Live Index – Tue, 05 Jul 2016 Premarket
Sep E-mini S&Ps (ESU16 -0.66%) are down -0.44% and European stocks are down -1.16% as a decline in commodity prices drags down mining stocks and energy producers. Also, fallout from the Brexit vote is beginning to emerge as commercial-property companies slumped and the British pound tumbled -0.95% to a fresh 30-3/4 year low after Standard Life Investments suspended trading in its 2.9 billion pound ($ 3.9 billion) UK Real Estate fund as withdrawals surged. In addition, Italian bank stocks sold-off, with Banca Monte dei Paschi di Siena SpA down over 7% to a record low, after a person familiar with the matter said Italy is considering injecting fresh capital into Italy’s third-biggest bank ahead of stress test results. Asian stocks settled mostly lower: Japan -0.67%, Hong Kong -1.46%, China +0.60%, Taiwan 0.51%, Australia -1.02%, Singapore -0.21%, South Korea -0.29%, India -0.415. China’s Shanghai Composite was a bright spot as it rallied to a 2-1/4 month high and the Chinese yuan fell to a 5-1/2 year low against the dollar on speculation the PBOC will take steps to boost economic growth after a front-page commentary in the state-run China Securities Journal said the PBOC is likely to fine-tune monetary policy in the second half of this year with targeted reserve-requirement ratio cuts or possibly across-the-board cuts.
The dollar index (DXY00 -0.04%) is down -0.11% at a 1-week low. EUR/USD (^EURUSD) is down -0.01%. USD/JPY (^USDJPY) is down -0.76%.
Sep T-note prices (ZNU16 +0.49%) are up +21 ticks.
The BOE cut its capital requirements for UK banks and pledged to implement other measures to shore up financial stability in the wake of the Brexit vote. The BOE’s Financial Policy Committee lowered the countercyclical-capital buffer rate for UK exposures to zero from 0.5%, a move the BOE said would raise the capacity for lending to households and businesses by as much as 150 billion pounds.
Key U.S. news today includes: (1) Jun New York ISM (May 37.2), (2) May factory orders (expected -0.8%, Apr +1.9% and +0.5% ex transportation), (3) New York Fed President William Dudley (voter) participates in a roundtable discussion on local business conditions with members of the Greater Binghamton Chamber of Commerce, (4) USDA weekly grain export inspections, and (5) USDA Weekly Crop Progress.
Russell 1000 companies reporting earnings today: none.
U.S. IPO’s scheduled to price today: none.
Equity conferences this week include: none.
Tesla (TSLA +1.99%) dropped over 4% in pre-market trading after the company delivered 14,370 automobiles in Q2, below expectations of 17,000.
Illumina (ILMN +0.25%) was downgraded to ‘Underweight’ from ‘Equalweight’ at Morgan Stanley.
CenterPoint Energy (CNP +0.21%) was downgraded to ‘Hold’ from ‘Buy’ at Tudor Pickering & Co.
Nordstrom (JWN +0.47%) was upgraded to ‘Hold’ from ‘Sell’ at Miller Tabak & Co.
Netflix (NFLX +5.67%) was downgraded to ‘Hold’ from ‘Buy at Needham.
Cerner Corp. (CERN +0.53%) was downgraded to ‘Market Perform’ from ‘Outperform’ at Raymond James.
CyberArk Software Ltd. (CYBR -0.45%) was upgraded to ‘Overweight’ from ‘Equal-weight’ at Barclays with a target price of $ 60.
Esperion Therapeutics (ESPR +4.76%) was downgraded to ‘Hold’ from ‘Buy’ at Wallachbeth Capital with a 12-month price target of $ 35.
According to people familiar with the matter, Aetna (AET -1.78%) is preparing to sell assets worth several billion dollars as it seeks to silence regulatory concerns over its proposed $ 37 billion takeover of Humana.
Eiger BioPharmaceuticals (EIGR +0.45%) was rated a new ‘Outperform’ at Oppenheimer with an 18-month target price of $ 34.
