MORNING CALL 2/27

Barchart Morning Call

Barchart.com - Mon Feb 27, 6:45AM CST

OVERNIGHT MARKETS AND NEWS

Mar E-mini S&Ps (ESH17 -0.03%) are little changed, up +0.01% at a new record nearest-futures high, and European stocks are up +0.19%. Market activity is muted as stocks move sideways ahead of U.S. President Trump's address Tuesday before a joint session of Congress where he is expected to lay out his plans for tax and health-care reform and infrastructure spending. A +0.69% gain in Apr WTI crude oil prices (CLJ17 +0.74%) is giving energy producing stocks a boost after Russian Energy Minister Novak said that Russia had cut its oil output this month by more than the 117,000 bpd it had cut its oil production in Jan. European stocks and EUR/USD found support on favorable opinion polls for French presidential candidate Macron along with signs of confidence in the European recovery after Eurozone Feb economic confidence rose to a 5-3/4 year high. Asian stocks settled mostly lower: Japan -0.91%, Hong Kong -0.17%, China -0.76%, Taiwan closed for holiday, Australia -0.26%, Singapore -0.27%, South Korea -052%, India -0.28%. Japan's Nikkei Stock Index tumbled to a 2-week low as exporter stocks sold-off as USD/JPY fell to a 2-week low, which undercuts the earnings prospects of exporters with the stronger yen.

The dollar index (DXY00 -0.01%) is down -0.02%. EUR/USD (^EURUSD) is up +0.19%. USD/JPY (^USDJPY) is up +0.14%. GBP/USD is down -0.41% at a 1-week low after the Times of London reported that UK Prime Minister May is preparing for Scotland to potentially call an independence referendum in March to coincide with the UK's triggering of Article 50 to leave the EU.

Mar 10-year T-note prices (ZNH17 -0.11%)are down -4.5 ticks.

Eurozone Feb economic confidence rose +0.1 to 108.0, weaker than expectations of +0.2 to 108.1 but still the highest in 5-3/4 years.

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) Jan durable goods orders (expected +1.7% and +0.5% ex transportation, Dec -0.5% and +0.5% ex transportation), (2) Jan pending home sales (expected +1.0% m/m, Dec +1.6% m/m and -2.0% y/y), (3) Feb Dallas Fed manufacturing activity index (expected -2.7 to 19.4, Jan +4.4 to 22.1), (4) Dallas Fed President Robert Kaplan (voter) speaks at the University of Oklahoma Price College of Business, (5) USDA weekly grain export inspections.

Notable S&P 500 earnings reports today include: Priceline (consensus $12.97), TEGNA (0.66), AES (0.35), American Tower (1.38), Perrigo (1.62), Frontier Communications (-0.04), EOG Resources (-0.14), ONEOK (0.45), Albemarle (0.73).

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

Equity conferences: Goldman Sachs Technology Conference on Mon, Keefe, Bruyette, & Woods Cards, Payments & Financial Technology Symposium on Mon, Morgan Stanley Technology, Media & Telecom Conference on Mon-Tue BMO Capital Markets Global Metals & Mining Conference on Mon-Tue, JMP Securities Technology Conference on Mon-Tue, JP Morgan Leveraged Finance Conference on Mon-Tue, GSMA Mobile World Congress on Mon-Tue, Morgan Stanley MLP Diversified Natural Gas, Utilities & Clean Tech Conference on Tue, UBS Utilities and Natural Gas Conference on Tue, Barclays MLP Corporate Access Day on Tue, Pacific Crest Emerging Technology Summit on Tue, Evercore ISI Industrial Conference on Tue, CITI Asset Management, Broker Dealer & Market Structure Conference on Wed, Gabelli & Company Pump, Valve & Water Systems Symposium on Wed, Wells Fargo Real Estate Securities Conference on Wed, ABA National Conference on Wed, EnerCom The Oil & Gas Conference on Wed, J.P. Morgan Gaming, Lodging, Restaurant & Leisure Management Access Forum on Thu, Bank of America Merrill Lynch Global Agriculture and Chemicals Conference on Wed-Thu, BTIG Healthcare Conference on Thu, Capital Link Master Limited Partnership Investing Forum on Thu, Simmons Energy Conference on Thu-Fri.

OVERNIGHT U.S. STOCK MOVERS

Reynolds American (RAI -0.08%) was downgraded to 'Market Perform' from 'Outperform' at Wells Fargo Securities.

Carnival Cruise Lines (CCL +0.20%) was upgraded to 'Buy' from 'Hold' at Argus with a price target of $64.

