Morning Market Update
Every morning we put out a report with the latest news on global stock markets, company news, and global economic news. Major headlines for Thursday September 13th below:
Here’s a round up of hedge funds’ May returns
Tyro Absolute Return Fund was down 1.5% for May. The fund's main contributors in May were Super Micro Computer, which gained 1.6%, Shyft Group, which was up 1%, and GCI Liberty, which gained 1%. Detractors in May include Recro Pharma, which fell 2.6%, index shorts and hedges, which declined 2%, and DXC Technology, which was Read More
- US: Dow Futures: 13340.00 (-0.16%), S&P 500 Futures: 1436.80 (-0.19%), NASDAQ Futures: 2790.50 (-0.21%)
- Europe: CAC: 3515.85 (-0.79%), DAX: 7321.69 (-0.30%), FTSE: 5793.75 (0.20%).
- Asia-Pacific: Australia: 4339.40 (-0.50%), China: 2110.38 (-0.77%), Hong Kong: 20047.63 (-0.14%), India: 5435.35 (0.08%), Japan: 8995.15 (0.39%).
- Metals: Gold: 1736.70 (0.17%), Silver: 33.30 (0.02%), Copper: 3.69 (-0.12%)
- Energy: Crude Oil: 97.36 (0.36%), Natural Gas: 3.04 (-0.69%)
- Commodities: Corn: 7.71 (-1.06%), Soya Bean: 17.43 (2.76%), Wheat: 8.94 (0.74%)
- Currency: EUR/USD: 1.2899 (-0.01%), GBP/USD: 1.6101 (-0.04%), USD/JPY: 77.5200 (-0.42%)
- 10 year US Treasury: 1.819% (-0.012)
Financial and Economic News Update
U.S. stock-index futures in the red: U.S. stock-index futures are pointing to a lower open on Thursday ahead of the Federal Reserve’s latest monetary policy meeting. The Federal Open Market Committee will release its policy statement at 12:30 P.M. ET. Fed chairman Ben Bernanke will hold a press conference at 2:15 P.M. On the economic front, jobless claims rose 15,000 to a seasonally adjusted 382,000, the highest in two months, according to the Labor Department. Economists had forecast claims rising to 370,000 last week. The producer price index increased 1.7 percent in August, the biggest gain in three years, as gas prices soared, according to the Labor Department. Economists were expecting an increase of 1.1 percent. Food prices rose 0.9 percent, while wholesale prices excluding food and energy costs gained 0.2 percent. The Dow Jones industrial average, the S&P 500 and the NASDAQ were all trading marginally in the red.
European markets trading mostly lower: European markets are down in trade today with the German DAX (INDEXDB:DAX) trading 0.3 percent lower at 7321.69, the FTSE 100 (INDEXFTSE:UKX) was up 0.2 percent at 5793.75 and the CAC 40 (INDEXEURO:PX1) slid 0.8 percent to 3515.85. The euro zone blue-chip ESTX 50 PR.EUR (INDEXSTOXX:SX5E) (Euro Stoxx 50) was trading 0.7 percent lower.
Asian markets end mixed: Asian markets closed mixed on Thursday, with Japan’s NIKKEI 225 (INDEXNIKKEI:NI225) closing 0.4 percent higher at 8995.15 points. The HANG SENG INDEX (INDEXHANGSENG:HSI) ended a choppy session down 0.1 percent at 20,047.6, while the SSE Composite Index (SHA:000001) (Shanghai Composite Index) shed 0.8 percent amid low volumes. The S&P/ASX 200 (INDEXASX:XJO) index fell 22 points to 4,339.4. The benchmark Indian 30-share BSE SENSITIVE (INDEXBOM:SENSEX) index ended up 0.1 percent.
Company News Update
- Goldman Sachs has raised its price target on Apple Inc. (NASDAQ:AAPL) to $810 from $790, and maintained its “Conviction Buy” rating, following the release of its sixth generation smartphone, the iPhone 5.
