Morning Market Update
Stocks that are expected to trade actively in U.S. markets on Wednesday include: Apple Inc. (NASDAQ:AAPL), Zynga Inc (NASDAQ:ZNGA), Macy's, Inc. (NYSE:M), Steinway Musical Instruments Inc (NYSE:LVB), Deere & Company (NYSE:DE), Cree, Inc. (NASDAQ:CREE), AMR Corporation (OTCMKTS:AAMRQ), US Airways Group Inc (NYSE:LCC), Brocade Communications Systems, Inc. (NASDAQ:BRCD), SeaWorld Entertainment Inc (NYSE:SEAS), Towers Watson & Co (NYSE:TW).
US: Dow Futures: 15391.00 (-0.13%), S&P 500 Futures: 1686.60 (-0.25%), NASDAQ Futures: 3135.25 (-0.06%)
Europe: CAC: 4106.84 (0.35%), DAX: 8421.54 (0.01%), FTSE: 6606.63 (-0.08%)
Asia-Pacific: Australia: 5157.40 (-0.01%), China: 2100.14 (-0.29%), Hong Kong: 22541.13 (0.00%), Japan: 14050.16 (1.30%).
Metals: Gold: 1322.40 (0.14%), Silver: 21.52 (0.85%), Copper: 3.32 (0.23%)
Energy: Crude Oil: 106.26 (-0.53%), Natural Gas: 3.32 (0.97%)
Commodities: Corn: 4.48 (0.17%), Soya Bean: 12.20 (-0.57%), Wheat: 6.39 (-0.27%)
Currency: EUR/USD: 1.3258 (-0.04%), GBP/USD: 1.5518 (0.45%), USD/JPY: 98.1200 (-0.08%)
10-year US Treasury: 2.706% (0.060)
Market and Economic News Update:
U.S. stock-index futures decline: U.S. stock-index futures are pointing to a lower open on Wednesday, ahead of a speech from St. Louis Federal Reserve President James Bullard. On the economic front, U.S. core producer price index, which strips out energy and food, rose 0.1 percent in July, less than the 0.2 percent increase projected by analysts. Dow component Cisco Systems, Inc. (NASDAQ:CSCO) will report quarterly results after the close of trading.
European markets off session’s lows: European markets are off the lows of the day after euro zone GDP data beat analysts’ expectations, but gains were capped as U.K. stocks reacted negatively to the release of the latest Bank of England minutes. The CAC 40 (INDEXEURO:PX1) added 0.4 percent to 4106.84, while the DAX (INDEXDB:DAX) was flat at 8421.54. The FTSE 100 (INDEXFTSE:UKX) edged 0.1 percent lower to 6606.63 points. The euro zone blue-chip ESTX 50 PR.EUR (INDEXSTOXX:SX5E) (Euro Stoxx 50) was up 0.2 percent in recent trading.
Asian stocks end mixed: Asian markets struggled for direction in a thin session of trade. The NIKKEI 225 (INDEXNIKKEI:NI225) closed above the 14,000 mark as the dollar-yen traded at a one-week high. The SSE Composite Index (SHA:000001) (Shanghai Composite Index) gave up gains made earlier in the session to end a four-day winning streak. The S&P/ASX 200 (INDEXASX:XJO) index finished largely unchanged in trade today.
Stocks in News:
Apple Inc. (NASDAQ:AAPL)
Apple Inc. (NASDAQ:AAPL) continues to edge higher in recent trading after Carl Icahn revealed a large stake in the company. Icahn, who is locked in a fierce battle over computer maker Dell, announced his move yesterday on Twitter. Icahn called the tech giant “extremely undervalued,” and said the stock could be worth as much as $700 if CEO Tim Cook pushed to increase its stock buyback.
Zynga Inc (NASDAQ:ZNGA)
The social game maker announced the departure of several senior executives, including Chief Operating Officer David Ko, Chief Technology Officer Cadir Lee and Chief People Officer Colleen McCreary, as part of a management shake-up under new CEO Don Mattrick. A former Microsoft Corporation (NASDAQ:MSFT) executive, Mattrick was named Zynga CEO on July 3 and tasked with turning around the struggling company. Shares edged higher in pre-market trading.
