U.S. Preview
- The European DJ Stoxx 50 index this morning is trading +1.09% on lower oil prices (-45 cents) and better-than-expected earnings reports from Siemens, AcelorMittal and Matsushita Electric Industrial Company. However, European stocks were undercut by today's report that the European July consumer confidence index compiled by the European Commission fell by -5.3 points to 89.5, the largest monthly drop since the September 11, 2001 terrorist attacks. Asia-Pacific stocks today closed mostly higher: Japan +1.58%, Hong Kong +1.94%, China -0.73%, Taiwan +0.80%, Australia +1.84%, Singapore +1.35%, South Korea +0.96%, Bombay +3.59%.
- Mortgage applications – This morning's MBA mortgage applications report showed sharp declines. The declines were not surprising given that the 30-year mortgage rate in the week covering today’s MBA report (July 25) soared by 37 bp to an 11-month high of 6.63%. The refinancing index today fell to a new 7-1/2 year low and the purchases sub-index fell to a new 5-1/2 year low.
- ADP employment report – Today’s July ADP employment report is expected to show a decline of –60,000 in US jobs, adding to the decline of –79,000 seen in June. The ADP report could offer some useful information ahead of Friday’s payroll report. The market is expecting Friday’s July payroll report to show a decline of –75,000, adding to the –62,000 decline seen in June. Payrolls have now fallen for six consecutive months by a total of 438,00. The correlation seen between the ADP report and the Commerce Department’s payroll series over the past 5 years, however, is not particularly strong at 0.44. Recently, the ADP report has suggested a much better labor market situation than the Commerce Department’s report. The ADP report showed a decline of –79,000 jobs in June, but the ADP report showed gains in four out of the first five months of this year when the Commerce Department’s payroll series showed declines in every month. The recent ADP reports have been as follow s: Jan +119,000, Feb –18,000, March +3,000, April +13,000, May +25,000, June –79.000.
Sponsor Message:
Our Readers Could Have Turned $5,000 Into $1 million in Just Over 5 Years
You could be apart of a small group of investors who have a chance to reap $1 million in profits.
Will it take 5 years? I can’t answer that... It depends on your risk factor.
But I can guarantee you’ll have at least 12 opportunities to double your money just over the year ahead.
Click Here to find out how!
Overnight U.S. Stock News
- September S&Ps this morning are trading +2.00 points on lower oil prices and on some strength in the financial sector after the SEC extended its ban on naked short selling for Fannie/Freddie and 17 brokerage firms. The US stock market yesterday rallied sharply and closed just under its high (Dow +2.39%, S&P 500 +2.34%, Nasdaq Composite +2.45%).
- Bullish factors for stock prices yesterday included (1) the unexpected rise in US consumer confidence in July, (2) the continued sell-off in crude oil prices, which fell -$2.54 a barrel yesterday to a 2-1/2 month low, and (3) speculation that US banks and financial firms may be near the end of the subprime mortgage crisis after Merrill Lynch liquidated $30.6 billion of collateralized debt obligations (CDOs) at a fifth of their face value, thereby eliminating much of their exposure to the toxic securities that accounted for about $27 billion of the total $41 billion in writedowns Merrill has taken over the past year.
- Bearish factors for stock prices yesterday included (1) the biggest decline in US home prices in May since S&P CaseShiller began collecting data in 2001 as US home prices have now fallen every month since Jan 2007, indicating no bottom yet in the beleagured housing market, and (2) the failure in the World Trade Organization (WTO) trade talks in Switzerland as the US accused China and India of refusing to open their markets to foreign competition.
- Metlife (MET) plunged -9.6% in after-hours trading yesterday as the biggest US life insurer said Q2 operating profit was $1.30 a share, far below analysts' estimates of $1.51 a share.
- OfficeMax (OMX) is down -3.4% in European trading after the company reported a Q2 loss of $894 million due to an asset write-down.
- Wyeth (WYE) plunged 12% in European trading after a study linked the company's experimental Alzheimer's drug to brain swelling as a side effect.
- Freddie Mac is up +3.3% and Fannie Mae is up +2.6% in European trading this morning after the SEC extended its ban on naked short selling on Fannie and Freddie and 17 brokerage firms.
Sponsor Message:
SUCCESSFUL TRADING STARTS HERE!
Also one of the best educational tools in the industry today!
In the uncertain world of futures trading, CRB's TrendTrader will signal major trends whenever and wherever they occur. TrendTrader analyzes all of the major markets.
TrendTrader provides more valuable market timing information than you're likely to receive from any other resource.
Click below to start your free trial today.
Today's U.S. Market Focus
- September 10-year T-notes this morning are trading +0.5 tick. September T-note prices yesterday fell 5 ticks. Bearish factors for T-note prices yesterday included (1) reduced demand for the safety of Treasuries after the stock market rallied sharply, (2) speculation the end may be near for banks and financial firms from the mortgage crisis after Merrill Lynch liquidated over $30 billion of CDOs at a fifth of their face value, (3) the unexpected increase in July US consumer confidence (+0.9 to 51.9 versus expectations of -0.4 to 50.0), and (4) concern of extra Treasury supply coming to market after the Treasury said it needs to borrow $171 billion in the three months to Sep 30, $59 billion, which was more than it predicted in April.
