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Morning Call 8/2

|Includes: AAPL, ALL, BGFV, COHR, CRVS, FEYE, FISV, FTR, HBI, HLF, ILMN, MTSI, SWKS, ULTI, Venator Materials (VNTR)

Summary

IPOs

News

Earnings calls

Barchart Morning Call

Barchart.comWed Aug 2, 6:36AM CDT

OVERNIGHT MARKETS AND NEWS

Sep E-mini S&Ps (ESU17 +0.02%) this morning are up +0.06% due to strength in technology stocks as shares of Apple rally 6% in pre-market trading after it gave an upbeat revenue forecast ahead of the launch of its new iPhone next quarter. Apple suppliers Cirrus Logic and Skyworks Solutions are also up 3% in pre-market trading. European stocks are down -0.14% as exporter stocks decline after EUR/USD (^EURUSD) climbed to a new 2-1/2 year high, which undercuts European exporters' earnings prospects. Asian stocks settled mixed: Japan +0.47%, Hong Kong +0.24%, China -0.23%, Taiwan +0.79%, Australia -0.49%, Singapore +0.32%, South Korea +0.21%, India -0.30%. A rally in technology stocks in Asia after Apple's upbeat revenue forecast sent China's Shanghai Composite up to a 2-1/2 year high, although losses in raw-material producing stocks spurred long liquidation and the Shanghai Composite gave up its gains and closed lower.

The dollar index (DXY00 -0.07%) is down -0.07%. EUR/USD (^EURUSD) is up +0.25% at a 2-1/2 year high. USD/JPY (^USDJPY) is up +0.34%.

Sep 10-year T-note prices (ZNU17 -0.14%) are down -4.5 ticks ahead of the Treasury's announcement later this morning on the size of next week's quarterly refunding.

As expected, the Reserve Bank of India (RBI) cut its repurchase rate by 25 bp to 6.00% from 6.25% in a 5-1 vote and said, "some of the upside risks to inflation have either reduced or not materialized."

Eurozone Jun PPI of -0.1% m/m and +2.5% y/y was right on expectations with the +2.5% y/y gain the smallest year-on-year increase in 6-months.

The Japan Jul consumer confidence index rose +0.5 to 43.8, stronger than expectations of +0.2 to 43.5 and a 4-month high.

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) weekly MBA mortgage applications (previous +0.4%, purchase sub-index -2.2%, refi sub-index +3.4%), (2) Jul ADP employment (expected +190,000, Jun +158,000), (3) Cleveland Fed President Lorretta Mester (non-voter) is keynote speaker at the Community Bankers Association of Ohio annual convention, (4) San Francisco Fed President John Williams (non-voter) speaks at an event in Las Vegas on “Monetary Policy’s Role in Fostering Sustainable Growth,” (5) EIA Weekly Petroleum Status Report.

Notable S&P 500 earnings reports today include: Time Warner (consensus $1.19), Exelon (0.52), Humana (3.07), Southern Co (0.71), Lincoln National (1.75), Occidental Petroleum (0.09), Prudential Financial (2.70), Williams Cos (0.20), MetLife (1.28), Fortune Brands (0.87), Marathon Oil (-0.15), Symantec (0.31), AIG (1.20).

U.S. IPO's scheduled to price today: Venator Materials (VNTR).

Equity conferences this week: UBS Transport Conference on Thu.

OVERNIGHT U.S. STOCK MOVERS

Apple (AAPL +0.89%) rallied over 6% in pre-market trading to a record high after it reported Q3 EPS of $1.67, better than consensus of $1.57, and then said it sees Q4 revenue of $49 billion-$52 billion, the midpoint well above consensus of $49.12 billion. Apple suppliers Cirrus Logic (CRUS +2.67%) and Skyworks Solutions (SWKS -0.56%) are also up 3% in pre-market trading.

Ultimate Software Group (ULTI +0.57%) tumbled 11% in after-hours trading after it reported Q2 revenue of $224.7 million, weaker than consensus of $228 million, and then said it sees Q3 revenue of $201 million-$203 million, below consensus of $245.4 million.

Illumina (ILMN -0.89%) jumped 9% in after-hours trading after it reported Q2 adjusted EPS 0of 82 cents, better than consensus of 68 cents, and then said it sees full-year adjusted EPS of $3.560-$3.70, the midpoint above consensus of $3.63.

Allstate (ALL unch) gained 2% in after-hours trading after it reported Q2 operating EPS of $1.38, well above consensus of 87 cents and said its board approved a new $2 billion share repurchase program.

Fiserv (FISV +0.60%) dropped over 2% in after-hours trading after it reported Q2 adjusted EPS of $1.19, less than consensus of $1.23, and then said it sees full-year adjusted EPS of $5.02-$5.17, the midpoint below consensus of $5.12.

