Barchart.com
U.S. Morning Call for Wednesday, April 22, 2009
Overnight Developments
- The
European DJ Stoxx 50 this morning is down -0.19% and
June S&Ps are down -7.10 points (-0.84%). The
Asia-Pacific stock markets today closed mixed with
Japan (+0.18%), Hong Kong (-2.67%), China (-3.71%),
Taiwan (+0.08%), Australia (-0.25%), Singapore
(-2.32%), South Korea (+1.42%), India (-0.74%).
Electrolux AB, the world's second-biggest appliance
maker, jumped 16% after reporting a Q1 loss of 346
million kronor ($40.5 million), less than a 423
million-kroner loss analysts' were expecting, with
the company saying there are "early signs"
the market slump is leveling off. Commerzbank AG
rallied 7.5% and led European bank stocks higher
after the Financial Times Deutschland reported that
the bank will have to split off commercial-property
lender Eurohypo to get the European Commission's
approval for a government bailout. Axel Weber, ECB
Council member and President of Germany's Bundesbank,
said the Euro-Zone economy shows few signs of
emerging from its recession. We ber said while the
ECB has "marginal room for maneuver" on
its benchmark rate, he sees 1.00% as a
"reasonable lower bound." He added that
buying government bonds to help revive the Euro-Zone
economy is not a "desirable option,"
stating the ECB should combine longer-term loans
with a "clear signal" that rates will stay
where they are "for some time." Japan's
export slump slowed in March, ending a 4-month steak
of record drops and hinting that the recession may
have started to ease. Mar Japan exports fell -45.6%
from a year earlier, compared with Feb's record
-49.4% y/y plunge. Today's report showed that
collapsing exports resulted in Japan running a 725
billion yen trade deficit in the year ended Mar 31,
the first deficit in 28 years. Goldman Sachs today
revised their growth forecast upward for China this
year to 8.3% from an earlier estimate of 6.0%, and
next year's growth forecast to 10.9% from a previous
prediction for a 9% expansion, saying the
government's 4 trillio n yuan ($586 billion)
stimulus package will spur domestic demand and boost
investment. China's central bank deputy governor Yi
Gang said today that China's economy will continue
to recover this quarter and growth will reach the
government's 8% target in 2009
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 down -7.10 points as
Capital One and Advanced Micro Devices posted
first-quarter losses. The US stock market yesterday
overcame early weakness and closed higher (Dow
+1.63%, S&P 500 +2.13%, Nasdaq Composite
+2.22%).
- Bullish
factors for stock prices yesterday included (1) a
recovery in stock prices from early losses as most
bank stocks rallied on Treasury Secretary Geithner's
statement that the "vast majority" of US
banks have more capital than needed, (2) the
prediction from Fed Vice Chairman Kohn that the US
economy may stabilize in the second half of this
year and begin a slow rebound after a strengthening
of "fragile" financial markets, and (3) a
rally in technology stocks after Texas Instruments
reported better-than-expected Q1 earnings along with
reports that Microsoft and Yahoo! may form an
advertising partnership.
- Bearish
factors for stock prices yesterday included (1)
comments from Kansas City Fed President Hoenig that
injecting more capital into troubled financial
companies may prolong the credit crisis, (2) the
prediction from the IMF that worldwide losses tied
to bad loans and securitized assets may climb to
$4.1 trillion by the end of 2010, and (3) the
prediction from Standard & Poor's that dividends
for S&P 500 companies will probably plunge 22.6%
this year, the steepest annual decline since 1938.
- Capital
One Financial (COF) plunged over 7% in after-hours
trading after the credit-card company reported a Q1
loss of $111.9 million and added $124.1 million to
reserves for bad loans. The company also said its
previous estimate of $8.6 billion in unpaid 2009
loans was too low.
- Advanced
Micro Devices (AMD) dropped over 6% in after-hours
trading after reporting a Q1 loss of -$414 million
or 66 cents a share as sales plunged 21% after
customers cut orders amid falling PC demand. AMD
projected sales will continue to drop this quarter
and cited "limited visibility.
