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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 2/10 0 comments
    Feb 10, 2014 11:17 AM | about stocks: L, MT, URBN, HAS, WFM, APO, BMY, TXRH, ATHN, KORS, KIRK, ESPR, SCTY, PXD, MAS, MCD

    BARCHART MORNING CALL

    Monday, February 10th, 2014View Older Reports

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    OVERNIGHT MARKETS AND NEWS

    March E-mini S&Ps (ESH14 -0.24%) this morning are down -0.32% and European stocks are also down -0.32% as emerging market currencies declined. European stocks were also under pressure after French Dec industrial production fell -0.3% m/m and Italy Dec industrial production slid -0.9% m/m, both weaker than expected. Asian stocks closed mostly higher: Japan +1.77%, Hong Kong -0.27%, China +2.49%, Taiwan +0.05%, Australia +1.08%, Singapore +0.13%, South Korea -0.02%, India -0.21%. China's Shanghai Stock Index climbed to a 5-week high after Bank of America said Chinese spending during the 7-day Lunar New Year holiday signaled strong consumption and that economic growth will be "relatively stable." Commodity prices are mixed. Mar crude oil (CLH14 -0.45%) is down -0.32%. Mar gasoline (RBH14 -0.09%) is down -0.08%. Apr gold (GCJ14 +0.85%) is up +0.51% at a 2-week high. March copper (HGH14 +0.14%) is up +0.05% at a 1-week high. Agriculture prices are mixed ahead of the Feb WASDE crop production report later today. The dollar index (DXY00 -0.04%) is down -0.01% at a 1-week low. EUR/USD (^EURUSD) is down -0.01%. USD/JPY (^USDJPY) is down -0.16%. March T-note prices (ZNH14 +0.02%) are up +3 ticks.

    The Eurozone Feb Sentix investor confidence unexpectedly rose +1.4 to 13.3, better than expectations of -1.8 to 10.1 and the highest in 2-3/4 years.

    The UK Jan Lloyds employment confidence rose +10 to -2, the highest in 8-3/4 years.

    Japan Jan consumer confidence unexpectedly fell -0.8 to 40.5, weaker than expectations of +0.7 to 42.0 and the lowest in 13-months.

    The Japan Jan eco-watchers survey current fell -1.0 to 54.7, weaker than expectations of -0.2 to 55.5. The Jan eco-watchers survey outlook fell -5.7 to 49.0, the lowest in 14-months.

    U.S. STOCK PREVIEW
    Today's Jan payroll report is expected to show an increase of +182,000, returning to more reasonable figures after the very disappointing report of +74,000 seen in December. Today's Jan unemployment rate is expected to be unchanged at 6.7%, sustaining the -0.3 point drop seen in December to the 5-year low of 6.7%. There are 5 of the S&P 500 companies that report earnings today: Lab Corp of America ($1.66), Wyndham (0.73), Cigna (1.49), Moody's (0.76), and FLIR Systems (0.37). Equity conferences during the remainder of this week include India Auto Expo 2014 on Fri.

    OVERNIGHT U.S. STOCK MOVERS

    Loews (L +0.98%) reported Q4 EPS of 65 cents, below consensus of 70 cents.

    ArcelorMittal (MT +1.29%) was downgraded to 'Neutral' from 'Buy' at BofA/Merrill.

    Urban Outfitters (URBN +1.80%) was upgraded to 'Buy' from 'Hold' at Brean Capital.

    Hasbro (HAS +0.87%) reported Q4 EPS of $1.12, weaker than consensus of $1.22.

    Whole Foods Markets (WFM +0.18%) was upgraded to 'Buy' from 'Hold' at BB&T.

    Apollo Global (APO +0.38%) was upgraded to 'Buy' from 'Neutral' at Citigroup.

    Bristol-Myers (BMY +2.76%) was upgraded to 'Outperform' from 'Market Perform' at BMO Capital with a price target of $50.

    Texas Roadhouse (TXRH +2.52%) was upgraded to 'Strong Buy' from 'Outperform' at Raymond James.

    Piper Jaffray reiterated its 'Overweight' rating on athenahealth (ATHN +25.06%) and raised its price target on the stock to $220 from $170.

    Jennison Associates reported a 5.9% passive stake in Michael Kors (KORS +2.97%) .

    Polar Securities reported a 5.7% passive stake in Kirkland's (KIRK -1.00%) .

