Barchart.com
U.S. Morning Call for Thursday, April 16, 2009
U.S. Preview
- The
European DJ Stoxx 50 this morning is up +0.65% and
June S&Ps are down -4.40 point (-0.52%). The
Asia-Pacific stock markets today closed mixed with
Japan (+0.14%), Hong Kong (-0.55%), China (0.00%),
Taiwan (+2.08%), Australia (+0.75%), Singapore
(-0.75%), South Korea (+0.30%), India (-2.99%).
General Growth Properties, the second-largest US
shopping-mall owner, filed for bankruptcy today
after failing to refinance more than $27 billion
of debt. General Growth, which owns more than 200
shopping malls in the US, listed $29.5 billion in
total assets and debts of $27.3 billion, making it
the largest real estate bankruptcy in US history.
Industrial production in Europe fell for the sixth
straight month in Feb as the global recession
slashed demand for manufactured goods around the
world. Feb Euro-Zone industrial production fell
-2.3% m/m and -18.4% y/y, with the -18.4% y/y
decline the biggest annual decline since the data
series began in 1986. China's economy grew a t the
slowest pace in almost 10 years in the first
quarter as the world's third-biggest economy
struggles to overcome falling export demand. GDP
in China was 6.1% in Q1, slowing from a 6.8% gain
in Q4, and the weakest rate of growth since Q4
1999. China's 4 trillion yuan ($585 billion)
stimulus plan may be starting to stimulate growth
after it reported that Mar industrial production
was up +8.3% from a year earlier and Anhui Conch
Cement, China's biggest cement maker, said that
sales jumped 15% in the first quarter from a year
earlier. Royal Bank of Scotland raised their
forecast for China's growth this year to 7% from a
previous estimate of 5%, forecasting a
"modest recovery" in the second half of
the year and UBS AG revised up its Chinese growth
forecast for this year to between 7% and 7.5% from
a previous estimate of 6.5%
The
"U.S. Ecomonmic Preview" report, which is
sent each evening and provides analysis for the next
day's key events and economic reports is now
exclusively available through CRB Trader.
The
Ecomonmic Preview provides a trader with perspective
on events before they occur the next day, thus helping
a trader to know better how to react when a report is
released.
Overnight U.S. Stock News
- June
S&Ps this morning are down -4.40 points. The
US stock market yesterday gyrated on either side
of unchanged before a late day rally left it
closing higher (Dow +1.38%, S&P 500 +1.25%,
Nasdaq Composite +0.07%).
- Bullish
factors for stock prices yesterday included (1) a
lack of inflation pressures after US Mar CPI fell
more-than-expected and posted its first annual
decline since 1955, (2) the stronger-than-expected
Apr Empire manufacturing index which rose to a
7-month high, (3) a rally in homebuilders after
the larger-than-expected climb in the April NAHB
housing market index to a 6-month high, signaling
a possible bottom in the US housing market slump,
(4) a rally in real estate investment trusts after
Goldman Sachs said the industry shows "signs
of liquidity," and (5) the Fed's Beige Book
which said it "noted a moderation in the pace
of decline" of economic conditions with some
industries "stabilizing at a low level,"
signaling that economic conditions did not
deteriorate any further last month.
- Bearish
factors for stock prices yesterday included (1)
the weaker-than-expected US Mar industrial
production which has fallen for five consecutive
months along with the plunge in Mar capacity
utilization to its lowest level since records
began in 1967, (2) HSBC's cut in its
recommendation on US equities to
"underweight," saying non-US markets may
do better if risk appetite revives, (3) the
sell-off in coal producers after Peabody Energy
tumbled -12% on poor Q1 earnings due to a lack of
demand from power plants and steelmakers, and (4)
concerns that global economic growth is still
contracting after China reported its exports fell
-17.1% y/y in Mar, for the fifth consecutive
monthly decline.
- Kraft
Foods (KFT) slid 3.5% in European trading after
UBS AG cut the world's second-biggest foodmaker to
"neutral" from "buy," citing
reduced growth forecasts due to private label risk
and international exposure.
