Barchart.com
U.S. Morning Call for Friday, April 17, 2009
U.S. Preview
- The
European DJ Stoxx 50 this morning is up +1.26% and
June S&Ps are up +0.22% (+1.90 points). The
Asia-Pacific stock markets today closed mixed:
Japan +1.74%, Hong Kong +0.12%, China -1.36%,
Taiwan -4.03%, Australia +0.3%, Singapore +0.25%,
South Korea -0.23%, Bombay +0.69%. Bullish factors
for global stocks this morning include better than
expected earnings results from Toshiba, GE and
Citigroup. Toshiba reported a loss of 250 billion
yen ($2.5 billion), which was smaller than the
company's earlier guidance for a loss of 280
billion yen. GE this morning reported earnings of
26 cents a share, down from 43 cents a year
earlier, but better than the analyst consensus of
21 cents. Citigroup this morning reported a $1.6
billion profit, ending five consecutive quarters
of losses. However, Citigroup was only able to
report a profit because of a one-time gain of $2.5
billion due to an accounting rule adopted in 2007
that allows a company to record a decline in the
value of its own debt as a unrealized gain (since
the company could theoretically buy back its debt
at a discount, which would result in a recorded
profit). San Francisco Fed President Janet Yellen
said in a speech yesterday that it was a mistake
to allow Lehman Brothers to fail because the
investment bank was systemically important and
that the bankruptcy caused the crisis to take a
"quantum leap up in terms of
seriousness." Japan's March consumer
confidence index rose to a 5-month high of 28.9
from 26.7 in February, recovering further from the
record low of 26.2 posted in December
The
"U.S. Economic 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 U.S. Economic 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 trading +1.90 points due
to better than expected earnings reports from
Citigroup and GE and higher stocks in Europe. The
US stock market yesterday fluctuated between gains
and losses through late morning when it rallied
the remainder of the day and finished higher (Dow
+1.19%, S&P 500 +1.55%, Nasdaq Composite
+2.68%).
- Bullish
factors for stock prices yesterday included (1)
good news on the labor front after US weekly
initial unemployment claims fell more-than-exected,
(2) the larger-than-expected gain in the Apr
Philadelphia Fed manufacturing index, signaling a
possible end to the deterioration in the US
manufacturing sector in the Philadelphia area at
least, (3) the 5% gain in Hewlett-Packard after it
took over the top spot in the US personal-computer
market from Dell last quarter for the first time
since 2001, according to research firm Gartner,
and (4) comments from Atlanta Fed President
Lockhart that he sees "encouraging
signs" for the US economy and predicts a
modest economic recovery in the second half of
this year.
- Bearish
factors for stock prices yesterday included (1)
weakness in real estate investment trusts after
General Growth Properties filed for for the
biggest real eatate bankruptcy in US history, (2)
weakness in homebuilders after US Mar housing
starts were weaker-than-expected and US Mar
building permits fell to a record low, along with
the report from RealtyTrac that US foreclosure
filings rose to a record in the first quarter, and
(3) the report from the IMF that the global
economy is in the grip of a "severe"
recession with "worrisome parallels" to
the Great Depression and that the recovery is
expected to be sluggish.
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Today's U.S. Market Focus
- June
10-year T-notes this morning are trading slightly
lower by -0.5 ticks due to higher stocks. June
T-note prices yesterday traded weaker the entire
day and closed down -18.5 ticks. Bearish factors
for T-note prices yesterday included (1) the much
larger-than-expected decline in US weekly initial
unemployment claims (-53,000 to 610,000 versus
expectations of -3,000 to 660,000), (2) the
stronger-than-expected April Philadelphia Fed
manufacturing index (+10.6 to -24.4 versus
expectations of +3.0 to -32.0), and (3) comments
from Atlanta Fed President Lockhart that he sees
"encouraging signs" for the US economy
and predicts a modest economic recovery in the
second half of this year. Bullish factors for
T-note prices yesterday included (1) the
larger-than-expected decline in US Mar housing
starts (-10.8% to 510,000 versus expectations of
-5.6% to 540,000), (2) the plunge in US Mar
building permits to their lowest level since
records began in 1959 (-9.0% to 513,000 versu s
expectations of -2.7% to 549,000), and (3)
indications that companies are still reluctant to
hire new workers after the US weekly continuing
unemployment claims surged to its highest level
since data began in 1967 (+172,000 to 6.022
million versus expectations of +43,000 to 5.893
million).