Tesla (TSLA +0.39%) was downgraded to 'Sell' from 'Neutral' at Goldman Sachs with a price target of $185.

Sina Corp China (SINA +4.35%) was downgraded to 'Neutral' from 'Accumulate' at GuoTai JunAn with a target price of $74.

Illumina (ILMN -0.63%) was upgraded to 'Buy' from 'Hold' at Evercore ISI with a price target of $190.

Hanesbrands (HBI +2.20%) was downgraded to 'Equal-Weight' from 'Overweight' at Morgan Stanley.

Terex (TEX +1.47%) was upgraded to 'Buy' from 'Hold' at Deutsche Bank.

Urban Outfitters (URBN +2.21%) was downgraded to 'Sell' from 'Neutral' at MKM Partners.

Merck (MRK +0.47%) said its V212 investigational inactivated varicella zoster virus for prevention of shingles met its primary endpoint in a Phase 3 shingles study.

Raytheon (RTN +0.12%) gained nearly 1% in after-hours trading after it received a $1.07 billion contract from the U.S. Air Force.

Earthlink (ELNK -3.76%) climbed over 3% in after-hours trading after it disclosed in a regulatory filing that shareholders approved an agreement and plan of merger with Windstream.

MARKET COMMENTS

Mar E-mini S&Ps (ESH17 -0.03%) this morning are up +0.25 of a point (+0.01%) at a new all-time nearest-futures high. Friday's closes: S&P 500 +0.15%, Dow Jones +0.05%, Nasdaq +0.21%. The S&P 500 on Friday closed higher on the +0.6 point rise in the U.S. Feb University of Michigan consumer sentiment index to 96.3 (stronger than expectations of +0.3 to 96.0) and on data from EPFR Global showing that U.S. equity funds saw net inflows of $3 billion in the week to Feb 22, the third increase in the last four weeks. Stocks were undercut by the +3.7% increase in U.S. Jan new home sales to 555,000 (weaker than expectations of +6.4% to 571,000) and the -0.84% decline in crude oil prices, which undercut energy producing stocks.

Mar 10-year T-notes (ZNH17 -0.11%) this morning are down -4.5 ticks. Friday's closes: TYH7 +18.00, FVH7 +1.25. Mar 10-year T-notes on Friday rallied to a 2-1/2 month nearest-futures high and closed higher on carry-over support from a rally in German bunds to a 1-3/4 month high on increased safe-haven demand due to political risks in France. T-notes were also boosted by the slide in crude oil prices which reduced inflation expectations and pushed the 10-year T-note breakeven inflation rate down to a 4-session low.

The dollar index (DXY00 -0.01%) this morning is down -0.02 (-0.02%). EUR/USD (^EURUSD) is up +0.0020 (+0.19%). USD/JPY (^USDJPY) is up +0.16 (+0.14%). Friday's closes: Dollar index +0.04 (+0.04%), EUR/USD -0.0019 (-0.18%), USD/JPY -0.49 (-0.44%). The dollar index on Friday closed higher on the stronger-than-expected U.S. Feb University of Michigan consumer sentiment index and on weakness in EUR/USD on European political risks from the French presidential election. Gains in the dollar were limited as the 10-year T-note yield fell to a 5-week low, which undercuts the dollar's interest rate differentials.

Apr WTI crude oil prices (CLJ17 +0.74%) this morning are up +37 cents (+0.69%) and Apr gasoline (RBJ17 +1.03%) is up +0.0149 (+0.86%). Friday's closes: Apr crude -0.46 (-0.84%), Apr gasoline -0.0111 (-0.64%). Apr crude oil and gasoline on Friday closed lower on negative carry-over from Thursday's EIA data that showed a +0.3% increase in U.S. crude production in the week ended Feb 17 to a 10-1/2 month high of 9.001 million bpd and the +564,000 bbl increase in U.S. crude inventories to a record 518.7 million bbl (EIA data from 1982). Crude oil was also undercut by data from Baker Hughes that showed U.S. active oil rigs in the week ended Feb 24 rose 5 to 602, the most in 16-1/2 months.

