Every morning we puts out a news report with the latest news in global stock markets, company news, and global economic news.
Morning Market Update
ValueWalk's Raul Panganiban with Maurits Pot, Founder and CEO of Dawn Global. Before this he was Partner at Kingsway Capital, a frontier market specialist with over 2 billion AUM. In the interview, we discuss his approach to investing and why investors should look into frontier and emerging markets. Q2 2021 hedge fund letters, conferences and Read More
* US: Dow Futures: 13458.00 (-0.09%), S&P 500 Futures: 1451.60 (-0.17%), NASDAQ Futures: 2843.00 (-0.11%)
* Europe: CAC: 3531.11 (-0.64%), DAX: 7359.05 (-0.61%), FTSE: 5860.55 (-0.56%).
* Asia-Pacific: Australia: 4394.70 (-0.18%), China: 2059.54 (-0.92%), Hong Kong: 20601.93 (-0.27%), India: 5600.05 (-0.18%), Japan: 9123.77 (-0.39%).
* Metals: Gold: 1760.10 (-0.59%), Silver: 34.18 (-0.54%), Copper: 3.75 (-1.02%)
* Energy: Crude Oil: 95.47 (-1.19%), Natural Gas: 2.84 (-0.73%)
* Commodities: Corn: 7.46 (-4.38%), Soya Bean: 16.44 (-3.97%), Wheat: 8.82 (-5.37%)
* Currency: EUR/USD: 1.3053 (-0.49%), GBP/USD: 1.6245 (-0.03%), USD/JPY: 78.6100 (-0.13%)
* 10 year US Treasury: 1.888% (-0.038)
Financial and Economic News Update
U.S. stock-index futures slip: U.S. stock-index futures are pointing to a lower on Tuesday as the sharp rally set-off by the Federal Reserve’s decision to launch another round of quantitative easing, continued to fade. On the economic front, U.S. current account trade deficit narrowed more than expected in the second quarter, helped by an increase in American exports and cheaper oil imports. Current account deficit narrowed to $117.4 billion in the second quarter from a revised $133.6 billion in the first quarter, the Commerce Department said today. Economists had expected the current account gap to shrink to $125.5 billion. The Dow Jones industrial average, the S&P 500 and the NASDAQ were all trading marginally in the red.
European markets in the red: European markets are down in trade today as investors await decision from Spain on whether to ask for help from the European Central Bank’s bond-buying program. The German DAX (INDEXDB:DAX) was trading 0.6 percent lower at 7359.05, the FTSE 100 (INDEXFTSE:UKX) was down 0.6 percent at 5860.55 and the CAC 40 (INDEXEURO:PX1) slid 0.7 percent to 3531.11. The euro zone blue-chip ESTX 50 PR.EUR (INDEXSTOXX:SX5E) (Euro Stoxx 50) was trading 0.9 percent lower.
Asian markets end lower: Asian markets closed lower on Tuesday amid investor concerns about the growth slowdown in China. Japan’s NIKKEI 225 (INDEXNIKKEI:NI225) fell 0.4 percent to 9123.77 points, as trading resumed after Monday’s holiday. The HANG SENG INDEX (INDEXHANGSENG:HIS) closed down 0.3 percent at 20,601.9, while the SSE Composite Index (SHA:000001) (Shanghai Composite Index) shed 0.9 percent. The S&P/ASX 200 (INDEXASX:XJO) index lost 7.4 points to 4,395.1. The benchmark Indian 30-share BSE SENSITIVE (INDEXBOM:SENSEX) index ended down 0.3 percent.
Company News Update
* FedEx Corporation (NYSE:FDX) reported first quarter earnings of $1.45 per share, down from $1.46 a share in the year-ago period. Revenue for the quarter came in at $10.79 billion, up from $10.52 billion a year ago. Analysts were expecting earnings of $1.40 a share on $10.70 billion in revenue. The world’s second-largest package delivery company forecast current quarter and full-year earnings that trailed estimates.
* Bank of America/Merrill Lynch raised its price target on Apple Inc. (NASDAQ:AAPL) to $850 from $770. Apple Inc. (NASDAQ:AAPL) crossed above $700 a share for the first time ever in after-hours trading Monday.
