Morning Market Update
Gates Capital Management's ECF Value Funds have a fantastic track record. The funds (full-name Excess Cash Flow Value Funds), which invest in an event-driven equity and credit strategy, have produced a 12.6% annualised return over the past 26 years. The funds added 7.7% overall in the second half of 2022, outperforming the 3.4% return for Read More
• US: Dow: 12830.00 (-0.25%), S&P 500: 1392.00 (-0.39%), NASDAQ: 2632.00 (-0.33%)
• Europe: CAC: 3485.48 (-0.48%), DAX: 7286.54 (-0.63%), FTSE: 5774.80 (-0.43%).
• Asia-Pacific: Australia: 4447.30 (-0.21%), China: 1973.52 (-0.89%), Hong Kong: 21708.98 (-0.62%), India: 5727.45 (0.00%), Japan: 9308.35 (-1.23%).
• Metals: Gold: 1718.30 (-1.38%), Silver: 33.46 (-1.55%), Copper: 3.51 (-0.79%)
• Energy: Crude Oil: 86.21 (-1.11%), Natural Gas: 3.80 (-2.29%)
• Commodities: Corn: 7.61 (1.63%), Soya Bean: 14.43 (1.77%), Wheat: 8.83 (2.95%)
• Currency: EUR/USD: 1.2891 (-0.41%), GBP/USD: 1.5971 (-0.32%), USD/JPY: 81.8200 (-0.41%)
• 10 year US Treasury: 1.605% (-0.032)
Financial and Economic News Update
U.S. stock-index futures drop: U.S. stock-index futures are pointing to a lower open on Wednesday, amid investor concerns about whether Congress can adequately address the so-called fiscal cliff. On the economic front, new home sales report for October is due at 10 A.M. ET. Economists are expecting a reading of 390,000.
European markets fall: European markets are down in trade today, with the German DAX (INDEXDB:DAX) dropping 0.6 percent to 7286.54, the FTSE 100 (INDEXFTSE:UKX) falling 0.4 percent to 5774.80 and the CAC 40 (INDEXEURO:PX1) edging 0.5 percent lower to 3485.48. The euro zone blue-chip ESTX 50 PR.EUR (INDEXSTOXX:SX5E) (Euro Stoxx 50) was trading 0.8 percent lower.
Asian markets end lower: Asian markets closed lower on Wednesday with the HANG SENG INDEX (INDEXHANGSENG:HIS) down 0.6 percent at 21708.98 points, while the SSE Composite Index (SHA:000001) (Shanghai Composite Index) shed 0.9 percent. Japan’s NIKKEI 225 (INDEXNIKKEI:NI225) slid 1.2 percent to 9308.35 points. The S&P/ASX 200 (INDEXASX:XJO) index closed down 0.2 percent at 4447.30. The benchmark Indian 30-share BSE SENSITIVE (INDEXBOM:SENSEX) index was closed for a public holiday.
Company News Update
• Microsoft Corporation (NASDAQ:MSFT) said it sold 40 million copies of its new operating system Windows 8 in the month since the launch.
• Board members of daily deal website Groupon Inc (NASDAQ:GRPN) have been discussing making leadership changes at the company, including replacing Chief Executive Andrew Mason, the AllThingsD blog reported late yesterday.
• Costco Wholesale Corporation (NASDAQ:COST) posted better than expected November same-store sales increase of 6 percent, and announced a special cash dividend of $7 per share.
• Knight Capital Group Inc. (NYSE:KCG) soared 20 percent in pre-market trading after Chicago-based Getco LLC offered to buy the trading firm for $3.50 a share.
• EBay Inc (NASDAQ:EBAY) said volume of mobile transactions on Cyber Monday more than doubled compared to a year ago, while the company’s PayPal unit saw global mobile payment volume nearly triple.
• American Eagle Outfitters (NYSE:AEO) reported third quarter profit of $78.6 million, or 39 cents a share, up from $52.4 million, or 27 cents a share, in the year-ago period. Income from continuing operations stood at 41 cents a share. Sales increased 11 percent to $910.4 million from $819.5 million a year earlier. Analysts were expecting the company to earn 39 cents a share on sales of $873.9 million.
• PVH Corp (NYSE:PVH), the parent company of Tommy Hilfiger and Calvin Klein reported third quarter earnings excluding items of $2.34 a share, 4 cents above the average analysts’ estimate. Revenue for the period was in line with expectations. The company also raised its full year profit outlook.
• Research In Motion Limited (USA) (NASDAQ:RIMM) (TSE:RIM) fell 2 percent in early morning trade after a Swedish arbitrator ruled against the Blackberry maker in a patent dispute with Nokia Corporation (ADR) (NYSE:NOK).
• Packaged goods maker McCormick & Company, Incorporated (NYSE:MKC) raised its quarterly dividend by 9.7 percent to 34 cents a share from 31 cents a share.
• Advanced Micro Devices, Inc. (NYSE:AMD) is planning to sell its Texas campus to raise cash. The chipmaker expects to get $150 million to $200 million for the campus.
• Technology company Splunk Inc (NASDAQ:SPLK)’s co-founder Erik Swan will step-down from the board but will remain as Chief Technology Officer.