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Today's U.S. Market Focus
- June
10-year T-notes this morning are up +1 tick. June
T-note prices yesterday gave up early gains and
finished the day down -20 ticks. Bearish factors for
T-note prices yesterday included reduced safe-haven
demand for Treasuries after the stock market rallied
on Treasury Geithner's comments that the "vast
majority" of the nation's banks have more
capital than needed, (2) disappointment that the Fed
purchased only $7 billion of Treasuries in its
quantitative easing campaign yesterday, below market
expectations of $7.5 billion, and (3) the prediction
from UBS that the record amount of Treasuries held
by primary dealers will cause a "violent"
move to higher yields if prices begin to fall and
dealers liquidate their holdings. A bullish factor
for Treasury prices was the prediction from the IMF
that worldwide losses tied to bad loans and
securitized assets may reach $4.1 trillion by the
end of 2010, possibly increasing the demand for the
safety of Treasuries.
- The
dollar index is little changed this morning with the
dollar/yen -0.82 yen and the euro/dollar -0.01 cent.
The dollar index yesterday ended lower on the day.
Bearish factors included (1) reduced demand for the
safety of dollars after the US equity market
recovered from sharp losses, and (2) strength in the
euro after the greater-than-expected increase in the
Apr German ZEW economic sentiment survey to a 1-3/4
year high. Bullish factors for the dollar included
(1) comments from ECB Council member Noyer that
"rates can still come down, and that's probably
what will happen," indicating the ECB will cut
rates at its next policy meeting on May 7, and (2)
the statement from Luxembourg Finance Minister
Juncker that the economy of the Euro-Zone is
"stuck in a recession."
- June
crude oil prices this morning are up +8 cents a
barrel and June gasoline is -0.02 cent a gallon.
June crude oil prices yesterday rebounded from a
5-week low and closed up +$0.04 a barrel. June
gasoline closed down -0.01 cent a gallon. Bullish
factors for crude oil prices yesterday included (1)
the weaker dollar, (2) the rally in the equity
market, which recovered from early losses, and (3)
comments from Iran's OPEC governor that Iran may
back a further OPEC production cut when the cartel
meets in May. Bearish factors include (1) the
prediction from the IMF that worldwide losses tied
to distressed loans and securitized assets may reach
$4.1 trillion by the end of 2010, possibly keeping
global economies weak which will limit energy
demand, and (2) expectations that today's DOE weekly
crude oil inventories increased and added to their
highest levels since 1990. Expectations for today's
weekly DOE inventory report are for a +2.5 million
bbl climb in crude oil inve ntories, a -600,000 bbl
drawdown in gasoline stockpiles, a -1.0 million bbl
drop in distillate inventories, and a +0.6 point
increase in the refinery capacity rate to 81.0%.
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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) T-AT&T (BEST
earnings consensus $0.52 per share), AAPL-Apple ($1.10),
WFC-Wells Fargo ($0.42), QCOM-Qualcomm ($0.40), MCD-McDonalds
($0.82), MO-Altria Group ($0.39), ACL-Alcon ($1.43),
BA-Boeing ($0.92), MS-Morgan Stanley (-$0.08), KMB-Kimberly-Clark
($0.97), WLP-Wellpoint ($1.24), EBAY-EBAY ($0.34), FCX-Freeport
McMoran ($0.12), NOC-Northrop Grumman ($1.08),
GENZ-Genzyme ($1.04), YUM-Yum! Brands ($0.40), STJ-St.
