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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 4/22 0 comments
    Apr 23, 2014 12:38 PM | about stocks: PG, NOC, YUM, BA, WRB, ILMN, IGT, DFS, BCR, SKX, FTI, CVA, JNPR, AMGN, GILD, CREE, VMW, T, ETN, APD, PX, R, TMO, DOW, BIIB, DAL, GCI, GD, TEL, JCI, APH, RAI, EMC, IR, NSC, AVY, LRCX, TSCO, CCI, FLS, EFX, ETFC, VAR, FB, XLNX, AVB, AIZ, TXT

    BARCHART MORNING CALL

    Wednesday, April 23rd, 2014View Older Reports

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    OVERNIGHT MARKETS AND NEWS

    June E-mini S&Ps (ESM14 -0.12%) this morning are down -0.12% and European stocks are down -0.30% on concern over Chinese economic growth after a gauge of manufacturing activity in China contracted for a fourth month. Another negative for European equities is the slide in technology stocks led by a -4.7% decline in Ericsson AB after the world's biggest maker of wireless networks reported quarterly profit that was below consensus. On the positive side, the Eurozone Apr Markit composite PMI expanded at its fastest pace in 2-3/4 years, and the Eurozone sovereign debt crisis continues to recede as the yield on Portugal's 10-year bond dropped to an 8-year low of 3.63% after the government sold 750 million euros of 10-year securities, the first government bond auction since Portugal requested financial aid three years ago. Asian stocks closed mixed: Japan +1.09%, Hong Kong -0.97%, China -0.10%, Taiwan -0.20%, Australia +0.70%, Singapore -0.60%, South Korea -0.13%, India +0.52%. Commodity prices are mixed. Jun crude oil (CLM14 -0.14%) is down -0.32% at a 1-week low on expectations for U.S. crude supplies to increase for the thirteenth time in fourteen weeks when the EIA reports weekly crude inventories later today. Jun gasoline (RBM14 +0.09%) is up +0.09%. Jun gold (GCM14 +0.44%) is up +0.49%. May copper (HGK14 -0.49%) is down -0.41%. Agriculture and livestock prices are weaker. The dollar index (DXY00 -0.22%) is down -0.22%. EUR/USD (^EURUSD) is up +0.28%. USD/JPY (^USDJPY) is down -0.35%. June T-note prices (ZNM14 +0.15%) are up +6.5 ticks.

    The Eurozone Apr Markit manufacturing PMI rose +0.3 to 53.3, better than expectations of no change at 53.0. The Apr Markit composite PMI unexpectedly rose +0.9 to 54.0, better than expectations of -0.1 to 53.0 and the fastest pace of expansion in 2-3/4 years.

    The German Apr Markit/BME manufacturing PMI rose +0.5 to 54.2, better than expectations of +0.1 to 53.8. The Apr Markit/BME composite PMI unexpectedly rose +2.0 to 56.3, stronger than expectations of -0.3 to 54.0.

    UK Mar public sector net borrowing increased by 4.9 billion pounds, less than expectations of 8.5 billion pounds.

    UK Apr CBI trends total orders dropped -7 points to -1, weaker than expectations of +1 point to 7. Apr CBI business optimism rose +12 to 33, better than expectations of +4 to 25 and the highest in 41 years.

    The China Apr HSBC manufacturing PMI rose +0.3 to 48.3, right on expectations.

    U.S. STOCK PREVIEW

    Today's March new home sales report is expected to show an increase of +2.3% to 450,000, recovering somewhat from the -3.3% decline to 440,000 seen in February. The Treasury today will sell $35 billion of 5-year T-notes. There are 41 of the S&P 500 companies that report earnings today. Notable reports include Apple (consensus $10.17), Facebook ($0.24), Texas Instrument (0.41), Procter & Gamble (1.02), General Dynamics (1.64), Johnson Controls (0.65). There are no equity conferences during the remainder of this week.

