Today - Tuesday, May 5, 2015
- Adidas (OTCQX:ADDYY, OTCPK:ADDDF) reports sales rose 9% to €4.083B ($4.556B) in Q1 on a currency-neutral basis.
- Sales in Europe +11% to €1.143B ($1.276B).
- Sales in North America +7% to €591M ($659.6M).
- China was a bigger contributor during the quarter with the region seeing sales growth of 21% to €597M ($666.45M).
- Reebok sale were up 9% as training and studio products showed strong demand.
- Net profit came in at 221M ($246M) vs. €234M consensus estimate.
- Adidas earnings press release (.pdf)
- The German 10-year Bund yield was below 0.10% as recently as two weeks ago, but it's up another 11 basis points today to the relatively sky-high level of 0.50%, and dragging along the rest of Western bond yields.
- Italian 10-years are up 28 bps to 1.76%; Spain up 28 bps to 1.74%; U.K. up 14 bps to 2.0%.
- "The bond market meltdown goes on," writes SocGen's Kit Juckes, though he believes it to be more correction, rather than a trend change.
- In the U.S., the 10-year yield is up another three basis points to 2.18% - about its highest level of 2015.
- Previously: Bill Gross: Bunds are short sale of a lifetime (April 21)
- ETFs: TBT, TLT, TMV, TBF, EDV, TMF, TTT, ZROZ, TLH, SBND, VGLT, UBT, DLBS, TLO, BUNL, TENZ, ITLY, LBND, ITLT, GGOV, BUNT, DLBL, TYBS, VUSTX
- Amid local news reports of a number of Chinese brokerages tightening margin requirements, the Shanghai Composite reversed a higher open to close lower by 4.05% overnight.
- The market there is up about 80% since November, so these sorts of short-term panics shouldn't be too surprising.
- Particularly hard hit were banking shares (NYSEARCA:CHIX), with China Construction Bank, Bank of China, and Bank of Communications each lower by about 5%.
- ETFs: FXI, ASHR, EWH, CAF, YINN, PGJ, GXC, FXP, YANG, PEK, MCHI, XPP, YAO, ASHS, YXI, CN, CHXF, FCA, CNXT, CHNA, EWHS, KBA, FCHI, FHK, AFTY
- Mondelez International (NASDAQ:MDLZ) and D.E. Master Blenders (OTC:DEMBF) land conditional approval from the European Commission on their proposed merger after agreeing to divest a few brands in certain regions.
- The newly-created Jacobs Douwe Egberts is expected to strike revenue of more than €5B ($5.56B).
- Pierre Laubies will be the pure play coffee company's CEO.
- The European Commission raised its euro-area growth forecast today as dwindling fears of deflation and monetary stimulus help the economy overcome pressure from the continuing crisis in Greece.
- While GDP in the 19-nation bloc is now forecast to increase 1.5% this year (up from a prediction of 1.3% in February), the European Commission slashed Greece's economic growth outlook to 0.5% in 2015, down from an earlier 2.5% estimate.
- Other GDP forecasts for 2015: Germany +1.9%; France +1.1%; Italy +0.6%.
- The euro is -0.3% to $1.1113.
- European stocks: FTSE 100 +0.6%; DAX +0.6%; CAC 40 +0.5%; Euro Stoxx 50 +0.4%.
- Indonesia's economy unexpectedly shrank for a second straight quarter as exports and government spending dropped, dealing a setback to President Joko Widodo as he seeks to bolster the economy.
- Coming in below forecasts for 4.9% growth, GDP grew 4.7% from the year-ago period in Q1 and lower than the 5% expansion seen in Q4.
- Widodo took office in October pledging to increase infrastructure spending, boost investment and achieve 7% expansion by 2017 in Southeast Asia's largest economy.
- ETFs: IDX, EIDO, IDXJ
- Asian stock markets retreated today after Australia's central bank cut interest rates for the second time in four months, lowering its cash-rate target to a record low 2.0% from 2.25%.
- Although the economy is showing signs of improvement, the new move will reinforce economic growth in the face of falling commodity prices and a China slowdown.
- The Australia dollar also fell sharply following the announcement, hitting $0.7801, before rebounding to $0.7906 (+0.9%).
- S&P ASX 200 -0.1%. Asia: Shanghai -2.8%; Hang Seng -1.3%.
- ETFs: FXA, EWA, AUSE, CROC, KROO, EWAS, GDAY, FAUS, QAUS
Monday, May 4, 2015
- Despite the rally in Treasurys this year, the 10-year yield was unable to take out its June 2012 low, leaving Jeff Gundlach (DBLTX, DSL) - presenting at Ira Sohn - wondering if we haven't already seen the bottom in rates.
- What to buy if rates turn higher? Not high-yield, says Gundlach, pointing to research showing a strategy of selling high-yield and buying Treasurys after the Fed begins hiking rates has been a winning one.
- What Gundlach is buying is Puerto Rican municipal debt - "they've priced in a lot of problems." 20-year paper is going for $0.78 on the dollar - a tax-free yield of 11%.
