Morning Market Update
Stocks that are expected to trade actively in U.S. markets on Friday include: American International Group Inc (NYSE:AIG), LinkedIn Corp (NASDAQ:LNKD), Kraft Foods Group Inc (NASDAQ:KRFT), Barnes & Noble, Inc. (NYSE:BKS), Moody’s Corporation (NYSE:MCO), The Boeing Company (NYSE:BA), Gilead Sciences, Inc. (NASDAQ:GILD), OfficeMax Inc (NYSE:OMX), Automatic Data Processing (NASDAQ:ADP), Office Depot Inc (NYSE:ODP), Duke Energy Corp (NYSE:DUK), Delcath Systems, Inc. (NASDAQ:DCTH) and OpenTable Inc (NASDAQ:OPEN).
Corsair Capital highlighted its investment in a special purpose acquisition company in its first-quarter letter to investors. The Corsair team highlighted FG New America Acquisition Corp, emphasizing that the SPAC presents an exciting opportunity after its agreement to merge with OppFi, a leading fintech platform powered by artificial intelligence. Q1 2021 hedge fund letters, conferences Read More
• US: Dow Futures: 14877.00 (0.79%), S&P 500 Futures: 1603.50 (0.70%), NASDAQ Futures: 2923.05 (0.73%)
• Europe: CAC: 3897.40 (1.00%), DAX: 8078.17 (1.46%), FTSE: 6528.18 (1.04%)
• Asia-Pacific: Australia: 5129.50 (-0.01%), China: 2205.50 (1.42%), Hong Kong: 22689.96 (0.10%), India: 5944.00 (-0.92%), Japan: 13694.04 (-0.77%).
• Metals: Gold: 1474.40 (0.46%), Silver: 24.12 (1.22%), Copper: 3.25 (4.83%)
• Energy: Crude Oil: 94.38 (0.41%), Natural Gas: 4.03 (0.12%)
• Commodities: Corn: 6.63 (2.44%), Soya Bean: 13.73 (0.00%), Wheat: 7.31 (1.11%)
• Currency: EUR/USD: 1.3047 (-0.14%), GBP/USD: 1.5492 (-0.28%), USD/JPY: 99.1800 (1.27%)
• 10 year US Treasury: 1.691% (0.065)
Market and Economic News Update
U.S. stock-index futures gain: U.S. stock-index futures are pointing to a higher open on Friday after data showed that the U.S. economy created 165,000 jobs in April, and the jobless rate slid to 7.5 percent. Economists were expecting a reading of 145,000 and unemployment to hold steady at 7.6 percent. S&P 500 futures broke above the 1,600 mark, and if that level holds during regular session, it will mark the first time that the index has breached that level. Berkshire Hathaway Inc. (NYSE:BRK.A) (BRK.B) will report quarterly results after the close of trading.
European markets rally: European markets are up in trade after U.S. non-farm payrolls data came in better-than-expected. In other news, Germany’s economy is set to grow by 0.4 percent in 2013, according to the European Commission’s spring economic forecasts, down from an earlier estimate of 0.5 percent. The FTSE 100 (INDEXFTSE:UKX) is up 1.0 percent to 6528.18, the DAX (INDEXDB:DAX) added 1.5 percent to 8078.17 points and the CAC 40 (INDEXEURO:PX1) soared 1 percent. The euro zone blue-chip ESTX 50 PR.EUR (INDEXSTOXX:SX5E) (Euro Stoxx 50) gained 1.1 percent.
Asian markets end mixed: Asian stocks closed mixed on Friday amid investor caution ahead of a key job report from the U.S. The HANG SENG INDEX (INDEXHANGSENG:HIS) and the SSE Composite Index (SHA:000001) (Shanghai Composite Index) closed higher following news that the Chinese central bank initiated new measures to open up the country’s capital markets. Australia’s S&P/ASX 200 (INDEXASX:XJO) index gave up gains made earlier in the session to end flat. The NIKKEI 225 (INDEXNIKKEI:NI225) was closed for the Golden Week holiday.
Stocks in News
American International Group Inc (NYSE:AIG)
American International Group Inc (NYSE:AIG) reported better than expected quarterly profit, helped by strong performance at its property and casualty unit. The insurer posted earnings of $1.34 a share on sales of $8.56 billion. Analysts were expecting earnings of 87 cents a share on sales of $8.64 billion. Operating income at its property-casualty unit jumped 52 percent to $1.59 billion, as the business witnessed growth in both underwriting income and net investment income, the New York-based company said in a statement. Shares rose in pre-market trading.
LinkedIn Corp (NASDAQ:LNKD)
LinkedIn Corp (NASDAQ:LNKD) shares fell sharply in early trade after the social networking site forecast disappointing current quarter revenue. First quarter earnings excluding one-time items were 45 cents a share, 14 cents above the consensus estimate. Sale jumped to $325 million, also exceeding expectations for $317 million. For the current quarter, the company said that revenue would range from $342 million to $347 million, compared with analysts’ projections for $359.3 million.
Kraft Foods Group Inc (NASDAQ:KRFT)
Kraft Foods Group Inc (NASDAQ:KRFT) reported better than expected earnings and revenue, despite costs related to its spin-off from its global snacks and candy business. First quarter earnings came in at 76 cents a share, 12 cents above the average analysts’ estimate. Revenue rose 2.1 percent to $4.55 billion, also edging past expectations for $4.48 billion. In addition, the food company reiterated its full-year earnings outlook of $2.75 a share, compared to Street expectations for $2.78 a share. Shares edged higher in pre-market trading.
