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Jim Van Meerten is an advisor to Marketocracy Capital Management and writes on financial subjects here and on Barchart Portfolio Blogs. He earned a BS in Accounting and Business Administration from Berry College; a Juris Doctorate from the Woodrow Wilson School of Law; and attended... More
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  • BARCHART MORNING CALL 7/3

    BARCHART MORNING CALL

    Thursday, July 3rd, 2014

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    OVERNIGHT MARKETS AND NEWS

    September E-mini S&Ps (ESU14 +0.09%) this morning are up +0.09% and European stocks are up +0.63% on optimism that today's U.S. Jun payrolls report will show employers added more than 200,000 jobs for a fifth month. The markets will also eagerly interpret comments from ECB President Draghi following today's ECB monetary policy meeting. Asian stocks closed mixed: Japan -0.14%, Hong Kong -0.08%, China +0.43%, Taiwan +0.44%, Australia +0.66%, Singapore +0.28%, South Korea -0.35%, India -0.07%. China's Shanghai Stock Index climbed to a 2-week high on signs the Chinese economy is growing after a gauge of manufacturing and service industry activity expanded at the fastest pace in 1-1/4 years. Commodity prices are mixed. Aug crude oil (CLQ14 -0.68%) is down -0.58% at a 3-week low on signs of increased supplies after Libya said it was opening the Es Sider and Ras Lanuf oil export facilities after reaching an agreement with rebels who had blockaded the ports for the past year. Aug gasoline (RBQ14 -0.29%) is down -0.36%. Aug gold (GCQ14 -0.83%) is down -0.66%. Sep copper (HGU14 -0.41%) is down -0.43%. Agriculture and livestock prices are higher with Aug live cattle prices up +1.43% at an all-time high. The dollar index (DXY00 +0.11%) is up +0.11%. EUR/USD (^EURUSD) is down -0.06% on speculation ECB President Draghi will jawbone EUR/USD lower when he speaks later today. USD/JPY (^USDJPY) is up +0.11% at a 1-week high. Sep T-note prices (ZNU14 unch) are little changed, up +0.5 of a tick.

    Eurozone May retail sales were unch m/m and +0.7% y/y, weaker than expectations of +0.3% m/m and +1.8% y/y. Apr retail sales were revised down to -0.2% m/m and +1.8% y/y from the originally reported +0.4% m/m and +2.4% y/y.

    The German Jun Markit services PMI was revised downward to 54.6 from the originally reported 54.8.

    The UK Jun Markit/CIPS services PMI fell -0.9 to 57.7, a bigger drop than expectations of -0.3 to 58.3

    The China Jun HSBC composite PMI rose +2.2 to 52.4, the fastest pace expansion in 1-1/4 years.

    The China Jun non-manufacturing PMI fell -0.5 to 55.0.

    U.S. STOCK PREVIEW

    The market is expecting today's June payroll report to show a +215,000 increase, close to the +217,000 increase seen in May. The market is expecting today's June unemployment rate to remain unchanged from the 5-3/4 year low of 6.3% posted in April and May. Today's weekly initial unemployment claims report is expected to show a small increase of +1,000 to 313,000 following last week's -2,000 decline to 312,000. Meanwhile, continuing claims are expected to show a decline of -11,000 to 2.560 million, reversing most of last week's +12,000 increase to 2.571 million. Today's May U.S. trade deficit report is expected to narrow mildly to -$45.0 billion from -$47.2 billion in April. Today's June ISM non-manufacturing index is expected to be unchanged at 56.3, stalling after May's +1.1 point increase to 56.3. There are no Russell 1000 companis that report earnings today. There are no equity conferences this week.

    OVERNIGHT U.S. STOCK MOVERS

    Stifel raised its price target for Constellation Brands (STZ +2.34%) to $113 from $90 following the company's Q1 results and keeps a 'Buy' rating on the stock.

    International Speedway (ISCA +1.02%) reported Q2 adjusted EPS of 50 cents, better than consensus of 49 cents.

    Cree (CREE -0.08%) was upgraded to 'Outperform' from 'Perform' at Oppenheimer.

    Comerica (CMA -0.42%) was downgraded to 'Neutral' from 'Buy' at Citigroup.

    Athlon Energy (ATHL -1.47%) was upgraded to 'Buy' from 'Neutral' at UBS.

    Altai Capital lowered its stake in RealD (RLD -0.85%) to 5.7% from 9.8%.

    Billionare activist investor Carl Icahn reported a 9.39% stake in Family Dollar (FDO +1.29%) .

    East Rock Capital reported a 15% passive stake in Bay Bank (BYBK +1.57%) .

    SYNNEX (SNX +0.18%) reported Q2 EPS of $1.52, well ahead of consensus of $1.36.

