Thursday, October 23rd, 2014
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OVERNIGHT MARKETS AND NEWS
December E-mini S&Ps (ESZ14 +0.48%) this morning are up +0.23% and European stocks are down -0.21%. European stocks declined as disappointing earnings results from Unilever and Michelin outweighed positive economic data that showed Oct manufacturing activity in China and Europe unexpectedly expanded. Asian stocks closed mostly lower: Japan -0.37%, Hong Kong -0.30%, China -0.94%, Taiwan -0.20%, Australia -0.05%, Singapore +1.05%, South Korea -0.30%, India closed for holiday. China's Shanghai Stock Index fell to a 1-month low on concern a planned trading link between China and Hong Kong will be delayed after Reuters reported that major banks and money managers asked the Hong Kong securities regulator to delay the start of the trading link between the Hong Kong and Shanghai stock exchanges because of uncertainty over rules. Commodity prices are mixed. Dec crude oil(CLZ14 +0.24%) is up +0.29%. Dec gasoline (RBZ14 +0.20%) is up +0.23%. Dec gold (GCZ14 -0.72%) is down -0.52%. Dec copper (HGZ14 +0.36%) is up +0.46%. Agriculture and livestock prices are mostly higher. The dollar index (DXY00 unch) is down -0.04%. EUR/USD (^EURUSD) is up +0.15%. USD/JPY (^USDJPY) is up +0.33% at a 1-1/2 week high. Dec T-note prices (ZNZ14 -0.09%) are down -1.5 ticks.
The China Oct HSBC manufacturing PMI unexpectedly climbed +0.2 to 50.4, a faster pace of expansion than expectations of unchanged at 50.2.
The German Oct Markit/BME manufacturing PMI unexpectedly rose +1.9 to 51.8, a faster pace of expansion than expectations of -0.4 to 49.5.
The Eurozone Oct Markit manufacturing PMI unexpectedly rose +0.4 to 50.7, a faster pace of expansion than expectations of -0.4 to 49.9.
The Japan Markit/JMMA manufacturing PMI rose +1.1 to 52.8, better than expectations of unch at 51.7 and the fastest pace of expansion in 7 months.
UK Oct CBI trends total orders unexpectedly fell -2 to -6, weaker than expectations of +1 to -3 and the lowest in 15 months. Oct BI trends selling prices fell -4 to -3, a bigger decline than expectations of -1 to 0. Oct CBI business optimism fell -11 to 8, a bigger decline than expectations of -4 to 15 and the lowest in 15 months.
UK Sep retail sales ex autos unexpectedly fell -0.3% m/m and rose +3.1% y/y, weaker than expectations of unch m/m and +3.4% y/y. Sep retail sales including autos fell -0.3% m/m and rose +2.7% y/y, weaker than expectations of -0.1% m/m and +2.9% y/y.
U.S. STOCK PREVIEW
The markets are expecting a mixed report today with initial claims rising +17,000, reversing most of last week's -23,000 decline, and with continued claims falling -9,000 after last week's rise of +7,000. The market is expecting today's Aug FHFA house price index to show an increase of +0.3% m/m, adding to the +0.1% increase seen in July. The market is expecting today's Sep leading indicators report to show a sharp increase of +0.7%, adding to the +0.2% increase seen in August.
There are 45 of the S&P 500 companies that report earnings today with notable reports including: Microsoft (consensus $0.55), Amazon (-$0.75), GM (0.95), Caterpillar (1.34), PulteGroup (0.36), Coca-Cola Enterprises (0.88), Comcast (0.71), Raytheon (1.60), VeriSign (0.69). Equity conferences during the remainder of this week include: Latin Markets Private Wealth Latin America and the Caribbean Forum on Thu.
OVERNIGHT U.S. STOCK MOVERS
Coca-Cola Enterprises (CCE -0.79%) reported Q3 EPS of 92 cents, better than consensus of 88 cents.
Celgene (CELG -0.22%) reported Q3 EPS of 97 cents, higher than consensus of 95 cents.
Precision Castparts (PCP -2.05%) reported Q2 EPS of $3.24, weaker than consensus of $3.32.
Eli Lilly (LLY unch) reported Q3 EPS of 66 cents, below consensus of 67 cents.