    OVERNIGHT U.S. STOCK MOVERS

    Procter & Gamble (PG -0.38%) reported Q3 EPS of $1.04, higher than consensus of $1.02.

    Northrop Grumman (NOC -1.98%) reported Q1 EPS of $2.63, much better than consensus of $2.15.

    Yum! Brands (YUM +1.93%) gained almost 3% in after-hours trading after it reported Q1 EPS ex-items of 87 cents, higher than consensus of 85 cents, and said Q1 same-store-sales in its China division were up 9%.

    Boeing (BA -0.21%) announced that Shandong Airlines commits to order fifty 737s.

    W. R. Berkley (WRB +0.22%) reported Q1 EPS of $1.25, well ahead of consensus of 79 cents.

    Illumina (ILMN +4.79%) rose 6% in after-hours trading after it reported Q1 adjusted EPS of 53 cents, stronger than consensus of 44 cents, and then raised guidance on fiscal 2014 EPS view to $2.10-$2.15, higher than consensus of $2.05.

    International Game (IGT +0.50%) reported Q2 adjusted EPS of 20 cents, higher than consensus of 19 cents.

    Discover (DFS -0.18%) reported Q1 EPS of $1.31, better than consensus of $1.25.

    C.R. Bard (BCR -0.01%) reported Q1 adjusted EPS $1.91, higher than consensus of $1.84.

    Skechers (SKX +2.64%) reported Q1 EPS of 61 cents, nearly double consensus of 33 cents.

    FMC Technologies (FTI +0.18%) reported Q1 EPS of 57 cents, higher than consensus of 50 cents.

    Covanta (CVA +1.18%) reported a Q1 adjusted EPS loss of -3 cents, five times better than consensus of a -15 cent loss.

    Juniper (JNPR +1.85%) reported Q1 adjusted EPS of 29 cents, right on consensus, but reported Q1 revenue of $1.17 billion, better than consensus of $1.15 billion.

    Amgen (AMGN +1.95%) lost nearly 3% in after-hours trading after it reported Q1 EPS of $1.87, below consensus of $1.94.

    Gilead (GILD +1.76%) climbed nearly 4% in pre-market trading after it reported Q1 EPS of $1.48, well above consensus of 89 cents.

    Cree (CREE +0.85%) reported Q3 EPS of 39 cents, better than consensus of 38 cents.

    VMware (VMW +0.30%) reported Q1 EPS of 80 cents, higher than consensus of 79 cents.

    AT&T (T +0.64%) fell over 2% in pre-market trading even after it reported Q1 adjusted EPS of 71 cents, better than consensus of 70 cents.

    MARKET COMMENTS

    June E-mini S&Ps (ESM14 -0.12%) this morning are down -2.25 points (-0.12%). The S&P 500 index on Tuesday climbed to a 2-week high and closed higher. Supportive factors included (1) the -0.2% decline in U.S. Mar existing home sales to 4.59 million, stronger than expectations of -1.0% to 4.56 million, (2) the +14 point increase in the Apr Richmond Fed manufacturing index to 7, stronger than expectations of +9 to 2, and (3) strength in drug makers that rallied on increased M&A activity as more than $28 billion in M&A deals bolstered speculation of more takeovers in the drug sector. Closes: S&P 500 +0.41%, Dow Jones +0.40%, Nasdaq +0.81%.

    Jun 10-year T-notes (ZNM14 +0.15%) this morning are up +6.5 ticks. Jun 10-year T-note futures prices on Tuesday fell to a 2-week low and closed lower. Bearish factors included (1) the rally in stocks which reduced the safe-haven demand for Treasuries, and (2) supply pressures as the Treasury auctions $96 billion of T-notes this week. Closes: TYM4 -3.50, FVM4 -3.50.

