Mar E-mini S&Ps (ESH17 -0.29%) are down -0.28% and European stocks are down -0.09% on negative fallout from President-elect Trump’s press conference Wednesday that lacked specifics and details on any economic-stimulus plans. The dollar index (DXY00 -0.98%) is down -0.76% at a 4-week low and sold-off as well as a lack of details on infrastructure investment from Trump spurred liquidation of long dollar positions. The weak dollar boosted metals prices with Feb COMEX gold (GCG17 +0.75%) up +0.68% at a 1-1/2 month high and Mar COMEX copper (HGH17 +0.86%) up +0.61% at a 1-month high. Crude oil prices also moved higher on the weak dollar with Feb WTI crude (CLG17 +1.19%) up +1.15%. Crude prices also garnered support on signs that OPEC is keeping its pledge to cut oil production when Saudi Energy Minister Khalid al-Falih said “our production now is below 10 million bpd and we are going the extra mile to lead out colleagues within and outside OPEC to make sure the market sees that there is serious action.” Losses in European stocks were contained after Eurozone Nov industrial production rose more than expected. Asian stocks settled mostly lower: Japan -1.19%, Hong Kong -0.46%, China -0.56%, Taiwan +0.69%, Australia -0.08%, Singapore -0.26%, South Korea +0.67%, India +0.39%. Asian stock markets fell with China’s Shanghai Composite and Japan’s Nikkei Stock index both at 1-week lows as drug makers and health-care stocks sold-off after President-elect Trump on Wednesday criticized the pharmaceutical industry and said he would force the industry to bid for government business. Japanese exporters moved lower as well after the yen rose to a 1-month high against the dollar, which reduces exporters’ earnings prospects.
The dollar index (DXY00 -0.98%) is down -0.76% at a 4-week low. EUR/USD (^EURUSD) is up +0.76% at a 4-week high. USD/JPY (^USDJPY) is down -1.02% at a 1-month low.
Mar 10-year T-note prices (ZNH17 +0.23%) are up +10 ticks.
The ECB Governing Council lowered the ELA ceiling for Greek banks to 46.5 billion euros from 50.7 billion euros, which signals an improvement in the liquidity situation of Greek banks.
Eurozone Nov industrial production rose +1.5% m/m and +3.2% y/y, stronger than expectations of +0.6% m/m and +1.6% y/y with the +3.2% y/y gain the biggest year-on-year increase in 10 months.
China Dec new yuan loans rose 1.04 trillion yuan, stronger than expectations of 676.8 billion yuan. Dec aggregate financing rose 1.63 trillion yuan, stronger than expectations of 1.30 trillion yuan.
Key U.S. news today includes: (1) weekly initial unemployment claims (expected +20,000 to 255,000, previous -28,000 to 235,000) and continuing claims (expected -28,000 to 2.084 million, previous +10,000 to 2.112 million), (2) Dec import price index (expected +0.7% m/m and +1.8% y/y, Nov -0.3% m/m and -0.1% y/y), (3) Philadelphia Fed President Patrick Harker (voter) speaks at an event in Malvern, Pennsylvania, (4) Chicago Fed President Charles Evans (voter) and Atlanta Fed President Dennis Lockhart (non-voter) speak on the economic outlook and monetary policy at a meeting of the American Council of Life Insurers in Naples, FL, (5) Treasury auctions $ 12 billion of 30-year T-bonds, (6) Dallas Fed President Robert Kaplan (voter) will speak at the Dallas Regional Chamber Annual Meeting, (7) Dec monthly budget statement (expected -$ 26.0 billion, Nov -$ 136.7 billion), (8) Fed Chair Janet Yellen addresses a town hall meeting with educators and will speak briefly about the mission and responsibilities of the Federal Reserve System. Q&A will follow, (9) USDA weekly Export Sales, (10) USDA Jan WASDE crop production, (11) USDA Quarterly grain stocks.
Russell 1000 earnings reports today include: Delta Airlines (consensus $ 0.82).
U.S. IPO’s scheduled to price today: Gores Holdings II (GSHTU).
Equity conferences this week include: J.P. Morgan Healthcare Conference on Mon-Thu, Evercore ISI Utility Conference on Thu.
