04% to a 1-1/2 month low, and energy producers are lower as the price of crude oil (CLG16 -3.62%) plummeted -3.15% to a 12-year low. Another negative for stocks was the action by the World Bank to lower its 2016 global growth estimate to 2.9% from a 3.3% estimate in Jun. Asian stocks settled sharply lower: Japan -2.33%, Hong Kong -3.09%, China -7.04%, Taiwan-1.73%, Australia -2.20%, Singapore -2.65%, South Korea -1.14%, India -2.18%.

The dollar index (DXY00 -0.39%) is down -0.47%. EUR/USD (^EURUSD) is up +0.69%. USD/JPY (^USDJPY) is down -0.86% to a 4-1/2 month low.

Mar T-note prices (ZNH16 +0.21%) are up +9.5 ticks at a 2-month high on a flight-to-safety with the plunge in global equity markets.

The PBOC reported that China's foreign exchange reserves shrank by a record $108 billion in Dec, which cut its total foreign-exchange reserves to a 3-year low of $3.33 trillion as the PBOC has burnt through its reserves in an attempt to prop up the yuan.

The World Bank cut its 2016 global growth estimate to 2.9% from a 3.3% estimate in Jun, citing a weaker outlook for the U.S., China, Japan and Russia. The World Bank also cut its 2016 China growth outlook to 6.7% from a 7.0% estimate in Jun.

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) Dec challenger job cuts (Nov -13.9% y/y), (2) weekly initial unemployment claims (expected -12,000 to 275,000, previous +20,000 to 287,000) and continuing claims (expected +2,000 to 2.200 million, previous +3,000 to 2.198 million), (3) Richmond Fed President Jeffrey Lacker's speech on the 2016 economic outlook at an event hosted by the Great Raleigh Chamber of Commerce, (4) Chicago Fed President Charles Evans' speech on the economic outlook and monetary policy at the Wisconsin Economic Forecast Luncheon.

There are 3 of the Russell 3000 companies that report earnings today: Walgreens Boots Alliance (consensus $0.96), Constellation Brands (1.30), Bed Bath & Beyond (1.09).

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

Equity conferences this week: Citi Global Internet, Media & Telecommunications Conference on Wed-Thu.

OVERNIGHT U.S. STOCK MOVERS

Freeport-McMoRan (FCX -8.05%) and Alcoa (AA -7.12%) are both down more than 4% in pre-market trading as the price of copper dropped -3.04% to a 1-1/2 month low.

Capital One Financial (COF -1.31%) was downgraded to 'Hold' from 'Buy' at Deutsche Bank.

Walgreens Boots Alliance (WBA -1.53%) reported Q1 EPS of $1.03, better than consensus of 96 cents.

Agilent Technologies (A +0.44%) was upgraded to 'Outperform' from 'Market Perform' at Cowen with a price target of $46.

Macy's (M -2.19%) climbed over 2% in after-hours trading after it initially sold-off 5% when it lowered guidance on Q4 EPS to $2.18-$2.23 from a previous estimate of $2.54-$2.64, and then said it will reduce costs by $400 million by closing 36 stores and cutting up to 4,800 jobs in early 2016.

NetApp (NTAP -2.80%) reported that CFO Nick Noviello is leaving the firm to pursue another opportunity and named VP of corporate finance, Jeffrey Bergmann, as interim CFO.

Paycom Software (PAYC +0.34%) was rated a new 'Outperform' at Robert Baird with a 12-month price target of $48.

Resource Connection (RECN -3.45%) fell over 3% in after-hours trading after it reported Q2 EPS of 23 cents, below consensus of 24 cents.

Zumiez (ZUMZ -1.50%) jumped over 10% in after-hours trading after it raised guidance on Q4 EPS to 45 cents-47 cents from a previous estimate of 40 cents-46 cents, above consensus of 43 cents.

Mistras Group (MG -1.74%) surged over 12% in after-hours trading after it reported Q2 EPS of 39 cents, well above consensus of 26 cents.

Globus Medical (GMED +1.92%) slipped over 2% in after-hours trading after it forecast 2016 sales of $583 million, below consensus of $590.4 million.

Clear Channel Outdoor Holdings (CCO +5.56%) climbed over 2% in after-hours trading after Lamar Advertising said it was near an agreement to acquire billboard assets valued at about $450 million from CCO.