    The dollar index (DXY00 -0.22%) this morning is down -0.174 (-0.22%). EUR/USD (^EURUSD) is up +0.0038 (+0.28%). USD/JPY (^USDJPY) is down -0.36 (-0.35%). The dollar index on Tuesday closed lower after a rally in the S&P 500 to a 2-week high reduced the safe-haven demand for the dollar. EUR/USD closed higher after Eurozone Apr consumer confidence rose +0.6 to -8.7, better than expectations of unch at -9.3 and the highest in 6-1/2 years. Closes: Dollar index -0.040 (-0.05%), EUR/USD +0.0012 (+0.09%), USD/JPY +0.014 (+0.01%).

    Jun WTI crude oil (CLM14 -0.14%) this morning is down -33 cents (-0.32%) at a 1-week low and Jun gasoline (RBM14 +0.09%) is up +0.0027 (+0.09%). Jun crude and gasoline prices on Tuesday closed lower with Jun crude oil at a 1-1/2 week low. The main bearish factor was long liquidation spurred on by expectations that weekly EIA crude inventories on Wed will climb by 3 million bbl to a new 9-1/2 month high, the thirteenth increase in the last fourteen weeks. Closes: CLM4 -1.90 (-1.83%). RBM4 -0.0003 (-0.01%).

    GLOBAL EVENT CALENDAR04/23/2014

    US0700 ETWeekly MBA mortgage applications, previous +4.3% with purchase sub-index +1.3% and refi sub-index +6.9%.
     0945 ETMarkit Apr manufacturing PMI expected +0.5 to 56.0, Mar 55.5.
     1000 ETMar new home sales expected +2.3% to 450,000, Feb -3.3% to 440,000.
     1030 ETEIA Weekly Petroleum Status Report.
     1300 ETTreasury auctions $35 billion 5-year T-notes.
    GER0330 ETGerman Apr Markit/BME manufacturing PMI expected +0.1 to 53.8, Mar 53.7. Apr composite PMI expected 0.3 to 54.0, Mar 54.3.
    EUR0400 ETEurozone Apr Markit manufacturing PMI expected unch at 53.0, Mar 53.0. Apr composite PMI expected -0.1 to 53.0, Mar 53.1.
    UK0430 ETMinutes of the Apr 9-10 BOE policy meeting.
     0430 ETUK Mar public sector net borrowing expected 8.5 billion pounds, Feb 7.5 billion pounds.
     0600 ETUK Apr CBI trends total orders expected +1 to 7, Mar 6. Apr CBI trends selling prices expected -2 to 10, Mar 12. Apr CBI business optimism expected +4 to 25, Mar 21.
    JPN1950 ETJapan Mar corporate service price index expected +0.7% y/y, Feb +0.7% y/y.

