Tuesday, February 10th, 2015
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OVERNIGHT MARKETS AND NEWS
March E-mini S&Ps (ESH15 +0.64%) this morning are up +0.18% and European stocks are up +0.60% on speculation Greece and its international creditors will work toward an agreement on Greece's debt financing. Greek Prime Minister Tsipras is set to hold talks on Wednesday at an emergency meeting with Eurozone finance ministers in Brussels. According to an unnamed official representing the creditors, Greece has shifted toward a more cooperative tone in recent conversations with the troika. Two other troika officials said Greece may be given more time to present its complete proposals for a permanent arrangement if Greek Prime Minister Tsipras accepts he needs a new program and commits not to reverse the most important overhauls of the previous bailout agreement. Asian stocks closed mixed: Japan -0.33%, Hong Kong +0.03%, China +1.82%, Taiwan -0.30%, Australia -0.25%, Singapore +0.47%, South Korea -0.64%, India +0.45%. Chinese stocks closed higher on speculation that disinflation concerns will afford the government more room to ease monetary policy after China Jan CPI rose at the slowest pace in 5 years. Commodity prices are mostly lower. Mar crude oil (CLH15 -1.02%) is down -1.21% and Mar gasoline (RBH15 -0.29%) is down -0.65%. Apr gold (GCJ15 -0.51%) is down -0.39%. Mar copper (HGH15 -1.71%) is down -1.88%. Agriculture prices are lower ahead of the USDA's Feb WASDE crop production report. The dollar index (DXY00 +0.26%) is up +0.39%. EUR/USD (^EURUSD) is down -0.42%. USD/JPY (^USDJPY) is up +0.27%. Mar T-note prices (ZNH15 -0.27%) are down -7.5 ticks at a 1-week low ahead of the Treasury's $24 billion 3-year auction later today.
China Jan CPI rose at an +0.8% y/y pace, less than expectations of +1.0% y/y and the slowest pace of increase in 5 years. Jan PPI fell at a -4.3% y/y pace, a steeper drop than expectations of -3.8% y/y and the fastest pace of decline in 5-1/4 years.
UK Jan BRC sales like-for like rose +0.2% y/y, less than expectations of +0.5% y/y.
UK Dec industrial production fell -0.2% m/m, a bigger decline than expectations of -0.1% m/m. On an annual basis, Dec industrial production rose +0.5% y/y, right on expectations.
UK Dec manufacturing production rose +0.1% m/m and +2.4% y/y, better than expectations of -0.1% m/m and +2.0% y/y.
The Japan Dec tertiary industry index unexpectedly fell -0.3% m/m, weaker than expectations of unch m/m and matched the July 2014 decline as the largest decrease in 8 months.
U.S. STOCK PREVIEW
Today's Dec JOLTS job openings report is expected to show an +18,000 increase to 4.990 million, thus extending November's sharp +142,000 increase to a 13-3/4 year high 4.972 million. The Treasury today will sell $24 billion of 3-year T-notes. There are 18 of the S&P 500 companies that report earnings today with notable reports including: Coca-Cola Co (consensus $0.42), Martin Marietta Materials (0.82), Rengeneron (2.82), Wyndham (0.84), Molson Coors (0.69), CVS Health (1.20), Genworth Financial (-0.19).
Equity conferences during the remainder of this week include: Stifel, Nicolaus Technology, Internet & Media Conference on Mon-Tue, BIO CEO & Investor Conference on Tue, Credit Suisse Financial Services Forum on Tue-Wed, Stifel Transportation and Logistics Conference on Tue-Wed, Goldman Sachs Technology & Internet Conference on Tue-Thu, Aviation Festival Asia on Wed-Thu, Bank of America Merrill Lynch Insurance Conference on Wed-Thu, Leerink Swann Global Health Care Conference on Wed-Thu, Bank of America Merrill Lynch Rates and Currencies Risk Management Conference on Wed-Thu, BB&T Capital Markets Transportation Services Conference on Wed-Thu, and Morgan Stanley Chemicals Corporate Access Day on Thu.
OVERNIGHT U.S. STOCK MOVERS
Starwood Hotels & Resorts Worldwide (HOT -0.60%) reported Q4 EPS of 97 cents, better than consensus of 76 cents.
Reynolds American (RAI -0.80%) reported Q4 EPS of 87 cents, right on consensus.
Regeneron Pharmaeuticals (REGN -1.75%) reported Q4 EPS of $2.79, below consensus of $2.82.
Wyndham Worldwide (WYN -1.27%) reported Q4 EPS of 90 cents, higher than consensus of 84 cents.
