Morning Market Update
DG Value Surges On Recovery Plays
According to a copy of the firm's February investor update, Dov Gertzulin's DG Value Partners returned +4.48% net for the month of February, which ValueWalk has been able to review. Q4 2020 hedge fund letters, conferences and more Following this performance, the firm has returned +8.32% net for the year to the end of February. Read More
* US: Dow Futures: 12816.00 (-0.40%), S&P 500 Futures: 1365.10 (-0.21%), NASDAQ Futures: 2634.50 (-0.27%)
* Europe: CAC: 3240.65 (-0.84%), DAX: 6534.96 (-0.46%), FTSE: 5692.99 (0.15%).
* Asia-Pacific: Australia: 4169.20 (-0.07%), China: 2201.35 (-1.18%), Hong Kong: 19809.13 (0.50%), India: 5327.20 (0.47%), Japan: 9079.80 (-0.27%).
* Metals: Gold: 1598.80 (-1.42%), Silver: 27.56 (-2.55%), Copper: 3.48 (-1.61%)
* Energy: Crude Oil: 86.79 (-0.99%), Natural Gas: 2.92 (0.72%)
* Commodities: Corn: 6.73 (2.67%), Soya Bean: 14.72 (2.47%), Wheat: 8.14 (2.91%)
* Currency: EUR/USD: 1.2385 (-1.14%), GBP/USD: 1.5519 (-0.46%), USD/JPY: 80.0800 (0.25%)
* 10 year US Treasury: 1.614% (-0.015)
Financial and Economic News Update
U.S. stock-index futures trading lower: U.S. stock index futures are pointing to a marginally lower on Thursday, as negative comments from European Central Bank President Mario Draghi overshadowed encouraging readings from the U.S. labor market. Weekly jobless claims declined 14,000 to a seasonally adjusted 374,000, according to the Labor Department, that beat economists’ expectations of a fall in claims to 385,000. Separately, the ADP National Employment Report showed that private employers added 176,000 jobs in June. The Dow futures, the S&P futures and the NASDAQ future are all trading mildly in the red.
European markets mostly lower: European markets are trading mostly lower, with the German DAX (INDEXDB:DAX) trading down 0.5 percent at 6534.96, the FTSE 100 (INDEXFTSE:UKX) up 0.2 percent at 5692.99, and the CAC 40 (INDEXEURO:PX1) fell 0.8 percent to 3240.65. The euro zone blue-chip ESTX 50 PR.EUR (INDEXSTOXX:SX5E) (Euro Stoxx 50) was down 0.8 percent.
Asian markets end flat: Asian markets closed largely unchanged on Thursday ahead of the European Central Bank’s policy decision. Japan’s NIKKEI 225 (INDEXNIKKEI:NI225) fell 0.3 percent to 9,079.80. The HANG SENG INDEX (INDEXHANGSENG:HSI) closed up 0.5 percent at 19,809.1, while the SSE Composite Index (SHA:000001) (Shanghai Composite Index) was the worst performer in the region, closing 1.2 percent lower at 2,201.4 points. The S&P/ASX 200 (INDEXASX:XJO) index fell 2.96 points to 4,169.2. The benchmark Indian 30-share BSE SENSITIVE (INDEXBOM:SENSEX) index rose 0.39 percent to finish at 17,530.30 points.
Stocks in Focus
* A London court has ruled that Taiwanese smartphone maker HTC Corp (TPE:2498)’s devices do not infringe Apple Inc. (NASDAQ:AAPL) patents.
* Specialty retailer Limited Brands, Inc. (NYSE:LTD) saw same-store sales rise 7 percent in June, topping analysts’ estimates of a 2.4 percent gain.
* Warehouse retailer Costco Wholesale Corporation (NASDAQ:COST) reported same-store sales increase of 3 percent for June, trailing analysts’ estimates of a 3.7 percent rise.
* Australian budget carrier Virgin Australia Holdings Ltd (ASX:VAH) has inked a $2.19 billion deal with The Boeing Company (NYSE:BA) for the delivery of 23 737 MAX aircrafts over the next ten years.
* Private equity firm Carlyle Group LP (NASDAQ:CG) has acquired a 49 percent stake in China’s Mandarin Hotel Holdings for an undisclosed sum, making it the hotel operator’s biggest shareholder.
* Electronics retailer Best Buy Co., Inc. (NYSE:BBY) has opened a test store near its headquarters in Minnesota, whose designs are heavily borrowed from the look of Apple Inc. (NASDAQ:AAPL)’s retail outlets, The Wall Street Journal reported.
* Racetrack operator International Speedway Corporation (NASDAQ:ISCA) posted second quarter adjusted earnings of 52 cents per share, on revenue of $179.6 million that easily beat analysts’ estimate of earnings of 40 cents per share on revenue of $158.65 million.
* Auto retailer AutoNation, Inc. (NYSE:AN) said retail new vehicle sales jumped 38 percent in June, compared to the same month last year.
* U.S. auto parts supplier Visteon Corporation (NYSE:VC) will offer some $805 million to buy the remaining 30 percent of South Korean car air conditioner maker Halla Climate Control that it does not already own.
* Digital media provider RealNetworks Inc (NASDAQ:RNWK) said President and Chief Executive Officer, Thomas Nielsen, has resigned.
