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Jim Van Meerten
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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 11/5 0 comments
    Nov 6, 2012 12:26 PM | about stocks: CVS, NWSA, EMR, DTV, DISCA, MRO, MMC, SRE, DISH, HCN, LMCA, RAX, CPN, EXPO, CHTR, OAK, NYX, SCG, DNR, D, FOSL

    Barchart Morning Call

    BC - Tue Nov 06, 7:00AM CST

    Overnight Developments

    • Dec E-mini S&Ps this morning are mildly higher by +0.32% going into today's election with support from today's +0.70% rally in European stocks. European stocks have been able to shake off today's generally weak European economic data. The big Asian stock markets closed lower today with Japan down -0.36%, Hong Kong down -0.28%, and China down -0.42%. Commodity prices are trading higher almost across the board today and are up by an average +0.52%. Dec crude oil is up +0.69%, Dec gasoline is up +1.03%, Dec gold is up +0.57%, Dec copper is up +0.45%, and agriculture prices are all trading higher. The dollar index is slightly lower by -0.08 points (-0.09%) and EUR/USD is up +0.0006 (+0.05%). Dec 10-year T-note prices are down -4 ticks.
    • The markets are waiting to assess the outcome of today's U.S. election, which will at least significantly reduce the uncertainty level for the markets. The first big news will be available when polls close in key eastern states at 8 PM ET. The markets are hoping for a decisive election outcome by late tonight or the early morning hours. The markets hoping that the decision isn't delayed by recounts or court challenges that would cause substantial uncertainty and could even delay the results by a matter of days.
    • Greek workers began a 48-hour general strike today to protest austerity measures. Meanwhile, doubts continue about whether the Greek parliament will be able to approve the 13.5 billion euro austerity package that is required for Greece to receive its next tranche of bailout aid. European Union Economic and Monetary Affairs Commissioner Olli Rehn said yesterday that the target for a Greek deal is an EU finance ministers meeting this coming Monday (Nov 12), although target that could easily slip since Eurozone officials still haven't decided how to plug the 30 billion euro hole in Greece's long-term deficit reduction plan. Greek Prime Minister Samaras submitted the austerity bill to parliament late Monday. The Greek parliament is expected to vote on the plan on Wednesday and then vote on the budget on Sunday (Nov 11).
    • The Australian central bank today left its overnight cash rate target unchanged at 3.25% versus some market hopes for a rate cut. The bank cited a more stable global economy as the reason for leaving its rate unchanged. AUD/USD is up +0.64% today on the lack of a rate cut.
    • Germany's final-Oct services PMI was revised lower by -0.9 points to 48.4 from the early-Oct level of 49.3, leaving the index down by 1.3 points from the Sep level of 49.7. The final-Oct Eurozone services PMI was revised slightly lower by -0.2 points to 46.0 from the early-Oct level of 46.2, leaving the index down by -0.1 point from Sep's level of 46.1.
    • German Sep factory orders fell by -3.3% m/m and -4.7% y/y, which was weaker than market expectations of -0.4% m/m and -1.5% y/y.
    • UK Sep industrial production fell -1.7% m/m and -2.6% y/y, which was weaker than market expectations of -0.6% m/m and -1.6% y/y. The UK Sep manufacturing production report of +0.1% m/m and -1.0% y/y was weaker than market expectations of +0.4% m/m and -0.8% y/y.
    • The Eurozone Sep PPI report of +0.2% m/m and +2.7% y/y was in line with market expectations. Market Comments
      • Dec E-mini S&Ps this morning are up +4.50 points (+0.32%) on the +0.70% rally in the Euro Stoxx 50 index this morning. Otherwise, stock investors are simply holding their ground ahead of today's election results. The S&P 500 index on Monday closed mildly higher: S&P 500 +0.22%, Dow Jones +0.15%, Nasdaq +0.63%. The U.S. stock market on Monday was boosted by some short-covering after last Friday's sharp sell-off. The Nasdaq received a boost from a 1.4% rally in Apple after news it sold 3 million of its iPad mini on its debut weekend. U.S. stocks were undercut by the news that the U.S. Oct ISM non-manufacturing index fell by -0.9 points to 54.2, which was mildly weaker than market expectations for a -0.6 point drop to 54.5.
      • Dec 10-year T-notes this morning are down 4 ticks on today's higher trade in the U.S. and European stock indexes.. Dec 10-year T-note prices on Monday closed moderately higher: TYZ2 +11.5, FVZ2 +4.75. Bullish factors included some safe-haven demand ahead of the election and with increased concerns about Greece. The T-note market shook off supply overhang concerns ahead of the $72 billion refunding operation that begins Tuesday with the Treasury's sale of $35 billion in 3-year T-notes.
      • The dollar index this morning is slightly lower by -0.08 points (-0.09%) on reduced safe-haven demand with the mildly higher trade in E-mini S&Ps. EUR/USD is up +0.0006 (+0.05%) and USD/JPY is down -0.12 (-0.15%). The dollar index on Monday closed mildly higher: Dollar index +0.11 (+0.13%), EUR/USD -0.0039 (-0.30%), USD/JPY -0.14 (-0.17%). Bullish factors included (1) some safe-haven demand ahead of Tuesday's U.S. election, (2) weakness in EUR/USD on worries about whether the Greek parliament will be able to approve the 13.5 billion euro austerity package that is necessary for Greece to obtain its next 31.5 billion euro tranche of aid and stay in the Eurozone, and (3) some technical strength in the dollar index with the rally to a new 2-mont high and technical weakness in EUR/USD with the new 2-month low.
      • Dec WTI crude oil prices this morning are up +0.59 (+0.69%) and Dec gasoline is up +0.0271 (+1.03%). Dec crude oil and gasoline prices on Monday closed higher: CLZ2 +0.79 (+0.93%), RBZ2 +0.0466 (+1.81%). Bullish factors include (1) pent-up demand for fuel in Northeastern U.S. with refineries slowly getting back to normal, and (2) news of a temporary shut-down of Valero's Port Arthur, Texas refinery after a fire. Israeli Prime Minister Netanyahu said yesterday that if he wins another term as Prime Minister at Israel's election in January, Iran's nuclear program will no longer exist by the end of his term. The market consensus for Wednesday's DOE report is for a +1.5 million barrel rise in crude oil inventories, a -1.5 million barrel drop in gasoline inventories, a -1.25 million barrel drop in distillate inventories, and a -1.5 point drop in the refinery utilization rate to 86.2% of capacity.
      • For the complete subscription version of this daily report (plus a 13-page big-picture weekly report), along with the earliest possible delivery in the morning, please visit http://www.barchart.com/register/crbfms_usmc.php Today's U.S. Earnings Reports

