Morning Market Update
Stocks that are expected to trade actively in U.S. markets on Wednesday include: FedEx Corporation (NYSE:FDX), Dell Inc. (NASDAQ:DELL), Adobe Systems Incorporated (NASDAQ:ADBE), Tesla Motors Inc (NASDAQ:TSLA), The Boeing Company (NYSE:BA), CIT Group Inc. (NYSE:CIT), La-Z-Boy Incorporated (NYSE:LZB), Smithfield Foods, Inc. (NYSE:SFD), AstraZeneca plc (NYSE:AZN), Bristol Myers Squibb Co. (NYSE:BMY), Tetra Tech, Inc. (NASDAQ:TTEK) and HealthSouth Corp (NYSE:HLS).
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US: Dow Futures: 15238.00 (-0.04%), S&P 500 Futures: 1645.20 (0.01%), NASDAQ Futures: 2992.50 (0.13%)
Europe: CAC: 3847.87 (-0.33%), DAX: 8222.20 (-0.09%), FTSE: 6346.21 (-0.44%)
Asia-Pacific: Australia: 4861.40 (0.98%), China: 2143.45 (-0.74%), Hong Kong: 20986.89 (-1.14%), Japan: 13245.22 (1.80%).
Metals: Gold: 1371.10 (0.31%), Silver: 21.64 (-0.19%), Copper: 3.16 (0.24%)
Energy: Crude Oil: 98.65 (0.21%), Natural Gas: 3.93 (0.74%)
Commodities: Corn: 5.49 (2.22%), Soya Bean: 12.89 (0.35%), Wheat: 6.92 (0.95%)
Currency: EUR/USD: 1.3396 (0.03%), GBP/USD: 1.5664 (0.14%), USD/JPY: 95.0100 (-0.34%)
10-year US Treasury: 2.167% (-0.016)
Market and Economic News Update:
U.S. stock-index futures little changed: U.S. stock-index futures are pointing to a flat open on Wednesday, as markets around the globe traded cautiously, ahead of the Federal Reserve’s policy statement and Chairman Ben Bernanke’s press briefing. With no data on the calendar, investor will closely watch the outcome of the meeting for details on when and how the Fed will pare back its bond-buying program. The Fed is scheduled to release a statement at 2 P.M. ET, while Bernanke’s press conference will take place at 2:30 P.M. ET.
European markets decline: European markets are down in a choppy session on Wednesday as investor’s focus on the U.S. Federal Reserve’s policy meeting later in the day to get clues about when the central bank may start to scale back its $85 billion monthly bond purchases. In other economic news, G8 leaders agreed to new tax evasion and avoidance proposals at a summit meeting in Northern Ireland. The CAC 40 (INDEXEURO:PX1) and the FTSE 100 (INDEXFTSE:UKX) were modestly lower, while the DAX (INDEXDB:DAX) is swinging between small gains and losses. The euro zone blue-chip ESTX 50 PR.EUR (INDEXSTOXX:SX5E) (Euro Stoxx 50) fell 0.3 percent.
Asian markets end mixed; Nikkei up close to 2%: Asian stocks struggled for direction amid investor caution ahead of U.S. Federal Reserve’s monetary-policy decision later in the day. The NIKKEI 225 (INDEXNIKKEI:NI225) rallied to a one-week high, helped by continued weakness in the yen, and strong overnight gains on Wall Street. The SSE Composite Index (SHA:000001) (Shanghai Composite Index) hit a fresh 2013 low, but pared losses to close 0.7 percent lower. The S&P/ASX 200 (INDEXASX:XJO) index jumped a percent to close at 4861.40 points amid a rally in mining stocks.
Stocks in News:
FedEx Corporation (NYSE:FDX)
The world’s largest cargo airline posted a bigger than expected third quarter profit, but forecast full-year earnings below analysts’ estimates, sending shares lower in pre-market trading. Excluding items, FedEx earned $2.13 per share, above estimates of $1.96. Revenue came in at $11.4 billion, compared to expectations for $11.45 billion. For fiscal 2014, the company expects per share earnings to rise as much as 13 percent to $7.04, which trailed analysts’ projections of $7.28 a share.