    U.S. STOCK CALENDAR04/23/2014

    Company NameTickerTimeEvent DescriptionPeriodEstimate
    Eaton Corp PLCETN US2:00Annual General MeetingY 2014 
    Air Products & Chemicals IncAPD USBef-mktQ2 2014 Earnings ReleaseQ2 20141.354
    Northrop Grumman CorpNOC USBef-mktQ1 2014 Earnings ReleaseQ1 20142.152
    Dr Pepper Snapple Group IncDPS USBef-mktQ1 2014 Earnings ReleaseQ1 20140.592
    Praxair IncPX USBef-mktQ1 2014 Earnings ReleaseQ1 20141.508
    Procter & Gamble Co/ThePG USBef-mktQ3 2014 Earnings ReleaseQ3 20141.017
    Boeing Co/TheBA USBef-mktQ1 2014 Earnings ReleaseQ1 20141.542
    Ryder System IncR USBef-mktQ1 2014 Earnings ReleaseQ1 20140.87
    Thermo Fisher Scientific IncTMO USBef-mktQ1 2014 Earnings ReleaseQ1 20141.401
    Dow Chemical Co/TheDOW USBef-mktQ1 2014 Earnings ReleaseQ1 20140.707
    Biogen Idec IncBIIB USBef-mktQ1 2014 Earnings ReleaseQ1 20142.555
    Delta Air Lines IncDAL USBef-mktQ1 2014 Earnings ReleaseQ1 20140.287
    Gannett Co IncGCI USBef-mktQ1 2014 Earnings ReleaseQ1 20140.46
    General Dynamics CorpGD USBef-mktQ1 2014 Earnings ReleaseQ1 20141.636
    TE Connectivity LtdTEL USBef-mktQ2 2014 Earnings ReleaseQ2 20140.91
    Johnson Controls IncJCI USBef-mktQ2 2014 Earnings ReleaseQ2 20140.649
    Amphenol CorpAPH USBef-mktQ1 2014 Earnings ReleaseQ1 20140.957
    Reynolds American IncRAI USBef-mktQ1 2014 Earnings ReleaseQ1 20140.738
    EMC Corp/MAEMC US7:00Q1 2014 Earnings ReleaseQ1 20140.349
    Ingersoll-Rand PLCIR US7:00Q1 2014 Earnings ReleaseQ1 20140.258
    Norfolk Southern CorpNSC US8:00Q1 2014 Earnings ReleaseQ1 20141.148
    Biogen Idec IncBIIB US8:00Q1 2014 Earnings CallQ1 2014 
    Avery Dennison CorpAVY US8:30Q1 2014 Earnings ReleaseQ1 20140.661
    Procter & Gamble Co/ThePG US8:30Q3 2014 Earnings CallQ3 2014 
    Thermo Fisher Scientific IncTMO US8:30Q1 2014 Earnings CallQ1 2014 
    EMC Corp/MAEMC US8:30Q1 2014 Earnings CallQ1 2014 
    TE Connectivity LtdTEL US8:30Q2 2014 Earnings CallQ2 2014 
    Norfolk Southern CorpNSC US8:45Q1 2014 Earnings CallQ1 2014 
    Dow Chemical Co/TheDOW US9:00Q1 2014 Earnings CallQ1 2014 
    FMC Technologies IncFTI US9:00Q1 2014 Earnings CallQ1 2014 
    General Dynamics CorpGD US9:00Q1 2014 Earnings CallQ1 2014 
    Reynolds American IncRAI US9:00Q1 2014 Earnings CallQ1 2014 
    Yum! Brands IncYUM US9:15Q1 2014 Earnings CallQ1 2014 
    Lam Research CorpLRCX USAft-mktQ3 2014 Earnings ReleaseQ3 20141.165
    Tractor Supply CoTSCO USAft-mktQ1 2014 Earnings ReleaseQ1 20140.369
    Crown Castle International CorpCCI USAft-mktQ1 2014 Earnings ReleaseQ1 20141.12
    Flowserve CorpFLS USAft-mktQ1 2014 Earnings ReleaseQ1 20140.746
    Equifax IncEFX USAft-mktQ1 2014 Earnings ReleaseQ1 20140.868
    E*TRADE Financial CorpETFC USAft-mktQ1 2014 Earnings ReleaseQ1 20140.228
    Varian Medical Systems IncVAR USAft-mktQ2 2014 Earnings ReleaseQ2 20141.028
    Facebook IncFB USAft-mktQ1 2014 Earnings ReleaseQ1 20140.24
    Xilinx IncXLNX USAft-mktQ4 2014 Earnings ReleaseQ4 20140.552
    AvalonBay Communities IncAVB USAft-mktQ1 2014 Earnings ReleaseQ1 20141.628
    Assurant IncAIZ USAft-mktQ1 2014 Earnings ReleaseQ1 20141.553
    Cigna CorpCI US Annual General Meeting  
    Textron IncTXT US Annual General Meeting

    Stocks: PG, NOC, YUM, BA, WRB, ILMN, IGT, DFS, BCR, SKX, FTI, CVA, JNPR, AMGN, GILD, CREE, VMW, T, ETN, APD, PX, R, TMO, DOW, BIIB, DAL, GCI, GD, TEL, JCI, APH, RAI, EMC, IR, NSC, AVY, LRCX, TSCO, CCI, FLS, EFX, ETFC, VAR, FB, XLNX, AVB, AIZ, TXT
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