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BARCHART MORNING CALL 9/16

Sep. 16, 2015 3:49 PM ETFDX, CRI, ORCL, HAS, MSFT, WDC, AMCX, MSGS, ACRTX, XRAY, GPC, ORLY, SIX, YNDX, UNFI, PBI, UAA
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BARCHART MORNING CALL

Wednesday, September 16th, 2015View Older Reports

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OVERNIGHT MARKETS AND NEWS

December E-mini S&Ps (ESZ15 -0.08%) are down -0.10% as the FOMC heads into its two-day policy meeting that begins today and decides whether to raise interest rates for the first time in 9-years. European stocks are up +1.24% on a possible increase in M&A Activity as SABMiller soared 21% after it said that AB InBev intends to make a takeover proposal. Emerging market stocks rose as Chinese stocks surged in the last hour of trade to close up nearly 5% and snap a two-day slump. Asian stocks closed higher: Japan +0.81%, Hong Kong +2.38%, China +4.89%, Taiwan +0.89%, Australia +1.50%, Singapore +0.94%, South Korea +2.22%, India +1.00%.

The dollar index (DXY00 +0.19%)is up +0.19%. EUR/USD (^EURUSD) is down -0.47% on dovish comments from ECB Vice President Constancio and ECB Governing Council member Nowotny who both said the ECB could expand QE. USD/JPY (^USDJPY) is +0.12% as the yen weakened after S&P downgraded Japan's credit rating.

Dec T-note prices (ZNZ15 -0.04%)are down -1.5 ticks.

ECB Vice President Constancio said that the ECB has the scope to expand QE if needed as "we are very far from what the major central banks done."

ECB Governing Council member Nowotny said that weak Eurozone inflation is a "big problem for the ECB" and that an extension or an increase in volume of the ECB's asset purchases "is thinkable."

Standard & Poor's cut Japan's long-term credit rating one level to A+, saying the government's economic revival strategy-dubbed "Abenomics"- "will not be able to reverse this deterioration in the next two to three years."

In an attempt to quell capital outflows, the National Development and Reform Commission, China's top planning agency, said it will remove quotas for companies to raise funds in overseas bond and loan markets. China's foreign-exchange reserves plunged a record -$93.9 billion last month after the PBOC intervened to support the yuan following the Aug 11 devaluation.

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) weekly MBA mortgage applications (previous -6.2% with purchase sub-index -0.9% and refi sub-index -9.9%), (2) Aug CPI (expected -0.1% m/m and +0.2% y/y, Jul +0.1% m/m and +0.2% y/y) and Aug CPI ex food & energy (expected +0.1% m/m and +1.9% y/y, Jul +0.1% m/m and +1.8% y/y), (3) Sep NAHB housing market index (expected unch at 61, Aug +1 to 61), (4) the first day of the FOMC's 2-day policy meeting.

Two of the Russell 1000 companies reports earnings today: FedEx (consensus $2.45), Oracle (0.52).

U.S. IPO's scheduled to price today include: Regenxbio Inc (RGNX), Paycom Software (PAYC).

Equity conferences during the remainder of this week include: Bank of America Merrill Lynch Power & Gas Leaders Conference on Wed-Thu, Citi 2015 Industrials Conference on Wed-Thu, Deutsche Bank Technology Conference on Wed-Thu, Morgan Stanley Industrials Conference on Wed-Thu, Barclays Capital Global Financial Services Conference on Wed-Fri, Credit Suisse Basic Materials Conference on Wed-Fri, Goldman Sachs Communacopia Conference on Wed-Fri, Morgan Stanley Global Healthcare Conference on Wed-Fri, Bank of America Merrill Lynch Global Health Care Conference on Thu, Imperial Capital Global Opportunities Conference on Thu, and AACR CRI-CIMT-EATI Immunotherapy Conference on Thu-Fri.

OVERNIGHT U.S. STOCK MOVERS

FedEx (FDX +2.51%) reported Q1 EPS of $2.42, weaker than consensus of $2.46.

Carter's (CRI +0.85%) was downgraded to 'Neutral' from 'Overweight' at Piper Jaffray.

Oracle (ORCL +1.14%) was upgraded to 'Buy' from 'Neutral' at SunTrust.

Hasbro (HAS +1.93%) was initiated with a 'Buy' at Sterne Agee CRT with a price target of $84.

LinkedIn (LNKD +0.61%) was upgraded to 'Hold' from 'Sell' at Brean Capital.

SanDisk (SNDK +0.70%) was downgraded to 'Neutral' from 'Buy' at Goldman Sachs.

AMC Networks (AMCX +2.49%) rose over 2% in after-hours trading after Bloomberg reported that AMC is in talks to acquire Starz (STRZA +1.39%) .

Gabelli reported a 6.8% stake in Madison Square Garden (MSG +2.66%) .

Vertex (VRTX +0.44%) was initiated with a 'Buy' at Nomura with a price target of $162.

DENTSPLY International (XRAY +1.36%) and Sirona Dental Systems (SIRO +1.24%) announced that the Boards of Directors of both companies have unanimously approved a definitive merger agreement under which the companies will combine in an all-stock merger of equals.