MARKET COMMENTS

Mar E-mini S&Ps (ESH16 -2.17%) this morning are down sharply by -44.50 points (-2.24%) to a 3-month low. Wednesday's closes: S&P 500 -1.31%, Dow Jones -1.47%, Nasdaq -0.90%. The S&P 500 on Wednesday dropped to a 3-month low and closed lower on the PBOC's cut in its daily reference rate for the yuan for the seventh day in a row, which stoked Chinese economic concerns that undercut global stocks and pushed the yuan down to a 4-3/4 year low against the dollar. Stocks were also undercut by the unexpected -0.6 point decline in the Dec ISM U.S. non-manufacturing index to 55.3, weaker than expectations of +0.1 to 56.0 and the slowest pace of expansion in 20 months. On the positive side, the Dec ADP employment change rose +257,000, stronger than expectations of +198,000 and the biggest increase in a year.

Mar 10-year T-notes (ZNH16 +0.21%) this morning are up +9.5 ticks to a 2-month high. Wednesday's closes: TYH6 +19.50, FVH6 +12.25. Mar T-notes on Wednesday climbed to a 3-week high and settled higher on increased safe-haven demand with the plunge in global equity markets and on the slide in energy prices, which undercut inflation expectations as the 10-year T-note breakeven inflation rate fell to a 1-week low.

The dollar index (DXY00 -0.39%) this morning is down -0.471 (-0.47%). EUR/USD (^EURUSD) up +0.0074 (+0.69%). USD/JPY (^USDJPY) is down-1.02 (-0.86%) to a 4-1/2 month low. Wednesday's closes: Dollar Index -0.223 (-0.22%), EUR/USD +0.0033 (+0.31%), USD/JPY -0.59 (-0.50%). The dollar index on Wednesday closed lower on (1) the fall in USD/JPY to a 2-1/2 month low after the plunge in global equity markets boosted the safe-haven demand for the yen, and (2) speculation that this week's sell-off in global equity markets may prompt the Fed to delay the next interest rate increase.

Feb crude oil (CLG16 -3.62%) this morning is down -$1.07 a barrel (-3.15%) to a 12-year low and Feb gasoline (RBG16 -1.39%) is down -0.0118(-1.02%) to a fresh 6-3/4 year low. Wednesday's closes: CLG6 -1.91 (-5.31%), RBG6 -0.0932 (-7.42%). Feb crude and gasoline on Tuesday closed sharply lower as Feb crude and Feb gasoline posted 6-3/4 year nearest-futures lows. Crude oil prices were hurt by the +917,000 bbl increase in crude supplies at Cushing to a record high 63.91 million bbl and by the +10.58 million bbl surge in weekly EIA gasoline inventories to a 9-1/2 month high. On the positive side, EIA crude supplies unexpectedly fell -5.09 million bbl versus expectations of +1.0 million bbl.

GLOBAL EVENT CALENDAR01/07/2016

US	0730 ET	Dec challenger job cuts, Nov -13.9% y/y.
	0830 ET	Weekly initial unemployment claims expected -12,000 to 275,000, previous +20,000 to 287,000. Weekly continuing claims expected +2,000 to 2.200 million, previous +3,000 to 2.198 million.
	0830 ET	USDA weekly Export Sales.
	0845 ET	Richmond Fed President Jeffrey Lacker speaks on the 2016 economic outlook at an event hosted by the Great Raleigh Chamber of Commerce.
	1100 ET	Treasury announce amount of 3-year T-notes (previous $24 billion), 10-year T-notes (previous $21 billion) and 30-year T-bonds (previous $13 billion) to be auctioned Jan 12-14.
	1415 ET	Chicago Fed President Charles Evans speaks on the economic outlook and monetary policy at the Wisconsin Economic Forecast Luncheon.
GER	0200 ET	German Nov factory orders expected +0.1% m/m and +1.1% y/y, Oct +1.8% m/m and -1.4% y/y.
	0200 ET	German Nov retail sales expected +0.5% m/m and +3.7% y/y, Oct -0.1% m/m and +2.1% y/y.
	0300 ET	German Dec Markit construction PMI, Nov 52.5.
UK	0400 ET	UK Dec new car registrations, Nov +3.8% y/y.
EUR	0500 ET	Eurozone Dec economic confidence expected -0.1 to 106.0, Nov 106.1. Dec business climate indicator expected +0.03 to 0.39, Nov 0.36.
	0500 ET	Revised Eurozone Dec consumer confidence, preliminary +0.2 to 5.7.
	0500 ET	Eurozone Nov retail sales expected +0.2% m/m and +2.0% y/y, Oct -0.1% m/m and +2.5% y/y.
	0500 ET	Eurozone Nov unemployment rate expected unch at 10.7%.
JPN	2030 ET	Japan Nov labor cash earnings expected +0.7% y/y, Oct +0.7% y/y. Nov real cash earnings, Oct +0.4% y/y.