O'Reilly Automotive (ORLY -0.97%) gained over 3% in after-hours trading after it reported Q3 EPS of $2.06, stronger than consensus of $1.95, and then raised guidance on fiscal 2014 EPS to$7.19-$7.23, better than consensus of $7.15.
Cheesecake Factory (CAKE -0.34%) slid over 3% in after-hours trading after it reported Q3 EPS of 48 cents, less than consensus of 57 cents, and then lowered guidance on fiscal 2014 EPS to $2.07-$2.11, weaker than consensus of $2.21.
Lam Research (LRCX -1.82%) reported Q1 EPS of 96 cents, better than consensus of 93 cents.
Everest Re (RE +0.07%) reported Q3 EPS of $6.00, well above consensus of $4.79.
C.R. Bard (BCR -0.83%) reported Q3 adjusted EPS of $2.15, stronger than consensus of $2.10, and then raised guidance on fiscal 2014 EPS view to $8.34-$8.38 from $8.25-$8.35, better than consensus of $8.31.
Skechers (SKX +0.92%) reported Q3 EPS of $1.00, higher than consensus of 93 cents.
Plexus (PLXS -2.18%) reported Q4 EPS of 77 cents, below consensus of 78 cents.
Tractor Supply (TSCO -0.26%) jumped over 10% in after-hours trading after it reported Q3 EPS of 55 cents, better than consensus of 50 cents.
AT&T (T -0.35%) dropped 3% in after-hours trading after it reported Q3 adjusted EPS of 63 cents, less than consensus of 64 cents, and then lowered guidance on fiscal 2014 revenue growth view to 3%-4% from 5%.
Albemarle (ALB -2.28%) reported Q3 adjusted EPS of $1.14, higher than consensus of $1.02.
Dec E-mini S&Ps (ESZ14 +0.48%) this morning are up +4.50 points (+0.23%). The S&P 500 index on Wednesday posted a 1-1/2 week high early but fell back and closed lower: S&P 500 -0.73%, Dow Jones -0.92%, Nasdaq -0.55%. Bearish factors included (1) terrorism concerns that fueled long liquidation in stocks after the Canadian Parliament was locked down when a Canadian soldier was shot at a war memorial in Ottawa and "multiple suspects" were reported loose inside the parliament building, and (2) a slide in energy producers after crude prices fell. The S&P 500 had posted a 1-1/2 week high on strong stock earnings results as 79% of reporting S&P 500 companies have exceeded estimates and 63% have also exceeded sales projections.
Dec 10-year T-notes (ZNZ14 -0.09%) this morning are down -1.5 ticks. Dec 10-year T-note futures prices on Wednesday slipped to a 1-week low and closed lower. Closes: TYZ4 -7.50, FVZ4 -5.00. Bearish factors included (1) the larger-than-expected increase in Sep U.S. CPI, which eases deflation concerns and dampens speculation the Fed will delay in raising interest rates, and (2) carry-over weakness from a slide in German bunds after comments from ECB Governing Council member Luc Coene dampened speculation the ECB will expand monetary easing when he said "it's too early to say if we'll adopt additional stimulus measures."
The dollar index (DXY00 unch) this morning is down -0.033 (-0.04%). EUR/USD (^EURUSD) is up +0.0019 (+0.15%). USD/JPY (^USDJPY) is up +0.35 (+0.33%) at a 1-1/2 week high. The dollar index on Wednesday closed higher on reduced deflation concerns after U.S Sep CPI rose more than expected, which bolsters the case for Fed interest rate hikes. Closes: Dollar index +0.438 (+0.51%), EUR/USD -0.0068 (-0.53%), USD/JPY +0.146 (+0.14%). EUR/USD remains under pressure on speculation that a slowdown in the Eurozone will prompt the ECB to expand stimulus measures.
Dec WTI crude oil (CLZ14 +0.24%) this morning is up +23 cents (+0.29%) and Dec gasoline (RBZ14 +0.20%) is up +0.0049 (+0.23%). Dec crude and Dec gasoline on Wednesday closed lower. Closes: CLZ4 -1.97 (-2.39%), RBZ4 -0.0469 (-2.18%). Bearish factors included (1) a rally in the dollar index, (2) the +7.1 million bbl surge in weekly EIA inventories to a 3-month high of 377.7 million bbl, over double expectations of a +3.0 million bbl build, and (3) the +953,000 bbl increase in crude supplies at Cushing, OK, the delivery point of WTI futures.