* Microsoft Corporation (NASDAQ:MSFT) has warned that a newly discovered bug in its Internet Explorer web browser makes PCs vulnerable to hackers and urged customers to install a free piece of security software to mitigate the risk of infection.
* Google Inc (NASDAQ:GOOG)’s Motorola Mobility unveiled its first smart phone with an Atom processor from Intel Corporation (NASDAQ:INTC) at an event in London on Tuesday.
* Dole Food Company, Inc. (NYSE:DOLE) has struck a deal to sell its packaged foods and Asian fresh fruit businesses to Japanese trading house Itochu Corp (TYO:8001) for about $1.69 billion in cash.
* Office furniture maker HNI Corp (NYSE:HNI) cut its third-quarter revenue and adjusted profit outlook, citing weaker than expected demand. Adjusted earnings for the quarter should come in at about 55 cents per share, down from its previous forecast of between 65 cents to 70 cents per share. The company expects sales to rise 7 to 10 percent compared to an earlier forecast of 11 to 14 percent increase.
* Coal producer Alpha Natural Resources, Inc. (NYSE:ANR) will cut production by 16 million tons and slash 1,200 jobs, or 9 percent of its workforce, as it shifts focus from coal used to generate power to the more lucrative steel-making coal.
* Robotics manufacturer iRobot Corporation (NASDAQ:IRBT) has agreed to pay $74 million to acquire privately held developer of floor cleaning robots, Evolution Robotics Inc.
* Headphone maker Skullcandy Inc (NASDAQ:SKUL) has named Kyle Wescoat as its new chief financial officer.
* RBC Capital Markets has downgraded chipmakers, Analog Devices, Inc. (NASDAQ:ADI), Intel Corporation (NASDAQ:INTC), Nvidia Corporation (NASDAQ:NVDA) and Texas Instruments Incorporated (NASDAQ:TXN) to “sector perform” from “outperform.” Meanwhile, the brokerage raised Broadcom Corporation (NASDAQ:BRCM) to “outperform” from “sector perform” with a target price of $46.
* Analysts at Jefferies have downgraded their rating on aluminum producer, Alcoa Inc. (NYSE:AA) to “hold” from “buy.”
* Bed Bath & Beyond Inc. (NASDAQ:BBBY) was lowered to “perform” from “outperform” by analysts at Oppenheimer with a target price of $80.
* Wells Fargo & Co. raised Jive Software Inc (NASDAQ:JIVE) to “outperform” from “market perform.” The stock was up 3 percent in early morning trade.
* Banking stocks across Europe moved lower as last week’s monetary stimulus rally began to lose steam. HSBC Holdings plc (ADR) (NYSE:HBC) (LON:HSBA) (HKG:0005) fell 1.6 percent, Royal Bank of Scotland Group plc (ADR) (NYSE:RBS) (LON:RBS) dropped 2.4 percent and Barclays PLC (ADR) (NYSE:BCS) (LON:BARC) slid 2.5 percent. In Germany, Commerzbank AG (ETR:CBK) (FRA:CBK) and Deutsche Bank AG (USA) (NYSE:DB) (ETR:DBK) (FRA:DBK) lost more than 4 percent. BNP Paribas SA (EPA:BNP) and Societe Generale SA (EPA:GLE) were also trading significantly lower in Paris.
* Oil stocks are down in trade today as crude oil prices continued to decline. BP plc (ADR) (NYSE:BP) (LON:BP) lost 2.4 percent, BG Group plc (LON:BG) gave up 2.3 percent and Royal Dutch Shell plc (ADR) (NYSE:RDS.A) (LON:RDSA) slipped 1 percent. Norway’s Statoil ASA(ADR) (NYSE:STO) fell 1.2 percent.
* Dutch paints maker Akzo Nobel N.V. (AMS:AKZA) plunged 4.8 percent after announcing that its chief executive Ton Buchner was taking medical leave for a few weeks for fatigue.
* German drug maker Merck KGaA (ETR:MRK) (FRA:MRK) said it has withdrawn its European application for its lung cancer drug Erbitux after regulators asked for more clinical data.
* U.K. retailer Debenhams Plc (LON:DEB) said it would meet forecasts for full-year profit after reporting a 3.7 percent rise in sales at stores open over a year in the 10 weeks to September 1.
* London-listed platinum miner Lonmin Plc (LON:LMI) has offered a one-off bonus of 1,500 rand ($182) to South African workers to end a six-week strike and return to work Wednesday, if they accept a wage hike offer.
