Morning Market Update
Apollo Global is no longer the “king of distress”: Josh Harris
Historically, Apollo Global has been known as the king of distressed investments for its track record of taking distressed assets and turning a profit on them. However, the pandemic has changed the firm's approach to the markets, at least temporarily. Q2 2020 hedge fund letters, conferences and more At CNBC's Institutional Investor Delivering Alpha Conference, Read More
* 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