Live Index – Tue, 16 Dec 2014 Premarket
March E-mini S&Ps (ESH15 -0.67%) this morning are down -0.18% and European stocks are down -0.35% at a 1-3/4 month low on Chinese economic concerns after a gauge of Chinese manufacturing activity contracted for the first time in 7 months. Losses were limited after Eurozone Dec manufacturing activity expanded at the fastest pace in 5 months and after a gauge of German investor expectations climbed at the fastest pace in 8 months. The Russian ruble plunged to a record low of 73.8238 per dollar even after the Bank of Russia unexpectedly raised its key interest rate to 17.0% from 10.5% as the plunge in oil prices exacerbates the collapse in the ruble. Asian stocks closed mostly lower: Japan -2.01%, Hong Kong -1.55%, China +2.68%, Taiwan -0.39%, Australia -0.65%, Singapore -2.40%, South Korea -0.75%, India -1.97%. Japan’s Nikkei Stock Index fell to a 1-month low after exporters sold-off as the yen rallied to a 4-week high against the dollar, which reduces the earnings prospects of exporters. Chinese stocks bucked the trend and closed higher on speculation economic weakness will prompt the government into expanding stimulus. Commodity prices are weaker. Jan crude oil (CLF15 -2.99%) is down -3.02% at a 5-1/2 year low as the rout in crude prices continues. Jan gasoline (RBF15 -2.91%) is down -3.10% % at a 5-1/2 year low. Feb gold (GCG15 +0.60%) is down -0.16%. Mar copper (HGH15 -0.47%) is down -0.56%. Agriculture prices are mostly lower. The dollar index (DXY00 -0.73%) is down -0.77% at a 2-week low. EUR/USD (^EURUSD) is up +0.90% at a 2-1/2 week high. USD/JPY (^USDJPY) is down -1.80% at a 4-week low. Mar T-note prices (ZNH15 +0.64%) are up +20.5 ticks at a 2-month high as the plunge in crude oil to a 5-1/2 year low undercuts inflation expectations along with carry-over support from a rally in German bunds as the 10-year bund yield sank to a record low of 0.566%.
The China Dec HSBC manufacturing PMI fell -0.5 to 49.5, a bigger decline than expectations of -0.2 to 49.8 and the slowest pace of expansion in 7 months.
The German Dec ZEW survey expectations of economic growth rose +23.4 to 34.9, a much larger increase than expectations of +8.5 to 20.0 and the highest in 8 months. The Dec ZEW survey current situation climbed +6.7 to 10.0, a larger increase than expectation sf +1.7 to 5.0
The Eurozone Dec Markit manufacturing PMI rose +0.7 to 50.8, more than expectations of +0.4 to 50.5 and the fastest pace of expansion in 5 months. The Eurozone Dec composite PMI rose +0.6 to 51.7, a larger increase than expectations of +0.4 to 51.5.
Bundesbank President Weidmann said there’s no need for the ECB to expand monetary stimulus into sovereign-bond buying even if slumping oil prices cause deflation, saying “such a development initially requires no monetary response, as long as no second round effects are to be seen.”
UK Nov CPI unexpectedly fell -0.3% m/m, weaker than expectations of unch m/m and matched July’s decline as the biggest monthly fall in 10 months. On an annual basis, Nov CPI rose +1.0% y/y, less than expectations of +1.2% y/y and the slowest pace of increase in 12-1/3 years. Nov core CPI rose +1.2%, less than expectations of +1.5% y/y and the smallest increase in 5-3/4 years.
The 2-day FOMC meeting begins today. The market is expecting today’s Nov housing starts report to show an increase of +3.1% to 1.040 million units, more than reversing October’s -2.8% m/m decline to 1.009 million units. There are 3 the Russell 1000 companies that report earnings today: Navistar (consensus $ 0.0), FactSet (1.32), Darden Restaurants (0.27). Equity conferences this week include: Macquarie Mobile Corporate Day on Tue, and Sanford C. Bernstein Technology Innovation Summit on Tue-Wed.
Microsoft (MSFT -0.60%) was downgraded to ‘Underperform’ from ‘Neutral’ at BofA/Merrill Lynch.
