MORNING CALL
Wednesday, November 4th, 2015View Older Reports
Everything you need to know about the markets in one free daily newsletter.
E-mail:
You will also receive a free subscription to the Barchart family of newsletters.
OVERNIGHT MARKETS AND NEWS
December E-mini S&Ps (ESZ15 +0.14%) are up +0.11% and European stocks are up +0.61% at a 2-1/2 month high on expectations of further stimulus from the ECB. Comments made late yesterday after European markets closed from ECB President Draghi gave stocks and European government bonds a boost when he said the ECB is "willing and able" to act to support the recovery. Also, energy producers and basic-resource companies gained as the price of crude oil and copper moved higher. On the negative side, automakers were lower led by a nearly 9% plunge in Volkswagen AG, as the emissions scandal widened after the company said it found faulty emissions readings for the first time in gasoline-powered vehicles. Asian stocks settled mostly higher: Japan +1.30%, Hong Kong +2.15%, China +4.31%, Taiwan +1.65%, Australia +0.06%, Singapore +1.36%, South Korea +0.08%, India -0.14%. China's Shanghai Composite climbed to a 2-1/4 month high on speculation the government will continue to support the recovery after comments made after Asian markets closed Tuesday from Chinese President Xi Jinping that China GDP should be no less than 6.5% over the next 5 years.
The dollar index (DXY00 +0.20%) is up +0.25%. EUR/USD (^EURUSD) is down -0.26% after comments from ECB President Draghi bolstered expectations for additional ECB stimulus. USD/JPY (^USDJPY) is up +0.13%.
Dec T-note prices (ZNZ15 +0.11%) are up +1.5 ticks.
Speaking as part of a panel on financial stability at an event hosted by the ECB, Fed Governor Brainard said he sees some encouraging aspects for the U.S. economic outlook but there are still some elements of slack in the U.S. economy. He added that core inflation "has remained somewhat below target" and that the Fed is carefully monitoring inflation expectations.
U.S. STOCK PREVIEW
Key U.S. news today includes: (1) Fed Governor Lael Brainard's participation in a panel discussion on financial stability at the ECB in Frankfurt, (2) weekly MBA mortgage applications (previous -3.5% with purchase mortgage sub-index -3.1% and refi sub-index -3.8%), (3) welcoming remarks by Philadelphia Fed President Patrick Harker at an event on capital for communities in Philadelphia, PA, (4) Oct ADP employment (expected +180,000, Sep +200,000), (5) Sep U.S. trade deficit (expected -$41.00 billion, -$48.33 billion), (6) final-Oct Markit services PMI (expected +0.2 to 54.6, prelim-Oct -0.7 to 54.4), (7) Oct ISM non-manufacturing index (expected -0.4 to 56.5, Sep -2.1 to 56.9), (8) Fed Chair Yellen's appearance before the House Financial Services Committee on bank regulation, (9) the Treasury's auction of $26 billion of 2-year T-notes, (10) New York Fed President William Dudley's speech on the economy in New York, and (11) Fed Vice Chair Stanley Fischer's speech to the National Economists Club.
There are 26 of the S&P 500 companies that report earnings today with notable reports including: Facebook (consensus $0.52), Metlife (0.76), Prudential Financial (2.42), Transocean (0.65), Time Warner (1.09), Motorola Solutions (0.73), Marathon Oil (-0.41), Whole Foods (0.35),
U.S. IPO's scheduled to price today: HC2 Holdings (HCHC), Kura Oncology (KURO).
Equity conferences during the remainder of this week include: Goldman Sachs Industrials Conference on Tue-Wed, Citi China Investor Conference on Wed, Citi Industrials Conference on Wed, Citi Global Health Care Conference on Thu, Needham Next Generation Storage Networking Conference on Thu, Bernstein Technology Innovation Summit on Thu-Fri, BancAnalysts Association of Boston Conference on Thu-Fri.
OVERNIGHT U.S. STOCK MOVERS
Tesla (TSLA -2.54%) soared 8% in after-hours trading after it reported a Q3 adjusted loss of -58 cents, a bigger loss than consensus of -56 cents, but said it will deliver 17,000 to 19,000 vehicles in Q4, more than the 16,820 vehicles needed to reach its full-year target of 50,000 to 52,000 vehicles.
Allergan Plc (AGN -1.78%) reported Q3 EPS of $3.48, better than consensus of $3.18.
Becton Dickson (BDX +1.26%) reported Q4 EPS of $1.94, higher than consensus of $1.90.
