US : Pre Market News – 20 Jan 2017

PREMARKET WORLD NEWS

Mar E-mini S&Ps (ESH17 +0.18%) are up +0.15% and European stocks are up +0.36% on signs of strength in the global economy after China Q4 GDP grew more than expected. The markets are also awaiting any signals from President-elect Trump, who will be sworn in as President today, for indications his administration will follow through on his pro-growth campaign promises. Energy producing stocks are higher with Mar WTI crude oil (CLH17 +1.40%) up +1.02% on signs of stronger demand from China after China Dec oil processing rose +1.1% m/m to a record 11.3 million bpd. Asian stocks settled mixed: Japan +0.34%, Hong Kong -.71%, China +0.70%, Taiwan +0.14%, Australia -0.66%, Singapore +0.10%, South Korea -0.44%, India -1.00%.

The dollar index (DXY00 +0.20%) is up +0.27%. EUR/USD (^EURUSD) is down -0.22%. USD/JPY (^USDJPY) is up +0.30%.

Mar 10-year T-note prices (ZNH17 -0.25%) are down -11 ticks at a 2-week low after Fed Chair Yellen said it is “prudent” to gradually raise interest rates over time.

Speaking Thursday night at Stanford University, Fed Chair Yellen said it is “prudent’ to gradually raise interest rates over time as economic growth is unlikely to “markedly” pick up in the near term given weak overseas demand and other factors and that allowing the economy to run “hot” would be risky and unwise.

China Q4 GDP rose +6.8% y/y, stronger than expectations of +6.7% y/y.

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) Philadelphia Fed President Patrick Harker (voter) speaks on the economic outlook at an event in New Jersey, (2) President-elect Trump is inaugurated as President, (3) San Francisco Fed President John Williams (non-voter) delivers closing remarks at the Bay Area Council meeting, (4) San Francisco Fed President John Williams (non-voter) speaks at the Solano Economic Development Corporation’s Annual Luncheon meeting, (5) USDA weekly Export Sales.

S&P 500 earnings reports today include: GE (consensus $ 0.46), Procter & Gamble (1.06), Schlumberger (0.27), SunTrust Banks (0.88), Regions Financial (0.23), Rockwell Collins (1.15), Citizens Financial (0.52), Kansas City Southern (1.17), Synchrony Financial (0.67).

U.S. IPO’s scheduled to price today: none.

Equity conferences: none.

PREMARKET U.S. STOCKS

Amazon.com (AMZN +0.19%) was rated a new ‘Buy’ at Aegis with a price target of $ 953.

Goldman Sachs (GS -1.23%) was upgraded to ‘Market Outperform’ from ‘Market Perform’ at Vining Sparks with a 12-month target price of $ 255.

Pioneer Natural Resources (PXD +0.51%) was upgraded to ‘Overweight’ from ‘Neutral’ at MUFG Securities Americas with a 12-month target price of $ 212.

Atlassian Corp. PLC ({=TEAM =}) reported Q2 revenue of $ 148.9 million, better than consensus of $ 144.1 million.

1st Source Corp. (SRCE +0.02%) reported Q4 EPS of 58 cents, higher than consensus of 56 cents.

Concho Resources (CXO -0.88%) was upgraded to ‘Overweight’ from ‘Neutral’ at MUFG Securities Americas with a 12-month target price of $ 175.

American Express (AXP -1.03%) lost 1% in after-hours trading after it reported Q4 adjusted EPS of 91 cents, weaker than consensus of 99 cents, although Q4 revenue of $ 8.0 billion was above consensus of $ 7.95 billion.

Skyworks Solutions (SWKS -1.02%) jumped nearly 8% in after-hours trading after it reported Q1 adjusted EPS of $ 1.61, higher than consensus of $ 1.58, and said it sees Q2 adjusted EPS of $ 1.40, above consensus of $ 1.39.

International Business Machines (IBM +0.01%) slid nearly 3% in after-hours trading after it reported Q4 adjusted gross margin of 51.0%, weaker than consensus of 52.8%.

Preferred Bank/Los Angeles (PFBC -1.69%) reported Q4 EPS of 71 cents, above consensus of 65 cents/

Carolina Financial (CARO -2.11%) proposed a $ 40 million offering of common stock.

TrueCar (TRUE +1.94%) fell 3% in after-hours trading after it filed a $ 100 million mixed securities shelf offering.

Stemline Therapeutics (STML -5.98%) dropped 5% in after-hours trading after it announced a public offering of common stock.

MARKET COMMENTS

Mar E-mini S&Ps (ESH17 +0.18%) this morning are up +3.50 points (+0.15%). Thursday’s closes: S&P 500 -0.36%, Dow Jones -0.37%, Nasdaq -0.09%. The S&P 500 on Thursday closed lower on the unexpected -0.2% decline in U.S. Dec building permits, a proxy for future construction, weaker than expectations of a +1.1% increase. Stocks were also undercut by interest rate concerns after the 10-year T-note yield rose to a 2-week high. Stocks found support on (1) the unexpected decline in U.S. weekly initial unemployment claims by -15,000 to 234,000, better than expectations of +5,000 to 252,000 and a 2-month low, and (2) the unexpected +3.9 point increase in the Jan Philadelphia Fed business outlook index to 23.6, stronger than expectations of -6.2 to 15.3 and a 2-year high.