Barnes & Noble, Inc. (NYSE:BKS)
Barnes & Noble, Inc. (NYSE:BKS) is adding Google Play app store to its Nook HD products, expanding the number of available apps from about 10,000 to more than 700,000. The addition of Google’s services should help boost Nook sales in the rapidly expanding tablet market. Sales at the Nook unit fell during the holiday season after gaining 38 percent last year. Shares gained following the announcement.
Moody’s Corporation (NYSE:MCO)
Moody’s Corporation (NYSE:MCO) posted first-quarter profit that beat analysts’ expectations, as the credit rating agency continued to benefit from a wave of corporate debt issues. Excluding certain items, the company earned 97 cents per share, 10 cents above the average analysts’ estimate. Revenue increased 13 percent to $731.8 million, also beating estimates of $729.1 million. In addition, the company raised its view for the year, and now expects earnings of $3.49 to $3.59 a share, compared to its earlier outlook of $3.45 to $3.55 a share. Shares closed Thursday at $60.55 and were inactive in pre-market trading.
The Boeing Company (NYSE:BA)
The Boeing Company (NYSE:BA) has agreed to compensate state-run Air India for the grounding of the 787 Dreamliner aircraft due to the battery-fire incidents. The size of the compensation was not disclosed. Air India was among eight Dreamliner operators worldwide that stopped flying the jets. The carrier expects to restart Dreamliner operations on domestic routes from the middle of this month.
Gilead Sciences, Inc. (NASDAQ:GILD)
Gilead Sciences, Inc. (NASDAQ:GILD) said its net income jumped 63 percent in the first quarter on lower costs and strong sales of new products. The biotechnology company posted earnings excluding one-time items of 48 cents a share, on sales of $2.53 billion, trailing expectations for 50 cents a share on revenue of $2.58 billion. Sales of its two biggest-selling HIV drugs, Atripla and Truvada, both fell during the period. Shares edged lower in early trading.
Automatic Data Processing (NASDAQ:ADP)
Automatic Data Processing (NASDAQ:ADP) said fiscal third-quarter earnings rose 6.7 percent, helped by improved revenue from all three of its main segments. The payroll and benefits-administration company posted earnings of 99 cents a share, on revenue of $3.11 billion, compared to Street estimates of earnings of 98 cents a share on revenue of $3.11 billion. In addition, the company raised the low end of its full-year outlook. Shares closed Thursday at $67.39 and were up in pre-market trading.
OfficeMax Inc (NYSE:OMX)
An OfficeMax Inc (NYSE:OMX) shareholder sued the directors of the company, seeking to block its proposed $1.2 billion acquisition by larger rival Office Depot Inc (NYSE:ODP), calling the all-stock deal “grossly inadequate”. Under the terms of the deal, announced on February 20, OfficeMax Inc (NYSE:OMX) shareholders would get 2.69 shares in Office Depot Inc (NYSE:ODP) for each one of their shares. Chairman Rakesh Gangwal and CEO Ravichandra Saligram were among the directors named as individual defendants.
Duke Energy Corp (NYSE:DUK)
Duke Energy Corp (NYSE:DUK) reported first quarter earnings excluding certain items of $1.02 per share, two cents below estimates. Revenue jumped 62 percent to $5.9 billion, topping analysts’ forecasts. Duke Energy Corp (NYSE:DUK) said demand for commercial electricity fell compared to a year earlier. In addition, the largest U.S. power provider backed its full-year earnings guidance. Shares were up close to a percent in pre-market.
Delcath Systems, Inc. (NASDAQ:DCTH)
Delcath Systems, Inc. (NASDAQ:DCTH) said a panel of advisers to the U.S. Food and Drug Administration recommended against approving its cancer therapy for a rare form of eye cancer that spreads to the liver, saying that the risks outweighed the benefits. The advisory committee’s recommendations are non-binding, and the final decision on approval is made by the FDA. Shares fell heavily in pre-market trading.
OpenTable Inc (NASDAQ:OPEN)
OpenTable Inc (NASDAQ:OPEN)’s quarterly profit jumped 48 percent as more diners used its booking service. The restaurant reservation website reported first quarter earnings excluding one-time items of 45 cents a share, topping expectations by 2 cents a share, while revenue was in line at $46 million. In addition, the company provided current quarter earnings guidance that matched forecasts, while revenue outlook was slightly lower than expected. Shares fell in early-hours trading.
Economic Calendar for Friday, May 03, 2013:
08:30 A.M. ET: Non-farm Payrolls (April)
08:30 A.M. ET: Unemployment Rate (April)
08:30 A.M. ET: Average Hourly Earnings (MoM) (April)
08:30 A.M. ET: Average Hourly Earnings (YoY) (April)
08:30 A.M. ET: Average Weekly Hours (April)
10:00 A.M. ET: Factory Orders (MoM) (March)
10:00 A.M. ET: ISM Non-Manufacturing PMI (April)
12:30 P.M. ET: Federal Reserve Governor Daniel Tarullo speaks.
12:45 P.M. ET: Richmond Federal Reserve Bank President Jeffrey Lacker speaks.