Groupon (GRPN +5.22%) plunged over 25% in pre-market trading after it reported Q3 adjusted EPS of 5 cents, more than double consensus of 2 cents, but then lowered guidance on Q4 revenue to $815 million-$865 million, well below consensus of $956.3 million.
Nortek (NTK +1.13%) lowered guidance on fiscal 2015 net sales to $2.500 billion-$2.515 billion from an earlier estimate of $2.500 billion-$2.575 billion, below consensus of $2.560 billion.
U.S. Steel (X +0.94%) slumped over 10% in after-hours trading after it reported a Q3 EPS loss of -70 cents, a much wider loss than consensus of -20 cents and said it sees "significantly" lower shipments and average realized prices than previously projected for 2015.
Diplomat Pharmac (DPLO +1.88%) surged over 10% in after-hours trading after it reported Q3 adjusted EPS of 26 cents, well above consensus of 16 cents, and then raised guidance on fiscal 2015 EPS to 69 cents-73 cents from 56 cents-60 cents, above consensus of 59 cents.
Zendesk (ZEN +1.30%) jumped over 9% in after-hours trading after it reported Q3 adjusted EPS loss of -5 cents, a smaller loss than consensus of -9 cents.
MasTec (MTZ -0.81%) reported Q3 adjusted EPS of 26 cents, below consensus of 34 cents, and then lowered guidance on fiscal 2015 revenue to $4.1 billion-$4.15 billion, less than consensus of $4.27 billion.
Papa John's (PZZA -5.80%) slid over 7% in after-hours trading after it reported Q3 adjusted EPS of 45 cents, right on consensus, but reported Q3 revenue of $389.3 million, below consensus of $398.4 million.
Zillow (Z +3.65%) fell over 8% in after-hours trading after it reported an unexpected Q3 EPS profit of 7 cents, better than consensus for a -3 cent loss, but lowered guidance on Q4 revenue to $165 million-$170 million, below consensus of $179.1 million.
Parker Drilling (PKD -0.33%) reported a Q3 adjusted loss of -10 cents, a smaller loss than consensus of -13 cents.
MARKET COMMENTS
Dec E-mini S&Ps (ESZ15 +0.14%) this morning are up +2.25 points (+0.11%). Tuesday's closes: S&P 500 +0.27%, Dow Jones +0.50%, Nasdaq +0.32%. The S&P 500 on Tuesday rallied to a 3-1/4 month high and closed higher on underlying support from better-than-expected Q3 earnings and a rally in energy producers after crude oil prices climbed to a 2-week high. Stocks were undercut by the -1.0% decline in U.S. Sep factory orders, weaker than expectations of -0.9%.
Dec 10-year T-notes (ZNZ15 +0.11%) this morning are up +1.5 ticks. Tuesday's closes: TYZ5 -8.50, FVZ5 -5.00. Dec T-notes on Tuesday tumbled to a 2-1/2 month nearest-futures low and closed lower on reduced safe-haven demand with the rally in the S&P 500 to a 3-1/4 month high and on increased inflation expectations after the 10-year T-note inflation breakeven rate rose to a 1-1/2 month high.
The dollar index (DXY00 +0.20%) this morning is up +0.247 (+0.25%). EUR/USD (^EURUSD) is down -0.0029 (-0.26%). USD/JPY (^USDJPY) is up +0.16 (+0.13%). Tuesday's closes: Dollar Index +0.230 (+0.24%), EUR/USD -0.0052 (-0.47%), USD/JPY +0.31 (+0.26%). The dollar index on Tuesday closed higher on the jump in the 10-year T-note yield to a 2-1/2 month high and weakness in EUR/USD on divergent central bank policies with the Fed expected to raise interest rates while the ECB is expected to maintain or even expand QE.
Dec crude oil (CLZ15 +0.52%) this morning is up +9 cents (+0.19%) and Dec gasoline (RBZ15 +1.35%) is up +0.0137 (+0.95%). Tuesday's closes: CLZ5 +1.54 (+3.34%), RBZ5 +0.0657 (+4.78%). Dec crude oil and gasoline prices on Tuesday closed higher with Dec crude at a 2-week high and Dec gasoline at a 3-week high. Crude oil and gasoline prices rallied on expectations that Wednesday's weekly EIA data will show gasoline inventories fell -1.25 million bbl and the jump in the crack spread to a 1-month high, which may increase refinery demand for crude as refiners boost gasoline production to take advantage of the improved profit margins.