- The dollar/yen is down -0.31 yen this morning and the euro/dollar is virtually unchanged. The euro gave up earlier gains after the weak European consumer confidence report was released. The dollar index yesterday rallied sharply and closed at a 1-month high. Bullish factors for the dollar yesterday included (1) speculation that the worst of the credit crisis may be over after Merrill Lynch liquidated over $30 billion of CDOs that have caused most of the firm's losses for $6.7 billion and said it would raise $8.5 billion in a sale of stock, and (2) the unexpected increase in July US consumer confidence. Bearish factors for the dollar yesterday included (1) the biggest ever drop in US home prices in May since S&P/CaseShiller began collecting data in 2001, and (2) fears the ECB may raise interest rates again after July German CPI stayed at a 12-year high and French June producer prices soared to their highest level since data began in January 2000.
- September crude oil prices this morning are trading -45 cents a barrel and September gasoline is trading -0.97 cents a gallon. September crude oil prices yesterday sold off and closed -$2.54 a barrel and September gasoline closed -6.08 cents a gallon. September crude and gasoline both posted 2-1/2 month lows yesterday. Bearish factors yesterday included (1) comments from OPEC President Khelil that crude oil prices are "abnormal" and OPEC shouldn't cut output in order to ensure adequate supply and that if the dollar strengthened and political tensions eased in the Middle East then crude oil prices would drop to $70 to $80 a barrel, (2) the rally in the dollar to a 1-month high, and (3) concerns that gasoline inventories will rise for a fifth straight week in today's DOE inventory report. A bullish factor for crude oil prices yesterday was the action taken by Royal Dutch Shell, Europe's biggest oil producer, in declaring force majeure on Bonny crude deliveries from Ni geria because of damage caused to pipelines by Nigerian militants. The market consensus for today's weekly DOE report is for a -1.3 million bbl decline in crude oil inventories, a +350,000 bbl rise in gasoline stockpiles, a +2.05 million bbl rise in distillate inventories and an unchanged refinery operating rate of 87.1%.
Sponsor Message:
Complimentary Market Forecasts!
VantagePoint's market forecasts are nearly 80% accurate.
Take a look at actual VantagePoint forecasts, and see for yourself
the difference VantagePoint forecasts will make in your trading!
Click here to see a recent forecast now.
Today's U.S. Earnings Reports
Earnings reports (confirmed releases for companies with market caps above $10.0 bln listed by mkt cap): DIS-Disney (BEST earnings consensus $0.60 per share), CMCSA-Comcast (0.23), GLW-Corning (0.49), HES-Hess (2.74), SO-Southern Co. (0.57), PRU-Prudential Financial (1.84), EOG-EOG Resources (2.37), FSLR-First Solar (0.58), ESRX-Express Script (0.72), AMT-American Tower (0.12), SYMC-Symantec (0.35), AGN-Allergan (0.63), AVP-Avon Products (0.48), RAI-Reynolds American (1.18), LVS-Las Vegas Sands (0.13), MUR-Murphy Oil (2.18), NBL-Noble Energy (2.05), CMI-Cummins (1.23), CG-Carolina Group (1.41), EQR-Equity Residential (0.14), CLF-Cleveland-Cliffs (1.91), SBUX-Starbucks (0.18), CAM-Cameron International (0.62), KIM-Kimco Realty (0.55), OI-Owens-Illinois (1.22), GGP-General Groth Properties (0.05), NLY-Annaly Capital Management (0.61), UNM-Unum Group (0.59)
| Wednesday 7/30/2008 | |
|---|---|
| United States | |
| 0700 ET | Weekly MBA mortgage applications, previous –6.2%, refi sub-index –5.6%, purchases sub-index –6.7%. |
| 0815 ET | Jul ADP employment change expected –60,000, Jun –79,000. |
