Dec E-mini S&Ps (ESZ16 -0.26%) are down -0.29% at a 1-1/2 week low and European stocks are down -1.28% at a 3-week low on concern over higher interest rates and rising political risks in Europe. This morning’s U.S. Nov non-farm payrolls report may boost expectations for faster Fed rate increases while a “No” vote Sunday against Italian Prime Minister Renzi’s constitutional reforms may lead to his resignation and put Italy into a period of political and market turmoil. Weakness in crude oil is also putting pressure on energy producing stocks with Jan WTI crude oil (CLF17 -1.12%) down -1.31%. Asian stocks settled lower: Japan -0.47%, Hong Kong -1.37%, China -0.90%, Taiwan -0.80%, Australia -1.02%, Singapore -0.31%, South Korea -0.63%, India -1.24%. Suppliers of Apple in Asia declined after a report Thursday from Digitimes said that Apple is reducing orders for its iPhone parts.
The dollar index (DXY00 -0.11%) is down -0.08%. EUR/USD (^EURUSD) is down -0.13%. USD/JPY (^USDJPY) is down -0.18%.
Mar 10-year T-note prices (ZNH17 +0.13%) are up +3 ticks.
Eurozone Oct PPI of +0.8% m/m and -0.4% y/y was stronger than expectations of +0.4% m/m and -1.0% y/y with the +0.8% m/m gain the largest monthly increase in 4 years.
Key U.S. news today includes: (1) Nov non-farm payrolls (expected +180,000, Oct +161,000) and Nov unemployment rate (expected unch at 4.9%, Oct -0.1 to 4.9%), (2) Nov avg hourly earnings (expected +0.2% m/m and +2.8% y/y, Oct +0.4% m/m and +2.8% y/y), (3) Fed Governor Lael Brainard delivers opening remarks at an event in Washington, D.C., (4) Nov New York ISM (Oct -0.4 to 49.2), (5) Fed Governor Daniel Tarullo speaks at the Financial Stability Conference on “Innovation, Market Structure and Financial Stability.”
Russell 1000 earnings reports today include: none.
U.S. IPO’s scheduled to price today: none.
Equity conferences today: none.
Lululemon Athletica (LULU -0.81%) was downgraded to ‘Sell’ from ‘Hold’ at Canaccord Genuity with a 12-month target price of $ 44.
Starbucks (SBUX +0.93%) dropped over 3% in after-hours trading after CEO Howard Schultz stepped down as CEO and Lieutenant Kevin Johnson will take over effective April 3, 2017.
Five Below (FIVE +1.32%) jumped over 10% in after-hours trading after it raised guidance on the low end of its full-year EPS view to $ 1.29-$ 1.32 from a prior view of $ 1.28-$ 1.32.
Ambarella (AMBA -0.21%) fell over 5% in after-hours trading after it said it sees Q4 revenue of $ 84 million-$ 87 million, below consensus of $ 90.3 million.
Fairmont Santrol Holdings (FMSA -1.14%) slid nearly 5% in after-hours trading after it announced a secondary offering of 15 million shares of common stock.
Ulta Salon (ULTA -0.81%) jumped over 6% in after-hours trading after it reported Q3 EPS of $ 1.40, better than consensus of $ 1.38.
Exxon Mobile (XOM -0.07%) was rated new ‘Market Perform’ at BMO Capital Markets with a target price of $ 78.
Zumiez (ZUMZ -1.01%) fell 2% in after-hours trading after it reported Nov comparable sales up +5.7%, weaker than estimates of +9.7%, and then said it sees Q4 EPS of 60 cents-66 cents, on the low side of estimates of 65 cents.
Equinix (EQIX -2.76%) was rated a new ‘Buy’ at Guggenheim Securities with a 12-month target price of $ 390.
SM Energy (SM +0.78%) slid nearly 4% in after-hours trading after it announced a public offering of 8 million shares of common stock.
Allegheny Technologies (ATI +1.25%) declined 3% in after-hours trading after it said it will suspend its quarterly dividend effective immediately.
Smith & Wesson Holdings (SWHC +2.79%) dropped 6% in after-hours trading after it lowered guidance on Q3 adjusted EPS to 52 cents-57 cents, below consensus of 61 cents.
CyrusOne (CONE -4.17%) was rated a new ‘Buy’ at Guggenheim Securities with a 12-month target price of $ 50.
Student Transportation (STB +1.58%) was rated a new ‘Outperform’ at Raymond James with a 12-month target price of $ 6.50.
