Live Index – Mon, 04 Jan 2016 Premarket
March E-mini S&Ps (ESH16 -1.83%) are down -1.72% and European stocks are down -3.20%, both at 2-week lows, after data that showed weaker-than-expected manufacturing activity in China fueled a 7% plunge in Chinese stocks. Geopolitical concerns also weighed on stocks and sparked a +0.49% rally in crude oil to a 2-week high after Saudi Arabia cut ties with Iran after protesters set fire to its embassy in Iran following the execution of a jailed Shiite cleric in Saudi Arabia. Asian stocks settled sharply lower: Japan -3.06%, Hong Kong -2.68%, China -6.86%, Taiwan -2.68%, Australia -0.48%, Singapore -1.62%, South Korea -2.39%, India -2.05%. China’s Shanghai Composite and Japan’s Nikkei Stock Index both slumped to 2-1/4 month lows with trading in Chinese stocks halted after the Shanghai Composite plunged 7%, which initiated circuit-breaker rules that closed the market for the rest of the day.
The dollar index (DXY00 -0.42%) is down -0.42%. EUR/USD (^EURUSD) is up +0.57%. USD/JPY (^USDJPY) is down -1.42% to a 2-1/2 month low as the sell-off in global stocks boosts the safe-haven demand for the yen.
Mar T-note prices (ZNH16 +0.41%) are up +15.5 ticks.
The China Dec manufacturing PMI rose +0.1 to 49.7, weaker than expectations of +0.2 to 49.8. The Dec non-manufacturing PMI rose +0.8 to 54.4, the fastest pace of expansion in 16 months.
The Eurozone Dec Markit manufacturing PMI was revised upward to 53.2 from the previously reported 53.1, the fastest pace of expansion in 1-1/2 years.
Key U.S. news today includes: (1) final-Dec Markit manufacturing PMI (preliminary-Dec -1.5 to 51.3), (2) Nov construction spending (expected +0.6% m/m, Oct +1.0% m/m), (3) Dec ISM manufacturing index (expected +0.4 to 49.0, Nov -1.5 to 48.6), and (4) San Francisco Fed President John Williams’ appearance on a panel at the American Economic Association meeting on “The Implementation of Macroprudential Policies by Central Banks.”
None of Russell 3000 companies report earnings today.
U.S. IPO’s scheduled to price today: none.
Equity conferences this week: J.P. Morgan Tech Forum on Tue, Goldman Sachs Health Care CEO Unscripted Conference on Tue, Goldman Sachs Global Energy Conference on Wed, and Citi Global Internet, Media & Telecommunications Conference on Wed-Thu.
Chesapeake Energy (CHK +2.27%) and Ultra Petroleum (UPL +2.46%) were both downgraded to ‘Underperform’ from “Market Perform’ at Raymond James.
GameStop (GME -1.54%) was downgraded to ‘Neutral’ from ‘Buy’ at Sterne Agee CRT.
Check Point Software Technologies Ltd. (CHKP -1.19%) was downgraded to ‘Market Perform’ from ‘Outperform’ at Wells Fargo Securities.
Intuitive Surgical (ISRG -1.15%) was raised to ‘Overweight’ at Morgan Stanley.
Shire Plc (SHPG -1.93%) fell nearly 3% in pre-market trading after it said it is in advanced talks to acquire Baxalta Inc for about $ 32 billion in cash and stock.
Tesla Motors (TSLA +0.81%) said it delivered 50,580 vehicles for the year, within the range it projected in November of 50,000 to 52,000 vehicles.
Public Storage (PSA -1.10%) was downgraded to ‘Neutral’ from ‘Buy’ at Goldman Sachs.
Nike (NKE -1.19%) Chairman Philip Knight resigned from one of his swoosh Class X Board seats and appointed Travis Knight to fill the vacancy.
Nord Anglia Education (NORD +1.10%) revised its Q4 adjusted EPS to a loss of -25 cents, a wider loss than the -22 cents that was reported on Nov 16, citing an “onerous lease provision” on a Chicago school.
Pershing Square reported that it reduced its stake in Valeant Pharmaceuticals (VRX -0.66%) to 8.5% from 9.9%.
CorEnegy Infrastructure (CORR -1.20%) announced a $ 10 million share repurchase program and an extension of its Pinedale Credit Facility through March of 2016.