* Chip maker Standard Microsystems Corporation (NASDAQ:SMSC) swung to a fiscal first-quarter loss of $17.2 million or 76 cents per share, hit by one-time charges related to stock-compensation expenses.
* Movie theater chain Regal Entertainment Group (NYSE:RGC) has seen its earnings per share estimate slashed by analysts at Wedbush.
* British insurer Aviva Plc (ADR) (NYSE:AV) (LON:AV) is planning to sell or close 16 non-core underperforming businesses as part of a radical overhaul aimed at bolstering its capital reserves and improving its financial performance.
* Standard & Poor’s and Moody’s Investors Service have lowered their outlook of the scandal-hit Barclays PLC (ADR) (NYSE:BCS) (LON:BARC) to negative from stable, amid the resignations of its top three executives.
* Spanish lenders Banco Santander, S.A. (ADR) (NYSE:SAN) and Banco Bilbao Vizcaya Argentaria SA (ADR) (NYSE:BBVA) were down more than a percent each on speculation that the bailout of the country’s banks could be delayed.
* Exxon Mobil Corporation (NYSE:XOM) is considering a sale of its Esso gas station chain, which includes more than 1,100 gas stations in Germany, Bloomberg reported.
* Volkswagen AG (ETR:VOW) has agreed to acquire the remaining 50 per cent stake in sports car maker Porsche Automobil Holding SE (ETR:PAH3) it doesn’t already own, for 4.46 billon euros ($5.9 billion) in cash, plus one common share.
* British engineering group GKN plc (LON:GKN) will buy AB Volvo (ADR) (PINK:VOLVY)’s aerospace division for 633 million pounds ($986 million) in cash.
* Mining group Xstrata PLC (LON:XTA) has adjourned a shareholder meeting scheduled to approve its merger with Glencore International Plc (LON:GLEN).
* British utility Centrica PLC (LON:CAN) slumped 1.3 percent in London trading after Goldman Sachs lowered the stock to “neutral” from “conviction buy,” citing a weaker than expected earnings outlook. London-listed Russian steelmaker Evraz plc (LON:EVR) was downgraded to “neutral” from “buy” at UBS AG. Recruitment services company Michael Page International plc (LON:MPI) declined 4.7 percent after analysts at Bank of America Corp. reduced its earnings-per-share estimate.
* South Korean technology giant Samsung Electronics has displaced Japanese rival Sony Corporation (ADR) (NYSE:SNE) (TYO:6758) as the most valued brand by consumers in Asia, according to a survey by research firm Nielsen and media magazine Campaign Asia-Pacific. Apple Inc. (NASDAQ:AAPL), Nestle and Panasonic Corporation (ADR) (NYSE:PC) (TYO:6752) also made it to the top five list.
* Australian mining magnate Gina Rinehart has reduced her stake in Fairfax Media Limited (ASX:FXJ), publisher of the Sydney Morning Herald and The Age, from 18.7 per cent to about 15 percent, after failing to win seats on the company’s board.
* Chinese sports-apparel company Li Ning Co. Ltd. (HKG:2331) ended 7 percent higher in Hong Kong trading after the company said chief executive officer Zhang Zhiyong had stepped down with immediate effect.
* Japanese industrial powerhouse Sumitomo Corp (TYO:8053) has acquired a 50 percent stake in the Isaac Plains coal mine, in Queensland, Australia, from Aquila Resources Limited (ASX:AQA) for 442 million Australian dollars.
* Chinese computer maker Lenovo Group Limited (HKG:0992) and Japan’s NEC Corp (TYO:6701) are planning to jointly develop tablet computers, according to a report in The Nikkei business daily.
* Japanese camera maker Nikon Corporation (TYO:7731) ended 1.4 percent higher in Tokyo, after Daiwa Securities lifted its rating to “outperform” from “neutral”, citing better than expected sales of SLR digital cameras.
* Embattled Australian carrier, Qantas Airways Limited (ASX:QAN), is in talks with Doha-based Qatar Airways to form a code share agreement on its Melbourne and Perth routes.
* The Japan Fair Trade Commission has approved the proposed merger of the Tokyo Stock Exchange and Osaka Securities Exchange, which, once completed, will create Asia’s biggest stock exchange, and the world’s third-largest.
Economic Calendar for Thursday, July 05, 2012:
07:00 A.M. ET: MBA Purchase Applications (Week ending Friday, June 29, 2012)
07:30 A.M. ET: Challenger Job-Cut Report (June)
08:15 A.M. ET: ADP Employment Change (June)
08:30 A.M. ET: Initial Jobless Claims (Week ending Saturday, June 30, 2012)
08:30 A.M. ET: Continuing Jobless Claims (Week ending Saturday, June 23, 2012)
09:45 A.M. ET: Bloomberg Consumer Comfort Index (Week ending Sunday, July 01)
10:00 A.M. ET: ISM Non-Manufacturing Index (June)
10:30 A.M. ET: EIA Natural Gas Report (Week ending Friday, June 29, 2012)
11:00 A.M. ET: EIA Petroleum Status Report (Week ending Friday, June 29, 2012)
04:30 P.M. ET: Fed Balance Sheet
04:30 P.M. ET: Money Supply