Hess Corp. (HES -1.62%) and EOG Resources (EOG -1.19%) were both downgraded to ‘Equal Weight’ from ‘Overweight’ at Morgan Stanley.
According to The New York Times, thw Royal Bank of Scotland (RBS -2.75%) and Lloyds (LYG -1.28%) failed a stress test performed by the Bank of England.
Dollar Tree (DLTR +0.68%) was downgraded to ‘Hold’ from ‘Buy’ at Deutsche Bank.
Macerich (MAC -0.37%) was downgraded to ‘Neutral’ from ‘Buy’ at Citigroup.
Autodesk (ADSK -1.14%) was downgraded to ‘Underperform’ from ‘Neutral’ at BofA/Merrill Lynch.
Bloomberg reported that Olam (OLMIY -1.98%) will acquire Archer Daniel’s (ADM -0.04%) cocoa business for $ 1.3 billion.
Boeing (BA +1.08%) climbed 2.7% in pre-market trading after it raised its dividend 25% and authorized a $ 12 billion share repurchase plan.
Goldman Sachs (GS -1.74%) was initiated with a ‘Buy’ at Guggenheim with a price target of $ 215.
Bank of America (BAC -1.63%) was initiated with a ‘Buy’ at Guggenheim with a price target of $ 20.
VeriFone (PAY +0.15%) reported Q4 EPS of 44 cents, higher than consensus of 41 cents.
Mar E-mini S&Ps (ESH15 -0.67%) this morning are down -3.50 points (-0.18%). The S&P 500 index on Monday slipped to a 1-1/2 month low and closed lower: S&P 500 -0.63%, Dow Jones -0.58%, Nasdaq -1.00%. Bearish factors included (1) weakness in energy producers after crude oil slumped to a 5-1/2 year low, and (2) the unexpected -13.24 point drop in the Dec Empire manufacturing index to -3.58, weaker than expectations of +2.24 to 12.40 and the slowest pace of expansion in 23 months. A positive for stocks was the strong +1.3% increase in U.S. Nov industrial production, the largest increase in 4-1/2 years.
Mar 10-year T-notes (ZNH15 +0.64%) this morning are up +20.5 ticks at a fresh 2-month high. Mar 10-year T-note futures prices on Monday retreated from a 2-month high and closed lower: TYH5 -9.50, FVH5 -8.00. Bearish factors included (1) the stronger-than-expected U.S. Nov industrial production, and (2) long liquidation pressures ahead of the Tue/Wed FOMC meeting. Supportive factors included (1) the plunge in crude oil to a 5-1/2 year low, which prompted the 10-year breakeven inflation expectations rate to tumble to a 4-1/4 year low, and (2) increased safe-haven demand for Treasuries after the S&P 500 fell to a 1-1/2 month low.
The dollar index (DXY00 -0.73%) this morning is down -0.679 (-0.77%) at a 2-week low. EUR/USD (^EURUSD) is up +0.0112 (+0.90%) at a 2-1/2 week high. USD/JPY (^USDJPY) is down -2.12 (-1.80%) at a 4-week low. The dollar index on Monday closed higher. Closes: Dollar index +0.097 (+0.11%), EUR/USD -0.00251 (-0.10%), USD/JPY -0.923 (-0.78%). Bullish factors included (1) weakness in emerging market currencies as the Brazilian real fell to a 9-3/4 year low and the Russian ruble plunged to a record low against the dollar, and (2) speculation the FOMC will prepare the markets for an interest rate hike with a hawkish post-FOMC meeting statement on Wednesday.
Jan WTI crude oil (CLF15 -2.99%) this morning is down -$ 1.69 a barrel (-3.02%) at a new 5-1/2 year low and Jan gasoline (RBF15 -2.91%) is down -0.0488 (-3.10%) at a 5-1/2 year low. Jan crude and Jan gasoline prices Monday slumped to 5-1/2 year lows and closed lower. Closes: CLF5 -1.90 (-3.29%), RBF5 -0.0209 (-1.31%). Bearish factors included (1) a stronger dollar, and (2) comments from UAE Energy Minister Al-Mazrouei that OPEC will stand by its decision not to cut oil output even if crude prices fall as low as $ 40 a barrel and will wait at least three months before considering an emergency meeting.