Molson Coors Brewing (TAP -1.06%) reported Q4 EPS of 55 cents, below consensus of 69 cents.
Bank of NY Mellon reported 7.72% passive stake in Dun & Bradstreet (DNB -1.78%) .
Crown Holdings (CCK -0.72%) reported Q4 adjusted EPS of 48 cents, right on consensus.
Molina Healthcare (MOH -2.36%) reported Q4 EPS of 69 cents, higher than consensus of 61 cents.
Franklin Resources reported a 5.7% passive stake in Sensient (SXT -5.61%) .
Aeropostale (ARO +5.18%) surged over 15% in after-hours trading after it reported Q4 revenue of $594.5 million, better than consensus of $577.67 million, and then raised guidance on Q4 EPS to a loss of -1 cent to -6 cents, better than consensus of -27 cents.
Urban Outfitters (URBN -0.44%) rose over 7% in after-hours trading after it reported Q4 revenue of $1.01 billion, above consensus of $997.69 million.
The Gap (GPS -1.65%) fell over 1% in after-hours trading after it reported January same-store-sales were down 3% versus positive 1% last year.
Mar E-mini S&Ps (ESH15 +0.64%) this morning are up +3.75 points (+0.18%). The S&P 500 index on Monday closed lower: S&P 500 -0.42%, Dow Jones -0.53%, Nasdaq -0.30%. Negative factors included (1) carry-over weakness from a slide in European stocks on Greek default concerns after Greek Prime Minister Tsipras vowed to negotiate an end to his country's austerity measures, and (2) concerns about a global economic slowdown after China Jan exports unexpectedly fell -3.3% y/y, weaker than expectations of +5.9% y/y and the lowest in 10 months.
Mar 10-year T-notes (ZNH15 -0.27%) this morning are down -7.5 ticks at a 1-week low. Mar 10-year T-note futures prices on Monday closed lower. Closes: TYH5 -3.50, FVH5 -3.25. Bearish factors included (1) negative carry-over from Friday's stronger-than-expected U.S. Jan payrolls report that brings the Fed closer to raising interest rates, and (2) supply pressures with the Treasury set to auction $64 billion of T-notes and T-bonds in the week's Feb quarterly refunding.
The dollar index (DXY00 +0.26%) this morning is up +0.367 (+0.39%). EUR/USD (^EURUSD) is down -0.0048 (-0.42%). USD/JPY (^USDJPY) is up +0.32 (+0.27%). The dollar index on Monday closed lower: Dollar index -0.249 (-0.26%), EUR/USD +0.0014 (+0.12%), USD/JPY -0.486 (-0.41%). Bearish factors included (1) strength in EUR/USD which recovered from a 1-week low and closed higher after Eurozone Feb Sentix investor confidence rose to a 9-month high, and (2) comments from Treasury Secretary Lew that fueled long liquidation in the dollar when he said that the strength of the dollar will be discussed at the G-20 meeting currently underway in Istanbul.
Mar WTI crude oil (CLH15 -1.02%) this morning is down -64 cents (-1.21%) and Mar gasoline (RBH15 -0.29%) is down -0.0103 (-0.65%). Mar crude oil and Mar gasoline on Monday closed higher: CLH5 +1.17 (+2.26%), RBH5 +0.0147 (+0.94%). Bullish factors included (1) the weaker dollar, (2) carry-over support from Friday's data from Baker Hughes that showed operating U.S. oil rigs in the week ended Feb 6 fell to a 3-1/4 year low of 1,140, and (3) the ongoing strike by the United Steelworkers union, which represents employees at more than 200 refineries and 10% of U.S. refining output, which may lead to reduced gasoline and distillate output.
