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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. He earned a BS in Accounting and Business Administration from Berry College; a Juris Doctorate from the Woodrow Wilson School of Law; and attended... More
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  • BARCHART MORNING CALL 4/4 0 comments
    Apr 4, 2014 1:16 PM | about stocks: JPM, KMX, GCO, GIS, HAS, GME, APC, FIATY, VOD, IMI, EJ, MU, SNX, GPN, DIS

    BARCHART MORNING CALL

    Friday, April 4th, 2014View Older Reports

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    OVERNIGHT MARKETS AND NEWS

    June E-mini (ESM14 +0.20%) S&Ps this morning are up +0.16% and European stocks are up +0.15% on optimism that today's U.S. payrolls data for Mar may signal the economy is strengthening. Another positive for European stocks is signs of strength in German factory output after German Feb factory orders rose more than expected. Yesterday's comments from ECB President Draghi that the ECB may use quantitative easing to ward off deflation has boosted European government bonds as yields on Spanish, Italian and Irish securities all declined to record lows. Asian stocks closed mixed: Japan -0.05%, Hong Kong -0.24%, China +0.95%, Taiwan closed for holiday, Australia +0.24%, Singapore -0.23%, South Korea +0.05%, India -0.66%. Commodity prices are mixed. May crude oil (CLK14 +0.88%) is up +0.76%. May gasoline (RBK14 +0.31%) is up +0.15%. Jun gold (GCM14 +0.61%) is up +0.53%. May copper (HGK14 +0.66%) is up +0.69%. Agriculture and livestock prices are mixed. The dollar index (DXY00 +0.02%) is up +0.03% at a 5-week high on expectations that today's U.S. Mar payrolls data will show employers added the most jobs in 4 months, which will bolster the case for further Fed tapering of QE3. EUR/USD (^EURUSD) is down -0.12% at a 5-week low. USD/JPY (^USDJPY) is down -0.02%. June T-note prices (ZNM14 -0.04%) are down -1.5 ticks.

    German Feb factory orders rose +0.6% m/m, three times better than expectations of +0.2% m/m, while on an annual basis Feb factory orders rose +6.1% y/y, less than expectations of +6.8% y/y. Jan Factory orders were revised down to +0.1% m/m and +7.0% y/y, well below the previously reported +1.2% m/m and +8.4% y/y.

    The German Mar Markit retail PMI fell -0.9 to 50.2, the slowest rate of expansion in 11 months.

    The Eurozone Mar Markit retail PMI climbed +0.7 to 49.2

    UK Mar Halifax house prices unexpectedly fell -1.1% m/m, weaker than expectations of +0.6% m/m and the biggest monthly decline in 1-3/4 years. On an annual basis, prices rose +8.7% y/y, less than expectations of +9.4% y/y.

    U.S. STOCK PREVIEW

    Unemployment report - Today's March payroll report is expected to show an increase of +200,000, improving substantially from the weak average monthly increase of +129,000 seen in the previous three months (Dec +84,000, Jan +129,000, Feb +175,000). Meanwhile, today's March unemployment rate is expected to show a -0.1 point decline to 6.6%, thus matching the 5-1/2 year low posted in January. There is one of the Russell 1000 companies that reports earnings today: CarMax (consensus $0.54). There are no equity conferences today.

    OVERNIGHT U.S. STOCK MOVERS

    JPMorgan Chase (JPM +0.30%) was upgraded to 'Outperform' from 'Neutral' at Macquarie.

    CarMax (KMX -0.67%) reported Q4 EPS of 44 cents, weaker than consensus of 54 cents.

    Genesco (GCO -0.62%) was upgraded to 'Buy' from 'Neutral' at Sterne Agee.

    General Mills (GIS +1.18%) was downgraded to 'Hold' from 'Buy' at Argus.

    Hasbro (HAS -0.92%) was downgraded to 'Hold' from 'Buy' at Needham.

    GameStop (GME +2.35%) was upgraded to 'Buy' from 'Neutral' at BofA/Merrill.

    Anadarko (APC +14.51%) was upgraded to 'Overweight' from 'Underweight' at JPMorgan Chase.

    Fiat (FIATY +0.17%) was upgraded to 'Buy' from 'Neutral' at UBS.

    Vodafone (VOD -1.25%) was downgraded to 'Neutral' from 'Buy' at Nomura.

    David E. Lazovsky reported a 5.7% passive stake in Intermolecular (IMI +0.36%) .

    SAC Capital lowered its passive stake in E-House (EJ -2.98%) to 2.2% from 5.6%.

    Micron (MU -1.44%) reported Q2 adjusted EPS of 85 cents, better than consensus of 76 cents.

