Morning Market Update
2020 Letter: Kerrisdale Outlines Long Thesis For This ESG Tech Stock
Sahm Adrangi's Kerrisdale Capital was up 6.5% for the fourth quarter, including a decline of 0.3% in October and gains of 3.2% and 3.5% for November and December, respectively. For comparison, the S&P 500 gained 12.2% during the fourth quarter, while the Barclay Hedge Fund Index was up 9.3%. Q4 2020 hedge fund letters, conferences Read More
* US: Dow Futures: 12473.00 (-0.87%), S&P 500 Futures: 1321.90 (-0.86%), NASDAQ Futures: 2537.50 (-0.86%)
* Europe: CAC: 3030.06 (-1.80%), DAX: 6313.54 (-1.32%), FTSE: 5303.65 (-1.65%).
* Asia-Pacific: Australia: 4094.20 (-0.49%), China: 2384.67 (-0.21%), Hong Kong: 18690.22 (-1.95%), India: 4950.75 (-0.79%), Japan: 8633.19 (-0.28%).
* Metals: Gold: 1548.10 (-0.04%), Silver: 27.66 (-0.49%), Copper: 3.41 (-1.62%)
* Energy: Crude Oil: 89.37 (-1.53%), Natural Gas: 2.42 (-2.62%)
* Commodities: Corn: 5.63 (-2.94%), Soya Bean: 12.94 (0.27%), Wheat: 6.52 (-2.70%)
* Currency: EUR/USD: 1.2428 (-0.60%), GBP/USD: 1.5569 (-0.46%), USD/JPY: 79.1000 (-0.49%)
* 10 year US Treasury: 1.666% (-0.082)
Financial and Economic News Update
U.S. stock-index futures decline: U.S. stock index futures are pointing to a lower open on Wednesday on investor concerns about the troubled Spanish banking system. The Dow Jones industrial average, the S&P 500 and the NASDAQ futures were all trading close to a percent lower.
European markets in the red: European markets are down in trade today, with the German DAX (INDEXDB:DAX) trading 1.3 percent lower at 6313.54, the FTSE 100 (INDEXFTSE:UKX) down 1.7 percent at 5303.65, and the CAC 40 (INDEXEURO:PX1) losing 1.8 percent to 3030.06. The euro zone blue-chip ESTX 50 PR.EUR (INDEXSTOXX:SX5E) (Euro Stoxx 50) was trading 1.4 percent lower.
Asian markets end lower: Asian markets closed lower on Wednesday, with Japan’s NIKKEI 225 (INDEXNIKKEI:NI225) snapped a four-day winning streak, to close 0.3 percent lower at 8633.19. The HANG SENG INDEX (INDEXHANGSENG:HSI) closed down 1.92 percent at 18,690.22, while the SSE Composite Index (SHA:000001) (Shanghai Composite Index) was down 0.2 percent at 2,384.7 points. The S&P/ASX 200 (INDEXASX:XJO) index declined 0.5 percent to end at 4,094.2. The benchmark Indian 30-share BSE SENSITIVE (INDEXBOM:SENSEX) index fell 0.86 percent at 16,297.94 points.
Company News Update
* Upscale grocer The Fresh Market Inc (NASDAQ:TFM) reported first quarter profit of 40 cents a share, on revenue of $324.8 million, that both topped analysts’ estimates. Same-store sales jumped 8.2 percent compared to the same quarter last year.
* Daily deals provider Groupon Inc (NASDAQ:GRPN) will acquire Breadcrumb, the New York-based maker of point-of-sale software for the hospitality industry, for an undisclosed amount.
* Auto-parts chain The Pep Boys-Manny, Moe & Jack (NYSE:PBY) said that its planned $791 million acquisition by private-equity firm Gores Group has been called-off, after the private equity firm voiced concerns about the company’s worsening financial situation. Pep Boys will receive about $50 million in termination fees.
* Enterprise software company salesforce.com, inc. (NYSE:CRM) is close to acquiring New York-based social media marketing company Buddy Media for more than $800 million, according to media reports.