GLOBAL EVENT CALENDAR10/23/2014
|US||0830 ET||Weekly initial unemployment claims expected +17,000 to 281,000, previous -23,000 to 264,000. Weekly continuing claims expected -9,000 to 2.380 million, previous +7,000 to 2.389 million.|
|0830 ET||Sep Chicago Fed national activity index expected +0.36 to 0.15, Aug -0.21.|
|0830 ET||USDA weekly Export Sales.|
|0900 ET||Aug FHFA house price index expected +0.3% m/m, Jul +0.1% m/m.|
|0945 ET||Preliminary Oct Markit manufacturing PMI expected -0.5 to 57.0, Sep -0.4 to 57.5.|
|1000 ET||Sep leading indicators expected +0.7%, Aug +0.2%.|
|1100 ET||Oct Kansas City Fed manufacturing activity index expected unchanged at 6, Sep +3 to 6.|
|1100 ET||Treasury announces amount of 2-year T-notes (previous $29 billion), 2-year floating-rate notes (previous $13 billion), 5-year T-notes (previous $35 billion) and 7-year T-notes (previous $29 billion) to be auctioned Oct 28-30.|
|1300 ET||Treasury auctions $7 billion 30-year TIPS.|
|GER||0330 ET||German Oct Markit/BME manufacturing PMI expected -0.4 to 49.5, Sep 49.9.|
|EUR||0400 ET||Eurozone Oct Markit composite PMI expected -0.5 to 51.5, Sep 52.0.|
|1000 ET||Eurozone Oct consumer confidence expected -0.6 to -12.0, Sep -11.4.|
|UK||0430 ET||UK Sep retail sales ex autos expected unch m/m and +3.4% y/y, Aug +0.2% m/m and +4.5% y/y.|
|0430 ET||UK Sep retail sales including autos expected -0.1% and +2.9% y/y, Aug +0.4% m/m and +3.9% y/y.|
|0600 ET||UK Oct CBI trends total orders expected +1 to -3, Sep -4. Oct CBI trends selling prices expected +1 to 0, Sep 1.|
|0600 ET||UK Oct CBI business optimism expected -4 to 15, Sep 19.|
|CHI||2130 ET||China Sep property prices.|
U.S. STOCK CALENDAR10/23/2014
|Company Name||Ticker||Time||Event Description||Period||Estimate|
|Precision Castparts Corp||PCP US||3:01||Q2 2015 Earnings Release||Q2 2015||3.321|
|Airgas Inc||ARG US||Bef-mkt||Q2 2015 Earnings Release||Q2 2015||1.295|
|Mead Johnson Nutrition Co||MJN US||Bef-mkt||Q3 2014 Earnings Release||Q3 2014||0.904|
|American Electric Power Co Inc||AEP US||Bef-mkt||Q3 2014 Earnings Release||Q3 2014||1.009|
|Dr Pepper Snapple Group Inc||DPS US||Bef-mkt||Q3 2014 Earnings Release||Q3 2014||0.877|
|Diamond Offshore Drilling Inc||DO US||Bef-mkt||Q3 2014 Earnings Release||Q3 2014||0.788|
|Nielsen NV||NLSN US||Bef-mkt||Q3 2014 Earnings Release||Q3 2014||0.652|
|PulteGroup Inc||PHM US||Bef-mkt||Q3 2014 Earnings Release||Q3 2014||0.364|
|Bemis Co Inc||BMS US||Bef-mkt||Q3 2014 Earnings Release||Q3 2014||0.673|
|T Rowe Price Group Inc||TROW US||Bef-mkt||Q3 2014 Earnings Release||Q3 2014||1.146|
|Alexion Pharmaceuticals Inc||ALXN US||Bef-mkt||Q3 2014 Earnings Release||Q3 2014||1.161|
|Southwest Airlines Co||LUV US||Bef-mkt||Q3 2014 Earnings Release||Q3 2014||0.531|