GLOBAL EVENT CALENDAR11/04/2015
US
0530 ET
Fed Governor Lael Brainard takes part in a panel discussion on financial stability at the ECB in Frankfurt.
0700 ET
Weekly MBA mortgage applications, previous -3.5% with purchase mortgage sub-index -3.1% and refi sub-index -3.8%.
0800 ET
Philadelphia Fed President Patrick Harker gives welcoming remarks at an event on capital for communities in Philadelphia, PA.
0815 ET
Oct ADP employment change expected +180,000, Sep +200,000.
0830 ET
Sep trade balance expected -$41.00 billion, -$48.33 billion.
0830 ET
Treasury announces amount of 3-year T-notes (previous $24 billion), 10-year T-notes (previous $21 billion) and 30-year T-bonds (previous $13 billion) to be auctioned Nov 9-12 in the Nov quarterly refunding.
0945 ET
Final-Oct Markit services PMI expected +0.2 to 54.6, prelim-Oct -0.7 to 54.4. Final-Oct Markit composite PMI, prelim-Oct -0.5 to 54.5.
1000 ET
Oct ISM non-manufacturing index expected -0.4 to 56.5, Sep -2.1 to 56.9.
1000 ET
Fed Chair Yellen appears before the House Financial Services Committee on bank regulation.
1030 ET
EIA Weekly Petroleum Status Report.
1300 ET
Treasury auctions $26 billion of 2-year T-notes.
1430 ET
New York Fed President William Dudley speaks on the economy in New York.
1930 ET
Fed Vice Chair Stanley Fischer speaks to the National Economists Club.
JPN
0100 ET
Japan Oct consumer confidence expected +0.2 to 40.8, Sep 40.6.
GER
0355 ET
Revised German Oct Markit services PMI, previous +1.1 to 55.2.
EUR
0400 ET
Revised Eurozone Oct Markit composite PMI, previous +0.4 to 54.0.
0500 ET
Eurozone Sep PPI expected -0.5% m/m and -3.3% y/y, Aug -0.8% m/m and -2.6% y/y.
0545 ET
ECB President Mario Draghi speaks at an event in Milan, Italy.
UK
0430 ET
UK Oct Markit/CIPS services PMI expected +1.2 to 54.5, Sep 53.3.
U.S. STOCK CALENDAR11/04/2015
Company
Ticker
Time
Event Description
Period
Estimate
Becton Dickinson and Co
BDX US
Bef-mkt
Q4 2015 Earnings Release
Q4 2015
1.899
WEC Energy Group Inc
WEC US
Bef-mkt
Q3 2015 Earnings Release
Q3 2015
0.59
Time Warner Inc
TWX US
Bef-mkt
Q3 2015 Earnings Release
Q3 2015
1.088
Regeneron Pharmaceuticals Inc
REGN US
Bef-mkt
Q3 2015 Earnings Release
Q3 2015
3.213
Allergan plc
AGN US
Bef-mkt
Q3 2015 Earnings Release
Q3 2015
3.177
Chesapeake Energy Corp
CHK US
Bef-mkt
Q3 2015 Earnings Release
Q3 2015
-0.136
Henry Schein Inc
HSIC US
Bef-mkt
Q3 2015 Earnings Release
Q3 2015
1.467
Cognizant Technology Solutions Corp
CTSH US
Bef-mkt
Q3 2015 Earnings Release
Q3 2015
0.759
NRG Energy Inc
NRG US
Bef-mkt
Q3 2015 Earnings Release
Q3 2015
0.741
Spectra Energy Corp
SE US
Bef-mkt
Q3 2015 Earnings Release
Q3 2015
0.221
Michael Kors Holdings Ltd
KORS US
Bef-mkt
Q2 2016 Earnings Release
Q2 2016
0.892
Motorola Solutions Inc
MSI US
7:00
Q3 2015 Earnings Release
Q3 2015
0.729
Twenty-First Century Fox Inc
FOXA US
7:30
Q1 2016 Earnings Release
Q1 2016
0.375
Alcoa Inc
AA US
8:00
Investor Day
Y 2015
Becton Dickinson and Co
BDX US
8:00
Q4 2015 Earnings Call
Q4 2015
Cardinal Health Inc
CAH US
8:00