Macy's, Inc. (NYSE:M)
Macy’s, Inc. (NYSE:M) said second-quarter profit rose to $281 million, or 72 cents a share, from $279 million, or 67 cents, in the same period last year. Sales edged 1 percent lower to $6.07 billion, while comparable sales declined 0.8 percent. The company cut its full-year profit outlook to $3.80 to $3.90 from an earlier range of as much as $3.95 a share. Analysts were looking for second quarter profit of 78 cents a share and $3.95 a share for the year.
Steinway Musical Instruments Inc (NYSE:LVB)
Investment firm Paulson & Co., run by hedge-fund manager John Paulson, agreed to buy Steinway Musical Instruments Inc (NYSE:LVB) for about $503 million. Paulson will pay $40 in cash for each Steinway share, in a deal to take the piano maker private. The deal is expected to close in next month.
Deere & Company (NYSE:DE)
Deere & Company (NYSE:DE)’s third-quarter profit rose to $997 million, or $2.56 a share, from $788 million, or $1.98 a share, in the year-ago period. Revenue increased to $10.0 billion, from $9.6 billion a year earlier. Analysts had expected the farming-equipment manufacturer to report earnings of $2.17 a share on sales of $9.18 billion. Additionally, the company raised its full-year profit forecast to $3.45 billion. Shares in Deere were up 3 percent in premarket trading.
Cree, Inc. (NASDAQ:CREE)
Cree, Inc. (NASDAQ:CREE) reported fourth quarter earnings of 38 cents a share, excluding one-time items, in line with expectations, while revenue came in at $375 million versus estimates of $377 million. In addition, the semiconductor materials manufacturer provided current-quarter outlook that missed some analysts’ projections. Shares tumbled in pre-open session.
AMR Corporation (OTCMKTS:AAMRQ), US Airways Group Inc (NYSE:LCC)
Shares of American Airlines' parent company, AMR Corporation (OTCMKTS:AAMRQ), and US Airways Group Inc (NYSE:LCC) will continue to be in focus after the U.S. government sued to block the proposed $11 billion airline merger, saying consumers would end up paying higher fares. The Justice Department filed an antitrust lawsuit with five states, challenging the merger to create the world’s biggest airlines.
Brocade Communications Systems, Inc. (NASDAQ:BRCD)
Brocade Communications Systems, Inc. (NASDAQ:BRCD) posted third quarter earnings of 19 cents a share, excluding one-time items, on sales of $537 million, edging past Wall Street expectations for 12 cents a share on revenue of $519 million. The network equipment maker expects revenue from its storage area networking business to rise up to 4 percent in the current quarter compared to the third quarter. Shares surged in recent pre-market trading.
SeaWorld Entertainment Inc (NYSE:SEAS)
The theme park operator reported second quarter earnings excluding one-time items of 41 cents a share, on revenue of $411 million, trailing Street expectations for earnings of 51 cents a share on sales of $434 million. In addition, the company cut its full-year revenue outlook, sending shares sharply lower in early-hours trading.
Towers Watson & Co (NYSE:TW)
Towers Watson & Co (NYSE:TW) said fiscal fourth-quarter earnings jumped 27 percent as margins improved despite weaker revenue from financial-services. Excluding items, adjusted per-share earnings were $1.36. Revenue increased 6 percent to $875.3 million. For the current quarter, the professional-services company forecast adjusted earnings of $1.15 to $1.20 a share on revenue of between $850 million and $870 million. Class A shares closed Tuesday at $87.07 and were inactive in pre-market trading.
Economic Calendar for Wednesday, August 14, 2013:
07:00 A.M. ET: MBA Mortgage Applications (August 9)
08:30 A.M. ET: Producer Price Index (YoY) (July)
08:30 A.M. ET: Producer Price Index ex-Food & Energy (YoY) (July)
10:00 A.M. ET: Atlanta Fed Business Inflation Expectations (August)
10:30 A.M. ET: EIA Crude Oil Stocks change (August 9)
01:20 P.M. ET: St. Louis Federal Reserve Bank President James Bullard speaks.
03:15 P.M. ET: St. Louis Federal Reserve Bank President James Bullard speaks.