    SYNNEX (SNX -1.53%) reported Q1 adjusted EPS of $1.25, well ahead of consensus of 94 cents.

    Global Payments (GPN -0.31%) reported Q3 adjusted EPS of 96 cents, higher than consensus of 95 cents, and then raised guidance on fiscal 2014 EPS view to $4.06-$4.11 from $4.03-$4.10; consensus $4.10.

    MARKET COMMENTS

    June E-mini S&Ps (ESM14 +0.20%) this morning are up +3.00 points (+0.16%). The S&P 500 on Thursday posted a fresh record high but fell back and closed lower. Negative factors included (1) U.S. weekly jobless claims that rose +16,000 to 326,000, more than expectations of +8,000 to 319,000 and the most in 5-weeks, and (2) the U.S. Feb trade balance that widened to a -$42.3 billion deficit, more than expectations of -$38.5 billion and the biggest trade deficit in 5 months, which is negative for U.S. Q1 GDP. Closes: S&P 500 -0.11, Dow Jones unch, Nasdaq -0.77%.

    Jun 10-year T-notes (ZNM14 -0.04%) this morning are down -1.5 ticks. Jun 10-year T-note futures prices on Thursday closed slightly higher. Supportive factors for T-notes included (1) the larger-than-expected increase in U.S. weekly initial unemployment claims to the most in 5 weeks, and (2) the widening of U.S. Feb trade deficit to a 5-month high, which has negative implications for U.S. Q1 GDP. Closes: TYM4 +1.50, FVM4 +0.50.

    The dollar index (DXY00 +0.02%) this morning is up +0.024 (+0.03%) at a 5-week high. EUR/USD (^EURUSD) is down -0.0016 (-0.12%) at a 5-week low. USD/JPY (^USDJPY) is down -0.02 (-0.02%). The dollar index on Thursday rallied to a 5-week high and closed higher. Supportive factors for the dollar included (1) weakness in EUR/USD which fell to a 5-week low on signs the ECB is considering additional stimulus measures after ECB President Draghi said that "we do not exclude further monetary policy easing" to prevent "too prolonged a period of low inflation." Also, the dollar rose on expectations that strength in Friday's U.S. Mar payrolls report will keep the Fed's tapering regime intact. Closes: Dollar index +0.260 (+0.32%), EUR/USD -0.00474 (-0.34%), USD/JPY +0.045 (+0.04%).

    May WTI crude oil (CLK14 +0.88%) this morning is up +76 cents (+0.76%) and May gasoline (RBK14 +0.31%) is up +0.0043 (+0.15%). May crude and gasoline prices on Thursday closed higher after comments from ECB President Draghi suggested the ECB may provide additional stimulus to fight deflation risks, which may boost economic growth and energy demand. Gains were limited after the dollar index rallied to a 5-week high. Gasoline also found support on supply concerns after Wednesday's EIA inventory data showed gasoline stockpiles dropped to a 4-month low. Closes: CLK4 +0.67 (+0.67%). RBK4 +0.0450 (+1.57%).

    GLOBAL EVENT CALENDAR04/04/2014

    US0030 ETDallas Fed President Richard Fisher speaks on monetary policy at the Asia Society Hong Kong Center.
     0830 ETMar non-farm payrolls expected +200,000, Feb +175,000. Mar private payrolls expected +200,000, Feb +162,000. Mar manufacturing payrolls expected +6,000, Feb +6,000. Mar unemployment rate expected -0.1 to 6.6%, Feb +0.1 to 6.7%.
     0830 ETMar avg hourly earnings expected +0.2% m/m and +2.3% y/y, Feb +0.4% m/m and +2.2% y/y. Mar avg weekly hours expected +0.2 to 34.4 hours, Feb 34.2.
    GER0400 ETGerman Feb factory orders expected +0.2% m/m and +6.8% y/y, Jan +1.0% m/m and +8.4% y/y.
     0410 ETGerman Mar Markit retail PMI, Feb 52.1.
    EUR0410 ETEurozone Mar Markit retail PMI, Feb 48.5.

    U.S. STOCK CALENDAR04/04/2014

    Company NameTickerTimeEvent DescriptionPeriodEstimate
    CarMax IncKMX USBef-mktQ4 2014 Earnings ReleaseQ4 20140.537
    CarMax IncKMX US9:00Q4 2014 Earnings CallQ4 2014 
    Walt Disney Co/TheDIS US U.S. Box Office Release of Movie Captain America: The Winter Soldier""

    Stocks: JPM, KMX, GCO, GIS, HAS, GME, APC, FIATY, VOD, IMI, EJ, MU, SNX, GPN, DIS
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