US : Pre Market News – 20 Sep 2016

Dec E-mini S&Ps (ESZ16 +0.36%) are up +0.33% and European stocks are up +0.34% ahead of the 2-day FOMC meeting that begins later this morning and the 2-day BOJ meeting that begins later today. Increased M&A activity is giving U.S. equities a boost with Community Health Systems up over 8% in pre-market trading after Reuters reported that Apollo Global Management is interested in the company’s assets. Weakness in energy producing stocks is limiting the upside in stock index futures with the price of crude oil (CLX16 -1.12%) down -0.62% on concern the global oil glut may persist after Nigeria’s Minister of State for Petroleum said that Nigeria’s crude output reached 1.75 million bpd and will keep rising after a cease-fire between government troops and rebels was implemented. Asian stocks settled mixed: Japan -0.16%, Hong Kong -0.08%, China -0.10%, Taiwan +0.10%, Australia +0.17%, Singapore +0.09%, South Korea +0.46%, India -0.39%. Japanese stocks closed lower as USD/JPY weakened, which reduces the earnings prospects for exporting companies.

The dollar index (DXY00 +0.07%) is up +0.09%. EUR/USD (^EURUSD) is up +0.04%. USD/JPY (^USDJPY) is down -0.01%.

Dec T-note prices (ZNZ16 +0.04%) are up +1.5 ticks.

The ECB wrote in an economic bulletin today that weak trade will be the “new normal” in the post crisis world. While global trade grew on average twice as fast as global output prior to the financial crisis, the ECB said the ratio of imports to world GDP has largely stagnated over the last 5 years and will probably remain at current levels.

Key U.S. news today includes: (1) Aug housing starts (expected -1.7% to 1.190 million, Jul +2.1% to 1.211 million) and Aug building permits (expected +1.8% to 1.165 million, Jul -0.8% to 1.144 million), (2) FOMC begins 2-day policy meeting.

Russell 1000 companies that report earnings today: Lennar Corp (consensus $ 0.90), Adobe Systems (0.72), FedEx (2.80), Copart (0.55).

U.S. IPO’s scheduled to price today: Novan (NOVN), Trade Desk (TTD).

Equity conferences this week include: BMO Capital Markets North American Real Estate Conference on Mon-Tue, Deutsche Bank Energy Summit on Tue, J.P. Morgan U.S. All Stars Conference on Tue, Scotiabank Fertilizer and Chemicals Conference on Tue, Finance Montreal FinTech Forum on Tue-Wed, Johnson Rice Energy Conference on Tue-Wed, Goldman Sachs Communicopia Conference on Tue-Thu, Finance Shared Services & GBS Exchange Conference on Wed.

Wells Fargo (WFC +1.28%) was upgraded to ‘Overweight’ from ‘Equal Weight’ at Morgan Stanley with a price target of $ 53.

Community Health Systems (CYH -9.76%) is up over 8% in pre-market trading after Reuters reported that Apollo Global Management is interested in the company’s assets.

Novartis (NVS +0.76%) was rated a new ‘Buy’ at Chardan Capital Markets with a 12-month price target of $ 95.

Cirrus Logic (CRUS +0.91%) gained 1% in after-hours trading after it was announced that it will replace Fairchild in the S&P Midcap 400 as of the close of trading on Wednesday, Sep 21.

Ultimate Software Group (ULTI -0.08%) was rated a new ‘Overweight’ at Pacific Crest with a 12-month target price of $ 245.

HNI Corp. (HNI +2.30%) dropped nearly 8% in after-hours trading after it lowered guidance on Q3 sales to down -4% to -7% from a prior view of flat to up +3%, and then lowered its full-year adjusted EPS view to $ 2.50-$ 2.70 from a prior view of $ 2.80-$ 2.95.

Ascena Retail Group (ASNA +1.88%) plunged over 20% in after-hours trading after it said it sees full-year adjusted EPS of 60 cents-65 cents, weaker than consensus of 82 cents.