- The
dollar index is up +0.64 points this morning with
the dollar/yen slightly higher by +0.03 yen and
the euro/dollar sharply lower by 1.39 cents. The
euro is lower this morning due to continued
comments from some ECB members indicating they
oppose a cut in the refinancing rate below 1.00%,
which may cause the Euro-Zone economy to be the
last to recover. The dollar index yesterday closed
slightly higher. Bullish factors for the dollar
yesterday included (1) weakness in the euro after
UBS predicted that a split among the ECB's central
bankers on monetary policy will hamper efforts to
revive the European economy, (2) the prediction
from Fitch Ratings that eastern European countries
will see their recessions deepen before the
outlook improves, which may lead to credit rating
downgrades in about half of the countries, and (3)
the drop in Feb Euro-Zone industrial production
for the sixth straight month with the -18.4% y/y
fall the biggest annual decline since data began i
n 1986 and fuels concerns that Europe's recession
may deepen. Bearish factors for the dollar
yesterday included (1) reduced safe-haven demand
for dollars after the US April Philadelphia Fed
manufacturing index rose more-than-exected,
stoking optimism that the US economy is improving,
and (2) comments from ECB Executive Board member
Jose Manuel Gonzalez-Paramo that signal he does
not favor further rate cuts saying that while the
current level of 1.25% "can't be considered
the mininum limit, the margin for cutting is
moderate, I would say very moderate."
- May
crude oil prices this morning are trading -17
cents a barrel but May gasoline is up +0.36 cents
a gallon. Oil prices continue to see downward
pressure from weak demand and rising inventories.
May crude oil prices yesterday traded higher most
of the day and closed up +$0.73 a barrel. May
gasoline closed up +2.75 cents a gallon. Bullish
factors for crude oil prices yesterday included
(1) better-than-expected US economic data after
weekly US unemployment claims fell
more-than-expected and the Apr Philadelphia Fed
manufacturing index rose more-than-expected,
signaling the pace of economic decline may be
slowing, which would be positive for energy
demand, (2) a possible increase in energy demand
in China after Chinese industrial production in
Mar rose more-than-expected, and (3) the
prediction from Barclays Capital that the IEA's
recent forecast that global demand for oil will
collapse by 2.4 million bpd is excessive and
"badly calibrated." Bearish factors for
crude oil prices yesterday included (1) Macquarie
Group's cut in its 2009 crude oil price forecast
to $51.30 a barrel from $60, citing
"bulging" global stockpiles and falling
demand, and (2) the report from the API that US
fuel demand averaged 19.2 million bpd in Q1, -3.4%
less than during the same period in 2008 and the
lowest for a first quarter in 11 years
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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) GE-General
Electric (BEST earnings consensus $0.21 per share), C-Citigroup
(-0.33), BBT-BB&T Company (0.32)
Global Financial Calendar
|
Friday 4/17/2009
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|
|
|
United States
|
|
0830 ET
|
Kansas City Fed President
Thomas Hoenig speaks to the Fed’s
community-affairs conference.
|
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1000 ET
|
Preliminary Apr U.S.
University of Michigan consumer confidence
expected +1.2 to 58.5, Mar +1.0 to 57.3.
|
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1230 ET
|
Fed Chairman Ben Bernanke
speaks to the Fed’s community-affairs
conference in Washington D.C.
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Japan
|
|
0100 ET
|
Mar Japan consumer
confidence households expected +2.3 to 29.0, Feb
+0.3 to 26.7.
|
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0130 ET
|
Mar Japan nationwide
department store sales, Feb –11.5% y/y.
|
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Euro-Zone
|
|
0500 ET
|
Feb Euro-Zone trade
balance expected –5.0 billion euros, Jan
–10.5 billion euros.
|
|
0500 ET
|
Feb Euro-Zone
construction output, Jan +1.3% m/m and –9.1%
y/y.
|
|
2330 ET
|
ECB President Jean-Claude
Trichet delivers keynote speech at The Foreign
Correspondents’ Club of Japan.
|
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Canada
|
|
0700 ET
|
Mar Canadian CPI expected
+0.3% m/m and +1.4% y/y, Feb +0.7% and +1,4%
y/y.
|
|
0700 ET
|
Mar Bank of Canada CPI
core expected +0.2% m/m and +1.9% y/y, Feb +0.5%
m/m and +1.9% y/y.