- ETFs: AGG, HYG, JNK, BND, BOND, HYLD, SJB, SCHZ, PLW, ANGL, LAG, GOVT, HYLS, UJB, XOVR, FBND, SAGG, QLTC, GBF, IUSB, TAPR, VBND
- Adidas (OTCQX:ADDYY, OTCPK:ADDDF) won't sell Reebok, CEO Herbert Heiner tells a German publication.
- The WSJ reported last fall that a $1.9B bid from a consortium of investors was in the works.
- "Everyone knows fitness is the ultimate trend, and Reebok is the right brand. So why should we dispose of it now," said a confident Heiner.
- Japan Closed
- Hong Kong -0.03%.
- China +0.87%.
- India +1.77%.
- London Closed.
- Paris +0.67%.
- Frankfurt +0.52%.
- Negotiations between Greece and its international lenders over reforms to unlock bailout aid have made headway and an agreement could be closer this month, a government official said on Sunday.
- "There were very important steps made at the Brussels Group (talks) which bring an agreement nearer," the official said. "All sides aim for an agreement at a Brussels Group level within May."
- Talks between Athens and the troika will resume on Monday and are expected to continue through Wednesday. Greece owes the next repayment of its debt package to the IMF on May 12.
- ETFs: GREK -3.4% premarket
- The eurozone's manufacturing sector expanded in April, although at a slightly slower pace than in March, as orders continued to flow and companies added staff.
- Markit's final April manufacturing PMI fell to 52.0, revised up from a flash reading of 51.9 but shy of March's 10-month high of 52.2.
- The recent dip in the PMI "will serve to check recent optimism that the ECB's quantitative-easing program has bought a guaranteed ticket to recovery for the region," said Markit's Chief Economist Chris Williamson.
- The euro is -0.5% to $1.1138.
- European stocks: FTSE 100 closed; DAX +1.1%; CAC 40 +0.6%; Euro Stoxx 50 +0.5%.
- Russian President Vladimir Putin ratified an accord Saturday to set up a $100B reserve fund for the so-called BRICS nations, aimed at reshaping the Western-dominated international financial system centered around the IMF and World Bank.
- China is poised to provide the largest share of $41B to the pool, while Russia, Brazil and India will provide $18B each. South Africa is set to chip in the remaining $5B.
- Previously: BRICS launches bank to offset Western-dominated financial system (Jul. 16 2014)
- ETFs: EWZ, RSX, EPI, INDY, RUSL, PIN, EZA, INP, INDL, RSXJ, ERUS, RUSS, DSUM, CHIX, INXX, INDA, RBL, BRZU, BZQ, UBR, BRZS, DBBR, CHLC, FBZ, RUDR
- Chinese shares bounced back from their earlier lows on Monday as weak China factory activity reinforced views that Beijing will roll out more stimulus measures to support its slowing economy.
- The HSBC final Purchasing Managers' Index fell to 48.9, its fastest drop in a year, down from the preliminary reading of 49.2 and weakening from the 49.6 print in March.
- Meanwhile, the IMF is close to declaring China's yuan as fairly valued for the first time in more than a decade, a milestone that follows years of IMF censure of Beijing's management of the currency.
- Shanghai +0.5%; Hang Seng +0.3%
- ETFs: FXI, ASHR, EWH, CAF, YINN, KWEB, PGJ, GXC, FXP, CYB, HAO, YANG, CNY, TAO, CHIX, PEK, CHIQ, CQQQ, MCHI, QQQC, XPP, YAO, ASHS, YXI, CN, FXCH, CHXF, FCA, CHNA, CNXT, CHII, ECNS, CHIE, EWHS, CHIM, KBA, KFYP, FCHI, FHK, AFTY
Friday, May 1, 2015
- Toyota (NYSE:TM) lost some ground to major rivals Ford and GM in the U.S. during April with sales growth for the long-time top-selling Camry trailing off.
- Sales by brand: Toyota +0.5% to 177,453 units; Lexus +11.7% to 25,876.
- Sales by model: Corolla +10.1% to 31,990; Prius -15.4% to 15,235 (PHV version -66%); Camry -10.4% to 34,066; Lexus ES -22.1% to 4,701 RAV4 +21.7% to 22,914; Highlander +10.9% to 13,763.
- YTD Toyota U.S. sales +8.1% to 778,949 units.
- Previously: Toyota April U.S. sales: +1.8%
- Mercedes-Benz (OTCPK:DDAIF) unit sales +10.6% to 32,432 units.
- Sales growth by Mercedes class: C-Class +30% to 6,665; E-Class -43% to 3,466; S-Class +5.9% to 2,021; M-Class +29.1% to 4,945; GL-Class -2.6% to 2,195.
- Sprinter sales up 15.5% to 2,764 units.
- Smart sales dropped 54% to 480.
- YTD Mercedes-Benz sales across all three brands +8.2% to 117,860 units.
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