|Coca-Cola Enterprises Inc||CCE US||Bef-mkt||Q3 2014 Earnings Release||Q3 2014||0.883|
|Prologis Inc||PLD US||Bef-mkt||Q3 2014 Earnings Release||Q3 2014||0.461|
|Lorillard Inc||LO US||Bef-mkt||Q3 2014 Earnings Release||Q3 2014||0.892|
|Quest Diagnostics Inc||DGX US||Bef-mkt||Q3 2014 Earnings Release||Q3 2014||1.075|
|Union Pacific Corp||UNP US||Bef-mkt||Q3 2014 Earnings Release||Q3 2014||1.51|
|EQT Corp||EQT US||Bef-mkt||Q3 2014 Earnings Release||Q3 2014||0.501|
|Sigma-Aldrich Corp||SIAL US||Bef-mkt||Q3 2014 Earnings Release||Q3 2014||1.058|
|Celgene Corp||CELG US||Bef-mkt||Q3 2014 Earnings Release||Q3 2014||0.947|
|General Motors Co||GM US||Bef-mkt||Q3 2014 Earnings Release||Q3 2014||0.952|
|Eli Lilly & Co||LLY US||Bef-mkt||Q3 2014 Earnings Release||Q3 2014||0.665|
|Zimmer Holdings Inc||ZMH US||7:00||Q3 2014 Earnings Release||Q3 2014||1.301|
|Occidental Petroleum Corp||OXY US||7:00||Q3 2014 Earnings Release||Q3 2014||1.586|
|Raytheon Co||RTN US||7:00||Q3 2014 Earnings Release||Q3 2014||1.6|
|Comcast Corp||CMCSA US||7:00||Q3 2014 Earnings Release||Q3 2014||0.707|
|Under Armour Inc||UA US||7:00||Q3 2014 Earnings Release||Q3 2014||0.399|
|3M Co||MMM US||7:30||Q3 2014 Earnings Release||Q3 2014||1.961|
|Caterpillar Inc||CAT US||7:30||Q3 2014 Earnings Release||Q3 2014||1.34|
|Cameron International Corp||CAM US||7:30||Q3 2014 Earnings Release||Q3 2014||1.09|
|Zimmer Holdings Inc||ZMH US||8:00||Q3 2014 Earnings Call||Q3 2014|
|CMS Energy Corp||CMS US||8:00||Q3 2014 Earnings Release||Q3 2014||0.385|
|Nielsen NV||NLSN US||8:30||Q3 2014 Earnings Call||Q3 2014|
|PulteGroup Inc||PHM US||8:30||Q3 2014 Earnings Call||Q3 2014|
|CMS Energy Corp||CMS US||8:30||Q3 2014 Earnings Call||Q3 2014|
|Quest Diagnostics Inc||DGX US||8:30||Q3 2014 Earnings Call||Q3 2014|
|Equifax Inc||EFX US||8:30||Q3 2014 Earnings Call||Q3 2014|
|Comcast Corp||CMCSA US||8:30||Q3 2014 Earnings Call||Q3 2014|
|Under Armour Inc||UA US||8:30||Q3 2014 Earnings Call||Q3 2014|
|Union Pacific Corp||UNP US||8:45||Q3 2014 Earnings Call||Q3 2014|
|3M Co||MMM US||9:00||Q3 2014 Earnings Call||Q3 2014|
|American Electric Power Co Inc||AEP US||9:00||Q3 2014 Earnings Call||Q3 2014|
|Nucor Corp||NUE US||9:00||Q3 2014 Earnings Release||Q3 2014||0.754|
|Diamond Offshore Drilling Inc||DO US||9:00||Q3 2014 Earnings Call||Q3 2014|
|Raytheon Co||RTN US||9:00||Q3 2014 Earnings Call||Q3 2014|
|Celgene Corp||CELG US||9:00||Q3 2014 Earnings Call||Q3 2014|
|Leggett & Platt Inc||LEG US||9:00||Q3 2014 Earnings Call||Q3 2014|
|Eli Lilly & Co||LLY US||9:00||Q3 2014 Earnings Call||Q3 2014|
|Mead Johnson Nutrition Co||MJN US||9:30||Q3 2014 Earnings Call||Q3 2014|
|Cameron International Corp||CAM US||9:30||Q3 2014 Earnings Call||Q3 2014|
|Airgas Inc||ARG US||10:00||Q2 2015 Earnings Call||Q2 2015|
