Morning Market Update
Stocks that are expected to trade actively in U.S. markets on Thursday include: Hewlett-Packard Company (NYSE:HPQ), Abercrombie & Fitch Co. (NYSE:ANF), Wells Fargo & Co (NYSE:WFC), L Brands Inc (NYSE:LTD), Onyx Pharmaceuticals, Inc. (NASDAQ:ONXX), Amgen, Inc. (NASDAQ:AMGN), Hormel Foods Corporation (NYSE:HRL), Peabody Energy Corporation (NYSE:BTU), Sears Holdings Corp (NASDAQ:SHLD), The Hain Celestial Group, Inc. (NASDAQ:HAIN), Williams Companies, Inc. (NYSE:WMB)
Market Levels:
US: Dow Futures: 14907.00 (0.40%), S&P 500 Futures: 1645.75 (0.57%), NASDAQ Futures: 3084.50 (0.72%)
Europe: CAC: 4053.99 (0.97%), DAX: 8374.62 (1.08%), FTSE: 6447.25 (0.88%)
Asia-Pacific: Australia: 5075.70 (-0.48%), China: 2067.12 (-0.28%), Hong Kong: 21895.40 (0.35%), Japan: 13365.17 (-0.44%).
Metals: Gold: 1370.10 (0.01%), Silver: 23.19 (0.99%), Copper: 3.37 (1.80%)
Energy: Crude Oil: 104.02 (0.16%), Natural Gas: 3.51 (1.42%)
Commodities: Corn: 4.78 (-0.93%), Soya Bean: 12.91 (-0.94%), Wheat: 6.46 (-0.50%)
Currency: EUR/USD: 1.3335 (-0.15%), GBP/USD: 1.5595 (-0.45%), USD/JPY: 98.4800 (0.82%)
10-year US Treasury: 2.891% (-0.003)
Market and Economic News Update:
U.S. stock-index futures gain: U.S. stock-index futures are pointing to a higher open on Thursday, following upbeat manufacturing data from the euro zone and China. In economic news, U.S. flash manufacturing PMI edged up to 53.9 in August from 53.7 in July. Also, jobless claims rose by 13,000 to 336,000 last week, just above the 330,000 expected by economists. Up ahead, the leading economic index is scheduled for release at 10 a.m. ET, with economists expecting the indicators to rise 0.5 percent in July.
European markets rise: European markets are up in trade, as upbeat data from the region offset Fed “tapering” concerns. On the economic front, Markit’s preliminary composite PMI for the euro zone rose to a 26-month high of 51.7 in August, up from 50.5 in July. The CAC 40 (INDEXEURO:PX1) rallied 1 percent to 4053.99 points, while the DAX (INDEXDB:DAX) jumped 1.1 percent to 8374.62. The FTSE 100 (INDEXFTSE:UKX) edged 0.9 percent higher to 6447.25 points. The euro zone blue-chip ESTX 50 PR.EUR (INDEXSTOXX:SX5E) (Euro Stoxx 50) was up 1.3 percent in recent trading.
Asian stocks end mostly lower: Asian markets lost in trade amid concerns over a looming withdrawal of U.S. monetary stimulus, but a surprise improvement in Chinese manufacturing helped pare earlier losses. The SSE Composite Index (SHA:000001) (Shanghai Composite Index) fell 0.3 percent in a choppy session of trade, despite Chinese manufacturing PMI rising to a four-month high of 50.1 in August. The NIKKEI 225 (INDEXNIKKEI:NI225) reversed early morning losses to close 0.4 percent lower. The S&P/ASX 200 (INDEXASX:XJO) index retreated from a two-week low as the Australian dollar trimmed losses following better than expected Chinese manufacturing data.
Stocks in News:
Hewlett-Packard Company (NYSE:HPQ)
Hewlett-Packard Company (NYSE:HPQ) posted fiscal third-quarter earnings excluding items of 86 cents per share on revenue of $27.23 billion, versus Wall Street expectations for profits of 86 cents a share on revenue of $27.3 billion. For the full year, the tech bellwether sees adjusted EPS of $3.53 to $3.57. Hewlett-Packard also announced a shake up in its executive ranks, with Bill Veghte replacing Dave Donatelli at the helm of the Enterprise Group, the company’s second-largest business division.
Abercrombie & Fitch Co. (NYSE:ANF)
Abercrombie & Fitch Co. (NYSE:ANF)’s second-quarter profit fell to $11.4 million, or 14 cents a share, from $17.05 million, or $0.20 a share, in the year-ago period. Revenue dropped to $945.7 million, from $951.4 million a year earlier, Comparable store sales fell 10 percent globally and 11 percent in the U.S, the clothing company said Thursday. Analysts had projected earnings of 28 cents a share on sales of $997 million. Abercrombie sees third-quarter earnings in a range of 40 to 45 cents per share, but declined to provide full-year outlook. Shares in Abercrombie plunged in pre-market trading.