* Footwear retailer Finish Line Inc (NASDAQ:FINL) has raised its current quarter profit forecast due to better than expected sales, and said that it is now expecting earnings of 22 cents to 23 cents a share, up from the roughly 21 cents previously predicted. Analysts are looking for fiscal first quarter earnings of 22 cents a share.
* Student lender SLM Corp (NASDAQ:SLM) said it was boosting its share buy-back program by $400 million. The company had authorized a $500 million share repurchase program in January 2012.
* Linkedin Corporation (NYSE:LNKD) has been upgraded to “buy” from “neutral at Citigroup with a price target of $125. The stock gained 1.5 percent in early morning trade.
* Hotel and casino operator Wynn Resorts, Limited (NASDAQ:WYNN)was upgraded to “buy” from “neutral” at Goldman Sachs, with a price target of $136. The stock was trading 2 percent higher in pre-market trading.
* Metro AG (FRA:MEO) has agreed to sell its loss-making Makro U.K. wholesale unit to Booker Group Plc (LON:BOK), U.K’s biggest food wholesaler, for 139.7 million pounds ($219 million) in cash and stock.
* Europe’s second-biggest airline Deutsche Lufthansa AG (FRA:LHA) is planning to cut as many as 1,000 jobs at its in-flight caterer LSG Sky Chefs as part of cost cutting measures.
* UniCredit SpA (BIT:UCG), Italy’s biggest bank, is closing down its cash equity division in Romania and Russia, and scaling down the business in Poland and Turkey, as part of a plan to increase profitability and cut costs, Bloomberg reported.
* Ben Verwaayen, Chief Executive Officer at Alcatel Lucent SA (ADR) (NYSE:ALU), France’s largest phone network equipment maker, said that European telecommunications companies are not adequately investing in mobile-phone and fixed-line networks, which he partly attributed to regulatory decisions unfavorable to the industry.
* French financial newspaper Les Echos reported that Vallourec SA (EPA:VK), a Paris-based steel-pipe maker hasn’t witnessed a rebound in orders.
* Japanese regulators are investigating JP Morgan Chase & Co. (NYSE:JPM) for its alleged role in leaking insider information regarding a planned share offering by Nippon Sheet Glass Company, Limited (TYO:5202) in 2010.
* Scandal-hit Japanese camera and medical equipment manufacturer, Olympus Corp (TYO:7733) will cut around 2,500 jobs, and is in talks to sell an equity stake to either Sony Corporation (ADR) (NYSE:SNE) or Panasonic Corporation (ADR) (NYSE:PC) in a bid to inject capital into the company, local media reported.
* Shanghai-listed construction equipment manufacturer Sany Heavy Industry Co., LTD (SHA:600031) has filed for a $2 billion Hong Kong listing, after postponing a similar plan in September last year.
* Short-selling was restricted in Japanese chip-maker Renesas Electronics Corporation (TYO:6723), after the stock plunged 25 percent over the past two days.
* India’s biggest automaker Tata Motors Limited (ADR) (NYSE:TTM) saw a slew of brokerage downgrades after its Jaguar Land Rover unit posted earnings that missed some analysts’ estimates.
* Malaysian palm oil and rubber producer Felda Global Ventures Holdings Bhd. is planning to raise as much as 10.2 billion ringgit ($3.2 billion) in an initial public offering in Kuala Lumpur, in what will be the second-biggest IPO of the year after Facebook Inc (NASDAQ:FB) raised $16 billion this month.
Economic Calendar for Wednesday, May 30, 2012:
07:00 A.M. ET: MBA Purchase Applications (Week ending Friday, May 25, 2012)
07:30 A.M. ET: Challenger Job-Cut Report (May)
07:45 A.M. ET: ICSC-Goldman Store Sales (Week ending Saturday, May 26, 2012)
08:55 A.M. ET: Redbook (Week ending Friday, May 25, 2012)
10:00 A.M. ET: Pending Home Sales Index (April)
01:00 P.M. ET: New York Federal Reserve Bank President William Dudley speaks.
01:20 P.M. ET: Dallas Federal Reserve Bank President Richard Fisher speaks.
04:30 P.M. ET: Boston Federal Reserve President Eric Rosengren speaks.