• Clothing retailer Jos. A. Bank Clothiers Inc (NASDAQ:JOSB) reported third-quarter profit of 47 cents per share, eight cents below estimates. Sales increased 11 percent to $232.9 million, topping estimates of $231.8 million.
• Chinese advertising agency Focus Media Holding Limited (ADR) (NASDAQ:FMCN) posted third quarter earnings excluding one-time items of 71 cents a share, edging past expectations by a penny a share. But revenue trailed Street expectations.
• Akamai Technologies, Inc. (NASDAQ:AKAM) gained 1.5 percent in pre-market trading after analysts at Piper Jaffray upgraded the web application developer to “overweight” from “neutral.”
• Sherwin-Williams Company (NYSE:SHW) fell 1 percent as Nomura lowered the stock to “neutral” from “buy” with a target price of $170.
• Energy major BP plc (ADR) (NYSE:BP) (LON:BP) agreed to sell stakes in North Sea fields to the state-owned Abu Dhabi National Energy Company for $1.1 billion.
• Healthcare firm Smith & Nephew plc (ADR) (NYSE:SNN) (LON:SN) is down 0.8 percent in London after agreeing to acquire privately-held U.S. wound-care-treatment developer Healthpoint Biotherapeutics for $782 million in cash.
• ThyssenKrupp AG (ETR:TKA) (FRA:TKA) slid 1.4 percent after Sueddeutsche Zeitung reported that the German steel-maker may get as little as 1 billion euros ($1.29 billion) from the sale of its Steel Americas unit.
• British travel agent Thomas Cook Group plc (LON:TCG) reported widening annual losses due to high fuel costs and social unrest in popular destinations, and cut its dividend after making a number of charges.
• Metro AG (ETR:MEO) (FRA:MEO) fell 3 percent after closely held German investment company Franz Haniel & Cie. GmbH said it will reduce its stake in the retailer to 30 percent from 34.2 percent within the next 18 months.
• Vivendi SA (EPA:VIV) is planning to cut as many as 856 jobs at its French telecom unit SFR, as part of a restructuring plan, according to a report in The Wall Street Journal.
• British semiconductor and software design company Arm Holdings plc (ADR) (NASDAQ:ARMH) (LON:ARM) gained 1 percent following a report in The Daily Mail that Intel Corporation (NASDAQ:INTC) was looking to buy the firm.
• OAO MegaFon slipped 1.4 percent on its first day of trading in London after the Russian mobile operator raised $1.7 billion in the biggest initial offering by a Russian company in three years. MegaFon priced its share sale at the bottom of a guided range.
• LVMH Moet Hennessy Louis Vuitton SA (EPA:MC) added 1 percent after Nomura raised the luxury-goods firm to “buy” from “neutral.”
• Belgian food retailer Delhaize Group (ADR) (NYSE:DEG) (EBR:DELB) gained 3 percent after analysts at Exane BNP Paribas lifted the stock to “outperform” from “neutral.”
• Sony Corporation (ADR) (NYSE:SNE) (TYO:6758) fell 1.5 percent in Tokyo after Reuters reported that several investment banks had approached the Japanese electronics giant over the possible sale of its battery-making unit.
• CNOOC Limited (ADR) (NYSE:CEO) (HKG:0883) lost 1.8 percent in Hong Kong trading after the Chinese state-owned company and its Canadian takeover target Nexen Inc. (USA) (NYSE:NXY) (TSE:NXY) resubmitted their application for review by the U.S. government.
• Canon Inc. (ADR) (NYSE:CAJ) (TYO:7751) closed 3.1 percent lower after the Nikkei business daily reported that the camera-maker is planning to drastically reduce its consolidated inventory by the end of the year.
• Great Wall Motor Co Ltd (HKG:2333) (SHA:601633) rose 1.2 percent after the Xinhua news agency reported that automobile sales and output in China will both exceed 19 million units this year, up from last year’s 14.5 million.
• Australian mining services firm NRW Holdings Limited (ASX:NWH) slumped 18 percent accompanied by heavy volumes after it said full-year net profit margins may drop to as low as 5 percent due to weaker prices.
• Kawasaki Kisen Kaisha, Ltd. (TYO:9107) slid 4.6 percent after Japan’s third-largest shipping company said it will delay an expansion of its commodity-transport fleet due to weak global demand.
• Hulic Co Ltd (TYO:3003) plunged 12 percent after the Japanese real-estate company said it would raise up to 37 billion yen ($415 million) via a public share sale to finance renovation of buildings that it owns.
• Retailer JB Hi-Fi Limited (ASX:JBH) tumbled 5.5 percent in Sydney after it said it would expand into home appliances as earnings from entertainment goods like DVDs, CDs and games drop due to online competition.
Economic Calendar for Wednesday, November 28, 2012:
07:00 A.M. ET: MBA Purchase Applications (Week ending Friday, November 23)
10:00 A.M. ET: New Home Sales (MoM) (October)
10:00 A.M. ET: New Home Sales Change (MoM) (October)
10:30 A.M. ET: EIA Petroleum Status Report (Week ending Friday, November 23)
12:15 P.M. ET: Federal Reserve Governor Daniel Tarullo speaks.
01:00 P.M. ET: 5-Year Note Auction
02:00 P.M. ET: Fed’s Beige Book