Genuine Parts (GPC +2.24%) was initiated with a 'Buy' at Jefferies with a price target of $95.

O'Reilly Automotive (ORLY +2.10%) was initiated with a 'Buy' at Jefferies with a price target of $290.

Six Flags (SIX -0.04%) was initiated with a 'Buy' at Janney Capital with a price target of $55.

Yandex (YNDX +1.58%) was upgraded to 'Neutral' from 'Sell' at Goldman Sachs.

United Natural Foods (UNFI +1.56%) reported Q4 EPS of 72 cents, right on consensus.

MARKET COMMENTS

Dec E-mini S&Ps (ESZ15 -0.08%) this morning are down -2.00 points (-0.10%). Tuesday's closes: S&P 500 +1.28%, Dow Jones +1.40%, Nasdaq +1.20%. The S&P 500 on Tuesday closed higher on indications that U.S. consumers are still engaging in some spending despite the stock market correction as U.S. Aug retail sales rose by +0.2% and +0.1% ex autos, though weaker than expectations of +0.3% and +0.2% ex autos. The stock market was also boosted by hopes the Fed will defer a rate hike decision after the -0.4% decline in Aug industrial production. Energy producers rallied as the price of crude oil rose.

Dec 10-year T-notes (ZNZ15 -0.04%) this morning are down -1.5 ticks. Tuesday's closes: TYZ5 27.00, FVZ5 -15.50. Dec T-notes Tuesday fell to a 3-1/2 week low and closed lower on the close-to-expected increase in U.S. Aug retail sales and the rally in stocks.

The dollar index (DXY00 +0.19%) this morning is up +0.180 (+0.19%). EUR/USD (^EURUSD) is down -0.0053 (-0.47%). USD/JPY (^USDJPY) is up +0.14 (+0.12%). Tuesday's closes: Dollar Index +0.365 (+0.38%), EUR/USD -0.0048 (-0.42%), USD/JPY +0.19 (+0.16%). The dollar index on Tuesday closed higher on the increase in U.S. Aug retail sales, which bolstered the case for a Fed interest rate increase. In addition, EUR/USD saw weakness after the German Sep ZEW survey expectations of economic growth fell more than expected to a 10-month low.

Oct crude oil (CLV15 +1.35%) this morning is up +76 cents (+1.70%) and Oct gasoline (RBV15 +1.02%) is up +0.0206 (+1.55%). Tuesday's closes: CLV5 +0.59 (+1.34%), RBV5 +0.0336 (+2.58%). Oct crude oil and gasoline on Tuesday closed higher on (1) expectations that Wednesday's weekly EIA data will show crude supplies at Cushing, OK, delivery point of WTI futures, fell -1.0 million bbl, and (2) the plan by the House of Representatives to vote in the coming weeks on ending the 40-year-old ban on U.S. crude exports.

GLOBAL EVENT CALENDAR09/16/2015

US 0700 ET Weekly MBA mortgage applications, previous -6.2% with purchase sub-index -0.9% and refi sub-index -9.9%.
0830 ET Aug CPI expected -0.1% m/m and +0.2% y/y, Jul +0.1% m/m and +0.2% y/y. Aug CPI ex food & energy expected +0.1% m/m and +1.9% y/y, Jul +0.1% m/m and +1.8% y/y.
1000 ET Sep NAHB housing market index expected unch at 61, Aug +1 to 61.
1030 ET EIA Weekly Petroleum Status Report.
1100 ET FOMC begins 2-day policy meeting.
JPN 0200 ET Revised Japan Aug machine tool orders, previous -16.5% y/y.
1950 ET Japan Aug trade balance expected -540.0 billion yen, Jul -268.4 billion yen. Aug exports expected +4.3% y/y, Jul +7.6% y/y. Aug imports expected -2.5% y/y, Jul -3.2% y/y.
UK 0430 ET UK Aug jobless claims change expected -5,000, Jul -4,900. Aug claimant count rate expected unch at 2.3%.
0430 ET UK Jul avg weekly earnings expected +2.5% 3-mo avg y/y, Jun +2.4% 3-mo avg y/y. UK Jul weekly earnings ex-bonus expected +2.9% 3-mo avg y/y, Jun +2.8% 3-mo avg y/y.
0430 ET UK Jul ILO unemployment rate expected +5.6% in the 3-months through Jul, Jun +5.6% in the 3-months through Jun.
EUR 0500 ET Revised Eurozone Aug CPI, previous+0.2% y/y. Revised Aug core CPI, previous +1.0% y/y.
0500 ET Eurozone Q2 labor costs, Q1 +2.2% y/y

U.S. STOCK CALENDAR09/16/2015

Company Ticker Time Event Description Period Estimate
FedEx Corp FDX US 7:30 Q1 2016 Earnings Release Q1 2016 2.454
Pitney Bowes Inc PBI US 8:00 Analyst Day Y 2015
FedEx Corp FDX US 8:30 Q1 2016 Earnings Call Q1 2016
Under Armour Inc UA US 9:45 Investor Day Y 2015
Oracle Corp ORCL US 17:00 Q1 2016 Earnings Call Q1 2016
Oracle Corp ORCL US Aft-mkt Q1 2016 Earnings Release Q1 2016 0.523

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