Hanesbrands (HBI +0.52%) rose over 3% in after-hours trading after it said it sees full-year net sales of $6.45 billion to $6.55 billion, above consensus of $6.44 billion.

Terex (TEX -1.22%) rose 4% in after-hours trading after it raised guidance on its full-year EPS view to $1.05-$1.15 from a prior view of 80 cents-95 cents, above consensus of 98 cents.

Coherent (COHR +2.26%) sank 18% in after-hours trading after it reported Q3 net sales of $464.1 million, weaker than consensus of $467 million.

Herbalife (HLF +0.02%) lost 4% in after-hours trading after it said it sees full-year adjusted EPS of $4.30-$4.70, the midpoint below consensus of $4.62.

FireEye (FEYE +0.41%) climbed nearly 7% in after-hours trading after it reported a Q2 adjusted loss of -4 cents per share, a smaller loss than expectations of -12 cents, and then raised its 2017 revenue estimate to $734 million-$746 million from a prior view of $724 million-$736 million.

MACOM Technology Solutions Holdings (MTSI +0.84%) plunged 20% in after-hours trading after it reported Q3 adjusted EPS of 67 cents, weaker than consensus of 68 cents, and then said it sees Q4 adjusted EPS of 45 cents-50 cents, below consensus of 75 cents.

Frontier Communications (FTR +3.79%) lost nearly 6% in after-hours trading after it reported a Q2 adjusted loss per share of -$1.10, a wider loss than expectations of -$1.02.

Big 5 Sporting Goods (BGFV +1.86%) tumbled over 13% in after-hours trading after it said it expects Q3 same store sales to be in the negative low single-digit range with Q3 EPS of 22 cents-32 cents, below consensus of 39 cents.

MARKET COMMENTS

Sep S&P 500 E-mini stock futures (ESU17 +0.02%) this morning are up +1.50 points (+0.06%). Tuesday's closes: S&P 500 +0.24%, Dow Jones +0.33%, Nasdaq +0.25%. The S&P 500 on Tuesday closed higher on signs of strength in the global economy after Eurozone Q2 GDP grew at a +2.1% y/y pace, the strongest year-on-year increase in 6 years, and after the China Jul Caixin manufacturing PMI rose +0.7 to 51.1, the fastest pace of expansion in 4 months. Stocks also continued to see underlying strength from the positive Q2 earnings season. Stocks were undercut by the U.S. Jun personal income report of unchanged (weaker expectations of +0.4%) and by the unexpected -1.3% decline in U.S. Jun construction spending (weaker than expectations of +0.4%).

Sep 10-year T-note prices (ZNU17 -0.14%) this morning are down -4.5 ticks. Tuesday's closes: TYU7 +11, FVU7 +4.75. Sep 10-year T-notes on Tuesday closed higher on the unexpected stagnation in U.S. Jun personal income report of unchanged (weaker than expectations of +0.4%) and the unexpected -1.3% m/m decline in U.S. Jun construction spending. T-notes were also supported by the -2% slide in crude oil prices, which reduces inflation expectations.

The dollar index (DXY00 -0.07%) this morning is down -0.067 (-0.07%). EUR/USD (^EURUSD) is up +0.0030 (+0.25%) at a new 2-1/2 year high and USD/JPY (^USDJPY) is up +0.38 (+0.34%). Tuesday's closes: Dollar Index +0.180 (+0.19%), EUR/USD -0.0040 (-0.34%), USD/JPY +0.10 (+0.09%). The dollar index on Tuesday closed higher on weakness in the currencies of the crude-oil-exporting countries of Canada and Russia after crude oil prices tumbled -2%. The dollar also found support on U.S. Jul ISM manufacturing index report of -1.5 to 56.3, which was close to expectations and signaled that U.S. manufacturing activity remains in expansionary territory.

Sep crude oil (CLU17 -0.02%) this morning is up +7 cents (+0.14%). Sep gasoline (RBU17 +0.12%) is up +0.0034 (+0.20%). Tuesday's closes: Sep WTI crude -1.01 (-2.01%), Sep gasoline -0.0153 (-0.91%). Sep crude oil and gasoline on Tuesday closed lower on a stronger dollar and on increased OPEC crude output that may prolong the global oil glut after OPEC Jul crude production rose +210,000 bpd to 7-month high of 32.87 million bpd.