GLOBAL EVENT CALENDAR02/27/2017

		Monday, Feb 27
US	0830 ET	Jan durable goods orders expected +1.7% and +0.5% ex transportation, Dec -0.5% and +0.5% ex transportation. Jan capital goods new orders non-defense ex aircraft & parts expected +0.5%, Dec +0.7%.
	1000 ET	Jan pending home sales expected +1.0% m/m, Dec +1.6% m/m and -2.0% y/y.
	1030 ET	Feb Dallas Fed manufacturing activity expected -2.7 to 19.4, Jan +4.4 to 22.1.
	1100 ET	USDA weekly grain export inspections.
	1100 ET	Dallas Fed President Robert Kaplan (voter) speaks at the University of Oklahoma Price College of Business.
		Tuesday, Feb 28
US	0830 ET	Revised Q4 GDP expected +2.1% (q/q annualized), previous +1.9% (q/q annualized). Q4 personal consumption expected unrevised at +2.5%. Q4 GDP price index expected unrevised at +2.1%. Q4 core PCE expected unrevised at +1.3% q/q.
	0830 ET	Jan wholesale inventories expected +0.4%, Dec +1.0% m/m. Jan retail inventories, Dec unch m/m.
	0900 ET	Dec S&P CoreLogic composite-20 home price index expected +0.7% m/m and +5.3% y/y, Nov +0.88% m/m and +5.27% y/y.
	0945 ET	Feb Chicago PMI expected +2.7 to 53.0, Jan -3.6 to 50.3.
	1000 ET	Feb Conference Board U.S. consumer confidence index expected -0.8 to 111.0, Jan -1.5 to 111.8.
	1000 ET	Feb Richmond Fed manufacturing index expected -2 to 10, Jan +4 to 12.
	1500 ET	Philadelphia Fed President Patrick Harker (voter) speaks on the economic outlook at Temple University.
	1530 ET	San Francisco Fed President John Williams (non-voter) delivers an outlook speech to the Santa Cruz Chamber of Commerce.
	1850 ET	St. Louis Fed President James Bullard (non-voter) gives the Spring 2017 GWU Alumni Lecture in Economics at George Washington University.
	2100 ET	President Trump delivers speech to joint session of Congress.

U.S. STOCK CALENDAR02/27/2017

Company	Ticker	Time	Event Description	Period	Estimate
TEGNA Inc	TGNA US	Bf-mkt	Q4 2016 Earnings Release	Q4 2016	0.664
AES Corp/VA	AES US	6:00	Q4 2016 Earnings Release	Q4 2016	0.354
American Tower Corp	AMT US	7:00	Q4 2016 Earnings Release	Q4 2016	1.42
American Tower Corp	AMT US	8:30	Q4 2016 Earnings Call	Q4 2016
AES Corp/VA	AES US	9:00	Q4 2016 Earnings Call	Q4 2016
TEGNA Inc	TGNA US	10:00	Q4 2016 Earnings Call	Q4 2016
Perrigo Co PLC	PRGO US	16:00	Q4 2016 Earnings Release	Q4 2016	1.616
Priceline Group Inc/The	PCLN US	16:00	Q4 2016 Earnings Release	Q4 2016	12.963
Frontier Communications Corp	FTR US	16:05	Q4 2016 Earnings Release	Q4 2016	-0.035
Frontier Communications Corp	FTR US	16:30	Q4 2016 Earnings Call	Q4 2016
Perrigo Co PLC	PRGO US	16:30	Q4 2016 Earnings Call	Q4 2016
Priceline Group Inc/The	PCLN US	16:30	Q4 2016 Earnings Call	Q4 2016
EOG Resources Inc	EOG US	Aft-mkt	Q4 2016 Earnings Release	Q4 2016	-0.144
ONEOK Inc	OKE US	Aft-mkt	Q4 2016 Earnings Release	Q4 2016	0.458
Albemarle Corp	ALB US	Aft-mkt	Q4 2016 Earnings Release	Q4 2016	0.718
Berkshire Hathaway Inc	BRK/A US		Q4 2016 Earnings Release	Q4 2016	2716.6

MORNING CALL 5/12

MORNING CALL

Thursday, May 12th, 2016View Older Reports

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OVERNIGHT MARKETS AND NEWS

Jun E-mini S&Ps (ESM16 +0.57%) are up +0.60% and European stocks are up +0.95% as a +0.89% rally in Jun WTI crude oil (CLM16 +0.82%) to a 1-1/2 week high lifts energy producing stocks. Crude oil is higher after the IEA cut its global crude oil surplus estimate for the first half of 2016 to 1.3 million bpd from 1.5 million bpd forecast last month, citing robust demand in India and other emerging markets. European stocks rose despite an unexpected decline in Eurozone Mar industrial production. Asian stocks settled mixed: Japan +0.41%, Hong Kong -0.70%, China -0.04%, Taiwan-0.34%, Australia -0.24%, Singapore +0.46%, South Korea -0.30%, India +0.75%. Gains in Japanese stocks were held back by a -1.4% drop in Toyota after the automaker forecast its yearly profit will probably decline for the first time in 5 years.