GLOBAL EVENT CALENDAR02/10/2015
|US||0815 ET||Richmond Fed President Jeffrey Lacker speaks on the economy at an event in Raleigh, North Carolina.|
|1000 ET||Dec wholesale inventories expected +0.1% m/m, Nov +0.8% m/m. Dec wholesale trade sales, Nov -0.3% m/m.|
|1000 ET||Dec JOLTS job openings expected +18,000 to 4.990 million, Nov +142,000 to 4.972 million.|
|1200 ET||USDA Feb WASDE crop production.|
|1300 ET||Treasury auctions $24 billion 3-year T-notes.|
|EUR||0400 ET||ECB Chief Economist and Bank of Portugal Governor Peter Praet and ECB Governing Council member Carlos Costa speak at a conference in Lisbon on Financial Stability and Macro-Prudential Policy.|
|UK||0430 ET||UK Dec industrial production expected -0.1% m/m and +0.5% y/y, Nov -0.1% m/m and +1.1% y/y.|
|0430 ET||UK Dec manufacturing production expected -0.1% m/m and +2.0% y/y, Nov +0.7% m/m and +2.7% y/y.|
U.S. STOCK CALENDAR02/10/2015
|Martin Marietta Materials Inc||MLM US||Bef-mkt||Q4 2014 Earnings Release||Q4 2014||0.821|
|Omnicom Group Inc||OMC US||Bef-mkt||Q4 2014 Earnings Release||Q4 2014||1.254|
|PG&E Corp||PCG US||Bef-mkt||Q4 2014 Earnings Release||Q4 2014||0.66|
|Regeneron Pharmaceuticals Inc||REGN US||Bef-mkt||Q4 2014 Earnings Release||Q4 2014||2.816|
|Wyndham Worldwide Corp||WYN US||Bef-mkt||Q4 2014 Earnings Release||Q4 2014||0.844|
|Coca-Cola Co/The||KO US||Bef-mkt||Q4 2014 Earnings Release||Q4 2014||0.421|
|Molson Coors Brewing Co||TAP US||Bef-mkt||Q4 2014 Earnings Release||Q4 2014||0.688|
|HCP Inc||HCP US||Bef-mkt||Q4 2014 Earnings Release||Q4 2014||0.77|
|Starwood Hotels & Resorts Worldwide Inc||HOT US||Bef-mkt||Q4 2014 Earnings Release||Q4 2014||0.755|
|Reynolds American Inc||RAI US||Bef-mkt||Q4 2014 Earnings Release||Q4 2014||0.869|
|CVS Health Corp||CVS US||Bef-mkt||Q4 2014 Earnings Release||Q4 2014||1.203|
|Sealed Air Corp||SEE US||7:00||Q4 2014 Earnings Release||Q4 2014||0.474|
|Dun & Bradstreet Corp/The||DNB US||8:00||Q4 2014 Earnings Call||Q4 2014|
|Omnicom Group Inc||OMC US||8:30||Q4 2014 Earnings Call||Q4 2014|
|Regeneron Pharmaceuticals Inc||REGN US||8:30||Q4 2014 Earnings Call||Q4 2014|
|Wyndham Worldwide Corp||WYN US||8:30||Q4 2014 Earnings Call||Q4 2014|
|Sealed Air Corp||SEE US||8:30||Q4 2014 Earnings Call||Q4 2014|
|CVS Health Corp||CVS US||8:30||Q4 2014 Earnings Call||Q4 2014|
|Reynolds American Inc||RAI US||9:00||Q4 2014 Earnings Call||Q4 2014|
|Coca-Cola Co/The||KO US||9:30||Q4 2014 Earnings Call||Q4 2014|
|Starwood Hotels & Resorts Worldwide Inc||HOT US||10:30||Q4 2014 Earnings Call||Q4 2014|
|PG&E Corp||PCG US||11:00||Q4 2014 Earnings Call||Q4 2014|
|Molson Coors Brewing Co||TAP US||11:00||Q4 2014 Earnings Call||Q4 2014|
|HCP Inc||HCP US||12:00||Q4 2014 Earnings Call||Q4 2014|
|Molson Coors Brewing Co||TAP US||13:00||Q4 2014 Earnings Call - Follow-up Session||C4 2014|
|Martin Marietta Materials Inc||MLM US||14:00||Q4 2014 Earnings Call||Q4 2014|
|Western Union Co/The||WU US||16:00||Q4 2014 Earnings Release||Q4 2014||0.339|
|Akamai Technologies Inc||AKAM US||16:30||Q4 2014 Earnings Call||Q4 2014|
|Western Union Co/The||WU US||16:30||Q4 2014 Earnings Call||Q4 2014|
|Cerner Corp||CERN US||16:30||Q4 2014 Earnings Call||Q4 2014|
|Pioneer Natural Resources Co||PXD US||Aft-mkt||Q4 2014 Earnings Release||Q4 2014||0.936|
|FMC Technologies Inc||FTI US||Aft-mkt||Q4 2014 Earnings Release||Q4 2014||0.785|
|Genworth Financial Inc||GNW US||Aft-mkt||Q4 2014 Earnings Release||Q4 2014||-0.194|
|Akamai Technologies Inc||AKAM US||Aft-mkt||Q4 2014 Earnings Release||Q4 2014||0.633|
|Cerner Corp||CERN US||Aft-mkt||Q4 2014 Earnings Release||Q4 2014||0.467|