Live Index – Mon, 21 Mar 2016 Premarket

Jun E-mini S&Ps (ESM16 +0.06%) are up +0.11% at a 2-1/2 month high and received a boost on increased M&A activity after Sherwin-Williams agreed to buy Valspar Corp. for about $ 9.3 billion. Valspar surged 31% in pre-market trading and Sherwin-Williams is up over 2%. European stocks are up +0.38% on increased M&A prospects as well after people familiar with the matter said that Monsanto has approached BASF SE and Bayer AG about possible merger prospects. Asian stocks settled mixed: Japan closed for holiday, Hong Kong +0.06%, China +2.15%, Taiwan +0.02%, Australia -0.32%, Singapore -0.90%, South Korea -0.14%, India +1.33%. China’s Shanghai Composite climbed to a 2-1/4 month high as brokerage stocks rallied after the government loosened controls on margin lending. China Securities Finance Corp., the state-backed agency that provides funding to brokerages for margin trading, said it will restart offering loans to securities firms for periods ranging from 7 days to 182 days.

The dollar index (DXY00 +0.02%) is down -0.01%. EUR/USD (^EURUSD) is up +0.10%. USD/JPY (^USDJPY) is down -0.08%.

Jun T-note prices (ZNM16 -0.05%) are down -1.5 ticks.

Richmond Fed President Lacker said that recent data suggests the upside risks to inflation have increased, even if the increase has been small, and that he is “reasonably confident that, barring subsequent shocks, inflation will move back to the FOMC’s 2% objective over the medium term.”

Key U.S. news today includes: (1) Richmond Fed President Jeffrey Lacker’s speech about the outlook for inflation and inflation expectations at an event hosted by the Banque of France, (2) Feb Chicago Fed national activity index (expected -0.03 to 0.25, Jan +0.62 to 0.28), (3) Feb existing home sales (expected -2.9% to 5.31 million, Jan +0.4% to 5.47 million), (4) Atlanta Fed President Dennis Lockhart’s speech on the U.S. economy to the Rotary Club of Savannah.

There is 1 of the Russell 1000 companies that reports earnings today: IHS (consensus $ 1.35).

U.S. IPO’s scheduled to price today: none.

Equity conferences this week include: Asia Pacific Rail 2016 on Mon, BioPharma Asia Convention 2016 on Mon, Capital Link International Shipping & Offshore Forum on Mon, Consumer Analyst Group of Europe Conference on Mon-Tue, Scotia Howard Weil Energy Conference on Mon-Tue, Wells Fargo Asset Managers, Brokers & Exchanges Forum on Tue, Gabelli Specialty Chemicals Conference on Tue, Telsey Advisory Group (TAG) Spring Consumer Conference on Tue, Bank of America Merrill Lynch New York Auto Summit on Wed, BB&T Capital Markets Commercial & Industrial Investors Conference on Wed-Thu.

Valspar (VAL -1.02%) surged over 30% in pre-market trading after the company was acquired by Sherwin-Williams for $ 9.3 billion. Sherwin-Williams (SHW +0.56%) is up over 2% on the news.

Tesla (TSLA +2.81%) was upgraded to ‘Buy’ from ‘Hold ad Argus Research with a price target of $ 333.

Starwood Hotels & Resorts Worldwide (HOT +5.47%) said it has accepted an improved bid from Marriott International (MAR +1.89%) to purchase the company for $ 13.6 billion.

Knight Transportation (KNX +4.15%) was downgraded to ‘Market perform’ from ‘Outperform at Cowen.

Valeant Pharmaceuticals (VRX -9.13%) was downgraded to ‘Underperform’ from ‘Neutral’ at Mizuho Securities.

Nordstrom (JWN +0.52%) was downgraded to ‘Neutral’ from ‘Overweight’ at Piper Jaffray.

Dover (DOV +0.66%) was downgraded to ‘Neutral’ from ‘Buy’ at SunTrust.

Fiserv (FISV +0.94%) was downgraded to ‘Market Perform’ from ‘Outperform’ at Oppenheimer.

Amazon.com (AMZN -1.32%) reported a 9.99% passive stake in Air Transport Services Group (ATSG +3.04%) , making it the second-largest shareholder of the company.

Chesapeake Energy (CHK +2.51%) reported that as of March 18 it has issued or agreed to issue 17.26 million shares, or 2.6% of shares outstanding, in exchange for $ 105 million in contingent convertible senior notes.

Flex Pharma (FLKS +1.38%) filed a $ 125 million mixed securities shelf.

Jun E-mini S&Ps (ESM16 +0.06%) this morning are up +2.25 points (+0.11%) at a fresh 2-1/2 month high. Friday’s closes: S&P 500 +0.44%, Dow Jones +0.69%, Nasdaq +0.24%. The S&P 500 on Friday climbed to a 2-1/2 month high and closed higher on carry-over support from Friday’s +1.73% rally in China’s Shanghai Composite and on the rally in crude oil to a 3-1/2 month high, which buoyed energy producer stocks. Stocks were undercut by the unexpected -1.7 point decline in the U.S. Mar University of Michigan consumer sentiment index to a 5-month low of 90.0, weaker than expectations of +0.5 to 92.2.

Jun 10-year T-notes (ZNM16 -0.05%) this morning are down -1.5 ticks. Friday’s closes: TYM6 +9.50, FVM6 +7.50. Jun T-notes on Friday closed higher on the unexpected drop in the U.S. Mar University of Michigan consumer sentiment to a 5-month low and on carryover support from a rally in global government bond markets after the 10-year German bund yield fell to a 1-week low of 0.198% and the 10-year Japanese government bond yield fell to a record low of negative -0.135%.

The dollar index (DXY00 +0.02%) this morning is down -0.006 (-0.01%). EUR/USD (^EURUSD) is up +0.0011 (+0.10%). USD/JPY (^USDJPY) is down -0.09 (-0.08%). Friday’s closes: Dollar Index +0.326 (+0.34%), EUR/USD -0.0048 (-0.42%), USD/JPY +0.16 (+0.14%). The dollar index on Friday settled higher on weakness in EUR/USD after ECB Executive Board member Praet said that there was still scope for the ECB to lower interest rates if the Eurozone economy falters. In addition, USD/JPY saw a little boost as a rally in stocks reduced the safe-haven demand for the yen.

Apr WTI crude (CLJ16 -1.39%) this morning is down -30 cents (-0.76%) and Apr gasoline (RBJ16 +0.46%) is up +0.0070 (+0.49%). Friday’s closes: CLJ6 -0.76 (-1.89%), RBJ6 -0.0110 (-0.76%). Apr crude and gasoline on Friday closed lower. Apr crude fell back from a 3-1/2 month high on a stronger dollar and on an increase in U.S. active oil rigs for the first time this year after data from Baker Hughes showed active U.S. oil rigs rose +1 to 387 in the week ended Mar 18, the first increase in the last 13 weeks.