Annual General Meeting
Y 2015
Cognizant Technology Solutions Corp
CTSH US
8:00
Q3 2015 Earnings Call
Q3 2015
Michael Kors Holdings Ltd
KORS US
8:00
Q2 2016 Earnings Call
Q2 2016
Motorola Solutions Inc
MSI US
8:30
Q3 2015 Earnings Call
Q3 2015
Twenty-First Century Fox Inc
FOXA US
8:30
Q1 2016 Earnings Call
Q1 2016
Regeneron Pharmaceuticals Inc
REGN US
8:30
Q3 2015 Earnings Call
Q3 2015
Allergan plc
AGN US
9:00
Q3 2015 Earnings Call
Q3 2015
Chesapeake Energy Corp
CHK US
9:00
Q3 2015 Earnings Call
Q3 2015
Coach Inc
COH US
9:00
Annual General Meeting
NRG Energy Inc
NRG US
9:00
Q3 2015 Earnings Call
Q3 2015
Spectra Energy Corp
SE US
9:00
Q3 2015 Earnings Call
Q3 2015
Henry Schein Inc
HSIC US
10:00
Q3 2015 Earnings Call
Q3 2015
Time Warner Inc
TWX US
10:30
Q3 2015 Earnings Call
Q3 2015
ONEOK Inc
OKE US
11:00
Q3 2015 Earnings Call
Q3 2015
Allergan plc
AGN US
11:00
R&D Day
Y 2015
Newfield Exploration Co
NFX US
11:00
Q3 2015 Earnings Call
Q3 2015
Devon Energy Corp
DVN US
11:00
Q3 2015 Earnings Call
Q3 2015
Cimarex Energy Co
XEC US
11:00
Q3 2015 Earnings Call
Q3 2015
Lam Research Corp
LRCX US
12:30
Annual General Meeting
Y 2015
Apartment Investment & Management Co
AIV US
13:00
Q3 2015 Earnings Call
Q3 2015
WEC Energy Group Inc
WEC US
14:00
Q3 2015 Earnings Call
Q3 2015
KLA-Tencor Corp
KLAC US
15:00
Annual General Meeting
Computer Sciences Corp
CSC US
16:15
Q2 2016 Earnings Release
Q2 2016
1.155
QUALCOMM Inc
QCOM US
16:45
Q4 2015 Earnings Call
Q4 2015
CenturyLink Inc
CTL US
17:00
Q3 2015 Earnings Call
Q3 2015
Computer Sciences Corp
CSC US
17:00
Q2 2016 Earnings Call
Q2 2016
Whole Foods Market Inc
WFM US
17:00
Q4 2015 Earnings Call
Q4 2015
Microchip Technology Inc
MCHP US
17:00
Q2 2016 Earnings Call
Q2 2016
Facebook Inc
FB US
17:00
Q3 2015 Earnings Call
Q3 2015
CenturyLink Inc
CTL US
Aft-mkt
Q3 2015 Earnings Release
Q3 2015
0.686
Kimco Realty Corp
KIM US
Aft-mkt
Q3 2015 Earnings Release
Q3 2015
0.368
Marathon Oil Corp
MRO US
Aft-mkt
Q3 2015 Earnings Release
Q3 2015
-0.414
QUALCOMM Inc
QCOM US
Aft-mkt
Q4 2015 Earnings Release
Q4 2015
0.863
Whole Foods Market Inc
WFM US
Aft-mkt
Q4 2015 Earnings Release
Q4 2015
0.345
Microchip Technology Inc
MCHP US
Aft-mkt
Q2 2016 Earnings Release
Q2 2016
0.629
Transocean Ltd
RIG US
Aft-mkt
Q3 2015 Earnings Release
Q3 2015
0.654
Prudential Financial Inc
PRU US
Aft-mkt
Q3 2015 Earnings Release
Q3 2015
2.419
MetLife Inc
MET US
Aft-mkt
Q3 2015 Earnings Release
Q3 2015
0.759
CF Industries Holdings Inc
CF US
Aft-mkt
Q3 2015 Earnings Release
Q3 2015
0.733
Facebook Inc
FB US
Aft-mkt
Q3 2015 Earnings Release
Q3 2015
0.52
WestRock Co
WRK US
Aft-mkt
Q4 2015 Earnings Release
Q4 2015
0.946
Costco Wholesale Corp
COST US
21:00
October 2015 Sales and Revenue Release
2015
Western Digital Corp
WDC US
Annual General Meeting
Perrigo Co PLC
PRGO US
Annual General Meeting
Perrigo Co PLC
PRGO US
Annual General Meeting
Linear Technology Corp
LLTC US
Annual General Meeting
AutoNation Inc
AN US
October 2015 Sales and Revenue Release
2015
United Parcel Service Inc
UPS US
Roadshow - Day1
Y 2015