The dollar index (DXY00 +0.26%) is up +0.26%. EUR/USD (^EURUSD) is down -0.27%% after Eurozone Mar industrial production unexpectedly fell. USD/JPY (^USDJPY) is up +0.73%.

Jun T-note prices (ZNM16 -0.17%) are down -7.5 ticks.

As expected, the BOE kept its benchmark rate unchanged at 0.50% and maintained its asset purchase target at 375 billion pounds following today's policy meeting. The BOE also cut its UK 2016 GDP forecast to 2.0% from a 2.2% estimate in Feb, citing uncertainty regarding next month's referendum on whether the UK will remain in the European Union.

Eurozone Mar industrial production unexpectedly fell -0.8% m/m, weaker than expectations of no change.

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) weekly initial unemployment claims (expected -4,000 to 270,000, previous +17,000 to 274,000) and continuing claims (expected -1,000 to 2.120 million, previous -8,000 to 2.121 million), (2) Apr import price index (expected +0.6% m/m and -5.4% y/y, Mar +0.2% m/m and-6.2% y/y), (3) Cleveland Fed President Loretta Mester speaks on monetary policy and inflation dynamics at an event in Reichenau Island, Germany, (4) Boston Fed President Eric Rosengren delivers luncheon speech to the Great Concord Chamber in Concord, NH, (5) the Treasury auction of $15 billion of 30-year T-bonds, (6) Kansas City Fed President Esther George speaks about the U.S. economy to business and community leaders in Albuquerque, NM, and (7) USDA weekly Export Sales.

There are 6 of the Russell 1000 companies that report earnings today: Kohl's (consensus $0.37), Perrigo (1.72), Ralph Lauren (0.83), NVIDIA (0.41), Nordstrom (0.46), Symantec (0.22).

U.S. IPO's scheduled to price today: Oncobiologics (ONS), Cancer Prevention Pharmaceuticals (CPP), Acacia Communications (ACIA).

Equity conferences during the remainder of this week include: Bank of America Merrill Lynch Health Care Conference on Tue-Thu, Jefferies Technology, Media and Telecom Conference on Wed-Thu, Mitsubishi UFJ Oil & Gas Conference on Thu, Morgan Stanley Refining Corporate Access Day on Thu, RBC Capital Markets Aerospace & Defense Investor Day on Thu.

OVERNIGHT U.S. STOCK MOVERS

Jack in the Box (JACK -5.24%) jumped 11% in pre-market trading after it reported Q2 adjusted operating EPS of 85 cents, higher than consensus of 70 cents.

Berry Plastics Group (BERY +2.32%) was rated a new 'Buy' at Goldman Sachs.

Weight Watchers International (WTW -0.88%) climbed over 1% in after-hours trading after Oprah Winfrey was elected to a 2-year term on the company's board.

Janus Capital Group (JNS -2.05%) was downgraded to 'Market Perform' from 'Outpeform' at Wells Fargo Securities.

St. Jude Medical (STJ +0.23%) was downgraded to 'Neutral' from 'Buy' at UBS.

Kohl's (KSS -6.02%) slid over 4% in pre-market trading after it reported Q1 EPS of 31 cents, below consensus of 37 cents.

Owens-Illinois (OI +0.57%) was rated a new 'Sell' by Goldman Sachs.

SINA Corp/China (SINA +0.67%) dropped over 4% in after-hours trading after it reported a Q1 adjusted EPS loss of -4 cents, a wider loss than consensus of -3 cents.

Weibo (WB -0.43%) rose nearly 3% in after-hours trading after it reported Q1 adjusted EPS of 7 cents, better than consensus of 4 cents.

Spin Master (SNMSF +2.40%) reported Q1 adjusted EPS of 12 cents, double consensus of 6 cents.

CA Inc. (CA -0.63%) gained 3% in after-hours trading after it reported Q4 adjusted continuing operations EPS of 60 cents, higher than consensus of 57 cents, and said it sees fiscal 2017 adjusted EPS continuing operation of $2.51-$2.56, above consensus of $2.49.

Loxo Oncology (LOXO -5.36%) dropped over 4% in after-hours trading after it announced a public equity offering. Price, volume and terms have yet to be announced.