Adobe Systems (ADBE +0.67%) was downgraded to ‘Hold’ from ‘Buy’ at Pivotal Research Group LLC with a 12-month price target of $ 104.
U.S. Steel (X -0.85%) was downgraded to ‘Neutral’ from ‘Outperform’ at Credit Suisse with a price target of $ 30,
Disney (DIS +0.98%) was downgraded to ‘Sell’ from ‘Hold’ at Pivotal Research Group LLC with a 12-month price target of $ 85.
SunTrust Banks (STI +0.59%) was upgraded to ‘Strong Buy’ from ‘Market Outperform’ at Vining Sparks.
Boeing (BA +0.21%) was rated a new ‘Underperform’ at RBC Capital Markets with a 12-month target price of $ 136 saying Boeing’s market position is inferior as it is shut out of the next generation of fighter and bomber plane platforms.
Raytheon (RTN -0.25%) was rated a new ‘Outperform’ at RBC Capital Markets with a 12-month target price of $ 180.
Callaway Golf (ELY -1.49%) jumped nearly 6% in after-hours trading after it purchased Ogio International for $ 75.5 million.
KB Home (KBH +2.15%) rallied nearly 3% in after-hours trading after it reported Q4 revenue of $ 1.19 billion, higher than consensus of $ 1.14 billion.
Century Aluminum (CENX -0.33%) rose nearly 2% in after-hours trading after people with knowledge of the matter said the U.S. is said to prepare a complaint with the WTO against China on subsidies to its domestic aluminum producers that is suppressing global aluminum prices.
Zendesk (ZEN +2.44%) climbed 3% in after-hours trading after it was rated a new ‘Outperform’ at Cowen with a price target of $ 30.
Kosmos Energy Ltd (KOS +1.00%) dropped 5% in after-hours trading after the two top holders of its stock, Blackstone and Warburg Pincus, offered to sell 30 million shares of their holdings of Kosmos.
World Wrestling Entertainment (WWE +0.05%) gained 1% in after-hours trading after it was rated a new ‘Buy’ at Guggenheim Securities.
Applied Optoelectronics (AAOI -0.66%) surged 18% in after-hours trading after it said preliminary Q4 adjusted EPS will be 77 cents-82 cents, higher than a November estimate of 46 cents-51 cents.
Mar E-mini S&Ps (ESH17 -0.29%) this morning are down -6.25 points (-0.28%). Wednesday’s closes: S&P 500 +0.14%, Dow Jones +0.35%, Nasdaq +0.21%. The S&P 500 on Wednesday closed higher on strength in energy producer stocks after crude oil prices rose 2.81% and on reduced interest rate concerns after the 10-year T-note yield fell to a 5-week low. Stocks were undercut by disappointment that President-elect Trump did not provide specifics on any of his fiscal-stimulus plans. There was also weakness in pharmaceutical and biotech stocks after President-elect Trump said he would force drug makers to bid for government business to save the government money.
Mar 10-year T-notes (ZNH17 +0.23%) this morning are up +10 ticks. Wednesday’s closes: TYH7 +1.50, FVH7 +0.25. Mar 10-year T-notes on Wednesday closed higher on very strong demand for the Treasury’s $ 20 billion 10-year T-note auction that had a 2.58 bid-to-cover ratio, higher than the 12-auction average of 2.39, and on the fact that foreign bidders took a hefty 70.5% of the auction.
The dollar index (DXY00 -0.98%) this morning is down -0.77 (-0.76%) at a 4-week low. EUR/USD (^EURUSD) is up +0.0080 (+0.76%) at a 4-week high. USD/JPY (^USDJPY) is down -1.18 (-1.02%) at a 1-month low. Wednesday’s closes: Dollar index -0.28 (-0.27%), EUR/USD +0.0028 (+0.27%), USD/JPY -0.36 (-0.31%). The dollar index on Wednesday closed lower on (1) reduced dollar interest rate differentials after a decline in 10-year T-note yields, and (2) disappointment that President-elect Trump did not discuss his administration’s fiscal stimulus plans at his press conference.