Mar 10-year T-notes (ZNH17 -0.25%) this morning are down -11 ticks at a fresh 2-week low. Thursday’s closes: TYH7 -17.50, FVH7 -9.75. Mar 10-year T-notes on Thursday fell to a 2-week low and closed lower on the unexpected decline in U.S. weekly jobless claims by -15,000 to a 2-month low and the unexpected +3.9 point increase in the Jan Philadelphia Fed business outlook index to a 2-year high of 23.6. T-notes were also undercut by increased inflation expectations as the 10-year T-note breakeven inflation rate rose to a 2-1/3 year high.

The dollar index (DXY00 +0.20%) this morning is up +0.27 (+0.27%). EUR/USD (^EURUSD) is -0.0023 (-0.22%). USD/JPY (^USDJPY) is +0.34 (+0.30%). Thursday’s closes: Dollar index +0.17 (+0.17%), EUR/USD +0.0034 (+0.32%), USD/JPY +0.21 (+0.18%). The dollar index on Thursday closed higher on comments from ECB President Draghi that signal the ECB remains committed to euro-negative stimulus when he said there are “no convincing signs yet of upward trend in underlying inflation.” The dollar was also boosted by stronger-than-expected U.S. economic data on weekly jobless claims and the Jan Philadelphia Fed business outlook survey.

Mar WTI crude oil prices (CLH17 +1.40%) this morning are up +53 cents (+1.02%) and Mar gasoline (RBH17 +1.83%) is +0.231 (+1.48%). Thursday’s closes: Mar crude +0.23 (+0.447%), Mar gasoline -0.0094 (-0.60%). Mar crude oil and gasoline on Thursday settled mixed with Mar gasoline at a 1-month low. Crude oil prices were undercut by a stronger dollar, the unexpected +2.347 million bbl increase in EIA crude inventories (vs expectations for a -1.0 million bbl decline) and the +5.95 million bbl increase in EIA gasoline supplies to a 10-month high (vs than expectations of +2.0 million bbl). On the positive side, crude supplies at Cushing, the delivery point for WTI futures, fell for a second week as they dropped -1.27 million bbl.

GLOBAL EVENT CALENDAR 01/20/2017
Friday, Jan 20
US0830 ETUSDA weekly Export Sales.
0900 ETPhiladelphia Fed President Patrick Harker (voter) speaks on the economic outlook at an event in New Jersey.
1200 ETPresident-elect Trump is inaugurated as President.
1300 ETSan Francisco Fed President John Williams (non-voter) delivers closing remarks at the Bay Area Council meeting.
1545 ETSan Francisco Fed President John Williams (non-voter) speaks at the Solano Economic Development Corporations Annual Luncheon meeting.
Monday, Jan 23
US1100 ETUSDA weekly grain export inspections.
U.S. STOCK CALENDAR 01/20/2017
CompanyTickerTimeEvent DescriptionPeriodEstimate
General Electric CoGE USBef-mktQ4 2016 Earnings ReleaseQ4 20160.46
Synchrony FinancialSYF USBef-mktQ4 2016 Earnings ReleaseQ4 20160.668
Schlumberger LtdSLB US6:00Q4 2016 Earnings ReleaseQ4 20160.265
SunTrust Banks IncSTI US6:00Q4 2016 Earnings ReleaseQ4 20160.879
Regions Financial CorpRF US6:00Q4 2016 Earnings ReleaseQ4 20160.226
Rockwell Collins IncCOL US6:30Q1 2017 Earnings ReleaseQ1 20171.146
Procter & Gamble Co/ThePG US7:00Q2 2017 Earnings ReleaseQ2 20171.062
Citizens Financial Group IncCFG US7:00Q4 2016 Earnings ReleaseQ4 20160.521
Kansas City SouthernKSU US8:00Q4 2016 Earnings ReleaseQ4 20161.167
SunTrust Banks IncSTI US8:00Q4 2016 Earnings CallQ4 2016
General Electric CoGE US8:30Q4 2016 Earnings CallQ4 2016
Procter & Gamble Co/ThePG US8:30Q2 2017 Earnings CallQ2 2017
Schlumberger LtdSLB US8:30Q4 2016 Earnings CallQ4 2016
Synchrony FinancialSYF US8:30Q4 2016 Earnings CallQ4 2016
Kansas City SouthernKSU US8:45Q4 2016 Earnings CallQ4 2016
Citizens Financial Group IncCFG US9:00Q4 2016 Earnings CallQ4 2016
Rockwell Collins IncCOL US9:00Q1 2017 Earnings CallQ1 2017
Regions Financial CorpRF US11:00Q4 2016 Earnings CallQ4 2016

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