Monday, April 28th, 2014View Older Reports
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OVERNIGHT MARKETS AND NEWS
June E-mini S&Ps (ESM14 +0.36%) this morning are up +0.24% and European stocks are up +0.66% on increased M&A activity after Pfizer confirmed that it proposed to buy AstraZeneca, Britain's second-largest pharmaceutical company, for about 58.8 billion pounds ($98.7 billion). The U.S. and EU are expected to impose new sanctions as early as today on Russian companies and individuals close to Russian President Putin over the escalation of the Ukraine crisis. Asian stocks closed mostly lower: Japan -0.98%, Hong Kong -0.41%, China -1.52%, Taiwan +0.41%, Australia +0.09%, Singapore -0.76%, South Korea -0.24%, India -0.25%. Japanese stocks were dragged lower after Honda fell 4.5% when it forecast weaker-than-expected full-year profit. China's Shanghai Stock Index fell to a 5-week low after China's Securities Regulatory Commission late Friday said it will hold a meeting this Wednesday to review the IPOs of four companies, boosting speculation that new share sales will resume after a 3-month halt. Commodity prices are mostly higher. Jun crude oil (CLM14 +0.50%) is up +0.79%. Jun gasoline (RBM14 unch) is up +0.18%. Jun gold (GCM14 +0.01%) is up +0.02% at a 1-week high. May copper (HGK14 +0.18%) is up +0.27% at a 1-1/2 month high. Agriculture prices are higher. The dollar index (DXY00 -0.19%) is down -0.20% at a 2-week low. EUR/USD (^EURUSD) is up +0.25% at a 2-week high. USD/JPY (^USDJPY) is up +0.17%. The British pound climbed to a 4-1/3 year high against the dollar as increased M&A activity and a jump in a gauge of UK business confidence to a record high boosts the prospects for stronger British economic growth. June T-note prices (ZNM14 -0.10%) are down -2 ticks.
ECB Board member and Dutch Central Bank President, Klaas Knot, said that more evidence is needed on the effectiveness of quantitative easing and if the Eurozone inflation rate falls any further, the ECB could lower the deposit rate below 0%.
The German Mar import price index fell -0.6% m/m and -3.3% y/y, a larger decline than expectations of -0.1% m/m and -2.8% y/y
The UK Apr Lloyds business barometer rose to 66 from 44 in Mar, the highest since the survey began in 2002.
The UK Apr Hometrack weighted overall avg house price rose +0.6% m/m and +6.0% y/y.
Japan Mar retail sales rose +6.3% m/m and +16.1% y/y, stronger than expectations of +6.0% m/m and +13.8% y/y as consumers spent before the start of the Apr 1 sales tax increase.
China Mar industrial profits rose +10.1% year-to-date y/y, an improvement from the increase from the +9.4% year-to-date y/y in Feb.
U.S. STOCK PREVIEW
This will be a busy week with the likelihood of new G-7 sanctions on Russia, the 2-day FOMC meeting on Tue/Wed, Tuesday's U.S. Q1 GDP report (expected +1.2%), Friday's unemployment report (payrolls expected +215,000), the Treasury's sale of $15 billion of 2-year floating-rate notes on Tuesday, and a heavy earnings week. Today's March pending home sales report is expected to show an increase of +0.7%, reversing most of the -0.8% decline seen in February.
There are 13 of the S&P 500 companies that report earnings today. Notable reports include Lowes (consensus $0.70), National Oilwell Varco (1.38), Plum Creek Timber (0.15), Hartford Financial (0.93), General Growth Properties (0.30), Ameriprise (1.88), and Corning (0.30). Equity conferences during the week include: Milken Institute Global Conference on Mon, Nomura Retail Conference on Mon, Wunderlich Securities WasteExpo Investor Summit on Mon, Barclays Retail and Consumer Discretionary Conference on Tue-Wed, and Linley Group Mobile Conference on Wed-Thu.
OVERNIGHT U.S. STOCK MOVERS
Corning (GLW -2.12%) reported Q1 EPS of 31 cents, higher than consensus of 30 cents.
Allergan (AGN +0.92%) was downgraded to 'Hold' from 'Buy' at Stifel.
Panera Bread (PNRA -1.50%) was downgraded to 'Underperform' from 'Neutral' at Longbow.
Laboratory Corp. of America Holdings (LH -0.93%) reported Q1 EPS of $1.51, below consensus of $1.58.
Nationaol Oilwell Varco (NOV +0.71%) reported Q1 EPS of $1.40, higher than consesnsus of $1.38.
Roper Industries (ROP -1.83%) reported Q1 EPS of $1.46, better than consensus of $1.35.
Loews (L -0.68%) reported Q1 EPS of 62 cents, well below consensus of 70 cents.