U.S. STOCK CALENDAR01/07/2016

Company	Ticker	Time	Event Description	Period	Estimate
Walgreens Boots Alliance Inc	WBA US	7:00	Q1 2016 Earnings Release	Q1 2016	0.957
Signet Jewelers Ltd	SIG US	7:00	December 2015 Sales and Revenue Release	2015
L Brands Inc	LB US	7:30	December 2015 Sales and Revenue Call	2015
Constellation Brands Inc	STZ US	7:30	Q3 2016 Earnings Release	Q3 2016	1.297
Walgreens Boots Alliance Inc	WBA US	8:30	Q1 2016 Earnings Call	Q1 2016
Signet Jewelers Ltd	SIG US	8:30	December 2015 Sales and Revenue Call	2015
Constellation Brands Inc	STZ US	10:30	Q3 2016 Earnings Call	Q3 2016
Bed Bath & Beyond Inc	BBBY US	16:15	Q3 2016 Earnings Release	Q3 2016	1.091
Bed Bath & Beyond Inc	BBBY US	17:00	Q3 2016 Earnings Call	Q3 2016
Gap Inc/The	GPS US		December 2015 Sales and Revenue Release	2015
L Brands Inc	LB US		December 2015 Sales and Revenue Release	2015
Mylan NV	MYL US		Special Meeting
Ameren Corp	AEE US		Investor Meeting	Y 2016
Compass Minerals International Inc	CMP US		Q4 2015 Sales and Revenue Release	Q4 2015

The 5 Best Small Caps

Today I used Barchart to sort the S&P 600 Small Cap Index stocks for the best technical buy signals, then used the Flipchart feature to find the charts I liked.

Today's list includes Universal Forest Products (UFPI), Texas Roadhouse (TXRH), Resources Connections (RECN), Neogen (NEOG) and Monolithic Power Systems (MPWR):

Universal Forest Products (UFPI)

Barchart technical indicators:

• 100% Barchart technical buy signals
• Trend Spotter buy signal
• Above its 20, 50 and 100 day moving averages
• 7 new highs and up 8.71% in the last month
• Relative Strength Index 51.63%
• Barchart computes a technical support level at 51.63
• Recently traded at 54.14 with a 50 day moving average of 51.56

Texas Roadhouse (TXRH)

Barchart technical indicators:

• 100% Barchart technical buy signals
• Trend Spotter buy signal
• Above its 20, 50 and 100 day moving averages
• 8 new highs and up 9.98% in the last month
• Relative Strength Index 71.38%
• Barchart computes a technical support level at 36.00
• Recently traded at 37.57 with  50 day moving average of 34.15

Resources Connections (RECN)

Barchart technical indicators:

• 100% Barchart technical buy signals
• Trend Spotter buy signal
• Above its 20, 50 and 100 day moving averages
• 8 new highs and up 5.57% in the last month
• Relative Strength Index 68.83%
• Barchart computes a technical support level at 17.34
• Recently traded at 18.15 with a 50 day moving average of 48.18

Neogen (NEOG)

Barchart technical indicators:

• 100% Barchart technical buy signals
• Trend Spotter buy signal
• Above its 20, 50 and 100 day moving averages
• 4 new highs and up 4.00% in the last month
• Relative Strength Index 64.13%
• Barchart computes a technical support level at 48.16
• Recently traded at 50.18 with a 50 day moving average of 48.18

Monolithic Power Systems (MPWR)

Barchart technical indicators:

• 100% Barchart technical buy signals
• Trend Spotter buy signal
• Above its 20, 50 and 100 day moving averages
• 10 new highs and up 9.38% in the last month
• Relative Strength Index 70.81%
• Barchart computes a technical support level at 51.25
• Recently traded at 52.52 with a 50 day moving average of 48.58

