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BARCHART MORNING CALL 11/26

|Includes:ADI, CAL, CAR, CBRL, CHS, DSW, DY, EV, Fluor Corporation (FLR), HI, HPQ, HRL, JCP, JEC, MU, NUAN, PPL, RRC, SIG, TIF

BARCHART MORING CALL

Tuesday, November 26th, 2013View Older Reports

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OVERNIGHT MARKETS AND NEWS

December E-mini S&Ps (ESZ13 +0.07%) this morning are down -0.04% and European stocks are down -0.13% ahead of U.S. reports on consumer confidence and house prices. Asian stocks closed mostly lower: Japan -0.67%, Hong Kong -0.01%, China -0.05%, Taiwan +0.74%, Australia +0.08%, Singapore -0.22%, South Korea +0.40%, India -0.87%. Commodity prices are mixed. Jan crude oil (CLF14 +0.24%) is up +0.26% and Jan gasoline (RBF14 -0.03%) is down -0.03%. Dec gold (GCZ13 +0.46%) is up +0.83%. Dec copper (HGZ13 -0.03%) is up +0.03%. Agricultural and livestock prices are mixed. The dollar index (DXY00 -0.23%) is down -0.23%. EUR/USD (^EURUSD) is up +0.21% after ECB Executive Board member Coeure said the ECB doesn't see deeper disinflation. USD/JPY (^USDJPY) is down -0.27%%. December T-note prices (ZNZ13 +0.15%) are up +5.5 ticks.

The minutes of the Oct 31 BOJ policy meeting showed some members saw the risks to economic activity and prices as tilted to the downside on the whole. BOJ member Shirai proposed adding "attention should be paid to downside risks" to the bank's outlook as "there was a high degree of uncertainty regarding developments in overseas economies and households' employment and income situation."

The Japan Oct corporate service price index rose +0.8% y/y, a smaller gain than expectations of +0.9% y/y, but still the biggest increase in 5-years.

ECB Executive Board member Coeure said the ECB doesn't "see it as a very likely prospect that disinflation would deepen, would worsen in the Eurozone as growth recovers, which is our main scenario."

U.S. STOCK PREVIEW

Today's U.S. home price indexes are both expected to show solid increases to new 5-year highs, illustrating that U.S home prices continue to move higher despite headwinds from the 1 point increase in mortgage rates during mid-year and the recent sharp drop in U.S. consumer confidence thanks to the U.S. government shutdown. Today's Sep S&P/CaseShiller composite-20 home price index is expected to show increases of +0.90% m/m and +13.00% y/y, which would be close to the August report of +0.93% m/m and +12.82% y/y. Meanwhile, the Sep FHFA house price index is expected to show a smaller increase of +0.4% m/m following the +0.3% m/m increase in August. Today's Nov U.S. consumer confidence index from the Conference Board is expected to show a +1.3 point increase to 72.5, recovering a small portion of the -9.0 point plunge to 71.2 seen in October. Today's Nov Richmond Fed manufacturing index is expected to show a +3 point increase to 4, adding to the small +1 point increase to 1 seen in October. The Treasury today will sell $35 billion in 5-year T-notes. The Treasury will then conclude this week's $96 billion T-note package by selling $29 billion of 7-year T-notes on Wednesday.

There are 5 of the S&P 500 companies that report earnings today: Tiffany (consensus $0.58), Hormel (0.54), Pall Corp (0.68), Analog Devices (0.58), HP (1.00). Equity conferences this week include the 12th Annual World Drug Manufacturing Summit 2013 on Tue-Wed.

OVERNIGHT U.S. STOCK MOVERS

Cracker Barrel (CBRL +1.07%) reported Q1 adjusted EPS of $1.22, better than consensus of $1.13.

Brown Shoe (BWS +1.05%) raised guidance on fiscal 2013 adjusted EPS view to $1.36-$1.40, higher than consensus of $1.36.

Pall Corp. (PLL -1.27%) reported Q1 EPS of 70 cents, higher than consensus of 68 cents.

Tiffany (TIF -0.11%) reported Q3 EPS of 73 cents, well above consensus of 58 cents, and then raised guidance on its fuscal 2014 EPS view to to $3.65-$3.75 from $3.50-$3.60, better than consensus of $3.62.

Hormel Foods (HRL -1.07%) reported Q4 EPS of 58 cents, better than consensus of 54 cents.

Nuance (NUAN -2.32%) tumbled over 7% in after-hours trading after it lowered guidance on fiscal 2014 EPS to $1.05-$1.15, well below consensus of $1.41.

J.C. Penney (JCP +3.61%) rose over 2% in after-hours trading after a regulatory filing showed that CEO Myron Ullman bought 112,000 shares of JCP stock on 11/22/13.

Hillenbrand (HI +0.92%) reported Q4 EPS of 50 cents, below consensus of 52 cents, and then lowered guidance on fiscal 2014 EPS to $2.00-$2.10, below consensus of $2.15.

Dycom (DY -2.27%) reported Q1 EPS of 54 cents, well above consensus of 46 cents.

Greenlight Capital discloses holding 23.02 million shares of Micron (MU -1.63%) in an amended 13F statement.

Blue Ridge Capital reported a 6.17% passive stake in Avis Budget (CAR +1.33%) .