MARKET COMMENTS

June E-mini S&Ps (ESM16 +0.57%) this morning are up +12.25 points (+0.60%). Wednesday's closes: S&P 500 -0.96%, Dow Jones -1.21%, Nasdaq-0.93%. The S&P 500 on Wednesday closed lower on carryover weakness from a slide in European stocks on concern about the health of the European banking sector after ABN Amro Group NV reported a -13% decline in Q1 profits. U.S. stocks were also undercut by weakness in U.S. retail stocks led by a -15% plunge in Macy's, the largest U.S department store company, after it reported weaker-than-expected Q1 revenue and cut its profit forecast for this year.

June 10-year T-note prices (ZNM16 -0.17%) this morning are down -7.5 ticks. Wednesday's closes: TYM6 +4.00, FVM6 +0.25. Jun T-notes on Wednesday closed higher on increased safe-haven demand with the weakness in stocks and on strong demand for the Treasury's $23 billion 10-year T-note auction where indirect bidders, a proxy for foreign buyers, purchased a record 73.5% of the auction, higher than the 12-auction average of 60.7%.

The dollar index (DXY00 +0.26%) this morning is up +0.244 (+0.26%). EUR/USD (^EURUSD) is down -0.0031 (-0.27%). USD/JPY (^USDJPY) is up +0.79 (+0.73%). Wednesday's closes: Dollar Index -0.467 (-0.50%), EUR/USD +0.0054 (+0.47%), USD/JPY -0.86 (-0.79%). The dollar index on Wednesday closed lower on strength in the currencies of the oil-exporting countries of Canada and Russia after the price of crude oil jumped +3%.

June WTI crude oil (CLM16 +0.82%) this morning is up +41 cents (+0.89%) at a 1-1/2 week high. June gasoline (RBM16 -0.13%) is up +0.0002 (+0.01%). Wednesday's closes: CLM6 +1.33 (+2.98%), RBM6 +0.0849 (+5.71%). Jun crude and gasoline on Wednesday posted 1-week highs and closed higher on a weaker dollar, the unexpected -3.41 million bbl decline in EIA crude inventories (vs expectations of +750,000 bbl), and the -0.3%drop in U.S. crude output in the week ended May 6 to a 1-1/2 year low of 8.802 million bpd.

GLOBAL EVENT CALENDAR05/12/2016

US	0830 ET	Weekly initial unemployment claims expected -4,000 to 270,000, previous +17,000 to 274,000. Weekly continuing claims expected-1,000 to 2.120 million, previous -8,000 to 2.121 million.
	0830 ET	Apr import price index expected +0.6% m/m and -5.4% y/y, Mar +0.2% m/m and -6.2% y/y.
	0830 ET	USDA weekly Export Sales.
	1100 ET	Cleveland Fed President Loretta Mester speaks on monetary policy and inflation dynamics at an event in Reichenau Island, Germany.
	1100 ET	Treasury announces amount of 10-year TIPS to be auctioned May 19.
	1145 ET	Boston Fed President Eric Rosengren delivers luncheon speech to the Great Concord Chamber in Concord, NH.
	1300 ET	Treasury auctions $15 billion 30-year T-bonds.
	1330 ET	Kansas City Fed President Esther George speaks about the U.S. economy to business and community leaders in Albuquerque, NM.
JPN	0030 ET	Japan Apr bankruptcies, Mar -13.15% y/y.
	0100 ET	Japan Apr eco-watchers survey current expected -1.4 to 44.0, Mar 45.4. Apr eco-watchers survey outlook expected -0.5 to 46.2, Mar 46.7.
GER	0200 ET	German Apr wholesale price index, Mar +0.3% m/m and -2.6% y/y.
EUR	0500 ET	Eurozone Mar industrial production expected unch m/m and +0.9% y/y, Feb -0.8% m/m and +0.8% y/y.
UK	0700 ET	BOE announces interest rate decision and asset purchase target, expected no change to the 0.50% benchmark rate or to the 375 billion-pound asset purchase target.

