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Morning Call 12/8

|Includes: AAL, ALR, AMTD, ATH, AVGO, BHGE, BKNG, CASY, CMS, CMTL, COO, DELL, EW, GE, GLW, HLT, HRB, Ichor Holdings, Ltd. (ICHR), LLL, LULU, MTN, NLSN, OLLI, PANW, PFG, SAVE, TLRD, TTC, UAL, UGI, UNFI, VRNT, VRSK, VYGR
Barchart Morning Call


Barchart.com - 4 minutes ago

OVERNIGHT MARKETS AND NEWS

Dec E-mini S&Ps (ESZ16 +0.10%) are up +0.02% and European stocks are up +0.30% at an 11-month high as the markets expect the ECB later today to announce an extension of its QE program. Government bond prices fell and EUR/USD (^EURUSD) rose to a 3-week high on speculation the ECB may also announce a slower pace of asset purchases and that this will be the last extension of QE before the ECB starts to taper its bond buying. The weaker dollar has boosted crude oil prices with Jan WTI crude (CLF17 +0.86%) up +0.78%, which has also lifted energy producing stocks. Stock markets around the world also rose on signs of economic strength in China after China Nov exports unexpectedly rose for the first time in 8 months and after China imports posted their largest increase in 2 years. Asian stocks settled mostly higher: Japan +1.45%, Hong Kong +0.27%, China -0.21%, Taiwan +1.21%, Australia +1.20%, Singapore -0.03%, South Korea +2.21%, India +1.74%. Japan's Nikkei Stock Index climbed to an 11-month high as strength in Chinese Nov imports boosted exporter stocks.

The dollar index (DXY00 -0.34%) is down -0.28% at a 3-week low. EUR/USD (^EURUSD) is up +0.31% at a 3-week high. USD/JPY (^USDJPY) is down -0.29%.

Mar 10-year T-note prices (ZNH17 -0.18%) are down -7 ticks.

China Nov exports unexpectedly rose +0.1% y/y, stronger than expectations of -5.0% y/y and the first increase in 8 months. Nov imports unexpectedly rose +6.7% y/y, stronger than expectations of -1.9% y/y and the biggest increase in 2 years.

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) weekly initial unemployment claims (expected -13,000 to 255,000, previous +17,000 to 268,000) and continuing claims (expected -33,000 to 2.048 million, previous +38,000 to 2.081 million), (2) USDA weekly Export Sales.

Russell 1000 earnings reports today include: Toro (consensus $0.22), Cooper Cos (2.25), Broadcom (3.36).

U.S. IPO's scheduled to price today: Ichor Holdings (NASDAQ:ICHR), Athene Holding (NYSE:ATH).

Equity conferences during the remainder of this week include: Citi Global Health Care Conference on Wed-Thu, Barclays Global Technology, Media and Telecommunications Conference on Wed-Thu, Bernstein Consumer Summit on Wed-Thu, Capital One Southcoast Energy Conference on Wed-Thu, ACI European Biopolymer Summit on Thu.

OVERNIGHT U.S. STOCK MOVERS

L-3 Communications Holdings (LLL +1.96%) was downgraded to 'Neutral' from 'Buy' at Bank of America/Merrill Lynch with a price target of $170.

Priceline.com (PCLN +1.48%) was rated a new 'Buy' at CLSA with a price target of $1,900.

Tailored Brands (TLRD +3.39%) was upgraded to 'Buy' from 'Neutral' at Mizuho Securities with a 12-month target price of $25.

Lululemon Athletica (LULU +4.54%) surged 13% in after-hours trading after it reported Q3 adjusted EPS of 47 cents, higher than consensus of 43 cents, and then said its board approved up to $100 million in stock repurchases.

Ollie's Bargain Outlet Holdings (OLLI +1.11%) fell over 2% in after-hours trading after it reported Q3 comparable store sales rose +1.8%, below consensus of +2.1%.

Corning (GLW +2.46%) gained over 1% in after-hours trading after it announced a new $4 billion share repurchase program.

United Natural Foods (UNFI +0.88%) slid over 2% in after-hours trading after it reported Q1 EPS of 58 cents, below consensus of 62 cents.

Verint Systems (VRNT +0.26%) tumbled over 12% in after-hours trading after it reported Q3 adjusted EPS of 59 cents, weaker than consensus of 70 cents, and then lowered guidance on fiscal 2017 adjusted EPS to $2.50, below a September 7 view of $2.85.

Comtech (CMTL +6.43%) dropped 7% in after-hours trading after it reported Q1 revenue of $135.8 million, below consensus of $139.2 million, and then cut its quarterly dividend to 10 cents a share from 30 cents a share.

H&R Block (HRB +2.86%) jumped nearly 6% in after-hours trading after it reported Q2 revenue of $131.3 million, higher than consensus of $127 million.

Casey's General Stores (CASY +0.93%) fell over 2% in after-hours trading after it reported Q2 EPS of $1.44, below consensus of $1.57.

Voyager Therapeutics (VYGR -1.93%) surged over 30% in after-hours trading after it announced positive results on its phase 1b trial of its VY-AADC01 gene therapy that showed improved measures of motor function in in patients with advanced Parkinson's disease.