* British sportswear retailer JD Sports Fashion PLC (LON:JD) reported an 82 percent drop in first half pre-tax profits due to losses at its newly-acquired Blacks Leisure chain. Separately, JD Sports Fashion has pulled out of the race to buy rival JJB Sports, according to a report in The Financial Times.
* French cosmetics giant L’Oreal (EPA:OR) gained 0.5 percent after analysts at Societe Generale upgraded the stock to “buy” from “hold.”
* Insurance firm Aviva Plc (ADR) (NYSE:AV) (LON:AV) is down 4.5 percent in London trading after Bank of American Merrill Lynch downgraded the stock to “underperform” from “neutral.”
* Japanese auto majors, Toyota Motor Corporation (ADR) (NYSE:TM) (TYO:7203), Nissan Motor Co., Ltd. (TYO:7201) and Honda Motor Co Ltd (ADR) (NYSE:HMC) (TYO:7267) ended significantly lower in Tokyo trading after they reportedly halted some factory operations in China following an escalation in anti-Japan demonstrations.
* Australian iron-ore producer Fortescue Metals Group Limited (ASX:FMG) secured a new $4.5 billion credit facility which it will use to refinance all its existing bank loans and for additional liquidity.
* Chinese property counters rebounded from yesterday’s losses after official data from the National Bureau of Statistics signaled a mild recovery in the property market. Poly Real Estate Group Co., Ltd (SHA:600048), the country’s second-biggest developer, jumped 1.2 percent. In Hong Kong, China Overseas Land & Investments Ltd. (HKG:0688) gained 1 percent, while Evergrande Real Estate Group Limited (HKG:3333) added 0.9 percent.
* Fast Retailing Co Ltd (TYO:9983) plunged 7 percent in Tokyo and was the biggest decliner in the benchmark Nikkei 225 index after it said it would close more of its Uniqlo clothing stores in China due to anti-Japanese protests.
* Hong Kong-based property developer Sino Land Company Limited (HKG:0083) ended 0.4 percent higher after Deutsche Bank named the stock among its top Hong Kong property picks, and said it expects property prices to rise in the near-term due to higher liquidity.
* Mining giant BHP Billiton Limited (ADR) (NYSE:BHP) (ASX:BHP) (LON:BLT) dropped 0.6 percent in Sydney after it said it’ll freeze the base salaries of its senior management team for the current year.
* Hong Kong-based global supply chain manager Li & Fung Limited (HKG:0494) was raised to “overweight” from “underweight” by analysts at HSBC Plc, with a target price of 17 Hong Kong dollars ($2.18). HSBC said that last week’s quantitative easing by the U.S. Federal Reserve should lead to a growth in Li & Fung’s earnings in the coming quarters. The bank forecasts Li & Fung’s earnings to grow 73.4 percent in 2013.
* China’s new infrastructure investments will fuel commodity demand in the world’s second-largest economy, Rio Tinto plc (ADR) (NYSE:RIO) (LON:RIO) (ASX:RIO)’s Australian managing director, David Peever, said at a conference in Canberra.
* Chinese personal computer maker Lenovo Group Limited (HKG:0992) will acquire U.S.-based software company Stoneware Inc. for an undisclosed sum in a bid to grow its cloud computing offerings. This was its first acquisition of a software vendor.
Economic Calendar for Tuesday, September 18, 2012:
07:45 A.M. ET: ICSC-Goldman Store Sales (Week ending Saturday, September 15)
08:00 A.M. ET: Chicago Federal Reserve President Charles Evans speaks.
08:30 A.M. ET: Current Account (Q2)
08:55 A.M. ET: Redbook Index (MoM)
08:55 A.M. ET: Redbook Index (YoY)
09:00 A.M. ET: Net Long-Term TIC Flows (July)
09:00 A.M. ET: Total Net TIC Flows (July)
10:00 A.M. ET: NAHB Housing Market Index (September)
11:30 A.M. ET: New York Federal Reserve Bank President William Dudley speaks.
11:30 A.M. ET: 4-Week Bill Auction
11:30 A.M. ET: 52-Week Bill Auction
06:15 P.M. ET: Richmond Federal Reserve Bank President Jeffrey Lacker speaks.