    MARKET COMMENTS

    Sep E-mini S&Ps (ESU14 +0.09%) this morning are up +1.75 points (+0.09%). The S&P 500 index on Wednesday closed higher but remained below Tuesday's record high. Signs of strength in the U.S. labor market boosted stocks after Jun ADP employment rose +281,000, stronger than expectations of +205,000 and the largest increase in 1-1/2 years. Gains were muted after (1) U.S. May factory orders fell -0.5%, a bigger decline than expectations of -0.3%, and (2) airline stocks tumbled when Delta Air Lines said that excess capacity in some international markets forced air fares down more than expected. Closes: S&P 500 +0.07%, Dow Jones +0.12%, Nasdaq +0.13%.

    Sep 10-year T-notes (ZNU14 unch) this morning are up +0.5 of a tick. Sep 10-year T-note futures prices on Wednesday fell to a 1-week low and closed lower on signs the economy is strengthening after the Jun ADP employment change rose by the most in 1-1/2 years. Losses in T-notes were contained after May factory orders fell more than expected. Closes: TYU4 -15.50, FVU4 -9.25.

    The dollar index (DXY00 +0.11%) this morning is up +0.089 (+0.11%). EUR/USD (^EURUSD) is down -0.0008 (-0.06%). USD/JPY (^USDJPY) is up +0.11 (+0.11%) at a 1-week high. The dollar index on Wednesday closed higher on signs the U.S. economy may be gaining traction after Jun ADP employment rose by the most in 1-1/2 years. EUR/USD closed lower on speculation ECB President Draghi may attempt to jawbone EUR/USD lower following Thursday's ECB meeting as EUR/USD is higher now than when the ECB expanded stimulus measures following last month's policy meeting. Closes: Dollar index +0.141 (+0.18%), EUR/USD -0.0020 (-0.15%). USD/JPY +0.253 (+0.25%).

    Aug WTI crude oil (CLQ14 -0.68%) this morning is down -61 cents (-0.58%) at a 3-week low. Aug gasoline (RBQ14 -0.29%) is down -0.0109 (-0.36%). Aug crude and gasoline prices on Wednesday fell to 2-week lows and closed lower on speculation Tropical Storm Arthur will curb fuel demand on the U.S. East coast over the Fourth of July holiday. Prices recovered from their worst levels on bullish factors that included (1) the -1.359 million bbl drop in crude supplies at Cushing, OK, the delivery point for WTI futures, to a 5-1/4 year low, and (2) the unexpected -1.24 million bbl drop in weekly EIA gasoline inventories vs expectations for a +550,000 bbl build. Closes: CLQ4 -0.86 (-0.82%) RBQ4 -0.0154 (-0.51%).

    GLOBAL EVENT CALENDAR07/03/2014

    US0830 ETWeekly initial unemployment claims expected +1,000 to 313,000, previous -2,000 to 312,000. Weekly continuing claims expected -11,000 to 2.560 million, previous +12,000 to 2.571 million.
     0830 ETMay trade balance expected -$45.0 billion, Apr -$47.2 billion.
     0830 ETJun non-farm payrolls expected +215,000, May +217,000. Jun private payrolls expected +213,000, May 216,000. Jun manufacturing payrolls expected +10,000, May +10,000. Jun unemployment rate expected unch at 6.3%.
     0830 ETJun avg hourly earnings expected +0.2% m/m and +1.9% y/y, May +0.2% m/m and +2.1% y/y. Jun avg weekly hours expected unch at 34.5 hours.
     0830 ETUSDA weekly Export Sales.
     0945 ETJun Markit services PMI expected -0.2 to 61.0, May +3.1 to 61.2. Jun Markit composite PMI, May +2.7 to 61.1.
     1000 ETJun ISM non-manufacturing index expected unch at 56.3, May +1.1 to 56.3.
     1100 ETTreasury announces amount of 3-year T-notes (previous $28 billion), 10-year T-notes (previous $21 billion) and 30-year T-bonds (previous $13 billion) to be auctioned Jul 8-10.
     1300 ETNYSE closes early before the July 4 holiday.
    GER0355 ETRevised German Jun Markit/BME services PMI, previous 54.2.
    EUR0400 ETRevised Eurozone Jun Markit composite PMI, previous 52.8.
     0500 ETEurozone May retail sales expected +0.3% m/m and +1.8% y/y, Apr +0.4% m/m and +2.4% y/y.
     0745 ETECB announces interest rate decision.
     0830 ETECB President Mario Draghi holds press conference following ECB meeting.
    UK0430 ETUK Jun Markit/CIPS services PMI expected -0.3 to 58.3, May 58.6.