U.S. STOCK CALENDAR05/12/2016

Company	Ticker	Time	Event Description	Period	Estimate
Kohl's Corp	KSS US	Bef-mkt	Q1 2017 Earnings Release	Q1 2017	0.37
Perrigo Co PLC	PRGO US	6:00	Q1 2016 Earnings Release	Q1 2016	1.721
WW Grainger Inc	GWW US	8:00	April 2016 Sales and Revenue Call	2016
WW Grainger Inc	GWW US	8:00	April 2016 Sales and Revenue Release	2016
Perrigo Co PLC	PRGO US	8:00	Q1 2016 Earnings Call	Q1 2016
Principal Financial Group Inc	PFG US	8:00	Roadshow - Paris	Y 2016
Ralph Lauren Corp	RL US	8:00	Q4 2016 Earnings Release	Q4 2016	0.833
Ford Motor Co	F US	8:30	Annual General Meeting
Kohl's Corp	KSS US	8:30	Q1 2017 Earnings Call	Q1 2017
E*TRADE Financial Corp	ETFC US	8:30	Annual General Meeting	Y 2016
Ralph Lauren Corp	RL US	9:00	Q4 2016 Earnings Call	Q4 2016
EMC Corp/MA	EMC US	10:00	Annual General Meeting	Y 2016
Owens-Illinois Inc	OI US	10:00	Annual General Meeting
Cimarex Energy Co	XEC US	10:00	Annual General Meeting
Discover Financial Services	DFS US	10:00	Annual General Meeting	Y 2016
Apache Corp	APA US	11:00	Annual General Meeting	Y 2016
Exxon Mobil Corp	XOM US	11:00	Executive Compensation Update Call
Torchmark Corp	TMK US	11:00	Annual General Meeting	Y 2016
Transocean Ltd	RIG US	11:00	Annual General Meeting	Y 2016
Valero Energy Corp	VLO US	11:00	Annual General Meeting	Y 2016
CF Industries Holdings Inc	CF US	11:00	Annual General Meeting
Union Pacific Corp	UNP US	13:00	Annual General Meeting
Invesco Ltd	IVZ US	13:00	Annual General Meeting
Edwards Lifesciences Corp	EW US	13:00	Annual General Meeting
NVIDIA Corp	NVDA US	16:20	Q1 2017 Earnings Release	Q1 2017	0.407
Nordstrom Inc	JWN US	16:45	Q1 2017 Earnings Call	Q1 2017
Symantec Corp	SYMC US	17:00	Q4 2016 Earnings Call	Q4 2016
NVIDIA Corp	NVDA US	17:00	Q1 2017 Earnings Call	Q1 2017
Nordstrom Inc	JWN US	Aft-mkt	Q1 2017 Earnings Release	Q1 2017	0.456
Symantec Corp	SYMC US	Aft-mkt	Q4 2016 Earnings Release	Q4 2016	0.22
Dow Chemical Co/The	DOW US		Annual General Meeting
Host Hotels & Resorts Inc	HST US		Annual General Meeting
Norfolk Southern Corp	NSC US		Annual General Meeting - Proxy Fight
UDR Inc	UDR US		Annual General Meeting
AutoNation Inc	AN US		Annual General Meeting	Y 2016
Waste Management Inc	WM US		Annual General Meeting
Western Union Co/The	WU US		Annual General Meeting
CH Robinson Worldwide Inc	CHRW US		Annual General Meeting
Sempra Energy	SRE US		Annual General Meeting
Assurant Inc	AIZ US		Annual General Meeting
Zoetis Inc	ZTS US		Annual General Meeting	Y 2016

Barchart Morning Call 8/14

Barchart Morning Call

BC - Wed Aug 14, 6:45AM CDT

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OVERNIGHT MARKETS AND NEWS

September E-mini S&Ps (ESU13 -0.15%) this morning are down -0.13%, although European stocks are up +0.11% after Eurozone Q2 GDP expanded more than forecast and after UK July jobless claims fell more than expected. Asian stocks closed mixed: Japan +1.32%, Hong Kong closed because of Typhoon Utor, China -0.42%, Taiwan -0.44%, Australia -0.01%, Singapore +0.14%, South Korea +0.65%, India +0.72%. Commodity prices are mixed. Sep crude oil (CLU13 -0.74%) is down -0.65%, Sep gasoline (RBU13 -0.53%) is down -0.49%, Dec gold (GCZ13 +0.30%) is up +0.32%, and Sep copper (HGU13 +0.08%) is up +0.18%. Agricultural and livestock prices are mixed. The dollar index (DXY00 +0.04%) is little changed, up +0.01%. EUR/USD (^EURUSD) is down -0.11% and USD/JPY (^USDJPY) is down -0.02%. September T-note prices (ZNU13 +0.02%) are up +2 ticks.
German Q2 GDP expanded at a +0.7% q/q and +0.5% y/y pace, stronger than expectations of +0.6% q/q and +0.2% y/y.
Eurozone Q2 GDP grew +0.3% q/q and fell -0.7% y/y, better than expectations of +0.2% q/q and -0.8% y/y.
Sovereign borrowing costs have fallen throughout the Eurozone as Italy's 10-year yield premium over benchmark German bunds shrank to 237 bp and Spain's 10-year yield premium over bunds shrank to 265 bp, both at their lowest levels in 2 years.
UK July jobless claims fell -29,200, nearly double expectations of -15,000, while Jun was revised up to show a -29,400 decrease in jobless claims, the biggest decline in 3-years and more than the originally reported -21,200. The July claimant count rate unexpectedly fell -0.1 to 4.3%, the lowest in 4-1/3 years and better than expectations of unchanged at 4.4%.
UK employment in the 3-months through Jun rose +69,000 to a record 29.8 million, while the unemployment rate in the 3-moths through June remained unchanged at 7.8%
UK Jun average weekly earnings rose +2.1% 3-month/year-over-year, a bigger increase than expectations of +2.0% 3-month/year-over-year and the most in 1-3/4 years. Jun average earnings ex-bonus rose +1.1% 3-month/year=over=year, right on expectations.