Chesapeake Energy (CHK -7.35%) slid over 3% in after-hours trading after Carl Icahn cut his stake in the company to 4.55% from a 9.4% stake.

Hortonworks (HDP +0.26%) jumped over 5% in after-hours trading after the company announced a collaboration with IBM and provide IBM customers with open source data disribition for big data processing.

Genpact Ltd (G +1.59%) gained 1% in after-hours trading after the company expanded its stock buyback program by $ 250 million.

8Point3 Energy Partners LP (CAFD +1.43%) jumped over 5% in after-hours trading after it boosted its quarterly dividend to $ 0.2406 a share from $ 0.2325 a share.

TherapeuticsMD (TXMD -1.19%) rose nearly 5% in after-hours trading after the U.S. FDA said it will review the company’s filing for its drug Yuvvexy to treat vulvar vaginal atrophy in postmenopausal women.

SeaWorld Entertainment (SEAS +0.55%) tumbled over 6% in pre-market trading after it cut its dividend to 10 cents from 21 cents and said it plan to suspend its dividend after the current declaration.

Oclaro (OCLR +2.36%) dropped nearly 5% in after-hours trading after it filed to sell 13 million shares of common stock.

Dec E-mini S&Ps (ESZ16 +0.36%) this morning are up +7.00 points (+0.33%). Monday’s closes: S&P 500 unch, Dow Jones -0.02%, Nasdaq -0.46%. The S&P 500 on Monday closed unchanged. Stocks were boosted by short-covering ahead of the Tue/Wed FOMC meeting on expectations for the Fed to refrain from raising interest rates. There was also a rally in homebuilder stocks after the +6 point increase in the U.S. Sep NAHB housing market index to 65, stronger than expectations of unch at 60 and the highest in 11 months. Stocks gave up their gains after Apple retreated from a 9-1/4 month high and closed down -1.17%, which dragged technology stocks lower.

Dec 10-year T-notes (ZNZ16 +0.04%) this morning are up +1.5 ticks. Monday’s closes: TYZ6 +0.50, FVZ6 +0.50. Dec T-notes on Monday closed slightly higher on short-covering and position squaring on expectations for the Fed to refrain from raising interest rates at this week’s FOMC meeting. T-notes were undercut by the unexpected gain in the Sep NAHB housing market index to an 11-month high.

The dollar index (DXY00 +0.07%) this morning is up +0.091 (+0.09%). EUR/USD (^EURUSD) is up +0.0005 (+0.04%). USD/JPY (^USDJPY) is down -0.01 (-0.01%). Monday’s closes: Dollar index -0.267 (-0.28%), EUR/USD +0.0020 (+0.18%), USD/JPY -0.36 (-0.35%). The dollar index on Monday closed lower on expectations that the FOMC at its Tue/Wed meeting will refrain from a rate hike. There was also strength in EUR/USD after an MNI report cited an unnamed senior ECB official who said the ECB will probably stay on hold the rest of this year as it waits for previous policy measures to take full effect.

Nov crude oil (CLX16 -1.12%) this morning is down -27 cents (-0.62%) and Nov gasoline (RBX16 -1.51%) is down 09,0164 (-1.21%). Monday’s closes: Closes: CLX6 +0.24 (+0.55%), RBX6 -0.0305 (-2.20%). Nov crude oil and gasoline on Monday settled mixed. Crude oil prices were boosted by a weaker dollar and fighting between rebels and Libya’s military that has delayed a restart of Libyan crude exports. Crude oil prices were also boosted by OPEC Secretary General Mohammed Barkindo’s comment that the cartel may convene an extraordinary meeting if the group’s energy ministers reach a consensus at an informal meeting next week in Algiers. Crude oil prices were undercut by expectations that Wednesday’s weekly EIA data will show U.S. crude inventories rose +3.5 million bbl in the past week.