Jude Medical ($0.58), TROW-T Rowe Price Group ($0.20),
NE-Noble ($1.46)
Global Financial Calendar
|
Wednesday 4/22/2009
|
|
|
|
United States
|
|
0700 ET
|
Weekly MBA mortgage
applications, previous –11% with purchase
sub-index –11% and refi sub-index –11%.
|
|
0900 ET
|
Treasury Secretary
Timothy Geithner will address the Economic Club of
Washington on the global recession and answer
questions from the audience.
|
|
1000 ET
|
Feb Federal Housing
Finance Agency house price index expected –0.7%,
Jan +1.7% m/m.
|
|
United Kingdom
|
|
0430 ET
|
Minutes from the Apr 9
Bank of England policy meeting.
|
|
0430 ET
|
Mar UK claimant count
rate expected 4.6%, Feb 4.3%. Mar jobless claims
change expected +116,000, Feb +138,400.
|
|
0430 ET
|
Feb UK avg earnings
including bonus expected +1.4% 3-mo/year over
year, Jan +1.8% 3-mo/year over year.
|
|
0430 ET
|
Feb UK avg earnings ex
bonus expected +3.4%, Jan +3.5% 3-mo/year over
year.
|
|
0430 ET
|
Feb UK ILO unemployment
rate expected 6.7%, Jan 6.5% 3-months.
|
|
0430 ET
|
Mar UK M4 money supply,
Feb +1.4% m/m and +18.7% y/y.
|
|
Euro-Zone
|
|
0300 ET
|
The European Parliament
debates financial crisis response measures,
capital requirements, credit-rating rules and an
insurance proposal.
|
|
Canada
|
|
0830 ET
|
Mar Canadian leading
indicators, Feb –1.1% m/m.
|
Morning Quote Board
|
Morning Quotes (ET)
|
Last
|
Chg
|
%chg
|
Updated
|
|
US Stock Futures
|
|
S&P (Globex) (M9)
|
840.60
|
-7.10
|
-0.84%
|
07:17:13
|
|
DJIA (CBOT) (M9)
|
7860
|
-63
|
-0.80%
|
07:17:10
|
|
|
|
|
|
|
European Stocks
|
|
Europe DJ Stoxx 50
|
1929.88
|
-3.60
|
-0.19%
|
07:12:15
|
|
London UK FTSE Index
|
3987.37
|
-0.09
|
0.00%
|
07:12:15
|
|
German Dax Index
|
4513.05
|
11.42
|
0.25%
|
07:12:24
|
|
French CAC 40 Index
|
2977.84
|
3.90
|
0.13%
|
07:12:15
|
|
|
|
|
|
|
Asian-Pacific Stocks
|
|
Japan Nikkei Index
|
8727
|
16
|
0.18%
|
03:00:15
|
|
Hong Kong Hang Seng
|
14878
|
-407
|
-2.67%
|
04:01:30
|
|
China CSI 300 Index
|
2576
|
-99
|
-3.71%
|
03:01:10
|
|
Taiwan TAIEX Index
|
5886
|
5
|
0.08%
|
01:46:01
|
|
Australian S&P 200
|
3668.2
|
-9.2
|
-0.25%
|
02:47:03
|
|
Singapore Str. Times
|
1843.41
|
-43.84
|
-2.32%
|
05:10:00
|
|
South Korea KOSPI 200
|
174.4
|
2.44
|
1.42%
|
05:04:05
|
|
Bombay Sensex 30
|
10818
|
-80.57
|
-0.74%
|
06:28:13
|
|
Karachi KSE-100
|
7574
|
-260
|
-3.32%
|
05:48:15
|
|
|
|
|
|
|
US Interest Rates