Mar E-mini S&Ps (ESH16 -1.83%) this morning are down -35.00 points (-1.72%) to a 2-week low. Thursday’s closes: S&P 500 -0.94%, Dow Jones -1.02%, Nasdaq -1.26%. The S&P 500 on Thursday dropped to a 1-week low after U.S. weekly initial unemployment claims rose +20,000 to a 5-1/2 month high of 287,000 (versus expectations of +3,000 to 270,000), and after the Dec Chicago PMI unexpectedly fell -5.8 to 42.9, weaker than expectations of +1.3 to 50.0 and the steepest pace of contraction in 6-1/3 yrs. Also pressuring stocks was negative carryover from a -0.94% drop in China’s Shanghai Composite.
Mar 10-year T-notes (ZNH16 +0.41%) this morning are up +15.5 ticks. Thursday’s closes: TYH6 +9.50, FVH6 +4.50. Mar T-notes on Thursday closed higher after U.S. weekly jobless claims rose to a 5-1/2 month high and after the Dec Chicago PMI contracted at its steepest pace in 6-1/3 years. In addition, a sell-off in the S&P 500 to a 1-week low boosted the safe-haven demand for T-notes.
The dollar index (DXY00 -0.42%) this morning is down -0.417 (-0.42%). EUR/USD (^EURUSD) is up +0.0062 (+0.57%). USD/JPY (^USDJPY) is down -1.71 (-1.42%) at a 2-1/2 month low. Thursday’s closes: Dollar Index +0.365 (+0.37%), EUR/USD -0.0071 (-0.65%), USD/JPY -0.30 (-0.25%). The dollar index climbed to a 1-1/2 week high Thursday on weakness in the Chinese yuan which fell to a 4-1/2 year low against the dollar, and on divergent central bank policies as the Fed has begun raising interest rates while the BOJ, ECB and PBOC are expected to maintain or even expand their stimulus measures.
Feb crude oil (CLG16 +0.84%) this morning is up +18 cents (+0.49%) at a 2-week high and Feb gasoline (RBG16 +1.87%) is up +0.259 (+2.04%). Thursday’s closes: CLG6 +0.44 (+1.20%), RBG6 +0.0247 (+1.99%). Feb crude recovered from a 1-week low Thursday and closed higher on forecasts for more seasonal winter weather for the central and eastern U.S. over the next 5 days, which should boost demand for heating fuels. Fund short covering ahead of the long holiday weekend also gave crude prices a lift. Gains in energy prices were limited as the dollar index rallied up to a 1-1/2 week high.
|US||0945 ET||Final-Dec Markit manufacturing PMI expected -0.3 to 51.0, preliminary-Dec -1.5 to 51.3.|
|1000 ET||Nov construction spending expected +0.7% m/m, Oct +1.0% m/m.|
|1000 ET||Dec ISM manufacturing index expected +0.4 to 49.0, Nov -1.5 to 48.6. Dec ISM new orders, Nov -4.0 to 48.9. Dec ISM employment, Nov +3.7 to 51.3. Dec ISM prices paid expected +0.5 to 36.0, Nov -3.5 to 35.5.|
|1100 ET||USDA weekly grain export inspections.|
|1730 ET||San Francisco Fed President John Williams speaks on a panel at the American Economic Association meeting on The Implementation of Macroprudential Policies by Central Banks.|
|GER||0355 ET||Revised German Dec Markit/BME manufacturing PMI, preliminary +0.1 to 53.0.|
|0800 ET||German Dec CPI (EU harmonized) expected +0.2% m/m and +0.4% y/y, Nov +0.1% m/m and +0.3% y/y.|
|EUR||0400 ET||Revised Eurozone Dec Markit manufacturing PMI, preliminary +0.3 to 53.1.|
|UK||0430 ET||UK Dec Markit manufacturing PMI expected +0.1 to 52.8, Nov 52.7.|
|0430 ET||UK Nov net consumer credit expected +1.3 billion pounds, Oct +1.2 billion pounds.|
|0430 ET||UK Nov mortgage approvals expected 69,800, Oct 69,600.|
|0430 ET||UK Nov M3 money supply, Oct +0.6% m/m and +0.2% y/y.|