Morning Market Update
* US: Dow Futures: 13302.00 (0.28%), S&P 500 Futures: 1431.90 (0.25%), NASDAQ Futures: 2719.00 (0.21%)
* Europe: CAC: 3397.42 (-0.45%), DAX: 7256.79 (-0.34%), FTSE: 5806.31 (-0.40%).
* Asia-Pacific: Australia: 4486.60 (0.07%), China: 2104.93 (0.10%), Hong Kong: 21136.43 (0.65%), India: 5676.05 (-0.56%), Japan: 8534.12 (-0.15%).
* Metals: Gold: 1771.00 (0.02%), Silver: 33.92 (-0.48%), Copper: 3.72 (-0.84%)
* Energy: Crude Oil: 92.32 (0.27%), Natural Gas: 3.61 (0.06%)
* Commodities: Corn: 7.67 (4.99%), Soya Bean: 15.32 (1.67%), Wheat: 8.77 (1.64%)
* Currency: EUR/USD: 1.2977 (0.38%), GBP/USD: 1.6086 (0.26%), USD/JPY: 78.3300 (-0.03%)
* 10 year US Treasury: 1.654% (-0.016)
Financial and Economic News Update
U.S. stock-index futures trading higher: U.S. stock-index futures are pointing to a higher open on Friday, buoyed by better-than-expected earnings from JPMorgan Chase & Co. (NYSE:JPM). On the economic front, producer prices increased 1.1 percent in September as the cost of energy surged, according to the Labor Department. Economists had expected a rise of 0.7 percent. The Dow Jones industrial average, the S&P 500 and the NASDAQ are all trading modestly higher.
European markets in the red: European markets are trading lower on Friday with the German DAX (INDEXDB:DAX) down 0.3 percent at 7256.79, the FTSE 100 (INDEXFTSE:UKX) lost 0.4 percent to 5806.31 and the CAC 40 (INDEXEURO:PX1) slid 0.5 percent to 3397.42. The euro zone blue-chip ESTX 50 PR.EUR (INDEXSTOXX:SX5E) (Euro Stoxx 50) was trading largely unchanged.
Asian markets end mixed: Asian markets closed mixed on Friday with the HANG SENG INDEX (INDEXHANGSENG:HIS) up 0.7 percent for the day and 0.6 percent for the week at 21,136.4, while the SSE Composite Index (SHA:000001) (Shanghai Composite Index) gained 0.1 percent and 0.9 percent this week. Japan’s NIKKEI 225 (INDEXNIKKEI:NI225) eased 0.2 percent to 8,534.12, losing ground for a fifth straight session. The S&P/ASX 200 (INDEXASX:XJO) index rose 3.1 points to 4,486.6. The benchmark Indian 30-share BSE SENSITIVE (INDEXBOM:SENSEX) index fell 0.8 percent.
Company News Update
* JPMorgan Chase & Co. (NYSE:JPM) reported third quarter net income of $5.71 billion, or $1.40 a share, up 34 percent from $4.26 billion, or $1.02 a share, in the same period last year. Revenue rose 6 percent to $25.86 billion compared to $24.37 billion a year ago. Analysts were expecting earnings of $1.21 a share on revenue of $24.4 billion.
* Wells Fargo & Company (NYSE:WFC) reported third-quarter earnings excluding items of 88 cents a share that beat the average analysts’ estimate of 87 cents a share. Revenue rose to $21.2 billion from $19.63 billion a year ago, trailing Street expectations of $21.47 billion.
* Google Inc (NASDAQ:GOOG)’s share of the search market rose 0.3 percent in September to 66.7 percent, according to latest data from digital analytics company ComScore. Microsoft Corporation (NASDAQ:MSFT) is second on the list with 15.9 percent, followed by Yahoo! Inc. (NASDAQ:YHOO) with 12.2 percent.
* Microsoft Corporation (NASDAQ:MSFT) advanced percent in early morning trade after the company said the latest version of its Office software will be available in the first quarter of 2013.
* Cleaning and pest-control services company Ecolab Inc. (NYSE:ECL) agreed to buy privately-held specialty chemical company Champion Technologies in a cash-and-stock deal valued at about $2.2 billion.
* Drugstore chain CVS Caremark Corporation (NYSE:CVS) is under investigation by the U.S. Department of Health and Human Services for potential Medicare fraud, according to a report in the Los Angeles Times.
* Biotech firm Biogen Idec Inc. (NASDAQ:BIIB) said new data from studies evaluating its experimental multiple Sclerosis treatment BG-12 further supports its effectiveness and safety.
* Electronic Arts Inc. (NASDAQ:EA), Activision Blizzard, Inc. (NASDAQ:ATVI) and Take-Two Interactive Software, Inc. (NASDAQ:TTWO) are likely to be in focus today after data released by research firm NPD Group showed that sales of videogame software fell 18 percent in September compared to the same period last year.
* Information technology company iGate Corporation (NASDAQ:IGTE) reported third quarter earnings excluding items of 46 cents a share, on revenue of $271.1 million. Analysts were expecting earnings of 37 cents on revenue of $277 million.
* KMG Chemicals, Inc. (NYSE:KMG) reported fourth-quarter net income of $3.86 million or 33 cents per share, up from $1.18 million or 10 cents per share in the year-ago period. Sales declined to $67.61 million from $70.94 million a year earlier.
* Lexicon Pharmaceuticals, Inc. (NASDAQ:LXRX) said a mid- stage study of its investigational new drug to treat carcinoid syndrome showed positive results.
* Wal-Mart Stores, Inc. (NYSE:WMT) has been raised to “buy” from “hold” by analysts at Jefferies with a target price of $88.