Barchart Morning Call 3/28

Barchart Morning Call

Barchart.com - 42 mins ago

Overnight Developments

• Global stocks this morning are mixed with the Euro Stoxx 50 down -0.21% and Jun S&Ps up +2.80 points. The dollar and Treasuries are little changed, while commodities and European stocks weakened after the French and British economies grew less than expected last quarter. Q4 French GDP was revised down to +1.3% annualized from +1.4% y/y and Q4 U.K. GDP was revised down to -0.3% q/q and +0.5% y/y, weaker than the previously reported -0.2% q/q and +0.7% y/y. European and U.S. stocks were also pressured after a transcript of an interview with ABC News anchor Diane Sawyer revealed that Fed Chairman Bernanke said the U.S. recovery isn't assured and "it's far too early to declare victory." The euro rose against the dollar after Italian Prime Minister Monti said during a visit to Tokyo that the Euro-Zone's debt woes are "almost over" after a slow initial response by policy makers. Natural gas prices posted another fresh 10-year nearest-futures low in overnight trade and metals prices weakened after Goldman Sachs Group cut its 3-month outlook on commodities to neutral from overweight.
• Asian stocks today closed mostly lower with Japan down -0.71%, China -2.84%, Australia +0.98%, South Korea -0.40%, India -0.79%. Asian stocks fell after Chinese companies reported slumping profits and Societe Generale said consensus earnings expectations for some Chinese companies are "far too optimistic." China's Shanghai Stock Index tumbled to a 1-1/2 month low led by a 21% plunge in Gome Electrical Appliances Holdings Ltd. after China's second-largest electronics retailer said net income last year dropped to 1.84 billion yuan, weaker than analysts' estimates of 2.42 billion yuan. Chinese metal producers also fell as Jiangxi Copper, China's biggest copper producer by market value, fell 2.4% after it reported an 18% fall in profit and Angang Steel dropped 2.2% after reporting a wider-than-expected loss.

Overnight U.S. Stock News

• June S&Ps this morning are trading up +2.80 points. The U.S. stock market Tuesday fell back from an early rally and settled lower as profit-taking set in after the S&P 500 and the Nasdaq posted new yearly highs: Dow Jones -0.33%, S&P 500 -0.28%, Nasdaq Composite -0.07%. The S&P 500 posted a 3-3/4 year high, the Dow climbed to a 1-week high and the Nasdaq rallied up to an 11-year high, but they all gave up their gains and closed lower. Bearish factors Tuesday included (1) the larger-than-expected decline in the Mar Richmond Fed manufacturing index to its weakest level in 4 months (-13 to 7 versus expectations of -2 to 18), (2) concern over contagion of the European sovereign-debt crisis to Portugal after Fitch Ratings said Portuguese banks remain on "shaky ground," and (3) late afternoon comments from Fed Chairman Bernanke that prompted profit-taking and long liquidation when he said its "too early to declare victory" on the U.S. recovery as unemployment remains too high.
• Bullish factors Tuesday included (1) strength in homebuilders after a smaller-than-expected decline in Jan S&P/CaseShiller composite-20 home prices (unchanged m/m versus expectations of -0.3% m/m), (2) the stronger than expected Mar U.S. consumer confidence (-1.4 to 70.2 versus expectations of -0.7 to 70.1), and (3) comments from the first managing director of the IMF who said "We expect modest growth in the U.S., mild recession in Europe and a continuation of a comfortable level of growth in Asia with a soft landing in China."