    Aisling Capital II reported a 13.8% passive stake in Esperion Therapeutics (ESPR +11.37%) .

    Elon Musk reported a 23.1% stake in SolarCity (SCTY +3.68%) .

    MARKET COMMENTS

    Mar E-mini S&Ps (ESH14 -0.24%) this morning are down -5.75 points (-0.32%). The S&P 500 on Friday closed higher on ideas that the weaker-than-expected Jan payroll report was due to inclement weather. U.S. Jan non-farm payrolls rose +113,000, below expectations of +180,000, although the Jan unemployment rate unexpectedly dropped -0.1 to 6.6%, better than expectations of unch at 6.7% and the lowest in 5-1/4 years. Another positive for stocks was the U.S. Department of Labor's annual revisions from Mar 2013 through Dec 2013 that showed an additional +369,000 of payroll jobs over that period. Closes: S&P 500 +1.33%, Dow Jones +1.06%, Nasdaq 100 +1.84%.

    Mar 10-year T-notes (ZNH14 +0.02%) this morning are up +3 ticks. Mar 10-year T-note futures prices on Friday recovered from a 1-week low and closed higher on concern that the U.S. economy is losing momentum after Jan non-farm payrolls rose less than expected for a second month. Closes: TYH4 +11.50, FVH4 +8.50.

    The dollar index (DXY00 -0.04%) this morning is down -0.005 (-0.01%) at a 1-week low. EUR/USD (^EURUSD) is down -0.0002 (-0.01%). USD/JPY (^USDJPY) is down -0.16 (-0.16%). The dollar index on Friday fell to a 1-week low and closed lower after U.S. Jan non-farm payrolls rose less than expected, which boosted speculation the Fed may slow the pace of reduction in its monthly bond buying. EUR/USD fell back from a 1-week high after Germany's Federal Constitution Court sought advice on whether the ECB's OMT bond-buying program is legal. Closes: Dollar index -0.215 (-0.27%), EUR/USD +0.00463 (+0.34%), USD/JPY +0.266 (+0.26%).

    Mar WTI crude oil (CLH14 -0.45%) this morning is down -32 cents (-0.32%) and Mar gasoline (RBH14 -0.09%) is down -0.0022 (-0.08%). Mar crude oil and gasoline prices Friday posted 5-week highs and closed higher. Bullish factors included (1) a weak dollar, (2) strong demand for heating fuels after Commodity Weather Group said Jan was the coldest for the month in the last 20 years, and (3) strength in gasoline on supply concerns after Energy Aspects Ltd. said an average of 1.6 million barrels a day of U.S. refining capacity will be off-line in Feb for planned and unplanned work. The energy markets shrugged off the smaller-than-expected increase in U.S. Jan payrolls as weather-related. Closes: CLH4 +2.04 (+2.22%), RBH4 +0.0659 (+2.46%).

    GLOBAL EVENT CALENDAR02/10/2014

    US1100 ETUSDA weekly grain export inspections.
     1200 ETFeb WASDE crop production report.
    JPN0000 ETJapan Jan consumer confidence index, Dec 41.3.
     0100 ETJapan Jan eco watchers survey current expected -0.2 to 55.5, Dec 55.7. Jan eco watchers survey outlook, Dec 54.7.
    EUR0430 ETEurozone Feb Sentix investor confidence expected -1.8 to 10.1, Jan 11.9.
    UK0430 ETUK Jan Lloyds employment confidence, Dec -12.
     1901 ETUK Jan BRC sales like-for-like expected +0.8% y/y, Dec +0.4% y/y.

    U.S. STOCK CALENDAR02/10/2014

    Company NameTickerTimeEvent DescriptionPeriodEstimate
    Hasbro IncHAS USBef-mktQ4 2013 Earnings ReleaseQ4 20131.217
    Loews CorpL USBef-mktQ4 2013 Earnings ReleaseQ4 20130.7
    Hasbro IncHAS US8:30Q4 2013 Earnings CallQ4 2013 
    Pioneer Natural Resources CoPXD USAft-mktQ4 2013 Earnings ReleaseQ4 20130.984
    Masco CorpMAS USAft-mktQ4 2013 Earnings ReleaseQ4 20130.164
    McDonald's CorpMCD US January 2014 Sales and Revenue Release2014

    Stocks: L, MT, URBN, HAS, WFM, APO, BMY, TXRH, ATHN, KORS, KIRK, ESPR, SCTY, PXD, MAS, MCD
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