- JPMorgan
Chase (JPM) jumped 2.6% in pre-market trading
before falling back to unchanged after reporting
Q1 EPS of 40 cents, higher than analysts'
estimates of 32 cents, as its investment-banking
revenue surged to a record.
- Starbucks
(SBUX) fell 2.5% in European trading after UBS AG
lowered its recommendation on the shares to
"neutral" from "buy," citing
valuation concerns and sluggish sales
Sponsor Message:
Today's U.S. Market Focus
- June
10-year T-notes this morning are down -12 ticks.
June T-note prices yesterday traded on both sides
of unchanged before a late rally left them closing
up +6.5 ticks. Bullish factors for T-note prices
yesterday included (1) a lack of inflation
pressures after the March CPI rose
less-than-expected and posted its first annual
decline since 1955 (-0.1% m/m and -0.4% y/y versus
expectations of +0.1% m/m and -0.1% y/y), (2) the
weaker-than-expected US March industrial
production and the plunge in capacity utilization
to its lowest level since records began in 1967
(industrial production -1.5% versus expectations
of -0.9% and capacity utilization -1.0 to a record
low 69.3% versus expectations of -0.7 to 69.6%),
and (3) increased foreign demand for US Treasuries
after net foreign purchases of Treasury notes and
bonds ross to $21.6 billion in Feb compared with
$10.7 billion in Jan. Bearish factors for T-note
prices yesterday included (1) the
larger-than-expected rise in t he April Empire
manufacturing index to a 7-month high (+23.5 to
-14.7 versus expectations of +3.2 to -35.0), (2)
the greater-than-expected gain in the Apr NAHB
housing market index to a 6-month high (+5 to 14
versus expectations of +1 to 10), and (3) the
Fed's Beige Book which said there was modest
improvement in the US economy last month with some
industries "stabilizing at a low level."
- The
dollar index is stronger this morning with the
dollar/yen -0.52 yen and the euro/dollar -0.59
cents. The dollar index yesterday closed mildly
higher. Bullish factors for the dollar yesterday
included (1) the larger-than-expected rise in the
US Feb long-term TIC flows, signaling increased
foreign demand for US assets, (2) the
greater-than-expected increase in the Apr NAHB
housing market index to a 6-month high, signaling
a possible bottom in the US housing slump, and (3)
the benign US Mar CPI which showed the first
annual decline in US consumer prices since 1955.
Bearish factors for the dollar yesterday included
(1) comments from ECB Council member Weber that
cutting the ECB's main benchmark rate below 1.00%
risks bringing the interbank lending market to a
standstill, (2) reduced demand for dollars after
the 3-month dollar Libor rate fell for the twelfth
consecutive day to a 3-month low, and (3) concerns
the US recession is deepening after US industrial
production in March fell for the fifth consecutive
month.
- May
crude oil prices this morning are up +24 cents a
barrel and May gasoline is +0.64 cent a gallon.
May crude oil prices yesterday whipsawed higher
and lower several times throughout the day in a
volatile session before crude oil finally closed
slightly lower by -$0.16 a barrel. May gasoline
closed down -1.08 cents a gallon. Bearish factors
for crude oil prices yesterday included (1) the
huge increase in weekly DOE crude oil inventories
which rose to an 18-1/2 year of 366.7 million bbl
(crude oil +5.67 million bbl versus expectations
of +1.75 million bbl), (2) OPEC's cut in its 2009
global crude oil demand forecast for the eighth
consecutive month (-430,000 bpd to 84.18 million
bpd), (3) slack US energy demand as total daily US
fuel demand over the past four weeks was 18.7
million bpd, down -5.2% from a year earlier, and
(4) concerns that US energy demand will remain
weak or even shrink further after US Mar
industrial production fell for the fifth
consecutive month and March capacity utilization
tumbled to its lowest level since records began in
1967. Bullish factors for crude oil prices
yesterday included (1) the larger-than-expected
declines in weekly DOE gasoline and distillate
inventories (gasoline -944,000 bbl versus
expectations of -500,000 bbl and distillates -1.17
million bbl versus expectations of -1.0 million
bbl), and (2) the rally in the stock market, which
provides some optimism that the US econonmy will
recover from recession and lead to stronger energy
demand
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Today's U.S. Earnings Reports
Earnings
reports (confirmed releases for companies with market
caps above $5.0 bln listed by mkt cap) GOOG-Google
(BEST earnings consensus $4.97 per share),
JPM-JPMorgan Chase (0.32), BAX-Baxter International
(0.81), ITW-Illinois Tool Works (0.13), BIIB-Biogen
Idec (1.00), PPG-PPG Industries (0.13), SHW-Sherwin-Williams
(0.21), PH-Parker Hannifin (0.45), PBCT-People's
United Financial (0.10), LUV-Southwest Airlines
(0.00), APH-Amphenol (0.40)
Global Financial Calendar
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Thursday 4/16/2009
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United States
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0830 ET
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Weekly unemployment
claims expected +4,000 to 658.000, previous
–20,000 to 654,000. Weekly continuing claims
expected +53,000 to 5.893 million, previous
+95,000 to 5.840 million.
