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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 9/12 0 comments
    Sep 12, 2013 2:56 PM | about stocks: HAL, LULU, WEN, SYMC, TLRD, VRTX, AMD, LDOS, AME, AAPL, NFLX, QCOM, RCL, VRA, KR, GWW, ATR, PGR, USB, ECL, DELL, MA, V, SSYS, ULTA, HRB

    Barchart Morning Call

    Thursday, September 12th, 2013View Older Reports

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    OVERNIGHT MARKETS AND NEWS

    September E-mini S&Ps (ESU13 unch) this morning are down -0.09% and European stocks are down by -0.17% after industrial output in the Eurozone fell by the most in 10-months. Asian stocks closed mixed: Japan -0.26%, Hong Kong +0.07%, China +0.99%, Taiwan +0.20%, Australia +0.16%, Singapore +0.41%, South Korea -0.02%, India -1.08%. Japanese stocks fell after Japanese core machinery orders, a proxy of future capital spending, unexpectedly stagnated in July, while China's Shanghai stock index rose to a 3-month high after Chinese Premier Li Keqiang said that China will push forward interest-rate and exchange-rate reforms and the internationalization of the yuan. Commodity prices are mixed. Oct crude oil (CLV13 +0.80%) is up +0.86% and Oct gasoline (RBV13 +1.50%) is up +1.42% after the Israeli army reported that two shells fired from Syria hit the southern Golan. Dec gold (GCZ13 -1.68%) is down -1.58% at a 4-week low on expectations for the Fed to taper QE at next week's FOMC meeting and Dec copper (HGZ13 -1.37%) is down -0.97% after Eurozone industrial production fell more than expected. Agricultural and livestock prices are mixed ahead of the Sep WASDE crop production report later this morning. The dollar index (DXY00 +0.01%) is up +0.02%. EUR/USD (^EURUSD) is down -0.12% and USD/JPY (^USDJPY) is down -0.53%. December T-note prices (ZNZ13 +0.18%) are up +7.5 ticks.

    Eurozone July industrial production fell -1.5% m/m and -2.1% y/y, weaker than expectations of -0.3% m/m and -0.2% y/y, with the -1.5% m/m decline the biggest monthly drop in 10-months.

    The German Aug wholesale price index fell -0.6% m/m, the sixth consecutive month wholesale prices have fallen, and dropped -1.7% y/y, the biggest annual decline in 3-3/4 years.

    Japan July machine orders were unch m/m and +6.5% y/y, weaker than expectations of +2.4% m/m and +7.7% y/y.

    U.S. STOCK PREVIEW

    Today's weekly initial unemployment claims report is expected to show an increase of +7,000 to 330,000, reversing part of last week's decline of -9,000 to 323,000. Meanwhile, continuing claims are expected to rise +9,000 to 2.960 million, more than reversing last week's decline of -43,000 to 2.951 million. The Treasury today will sell $13 billion in 30-year T-bonds, concluding this week's $66 billion coupon package. There are two of the Russell 1000 companies that report earnings today: Kroger (consensus $0.60), and Ulta Salon (0.67).

    Equity conferences during the remainder of this week include the following: UBS Global Paper & Forest Products Conference on Thu, UBS Best of Americas Conference on Thu-Fri, Bank of America Merrill Lynch Global Real Estate Conference on Wed-Fri, Bank of America Merrill Lynch Healthcare Conference on Wed-Thu, Goldman Sachs Global Commodities Conference on Wed-Thu, Bank of America Merrill Lynch Media, Communications & Entertainment Conference on Wed-Thu, Barclays Capital CEO Energy - Power Conference on Wed-Thu, Barclays CEO Energy Power Conference on Wed-Thu, CL King & Associates Inc Best Ideas Conference on Wed-Thu, Bank of America Merrill Lynch Canada Mining Conference on Thu, and Bloomberg Canadian Fixed Income Conference on Thu.

