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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 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 12/19 0 comments
    Dec 19, 2013 12:48 PM | about stocks: DRI, RAD, ELY, PIR, ACN, TGT, TRLA, AKS, DE, JPM, ORCL, MLHR, PAYX, CAG, CCE, LPS, NKE, TIBX, CTAS, RHT


    Thursday, December 19th, 2013View Older Reports

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    March E-mini S&Ps (ESH14 -0.01%) this morning are down -0.10% and European stocks are up +1.41%. Asian stocks closed mixed: Japan +1.74%, Hong Kong -1.10%, China -1.05%, Taiwan +0.70%, Australia +2.08%, Singapore +0.28%, South Korea +0.08%, India -0.73%. U.S. stocks fell back slightly after Wednesday's sharp rally while European stocks played catch-up to yesterday's late-afternoon surge in U.S. stocks after the Fed's decision to taper QE3 boosted confidence in the U.S. economic recovery. China's Shanghai Stock Index slid to a 1-month low after the 7-day repurchase rate, a gauge of funding availability in the banking system, jumped +140 bp to a 5-3/4 month high of 6.60%, which fueled concern that higher funding costs will hurt economic growth. Japan's Nikkei Stock Index climbed to a 6-3/4 month high as exporter stocks rallied after the yen tumbled to a 5-year low against the dollar. Commodity prices are mixed. Jan crude oil (CLF14 +0.03%) is down -0.04%. Jan gasoline (RBF14 +0.25%) is down -0.18%. Feb gold (GCG14 -2.51%) is down -2.27% at a 5-3/4 month low after the Fed's decision to cut its monthly bond purchases reduces demand for gold as an inflation hedge. March copper (HGH14 -0.65%) is down -0.69%. Agriculture and livestock prices are mixed. The dollar index (DXY00 +0.55%) is up +0.48% at a 2-week high. EUR/USD (^EURUSD) is up +0.01% and USD/JPY (^USDJPY) is down -0.17%. March T-note prices (ZNH14 -0.38%) are down -10.5 ticks.

    UK Nov retail sales ex autos rose +0.4% m/m, better than expectations of +0.3% m/m, and on an annual basis rose +2.3% y/y, less than expectations of +2.4% y/y. Nov retail sales including autos rose +0.3% m/m, right on expectations, and on an annual basis rose +2.0% y/y, less than expectations of +2.2% y/y.

    Japan Nov nationwide department store sales rose +2.4% y/y as they recovered from the -0.6% y/y decline in Oct.

    The Japan Oct leading index CI was revised down to 109.8 from the originally reported 109.9, and the Oct coincident index was revised up to a 5-1/4 year high of 110.4 from the originally reported 109.6.

    The Japan Oct all-industry activity index fell -0.2% m/m, less than expectations of -0.3% m/m, and Sep was revised higher to +0.5% m/m from the originally reported +0.4% m/m.


    Today's weekly initial unemployment claims report is expected to show a decline of -33,000 to 335,000, reversing about one-half of last week's surge of +68,000 to 368,000. Meanwhile, today's continuing claims report is expected to show a decline of -21,000 to 2.770 million, reversing about one-half of last week's increase of +40,000 to 2,791 million. Today's Nov existing home sales report is expected to show a decline of -2.0% to 5.02 million, adding to the -3.2% decline seen in October to 5.12 million. Today's Dec Philadelphia Fed manufacturing index is expected to show a +3.5 point increase to 10.0, partially recovering after the -13.3 point decline to 6.5 seen in November. Today's Nov leading indicators report is expected to show a strong increase of +0.7%, adding to the +0.2% increase seen in October. The Treasury today will $29 billion of 7-year T-notes and $16 billion of 5-year TIPS, concluding this week's $112 billion coupon package.

    There are 8 of the Russell 1000 companies that report earnings today: Darden Restaurants (consensus $0.20), Accenture (1.09), ConAgra Foods (0.55), NIKE (0.58), Cintas (0.68), Red Hat (0.35), TIBCO (0.39), Carnival (0.00). There are no equity conferences during the remainder of the week.


