Live Index – Mon, 06 Oct 2014 Premarket
December E-mini S&Ps (ESZ14 +0.34%) this morning are up +0.33% and European stocks are up +0.59% on positive carry-over from Friday’s U.S. Sep payrolls report that showed the U.S. unemployment rate unexpectedly fell to a 6-year low. Limiting strength in European stocks was a larger-than-expected decline in German Aug factory orders that fell by the most in 5-1/2 years. Asian stocks closed mixed: Japan +1.16%, Hong Kong +1.09%, China, Singapore and India closed for holidays, Taiwan -0.12%, Australia -0.48%, South Korea -0.35%. Japanese stocks rallied sharply after Friday’s strong U.S. payrolls report bolstered the outlook for Asian exporters, and Hong Kong’s Hang Seng Stock Index rose over 1% as pro-democracy demonstrations dwindled after the start of talks with the government, as some roads and schools reopened and tensions eased that police were poised to clear protesters. Commodity prices are mostly higher. Nov crude oil (CLX14 +0.62%) is up +0.57%. Nov gasoline (RBX14 +0.99%) is up +0.93%. Dec gold (GCZ14 +0.17%) recovered from a 9-month low and is up +0.11%. Dec copper (HGZ14 +0.90%) is up +0.95%. Agriculture prices are higher. The dollar index (DXY00 -0.39%) is down -0.34% after a Goldman Sachs report said that labor-market slack and weak wage growth will keep the Fed from raising interest rates until Q3 of next year. EUR/USD (^EURUSD) is up +0.30%. USD/JPY (^USDJPY) is down -0.35%. Dec T-note prices (ZNZ14 +0.12%) are up +3 ticks.
German Aug factory orders plunged -5.7% m/m, over twice expectations of -2.5% m/m and the largest monthly decline in 5-1/2 years. On an annual basis, Aug factory orders unexpectedly fell -1.3% y/y, weaker than expectations of +2.6% y/y.
The Eurozone Oct Sentix investor confidence fell -3.9 to -13.7, a bigger decline than expectations of -1.2 to -11.0 and the lowest in 17 months.
There are no U.S. economic reports today. There are no earnings reports today from the Russell 1000 companies. Equity conferences this week include: Predictive Analytics World Conference – Boston on Mon-Tue, RBC International Oil & Gas Conference on Tue, CEATEC Japan 2014 on Tue, Economic Club of Canada: Reasserting Canada’s Competitiveness in the Digital Ec on Tue, and 2014 IIF Annual Membership Meeting on Fri.
Hewlett-Packard (HPQ +2.00%) jumped over 7% in pre-market trading after the company announced that it will split into two separate companies, a personal-computer and printer business, and corporate hardware and services operations.
Burger King (BKW +1.48%) was upgraded to ‘Overweight’ from ‘Equal Weight’ at Morgan Stanley.
McDonald’s (MCD +0.79%) was downgraded to ‘Equal Weight’ from ‘Overweight’ at Morgan Stanley.
L Brands (LB +1.04%) was upgraded to ‘Outperform’ from ‘Market Perform’ at BMO Capital.
Conn’s (CONN +5.75%) announced that its Board of Directors authorized management to explore a full range of strategic alternatives for the company to enhance value for stockholders, including, but not limited to, a sale of the company.
Colgate-Palmolive (CL +1.05%) was downgraded to ‘Equal Weight’ from ‘Overweight’ at Barclays.
ConocoPhillips (COP +0.11%) was upgraded to ‘Neutral’ from ‘Sell’ at UBS.
PetSmart (PETM +0.18%) was downgraded to ‘Equal Weight’ from ‘Overweight’ at Barclays.
Intuitive Surgical (ISRG +1.19%) was upgraded to ‘Buy’ from ‘Neutral’ at Goldman Sachs who also raised their price target on the stock to $ 584 from $ 466.