    OVERNIGHT U.S. STOCK MOVERS

    Halliburton (HAL -0.26%) was downgraded to "Neutral" from "Outperform" at Macquarie.

    lululemon (LULU -1.50%) slipped over 9% in pre-market trading after it reported Q2 EPS of 39 cents, better than consensus of 35 cents, but then lowered guidance on fiscal 2013 EPS view to $1.94-$1.97, below consensus $1.99.

    Wendy's (WEN +0.73%) was upgraded to "Buy" from "Hold" at Argus.

    Symantec (SYMC +0.12%) was downgraded to "Equal Weight" from "Overweight" at Morgan Stanley.

    Men's Wearhouse (MW -0.62%) slumped over 10% in after-hours trading after it reported Q2 EPS of $1.01, well below consensus of $1.14, and then lowered guidance on fiscal 2013 EPS view to $2.40-$2.50 from $2.70-$2.80, below consensus of $2.77.

    As of the September 20 close, Ametek (AME +0.41%) and Vertex (VRTX -1.86%) will be added to the S&P 500, while AMD (AMD -1.29%) and SAIC (SAI +2.07%) will be deleted and added to the S&P 400.

    Billionare investor Carl Icahn said he bought more Apple (AAPL -5.44%) stock Wednesday as the price fell and that he likes the Netflix (NFLX -1.52%) model and has not sold his shares.

    Qualcomm (QCOM -2.85%) announced a new $5 billion share repurchase program.

    Royal Caribbean (RCL +1.28%) raised its quarterly dividend to 25 cents per share from 12 cents per share.

    Vera Bradley (VRA +2.53%) tumbled 11% in after-hours trading after reported Q2 EPS of 37 cents, better than consensus of 32 cents, but then lowered guidance on fiscal 2014 EPS view to $1.47-$1.52 from $1.74-$1.78, below consensus of $1.71.

    MARKET COMMENTS

    Sep E-mini S&Ps (ESU13 unch) this morning are down -1.50 points (-0.09%). The S&P 500 index on Wednesday climbed to a 4-week high and closed higher. Bullish factors included (1) reduced threats of a U.S. military strike against Syria after President Obama asked Congress to delay a vote authorizing the use of military force while the administration pursues Russia's proposal that Syria gives up its chemical weapons, and (2) improved global economic prospects after the UK July unemployment rate unexpectedly fell to a 4-year low of 7.7%. Closes: S&P 500 +0.31%, Dow Jones +0.89%, Nasdaq 100 -0.16%.

    Dec 10-year T-notes (ZNZ13 +0.18%) this morning are up +7.5 ticks. Dec 10-year T-note prices on Wednesday shed early losses and closed higher on strong demand for the Treasury's $21 billion 10-year T-note auction that had a bid-to-cover ratio of 2.86, higher than the 12-auction average of 2.78. Prices had traded lower early on reduced safe-haven demand as the threat of any U.S. military strike against Syria faded when President Obama asked Congress to delay a vote on authorizing military force against Syria. Closes: TYZ3 +14.50, FVZ3 +9.75.

    The dollar index (DXY00 +0.01%) this morning is up +0.014 (+0.02%). EUR/USD (^EURUSD) is down -0.0016 (-0.12%) and USD/JPY (^USDJPY) is down -0.53 (-0.53%). The dollar index on Wednesday slipped to a 1-1/2 week low and closed lower. The dollar retreated on reduced safe-haven demand after President Obama postponed a decision on military attacks on Syria. Another negative for the dollar was the rally in the British pound to a 7-month high against the dollar after the UK unemployment rate unexpectedly fell to a 4-year low. Closes: Dollar index -0.303 (-0.37%), EUR/USD +0.00435 (+0.33%), USD/JPY -0.49 (-0.49%).