Sanctions against Russia to be announced this week may include sanctions that restrict U.S. high-technology sales to the Russian defense industry, according to comments over the weekend by White House Deputy National Security Advisor Tony Blinken.
The merger between American Airlines (AML) and US Airways has been approved by a federal judge.
Merck (MRK -0.50%) is close to a deal to sell its consumer healthcare unit, according to Reuters.
June E-mini S&Ps (ESM14 +0.36%) this morning are up +4.50 points (+0.24%) on increased M&A activity. The S&P 500 index on Friday settled sharply lower due to (1) expectations for a new round of sanctions against Russia, (2) the Russian central bank's unexpected 50 bp rate hike to 7.50% and S&P's downgrade of Russia's sovereign debt by one step to BBB-, the lowest investment grade level, and (3) a sharp sell-off in tech stocks driven by disappointing results from Amazon.com, which plunged -6.5% after forecasting an operating loss in Q2. The main bullish factor was the +1.5 point increase to 84.1 in the U.S. final-April U.S. consumer confidence index from the University of Michigan, which was stronger than market expectations of +0.4 to 83.0. Closes: S&P 500 -0.81%, Dow Jones -0.85%, Nasdaq -1.75%.
Jun 10-year T-notes (ZNM14 -0.10%) this morning are down -2 ticks. Jun 10-year T-note futures prices on Friday closed mildly higher on safe-haven demand with (1) the sharp sell-off in stocks, and (2) increased concern about the Ukraine-Russia situation with expectations for another round of sanctions on Russia and S&P's downgrade of Russia's sovereign debt rating. Closes: TYM4 +4.5, FVM4 +1.75.
The dollar index (DXY00 -0.19%) this morning is down -0.157 (-0.20%) at a 2-week low. EUR/USD (^EURUSD) is up +0.0035 (+0.25%) at a 2-week high. USD/JPY (^USDJPY) is up +0.17 (+0.17%). The dollar index on Friday closed slightly lower: Dollar index -0.05 (-0.06%), EUR/USD +0.0003 (+0.02%), USD/JPY -0.16 (-0.16%). The dollar received a little support from the stronger-than-expected U.S. consumer confidence report of +1.5 to 84.1.
Jun WTI crude oil (CLM14 +0.50%) this morning is up +79 cents (+0.79%). Jun gasoline (RBM14 unch) is up +0.0055 (+0.18%). Jun crude and gasoline prices on Friday closed lower on the sharp sell-off in global stocks and the tense Russia-Ukraine situation: Closes: CLM4 -1.34 (-1.31%). RBM4 -0.0186 (-0.61%).
GLOBAL EVENT CALENDAR04/28/2014
|US||1000 ET||Mar pending home sales expected +0.7% m/m and -10.2% y/y, Feb -0.8% m/m and -10.2% y/y.|
|1100 ET||USDA weekly grain export inspections.|
|1600 ET||USDA weekly crop progress.|
|UK||0430 ET||UK Apr Lloyds business barometer, Mar 44.|
U.S. STOCK CALENDAR04/28/2014
|Company Name||Ticker||Time||Event Description||Period||Estimate|
|Laboratory Corp of America Holdings||LH US||Bef-mkt||Q1 2014 Earnings Release||Q1 2014||1.576|
|Roper Industries Inc||ROP US||Bef-mkt||Q1 2014 Earnings Release||Q1 2014||1.346|
|Corning Inc||GLW US||Bef-mkt||Q1 2014 Earnings Release||Q1 2014||0.303|
|Ecolab Inc||ECL US||Bef-mkt||Q1 2014 Earnings Release||Q1 2014||0.742|
|National Oilwell Varco Inc||NOV US||Bef-mkt||Q1 2014 Earnings Release||Q1 2014||1.384|
|Loews Corp||L US||Bef-mkt||Q1 2014 Earnings Release||Q1 2014||0.7|
|Franklin Resources Inc||BEN US||8:30||Q2 2014 Earnings Release||Q2 2014||0.89|
|Plum Creek Timber Co Inc||PCL US||Aft-mkt||Q1 2014 Earnings Release||Q1 2014||0.15|
|Hartford Financial Services Group Inc/The||HIG US||Aft-mkt||Q1 2014 Earnings Release||Q1 2014||0.927|
|General Growth Properties Inc||GGP US||Aft-mkt||Q1 2014 Earnings Release||Q1 2014||0.297|
|Ameriprise Financial Inc||AMP US||Aft-mkt||Q1 2014 Earnings Release||Q1 2014||1.88|
|Jacobs Engineering Group Inc||JEC US||Aft-mkt||Q2 2014 Earnings Release||Q2 2014||0.894|
|Range Resources Corp||RRC US||Aft-mkt||Q1 2014 Earnings Release||Q1 2014||0.505|