| 0900 ET | Treasury announces amounts of 10-year T-notes and 30-year T-bonds to be auctioned on August 6 and 7 (expected $17 billion 10-year T-notes and $10 billion 30-year T-bonds). |
| Euro-Zone | |
| 0400 ET | Jul Euro-Zone Bloomberg retail PMI, Jun –9.1 to 44.0. |
| 0500 ET | Jul Euro-Zone business climate indicator expected –0.16 to –0.02, Jun –0.40 to 0.14. |
| 0500 ET | Jul Euro-Zone consumer confidence expected –1 to –18, Jun –2 to –17. |
| Germany | |
| 0400 ET | Jul German Bloomberg retail PMI, Jun –11.7 to 44.9. |
| France | |
| 0400 ET | Jul French Bloomberg retail PMI expected +0.2 to 48.9, Jun –10.9 to 48.7. |
| Canada | |
| 0830 ET | Jun Canadian industrial product prices expected +1.0%, May +0.6%. Jun raw materials price index expected +3.5%, May +3.1%. |
| United Kingdom | |
| 1901 ET | UK Jul Gfk consumer confidence survey expected –37, Jun –34. |
Morning Quote Board
Morning Quotes (ET) Last Chg %chg Updated US Stock Futures S&P (Globex) (U8) 1263.70 2.00 0.16% 06:59:42 DJIA (CBOT) (U8) 11394 21 0.18% 06:56:34 European Stocks Europe DJ Stoxx 50 2871.07 30.97 1.09% 06:54:45 London UK FTSE Index 5390.10 70.90 1.33% 06:54:46 German Dax Index 6451.46 52.66 0.82% 06:54:50 French CAC 40 Index 4375.20 54.71 1.27% 06:54:30 Asian-Pacific Stocks Japan Nikkei Index 13368 208 1.58% 03:00:15 Hong Kong Hang Seng 22691 433 1.94% 04:10:30 China CSI 300 Index 2884 -21 -0.73% 03:01:07 Taiwan TAIEX Index 7070 56 0.80% 01:46:01 Australian S&P 200 4936.7 89.3 1.84% 02:47:04 Singapore Str. Times 2925.5 38.94 1.35% 05:10:07 South Korea KOSPI 200 201.82 1.92 0.96% 02:02:18 Bombay Sensex 30 14287 495.67 3.59% 06:28:12 Karachi KSE-100 10853 405 3.87% 04:15:21 US Interest Rates 10yr T-notes (CBT)(U8) 114.040 0.005 0.01% 06:59:34 Cash 10yr T-note Price 98.220 0.000 0.00% 07:09:00 Cash 10yr T-note Yield 4.038 0.000 0.00% 07:08 5yr T-note (CBT)(U8) 110.260 -0.010 -0.02% 06:59:00 Cash 5yr T-note Price 100.015 0.005 0.02% 07:08:30 Cash 5yr T-note Yield 3.365 -0.003 -0.10% 07:08 30-yr T-bond (CBT)(U8) 114.29 0.00 0.00% 06:58:50 Cash 30yr T-bond Price 96.020 0.015 0.05% 07:09:00 Cash 30yr T-bond Yield 4.621 -0.003 -0.06% 07:08 Eurodollars (CME)(U8) 97.110 0.005 0.01% 06:59:27 Eurodollars (CME)(Z8) 96.920 0.015 0.02% 06:58:30 Asian & European Rates 10-yr JGBs (TSE) (U8) 136.45 0.22 0.16% 02:00:00 EuroyenTibor(SGX)(U8) 99.150 0.000 0.00% 05:00:00 Bunds (Eurex) (U8) 111.97 0.33 0.30% 06:54:47 Euribor (Eurex) (U8) 95.00 0.00 0.00% 06:31:20 UK Gilts (Liffe) (U8) 106.98 0.36 0.34% 06:54:44 Short Stlg (Liffe) (U8) 94.18 0.02 0.02% 06:52:46 Forex US Dollar/Japanese Yen 107.80 -0.31 -0.29% 07:09:52 EuroFX / US Dollar 1.5591 0.0002 0.02% 07:09:50 SwissFranc/US Dollar 1.0465 -0.0004 -0.04% 07:09:48 British Pound (per USD) 1.9795 0.0006 0.06% 07:09:49 Canadian Dlr (perUSD) 1.0229 -0.0009 -0.09% 07:09:15 Yen (Globex) (U8) 0.9301 0.0025 0.25% 06:59:41 Euro FX (Globex) (U8) 1.5547 0 0.00% 06:59:44 SwissFranc (Globex)(U8) 0.9553 -0.0019 -0.20% 06:59:46 British Pound(Glbx)(U8) 1.9729 0.0011 0.06% 06:59:51 Canadian$ (Globex)(U8) 0.9769 0.0018 0.18% 06:59:44 Commodities Gold (Comex) (Z8) 917.9 -8.5 -0.92% 06:39:43 Copper (Comex) (U8) 355.7 -3.4 -0.95% 06:38:57 Crude Oil (Nymex) (U8) 121.74 -0.45 -0.37% 06:39:36 Gasoline (Nymex) (U8) 300.35 -0.97 -0.32% 06:36:09 Heating Oil(Nymex)(U8) 349.31 -0.54 -0.15% 06:39:03 NaturalGas(Nymex)(U8) 9.09 -0.04 -0.44% 06:38:12
Copyright © 2008, All rights reserved. The information contained herein is derived from public sources believed to be reliable but is not guaranteed as to its accuracy or completeness. No responsibility is assumed for the use of this material and no express or implied warranties nor guarantees are made. Nothing contained herein should be construed as an offer to buy or sell, or as a solicitation to buy or sell, any securities or derivative instruments.