Wells Fargo & Co (NYSE:WFC)
Wells Fargo & Co (NYSE:WFC) announced that its mortgage unit is cutting 2,300 jobs due to falling demand for refinancing following the sharp run-up in interest rates. The country’s largest mortgage lender sent 60-day notices to 2,300 people in its home-lending unit. The latest job cuts represent about 20 percent of the 11,406 mortgage loan officers employed by the bank as of March 31.
L Brands Inc (NYSE:LTD)
The parent company of Victoria’s Secret and Bath & Body Works said second-quarter earnings came in at 61 cents per share, ahead of the consensus estimate of 60 cents a share. Sales increased 5 percent to $2.52 billion, while same-store sales rose 2 percent. For the current-quarter, L Brands sees earnings of between 23 cents and 28 cents per share, below current Street projections. Shares were down sharply in pre-market trading.
Onyx Pharmaceuticals, Inc. (NASDAQ:ONXX), Amgen, Inc. (NASDAQ:AMGN)
Onyx Pharmaceuticals, Inc. (NASDAQ:ONXX) is giving potential buyers access to trial data on its new blood cancer drug Kyprolis, according to a Reuters report. Lead bidder Amgen, Inc. (NASDAQ:AMGN) is currently in advanced talks to buy Onyx for $130 per share, or about $9.5 billion, and had sought data from an ongoing trial on Kyprolis.
Hormel Foods Corporation (NYSE:HRL)
Hormel Foods Corporation (NYSE:HRL) reported weaker than expected quarterly earnings, hurt by higher raw material costs that squeezed margins. For fiscal third-quarter, the company earned 42 cents per share, missing estimates by three cents. Sales grew 7.5 percent to $2.16 billion, topping expectations for $2.12 billion. Shares were inactive at $42.11 pre-market.
Peabody Energy Corporation (NYSE:BTU)
Peabody Energy Corporation (NYSE:BTU) has announced that veteran mining executive Glenn Kellow will be its new president and chief operating officer. Kellow most recently served as president of BHP Billiton Limited (ADR) (NYSE:BHP)’s multinational Aluminum and Nickel business. Shares closed Wednesday at $16.59, and were up more than a percent in the pre-open session.
Sears Holdings Corp (NASDAQ:SHLD)
Sears Holdings Corp (NASDAQ:SHLD) posted second-quarter loss of $194 million, or $1.83 per share, compared with a loss of $132 million, or $1.25 a share, in the same period last year. Adjusted loss per share stood at $1.46, versus a loss of $1.06, a year earlier. Revenue fell to $8.87 billion from $9.47 billion, in the year-ago period. Analysts had expected Sears to report a loss of $1.10 a share on sales of $9.01 billion. The retailer said Kmart comparable-store sales dropped 2.1 percent during the period, while Sears Domestic declined 0.8 percent and Sears Canada slid 2.5 percent.
The Hain Celestial Group, Inc. (NASDAQ:HAIN)
The organic products company reported fourth-quarter adjusted earnings of 65 cents per share on revenue of $463.5 million, compared to Street expectations for earnings of 62 cents per share on sales of $454.7 million. For fiscal 2014, Hain Celestial expects earnings of $2.95 to $3.05 per share on revenue of $2.03 billion to $2.05 billion. Shares closed Wednesday at $72.90, and rallied in early-hours trading.
Williams Companies, Inc. (NYSE:WMB)
Williams Companies, Inc. (NYSE:WMB) raised its third quarter dividend by 17.2 percent from the year-ago amount. Shareholders of record September 13 will be paid a dividend of $0.3663 per share on September 30. The energy infrastructure company also reaffirmed its full-year guidance for 20 percent dividend growth, sending shares higher in recent trading.
Economic Calendar for Thursday, August 22, 2013:
08:30 A.M. ET: Initial Jobless Claims
08:30 A.M. ET: Continuing Jobless Claims
08:58 A.M. ET: Markit Manufacturing PMI (August)
09:00 A.M. ET: FHFA Housing Price Index (MoM) (July)
10:00 A.M. ET: CB Leading Indicator (MoM) (July)
10:30 A.M. ET: EIA Natural Gas Storage change (August 16)
11:00 A.M. ET: Kansas Fed manufacturing activity (August)
01:00 P.M. ET: 5-Year TIPS Auction
02:00 P.M. ET: Dallas Federal Reserve Bank President Richard Fisher speaks.
04:30 A.M. ET: Fed Balance Sheet
04:30 A.M. ET: Money Supply