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0830 ET
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Mar housing starts
expected –7.4% to 540,000, Feb +22.2% to
583,000. Mar building permits expected –2.7%
to 549,000, Feb +8.3% to 564,000.
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1000 ET
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Apr Philadelphia Fed
manufacturing index expected +3.0 to –32.0,
Mar +6.3 to –35.0.
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1300 ET
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Atlanta Fed President
Dennis Lockhart speaks at a conference at the
Levy Economics Institute in New York on the
topic entitled “Meeting the Challenges of
Financial Crisis.”
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2000 ET
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San Francisco Fed
President Janet Yellen speaks on the state of
the U.S. and world economies at a conference at
the Levy Economics Institute in New York.
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2200 ET
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Dallas Fed President
Richard Fisher speaks on the US economy and the
central bank’s response at a forum hosted by
Tsinghua University in Beijing.
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Japan
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0200 ET
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Revised Mar Japan machine
tool orders, previous –84.5% y/y
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1950 ET
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Feb Japan tertiary index
expected –0.6% m/m, Jan +0.4% m/m.
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Euro-Zone
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0400 ET
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Mar Euro-Zone CPI
expected +0.4% m/m and +0.6% y/y. Mar core CPI
expected 1.4% y/y, previous 1.7% y/y.
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0500 ET
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Feb Euro-Zone industrial
production expected –2.5% m/m and –18.0%
y/y, Jan –3.5% m/m and –17.3% y/y.
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2300 ET
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ECB President Jean-Claude
Trichet delivers keynote speech at the annual
plenary session of the Research Institute of
Japan.
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Canada
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0830 ET
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Feb Canadian
manufacturing shipments expected +3.3% m/m, Jan
–5.4% m/m.
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Morning Quote Board
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Morning Quotes (ET)
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Last
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Chg
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%chg
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Updated
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US Stock Futures
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S&P (Globex) (M9)
|
844.10
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-4.40
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-0.52%
|
07:08:06
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DJIA (CBOT) (M9)
|
7946
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-34
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-0.43%
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07:08:18
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European Stocks
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Europe DJ Stoxx 50
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1950.29
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12.54
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0.65%
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07:03:30
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London UK FTSE Index
|
3998.19
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29.79
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0.75%
|
07:03:30
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German Dax Index
|
4581.86
|
32.07
|
0.70%
|
07:03:36
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French CAC 40 Index
|
3010.97
|
25.23
|
0.85%
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07:03:30
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Asian-Pacific Stocks
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Japan Nikkei Index
|
8755
|
12
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0.14%
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03:00:13
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Hong Kong Hang Seng
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15583
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-87
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-0.55%
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04:01:30
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China CSI 300 Index
|
2687
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0
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0.00%
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03:01:08
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Taiwan TAIEX Index
|
5997
|
122
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2.08%
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01:46:00
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Australian S&P 200
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3775.7
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28.2
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0.75%
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02:47:03
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Singapore Str. Times
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1891.75
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-14.24
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-0.75%
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05:10:00
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South Korea KOSPI 200
|
171.73
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0.52
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0.30%
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05:04:07
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Bombay Sensex 30
|
10947
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-337.33
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-2.99%
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06:28:13
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Karachi KSE-100
|
7670
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-137
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-1.75%
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05:49:30
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US Interest Rates
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10yr T-notes (CBT)(M9)
|
123.135
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-0.120
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-0.30%
|
07:08:32
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Cash 10yr T-note Price
|
99.190
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-0.090
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-0.28%
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07:18:00