GLOBAL EVENT CALENDAR08/02/2017

Wednesday, Aug 2
US 0700 ET Weekly MBA mortgage applications, previous +0.4%, purchase sub-index -2.2%, refi sub-index +3.4%.
0815 ET Jul ADP employment change expected +190,000, Jun +158,000.
0830 ET Treasury announces amount of 3-year T-notes (previous $24 billion), 10-year T-notes (previous $20 billion) and 30-year T-bonds (previous $12 billion) to be auctioned Aug 8-10 in the Treasurys quarterly refunding.
1030 ET EIA Weekly Petroleum Status Report.
1200 ET Cleveland Fed President Lorretta Mester (non-voter) is keynote speaker at the Community Bankers Association of Ohio annual convention.
1530 ET San Francisco Fed President John Williams (non-voter) speaks at an event in Las Vegas on Monetary Policys Role in Fostering Sustainable Growth.
Thursday, Aug 3
US 0730 ET Jul Challenger job cuts, Jun -19.3% y/y.
0830 ET Weekly initial unemployment claims expected -2,000 to 242,000, previous +10,000 to 244,000. Weekly continuing claims expected -6,000 to 1.958 million, previous -13,000 to 1.964 million.
0830 ET USDA weekly Export Sales.
0945 ET Final-Jul Markit U.S. services PMI expected unch at 54.2, prelim-Jul unch at 54.2.
1000 ET Jul ISM non-manufacturing expected -0.5 to 56.9, Jun +0.5 to 57.4.
1000 ET Jun factory orders expected +3.0%, May -0.8% and -0.3% ex transportation.

