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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 and Seeking Alpha. He earned a BS in Accounting and Business Administration from Berry College; a Juris Doctorate from the Woodrow Wilson School of Law; and... More
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  • Barchart Morning Call 2/22 0 comments
    Feb 27, 2013 4:14 PM | about stocks: DLTR, TGT, NRG, PZZA, EIX, FSLR, RRC, PCLN, AH, CZR, BYD, ZNGA, AES, JOY, CNP, TJX, VNO, DE, AAPL, JCP, LB, MYL, MNST, DLLR
    Barchart Morning Call

    BC - Wed Feb 27, 6:55AM CST

    OVERNIGHT MARKETS AND NEWS
    March E-mini S&Ps (ESH13 +0.15%) this morning are slightly higher by +0.08% with support from a +0.44% rally in European stocks on an improvement in Eurozone confidence indexes and successful Italian bond auctions. Japanese stocks today closed down -1.27% but all the other major Asian stock markets closed higher. Hong Kong closed +0.25% and China closed +1.06%. Commodity prices this morning are slightly lower by-0.10%. April crude (CLJ13 +0.06%) oil is up +0.29%, April gasoline (RBJ13-0.07%) up +0.03%, April gold (GCJ13 -0.56%) is down -0.60%, March copper is down -0.27%, and agriculture prices are mixed. The dollar index (DXY00 -0.30%) is down -0.29% as risk concerns have eased a bit with today's successful Italian debt auctions. EUR/USD (^EURUSD) is up +0.33% and USD/JPY (^USDJPY) is down -0.33%. March 10-year T-note (ZNH13+0.09%) prices are up 3.5 ticks.
    2-day nuclear talks between world powers and Iran ended today with talks scheduled to resume. Technical talks will be held in Istanbul on March 18 and political talks will be held in Kazakhstan on April 5. Iran's negotiator said this week's talks represented a "turning point" and he said that world powers made a "more realistic and logical" proposal. The details of the proposal were not made public.
    The Eurozone Feb economic confidence index rose to 91.1 from a revised 89.5 in Jan and was stronger than market expectations of 89.9. The Eurozone Feb business climate index rose to -0.73 from -1.09 in Jan and was stronger than market expectations for just a small increase to -1.02.The Eurozone Feb industrial confidence index rose to -11.2 from a revised-13.8 in Jan and was stronger than market expectations of -13.1.Eurozone Feb services confidence rose to -5.4 from a revised -7.7 in Jan and was stronger than market expectations of -8.8. The Eurozone Feb consumer confidence index was left unrevised at -23.6.
    Italy today was able to successfully sell 2.5 billion euros of 5-year bonds and 4 billion euros of 10-year bonds despite Monday's muddled election results, which allowed Italian 10-year bond yields to fall several basis points.
    The Japan Jan retail trade report of +2.3% m/m and -1.1% y/y was stronger than market expectations of +0.9% m/m and -1.5% y/y. However, Japan Jan large retailer sales fell -3.5% y/y, which was weaker than market expectations of -0.8%.
    German March GfK consumer confidence rose by +0.1 point to 5.9 from 5.8 in Feb, which was slightly stronger than market expectations for a report of unchanged.
    UK Q4 GDP was left unrevised at -0.3% q/q although on a year-on-year basis UK GDP was revised higher to +0.3% from unchanged.

    U.S. STOCK PREVIEW
    Fed Chairman Bernanke today will appear before the House Financial Services Committee in the second day of his semi-annual testimony. He will present the same prepared remarks although the Q&A period will obviously be different. Today's Jan pending home sales report is expected to show a +2.0% increase after the -4.3% decline seen in December. Jan durable goods orders today are expected to show a decline of -4.8% to more than reverse December's +4.3% increase, while durable goods ex-transportation are expected at -0.3% m/m after the +1.0% m/m increase in December. The Treasury today will sell $29 billion in 7-year T-notes to conclude this week's $99 billion T-note package.
    There are 12 of the S&P 500 companies that report earnings today. Notable reports include Target (consensus $1.48), TJX (0.81), JC Penney (-0.24), Ltd Brands (1.74), Pall Corp (0.66), and Dollar Tree (0.99).

