Every morning we put out a report with the latest news in global stock markets, company news, and global economic news. There is a lot of important news for October 16th 2012.
Baupost's investment process involves "never-ending" gleaning of facts to help support investment ideas Seth Klarman writes in his end-of-year letter to investors. In the letter, a copy of which ValueWalk has been able to review, the value investor describes the Baupost Group's process to identify ideas and answer the most critical questions about its potential Read More
- US: Dow Futures: 13417.00 (0.43%), S&P 500 Futures: 1442.10 (0.46%), NASDAQ Futures: 2743.50 (0.45%)
- Europe: CAC: 3467.53 (1.36%), DAX: 7358.81 (1.33%), FTSE: 5860.75 (0.94%).
- Asia-Pacific: Australia: 4491.50 (0.18%), China: 2098.81 (0.01%), Hong Kong: 21207.07 (0.28%), India: 5648.00 (-0.69%), Japan: 8701.31 (1.42%).
- Metals: Gold: 1743.70 (0.35%), Silver: 32.90 (0.46%), Copper: 3.71 (0.35%)
- Energy: Crude Oil: 91.98 (0.14%), Natural Gas: 3.45 (-1.12%)
- Commodities: Corn: 7.43 (-2.06%), Soya Bean: 15.01 (-1.06%), Wheat: 8.56 (-1.05%)
- Currency: EUR/USD: 1.3050 (0.78%), GBP/USD: 1.6119 (0.30%), USD/JPY: 78.9000 (0.38%)
- 10 year US Treasury: 1.703% (0.040)
Financial and Economic News Update
U.S. stock-index futures trading higher: U.S. stock-index futures are pointing to a higher open on Tuesday, buoyed by a batch of better than expected quarterly number. On the economic front, the Consumer Price Index rose 0.6 percent in September, according to the Labor Department, matching analysts’ expectations. International Business Machines Corp. (NYSE:IBM), Intel Corporation (NASDAQ:INTC) and CSX Corporation (NYSE:CSX) are slated to report earnings after the closing bell. The Dow Jones industrial average, the S&P 500 and the NASDAQ are all trading close to half a percent higher.
European markets rise: European markets are trading higher on Tuesday with the German DAX (INDEXDB:DAX) up 1.3 percent at 7358.81, the FTSE 100 (INDEXFTSE:UKX) gained 0.9 percent to 5860.75 and the CAC 40 (INDEXEURO:PX1) jumped 1.4 percent to 3467.53. The euro zone blue-chip ESTX 50 PR.EUR (INDEXSTOXX:SX5E) (Euro Stoxx 50) was trading 1.9 percent higher.
Asian markets end mostly higher: Asian markets closed higher on Tuesday with the HANG SENG INDEX (INDEXHANGSENG:HIS) ending up 0.3 percent at 21,207.1, while the SSE Composite Index (SHA:000001) (Shanghai Composite Index) closed up 0.01 percent. Japan’s NIKKEI 225 (INDEXNIKKEI:NI225) added 123.38 points to 8,701.31 points. The S&P/ASX 200 (INDEXASX:XJO) index ended up 8.1 points at 4,491.5. The benchmark Indian 30-share BSE SENSITIVE (INDEXBOM:SENSEX) index lost 0.7 percent.
Company News Update
- Goldman Sachs Group, Inc. (NYSE:GS) reported third quarter earnings excluding items of $2.85 a share, on revenue of $8.35 billion that easily beat the average analysts’ estimate of earnings excluding items of $2.12 a share on $7.30 billion in revenue. The vestment bank also raised its quarterly dividend 8.7 percent, to 50 cents a share from 46 cents a share.
- Johnson & Johnson (NYSE:JNJ) posted third-quarter earnings excluding items of $1.25 a share, 4 cents above the average analysts’ estimate. Revenue for the period increased to $17.10 billion from $16.01 billion a year ago, also topping estimates of $16.98 billion.
- Advertising company Omnicom Group Inc. (NYSE:OMC) reported third quarter profit of $203.9 million, or 74 cents a share, up from $203.7 million, or 72 cents, in the same period last. Revenue for the quarter stood at $3.41 billion. Analysts had forecast earnings of 72 cents on revenue of $3.42 billion.
- Wolverine World Wide, Inc. (NYSE:WWW) reported third quarter earnings excluding one-time items of 72 cents a share, on revenue of $353.1 million that trailed Street estimates of earnings excluding items of 73 cents a share on $362 million in revenue.
- Yahoo! Inc. (NASDAQ:YHOO) has named former Google Inc (NASDAQ:GOOG) executive Henrique de Castro as its new chief operating chief.
