Morning Market Update
* US: Dow Futures: 12710.00 (0.19%), S&P 500 Futures: 1344.00 (0.23%), NASDAQ Futures: 2596.50 (0.35%)
* Europe: CAC: 3077.22 (0.36%), DAX: 6281.30 (0.53%), FTSE: 5546.09 (0.99%).
* Asia-Pacific: Australia: 4123.30 (-0.33%), China: 2300.80 (-0.66%), Hong Kong: 19416.67 (-0.06%), India: 5103.85 (0.78%), Japan: 8655.87 (-0.75%).
* Metals: Gold: 1629.10 (0.13%), Silver: 28.68 (0.03%), Copper: 3.40 (0.13%)
* Energy: Crude Oil: 83.43 (0.19%), Natural Gas: 2.62 (0.25%)
* Commodities: Corn: 5.47 (5.36%), Soya Bean: 13.70 (1.75%), Wheat: 6.85 (2.79%)
* Currency: EUR/USD: 1.2637 (0.48%), GBP/USD: 1.5685 (0.11%), USD/JPY: 78.9900 (-0.15%)
* 10 year US Treasury: 1.592% (0.019)
Financial and Economic News Update
U.S. stock-index futures rise:U.S. stock index futures are pointing to a higher open on Tuesday, as a fall in housing starts increased expectations that the Federal Reserve may stimulate the economy. The Commerce Department said housing starts declined 4.8 percent to a seasonally adjusted rate of 708,000 units in May, while building permits jumped to its highest in over three years. The Dow futures, the S&P futures and the NASDAQ futures were trading marginally in the green.
European markets in the green: European markets are up in trade today, with the German DAX (INDEXDB:DAX) trading 0.5 percent higher at 6281.30, the FTSE 100 (INDEXFTSE:UKX) up 1 percent at 5546.09, and the CAC 40 (INDEXEURO:PX1) rose 0.4 percent to 3077.22. The euro zone blue-chip ESTX 50 PR.EUR (INDEXSTOXX:SX5E) (Euro Stoxx 50) was trading 0.7 percent higher.
Asian markets end lower: Asian markets closed lower on Tuesday, with Japan’s NIKKEI 225 (INDEXNIKKEI:NI225) slipping 0.8 percent to 8,655.87. The HANG SENG INDEX (INDEXHANGSENG:HSI) closed down 0.1 percent at 19,416.7, while the SSE Composite Index (SHA:000001) (Shanghai Composite Index) ended 0.7 percent lower at 2,300.8 points. The S&P/ASX 200 (INDEXASX:XJO) index lost 0.3 percent to close at 4,123.3. The benchmark Indian 30-share BSE SENSITIVE (INDEXBOM:SENSEX) index rose 1 percent to 16,871.20 points.
Stocks in Focus
* FedEx Corporation (NYSE:FDX) posted fiscal fourth-quarter earnings, excluding certain items, of $1.99 per share, seven cents above estimates. But provided current quarter and full-year earnings guidance that was short of estimates.
* Barnes & Noble, Inc. (NYSE:BKS) reported a narrower than expected fiscal fourth-quarter loss of $57.6 million or $1.08 per share. Revenue came in flat at $1.38 billion, which was below analysts’ estimates.
* Discover Financial Services (NYSE:DFS) posted second quarter profit of $537 million, or $1.00 per share, in line with the analysts’ estimate. Revenue increased 6 percent to $1.85 billion, against Street expectation of $1.86 billion.
* Jefferies Group, Inc. (NYSE:JEF) reported second quarter net profit of $63.5 million, or 28 cents a share, that beat analysts’ estimates.
* Drugstore chain Walgreen Company (NYSE:WAG) acquired a 45 percent equity ownership stake in Switzerland-based drug wholesaler, Alliance Boots for $6.7 billion, in a cash and stock deal.
* Microsoft Corporation (NASDAQ:MSFT) unveiled a Windows tablet computer called Surface at a much-hyped press event in Los Angeles late Monday.
* Jamie Dimon, Chief Executive Officer of JPMorgan Chase & Co. (NYSE:JPM) will today testify before the House Financial Services Committee about the financial giant’s $2 billion trading loss from a failed hedging strategy.
* J.C. Penney Company, Inc. (NYSE:JCP) president Michael Francis, who was in charge of the company’s marketing and merchandising, has left the retailer, after just over eight months on the job.