    March E-mini S&Ps (ESH13 +0.15%) this morning are slightly higher by +1.25 points (+0.08%) on support from a rally in European stocks. The S&P 500 index on Tuesday managed to stage a fairly solid recovery after Monday's sharp -1.83% loss on the Italian election results and Friday's upcoming sequester. Bullish factors on Tuesday centered on Mr. Bernanke's strong defense of QE3 and much stronger-than-expected U.S. economic data including Feb U.S. consumer confidence (+11.2 points), Jan new home sales (+15.6%), and Feb Richmond Fed manufacturing index (+18 to 6). Closes: S&P 500 +0.61%, Dow Jones +0.84%, Nasdaq +0.45%.

    OVERNIGHT U.S. STOCK MOVERS

    • Dollar Tree (DLTR +0.64%) reported Q4 EPS of $1.01, higher than the consensus of 99 cents.
    • Target (TGT +1.84%) reported Q4 adjusted EPS of $1.65, well above the consensus of $1.48.
    • NRG Energy (NRG +0.76%) reported Q4 EPS of $2.06 with items versus the consensus for a 15 cent loss.
    • Papa John's (PZZA +1.14%) fell in after-hours trading after announcing that it would restate its last four years of financial statements due a change in accounting for joint ventures.
    • Edison International (EIX +0.37%) rallied 4% in after-hours trading after reporting Q4 core EPS of $1.79.
    • First Solar (FSLR -4.22%) fell sharply by 10% in after-hours trading on disappointing Q1 guidance of 70-90 cent vs the consensus of 94 cents, although Q4 EPS of $2.04 was well above the consensus of $1.76.
    • Range Resources (RRC +1.26%) reported Q4 adjusted EPS of 46 cents, much better than the consensus of 29 cents.
    • Priceline.com (PCLN +1.03%) rallied 3.5% in after-hours trading after reporting Q4 adjusted EPS of $6.77, sell above the consensus of $6.54.
    • Accretive Health (AH +0.92%) fell nearly 20% after saying it would postpone Q4 and FY2012 results due to an evaluation of revenue recognition practices.
    • NJ Governor Christie late yesterday signed an Internet gaming bill into law, providing support for some selected gaming stocks such as Caesar's Entertainment (CZR +3.59%), Boyd Gaming (BYD +0.62%), and Zynga (ZNGA -2.04%).

    MARKET COMMENTS
    March 10-year T-notes this morning are up +3.5 ticks on continued safe-haven demand ahead of Friday's sequester. March 10-year T-note prices on Tuesday managed to continue higher despite the rally in stocks as the T-note market continues to see support ahead of Friday's sequester. Closes: TYH3 +5.5, FVH3 +1.75.
    The dollar index this morning is down -0.24 points on reduced safe-haven demand. EUR/USD is up +0.0043 (+0.33%) on the stronger-than-expected Eurozone confidence indexes and on the successful Italian bond auctions. USD/JPY is down -0.30 (-0.33%). The dollar index on Tuesday edged to another new 6-month high and closed mildly higher on continued worries about possible new turmoil in Europe and Friday's U.S. sequester even though the rally in stocks toned down risk concerns a bit. USD/JPY continued to see some strength on Monday's reports that Prime Minister Abe will choose Haruhiko Kuroda as the new BOJ chief. Closes: Dollar index +0.20 (+0.24%), EUR/USD -0.0002 (-0.02%), USD/JPY +0.16 (+0.17%).
    April WTI crude oil this morning is up +0.27 (+0.29%) and April gasoline is up +0.0011 (+0.03%). Crude oil and gasoline prices closed lower on Tuesday mainly due to continued heavy long liquidation pressure with the new 2-month low in crude oil and 3-week low in gasoline. Another bearish factor is market expectations for a 2.5 million bbl increase in crude oil inventories in today's weekly DOE report, although yesterday's API report showed an increase of only +904,000. Closes: CLJ3 -0.48 (-0.52%), RBJ3 -0.0648 (-1.99%).