- Online retailer Amazon.com, Inc. (NASDAQ:AMZN) said it is hiring more than 50,000 seasonal workers in the U.S. this holiday season.
- United Technologies Corporation (NYSE:UTX) has agreed to sell its Electric Power Systems unit to French aerospace components maker Safran SA (EPA:SAF) for 310 million euros ($401 million) in cash.
- Murphy Oil Corporation (NYSE:MUR) will spin-off its U.S. refining and marketing unit into a separate publicly-traded company. Shares were up 9 percent in pre-market trading.
- Bank of America Corp (NYSE:BAC) has named veteran banker Margaret Ren as chairman of its China business.
- Diversified manufacturer Illinois Tool Works Inc. (NYSE:ITW) has appointed Vice Chairman Scott Santi as acting chief executive after Chairman and Chief Executive David Speer went on a medical leave.
- Sprint Nextel Corporation (NYSE:S) has been upgraded to “neutral” from “underperform” at by analysts at Robert W Baird.
- Supermarket operator The Kroger Co. (NYSE:KR) was raised to “buy” from “hold” by analysts at Jefferies Group Inc.
- Citigroup has raised fashion accessories maker Fossil, Inc. (NASDAQ:FOSL) to “buy” from “neutral.”
- United Parcel Service, Inc. (NYSE:UPS) was lowered to “neutral” from “outperform” by analysts at Robert W Baird.
- Citigroup Inc. (NYSE:C) fell more than 2 percent in early morning trade after Chief Executive Officer Vikram Pandit resigned. He will be replaced by Michael Corbat, who previously served as Citigroup’s CEO of Europe, Middle East and Africa.
- The Coca-Cola Company (NYSE:KO) reported third-quarter earnings excluding items of 51 cents per share, on revenue of $12.34 billion. Analysts had forecast earnings excluding items of 51 cents a share on $12.41 billion in revenue.
- UnitedHealth Group Inc. (NYSE:UNH) said third-quarter earnings jumped 23 percent to $1.56 billion, or $1.50 per share, from $1.27 billion, or $1.17 per share, in the year-ago period. Revenue for the quarter increased 8 percent to $27.3 billion. Analysts had expected the company to report earnings of $1.31 a share on $27.61 billion in revenue. The country’s largest health insurer also raised its full-year earnings forecast.
- PNC Financial Services (NYSE:PNC) said third-quarter profit increased 11 percent to $925 million, or $1.64 per share, from $834 million, or $1.55, a year earlier. Earnings excluding certain items came in at $1.63 a share. Analysts were looking for earnings excluding items of $1.66 a share.
- Toy company Mattel, Inc. (NASDAQ:MAT) said third quarter net income rose to $365.9 million, or $1.04 per share, from $300.8 million, or 86 cents per share, in the year-ago period. Sales increased 4 percent to about $2.08 billion. Analysts had expected earnings of 99 cents per share on $2.07 billion in sales.
- State Street Corporation (NYSE:STT) said third quarter net income on an operating basis declined to $473 million, or 99 cents a share, from $476 million, or 96 cents, in the year-ago period. Analysts were expecting earnings excluding items of 96 cents a share.
- Domino’s Pizza, Inc. (NYSE:DPZ) reported third quarter profit of $26 million, or 44 cents a share, up from a year-ago profit of $22.1 million, or 36 cents a share. Revenue came in at $378.1 million. Analysts were looking for a profit of 41 cents a share on revenue of $375 million.
- Ratings agency Standard & Poor’s downgraded the credit ratings of 15 Spanish banks on Tuesday, including the country’s largest bank Banco Santander, S.A. (NYSE:SAN) (MCE:SAN) and second largest lender Banco Bilbao Vizcaya Argentaria SA (NYSE:BBVA) (MCE:BBVA).
- Royal Bank of Scotland Group plc (NYSE:RBS) (LON:RBS) has suspended its head of rates trading in Europe and Asia Pacific, Jezri Mohideen, as the British lender investigates its alleged role in the Libor interest rate fixing scandal, the Financial Times reported on Tuesday.
- French billionaire Vincent Bollore is all set to gain a seat on the board of Vivendi SA (EPA:VIV) after his holding group raised its stake in the media conglomerate to 5 percent, from 4.41 percent at end-September.
- Spanish telecommunications group Telefonica S.A. (NYSE:TEF) (MCE:TEF) gained 1 percent after pricing the shares of its German unit in the range of 5.25 euros ($6.80) and 6.50 euros each.
- Danish drug maker Novo Nordisk A/S (NYSE:NVO) (CPH:NOVO-B) said it has submitted applications to the European Medicines Agency and the U.S. Food and Drug Administration seeking approval for its haemophilia drug Turoctocog Alfa.
