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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 1/15 0 comments
    Jan 15, 2014 3:35 PM | about stocks: BAC, FAST, AIQUF, INTC, DKS, PETM, REGN, CHTP, AGN, BZH, WSO, GM, CIM, JPM, WFC, BEAM, GME

    BARCHART MORNING CALL

    Wednesday, January 15th, 2014View Older Reports

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    OVERNIGHT MARKETS AND NEWS

    March E-mini S&Ps (ESH14 +0.20%) this morning are up +0.20% and European stocks are up +0.69% after the World Bank raised its global growth forecast. Asian stocks closed mostly higher: Japan +2.50%, Hong Kong +0.49%, China -0.18%, Taiwan +0.64%, Australia +0.64%, Singapore +0.62%, South Korea +0.30%, India +1.22%. Chinese stocks closed lower after China Dec new yuan loans rose at the slowest pace in a year and after the World Bank cut its China GDP estimate for this year. Commodity prices are mixed. Feb crude oil (CLG14 +0.54%) is up +0.54%. Feb gasoline (RBG14 -0.37%) is down -0.42%. Feb gold (GCG14 -0.65%)is down -0.57%. March copper (HGH14 -0.27%) is down -0.30%. Agriculture and livestock prices are mixed, although Feb cattle is up +0.09% at an all-time high. The dollar index (DXY00 +0.32%) is up +0.28%. EUR/USD (^EURUSD) is down -0.44% after a government report showed German growth slowed last year. USD/JPY (^USDJPY) is up +0.02%. March T-note prices (ZNH14 +0.05%) are up +0.5 of a tick.

    The World Bank raised its 2014 global GDP estimate to 3.2%, up from a June projection of 3.0% and stronger than the 2.4% increase in 2013. The bank lowered its 2014 China GDP forecast to 7.7% from 8.0% forecast in Jun, but raised its Eurozone GDP estimate to 1.1% from 0.9%, and kept its U.S. GDP estimate at 2.8% and its projection for Japan GDP at 1.4%.

    German 2013 GDP growth expanded at a +0.4% y/y annualized pace, weaker than expectations of +0.5% y/y annualized and the slowest pace of growth in 4-years.

    China Dec new yuan loans were 482.5 billion yuan, less than expectations of 570.0 billion yuan and the lowest in a year.

    Japan Dec machine tool orders jumped +28.0% y/y, the most in 2-1/3 years.

    The Eurozone Nov trade balance (nsa) widened to a 17.1 billion euro surplus from a revised 16.8 billion euro surplus in Oct.

    U.S. STOCK PREVIEW

    Today's Jan Empire manufacturing index is expected to show a +2.52 point increase to 3.50, adding to the small +3.19 point increase to 0.98 seen in December. Today's Dec PPI report is expected to rise to +1.1% y/y from +0.7% in November. Meanwhile, the Dec core PPI is expected to be unchanged from November at +1.3% y/y. The Fed today will release its Beige Book survey of the economy in preparation for the upcoming FOMC meeting in two weeks (Jan 28-29). The Fed's last Beige Book report, released on Dec 4, found that the U.S. economy "continued to expand at a modest to moderate pace from early October through mid-November."

    There are four of the S&P 500 companies that report earnings today: Bank of America (consensus $0.27), Fastenal (0.34), Kinder Morgan (0.34), CSX (0.43). Equity Conferences during the remainder of this week include: Biotech Showcase Investor Conference on Mon-Wed, J.P. Morgan Healthcare Conference on Mon-Thu, BMO Unconventional Resource Conference on Tue, Deutsche Bank Global Auto Industry Conference on Tue-Wed.

    OVERNIGHT U.S. STOCK MOVERS

    Bank of America (BAC +2.07%) reported Q4 EPS of 46 cents, well ahead of consensus of 27 cents.

    Fastenal (FAST +1.64%) reported Q4 EPS of 33 cents, below consensus of 34 cents.

    Airgas (ARG +1.23%) was downgraded to 'Sell' from 'Neutral' at Goldman.

    Intel (INTC +3.96%) was upgraded to 'Outperform' from 'Market Perform' at BMO Capital.

    Dick's Sporting (DKS +1.82%) was upgraded to 'Outperform' from 'Neutral' at Credit Suisse.

    PetSmart (PETM +0.48%) was downgraded to 'Neutral' from 'Buy' at UBS.

    Sanofi reported a 16.24% stake in Regeneron (REGN +11.78%) .

    Chelsea Therapeutics (CHTP -8.00%) exploded higher by more than 150% in after-hours trading after it announced that the FDA voted 16-1 to recommend approval of Northera for the treatment of symptomatic neurogenic orthostatic hypotension.

    Wells Fargo raised its price target range for Allergan (AGN +5.94%) to $132-$133 from $121-$122 and kept its 'Outperform' rating on the stock after Allergan received its first new Restasis patent and a district court found that Lumigan patents are valid.

    Credit Suisse reported a 6.9% passive stake in Beazer Homes (BZH +1.03%) .

    Watsco (WSO +2.17%) was downgraded to 'Sell' from 'Neutral' at Goldman.

    General Motors (GM +1.11%) rose over 3% in after-hours trading after it announced a 30 cents per share quarterly common stock dividend, its first dividend since coming out of bankruptcy.