Feb WTI crude oil prices (CLG17 +1.19%) this morning are up +60 cents (+1.15%) and Feb gasoline (RBG17 +1.25%) is +0.0194 (+1.22%). Wednesday’s closes: Feb crude +1.43 (+2.81%), Feb gasoline +0.0478 (+3.09%). Feb crude oil and gasoline on Wednesday closed higher on signs of lower OPEC crude output after Saudi Arabia was said to cut Feb crude oil sales to China and southern Asian nations. In addition, the weekly EIA report contained bullish news since it showed (1) strong foreign demand for U.S. crude after U.S. crude exports jumped 6% in the week ended Jan 6 to 727,000 bpd, the highest since data began in 1993, and (2) strong refinery demand for crude after U.S. refiners used 17.1 million bpd of crude last week, the most since data began in 1989. Crude oil prices were undercut by the +2.0% increase in U.S. crude production to an 8-1/2 month high and by the +4.097 million bbl increase in EIA crude inventories, more than expectations of +1.5 million bbl.
|Thursday, Jan 12|
|US||0830 ET||Weekly initial unemployment claims expected +20,000 to 255,000, previous -28,000 to 235,000. Weekly continuing claims expected -28,000 to 2.084 million, previous +10,000 to 2.112 million.|
|0830 ET||Dec import price index expected +0.7% m/m and +1.8% y/y, Nov -0.3% m/m and -0.1% y/y.|
|0830 ET||Philadelphia Fed President Patrick Harker (voter) speaks at an event in Malvern, Pennsylvania.|
|0830 ET||Chicago Fed President Charles Evans (voter) and Atlanta Fed President Dennis Lockhart (non-voter) speak on the economic outlook and monetary policy at a meeting of the American Council of Life Insurers in Naples, FL.|
|0830 ET||USDA weekly Export Sales.|
|1100 ET||Treasury announces amount of 10-year TIPS to be auctioned Jan 19 (previous $ 11 billion).|
|1200 ET||USDA Jan WASDE crop production.|
|1200 ET||USDA Quarterly grain stocks.|
|1300 ET||Treasury auctions $ 12 billion of 30-year T-bonds.|
|1345 ET||Dallas Fed President Robert Kaplan (voter) will speak at the Dallas Regional Chamber Annual Meeting.|
|1400 ET||Dec monthly budget statement expected -$ 26.0 billion, Nov -$ 136.7 billion.|
|1900 ET||Fed Chair Janet Yellen addresses a town hall meeting with educators and will speak briefly about the mission and responsibilities of the Federal Reserve System. Q&A will follow.|
|Friday, Jan 13|
|US||0830 ET||Dec retail sales expected +0.7% and +0.5% ex autos, Nov +0.1% and +0.2% ex autos.|
|0830 ET||Dec PPI final demand expected +0.3% m/m and +1.6% y/y, Nov +0.4% m/m and +1.3% y/y. Dec PPI ex food & energy expected +0.1% m/m and +1.5% y/y, Nov +0.4% m/m and +1.6% y/y.|
|0930 ET||Philadelphia Fed President Patrick Harker (voter) speaks on economic mobility at an event in Philadelphia.|
|1000 ET||Nov business inventories expected +0.6%, Oct -0.2%.|
|1000 ET||Preliminary-Jan University of Michigan U.S. consumer sentiment index expected +0.3 to 98.5, Dec +4.4 to 98.2.|
|1400 ET||Dec monthly budget statement expected -$ 25.0 billion, Nov -$ 136.7 billion.|
|Delta Air Lines Inc||DAL US||Bef-mkt||Q4 2016 Earnings Release||Q4 2016||0.819|
|Delta Air Lines Inc||DAL US||10:00||Q4 2016 Earnings Call||Q4 2016|
|CarMax Inc||KMX US||10:30||Analyst Day||Y 2017|
|Splunk Inc||SPLK US||12:00||Investor and Analyst Meeting||Y 2017|
|SBA Communications Corp||SBAC US||14:00||Extraordinary Shareholders Meeting||Y 2017|
|Monster Beverage Corp||MNST US||16:15||Investor Meeting||Y 2017|
|Dover Corp||DOV US||18:30||Investor Meeting||Y 2017|