        Earnings reports (ranked by market cap): CVS-CVS Caremark (Consensus:$0.84), NWSA-News Corp (0.37), EMR-Emerson (1.05), DTV-DirectTV (0.92), DISCA-Discovery Communications (0.63), MRO-Marathon Oil (0.65), MMC-Marsh & McLennan (0.38), SRE-Sempra Energy (1.00), DISH-Dish Network (0.56), HCN-Health Care REIT (0.26), LMCA-Liberty Media (0.94), RAX-Rackspace Hosting (0.19), CPN-Calpine (0.41), EXPD-Expeditors (0.43), CHTR-Charter Communications (-0.33), OAK-Oaktree Capital (0.74), NYX-NYSE Euronext (0.41), SCG-Scana (0.89), DNR-Denbury Resource (0.33), DOX-Amdocs (0.70), FOSL-Fossil (1.16).

        Global Financial Calendar

        Global Calendar - Tuesday 11/6/12
        United States
        n/aU.S. Election Day.
        0745 ETICSC (Int'l Council of Shopping Centers) weekly retailer sales.
        0855 ETRedbook weekly retailer sales.
        1130 ETWeekly 4-week T-bill auction.
        1300 ETTreasury auctions $32 billion in 3-year T-notes.
        1630 ETAPI weekly U.S. oil statistics.
        Japan
        0000 ETJapan Sep coincident index expected 91.2, Aug 93.5. Sep leading index expected 91.8, Aug 93.2.
        Germany
        0355 ETGerman final-Oct services PMI expected unch from prelim of 49.3.
        0600 ETGerman Sep factory orders expected -0.5% m/m and -1.5% y/y, Aug -1.3% m/m and -4.8% y/y.
        Euro-Zone
        0400 ETEurozone final-Oct services PMI expected unch from prelim 46.2. Final-Oct composite PMI expected unch from prelim 45.8.
        0500 ETEurozone Sep PPI expected +0.2% m/m and +2.6% y/y, Aug +0.9% m/m and +2.7% y/y.
        United Kingdom
        0430 ETUK Sep industrial production expected -0.6% m/m and -1.6% y/y, Aug -0.5% m/m and -1.2% y/y. Sep manufacturing production expected +0.4% m/m and -0.8% y/y, Aug -1.1% m/m and -1.2% y/y.
        1000 ETUK Oct NIESR GDP estimate, previous +0.8%.
        1901 ETUK Oct BRC shop price index, Sep +1.0% y/y.

        Barchart.com provides Financial Quotes, Charts and Technical Analysis for Stock and Commodity Traders.

    Stocks: CVS, NWSA, EMR, DTV, DISCA, MRO, MMC, SRE, DISH, HCN, LMCA, RAX, CPN, EXPO, CHTR, OAK, NYX, SCG, DNR, D, FOSL
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