    Credit Suisse reported a 5.36% passive stake in Chimera (CIM unch) .

    MARKET COMMENTS

    Mar E-mini S&Ps (ESH14 +0.20%) this morning are up +3.75 points (+0.20%). The S&P 500 on Tuesday recovered nearly all of Monday's losses on reduced economic concerns after U.S. Dec retail sales rose +0.2% and +0.7% ex-autos, better than expectations of +0.1% and +0.4% ex-autos. Stocks also found carry-over support from gains in European equities after Eurozone Nov industrial production rose +1.8% m/m, stronger than expectations of +1.4% m/m, and after ECB Governing Council member Nowotny said "there is potential on the upside" for this year's GDP in the Eurozone and that economic growth may exceed expectations. Closes: S&P 500 +1.08%, Dow Jones +0.71%, Nasdaq 100 +1.93%.

    Mar 10-year T-notes (ZNH14 +0.05%) this morning are up +0.5 of a tick. Mar 10-year T-note futures prices on Tuesday closed lower after the stronger-than-expected Dec U.S. retail sales boosted expectations for the Fed to continue to taper its monthly bond purchases. Closes: TYH4 -13.0, FVH4 -8.25.

    The dollar index (DXY00 +0.32%) this morning is up +0.226 (+0.28%). EUR/USD (^EURUSD) is down -0.0060 (-0.44%). USD/JPY (^USDJPY) is up +0.02 (+0.02%). The dollar index on Tuesday rebounded from a 1-1/2 week low and closed higher after stronger-than-expected U.S. Dec retail sales bolstered the outlook for the Fed to continue to taper its dollar-negative QE3 program. EUR/USD posted a 1-1/2 week high on the stronger-than-expected Eurozone Nov industrial production report along with upbeat comments from ECB Governing Council member Nowotny. USD/JPY rose as the yen weakened after the Japan Nov current account balance widened to a record. Closes: Dollar index +0.136 (+0.17%), EUR/USD +0.0008 (+0.06%), USD/JPY +1.218 (+1.18%).

    Feb WTI crude oil (CLG14 +0.54%) this morning is up +50 cents (+0.54%) and Feb gasoline (RBG14 -0.37%) is down -0.0109 (-0.42%). Feb crude oil prices and Feb gasoline prices on Tuesday settled mixed. Feb crude gained after stronger-than-expected U.S. Dec retail sales bolstered the economic outlook and the prospects for increased energy demand. Feb gasoline tumbled to a 2-month low on expectations that Wednesday's weekly EIA gasoline inventories will climb because last week's severe cold weather kept consumers from driving and reduced gasoline demand. Closes: CLG4 +0.79 (+0.86%), RBG4 -0.0117 (-0.44%).

    GLOBAL EVENT CALENDAR01/15/2014

    US 0700 ET Weekly MBA mortgage applications, previous +2.6% with purchase sub-index -0.5% and refi sub-index +4.6%.
      0830 ET Jan Empire manufacturing index expected +2.52 to 3.50, Dec +3.19 to 0.98.
      0830 ET Dec PPI expected +0.4% m/m and +1.1% y/y, Nov -0.1% m/m and +0.7% y/y. Dec PPI ex food & energy expected +0.1% m/m and +1.3% y/y, Nov +0.1% m/m and +1.3% y/y.
      1030 ET EIA Weekly Petroleum Status Report.
      1250 ET Chicago Fed President Charles Evans discusses current economic conditions and monetary policy at the Corridor Economic Forecast Luncheon in Coralville, Iowa.
      1400 ET Fed releases Beige Book.
      1745 ET Atlanta Fed President Dennis Lockhart speaks on the economic outlook to the CFA Society of Atlanta.
    JPN 0100 ET Japan Dec machine tool orders, Nov +15.4% y/y.
      1850 ET Japan Nov tertiary industry index expected +0.7% m/m, Oct -0.7% m/m.
      1850 ET Japan Nov machine orders expected +1.1% m/m and +11.7% y/y, Oct +0.6% m/m and +17.8% y/y.
      1850 ET Japan Dec domestic CGPI expected +0.3% m/m and +2.6% y/y, Nov +0.1% m/m and +2.7% y/y.
    EUR 0500 ET Eurozone Nov trade balance expected +16.5 billion euros (nsa), Oct +17.2 billion euros (nsa).
      0805 ET ECB Council member Yves Mersch peaks on a panel discussion titled The Eurozone in Five Years at an event in Germany.
    UK 1901 ET UK Dec RICS house price balance expected 60%, Nov 58%.

    U.S. STOCK CALENDAR01/15/2014

    Company Name Ticker Time Event Description Period Estimate
    JPMorgan Chase & Co JPM US 6:59 Q4 2013 Earnings Release Q4 2013 1.368
    Wells Fargo & Co WFC US 8:00 Q4 2013 Earnings Release Q4 2013 0.983
    JPMorgan Chase & Co JPM US 8:30 Q4 2013 Earnings Call Q4 2013  
    Beam Inc BEAM US   Suntory Holdings Acquires Beam    
    GameStop Corp GME US   December 2013 Sales and Revenue Release 2013
    Stocks: BAC, FAST, AIQUF, INTC, DKS, PETM, REGN, CHTP, AGN, BZH, WSO, GM, CIM, JPM, WFC, BEAM, GME
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