Dec E-mini S&Ps (ESZ16 -0.26%) this morning are down -6.25 points (-0.29%) at a 1-1/2 week low. Thursday’s closes: S&P 500 -0.35%, Dow Jones +0.36%, Nasdaq -1.59%. The S&P 500 on Thursday dropped to a 1-week low and closed lower on the +17,000 increase in U.S. weekly initial unemployment claims to 269,000 (versus expectations of +2,000 to 253,000 and the most in 5 months) and interest rate concerns after the 10-year T-note yield jumped to a 17-1/2 month high of 2.49%. There was also weakness in technology stocks after Digitimes reported that Apple is reducing orders to its suppliers as momentum for the iPhone 7 fades.
Mar 10-year T-notes (ZNH17 +0.13%) this morning are up +3 ticks. Thursday’s closes: TYH7 -17.00, FVH7 -9.00. Mar 10-year T-notes on Thursday fell to a contract low and the nearest-futures Dec 2016 contract slumped to a 2-year low. T-notes were undercut by the stronger-than-expected U.S. Nov ISM manufacturing index, which expanded at the fastest pace in 5 months and bolsters the case for a Fed rate hike. T-note prices were also undercut by the increase in inflation expectations as the 10-year T-note breakeven inflation rate soared to a 2-year high.
The dollar index (DXY00 -0.11%) this morning is down -0.080 (-0.08%). EUR/USD (^EURUSD) is down -0.0014 (-0.13%). USD/JPY (^USDJPY) is down -0.21 (-0.18%). Thursday’s closes: Dollar index -0.460 (-0.45%), EUR/USD +0.0072 (+0.68%), USD/JPY -0.36 (-0.31%). The dollar index on Thursday closed lower on strength in the currencies of the oil-exporting countries of Canada and Russia versus the dollar after crude oil prices surged to a 1-1/2 month high. There was also strength in GBP/USD which rallied to a 1-3/4 month high after Brexit Secretary Davis said the UK would consider making contributions to the EU in order retain preferential access to the EU’s single market after Brexit.
Jan crude oil prices (CLF17 -1.12%) this morning are down -67 cents (-1.31%) and Jan gasoline (RBF17 -1.65%) is -0.0251 (-1.62%). Thursday’s closes: Jan crude +1.47 (+2.97%), Jan gasoline +0.0622 (+4.20%). Jan crude oil and gasoline on Thursday closed higher with Jan crude at a 1-1/2 month high. Crude oil prices were boosted by a weaker dollar and by carry-over support from OPEC’s agreement on Wednesday to cut its crude production by -1.2 million bpd to 32.5 million bpd and from Russia’s agreement to cut its crude production by 300,000 bpd.
|Friday, Dec 2|
|US||0830 ET||Nov non-farm payrolls expected +180,000, Oct +161,000. Nov private payrolls expected +170,000, Oct +142,000. Nov manufacturing payrolls expected -3,000, Oct -9,000. Nov unemployment rate expected unch at 4.9%, Oct -0.1 to 4.9%.|
|0830 ET||Nov avg hourly earnings expected +0.2% m/m and +2.8% y/y, Oct +0.4% m/m and +2.8% y/y. Nov avg weekly hours all-employees expected unch at 34.4 hours, Oct unch at 34.4 hours.|
|0845 ET||Fed Governor Lael Brainard delivers opening remarks at an event in Washington, D.C.|
|0945 ET||Nov New York ISM, Oct -0.4 to 49.2.|
|1300 ET||Fed Governor Daniel Tarullo speaks at the Financial Stability Conference on Innovation, Market Structure and Financial Stability.|
|Monday, Dec 5|
|US||0830 ET||New York Fed President William Dudley (voter) speaks on the economy and monetary policy at an event in New York.|
|0925 ET||Chicago Fed President Charles Evans (non-voter) speaks on current economic conditions and monetary policy at an event in Chicago.|
|0945 ET||Revised Nov Markit services PMI, prelim-Nov -0.1 to 54.7.|
|1000 ET||Nov ISM non-manufacturing PMI expected +0.2 to 55.0, Oct -2.3 to 54.8.|
|1100 ET||USDA weekly grain export inspections.|
|1405 ET||St. Louis Fed President James Bullard (voter) speaks at Arizona State Universitys annual economic forecast luncheon.|
|1600 ET||USDA Weekly Crop Progress.|
|Sonoco Products Co||SON US||7:50||Analyst Meeting||Y 2016|
|Aflac Inc||AFL US||9:00||Q4 2017 Guidance Call||Q4 2017|
|Illinois Tool Works Inc||ITW US||9:00||Investor Meeting||Y 2016|
|Alaska Air Group Inc||ALK US||November 2016 Sales and Revenue Release – Traffic Results||2016|
|Premier Inc||PINC US||Annual General Meeting|
|Delta Air Lines Inc||DAL US||November 2016 Sales and Revenue Release – Traffic Results||2016|