- British online gaming group Sportingbet PLC (LON:SBT) has agreed the terms of a 530 million pounds ($851 million) takeover by the country’s largest bookmaker, William Hill plc (LON:WMH).
- Engineering group GKN plc (LON:GKN) reported third quarter earnings that showed little change from a year-earlier but said fourth-quarter profit will be impacted by a sluggish European automotive market.
- London-listed precious metals miner Petropavlovsk PLC (LON:POG) surged 3 percent after third quarter gold production rose 39 percent compared to the previous period.
- German drug maker Bayer AG (ETR:BAYN) (FRA:BAYN) added 1.8 percent as Bank of America Corp. named the stock as one of its preferred health-care shares.
- Investment manager Hargreaves Lansdown PLC (LON:HL) was downgraded to “underperform” from “neutral” by analysts at Credit Suisse.
- Global mining giant Rio Tinto plc (NYSE:RIO) (LON:RIO) (ASX:RIO) maintained its 2012 production guidance at 250 million tones, saying its business was performing strongly despite global volatility and falling commodity prices due to China’s uncertain economic outlook.
- Qatar prime minister Hamad Bin Jassim Bin Jabor Al Thani said that the country’s sovereign wealth fund is “seriously looking” at a potential investment in the commodities trading unit of US investment bank Morgan Stanley (NYSE:MS).
- Chinese property stocks, China Resources Land Limited (HKG:1109) and China Overseas Land & Investment Ltd. (HKG:0688), rallied in trade today after data released by property consultancies Centaline and Soufun showed a strong rebound in mainland property sales last week.
- Iron-ore miner Fortescue Metals Group Limited (ASX:FMG) has reiterated its full year production target after posting a 16 percent rise in total output during the September quarter.
- Japanese brewer Kirin Holdings Company, Limited. (TYO:2503) slid 2.4 percent after it slashed its sales target for 2015 to 2.3 trillion yen ($29.20 billion), from a previous forecast of 3 trillion, and also lowered its outlook for its Australian subsidiary.
- Wesfarmers Limited (ASX:WES) rose 1.2 percent in Sydney amid reports that the Australian conglomerate was considering spinning off a property portfolio worth around 700 million Australian dollars ($717 million).
- German logistics and mailing company Deutsche Post AG (ETR:DPW) (FRA:DPW) said the Indian arm of its express delivery unit DHL is planning to invest 100 million euros ($129.4 million) to build new warehouses and transport facilities in the country, according to a Reuters report.
- Ping An Insurance (Grp) Co of China Ltd. (HKG:2318) (SHA:601318), China’s second-largest life insurer, gained 0.9 percent in Hong Kong after reporting a 12 percent growth in premium income for September from the same period last year.
- U.S. coal producer Peabody Energy Corporation (NYSE:BTU) has been invited by the Mongolian state-owned miner, Erdenes Tavan Tolgoi Ltd to help build infrastructure at the coal-rich Tavan Tolgoi area in the remote South Gobi desert, according to a Reuters report.
- Australian telecom operator Telstra Corporation Limited (ASX:TLS) said it will resume an earlier policy of considering dividends on a half-yearly basis in fiscal 2014.
- Reliance Industries Limited (NSE:RELIANCE) (BSE:500325) ended 1.2 percent lower after HSBC Securities downgraded India’s largest private firm to “underweight” from “neutral,” a day after it reported earnings that broadly matched Street expectations.
Economic Calendar for Tuesday, October 16, 2012:
07:45 A.M. ET: ICSC-Goldman Store Sales (Week ending Saturday, October 13, 2012)
08:30 A.M. ET: Consumer Price Index (YoY) (September)
08:30 A.M. ET: Consumer Price Index (MoM) (September)
08:30 A.M. ET: Consumer Price Index Ex Food & Energy (YoY) (September)
08:30 A.M. ET: Consumer Price Index Ex Food & Energy (MoM) (September)
08:30 A.M. ET: Consumer Price Index Core s.a (September)
08:55 A.M. ET: Redbook (Week ending Saturday, October 13, 2012)
09:00 A.M. ET: Net Long-Term TIC Flows (August)
09:00 A.M. ET: Total Net TIC Flows (August)
09:15 A.M. ET: Industrial Production (MoM) (September)
09:15 A.M. ET: Capacity Utilization (September)
10:00 A.M. ET: NAHB Housing Market Index (October)
11:30 A.M. ET: 4-Week Bill Auction
11:30 A.M. ET: 52-Week Bill Auction
12:00 P.M. ET: Federal Reserve Governor Sara Bloom Raskin speaks.