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Cash 10yr T-note Yield
|
2.797
|
0.033
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1.19%
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07:17
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5yr T-note (CBT)(M9)
|
118.050
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-0.070
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-0.18%
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07:08:36
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Cash 5yr T-note Price
|
100.015
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-0.060
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-0.19%
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07:08:00
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Cash 5yr T-note Yield
|
1.740
|
0.040
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2.33%
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07:07
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30-yr T-bond (CBT)(M9)
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127.10
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-0.20
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-0.48%
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07:08:35
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Cash 30yr T-bond Price
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96.195
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-0.145
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-0.47%
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07:12:30
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Cash 30yr T-bond Yield
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3.688
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0.026
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0.70%
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07:12
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Eurodollars (CME)(M9)
|
98.955
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-0.015
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-0.02%
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07:01:04
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Eurodollars (CME)(U9)
|
98.935
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-0.020
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-0.02%
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07:01:10
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Asian & European
Rates
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10-yr JGBs (TSE) (M9)
|
136.70
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-0.24
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-0.18%
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02:00:00
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EuroyenTibor(SGX)(U9)
|
99.480
|
0.000
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0.00%
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04:25:10
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Bunds (Eurex) (M9)
|
122.43
|
-0.51
|
-0.41%
|
07:03:34
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Euribor (Eurex) (U9)
|
98.71
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-0.03
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-0.03%
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05:52:46
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UK Gilts (Liffe) (M9)
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122.47
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-0.22
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-0.18%
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07:03:30
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Short Stlg (Liffe) (U9)
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98.59
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-0.03
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-0.03%
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07:03:12
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Forex
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US Dollar-Japanese Yen
|
98.85
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-0.52
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-0.53%
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07:18:35
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EuroFX-US Dollar
|
1.3168
|
-0.0059
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-0.59%
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07:18:35
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US Dollar-Swiss Franc
|
1.1492
|
0.0064
|
0.64%
|
07:18:37
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British Pound-US$
|
1.4860
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-0.0138
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-1.38%
|
07:18:36
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US$-Canadian Dlr
|
1.2067
|
0.0035
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0.35%
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07:18:37
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Yen (Globex) (M9)
|
1.0134
|
0.0045
|
0.45%
|
07:08:27
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Euro FX (Globex) (M9)
|
1.3157
|
-0.0026
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-0.20%
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07:08:28
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SwissFranc (Globex)(M9)
|
0.8707
|
-0.004
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-0.46%
|
07:08:26
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British Pound(Glbx)(M9)
|
1.485
|
-0.011
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-0.74%
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07:08:30
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Canadian$ (Globex)(M9)
|
0.8287
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-0.0003
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-0.04%
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07:08:35
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Commodities
|
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Gold (Comex) (M9)
|
890.4
|
-3.1
|
-0.35%
|
06:48:33
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Silver (Comex) (K9)
|
12.680
|
-0.120
|
-0.94%
|
06:48:19
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Copper (Comex) (K9)
|
217.2
|
-2.8
|
-1.25%
|
06:48:21
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Crude Oil (Nymex) (K9)
|
49.49
|
0.24
|
0.49%
|
06:48:36
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Gasoline (Nymex) (K9)
|
145.32
|
0.64
|
0.44%
|
06:48:33
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Heating Oil(Nymex)(K9)
|
140.77
|
0.67
|
0.48%
|
06:17:29
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NaturalGas(Nymex)(K9)
|
3.676
|
-0.017
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-0.46%
|
06:42:51
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Corn (CBOT) (K9)
|
384.25
|
-0.25
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-0.07%
|
07:00:33
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Soybeans (CBOT) (K9)
|
1039.50
|
4.50
|
0.43%
|
07:03:08
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Wheat (CBOT) (K9)
|
516.00
|
0.75
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0.15%
|
07:03:08
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