U.S. STOCK CALENDAR08/02/2017

Company Ticker Time Event Description Period Estimate
GGP Inc GGP US Bef-mkt Q2 2017 Earnings Release Q2 17 0.353
Cardinal Health Inc CAH US Bef-mkt Q4 2017 Earnings Release Q4 17 1.244
Fidelity National Information Services Inc FIS US Bef-mkt Q2 2017 Earnings Release Q2 17 0.972
Vulcan Materials Co VMC US Bef-mkt Q2 2017 Earnings Release Q2 17 1.201
AMETEK Inc AME US Bef-mkt Q2 2017 Earnings Release Q2 17 0.623
Time Warner Inc TWX US Bef-mkt Q2 2017 Earnings Release Q2 17 1.19
Dominion Energy Inc D US Bef-mkt Q2 2017 Earnings Release Q2 17 0.667
AutoNation Inc AN US Bef-mkt Q2 2017 Earnings Release Q2 17 0.972
Exelon Corp EXC US Bef-mkt Q2 2017 Earnings Release Q2 17 0.524
Entergy Corp ETR US Bef-mkt Q2 2017 Earnings Release Q2 17 1.184
Garmin Ltd GRMN US Bef-mkt Q2 2017 Earnings Release Q2 17 0.809
NiSource Inc NI US Bef-mkt Q2 2017 Earnings Release Q2 17 0.101
Humana Inc HUM US 06:30 Q2 2017 Earnings Release Q2 17 3.068
Delphi Automotive PLC DLPH US 06:45 Q2 2017 Earnings Release Q2 17 1.655
Mondelez International Inc MDLZ US 07:00 Q2 2017 Earnings Release Q2 17 0.457
Southern Co/The SO US 07:30 Q2 2017 Earnings Release Q2 17 0.709
Level 3 Communications Inc LVLT US 08:00 Q2 2017 Earnings Release Q2 17 0.376
Mondelez International Inc MDLZ US 08:00 Q2 2017 Earnings Call Q2 17
Molson Coors Brewing Co TAP US 08:00 Q2 2017 Earnings Release Q2 17 2.117
Principal Financial Group Inc PFG US 08:00 Roadshow - Day 1
Assurant Inc AIZ US 08:00 Q2 2017 Earnings Call Q2 17
Cardinal Health Inc CAH US 08:30 Q4 2017 Earnings Call Q4 17
Fidelity National Information Services Inc FIS US 08:30 Q2 2017 Earnings Call Q2 17
AMETEK Inc AME US 08:30 Q2 2017 Earnings Call Q2 17
Verisk Analytics Inc VRSK US 08:30 Q2 2017 Earnings Call Q2 17
NiSource Inc NI US 08:30 Q2 2017 Earnings Call Q2 17
GGP Inc GGP US 09:00 Q2 2017 Earnings Call Q2 17
Range Resources Corp RRC US 09:00 Q2 2017 Earnings Call Q2 17
Humana Inc HUM US 09:00 Q2 2017 Earnings Call Q2 17
FMC Corp FMC US 09:00 Q2 2017 Earnings Call Q2 17
EOG Resources Inc EOG US 09:00 Q2 2017 Earnings Call Q2 17
Allstate Corp/The ALL US 09:00 Q2 2017 Earnings Call Q2 17
Delphi Automotive PLC DLPH US 09:00 Q2 2017 Earnings Call Q2 17
Dominion Energy Inc D US 09:00 Q2 2017 Earnings Call Q2 17
Pioneer Natural Resources Co PXD US 10:00 Q2 2017 Earnings Call Q2 17
Boston Properties Inc BXP US 10:00 Q2 2017 Earnings Call Q2 17
Entergy Corp ETR US 10:00 Q2 2017 Earnings Call Q2 17
Garmin Ltd GRMN US 10:30 Q2 2017 Earnings Call Q2 17
Devon Energy Corp DVN US 11:00 Q2 2017 Earnings Call Q2 17
Newfield Exploration Co NFX US 11:00 Q2 2017 Earnings Call Q2 17
Extra Space Storage Inc EXR US 11:00 Q2 2017 Earnings Call Q2 17
Vulcan Materials Co VMC US 11:00 Q2 2017 Earnings Call Q2 17
Molson Coors Brewing Co TAP US 11:00 Q2 2017 Earnings Call Q2 17
ONEOK Inc OKE US 11:00 Q2 2017 Earnings Call Q2 17
AutoNation Inc AN US 11:00 Q2 2017 Earnings Call Q2 17
Exelon Corp EXC US 11:00 Q2 2017 Earnings Call Q2 17
Southern Co/The SO US 13:00 Q2 2017 Earnings Call Q2 17
Lincoln National Corp LNC US Aft-mkt Q2 2017 Earnings Release Q2 17 1.745
CenturyLink Inc CTL US Aft-mkt Q2 2017 Earnings Release Q2 17 0.489
Occidental Petroleum Corp OXY US Aft-mkt Q2 2017 Earnings Release Q2 17 0.089
Prudential Financial Inc PRU US Aft-mkt Q2 2017 Earnings Release Q2 17 2.703
Concho Resources Inc CXO US Aft-mkt Q2 2017 Earnings Release Q2 17 0.428
Macerich Co/The MAC US Aft-mkt Q2 2017 Earnings Release Q2 17 0.937
CF Industries Holdings Inc CF US Aft-mkt Q2 2017 Earnings Release Q2 17 (0.015)
Williams Cos Inc/The WMB US Aft-mkt Q2 2017 Earnings Release Q2 17 0.202
MetLife Inc MET US Aft-mkt Q2 2017 Earnings Release Q2 17 1.281
AvalonBay Communities Inc AVB US Aft-mkt Q2 2017 Earnings Release Q2 17 2.099
ANSYS Inc ANSS US Aft-mkt Q2 2017 Earnings Release Q2 17 0.914
Fortune Brands Home & Security Inc FBHS US Aft-mkt Q2 2017 Earnings Release Q2 17 0.872
Qorvo Inc QRVO US 16:00 Q1 2018 Earnings Release Q1 18 0.805
CA Inc CA US Aft-mkt Q1 2018 Earnings Release Q1 18 0.553
Citrix Systems Inc CTXS US Aft-mkt Q2 2017 Earnings Release Q2 17 0.996
Equinix Inc EQIX US Aft-mkt Q2 2017 Earnings Release Q2 17 3.305
American Water Works Co Inc AWK US Aft-mkt Q2 2017 Earnings Release Q2 17 0.792
Hologic Inc HOLX US Aft-mkt Q3 2017 Earnings Release Q3 17 0.494
Cincinnati Financial Corp CINF US Aft-mkt Q2 2017 Earnings Release Q2 17 0.495
Federal Realty Investment Trust FRT US Aft-mkt Q2 2017 Earnings Release Q2 17 1.458
Marathon Oil Corp MRO US Aft-mkt Q2 2017 Earnings Release Q2 17 (0.149)
Symantec Corp SYMC US 16:05 Q1 2018 Earnings Release Q1 18 0.307
American International Group Inc AIG US 16:15 Q2 2017 Earnings Release Q2 17 1.196
CenturyLink Inc CTL US 16:30 Q2 2017 Earnings Call Q2 17
Fortune Brands Home & Security Inc FBHS US 16:30 Q2 2017 Earnings Call Q2 17
Hologic Inc HOLX US 16:30 Q3 2017 Earnings Call Q3 17
Citrix Systems Inc CTXS US 16:45 Q2 2017 Earnings Call Q2 17
Qorvo Inc QRVO US 17:00 Q1 2018 Earnings Call Q1 18
Symantec Corp SYMC US 17:00 Q1 2018 Earnings Call Q1 18
CA Inc CA US 17:00 Q1 2018 Earnings Call Q1 18
Level 3 Communications Inc LVLT US 17:30 Q2 2017 Earnings Call Q2 17
Equinix Inc EQIX US 17:30 Q2 2017 Earnings Call Q2 17