    Oct WTI crude oil (CLV13 +0.80%) this morning is up +93 cents (+0.86%) and Oct gasoline (RBV13 +1.50%) is up +0.0385 (+1.42%). Oct crude oil and gasoline prices on Wednesday settled mixed. A slide in the dollar index to a 1-1/2 week low boosted crude, while Oct gasoline tumbled to a 1-month low after weekly EIA gasoline stockpiles unexpectedly rose +1.658 million bbl, higher than estimates for a -1.0 million bbl decline. Another bearish factor for crude was the +1.6% increase in U.S. crude production in the week ended Sep 6 to a new 23-3/4 year high of 7.745 million barrels a day. Also, crude prices were pressured as the risk of a U.S. military strike in Syria receded when President Obama postponed a decision on military attacks on Syria. Closes: CLV3 +0.17 (+0.16%), RBV3 -0.0235 (-0.86%).

    GLOBAL EVENT CALENDAR09/12/2013

    US 0830 ET Weekly initial unemployment claims expected +7,000 to 330,000, previous -9,000 to 323,000. Weekly continuing claims expected +9,000 to 2.960 million, previous -43,000 to 2.951 million.
      0830 ET Aug import price index expected +0.5% m/m and +0.4% y/y, July +0.2% m/m and +1.0% y/y.
      0830 ET USDA weekly Export Sales.
      0900 ET New York Fed President William Dudley speaks on a panel in Paris at an event title Four years after Pittsburgh. What has OTC derivatives reform achieved so far?
      1100 ET Treasury announces amount of 10-year TIPS to be auctioned Sep 19.
      1200 ET Sep WASE crop production report.
      1300 ET Treasury auctions $13 billion 30-year T-bonds.
      1400 ET Aug monthly budget statement expected -$150.0 billion, July -$97.594 billion.
    GER 0200 ET German Aug wholesale price index, July -0.3% m/m and unch y/y.
    EUR 0400 ET ECB publishes monthly report.
      0500 ET Eurozone July industrial production expected -0.3% m/m and -0.2% y/y, Jun +0.7% m/m and +0.3% y/y.
    UK 0500 ET BOE Governor Mark Carney testifies to the U.S. Parliaments Treasury Committee on the BOEs Aug inflation report.

    U.S. STOCK CALENDAR09/12/2013

    Company Name Ticker Time Event Description Period Estimate
    Kroger Co/The KR US Bef-mkt Q2 2014 Earnings Release Q2 2014 0.595
    WW Grainger Inc GWW US 8:00 August 2013 Sales and Revenue Call 2013  
    WW Grainger Inc GWW US 8:00 August 2013 Sales and Revenue Release 2013  
    Aptargroup Inc ATR US 8:00 Analyst Day Y 2013  
    Progressive Corp/The PGR US 8:30 August 2013 Sales and Revenue Release 2013  
    US Bancorp/MN USB US 8:30 Investor Day Y 2013  
    Ecolab Inc ECL US 9:00 Investor Day - Morning Session Y 2013  
    Kroger Co/The KR US 10:00 Q2 2014 Earnings Call Q2 2014  
    Dell Inc DELL US 10:00 Extraordinary Shareholders Meeting - M&A Vote Y 2013  
    Mastercard Inc MA US 10:00 U.S. Credit-Card Swipe Fee Settlement Hearing    
    Visa Inc V US 10:00 U.S. Credit-Card Swipe Fee Settlement Hearing    
    Stratasys Ltd SSYS US 10:00 Extraordinary Shareholders Meeting Y 2013  
    Ulta Salon Cosmetics & Fragrance Inc ULTA US Aft-mkt Q2 2014 Earnings Release Q2 2014 0.666
    H&R Block Inc HRB US   Annual General Meeting  
    Stocks: HAL, LULU, WEN, SYMC, TLRD, VRTX, AMD, LDOS, AME, AAPL, NFLX, QCOM, RCL, VRA, KR, GWW, ATR, PGR, USB, ECL, DELL, MA, V, SSYS, ULTA, HRB
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