|
|
10yr T-notes (CBT)(M9)
|
122.140
|
0.010
|
0.03%
|
07:16:56
|
|
Cash 10yr T-note Price
|
98.250
|
0.010
|
0.03%
|
07:27:00
|
|
Cash 10yr T-note Yield
|
2.893
|
-0.004
|
-0.13%
|
07:26
|
|
5yr T-note (CBT)(M9)
|
117.210
|
-0.005
|
-0.01%
|
07:16:45
|
|
Cash 5yr T-note Price
|
99.165
|
0.005
|
0.02%
|
07:24:00
|
|
Cash 5yr T-note Yield
|
1.853
|
-0.003
|
-0.18%
|
07:23
|
|
30-yr T-bond (CBT)(M9)
|
125.17
|
-0.04
|
-0.10%
|
07:17:20
|
|
Cash 30yr T-bond Price
|
95.180
|
-0.050
|
-0.16%
|
07:24:30
|
|
Cash 30yr T-bond Yield
|
3.748
|
0.009
|
0.24%
|
07:24
|
|
Eurodollars (CME)(M9)
|
98.900
|
0.040
|
0.04%
|
07:17:16
|
|
Eurodollars (CME)(U9)
|
98.840
|
0.040
|
0.04%
|
07:17:16
|
|
|
|
|
|
|
Asian & European
Rates
|
|
10-yr JGBs (TSE) (M9)
|
137.21
|
0.17
|
0.12%
|
02:00:00
|
|
EuroyenTibor(SGX)(U9)
|
99.490
|
0.000
|
0.00%
|
04:32:21
|
|
Bunds (Eurex) (M9)
|
122.94
|
-0.25
|
-0.20%
|
07:12:24
|
|
Euribor (Eurex) (U9)
|
98.63
|
0.00
|
0.00%
|
4/21/2009
|
|
UK Gilts (Liffe) (M9)
|
121.63
|
-0.89
|
-0.73%
|
07:12:18
|
|
Short Stlg (Liffe) (U9)
|
98.54
|
-0.01
|
-0.01%
|
07:11:59
|
|
|
|
|
|
|
Forex
|
|
US Dollar-Japanese Yen
|
97.91
|
-0.82
|
-0.83%
|
07:27:23
|
|
EuroFX-US Dollar
|
1.2947
|
-0.0001
|
-0.01%
|
07:27:23
|
|
US Dollar-Swiss Franc
|
1.1678
|
0.0003
|
0.03%
|
07:27:23
|
|
British Pound-US$
|
1.4633
|
-0.0041
|
-0.41%
|
07:27:24
|
|
US$-Canadian Dlr
|
1.2424
|
0.0067
|
0.67%
|
07:27:21
|
|
Yen (Globex) (M9)
|
1.0231
|
0.0094
|
0.94%
|
07:17:17
|
|
Euro FX (Globex) (M9)
|
1.2928
|
0.0004
|
0.03%
|
07:17:21
|
|
SwissFranc (Globex)(M9)
|
0.857
|
0.0009
|
0.11%
|
07:17:11
|
|
British Pound(Glbx)(M9)
|
1.4611
|
-0.0054
|
-0.37%
|
07:17:02
|
|
Canadian$ (Globex)(M9)
|
0.8048
|
-0.0036
|
-0.45%
|
07:17:11
|
|
|
|
|
|
|
Commodities
|
|
Gold (Comex) (M9)
|
887.1
|
4.4
|
0.50%
|
06:57:09
|
|
Silver (Comex) (K9)
|
12.080
|
0.020
|
0.17%
|
06:57:22
|
|
Copper (Comex) (K9)
|
204.1
|
-4.6
|
-2.20%
|
06:56:35
|
|
Crude Oil (Nymex) (M9)
|
48.63
|
0.08
|
0.16%
|
06:57:20
|
|
Gasoline (Nymex) (M9)
|
141.92
|
-0.02
|
-0.01%
|
06:57:18
|
|
Heating Oil(Nymex)(M9)
|
136.36
|
-0.22
|
-0.16%
|
06:56:30
|
|
NaturalGas(Nymex)(M9)
|
3.623
|
-0.012
|
-0.33%
|
06:53:37
|
|
Corn (CBOT) (K9)
|
375.00
|
1.00
|
0.27%
|
07:17:01
|
|
Soybeans (CBOT) (K9)
|
1040.00
|
2.00
|
0.19%
|
07:17:01
|
|
Wheat (CBOT) (K9)
|
512.50
|
3.00
|
0.59%
|
07:15:18
|
|