U.S. STOCK PREVIEW

Today’s July PPI report is expected to ease slightly to +2.4% y/y from +2.5% in June. Meanwhile, today’s July core PPI is expected to fall to +1.3% y/y from +1.7% in June, illustrating continued disinflation pressures. There are 5 of the S&P 500 companies that report earnings today: Deere (consensus $2.18), Macy's (0.78), Agilent Technologies (0.62), Cisco Technologies (0.62), Cisco (0.51), NetApp (0.49).
Conferences during the remainder of this week include: Jefferies Global Industrials Conference on Mon-Thu, EnerCom The Oil & Gas Conference on Mon-Wed, Oppenheimer Technology, Internet & Communications Conference on Tue-Wed, JP Morgan Auto Conference on Tue-Wed, J.P. Morgan Auto Conference on Tue-Wed, Jefferies Global Clean Technology Conference on Tue-Wed, Avondale 2013 Healthcare Conference on Wed, and Canaccord Genuity Growth Conference on Wed.

OVERNIGHT U.S. STOCK MOVERS

Aeropostale (ARO -0.53%) was downgraded to "Underweight" from "Hold" at KeyBanc.
Transocean (RIG -0.21%) was downgraded to "Neutral" from "Strong Buy" at ISI Group.
Deere & Co. (DE +0.64%) reported Q3 EPS of $2.56, stronger than consensus of $2.18.
US Airways (LCC -13.07%) and Delta Air Lines (DAL) were both downgraded to "Neutral" from "Overweight" at JPMorgan.
United Microelectronics (UMC +0.50%) was downgraded to "Sell" from "Neutral" at Goldman.
Citigroup upgraded (SINA +3.17%) to "Buy" from "Sell" and raised its price target for the stock to $96 from $35.
Towers Watson (TW +0.52%) reported Q4 adjusted EPS of $1.36, better than consensus of $1.27.
CNBC said David Tepper added 7 million shares of Goodyear Tire (GT -0.88%) to his holdings, which now stand at 22 million shares, making Tepper the largest shareholder of Goodyear Tire.
JDSU (JDSU unch) dropped over 1% in European trading after it lowered its Q1 revenue estimate to $410 million-$430 million, lower than consensus $432.79 million.
SeaWorld (SEAS -0.41%) reported Q2 adjusted EPS of 41 cents, well below consensus of 51 cents, and cut its fiscal 2013 revenue estimate to 1.45 billion-$1.48 billion, below consensus $1.5 billion.
Cree (CREE +1.35%) fell 15% in after-hours trading after it cut its Q1 revenue estimate to $380 million-$400 million, below consensus of $398.4 million, and said its sees Q1 EPS of 36 cents-41 cents, also below consensus of 43 cents.
PennyMac (PMT -1.57%) files to sell 11.3 million shares of common stock.
Brocade (BRCD +1.02%) jumped 15% in after-hours trading after it reported Q3 adjusted EPS of 19 cents, stronger than consensus of 12 cents.

