Morning Market Update
At this year's SALT New York conference, Jean Hynes, the CEO of Wellington Management, took to the stage to discuss the role of active management in today's investment environment. Hynes succeeded Brendan Swords as the CEO of Wellington at the end of June after nearly 30 years at the firm. Wellington is one of the Read More
• US: Dow: 12730.00 (-0.06%), S&P 500: 1384.00 (0.11%), NASDAQ: 2586.75 (0.05%)
• Europe: CAC: 3435.75 (-0.11%), DAX: 7140.16 (0.23%), FTSE: 5732.14 (-0.10%).
• Asia-Pacific: Australia: 4385.70 (0.56%), China: 2008.92 (-0.40%), Hong Kong: 21228.28 (-0.16%), India: 5571.55 (0.00%), Japan: 9142.64 (-0.12%).
• Metals: Gold: 1731.20 (-0.18%), Silver: 33.06 (-0.40%), Copper: 3.51 (-0.50%)
• Energy: Crude Oil: 88.81 (-0.53%), Natural Gas: 3.76 (1.24%)
• Commodities: Corn: 7.43 (2.13%), Soya Bean: 13.89 (0.94%), Wheat: 8.58 (0.64%)
• Currency: EUR/USD: 1.2818 (0.03%), GBP/USD: 1.5928 (0.12%), USD/JPY: 81.5300 (0.14%)
• 10 year US Treasury: 1.623% (0.009)
Financial and Economic News Update
U.S. stock-index futures largely unchanged: U.S. stock-index futures are pointing to a flat open on Tuesday, after rallying nearly 2 percent in the previous session, following weak quarterly results from Hewlett-Packard Company (NYSE:HPQ). On the economic front, the Commerce Department said housing starts gained 3.6 percent in October to a seasonally-adjusted 894,000, hitting its highest rate since July 2008. Permits fell 2.7 percent last month.
European markets mostly lower: European markets were down in trade today after ratings agency Moody’s scrapped France’s top-notch credit rating. The German DAX (INDEXDB:DAX) edged 0.2 percent higher at 7140.16, the FTSE 100 (INDEXFTSE:UKX) dropped 0.1 percent to 5732.14 and the CAC 40 (INDEXEURO:PX1) lost 0.1 percent to 3435.75. The euro zone blue-chip ESTX 50 PR.EUR (INDEXSTOXX:SX5E) (Euro Stoxx 50) was trading 0.1 percent lower.
Asian markets fall: Asian markets closed lower after the Bank of Japan left interest rates unchanged on Tuesday. The HANG SENG INDEX (INDEXHANGSENG:HIS) closed down 0.2 percent at 21,228.3, while the SSE Composite Index (SHA:000001) (Shanghai Composite Index) fell 0.4 percent to 2,008.9 points. Japan’s NIKKEI 225 (INDEXNIKKEI:NI225) lost 0.1 percent to close at 9,142.6. The S&P/ASX 200 (INDEXASX:XJO) index closed up 26.1 points at 4,387.6. The benchmark Indian 30-share BSE SENSITIVE (INDEXBOM:SENSEX) index was flat in trade today.
Company News Update
• Hewlett-Packard Company (NYSE:HPQ) reported fourth quarter earnings excluding items of $1.16 a share, 2 cents above the average analysts’ estimate. Revenue stood at $29.96 billion, down from $32.12 billion a year earlier, and trailing estimates of $30.44 billion. The company forecast lower than expected current quarter adjusted profit.
• Best Buy Co., Inc. (NYSE:BBY) posted third quarter earnings excluding items of 4 cents a share that was much lower than the average analysts’ estimate of 12 cents a share. Revenue fell to $10.75 billion from $11.1 billion, but beat Street expectations for $10.73 billion.
• Campbell Soup Company (NYSE:CPB) reported first quarter earnings excluding one-time items of 88 cents a share, on revenue of $2.34 billion. Analysts had expected the world’s biggest soup maker to earn 85 cents a share on sales of $2.36 billion.
• H.J. Heinz Company (NYSE:HNZ) said second-quarter profit rose to $289.4 million or 90 cents a share, from $237 million, or 74 cents a share, in the same period last year. Sales came in at $2.83 billion, up from $2.81 billion a year earlier. Analysts had expected the ketchup maker to earn 88 cents a share on sales of $2.85 billion.
• JPMorgan Chase & Co. (NYSE:JPM) has named Marianne Lake to succeed Doug Braunstein as chief financial officer. Lake is the current CFO of the consumer and community banking business.
• New York-based hedge fund Tiger Global Management LLC has disclosed a 9.9 percent stake in struggling daily deal website Groupon Inc (NASDAQ:GRPN).
• Doughnut store chain Krispy Kreme Doughnuts (NYSE:KKD) reported third quarter earnings excluding one-time items of 12 cents a share, on revenue of $107 million that beat estimates for 8 cents a share on revenue of $105 million. In addition, the firm raised its outlook for 2013.
• Data and storage networking products company Brocade Communications Systems, Inc. (NASDAQ:BRCD) posted fourth quarter earnings excluding one-time items of 17 cents a share, on revenue of $578 million that topped forecasts for 14 cents a share on sales of $567 million.
• Home appliance maker Whirlpool Corporation (NYSE:WHR) has secured approval from the European Commission to acquire a controlling stake in German kitchen manufacturer Alno AG (ETR:ANO) (FRA:ANO), Reuters reported.
• Gun maker Smith & Wesson Holding Corporation (NASDAQ:SWHC) has lifted its second-quarter earnings and revenue outlook citing strong preliminary sales across its product lines.
