Morning Market Update
Stocks that are expected to trade actively in U.S. markets on Tuesday include: Apple Inc. (NASDAQ:AAPL), The Home Depot, Inc. (NYSE:HD), Best Buy Co., Inc. (NYSE:BBY), JPMorgan Chase & Co. (NYSE:JPM), Urban Outfitters, Inc. (NASDAQ:URBN), Carnival Corporation (NYSE:CCL), TiVo Inc. (NASDAQ:TIVO), Cinemark Holdings, Inc. (NYSE:CNK), Medtronic, Inc. (NYSE:MDT), Rockwood Holdings, Inc. (NYSE:ROC), The Blackstone Group L.P. (NYSE:BX), The Fresh Market Inc (NASDAQ:TFM), SoundBite Communications Inc (NASDAQ:SDBT)
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• US: Dow Futures: 15330.00 (0.07%), S&P 500 Futures: 1664.30 (-0.02%), NASDAQ Futures: 3021.75 (0.02%)
• Europe: CAC: 4017.69 (-0.13%), DAX: 8440.06 (-0.19%), FTSE: 6767.56 (0.18%)
• Asia-Pacific: Australia: 5180.10 (-0.55%), China: 2305.11 (0.22%), Hong Kong: 23366.37 (-0.54%), Japan: 15381.02 (0.13%).
• Metals: Gold: 1373.90 (-0.74%), Silver: 22.40 (-0.83%), Copper: 3.37 (0.33%)
• Energy: Crude Oil: 96.39 (-0.33%), Natural Gas: 4.16 (1.61%)
• Commodities: Corn: 6.36 (-0.46%), Soya Bean: 14.62 (1.02%), Wheat: 6.75 (1.17%)
• Currency: EUR/USD: 1.2868 (-0.11%), GBP/USD: 1.5144 (-0.73%), USD/JPY: 102.7800 (0.50%)
• 10 year US Treasury: 1.970% (0.005)
Market and Economic News Update
U.S. stock-index futures largely unchanged: U.S. stock-index futures are pointing to a flat open on Tuesday, as investors look ahead to speeches by Fed vice chairman William Dudley and Saint Louis Fed President Bullard, for more clues on any tapering of the quantitative easing program. Fed Chairman Ben Bernanke will testify before the Congress on Wednesday. No major economic data is scheduled for release on Tuesday.
European markets largely lower: European markets are down in trade, as investors take a breather following the climb to multi-year highs in the prior day’s session. On the economic front, inflation data for the U.K. came in lower-than-expected, while German producer prices showed a month-on-month decline to -0.2 percent for April. The DAX (INDEXDB:DAX) dropped 0.2 percent to 8440.06. The FTSE 100 (INDEXFTSE:UKX) added 0.2 percent to jump to a new 13-year high, while the CAC 40 (INDEXEURO:PX1) lost 0.1 percent to 4017.69 points. The euro zone blue-chip ESTX 50 PR.EUR (INDEXSTOXX:SX5E) (Euro Stoxx 50) dropped 0.4 percent.
Asian markets end mixed: Asian stocks finished mixed on Tuesday, amid investor concerns about the uncertainty surrounding the U.S. monetary policy. The HANG SENG INDEX (INDEXHANGSENG:HSI) snapped a three-day winning streak to close o.5 percent lower, while the SSE Composite Index (SHA:000001) (Shanghai Composite Index) edged 0.2 percent higher. The NIKKEI 225 (INDEXNIKKEI:NI225) hit a fresh closing high of 15,381 in a choppy session of trade. The S&P/ASX 200 (INDEXASX:XJO) index fell 0.5 percent, hurt by weakness in resource stocks.
Stocks in News
Apple Inc. (NASDAQ:AAPL)
Apple Inc. (NASDAQ:AAPL) will be in focus as CEO Tim Cook appears on Capitol Hill to testify about his company’s tax practices. A Senate investigation has revealed that the tech giant used Irish affiliates to avoid at least $3.5 billion in U.S. federal taxes in 2011, and $9 billion in 2012. Apple has refuted the subcommittee’s findings and said it paid “an extraordinary amount” in US taxes and “does not use tax gimmicks.”
The Home Depot, Inc. (NYSE:HD)
The Home Depot, Inc. (NYSE:HD) posted first quarter profit of 83 cents per share, six cents above the average analysts’ estimate. Revenue also topped projections, and the home improvement retailer raised its earnings and sales outlook for the year as it continues to benefit from the turnaround in the housing market.
Best Buy Co., Inc. (NYSE:BBY)
Best Buy Co., Inc. (NYSE:BBY) reported first quarter profit excluding certain items of 32 cents per share, above estimates of 25 cents per share. Revenue fell 10 percent to $9.38 billion, well short of estimates of $10.66 billion. Comparable store sales fell 1.3 percent during the period. The electronics chain recorded a loss of 53 cents per share from discontinued operations versus a loss of three cents in the year-ago period. Shares fell close to 3 percent in early morning trade.
