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NYSE Morning Update 08/12/2013

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Ahead of the Bell: Dow futures are trading down 50 points and S&P futures are trading down 6 points.  Investors are optimistic the slowdown in China has run its course and expectations this week that economic data from the euro zone will show the region might soon exit the longest recession since the 17-member bloc was created.  The EU is scheduled to release GDP and consumer sentiment figures this week.  Equity markets remain jittery over prospects that the Federal Reserve will scale back its stimulus program. China reported bank loans and money supply for July were higher than expected, while Japan's economy grew at an annualized rate of 2.6% in the second quarter for a third consecutive quarter, but below forecast.   



  • On the economic calendar today, the Treasury Budget for June will be out prior to the opening bell; it is forecasted to be $-96.0B compared with $116.5B for May. 

  • The dollar is up against the euro and the Japanese yen and down against the British pound.  Gold is trading at $1,326. Crude oil is currently trading at $105 a barrel.   

  • Last week, stocks retreated on fears the Federal Reserve will scale back its stimulus program, despite better than expected economic data from the US, Germany, and China. Investors were concerned the Fed will taper its quantitative easing program in September rather than later in the year.  For the week, the Dow fell 1.5%, while the S&P 500 index declined 1.1%.  The economic data was better than expected as the economy continues to improve.  Weekly jobless claims fell to the lowest since 2007, as fewer Americans filed for unemployment benefits over the past month, indicating the labor market is making progress.  The Commerce Department reported the trade deficit narrowed sharply in June, suggesting an upward revision to second-quarter growth.  The ISM non-manufacturing survey surged in July that drove the index up substantially to its best reading since February.  Germany and UK reported upbeat factory and manufacturing activity in June, suggesting the region's long recession is coming to an end.  The Bank of England said it will keep interest rates at record lows until the unemployment rate falls to 7%, a major shift in the bank's monetary.

  • The week ahead, a few economic reports and earnings season are likely to move financial markets. The batch of companies that are left to report second quarter earnings are mostly retailers and consumer spending will be in the spot light. With the back-to-school season in full swing, there are a smattering of retailers reporting this week, including Macy's, Wal-Mart, Nordstrom, Kohl's, Home Depot, Target, and Staples. The equity markets could get a much needed boost if retailers report better than expect quarterly results, particularly since most traders are away on vacation. Volume has been low, as August is traditionally a slow month for the equity market. On the economic calendar the Commerce Department will report retail sales data for July. Investors will also get a look at inflation data from both the consumer and business sectors in the form of CPI and PPI. There will also be consumer spending and sentiment data this week. The Federal Reserve will be keenly looking at the inflation data to assure it remains at 2%. The manufacturing sector will also provide Empire manufacturing, Philadelphia Fed survey, and industrial data.  The National Association of Home Builders will release housing starts and building permits for July. Investors will be thinking about the elections in Germany which is about two weeks away. Chancellor Angels Merkel is up for reelection and she has been a staunch supporter for global stimulus. Markets participants will be watching closely as any change in EU monetary policy will impact US financial markets.

  • On CNBC today, David Blitzer, Managing Director and Chairman of the S&P Index Committee and James Woolery, Head of North American Mergers & Acquisitions at JPMorgan, talked about where the equity market is heading.  Blitzer said the Lawrence Summers/Janet Yelling issue will settle itself.  The debt ceiling vote and budget issues are the concerns, the clock is ticking on the debt ceiling vote, as it sizing up to be a nasty fight in the fall.  President Barack Obama and Congress don’t appear to be in a deal making mode.  We don’t know the exact date for the debt ceiling vote yet, but the US will not default on its obligations. This will be a messy September and October over the debt ceiling vote, and it will be choppy for the equity markets.  Woorley said the equity markets will be higher towards the end of the year.  He pointed out, deals drive this market we and need some certainty from the Federal Reserve and Washington.  Woorley added, you can never get complete certainty, but you can get some degrees of certainty, and that can give confidence to the markets.

  • Happy Monday and have a wonderful week!

Friday’s Close


DJIA down 72.81 pts/-0.47%/ 15,425.51


S&P down 6.06 pts/-0.36%/ 1,691.42


Nasdaq down 9.02 pts/-0.25%/ 3,660.11


 


Monday’s Futures


Dow Futures down 50.27 pts/-0.33%


S&P Futures down 6.50 pts/-0.40%


Nasdaq Futures down 9.25 pts/-0.30%


 


Overseas Markets


FTSE -0.26%


CAC 40 -0.16%


NIKKEI 225 -0.70%


HANG SENG +2.13%


 


Overseas:  World stock markets are down today.  European and Asian markets are down on lower growth from Japan and fears the Federal Reserve will taper its stimulus program.


 


Economic Reports: Treasury Budget expected to be $-96.0B at 2:00 p.m., later in the week NFIB Small Business Optimism Index, Retail Sales, Import and Export Prices, Business Inventories, MBA Purchase Applications, Producer Price Index, Atlanta Fed Business Inflation Expectations, Consumer Price Index, Jobless Claims, Empire State Mfg Survey, Treasury International Capital, Industrial Production, Housing Market Index, Philadelphia Fed Survey, Fed Balance Sheet, Housing Starts, Productivity and Costs, and Consumer Sentiment.


 


Top Headlines:    



  • American Tower Corporation (AMT) said it is acquiring towers in Brazil and Mexico from Latin American telecom service provider NII Holdings for about $811 million.

  • Rockwell Collins Inc. (COL) announced it is acquiring ARINC Incorporated from Carlyle Group (CG) for $1.39 billion to gain access to the air-traffic control systems market.

  • Caesars Entertainment Corporation (CZR) announced it is selling its golf course in Macau to Pearl Dynasty Investment Ltd for $438 million.          

Commodities/Currency:


Gold:up $14.90 to $1,326.50
Oil:down 0.02 to $105.95

EUR/USD 1.3293 -0.0041
USD/JPY 96.685 +0.3900
GBP/USD 1.5486 -0.0011


 


Volatility Index (VIX): As of the close of business Friday, August 9, 2013 the VIX is up 0.68 at 13.41


Companies Reporting Quarterly Earnings:


 


Brigus Gold reports Q2 EPS (2c), vs. Est 2c and Q2 revenue $30.4M, vs. Est $31.19M.


 


CTI Industries reports Q2 EPS (2c), vs. Est 3c and Q2 revenue $13.03M, vs. Est $14.11M


 


iGo reports Q2 EPS (81c) vs. ($1.24) a year ago Reports Q2 revenue $4.71M vs. $7.29M a year ago.


 


Sky-mobi reports Q1 EPS 0c, vs. Est (2c) and Q1 revenue $20.4M,  vs. Est $18.5M.


 


Today’s Opening and Closing Bells:


 


New York Yankees First Baseman, Mark Teixeira #25 will ring the opening bell.


 


The Neuropathy Association will ring the closing bell.


 


 


    


 


 


Paras Madho


Corporate Actions & Market Watch


NYSE Euronext | Global Corporate Client Group
11 Wall Street | New York NY 10005
P:  (212) 656-5404


pmadho@nyx.com


 


Exclusive Market Intelligence, Insight, and Network: www.NYSEConnect.com


 


 


Nothing herein constitutes an offer to sell or a solicitation of an offer to buy any security or a recommendation of any security or trading practice. Some information included above has been aggregated from multiple public third-party financial news sources for informational purposes only and redistributed to the NYSE Euronext community.  NYSE Euronext does not control the content provided by these sources and does not guarantee the accuracy, integrity or quality of such content.    


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