OVERNIGHT MARKETS AND NEWS
December E-mini S&Ps (ESZ14 +0.24%) this morning are up +0.32% at a record high and European stocks are up +0.42% at a 2-3/4 month high after 55% of Scottish voters rejected independence and voted to remain in the UK. Yahoo rose 1.4% in pre-market trading after the company sold shares of Alibaba for $68 as Alibaba Group raised $21.8 billion in the biggest ever U.S. initial public offering. Asian stocks closed mostly higher: Japan +1.58%, Hong Kong +0.57%, China +0.69%, Taiwan +0.04%, Australia +0.32%, Singapore +0.24%, South Korea +0.23%, India -0.08%. Japan's Nikkei Stock Index soared to a 6-3/4 year high as exporters rallied after the yen tumbled to a fresh 6-year low against the dollar. Commodity prices are mixed. Oct crude oil (CLV14 -0.41%) is down -0.12%. Oct gasoline (RBV14 +0.02%) is up +0.29%. Dec gold (GCZ14 -0.29%) is down -0.36%. Dec copper (HGZ14 -0.06%) is up +0.08%. Agriculture and livestock prices are mixed as grain prices tumbled on the prospects for record global crops with Nov soybeans down -0.49% and Dec wheat down -0.87%, both at fresh 4-year lows. The dollar index (DXY00 +0.33%) is up +0.28%. EUR/USD (^EURUSD) is down -0.44%. USD/JPY (^USDJPY) is up +0.18% at a 6-year high. Dec T-note prices (ZNZ14 +0.09%) are down -0.5 of a tick at a 1-1/2 month low as a rally in stocks undercuts safe-haven demand for Treasuries.
German Aug PPI fell -0.1% m/m and -0.8% y/y, right on expectations. German producer prices have now fallen for 13 consecutive months on a year-over-year basis.
Japan Aug nationwide department store sales fell -0.3% y/y, the fifth consecutive month of year-over-year declines.
The Japan Jul all-industry activity index unexpectedly fell for a second month as it declined -0.2% m/m, weaker than expectations of unch m/m.
The Japan Jul leading index CI was revised down to 105.4 from the originally reported 106.5. The Jul coincident index was left unchanged at 109.9.
U.S. STOCK PREVIEW
The market is expecting today’s Aug leading indicators report to show another solid increase of +0.4%, adding to the sharp gain of +0.9% seen in July. There are no earnings reports today from the Russell 1000 companies. Equity conferences today include: 5th Annual Summit Internal Audit on Thu-Fri, GTC 7th CNS Partnering & Deal-Making on Thu-Fri, Imperial Capital Global Opportunities Conference on Thu, Tokyo Game Show 2014 on Fri, and Zelman & Associates Housing Summit on Fri.
OVERNIGHT U.S. STOCK MOVERS
Alibaba (BABA) was initiated with a 'Buy' at Cantor with a price target of $90.
MGM Resorts (MGM +2.41%) was downgraded to 'Hold' from 'Buy' at Argus.
Deutsche Telekom (DTEGY +1.14%) was upgraded to 'Buy' from 'Neutral' at Citigroup.
Concur (CNQR +0.31%) jumped 20% in after-hours trading after SAP acquired the company for $129 a share or $7.4 billion.
Home Depot (HD +0.95%) raised guidance on fiscal 2015 EPS view to $4.54 from $4.52, higher than consensus of $4.50.
Restoration Hardware (RH -0.49%) was initiated with a 'Buy' at CRT Capital with a price target of $90.
Molycorp (MCP -13.82%) rose over 6% in after-hours trading after Oaktree Capital reported a 9.1% passive stake in the company.
Red Hat (RHT -0.69%) reported Q2 EPS of 41 cents, better than consensus of 38 cents.
Oracle (ORCL +1.00%) reported Q1 adjusted EPS of 62 cents, weaker than consensus of 64 cents, and then Oracle CEO Larry Ellison stepped down from his post and was named executive chair of the board and Chief Technology Officer (CTO).
Dec E-mini S&Ps (ESZ14 +0.24%) this morning are up +6.50 points (+0.32%) at a record high. The S&P 500 index on Thursday climbed to a new record high and closed higher: S&P 500 +0.49%, Dow Jones +0.64%, Nasdaq +0.72%. Bullish factors included (1) carry-over optimism from Wednesday that the Fed will be in no hurry to raise interest rates after it retained its “considerable time” interest rate guidance, and (2) the -36,000 decline in weekly initial unemployment claims to 280,000, a larger drop than expectations of -10,000 to 305,000. A bearish factor was the -14.4% decline in Aug housing starts to 956,000, much weaker than expectations of -5.2% to 1.037 million, and the -5.6% drop in Aug building permits to 998,000, weaker than expectations of -1.6% to 1.040 million.
Dec 10-year T-notes (ZNZ14 +0.09%) this morning are down -0.5 of a tick at a new 1-1/2 month low. Dec 10-year T-note futures prices on Thursday tumbled to a 1-1/2 month low and closed lower. Bearish factors included (1) carry-over weakness from Wednesday’s slide after the Fed raised its year-end 2015 fed funds rate median forecast to 1.375% from a Jun estimate of 1.125%, and (2) the larger-than-expected decline in weekly jobless claims to a 2-month low. Closes: TYZ4 -10.00, FVZ4 -6.75.
The dollar index (DXY00 +0.33%) this morning is up +0.237 (+0.28%). EUR/USD (^EURUSD) is down -0.0057 (-0.44%) and USD/JPY (^USDJPY) is up +0.20 (+0.18%) at a fresh 6-year high. The dollar index on Thursday erased an early rally and closed little changed. Bullish factors included (1) carry-over support from Wednesday’s action by the FOMC to raised in its year-end 2015 fed funds rate median forecast to 1.375% from a Jun estimate of 1.125%, and (2) weakness in the yen as USD/JPY posted a 6-year high after BOJ Governor Kuroda said a stronger dollar “isn’t negative” for Japan’s economy. Closes: Dollar index -0.022 (-0.03%), EUR/USD +0.00573 (+0.45%), USD/JPY +0.316 (+0.29%).
Oct WTI crude oil (CLV14 -0.41%) this morning is down -11 cents (-0.12%) and Oct gasoline (RBV14 +0.02%) is up +0.0075 (+0.29%). Oct crude and gasoline prices on Thursday closed lower: CLV4 -1.35 (-1.43%), RBV4 -0.0082 (-0.32%). Bearish factors included (1) the stronger dollar, and (2) the larger-than-expected declines in U.S. Aug housing starts and building permits.
GLOBAL EVENT CALENDAR09/19/2014
U.S. STOCK CALENDAR09/19/2014