MARKET COMMENTS

Dec E-mini S&Ps (ESZ16 +0.10%) this morning are up +0.50 of a point (+0.02%). Wednesday's closes: S&P 500 +1.32%, Dow Jones +1.55%, Nasdaq +1.32%. The S&P 500 on Wednesday pushed up to a new record high and closed higher on carry-over support from a rally in European stocks to a 7-1/4 month high on expectations that the ECB on Thursday will extend QE past March 2017. Stocks were also boosted by reduced interest rate concerns as the 10-year T-note yield fell -4 bp.

Mar 10-year T-notes (ZNH17 -0.18%) this morning are down -7 ticks. Wednesday's closes: TYH7 +11.00, FVH7 +7.00. Mar 10-year T-notes on Wednesday closed higher on the -2.28% slide in crude oil prices, which undercut inflation expectations. T-notes were also boosted by carry-over support from a rally in German bunds ahead of Thursday's ECB meeting.

The dollar index (DXY00 -0.34%) this morning is down -0.284 (-0.28%) at a 3-week low. EUR/USD (^EURUSD) is up +0.0033 (+0.31%) at a 3-week high. USD/JPY (^USDJPY) is down -0.33 (-0.29%). Wednesday's closes: Dollar index -0.260 (-0.26%), EUR/USD +0.0035 (+0.33%), USD/JPY -0.25 (-0.22%). The dollar index on Wednesday closed lower on a -4 bp decline in the 10-year T-note yield, which reduced the dollar's interest rate differentials. In addition, there was strength in EUR/USD on short-covering ahead of Thursday's ECB meeting.

Jan WTI crude oil prices (CLF17 +0.86%) this morning are up +39 cents (+0.78%) and Jan gasoline (RBF17 -0.20%) is -0.0038 (-0.25%). Wednesday's closes: Jan crude -1.16 (-2.28%), Jan gasoline -0.0291 (-1.89%). Jan crude oil and gasoline on Wednesday closed lower on the +3.783 million bbl increase in crude stockpiles at Cushing to a 5-1/2 month high and on the +3.425 million bbl increase in weekly EIA gasoline supplies, a larger increase than expectations of +1.6 million bbl.

GLOBAL EVENT CALENDAR12/08/2016

    Thursday, Dec 8
US 0830 ET Weekly initial unemployment claims expected -13,000 to 255,000, previous +17,000 to 268,000. Weekly continuing claims expected -33,000 to 2.048 million, previous +38,000 to 2.081 million.
  0830 ET USDA weekly Export Sales.
  1100 ET Treasury announces amount of 3-year T-notes (previous $24 billion), 10-year T-notes (previous $23 billion) and 30-year T-bonds (previous $15 billion) to be auctioned Dec 12-13.
    Friday, Dec 9
US 1000 ET Revised Oct wholesale inventories expected -0.4%, prelim-Oct -0.4%. Oct wholesale trade sales expected +0.7% m/m, Sep +0.2%.
  1000 ET Preliminary-Dec University of Michigan U.S. consumer sentiment index expected +0.7 to 94.5, Nov +6.6 to 93.8.
  1200 ET USDA WASDE Dec crop production.

U.S. STOCK CALENDAR12/08/2016

Company Ticker Time Event Description Period Estimate
Dell Technologies Inc Class V DVMT US Bef-mkt Q3 2017 Earnings Release Q3 2017  
Toro Co/The TTC US 7:30 Q4 2016 Earnings Release Q4 2016 0.216
Principal Financial Group Inc PFG US 8:00 Roadshow Y 2016  
Hilton Worldwide Holdings Inc HLT US 8:00 Investor Day Y 2016  
Nielsen Holdings PLC NLSN US 8:00 Analyst Day Y 2016  
Dell Technologies Inc Class V DVMT US 8:00 Q3 2017 Earnings Call Q3 2017  
CMS Energy Corp CMS US 8:30 Investor Meeting    
UGI Corp UGI US 8:30 Investor Day Y 2016  
Verisk Analytics Inc VRSK US 8:30 Investor Day Y 2016  
Baker Hughes Inc BHI US 9:00 Investor Meeting Y 2016  
General Electric Co GE US 9:00 Investor Meeting Y 2016  
Edwards Lifesciences Corp EW US 9:00 Investor Meeting Y 2016  
Casey's General Stores Inc CASY US 10:30 Q2 2017 Earnings Call Q2 2017  
Toro Co/The TTC US 11:00 Q4 2016 Earnings Call Q4 2016  
Palo Alto Networks Inc PANW US 13:00 Annual General Meeting    
Cooper Cos Inc/The COO US 16:15 Q4 2016 Earnings Release Q4 2016 2.248
Cooper Cos Inc/The COO US 17:00 Q4 2016 Earnings Call Q4 2016  
Broadcom Ltd AVGO US 17:00 Q4 2016 Earnings Call Q4 2016  
Broadcom Ltd AVGO US Aft-mkt Q4 2016 Earnings Release Q4 2016 3.358
American Airlines Group Inc AAL US   November 2016 Sales and Revenue Release - Traffic Results 2016  
Vail Resorts Inc MTN US   Annual General Meeting    
TD Ameritrade Holding Corp AMTD US   November 2016 Sales and Revenue Release 2016  
Spirit Airlines Inc SAVE US   November 2016 Sales and Revenue Release - Traffic Results 2016  
Alere Inc ALR US   Annual General Meeting    
United Continental Holdings Inc UAL US   November 2016 Sales and Revenue Release - Traffic Results 2016