    Darden (DRI +1.13%) reported Q2 EPS of 15 cents, well below consensus of 20 cents, and said it sees fiscal 2014 EPS down 15%-20% compared to 2013.

    Rite Aid (RAD +1.41%) said it sees fiscal 2014 EPS of 17 cents-23 cents, below consensus of 24 cents.

    Callaway Golf (ELY +0.63%) was upgraded to 'Strong Buy' from 'Outperform' at Raymond James.

    Pier 1 Imports (PIR -0.10%) reported Q3 EPS of 26 cents, weaker than consensus of 28 cents, and then lowered guidance on fiscal 2014 EPS view to $1.21-$1.27 from $1.29.

    Accenture PLC (ACN +2.19%) reported Q1 EPS of $1.12, above consensus of $1.09, and then raised guidance on fiscal 2014 EPS to $4.44-$4.56 from $4.42-$4.54, above consensus of $4.47.

    Dow Jones reports that Target (TGT +3.08%) was hit by theft of customers' credit card data over Black Friday weekend, and the data breach was extensive.

    Trulia (TRLA -0.39%) rose 4% in after-hours trading after SAC Capital reported a 5.2% passive stake in the company.

    AK Steel (AKS +2.43%) rose over 6% in after-hours trading when it raised guidance on Q4 EPs to a gain of 2 cents-6 cents, better than consensus of a -3 cent loss.

    Cascade Investment raises its stake in Deere (DE +1.26%) to 8.1% from 7.0%.

    JPMorgan Chase (JPM +2.73%) was downgraded to 'Neutral' from 'Buy' at SunTrust.

    Oracle (ORCL +2.88%) gained over 1% in after-hours trading after reported Q2 adjusted EPS of 69 cents, stronger than consensus of 67 cents.

    Herman Miller (MLHR +0.72%) reported Q2 adjusted EPS of 42 cents, above consensus of 40 cents.

    Paychex (PAYX +0.98%) reported Q2 EPS of 43 cents, better than consensus of 42 cents.


    Mar E-mini S&Ps (ESH14 -0.01%) this morning are down -1.75 points (-0.10%). The S&P 500 rallied sharply after the Fed said it will taper QE3 by $10 billion a month starting next month, which signals the Fed is confident the U.S. economy is strong enough to handle a reduction in stimulus. Other supportive factors included (1) the +22.7% surge in U.S. Nov housing starts from Aug, which was much stronger than expectations of 955,000 and the most in 5-3/4 years, and (2) the Fed's hike in its U.S. 2013 and 2014 GDP estimates and cut in its unemployment estimates. Closes: S&P 500 +1.66%, Dow Jones +1.84%, Nasdaq 100 +1.16%.

    Mar 10-year T-notes (ZNH14 -0.38%) this morning are down -10.5 ticks. Mar T-notes on Wednesday fell to a 1-1/2 week low and closed lower. Bearish factors included (1) the Fed's $10 billion QE3 tapering, (2) the larger-than-expected increase in U.S. Nov housing starts to a 5-3/4 year high, and (3) weak demand for the $35 billion auction of 5-year T-notes that had a bid-to-cover ratio of 2.42, below the 12-auction average of 2.67. T-note prices saw some support from the Fed's cut in its 2013 U.S. PCE inflation estimate. Closes: TYH4 -8.00, FVH4 -2.00.

    The dollar index (DXY00 +0.55%) this morning is up +0.388 (+0.48%). EUR/USD (^EURUSD) is up +0.0001 (+0.01%) and USD/JPY (^USDJPY) is down -0.18 (-0.17%). The dollar index on Wednesday initially rose after the Fed tapered QE3 by $10 billion a month and raised its 2013 and 2014 U.S. GDP estimates, but shed its gains and closed little changed after the Fed Chairman Bernanke said that inflation is "more than a bit of a concern" and that the FOMC will take action if inflation doesn't speed up, which suggests the Fed will be slow to cut QE3 further. USD/JPY surged to a fresh 5-year high on expectations the BOJ will continue to expand QE while the Fed cuts stimulus. Closes: Dollar index +0.044 (+0.05%), EUR/USD -0.00839 (-0.61%), USD/JPY +1.619 (+1.58%).