- Home-furnishings retailer Pier 1 Imports, Inc. (NYSE:PIR) reported second quarter earnings excluding items of 19 cents a share, in line with analysts’ estimates. Revenue increased 8.3 percent to $367.6 million, compared to analysts’ expectations of $367.2 million. The company also raised its full-year adjusted profit forecast.
- Ford Motor Company (NYSE:F), whose chief executive Alan Mulally is expected to step down next year, will discuss a succession plan at its board meeting today.
- AT&T Inc. (NYSE:T) said its wireless division has reached a tentative labor agreement with the Communications Workers of America, which provides for benefits including health care.
- Activist investor Ralph Whitworth, whose Relational Investors LLC holds a 3.8 percent stake in Abercrombie & Fitch Co. (NYSE:ANF), has asked the teen retailer to cut spending to match its peers and open international stores, according to a Bloomberg report. Separately, Citigroup initiated coverage of the stock with a “sell” rating.
- Genesee & Wyoming Inc. (NYSE:GWR) said it will sell more than 3 million shares of stock and 2 million tangible equity units to fund its purchase of RailAmerica, Inc. (NYSE:RA).
- Filtration products maker Pall Corporation (NYSE:PLL) said fourth quarter profit fell 11.5 percent to $86.2 million or 73 cents per share, from $97.4 million or 82 cents per share for the year-ago quarter. Sales for the quarter grew 0.4 percent to $783.7 million from $780.4 million a year earlier.
- The board of independent petroleum refiner, HollyFrontier Corp (NYSE:HFC) has declared a special dividend of 50 cents a share.
- Canadian satellite technology company MacDonald Dettwiler & Associates Ltd (TSE:MDA) has received a request for additional information from the U.S. Department of Justice in connection with its proposed $875-million deal to buy Loral Space & Communications Ltd. (NASDAQ:LORL), Reuters reported.
- Education services provider K12 Inc. (NYSE:LRN) reported a better than expected fourth quarter earnings per share of 5 cents, on revenue of $170.4 million that also beat estimates.
- Hollywood special-effects company Digital Domain Media Group Inc, which filed for bankruptcy on Tuesday, has received approval from a U.S. bankruptcy judge for a snap auction.
- Chipmakers Intel Corporation (NASDAQ:INTC) and Advanced Micro Devices, Inc. (NYSE:AMD) have been downgraded to “neutral” from “buy” by analysts at Citigroup.
- Athletic footwear and apparel maker NIKE, Inc. (NYSE:NKE) fell 1.8 percent in early morning trade after Citigroup lowered the stock to “neutral” from “buy.”
- Darden Restaurants, Inc. (NYSE:DRI), which controls the Olive Garden and Red Lobster chains, was cut to “neutral” from “outperform” at Robert W Baird.
- British bank Standard Chartered PLC (LON:STAN) (HKG:2888), under investigation for alleged violations of sanctions against Iran, is close to settling with the US Treasury after the New York Times reported that lawyers within the Treasury Department have recommended a preliminary settlement.
- British defense contractor BAE Systems plc (LON:BA) is down 7 percent and Airbus-owner EADS NV (EPA:EAD) slumped 8 percent, after the two companies confirmed on Wednesday that they are in advanced merger talks
- French drug maker Sanofi SA (ADR) (NYSE:SNY) (EPA:SAN) has received approval from the U.S. Food and Drug Administration to market a new once-a-day multiple sclerosis pill Aubagio.
- Barclays PLC (ADR) (NYSE:BCS) (LON:BARC) has sold a 60 percent stake in University Partnerships Programme, the UK’s largest developer of university campuses, to Dutch pension fund manager PGGM NV, in a deal valued at 840 million pounds ($1.4 billion).
- UK-based fashion chain Next plc (LON:NXT) is down 6 percent after reporting poor sales for August and the beginning of September, despite a rise in first half profit and revenue.