Dell Inc. (NASDAQ:DELL)
Carl Icahn stepped up his bid to take control of Dell Inc. (NASDAQ:DELL), after buying nearly $1 billion worth of shares in the ailing PC maker. Icahn said his company purchased about 72 million Dell shares at $13.52 a piece from another dissident investor, Southeastern Asset Management, making him the second-largest holder in the company after its founder, Michael Dell. Also late Tuesday, the activist investor called for the company to launch a $14-a-share tender offer for 1.1 billion shares.
Adobe Systems Incorporated (NASDAQ:ADBE)
Adobe Systems Incorporated (NASDAQ:ADBE) reported second-quarter profit that exceeded analysts’ estimates, helped by higher demand for its cloud-computing services. Excluding certain items, earnings for the period stood at 36 cents a share, topping expectations for 33 cents a share, while revenue was in line with consensus at $1.01 billion. For the current quarter, the company forecast earnings of 29 cents to 35 cents a share, against expectations for 35 cents a share. Shares rallied in early morning trade.
Tesla Motors Inc (NASDAQ:TSLA)
Tesla Motors Inc (NASDAQ:TSLA) will recall about 800 Model S vehicles due to a weakened mounting bracket that holds the left-hand back seat in place. Chairman and Chief Executive Elon Musk said that a number of cars built between May 10 and June 8 this year could contain the defect, but also clarified that there have been no customer complaints related to the issue.
The Boeing Company (NYSE:BA), CIT Group Inc. (NYSE:CIT)
The Boeing Company (NYSE:BA) has secured an order for 30 of its new generation 737 MAX 8 aircraft worth $3 billion at list prices from aircraft leasing company CIT Group Inc. (NYSE:CIT). The deal is comprised of 10 new aircrafts and the conversion of 20 existing 737 orders, and the first deliveries are expected in 2019. Boeing shares edged higher in pre-market trading.
La-Z-Boy Incorporated (NYSE:LZB)
The furniture maker posted better than expected fourth quarter earnings, amid improved revenue and higher margins. La-Z-Boy Incorporated (NYSE:LZB)’s earnings excluding items came in at 30 cents a share, 2 cents above the average analysts’ estimate. Revenue jumped 10 percent to $359.5 million, also edging past expectations for $358 million. Shares gained in pre-open trading.
Smithfield Foods, Inc. (NYSE:SFD)
Smithfield Foods, Inc. (NYSE:SFD)’s Chief Executive Larry Pope could receive as much as $46.6 million in merger-related payments as part of the pork producer’s sale to China’s Shuanghui International Holdings Ltd. for $4.7 billion, a securities filing showed late Tuesday. According to a proxy filing with the U.S. Securities and Exchange Commission, chief financial officer, Robert Manly, would also be eligible to receive about $22.8 million in potential merger-related payments.
Bristol Myers Squibb Co. (NYSE:BMY), AstraZeneca plc (ADR) (NYSE:AZN)
AstraZeneca plc (NYSE:AZN) and Bristol Myers Squibb Co. (NYSE:BMY)’s diabetes drug Onglyza did not reduce heart risks in a clinical trial, disappointing investors, who were expecting the drug to demonstrate significant cardiovascular benefit, which could have encouraged increased use of the drug, and reinvigorated demand.
Tetra Tech, Inc. (NASDAQ:TTEK)
Tetra Tech, Inc. (NASDAQ:TTEK) expects to post a loss in the fiscal third quarter, hurt by higher-than-expected restructuring costs. The engineering services company said it expects to take a loss of 30 cents to 50 cents per share during the period, compared to earlier expectations for a profit of 32 cents to 42 cents per share. Tetra Tech also cut its outlook for revenue, sending shares sharply lower in early-hours trading.
HealthSouth Corp (NYSE:HLS)
The rehab hospital operator reaffirmed its full-year earnings guidance of between $1.61 a share and $1.68 a share, compared to analysts’ expectations for $1.73 a share ahead of its conference. Shares closed Tuesday at $29.72, and were largely unchanged in pre-market trading.
Economic Calendar for Wednesday, June 19, 2013:
07:00 A.M. ET: MBA Mortgage Applications (June 14)
10:30 A.M. ET: EIA Petroleum Status Report (June 14)
02:00 P.M. ET: Fed Interest Rate Decision
02:00 P.M. ET: FOMC Economic Projections
02:30 P.M. ET: Fed’s Monetary Policy Statement and Chairman’s Press Conference