    U.S. STOCK CALENDAR07/03/2014

    Company NameTickerTimeEvent DescriptionPeriodEstimate
    Rite Aid CorpRAD US June Sales and Revenue Call  
    Walgreen CoWAG US June 2014 Sales and Revenue Release2014 

    Tags: STZ, ISCA, CREE, CMA, ATHL, RLD, FDO, SNX, RAD, WAG
    Jul 03 10:30 AM | Link | Comment!
  • GlobalStar - Barchart's Chart Of The Day

    The Chart of the Day belongs to GlobalStar (OTCQB:GSAT). I fond the stock by sorting the New High list for new high frequency in the last month then used the Flipchart feature to review the charts. Since the Trend Spotter signaled another buy on 4/22 the stock has gained 59.27%.

    GSAT offers satellite voice and data services to commercial and recreational users in more than 120 countries around the world. GSAT's products include mobile and fixed satellite telephones, simplex and duplex satellite data modems and flexible service packages. Many land based and maritime industries benefit from GSAT with increased productivity from remote areas beyond cellular and landline service. Global customer segments include: oil and gas, government, mining, forestry, commercial fishing, utilities, military, transportation, heavy construction, emergency preparedness, and business continuity as well as individual recreational users. GSAT's data solutions are ideal for various asset and personal tracking, data monitoring and SCADA applications.

    (click to enlarge)

    The status of Barchart's Opinion trading systems are listed below. Please note that the Barchart Opinion indicators are updated live during the session every 10 minutes and can therefore change during the day as the market fluctuates. The indicator numbers shown below therefore may not match what you see live on the Barchart.com web site when you read this report.

    Barchart technical indicators:

    • 96% Barchart technical buy signals
    • Trend Spotter buy signal
    • Above its 20, 50 and 100 day moving averages
    • 10 new highs and up 23.43% in the last month
    • Relative Strength Index 71.81%
    • Barchart computes a technical support level at 4,06
    • Recently traded at 4.38 with a 50 day moving average of 3.48


    Fundamental factors:

     

    • Market Cap $2.82 billion
    • Revenue expected to grow 8.50% this year and another 20.10% next year
    • Earnings are estimated to increase 63.20% next year and continue to compound at an annual rate of 15.00% for the next 5 years
    • The Wall Street analyst recommending the stock has published a buy signal


    This stock was a Chart of the Day back in May and continues to rise. Watch that 100 day moving average for an exit point.

    Tags: GSAT
    Jul 02 5:18 PM | Link | 2 Comments
  • 5 Small Caps On The Move

    Today I used Barchart to sort the S&P 600 Small Cap Index stocks to find the ones with the best momentum and charts. I fist sorted for new high frequency in the last month, then used the Flipchart feature to review the charts.

    Today's list includes Netscout Systems (NTCT), First Cash Financial Services (FCFS), Electronics For Imaging (EFII), Monotype Imaging(TYPE) and Analogic (ALOG):

    Netscout Systems (NTCT)

    Barchart technical indicators:

     

    • 100% Barchart technical buy signals
    • Trend Spotter buy signal
    • Above its 20, 50 and 100 day moving averages
    • 16 new highs and up 15.36% in the last month
    • Relative Strength Index 76.40%
    • Barchart computes a technical support level at 43.81
    • Recently traded at 45.03 with a 50 day moving average of 39.90


    First Cash Financial Services (FCFS)

    Barchart technical indicators:

     

    • 96% Barcaft technical buy signals
    • Trend Spotter buy signal
    • Above its 20, 50 and 100 day moving averages
    • 14 new highs and up 11.54% in the last month
    • Relative Strength Index 78.42%
    • Barchart computes a technical support level at 57.09
    • Recently traded t 58.28 with a 50 day moving average of 52.56


    Electronics For Imaging (EFII)

    Barchart technical indicators:

     

    • 88% Barchart technical buy signals
    • Trend Spotter buy signal
    • Above its 20, 50 and 100 day moving averages
    • 14 new highs and up 13.52% in the last month
    • Relative Strength Index 84.31%
    • Barchart computes a technical support level at 44.76
    • Recently traded at 46.31 with a 50 day moving average of 40.28


    Monotype Imaging (TYPE)

    Barchart technical indicators:

     

    • 80% Barchart short term buy signals
    • Trend Spotter buy signal
    • Above its 20, 50 and 100 day moving averages
    • 14 new highs and up 12.74% in the last month
    • Relative Strength Index 71.20%
    • Barchart computes a technical support level at 27.80
    • Recently traded at 29.02 with a 50 day moving average of 26.67


    Analogic (ALOG)

    Barchart technical indicators:

     

    • 80% Barchart short term buy signals
    • Trend Spotter buy signal
    • Above its 20, 50 and 100 day moving averages
    • 14 new highs and up 1532% in the last month
    • Relative Strength Index 66.75%
    • Barchart computes a technical support level at 77.04
    • Recently traded at 78.49 with a 50 day moving average f 74.59
    Tags: NTCT, FCFS, EFII, TYPE, ALOG
    Jul 02 10:31 AM | Link | Comment!
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