* The Bank of New York Mellon Corporation (NYSE:BK) has settled a dispute with Prudential Financial Inc (NYSE:PRU) over the pricing of its foreign exchange transactions, and has agreed to repay more than half the revenue it generated from the currency trades with Prudential.
* Industrial gas supplier Air Products and Chemicals, Inc (NYSE:APD) has agreed to acquire a 67 percent stake in Chilean industrial gas company Indura SA for $884 million to expand in the fast-growing Latin American region.
* Vancouver-based fuel cell company Ballard Power Systems Inc. (NASDAQ:BLDP) has cut its 2012 revenue and earnings forecast.
* Technology and telecommunications equipment company Sonus Networks, Inc. (NASDAQ:SONS) will acquire smaller rival Network Equipment Technologies, Inc. (NASDAQ:NWK) in a transaction valued at $42 million.
* The board of software maker Autodesk, Inc. (NASDAQ:ADSK) has authorized the addition of 30 million shares to its stock buyback program.
* Technology provider PerkinElmer, Inc. (NYSE:PKI) and medical products maker Baxter International Inc. (NYSE:BAX), have been added to the “Conviction Buy” list at Goldman Sachs.
* Piper Jaffray has downgraded travel website operator Expedia Inc (NASDAQ:EXPE) to “neutral” from “overweight” citing valuation concerns. The stock was down 2 percent in New York pre-market trading.
* French dairy company Groupe Danone SA (EPA:BN) lowered its 2012 operating margin target, citing a drop in demand in southern Europe, particularly in Spain. The company expects an operating margin to drop by 0.5 percentage point on a like-for-like basis.
* British engineering company The Weir Group PLC (LON:WEIR) has reconfirmed its full year guidance, and gave an upbeat assessment of its minerals business. Jefferies has reiterated its ‘buy’ recommendation on the stock, with a target price of 2,185p.
* British hotel and restaurant group Whitbread plc (LON:WTB) reported a 14 percent rise in first-quarter sales, driven by a 4.5 percent increase in same-store sales.
* Swiss phamaceuticals company Roche Holding AG (FRA:RHO5) has forged an alliance with Seaside Therapeutics to develop treatments for autism spectrum disorders and fragile X syndrome.
* Home Retail Group Plc (LON:HOME), the owner of the Argos and Homebase chains, posted first quarterly revenue that fell less than analysts what had estimated.
* U.K.’s third-largest natural-gas producer BG Group plc (LON:BG) sold $1.57 billion of hybrid bonds to fund future projects.
* Standard Chartered PLC (LON:STAN) was upgraded to “buy” from “neutral” at Bank of America Corp (NYSE:BAC). The stock is up 1.8 percent in London trading.
* Australian mining magnate Gina Rinehart, who recently raised her stake in Fairfax Media Limited (ASX:FXJ), is seeking three seats on the board of the country’s second- largest newspaper publisher, and the ability to fire editors, the Sydney Morning Herald reported today.
* Japan’s biggest brokerage Nomura Holdings, Inc. (ADR) (NYSE:NMR) has been left off the list of companies selected to manage the government’s sale of about $6 billion of Japan Tobacco Inc (TYO:2914) shares, one of the largest share offerings in the country this year.
* Pacific Basin Shipping Limited (HKG:2343), Hong Kong’s biggest operator of dry-bulk ships predicted a first-half loss. The company also wrote down the value of its roll-on, roll-off, ships by $190 million, the third such write down in four years.
* Hong Kong-listed shares of Tsingtao Brewery Company Limited (HKG:0168), China’s second-biggest brewery by volume, tumbled 7.8 percent after a Dow Jones Newswires report that Chinese billionaire and major shareholder, Chen Fa-shu, was paring his stake in the company by selling 32 million shares.
* Taiwan-based Hon Hai Precision Industry Co., Ltd. (TPE:2317), one of Apple Inc. (NASDAQ:AAPL)’s primary manufacturing partners, is in talks with Sharp Corporation (TYO:6753) about increasing its stake in the Japanese electronics giant.
Economic Calendar for Tuesday, June 19, 2012:
07:45 A.M. ET: ICSC-Goldman Store Sales (Week ending Saturday, June 16, 2012)
08:30 A.M. ET: Housing Starts (MoM) (May)
08:30 A.M. ET: Building Permits (MoM) (May)
08:55 A.M. ET: Redbook (Week ending Saturday, June 16, 2012)
11:30 A.M. ET: 4-Week Bill Auction