    GLOBAL EVENT CALENDAR02/27/2013

    US0700 ETWeekly MBA mortgage applications, previous -1.7% with purchase sub-index -1.7% and refi sub-index -1.6%.
     0830 ETJan durable goods orders expected -4.8%, Dec +4.3% m/m. Jan durable ex-transportation orders expected -0.3%m/m, Dec +1.0% m/m. Jan non-defense capital goods orders ex-aircraft, Dec +0.2% m/m.
     1000 ETJan pending home sales index expected +2.0% m/m, Dec-4.3% m/m and +4.9% y/y.
     1000 ETFed Chairman Ben Bernanke delivers semi-annual testimony on monetary policy to House Financial Services Committee.
     1030 ETDOE Weekly Petroleum Status Report.
     1300 ETTreasury auction of $29 billion in 7-year T-notes.
     1630 ETDallas Fed President Richard Fisher speaks on the economy and monetary policy at Columbia University?s Spring 2013 Distinguished Speaker in International Finance and Economic Policy.
    GER0200 ETGerman Mar GfK consumer confidence survey expected +5.9, Feb 5.8.
     0200 ETGerman Jan import price index expected +0.5% m/m and-0.4% y/y, Dec -0.5% m/m and +0.3% y/y.
    EUR0400 ETEurozone Jan M3 money supply expected +3.2% y/y, Dec +3.3% y/y.
     0500 ETEurozone Feb economic confidence, Jan 89.2. Feb business climate indicator, Jan -1.09. Final Feb consumer confidence.
    UK0430 ETU.K. Q4 GDP expected unrevised from -0.3% q/q and unchanged y/y.
     0430 ETU.K. Dec index of services, Nov unchanged m/m and +0.6% 3-mo/3-mo.
     1901 ETU.K. Feb GfK consumer confidence survey, Jan -26.
    JPN1815 ETJapan Feb Markit/JMMA manufacturing PMI, Jan 47.7.
     1850 ETJapan Jan industrial production, Dec +2.4% m/m and -7.9%y/y.
     2300 ETJapan Jan vehicle production, Dec -17.2% y/y.
    CHI2035 ETChina Feb MNI business sentiment indicator.

    U.S. STOCK CALENDAR02/27/2013

    Company NameSymbolTimeEvent DescriptionPeriodEPS Est (US$)
    NRG Energy IncNRG USBef-mktQ4 2012 Earnings ReleaseQ4 2012-0.124
    AES Corp/VAAES US6:00Q4 2012 Earnings ReleaseQ4 20120.3
    Joy Global IncJOY US6:00Q1 2013 Earnings ReleaseQ1 20131.145
    Target CorpTGT US7:30Q4 2013 Earnings ReleaseQ4 20131.48
    CenterPoint Energy IncCNP US8:15Q4 2012 Earnings ReleaseQ4 20120.21
    Dollar Tree IncDLTR US9:00Q4 2013 Earnings CallC4 2013 
    NRG Energy IncNRG US9:00Q4 2012 Earnings CallQ4 2012 
    Range Resources CorpRRC US9:00Q4 2012 Earnings CallQ4 2012 
    TJX Cos IncTJX US9:30Q4 2013 Earnings ReleaseQ4 20130.808
    Vornado Realty TrustVNO US10:00Q4 2012 Earnings CallQ4 2012 
    AES Corp/VAAES US10:00Q4 2012 Earnings CallQ4 2012 
    Target CorpTGT US10:30Q4 2013 Earnings CallQ4 2013 
    Deere & CoDE US11:00Annual General Meeting  
    TJX Cos IncTJX US11:00Q4 2013 Earnings CallQ4 2013 
    Joy Global IncJOY US11:00Q1 2013 Earnings CallQ1 2013 
    CenterPoint Energy IncCNP US11:30Q4 2012 Earnings CallQ4 2012 
    Apple IncAAPL US12:00Annual General MeetingY 2013 
    JC Penney Co IncJCP US16:30Q4 2013 Earnings ReleaseQ4 2013-0.24
    Ltd Brands IncLTD US16:30Q4 2013 Earnings ReleaseQ4 20131.736
    Mylan Inc/PAMYL US17:00Q4 2012 Earnings CallQ4 2012 
    JC Penney Co IncJCP US17:00Q4 2013 Earnings CallQ4 2013 
    Monster Beverage CorpMNST US17:00Q4 2012 Earnings CallQ4 2012 
    Pall CorpPLL US17:00Q2 2013 Earnings ReleaseQ2 20130.663
    Mylan Inc/PAMYL USAft-mktQ4 2012 Earnings ReleaseQ4 20120.636
    Monster Beverage CorpMNST USAft-mktQ4 2012 Earnings ReleaseQ4 20120.411
    Dollar Tree IncDLTR US Q4 2013 Earnings ReleaseQ4 20130.988

    Stocks: DLTR, TGT, NRG, PZZA, EIX, FSLR, RRC, PCLN, AH, CZR, BYD, ZNGA, AES, JOY, CNP, TJX, VNO, DE, AAPL, JCP, LB, MYL, MNST, DLLR
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