MARKET COMMENTS

Sep E-mini S&Ps (ESU13 -0.15%) this morning are down -2.25 points (-0.13%). The S&P 500 index on Tuesday closed higher on positive factors including (1) carry-over support from a rally in European stocks after German Aug ZEW investor sentiment climbed +5.7 points to a 5-month high of 42.0, and (2) signs the economy is expanding moderately after U.S. July retail sales increased close to market estimates (0.2% and +0.5% ex autos, close to expectations of +0.3% and +0.4% ex autos). Gains remain limited on expectations the Fed will soon begin to taper its stimulus. Closes: S&P 500 +0.28%, Dow Jones +0.20%, Nasdaq 100 +0.48%.
Sep 10-year T-notes (ZNU13 +0.02%) this morning are up +2 ticks. Sep 10-year T-note prices on Tuesday fell sharply to a 1-week low and closed lower after U.S. retail sales increased near expectations, which fueled speculation the economy is strong enough for the Fed to begin reducing its bond buying. Closes: TYU3 -29.5, FVU3 -14.75.
The dollar index (DXY00 +0.04%) this morning is up +0.006 (+0.01%). EUR/USD (^EURUSD) is down -0.0015 (-0.11%) and USD/JPY (^USDJPY) is down -0.02 (-0.02%). The dollar index on Tuesday closed higher after U.S. July retail sales increased for a fourth month, which bolstered expectations that the Fed will soon taper its dollar-negative QE3 program. EUR/USD slipped to a 1-week low after Eurozone Jun industrial production rose +0.7% m/m, weaker than expectations of +1.0% m/m. Closes: Dollar index +0.435 (+0.53%), EUR/USD -0.00377 (-0.28%), USD/JPY +1.298 (+1.34%).
Sep WTI crude oil (CLU13 -0.74%) this morning is down -0.69 (-0.65%) and Sep gasoline (RBU13 -0.53%) is down -0.0145 (-0.49%). Sep crude oil and gasoline prices on Tuesday closed higher as stronger-than-expected German Aug ZEW investor sentiment and expectations for weekly EIA crude inventories to decline on Wednesday offset the bearish factors of a stronger dollar and concern the Fed may be close to tapering QE3. Closes: CLU3 +0.72 (+0.68%), RBU3 +0.0337 (+1.16%).

GLOBAL EVENT CALENDAR08/14/2013

US	0700 ET	Weekly MBA mortgage applications, previous +0.2% with purchase sub-index +0.7% and refi sub-index -0.1%.
	0830 ET	July PPI expected +0.3% m/m and +2.4% y/y, Jun +0.8% m/m and +2.5% y/y. July PPI ex food & energy expected +0.2% m/m and +1.3% y/y, Jun +0.2% m/m and +1.7% y/y.
	1030 ET	EIA Weekly Petroleum Status Report.
	1320 ET	St. Louis Fed President James Bullard speaks at the Paducah Convention Center on Challenges with Monetary Policy in Paducah, Kentucky.
GER	0200 ET	German Q2 GDP expected +0.6% q/q and +0.2% y/y, Q1 +0.1% q/q and -0.2% y/y.
UK	0430 ET	Minutes of the July 31-Aug 1 BOE policy meeting.
	0430 ET	UK July jobless claims change expected -15,000, Jun -21,200. July claimant count rate expected unch at 4.4%, Jun 4.4%.
	0430 ET	UK Jun ILO unemployment rate expected 7.8% 3-months, May 7.8% 3-months.
	0430 ET	UK Jun avg weekly earnings expected +2.0% 3-mo/year-over-year, May +1.7% 3-mo/year-over-year. Jun weekly earnings ex-bonus expected +1.1% 3-mo/year-over-year, May +1.0% 3-mo/year-over-year.
EUR	0500 ET	Eurozone Q2 GDP expected +0.2% q/q and -0.8% y/y, Q1 -0.2% q/q and -1.1% y/y.

U.S. STOCK CALENDAR08/14/2013

Company Name	Symbol	Time	Event Description	Period	EPS Est (US$)
Charles Schwab Corp/The	SCHW US	Bef-mkt	July 2013 Sales and Revenue Release - Activity Report	2013
Deere & Co	DE US	Bef-mkt	Q3 2013 Earnings Release	Q3 2013	2.175
Macy's Inc	M US	8:00	Q2 2014 Earnings Release	Q2 2014	0.782
Deere & Co	DE US	10:00	Q3 2013 Earnings Call	Q3 2013
Macy's Inc	M US	10:30	Q2 2014 Earnings Call	Q2 2014
NetApp Inc	NTAP US	Aft-mkt	Q1 2014 Earnings Release	Q1 2014	0.492
Progressive Corp/The	PGR US		July 2013 Sales and Revenue Release	2013
Stericycle Inc	SRCL US		Investor Meeting	Y 2013
Xilinx Inc	XLNX US		Annual General Meeting