September E-mini S&Ps (ESU16 -0.66%) this morning are down -9.25 points (-0.44%). Friday’s closes: S&P 500 +0.19%, Dow Jones +0.11%, Nasdaq +0.45%. The S&P 500 on Friday climbed to a 1-week high and settled higher on favorable interest rate developments as UK gilt yields and U.S. T-note yields fell to record lows on optimism that central banks will expand easing measures to mitigate the negative effects of the Brexit vote. Stocks were also boosted by the unexpected +1.9 point increase in the U.S. Jun ISM manufacturing PMI to 53.2, stronger than expectations of unch at 51.3 and the fastest pace of expansion in 16 months. Stocks were undercut by S&P’s cut in its U.S. 2016 GDP estimate to 2.0% from a previous estimate of 2.3%.
Sep 10-year T-note prices (ZNU16 +0.49%) this morning are up +21 ticks. Friday’s closes: TYU6 +3.00. FVU6 -0.75. Sep T-notes on Friday closed higher as the 10-year T-note yield fell to an all-time low of 1.377%. T-note prices were boosted by carryover support from a rally in UK gilts and Japanese 10-year bonds to all-time highs and speculation that foreign demand for U.S. government debt will increase as yields on 10-year U.S. Treasuries are still above zero while yields on German bunds and Japanese 10-year bonds are below zero. T-notes were undercut by news that the Jun ISM manufacturing index rose to a 16-month high.
The dollar index (DXY00 -0.04%) this morning is down -0.103 (-0.11%) at a 1-week low. EUR/USD (^EURUSD) is down -0.0001 (-0.01%). USD/JPY (^USDJPY) is down -0.78 (-0.76%). Friday’s closes: Dollar Index -0.507 (-0.53%), EUR/USD +0.0030 (+0.27%), USD/JPY -0.68 (-0.66%). The dollar index on Friday closed lower on S&P’s cut in its U.S. 2016 GDP estimate to 2.0% from a prior estimate of 2.3% and on strength in EUR/USD after the Eurozone Jun Markit manufacturing PMI was revised upward to a 6-month high of 52.8 from 52.6.
Aug WTI crude oil (CLQ16 -2.71%) this morning is down -$ 1.17 a barrel (-2.39%). Aug gasoline (RBQ16 -2.87%) is down -0.0395 (-2.61%). Friday’s closes: CLQ6 +0.66 (+1.37%), RBQ6 +0.0122 (+0.81%). Aug crude oil and gasoline on Friday closed higher on a weaker dollar and signs of economic strength after the Jun ISM manufacturing index expanded at its fastest pace in 16 months. Gasoline prices were boosted by expectations for strong gasoline demand as the AAA expects a record 43 million Americans to travel at least 50 miles by car this Fourth of July holiday, up +1.3% y/y.
|Tuesday, July 5, 2016|
|US||0945 ET||Jun New York ISM, May 37.2.|
|1000 ET||May factory orders expected -0.8%, Apr +1.9% and +0.5% ex transportation.|
|1100 ET||USDA weekly grain export inspections.|
|1430 ET||New York Fed President William Dudley (voter) participates in a roundtable discussion on local business conditions with members of the Greater Binghamton Chamber of Commerce.|
|1600 ET||USDA Weekly Crop Progress.|
|Wednesday, July 6, 2016|
|US||0700 ET||Weekly MBA mortgage applications, previous -2.6% with purchase sub-index -3.0% and refi sub-index -2.4%.|
|0830 ET||May trade balance expected -$ 40.0 billion, Apr -$ 37.4 billion.|
|0945 ET||Revised Jun Markit U.S. services PMI expected unchanged at 51.3, prelim-Jun unch at 51.3. Revised Jun Markit composite PMI, prelim-June +0.3 to 51.2.|
|1000 ET||Jun ISM non-manufacturing PMI expected +0.4 to 53.3, May -2.8 to 52.9.|
|1400 ET||Minutes of the Jun 14-15 FOMC meeting.|
|GER||0200 ET||German May factory orders expected +1.0% m/m and +0.9% y/y, Apr -2.0% m/m and -0.5% y/y.|
|0330 ET||German Jun Markit construction PMI, May 52.7.|
|UK||0400 ET||UK Jun new car registrations, May +2.5% y/y.|
|Alaska Air Group Inc||ALK US||June 2016 Sales and Revenue Release – Traffic Results||2016|
|Delta Air Lines Inc||DAL US||June 2016 Sales and Revenue Release – Traffic Results||2016|
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