FP Trading Desk
Jobless claims, earnings, banks & rating agencies – Vialoux - Thu, 13 May 2010
U.S. equity index futures are slightly lower this morning. S&P 500 futures are down 2 points in pre-opening trade.
Index futures moved slightly lower following release of the weekly jobless claims report. Jobless claims fell 4,000 to 444,000. Consensus was a drop of 9,000.
First quarter earnings continue to exceed expectations. Companies that reported higher than expected first quarter earnings overnight included Canadian Tire, Quadra Mining, Cineplex Odeon, Kohl’s, Whole Foods and Cisco. However, responses to better than expected first quarter earnings are not always positive. Kohl’s eased 2% and Cisco slipped 2% in overnight trading. Cisco also was downgraded from Buy to Neutral by Davenport.
Eight money center U.S. banks are under pressure this morning after the New York Attorney General announced an investigation of their relationship with credit rating agencies.
Sybase gained 15% after SAP offered to purchase the company in a friendly deal worth $5.8 billion.
The exception among money center banks is Morgan Stanley. It added 2% in pre-opening trade after FBR Capital registered an upgrade from Market Perform to Outperform.
U.S. Steel gained 2% after Goldman Sachs upgraded the stock from Buy to Conviction Buy.
EBay gained 4% after Morgan Stanley upgraded the stock to Outperform.
Taseko Mines was upgraded by Raymond James from Market Perform to Outperform.
Aurizon Mines was downgraded by Raymond James from Outperform to Market Perform.
On Assignment for a stock play on weekly jobless claim day
Don Vialoux, chartered market technician, is the author of a free
daily report on equity markets, sectors, commodities, equities and
Exchange-Traded Funds. For more visit Don Vialoux's Web site
U.S. futures, gold, Morgan Stanley, Disney, PotashCorp — Vialoux - Wed, 12 May 2010
U.S. index futures are higher this morning. S&P 500 futures are up 6 points in pre-opening trade.
Index futures slipped slightly after release of the March trade report. Consensus was an increase in the deficit from $39.7 billion to $40.0 billion. Actual was a deficit of $40.4 billion.
Canada’s trade report for March was slightly disappointing. Consensus was a surplus of $1.6 billion. Actual was a surplus of $300 million.
Gold continues to move higher. It gained $18 U.S. per ounce to another all time high.
Morgan Stanley fell 5% in pre-opening trade on news that federal prosecutors are investigating the company’s methods to market collateral debt obligations.
Ivanhoe Mines was downgraded by TD Newcrest from Speculative Buy to Hold.
Disney slipped 3% despite reporting higher than consensus first quarter earnings. Traders remain in a “sell on news” mood.
Desjardins upgraded Potash Corp from Hold to Buy.
Pepsico gained 2% after Goldman Sachs upgraded the stock from Buy to Conviction Buy.
Quebecor reported less than consensus first quarter results.
Technical Analysis: Seeking a healthy stock for investors – Omega Healthcare Investors (OHI)
Don Vialoux, chartered market technician, is the author of a free daily report on equity markets, sectors, commodities, equities and Exchange-Traded Funds. For more visit Don Vialoux's Web site
U.S. equities, Europe, Toyota, conglomerates — Vialoux - Tue, 11 May 2010
U.S. equity index futures are lower this morning. S&P 500 futures are down 13 points in pre-opening trade. Traders are skeptical about Europe’s financial bail out package. In addition, they are concerned that China will increase interest rates again in order to dampen inflation expectations. Inflation in China rose to a 2.8% rate in April. The Shanghai Composite Index fell 1.9% on the news. Economically sensitive commodity prices including crude oil and copper moved lower.
Skepticism about Europe’s financial bail out package has spilled into the gold market. Gold is up $20 to $1220 U.S. per ounce. Gold is testing its all time high at $1226.40 U.S. per ounce.
Toyota moved slightly lower after reporting higher than expected first quarter earnings.
Credit Suisse launched coverage of the conglomerate sector by giving an Outperform rating to General Electric, United Technologies and Emerson Electric. Target on General Electric is $73. Target on United Technologies is $93. Target on Emerson Electric is $62.