Today's Market Focus

• June 10-year T-notes this morning are down -2.5 ticks. T-note prices Tuesday rallied up to a 1-1/2 week high and settled higher after the Fed bought long-term Treasuries as part of its Operation Twist program, the Mar Richmond Fed manufacturing index weakened more than expected and strong demand was seen for the Treasury's $35 billion auction of 2-year T-notes: TYM2 +17.0, FVM2 +9.5, EDU2 +2.0. Bullish factors Tuesday included (1) the Fed's purchase of $1.969 billion of Treasuries as part of its Operation Twist program to replace $400 billion of short-term debt in its portfolio with longer-term Treasuries in an attempt to keep borrowing costs low, (2) the larger-than-expected decline in the Mar Richmond Fed manufacturing index to its weakest level in 4 months (-13 to 7 versus expectations of -2 to 18), (3) strong demand for the Treasury's $35 billion auction of 2-yer T-notes that had a bid-to-cover ratio of 3.69, higher than the 12-auction average of 3.46, and (4) dovish comments from Boston Fed President Rosengren who said "if real GDP does not grow more rapidly and unemployment remains at its current unacceptably high level, monetary policy may need to be more accommodative." Bearish factors included (1) the stronger-than-expected Jan S&P/CaseShiller composite-20 home prices (unchanged m/m versus expectations of -0.3% m/m), (2) the stronger than expected Mar U.S. consumer confidence (-1.4 to 70.2 versus expectations of -0.7 to 70.1), and (3) supply pressures ahead of the Treasury's $35 billion auction of 5-year T-notes on Wed.
• The dollar index this morning is lower with the dollar/yen -0.19 yen and the euro/dollar +0.43 cents. The dollar index Tuesday declined early to a 3-week low but erased its losses and settled higher after stronger than expected U.S. economic data reduced speculation the Fed will increase stimulus measures: Dollar Index +0.174, USD/JPY +0.327, EUR/USD -0.00426. Bullish factors included (1) the stronger-than-expected Mar U.S. consumer confidence and the smaller-than-expected decline in Jan S&P 500/CaseShiller home prices, which signals economic strength that reduces the chances of further Fed stimulus measures, and (2) weakness in the euro which fell back from a 3-1/2 week high against the dollar and closed lower on weak demand for European sovereign debt after Italy sold 3.82 billion euros of bonds, below the maximum target of 4 billion euros, and Spain sold 2.58 billion euros of debt, below its maximum target of 3 billion euros. Bearish factors included (1) the unexpected increase in the Mar French consumer confidence indicator which matched its highest level in 15 months (+5 to 87) and is euro positive, (2) comments from ECB Council member Makuch that reduced expectations of additional ECB stimulus measures when he said he sees no reason for further 3-year loans for now because "the central bank considers as sufficient what it has done so far," and (3) strength in the British pound against the dollar after the pound climbed to a 4-1/4 month high against the dollar after Mar U.K. CBI reported sales rose more than expected.
• May crude oil prices this morning are down -98 cents a barrel and May gasoline is -4.28 cents per gallon. Crude oil and gasoline prices Tuesday settled mixed after dollar strength and comments from DOE officials about a possible release of Strategic Petroleum Reserves offset the bullish aspects of stronger than expected U.S. economic data on Mar U.S. consumer confidence and Jan S&P/CaseShiller home prices: CLK12 +$0.30, RBK -1.23. Bearish factors included (1) the rebound in the dollar as the dollar index recovered from a 3-week low and settled higher, which diminishes investment demand in commodities, (2) comments from the acting assistant secretary for fossil energy at the DOE who said that a release of oil from the Strategic Petroleum Reserve is "being considered," and (3) the larger-than expected decline in the Mar Richmond Fed manufacturing index, which indicates reduced energy consumption. Bullish factors included (1) the stronger-than-expected Mar U.S. consumer confidence, which is positive for fuel demand and (2) the smaller than expected decline in the Jan S&P/CaseShiller composite-20 home prices, which signals economic strength and may lead to increased energy demand. Expectations for Wednesday's weekly DOE inventory report are for crude oil supplies to increase +2.7 million bbl, gasoline stockpiles to fall -1.55 million bbl, distillate inventories to drop -500,000 bbl and the refinery utilization rate to increase +0.3 to 82.5% of capacity.

Today's U.S. Earnings Reports Earnings reports (confirmed releases, sorted by mkt cap): MOS-Mosaic (BEST earnings consensus $0.69), PAYX-Paychex (0.37), RHT-Red Hat (0.27), FDO-Family Dollar Stores (1.13), HII-Huntington Ingalls Industries (0.94), CMC-Commercial Metals (0.09), FUL-HB Fuller (0.37), PRGS-Progress Software (0.25), UNF-Unifirst (0.88), VRNT-Verint Systems (0.68), TXI-Texas Industries (-0.82), LNN-Lindsay (0.82), TEA-Teavana Holdings (0.31), NGL-NGL Energy Partners LP (0.68), RECN-Resources Connection (0.08).
Global Financial Calendar

Wednesday 3/28/12
United States
0700 ET	Weekly MBA mortgage applications, previous -7.4% with purchase mortgage sub-index -1.0% and refinancing sub-index -9.3%.
0830 ET	Feb durable goods orders expected +3.0% and +1.7% ex transportation, Jan -3.7% and -3.0% ex transportation.
1300 ET	Treasury auctions $35 billion 5-year T-notes.
France
0130 ET	Revised Q4 French GDP expected no change at +0.2% q/q and +1.4% y/y.
Euro-Zone
0400 ET	Feb Euro-Zone M3 money supply (seasonally adjusted) expected +2.2% 3-mo avg and +2.4% y/y, Jan +2.0% 3-mo avg and +2.5% y/y.
United Kingdom
0430 ET	Revised Q4 U.K. GDP expected no change at -0.2% q/q and +0.7% y/y.
0430 ET	Revised Q4 U.K. total business investment expected -5.6% q/q and -1.9% y/y, previous -5.6% q/q and -2.0% y/y.
Germany
0800 ET	Mar German CPI (EU harmonized) expected +0.4% m/m and +2.3% y/y, Feb +0.9% m/m and +2.5% y/y
Canada
0900 ET	Jan Canada Teranet/National Bank home price index, Dec -0.2% m/m and +6.8% y/y.
Japan
1950 ET	Feb Japan retail trade expected unchanged m/m and +1.4% y/y, Jan +3.1% m/m and +1.8% y/y.

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