• Green Mountain Coffee Roasters Inc. (NASDAQ:GMCR) has named The Coca-Cola Company (NYSE:KO) executive Brian Kelley as president and chief executive officer.
• Technology company Nuance Communications Inc. (NASDAQ:NUAN) reported fourth quarter earnings excluding one-time items of 51 cents a share, topping expectations by 3 cents, on revenue of $490 million, which trailed estimates for $496 million.
• Sturm, Ruger & Company (NYSE:RGR) announced a special dividend of $4.50 a share, payable on December 21 to shareholders of record as of December 7.
• Intel Corporation (NASDAQ:INTC) fell 1.2 percent in early morning trade as UBS AG lowered the stock to “neutral” from “buy” with a target price of $29.
• Analysts at Jefferies Group have upgraded Research In Motion Limited (USA) (NASDAQ:RIMM) (TSE:RIM) to “hold” from “underperform” with a target price of $5.
• Cliffs Natural Resources Inc (NYSE:CLF) plunged 5 percent in pre-market trading after analysts at Goldman Sachs downgraded the stock to “sell” from “neutral” with a target price of $33.
• Credit Suisse Group AG (ADR) (NYSE:CS) fell 2 percent after it said it will merge its private banking and wealth management units to cut costs. Separately, Reuters reported that the New York attorney-general is preparing to file a lawsuit against the Swiss bank for misleading investors who lost more than $11 billion on mortgage-backed securities.
• Glencore International Plc (LON:GLEN)’s shareholders have backed the commodities trader’s $67 billion merger with Xstrata PLC (LON:XTA), in a deal that would create the world’s fourth-largest diversified mining company.
• British banking group Lloyds Banking Group PLC (ADR) (NYSE:LYC) (LON:LLOY) has taken a 90 percent loss on 1.47 billion pounds ($2.3 billion) of distressed Irish property loans after selling them to a private equity group linked to Apollo Global Management LLC (NYSE:APO).
• Low-cost carrier easyJet plc (LON:EZJ) soared 5 percent after reporting a 28 percent rise in full-year pretax profit to 317 million pounds ($504 million), and increasing its annual dividend to 21.5 pence a share from 10.5 pence a share.
• Fiat SpA (BIT:F) tumbled 4.9 percent amid investors concerns that the Italian carmaker will need to raise between 1.6 billion euros and 2.9 billion euros to finance its plans to combine with Chrysler Group LLC.
• International Consolidated Airlines Grp (LON:IAG), the parent company of British Airways, added 1.8 percent after RBC Capital Markets lifted the stock to outperform, the equivalent of a buy recommendation, from underperform.
• Premier Foods Plc (LON:PFD), the owner of the Hovis bread and Bisto gravy brands, announced plans to cut around 900 jobs in its bread division to help drive profitable growth in the unit.
• InterContinental Hotels Group PLC (ADR) (NYSE:IHG) (LON:IHG) gained 2.3 percent in London trading after analysts at Barclays Plc raised the stock to “overweight” from “equal weight.”
• French retailer Carrefour SA (EPA:CA) will sell its 60 percent stake in its Indonesian supermarket operations to partner CT Corp for 525 million euros ($673 million).
• CNOOC Limited (ADR) (NYSE:CEO) (HKG:0883) gained 1.1 percent amid reports that the Chinese offshore oil and gas producer has accepted conditions set by the Canadian government to win approval for its $15.1 billion acquisition of Nexen Inc. (USA) (NYSE:NXY) (TSE:NXY).
• Virgin Australia Holdings Ltd (ASX:VAH) slid 3 percent after the carrier did not give a profit forecast for the current financial year citing economic uncertainty and poor consumer sentiment.
• Nintendo Co., Ltd (TYO:7974) fell 3.7 percent in Tokyo as its recently launched console Wii U received mixed reviews.
• Chinese home appliances retailer GOME Electrical Appliances Holding Ltd. (HKG:0493) tumbled 3.7 percent after reporting late on Monday weak third-quarter earnings.
• Japanese electronics giant Panasonic Corporation (ADR) (NYSE:PC) (TYO:6752) shed 3.8 percent in Tokyo after analysts at Deutsche Bank cut its target price to 400 yen from 590 yen.
• Packaging products maker Lee & Man Paper Manufacturing Ltd (HKG:2314) soared 11 percent after reporting higher first-half profit and announced an interim dividend of 5 Hong Kong cents per share.
• Nippon Sheet Glass Company, Limited (TYO:5202) rallied 9.4 percent to hit a four-month high after Credit Suisse upgraded the stock to “outperform” from “neutral.”
• Diversified miner Citic Pacific (HKG:0267) tumbled 4.3 percent on a dispute over royalty payments with a local partner in the $8 billion Sino iron project in Western Australia.
• Chinese internet company Qihoo 360 Technology Co Ltd (NYSE:QIHU) reported third quarter earnings excluding items of 20 cents per American depositary share, 4 cents above the average analysts’ estimate. The company forecast current quarter and full-year revenue that also topped estimates.
Economic Calendar for Tuesday, November 20, 2012:
07:45 A.M. ET: ICSC-Goldman Store Sales (Week ending Saturday, November 17)
08:30 A.M. ET: Housing Starts (MoM) (October)
08:30 A.M. ET: Building Permits (MoM) (October)
08:55 A.M. ET: Redbook Index (YoY) (November 11)
08:55 A.M. ET: Redbook Index (MoM) (November 11)
09:00 A.M. ET: Richmond Federal Reserve Bank President Jeffrey Lacker speaks.
11:30 A.M. ET: 4-Week Bill Auction
12:15 P.M. ET: Federal Reserve Chairman Ben Bernanke speaks.