Quick, get back into gold. The market has fooled you!
Don Vialoux, chartered market technician, is the author of a free
daily report on equity markets, sectors, commodities, equities and
Exchange-Traded Funds. For more visit Don Vialoux's Web site
Europe, Fannie Mae, upgrades – Vialoux - Mon, 10 May 2010
U.S. equity index futures are sharply higher this morning. S&P 500 futures are up 46 points in pre-opening trade. Strength came into equity markets following news that European finance ministers have set up a line of credit valued at $970 billion designed to purchase sovereign debt of European nations. Notably stronger in overnight markets were financial service stocks, particularly in Europe. European banks hold large positions in European sovereign debt.
The Euro strengthened on the news and the U.S. Dollar weakened. Commodities priced in U.S. Dollars other than gold moved higher. Strength in commodity prices is expected to add to strength in the TSX Composite Index at the opening.
Not all the news was bullish this morning. Fannie Mae announced a first quarter loss of $13.1 billion. It also announced that its long term financial sustainability is uncertain. Fannie Mae holds residential mortgages with a principal value in excess of $500 billion. Most of its portfolio of mortgages are “under water”. Congress eventually will need a plan to bail out Fannie Mae.
Goldman’s Sach’s influence on equity markets appeared once again. Boeing gained 5% after Goldman Sachs upgraded the stock from Neutral to Conviction Buy. Target was raised from $82 to $90.
Devon Energy added 4% after Argus upgraded the stock from Hold to Buy. Target price is $76.
Cott Beverages was upgraded by Stifel Nicolaus from Hold to Buy. Target is $10.25.
Gildan Activewear was upgraded by TD Newcrest from Hold to Buy.
Eldorado Gold was upgraded by Credit Suisse from Neutral to Outperform
Don Vialoux, chartered market technician, is the author of a free daily report on equity markets, sectors, commodities, equities and Exchange-Traded Funds. For more visit Don Vialoux's Web site
Contagion, employment, UK – Vialoux - Fri, 07 May 2010
U.S. equity index futures continued to recover from a deep sell off. S&P 500 futures added 5 points in pre-opening trade despite overnight losses by equity markets in Asia and Europe. Citigroup gave European market a bearish start with a prediction that fears of sovereign debt contagion over Greece could trigger a near-term correction of up to 20%.
Interesting reactions to the U.S. April employment report released this morning at 8:30 AM EDT! Consensus was an increase in non-farm payrolls to 180,000 from 162,000 in March. Actual was an increase to 290,000. In addition, the March report was revised upward to 230,000. However, the rest of the report was less positive. Consensus for April Hourly Earnings was an increase of 0.1%. Actual was no change. Consensus for the April unemployment rate was unchanged at 9.7%. Actual was an increase to 9.9%. Initial reaction to the report by S&P 500 futures was a slight upward move to a gain of 10 points. However, profit taking quickly re-entered and futures moved lower.
Great news on employment in Canada! Canada added 108,700 jobs in April, the largest monthly gain since August 2002. Consensus was 24,000. Canada’s unemployment rate also slipped 0.1% to 8.1%. The Canadian Dollar immediately gained 1.00 U.S. cents on the news to 96.04 cents U.S. . The news raised speculation that the Bank of Canada will raise its overnight lending rate to major banks in June.
The London FT Index is mixed this morning following the election in the United Kingdom. The Tory party won the most seats, but do not have a majority. Negotiations between the three major parties will occur over the next week to determine who will govern.
Canadian investment dealers are not giving up on the Canadian energy sector. This morning TD Newcrest upgraded Canadian Natural Resources from Hold to Buy.
Alcoa added 2% after BMO Capital upgraded the stock from Market Perform to Outperform. Target price is $15.
Technical analysis: A great gold stock – Great Basins Gold (GLG)
Don Vialoux, chartered market technician, is the author of a free daily report on equity markets, sectors, commodities, equities and Exchange-Traded Funds. For more visit Don Vialoux's Web site
Recent Comments