MARKET COMMENTS

Dec E-mini S&Ps (ESZ13 +0.07%) this morning are down -0.75 of a point (-0.04%). The S&P 500 index on Monday posted a fresh all-time high but closed little changed. Bullish factors for stocks included (1) carry-over strength from a rally in European stocks on dovish comments from ECB Governing Council member Hansson who said the ECB stands ready to cut interest rates further, and (2) strength in airlines and transportation stocks after crude prices fell when Iran agreed to limit its nuclear program. Stocks fell back from their best levels after U.S. Oct pending home sales unexpectedly fell -0.6% m/m, the fifth consecutive monthly decline and below expectations of a +1.0% m/m increase. Closes: S&P 500 -0.13%, Dow Jones +0.05%, Nasdaq 100 +0.16%.

Dec 10-year T-notes (ZNZ13 +0.15%) this morning are up +5.5 ticks. Dec T-notes Monday closed higher after Oct pending home sales unexpectedly declined, which bolstered speculation the Fed will maintain its pace of bond buying into next year. Gains were limited on reduced safe-haven demand after Iran agreed to limit its nuclear program and after the S&P 500 rose to a new record high. Closes: TYZ3 +3.00, FVZ3 +1.50.

The dollar index (DXY00 -0.23%) this morning is down -0.184 (-0.23%). EUR/USD (^EURUSD) is up +0.0029 (+0.21%) and USD/JPY (^USDJPY) is down -0.27 (-0.27%). The dollar index on Monday closed higher. EUR/USD moved lower on dovish comments from ECB Governing Council member Hansson who said the ECB stands ready to cut interest rates further and is prepared to make the deposit rate negative. USD/JPY surged to a 5-3/4 month high after Iran's accord with the major world powers to curb its nuclear activities reduced the safe-haven demand for the yen. Closes: Dollar index +0.212 (+0.26%), EUR/USD -0.00414 (-0.31%), USD/JPY +0.394 (+0.39%).

Jan WTI crude oil (CLF14 +0.24%) this morning is up +24 cents (+0.26%) and Jan gasoline (RBF14 -0.03%) is down -0.0007 (-0.03%). Jan crude oil and gasoline prices on Monday closed lower. Bearish factors included (1) reduced Middle East tensions after Iran agreed with the major world powers to curb its nuclear activities, and (2) the rally in the dollar index. Closes: CLF4 -0.75 (-0.79%), RBF4 -0.0375 (-1.38%).

GLOBAL EVENT CALENDAR11/26/2013

US 0830 ET Oct building permits expected +0.4% to 930,000 (Sep postponed), Aug 926,000. Housing starts report will be delayed until Dec 18 due to government shutdown.
  0900 ET Sep S&P/CaseShiller composite-20 home price index expected +0.90% m/m and +13.00% y/y, Aug +0.93% m/m and +12.82% y/y.
  0900 ET Sep FHFA house price purchase only index expected +0.4% m/m, Aug +0.3% m/m. Q3 FHFA house price purchase only index expected +2.0% q/q, Q2 +2.10% q/q.
  1000 ET Nov Richmond Fed manufacturing index expected +3 to 4, Oct +1 to 1.
  1000 ET U.S. Nov consumer confidence (Conference Board) expected +1.3 to 72.5, Oct -9.0 to 71.2.
  1300 ET Treasury auctions $35 billion 5-year T-notes.
  1630 ET API weekly U.S. oil statistics.
EUR 0730 ET ECB Council member Ives Mersch is keynote speaker at a conference in Frankfurt titled Economic and Legal Limits of Central Banking.

U.S. STOCK CALENDAR11/26/2013

Company Name Ticker Time Event Description Period Estimate
Range Resources Corp RRC US 1:00 Annual General Meeting Y 2013  
Hormel Foods Corp HRL US Bef-mkt Q4 2013 Earnings Release Q4 2013 0.542
Tiffany & Co TIF US Bef-mkt Q3 2014 Earnings Release Q3 2014 0.58
Chico's FAS Inc CHS US Bef-mkt Q3 2014 Earnings Release Q3 2014 0.245
Pall Corp PLL US 7:00 Q1 2014 Earnings Release Q1 2014 0.68
Signet Jewelers Ltd SIG US 7:00 Q3 2014 Earnings Release Q3 2014 0.423
DSW Inc DSW US 7:00 Q3 2014 Earnings Release Q3 2014 0.58
Jacobs Engineering Group Inc JEC US 8:00 FY 2014 Guidance Call Y 2014  
Tiffany & Co TIF US 8:30 Q3 2014 Earnings Call Q3 2014  
Pall Corp PLL US 8:30 Q1 2014 Earnings Call Q1 2014  
Chico's FAS Inc CHS US 8:30 Q3 2014 Earnings Call Q3 2014  
DSW Inc DSW US 8:30 Q3 2014 Earnings Call Q3 2014  
Hormel Foods Corp HRL US 9:00 Q4 2013 Earnings Call Q4 2013  
Eaton Vance Corp EV US 9:00 Q4 2013 Earnings Release Q4 2013 0.596
Signet Jewelers Ltd SIG US 9:00 Q3 2014 Earnings Call Q3 2014  
Analog Devices Inc ADI US Aft-mkt Q4 2013 Earnings Release Q4 2013 0.582
Hewlett-Packard Co HPQ US Aft-mkt Q4 2013 Earnings Release Q4 2013 0.999
Stocks: FLR, CBRL, CAL, PPL, TIF, HRL, NUAN, JCP, HI, DY, MU, CAR, RRC, CHS, SIG, DSW, JEC, EV, ADI, HPQ