|Occidental Petroleum Corp||OXY US||10:00||Q3 2014 Earnings Call||Q3 2014|
|Precision Castparts Corp||PCP US||10:00||Q2 2015 Earnings Call||Q2 2015|
|Alexion Pharmaceuticals Inc||ALXN US||10:00||Q3 2014 Earnings Call||Q3 2014|
|Coca-Cola Enterprises Inc||CCE US||10:00||Q3 2014 Earnings Call||Q3 2014|
|General Motors Co||GM US||10:00||Q3 2014 Earnings Call||Q3 2014|
|EQT Corp||EQT US||10:30||Q3 2014 Earnings Call||Q3 2014|
|Dr Pepper Snapple Group Inc||DPS US||11:00||Q3 2014 Earnings Call||Q3 2014|
|Bemis Co Inc||BMS US||11:00||Q3 2014 Earnings Call||Q3 2014|
|Caterpillar Inc||CAT US||11:00||Q3 2014 Earnings Call||Q3 2014|
|Torchmark Corp||TMK US||11:00||Q3 2014 Earnings Call||Q3 2014|
|O'Reilly Automotive Inc||ORLY US||11:00||Q3 2014 Earnings Call||Q3 2014|
|Prologis Inc||PLD US||12:00||Q3 2014 Earnings Call||Q3 2014|
|Southwest Airlines Co||LUV US||12:30||Q3 2014 Earnings Call||Q3 2014|
|Nucor Corp||NUE US||14:00||Q3 2014 Earnings Call||Q3 2014|
|Edwards Lifesciences Corp||EW US||16:00||Q3 2014 Earnings Release||Q3 2014||0.717|
|Principal Financial Group Inc||PFG US||16:00||Q3 2014 Earnings Release||Q3 2014||1.058|
|Stericycle Inc||SRCL US||16:02||Q3 2014 Earnings Release||Q3 2014||1.058|
|VeriSign Inc||VRSN US||16:05||Q3 2014 Earnings Release||Q3 2014||0.688|
|Altera Corp||ALTR US||16:15||Q3 2014 Earnings Release||Q3 2014||0.372|
|KLA-Tencor Corp||KLAC US||16:15||Q1 2015 Earnings Release||Q1 2015||0.463|
|Cerner Corp||CERN US||16:30||Q3 2014 Earnings Call||Q3 2014|
|VeriSign Inc||VRSN US||16:30||Q3 2014 Earnings Call||Q3 2014|
|Altera Corp||ALTR US||16:45||Q3 2014 Earnings Call||Q3 2014|
|Chubb Corp/The||CB US||17:00||Q3 2014 Earnings Call||Q3 2014|
|Amazon.com Inc||AMZN US||17:00||Q3 2014 Earnings Call||Q3 2014|
|Stericycle Inc||SRCL US||17:00||Q3 2014 Earnings Call||Q3 2014|
|Edwards Lifesciences Corp||EW US||17:00||Q3 2014 Earnings Call||Q3 2014|
|Juniper Networks Inc||JNPR US||17:00||Q3 2014 Earnings Call||Q3 2014|
|KLA-Tencor Corp||KLAC US||17:00||Q1 2015 Earnings Call||Q1 2015|
|Chubb Corp/The||CB US||Aft-mkt||Q3 2014 Earnings Release||Q3 2014||1.949|
|Southwestern Energy Co||SWN US||Aft-mkt||Q3 2014 Earnings Release||Q3 2014||0.521|
|Flowserve Corp||FLS US||Aft-mkt||Q3 2014 Earnings Release||Q3 2014||0.993|
|Amazon.com Inc||AMZN US||Aft-mkt||Q3 2014 Earnings Release||Q3 2014||-0.747|
|Juniper Networks Inc||JNPR US||Aft-mkt||Q3 2014 Earnings Release||Q3 2014||0.355|
|Microsoft Corp||MSFT US||Aft-mkt||Q1 2015 Earnings Release||Q1 2015||0.551|
|Cerner Corp||CERN US||Aft-mkt||Q3 2014 Earnings Release||Q3 2014||0.422|
|Microsoft Corp||MSFT US||17:30||Q1 2015 Earnings Call||Q1 2015|
|Regeneron Pharmaceuticals Inc||REGN US||PDUFA, Eylea, branch retinal vein occlusion (OTC:BRVO)|