|
Morning Quote Board
|
Morning Quotes (ET)
|
Last
|
Chg
|
%chg
|
Updated
|
|
US Stock Futures
|
|
S&P (Globex) (M9)
|
863.40
|
1.90
|
0.22%
|
07:11:23
|
|
DJIA (CBOT) (M9)
|
8089
|
26
|
0.32%
|
07:12:23
|
|
|
|
|
|
|
European Stocks
|
|
Europe DJ Stoxx 50
|
1997.05
|
24.90
|
1.26%
|
07:07:30
|
|
London UK FTSE Index
|
4099.64
|
46.66
|
1.15%
|
07:07:30
|
|
German Dax Index
|
4677.23
|
67.77
|
1.47%
|
07:07:34
|
|
French CAC 40 Index
|
3087.78
|
49.60
|
1.63%
|
07:07:30
|
|
|
|
|
|
|
Asian-Pacific Stocks
|
|
Japan Nikkei Index
|
8908
|
152
|
1.74%
|
03:00:15
|
|
Hong Kong Hang Seng
|
15601
|
18
|
0.12%
|
04:01:15
|
|
China CSI 300 Index
|
2651
|
-36
|
-1.36%
|
03:01:10
|
|
Taiwan TAIEX Index
|
5755
|
-242
|
-4.03%
|
01:46:00
|
|
Australian S&P 200
|
3776.7
|
1
|
0.03%
|
02:47:04
|
|
Singapore Str. Times
|
1896.56
|
4.81
|
0.25%
|
05:10:00
|
|
South Korea KOSPI 200
|
171.33
|
-0.4
|
-0.23%
|
05:04:06
|
|
Bombay Sensex 30
|
11023
|
75.69
|
0.69%
|
06:28:11
|
|
Karachi KSE-100
|
7795
|
125
|
1.63%
|
06:45:33
|
|
|
|
|
|
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US Interest Rates
|
|
10yr T-notes (CBT)(M9)
|
123.065
|
-0.005
|
-0.01%
|
07:12:23
|
|
Cash 10yr T-note Price
|
99.125
|
0.025
|
0.08%
|
07:21:31
|
|
Cash 10yr T-note Yield
|
2.821
|
-0.009
|
-0.32%
|
07:21
|
|
5yr T-note (CBT)(M9)
|
118.005
|
-0.010
|
-0.03%
|
07:12:28
|
|
Cash 5yr T-note Price
|
99.290
|
0.000
|
0.00%
|
07:18:31
|
|
Cash 5yr T-note Yield
|
1.770
|
0.000
|
0.00%
|
07:18
|
|
30-yr T-bond (CBT)(M9)
|
127.00
|
0.00
|
0.00%
|
07:12:22
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|
Cash 30yr T-bond Price
|
96.135
|
0.085
|
0.28%
|
07:15:31
|
|
Cash 30yr T-bond Yield
|
3.699
|
-0.015
|
-0.41%
|
07:15
|
|
Eurodollars (CME)(M9)
|
98.960
|
-0.005
|
-0.01%
|
07:11:37
|
|
Eurodollars (CME)(U9)
|
98.920
|
-0.005
|
-0.01%
|
07:12:18
|
|
|
|
|
|
|
Asian & European
Rates
|
|
10-yr JGBs (TSE) (M9)
|
136.81
|
0.11
|
0.08%
|
02:00:00
|
|
EuroyenTibor(SGX)(U9)
|
99.475
|
0.000
|
0.00%
|
22:13:03
|
|
Bunds (Eurex) (M9)
|
122.49
|
-0.16
|
-0.13%
|
07:07:30
|
|
Euribor (Eurex) (U9)
|
98.71
|
0.00
|
0.00%
|
4/16/2009
|
|
UK Gilts (Liffe) (M9)
|
122.86
|
-0.08
|
-0.07%
|
07:07:31
|
|
Short Stlg (Liffe) (U9)
|
98.60
|
-0.02
|
-0.02%
|
07:07:03
|
|
|
|
|
|
|
Forex
|
|
US Dollar-Japanese Yen
|
99.30
|
0.03
|
0.03%
|
07:22:30
|
|
EuroFX-US Dollar
|
1.3047
|
-0.0139
|
-1.39%
|
07:22:34
|
|
US Dollar-Swiss Franc
|
1.1658
|
0.0193
|
1.93%
|
07:22:34
|
|
British Pound-US$
|
1.4785
|
-0.0140
|
-1.40%
|
07:22:34
|
|
US$-Canadian Dlr
|
1.2109
|
0.0036
|
0.36%
|
07:22:34
|
|
Yen (Globex) (M9)
|
1.0078
|
0.0002
|
0.02%
|
07:12:25
|
|
Euro FX (Globex) (M9)
|
1.3052
|
-0.0113
|
-0.86%
|
07:12:32
|
|
SwissFranc (Globex)(M9)
|
0.8586
|
-0.0136
|
-1.56%
|
07:12:25
|
|
British Pound(Glbx)(M9)
|
1.4788
|
-0.0134
|
-0.90%
|
07:12:33
|
|
Canadian$ (Globex)(M9)
|
0.8275
|
0.0008
|
0.10%
|
07:12:33
|
|
|
|
|
|
|
Commodities
|
|
Gold (Comex) (M9)
|
869.0
|
-10.8
|
-1.23%
|
06:52:32
|
|
Silver (Comex) (K9)
|
11.985
|
-0.270
|
-2.20%
|
06:52:31
|
|
Copper (Comex) (K9)
|
213.4
|
-3.6
|
-1.64%
|
06:50:50
|
|
Crude Oil (Nymex) (K9)
|
49.81
|
-0.17
|
-0.34%
|
06:52:27
|
|
Gasoline (Nymex) (K9)
|
147.79
|
0.36
|
0.24%
|
06:43:29
|
|
Heating Oil(Nymex)(K9)
|
141.35
|
-0.83
|
-0.58%
|
06:52:10
|
|
NaturalGas(Nymex)(K9)
|
3.565
|
-0.034
|
-0.94%
|
06:51:46
|
|
Corn (CBOT) (K9)
|
384.75
|
-1.00
|
-0.26%
|
07:00:01
|
|
Soybeans (CBOT) (K9)
|
1066.75
|
8.25
|
0.78%
|
07:01:00
|
|
Wheat (CBOT) (K9)
|
525.00
|
0.25
|
0.05%
|
07:03:15
|
|