* Linkedin Corporation (NYSE:LNKD) is up 1.8 percent in pre-market trading after Evercore Partners upgraded the business social networking company’s shares to “overweight” from “neutral.”
* Citigroup Inc. (NYSE:C) has downgraded hard disk drive maker Western Digital Corp. (NASDAQ:WDC) to “sell” from “buy” with a target price of $32.
* Banking stocks across Europe moved higher after Deutsche Bank upgraded European lenders and insurance companies to “overweight” from “neutral.” HSBC Holdings plc (ADR) (NYSE:HBC) (LON:HSBA) (HKG:0005) gained 0.5 percent, Royal Bank of Scotland Group plc (ADR) (NYSE:RBS) (LON:RBS) added 1 percent and Barclays PLC (ADR) (NYSE:BCS) (LON:BARC) jumped 1.2 percent. In Germany, Commerzbank AG (ETR:CBK) (FRA:CBK) surged close to 2 percent. BNP Paribas SA (EPA:BNP) and Societe Generale SA (EPA:GLE) were also trading around a percent higher in Paris.
* Spanish phone company Telefonica S.A. (ADR) (NYSE:TEF) (MCE:TEF) has reached a 1 billion euro ($1.3 billion) deal to sell its Atento call-center division to Bain Capital Partners LLC.
* Private equity firm Carlyle Group LP (NASDAQ:CG) has received an extension from the UK Takeover Panel to iron out a deal to buy defence equipment maker Chemring Group plc (LON:CHG).
* Sanofi SA (ADR) (NYSE:SNY) (EPA:SAN), GlaxoSmithKline plc (ADR) (NYSE:GSK) (LON:GSK) and Novo Nordisk A/S (ADR) (NYSE:NVO) (CPH:NOVO-B), were all trading lower after Deutsche Bank downgraded the European health-care sector to “underweight” from “neutral.”
* Abu Dhabi’s sovereign wealth fund, Aabar Investments has sold its remaining 3.07 percent stake in German carmaker Daimler AG (ETR:DAI) (FRA:DAI).
* STMicroelectronics N.V. (ADR) (NYSE:STM) (EPA:STM), Europe’s largest semiconductor maker, is considering a breakup of the company, according to a report in Bloomberg News.
* Swedish construction company Skanska AB (STO:SKA-B) has received a $56 million contract to upgrade infrastructure at the Stamford Hospital Campus in Connecticut, U.S.
* Russian natural gas producer Novatek OAO (MCX:NVTK) said gross natural gas production dropped 1 percent in the third quarter to 13.32 billion cubic meters from 13.45 billion cubic meters in the year-ago period.
* Copper producer Kazakhmys plc (LON:KAZ) lost 3 percent in London trading after Barclays Plc lowered the stock to “equal weight” from “overweight.” Antofagasta plc (LON:ANTO) fell 2.3 percent as HSBC Holdings Plc downgraded the stock to “underweight” from “neutral.”
* German chemical maker Lanxess AG (ETR:LXS) (FRA:LXS) retreated 3.3 percent after analysts at Credit Suisse cut the stock to “underperform” from “neutral.”
* London-listed steel maker Evraz plc (LON:EVR) was cut to “underperform” from “neutral” by analysts at Credit Suisse.
* Japanese wireless service provider Softbank Corp (TYO:9984) plunged 17 percent after Reuters reported that it is in talks with three major Japanese banks to borrow $23 billion (1.8 trillion yen) to finance a bid for U.S. mobile carrier Sprint Nextel Corporation (NYSE:S).
* Clothing retailer Fast Retailing Co Ltd (TYO:9983) hit a two-month low in Tokyo after its full-year operating profit came in below analysts’ expectations. Separately, analysts at Nomura Securities Co. cut their earnings estimates for the operator of the Uniqlo casual clothing store chain
* Foxconn International Holdings Limited (HKG:2038), the world’s biggest contract maker of cell phones, surged in early morning trade on Friday following a brokerage report from Daiwa Capital Markets that said that the company was likely to get iPhone orders soon.
* US private equity firm TPG has withdrawn its 694 million Australian dollars ($713 million) takeover bid for troubled Australian surf wear retailer Billabong International Limited (ASX:BBG).
* Chinese shipping giants, China COSCO Holdings Company Limited (HKG:1919) (SHA:601919) and China Shipping Container Lines Co Ltd (HKG:2866) (SHA:601866) have agreed to collaborate on some domestic container trade routes.
* Indian software services provider Infosys Ltd ADR (NASDAQ:INFY) (NSE:INFY) (BSE:500209) reported a 24 percent rise in quarterly profit, but slashed its annual revenue forecast and said higher wages and currency fluctuations are likely to hurt profitability.
* German auto maker Volkswagen AG (ETR:VOW) (FRA:VOW) said it delivered about 2 million cars to customers in China in the January-September period, up 18.3 percent from the year-ago period.
* Casino operator Sands China Ltd. (HKG:1928) jumped 4.7 percent in Hong Kong trading after analysts at JPMorgan Chase raised its third quarter EBITDA estimate by 12 percent.
* Chinese sportswear brand Li Ning Co. Ltd. (HKG:2331) said its chief financial officer, Chong Yik Kay will step down from November 1.
Economic Calendar for Friday, October 12, 2012:
08:30 A.M. ET: Producer Price Index (MoM) (September)
08:30 A.M. ET: Producer Price Index (YoY) (September)
08:30 A.M. ET: Producer Price Index ex Food & Energy (MoM) (September)
08:30 A.M. ET: Producer Price Index ex Food & Energy (YoY) (September)
09:55 A.M. ET: Reuters/Michigan Consumer Sentiment Index (October)
12.35 P.M. ET: Richmond Federal Reserve Bank President Jeffrey Lacker speaks.
02:00 P.M. ET: Monthly Budget Statement (September)