- Imagination Technologies Group plc (LON:IMG), a British-based maker of a mobile graphics and microprocessor chip technology, dropped 5 percent after saying first-quarter royalty revenue growth was in line with expectations. Separately, analysts at Numis Securities have downgraded the stock to “hold” from “buy”, with a price forecast of 590 pence per share.
- French construction company Vinci SA (EPA:DG) declined 2.6 percent, after Bank of America Merrill Lynch downgraded the stock to “neutral” from “buy.”
- WPP PLC (ADR) (NASDAQ:WPPGY) (LON:WPP), the world’s biggest advertising agency, added 0.6 percent in London trading after the stock was raised to “hold” from “underperform” at Jefferies Group Inc.
- China Mobile Ltd. (ADR) (NYSE:CHL) (HKG:0941), the mainland’s biggest mobile operator, slumped 1.4 percent in Hong Kong after Apple Inc. (NASDAQ:AAPL)’s announcement on Thursday that it’s new thinner and lighter iPhone 5 will go on sale from Friday. China Mobile does not carry iPhones on its networks.
- Australian iron-ore producer Fortescue Metals Group Limited (ASX:FMG) plunged 14 percent after the Australian Financial Review reported the company had asked its lenders to waive debt covenants for a year due to volatility in the iron ore market.
- Hong Kong real estate developer Sun Hung Kai Properties Limited (HKG:0016), whose co-chairmen face charges in an alleged bribery case, posted full year profit that narrowly beat market expectations. The stock closed 0.6 percent higher.
- Australia’s largest department store chain Myer Holdings Ltd (ASX:MYR) reported full-year net profit of 139.4 million Australian dollars ($145.9 million) that was slightly ahead of the average analysts’ estimate of 138.8 million Australian dollars. Sales declined 1.3 percent to 3.12 billion Australian dollars, from previous year’s 3.16 billion Australian dollars. The company also declared a final dividend of 9 Australian cents per share.
- Japanese utility Kansai Electric Power Co Inc (TYO:9503) is planning to apply for government approval to raise household power rates by about 10 percent from April next year, according to a Yomiuri newspaper report.
- Diversified miner Rio Tinto plc (ADR) (NYSE:RIO) (LON:RIO) (ASX:RIO) forecast a rise in prices for diamonds over the next decade amid growing demand from China and India. The world’s third-largest producer of rough diamonds said lack of major new discoveries should also keep prices firm.
- Nintendo Co., Ltd (TYO:7974) will sell its latest game console, the Wii U, in Japan from December 8 for 25,000 yen ($320), as the creator of Super Mario tries to recover from its first annual loss.
- AU Optronics Corp. (ADR) (NYSE:AUO) (TPE:2409), Taiwan’s second-largest maker of liquid-crystal displays, ended 4.4 percent lower after the U.S. government asked a federal court to impose a fine of $1 billion on the company for price fixing.
Economic Calendar for Thursday, September 13, 2012:
08:30 A.M. ET: Initial Jobless Claims (Week ending Saturday, September 08, 2012)
08:30 A.M. ET: Continuing Jobless Claims (Week ending Saturday, September 01)
08:30 A.M. ET: Producer Price Index (MoM) (August)
08:30 A.M. ET: Producer Price Index (YoY) (August)
08:30 A.M. ET: Producer Price Index ex Food & Energy (MoM) (August)
08:30 A.M. ET: Producer Price Index ex Food & Energy (YoY) (August)
09:45 A.M. ET: Bloomberg Consumer Comfort Index (Week ending Sunday, Sept. 09)
10:30 A.M. ET: EIA Natural Gas Report (Week ending Friday, September 07)
12:30 P.M. ET: FOMC Meeting Announcement
02:00 P.M. ET: FOMC Economic Projections
02:00 P.M. ET: Treasury Budget
02:15 P.M. ET: Fed’s Monetary Policy Statement and press conference
04:30 P.M. ET: Fed Balance Sheet
04:30 P.M. ET: Money Supply