|US||0830 ET||Nov housing starts expected +3.1% to 1.040 million, Oct -2.8% m/m to 1.009 million. Nov building permits expected -2.5% to 1.065 million, Oct +5.9% to 1.092 million.|
|0945 ET||Preliminary Dec U.S. Markit manufacturing PMI expected +0.7 to 55.5, Nov -1.1 to 54.8.|
|1030 ET||FOMC begins 2-day policy meeting.|
|EUR||0200 ET||Eurozone Nov new car registrations, Oct +6.5% y/y.|
|0400 ET||Eurozone Dec Markit manufacturing PMI expected +0.4 to 50.5, Nov 50.1. Dec composite PMI expected +0.4 to 51.5, Nov 51.1.|
|GER||0330 ET||German Dec Markit/BME manufacturing PMI expected +0.8 to 50.3, Nov 49.5. Dec Market services PMI expected +0.4 to 52.5, Nov 52.1.|
|0500 ET||German Dec ZEW survey expectations of economic growth expected +8.5 to 20.0, Nov 11.5. Dec ZEW current situation expected +1.7 to 5.0, Nov 3.3.|
|UK||0430 ET||UK Nov CPI expected unch m/m and +1.2% y/y, Oct +0.1% m/m and +1.3% y/y. Nov core CPI expected +1.5% y/y, Oct +1.5% y/y.|
|0430 ET||UK Nov RPI expected unch m/m and +2.2% y/y, Oct unch m/m and +2.3% y/y. Nov RPI ex-mortgage interest payments expected +2.3% y/y, Oct +2.4% y/y.|
|0430 ET||UK Nov PPI input prices expected -1.5% m/m and -9.2% y/y, Oct -1.5% m/m and -8.4% y/y.|
|0430 ET||UK Nov PPI output prices expected -0.3% m/m and -0.6% y/y, Oct -0.3% m/m and -0.5% y/y. Nov PPI output core expected unch m/m and +1.0% y/y, Oct +0.1% m/m and +0.9% y/y.|
|0430 ET||UK Oct ONS house prices expected +11.4% y/y, Sep +12.1% y/y.|
|JPN||1850 ET||Japan Nov trade balance expected -992.0 billion yen, Oct -736.9 billion yen. Nov exports expected +7.0% y/y, Oct +9.6% y/y. Nov imports expected +1.7% y/y, Oct +3.1% y/y.|
|Navistar International Corp||NAV US||Bef-mkt||Q4 2014 Earnings Release||Q4 2014||0.003|
|FactSet Research Systems Inc||FDS US||7:00||Q1 2015 Earnings Release||Q1 2015||1.319|
|CVS Health Corp||CVS US||8:00||Analyst Day||Y 2014|
|3M Co||MMM US||8:00||Q4 2015 Guidance Call||Q4 2015|
|Unum Group||UNM US||8:30||Investor Meeting||Y 2014|
|Navistar International Corp||NAV US||9:00||Q4 2014 Earnings Call||Q4 2014|
|Liberty Property Trust||LPT US||10:00||Q4 2015 Guidance Call||Q4 2015|
|T-Mobile US Inc||TMUS US||10:30||Un-Carrier Event|
|FactSet Research Systems Inc||FDS US||11:00||Q1 2015 Earnings Call||Q1 2015|
|AECOM Technology Corp||ACM US||11:00||Analyst Meeting||Y 2014|
|Amdocs Ltd||DOX US||11:30||Analyst & Investor Day||Y 2014|
|Colfax Corp||CFX US||13:00||Investor Meeting||Y 2014|
|General Electric Co||GE US||15:00||Investor Meeting||Y 2014|
|FactSet Research Systems Inc||FDS US||15:00||Annual General Meeting|
|Dow Chemical Co/The||DOW US||17:00||ITC Announce’s Judge’s Findings on Organik vs. Dow Chemical Trade Secret Case|
|Darden Restaurants Inc||DRI US||17:00||Q2 2015 Earnings Call||Q2 2015|
|Darden Restaurants Inc||DRI US||Aft-mkt||Q2 2015 Earnings Release||Q2 2015||0.273|
|Ameren Corp||AEE US||Investor Meeting||Y 2014|
|Hudson City Bancorp Inc||HCBK US||Annual General Meeting||Y 2014|
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