    Jan WTI crude oil (CLF14 +0.03%) this morning is down -4 cents (-0.04%) and Jan gasoline (RBF14 +0.25%) is down -0.0049 (-0.18%). Jan crude oil and gasoline prices on Wednesday closed higher. Crude prices found support on weekly EIA data showing (1) U.S. crude stockpiles declined for a third week as they fell -2.941 million bbl to a 2-month low of 372.3 million bbl, and (2) a -600,000 bbl decline in crude oil supplies at Cushing, OK, the delivery point for WTI futures. Jan gasoline climbed to a 1-week high on signs of stronger demand after weekly EIA data showed U.S. gasoline demand for the week ended Dec 13 rose +8% w/w to 9.016 million bpd. Closes: CLF4 +0.58 (+0.60%), RBF4 +0.0501 (+1.89%).


    US0830 ETWeekly initial unemployment claims expected -33,000 to 335,000, previous +68,000 to 368,000. Weekly continuing claims expected -21,000 to 2.770 million, previous +40,000 to 2,791 million.
     0830 ETUSDA weekly Export Sales.
     1000 ETDec Philadelphia Fed manufacturing index expected +3.5 to 10.0, Nov -13.3 to 6.5.
     1000 ETNov existing home sales expected -2.0% to 5.02 million, Oct -3.2% to 5.12 million.
     1000 ETNov leading indicators expected +0.7%, Oct +0.2%.
     1130 ETTreasury auctions $29 billion 7-year T-notes.
     1300 ETTreasury auctions $16 billion 5-year TIPS.
    JPN0000 ETRevised Japan Oct leading index CI, previous 109.9. Revised Oct coincident index, previous 109.6.
     0030 ETJapan Nov nationwide department store sales, Oct -0.6% y/y.
    UK0430 ETUK Nov retail sales ex autos expected +0.3% m/m and +2.4% y/y, Oct -0.6% m/m and +2.3% y/y.
     0430 ETUK Nov retail sales including autos expected +0.3% m/m and +2.2% y/y, Oct -0.7% m/m and +1.8% y/y.
     1905 ETUK Dec GfK consumer confidence expected +1 to -11, Nov -12.

    U.S. STOCK CALENDAR12/19/2013

    Company NameTickerTimeEvent DescriptionPeriodEstimate
    Darden Restaurants IncDRI USBef-mktQ2 2014 Earnings ReleaseQ2 20140.197
    Accenture PLCACN USBef-mktQ1 2014 Earnings ReleaseQ1 20141.092
    ConAgra Foods IncCAG US7:30Q2 2014 Earnings ReleaseQ2 20140.552
    Accenture PLCACN US8:00Q1 2014 Earnings CallQ1 2014 
    Darden Restaurants IncDRI US8:30Q2 2014 Earnings CallQ2 2014 
    ConAgra Foods IncCAG US9:30Q2 2014 Earnings CallQ2 2014 
    Coca-Cola Enterprises IncCCE US10:00FY 2014 Guidance CallY 2014 
    Lender Processing Services IncLPS US10:00Extraordinary Shareholders Meeting - M&A VoteY 2013 
    Carnival CorpCCL US10:30Q4 2013 Earnings CallQ4 2013 
    Paychex IncPAYX US10:30Q2 2014 Earnings CallQ2 2014 
    NIKE IncNKE US16:15Q2 2014 Earnings ReleaseQ2 20140.58
    TIBCO Software IncTIBX US16:30Q4 2013 Earnings CallQ4 2013 
    NIKE IncNKE US17:00Q2 2014 Earnings CallQ2 2014 
    Cintas CorpCTAS US17:00Q2 2014 Earnings CallQ2 2014 
    Red Hat IncRHT US17:00Q3 2014 Earnings CallQ3 2014 
    Cintas CorpCTAS USAft-mktQ2 2014 Earnings ReleaseQ2 20140.684
    Red Hat IncRHT USAft-mktQ3 2014 Earnings ReleaseQ3 20140.349
    TIBCO Software IncTIBX USAft-mktQ4 2013 Earnings ReleaseQ4 20130.394
    Carnival CorpCCL US Q4 2013 Earnings ReleaseQ4 20130

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