JPMorgan Chase & Co. (NYSE:JPM)
JPMorgan Chase & Co. (NYSE:JPM) holds its annual meeting of shareholders today, with most attention focused on a vote on whether to strip Chief Executive Officer Jamie Dimon of his title of Chairman of the board. Shares are largely unchanged before the start of regular session of trading.
Urban Outfitters, Inc. (NASDAQ:URBN)
Urban Outfitters, Inc. (NASDAQ:URBN) reported a 39 percent increase in first-quarter profit, helped by stronger sales and better margins. The apparel retailer’s earnings came in at 32 cents a share, 3 cents above the consensus estimate. Sales jumped 14 percent to $648.2 million during the period, but missed estimates of $655.7 million. Shares dipped in extended-hours trading. Shares closed Monday at $44.49, and fell in pre-market trading.
Carnival Corporation (NYSE:CCL)
Cruise company Carnival Corporation (NYSE:CCL) lowered its full-year outlook for the second time in less than three months, citing higher costs and lower ticket pricing. The company now expects earnings of between $1.45 a share and $1.65 a share, trailing current Wall Street estimates for $1.98 a share. Shares plunged in early morning trade.
TiVo Inc. (NASDAQ:TIVO)
TiVo Inc. (NASDAQ:TIVO) reported a narrower first-quarter loss, amid a rise in pay-TV subscribers, and strong sales of its trademark digital video recorders. The company posted a loss of 9 cents a share, beating expectations for a loss of 14 cents a share, on revenue of $62 million that was in-line with expectations. In addition, the company provided better than expected current-quarter sales guidance, sending shares higher in pre-open session.
Cinemark Holdings, Inc. (NYSE:CNK)
Movie-theater chain Cinemark Holdings, Inc. (NYSE:CNK) has agreed to sell theaters in Kentucky, New Jersey and Texas, as part of antitrust requirements to acquire Rave Holdings LLC, the Justice Department said on Monday. The company will also have to sell Movie Tavern, which operates movie theaters in Fort Worth and Denton, Texas. Cinemark Holdings, Inc. (NYSE:CNK) had announced in November that it would buy movie theaters from Rave Cinemas in 12 states.
Medtronic, Inc. (NYSE:MDT)
Medtronic, Inc. (NYSE:MDT) reported fourth quarter earnings excluding certain items of $1.10 per share, seven cents above estimates. Revenue increased 3.8 percent to $4.46 billion, also above consensus of $4.39 billion. For the full-year, the medical device maker forecast earnings of $3.80 to $3.85 a share, on revenue growth of 3 percent to 4 percent. Shares gained in pre-market session.
Rockwood Holdings, Inc. (NYSE:ROC), The Blackstone Group L.P. (NYSE:BX)
Private equity firms, The Blackstone Group L.P. (NYSE:BX) and Advent International Corp are interested in acquiring Rockwood Holdings, Inc. (NYSE:ROC)’s pigments businesses, Reuters reported late Monday. The buyout firms have tabled offers for the assets, which could fetch up to $2 billion. According to people familiar with the matter, Apollo Global Management LLC (NYSE:APO), Bain Capital LLC, Golden Gate Capital LLC and Rhone Group LLC are also participating in the auction.
The Fresh Market Inc (NASDAQ:TFM)
Specialty grocery chain The Fresh Market Inc (NASDAQ:TFM) has appointed Jeffrey Ackerman as executive vice president and CFO, effective June 3. Ackerman was previously the Chief Financial Officer at Sealy Corporation (NYSE:ZZ). Fresh Market named Chief Operating Officer Sean Crane as interim CFO after Lisa Klinger left the company in December to join apparel retailer Kellwood Co. Shares slid 25 cents to $46.22 in pre-market trading.
SoundBite Communications Inc (NASDAQ:SDBT)
Call center software maker Genesys Telecommunications Laboratories Inc. has agreed to buy SoundBite Communications Inc (NASDAQ:SDBT) for about $100.4 million to add to its cloud-based offerings. Genesys will pay $5 a share to buy SoundBite, a 67 percent premium to the stock’s closing price on Monday. The deal is expected to close in the third quarter of this year. SoundBite specializes in cloud-based mobile payment technology and reported revenue of $48.1 million in 2012.
Economic Calendar for Tuesday, May 21, 2013:
07:45 A.M. ET: ICSC-Goldman Store Sales
08:55 A.M. ET: Redbook Index (MoM) (May 12)
08:55 A.M. ET: Redbook Index (YoY) (May 12)
11:30 A.M. ET: St. Louis Federal Reserve Bank President James Bullard speaks.
11:30 A.M. ET: 4-Week Bill Auction
01:00 P.M. ET: New York Federal Reserve Bank President William Dudley speaks.