Laboratory Corporation of America reported a 17.7% stake in LipoScience (LPDX unch) .
EJF Capital reported a 5.9% passive stake in Sun Bancorp (SNBC +0.66%) .
Cal-Maine Foods (CALM +4.08%) announced a 2-for-1 stock split effective Oct 31 for shareholders of record at the close on Oct 17.
Dec E-mini S&Ps (ESZ14 +0.34%) this morning are up +6.50 points (+0.33%). The S&P 500 index on Friday closed higher: S&P 500 +1.12%, Dow Jones +1.24%, Nasdaq +1.04%. Bullish factors included (1) the +248,000 increase in Sep non-farm payrolls, more than expectations of +215,000, while Aug was revised upward to an increase of +180,000 from the originally reported +142,000, (2) the unexpected -0.2 drop in the Sep unemployment rate to 5.9%, better than expectations of no change at 6.1% and the lowest in 6 years, and (3) the -1.0 drop in the Sep ISM non-manufacturing index to 58.5, a smaller decline than expectations of -1.1 to 58.5.
Dec 10-year T-notes (ZNZ14 +0.12%) this morning are up +3 ticks. Dec 10-year T-note futures prices on Friday closed lower. Bearish factors included (1) the larger-than-expected increase in Sep non-farm payrolls and the unexpected decline in the Sep unemployment rate to a 6-year low, and (2) reduced safe-haven demand for T-notes after stocks rallied. Losses in T-notes were contained on a lack of wage pressures in the U.S. economy after Sep avg hourly earnings rose less than expected. Closes: TYZ4 -5.50, FVZ4 -6.00.
The dollar index (DXY00 -0.39%) this morning is down -0.291 (-0.34%). EUR/USD (^EURUSD) is up +0.0037 (+0.30%) and USD/JPY (^USDJPY) is down -0.38 (-0.35%). The dollar index on Friday climbed to a new 4-1/4 year high and closed higher. Bullish factors included (1) the stronger-than-expected U.S. Sep payrolls report, which bolsters the case for the Fed to raise interest rates next year, and (2) weakness in EUR/USD which fell to a 2-year low on European economic concerns after the Eurozone Sep Markit composite PMI was revised down to 52.0 from the previously reported 52.3, the slowest pace of expansion in 10 months. Closes: Dollar index +1.093 (+1.28%), EUR/USD -0.01589 (-1.25%), USD/JPY +1.31 (+1.21%).
Nov WTI crude oil (CLX14 +0.62%) this morning is up +51 cents (+0.57%) and Nov gasoline (RBX14 +0.99%) is up +0.0221 (+0.93%). Nov crude and Nov gasoline prices on Friday closed lower with Nov gasoline at a 3-3/4 year low: CLX4 -1.27 (-1.40%), RBXX4 -0.0304 (-1.26%). Bearish factors included (1) the rally in the dollar index to a 4-1/4 year high, and (2) concern that the action by Saudi Arabia to cut in its official selling price to a 6-year low may start a price war within OPEC as Saudi Arabia tries to protect its share of OPEC output.
|US||1100 ET||USDA weekly grain export inspections.|
|1600 ET||USDA weekly crop progress.|
|2030 ET||Kansas City Fed President Esther George speaks on the U.S. economy to business and community leaders in Albuquerque, New Mexico.|
|GER||0200 ET||German Aug factory orders expected -2.5% m/m and +2.6% y/y, Jul +4.6% m/m and +4.9% y/y.|
|EUR||0430 ET||Eurozone Oct Sentix investor confidence expected -1.2 to -11.0, Sep -9.8.|
|Company Name||Ticker||Time||Event Description||Period||Estimate|
|Protective Life Corp||PL US||11:00||Special Meeting – M&A Vote|
|Adobe Systems Inc||ADBE US||18:00||Financial Analyst Briefing||Y 2014|
|Pinnacle West Capital Corp||PNW US||Investor Meeting – Day 1||Y 2014|