Monday, 12 September 2016

Global Markets & News-The Total Investment & Insurance Solutions

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12 September 2016

OVERNIGHT MARKETS AND NEWS

Sep E-mini S&Ps (ESU16 -0.64%) are down -0.60% at a 2-month low and European stocks are down -1.94% at a 2-week low on concern the Fed is closer to raising interest rates. The yield on the German bund 10-year yield and the U.S. 10-year T-note yield both climbed to 2-1/2 month highs on speculation global central banks may be done expanding their stimulus measures. Rate hike concerns have also undercut commodity prices with crude oil (CLV16 -2.31%) down -1.79% and copper (HGZ16 -0.72%) down -0.81% at a 2-3/4 month low. That has pressured energy producing stocks and mining companies. Asian stocks settled lower: Japan -1.73%, Hong Kong -3.36%, China -1.85%, Taiwan -1.18%, Australia -2.24%, Singapore closed for holiday, South Korea -2.63%, India -1.54%. Losses in technology companies led Asian markets lower as Samsung Electronic tumbled 7% after regulators and airlines warned against the use of Samsung's Note 7 smartphones due to risk of fire from its batteries.

The dollar index (DXY00 +0.03%) is up +0.05%. EUR/USD (^EURUSD) is down -0.10%. USD/JPY (^USDJPY) is down -0.62%.

Dec T-note prices (ZNZ16 -0.12%) are down -4.5 ticks at a 2-1/2 month low. The Total Investment & Insurance Solutions

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) Atlanta Fed President Dennis Lockhart (non-voter) speaks about monetary policy and the economy to the National Association for Business Economics, (2) Treasury auctions $24 billion of 3-year T-notes, (3) Minneapolis Fed President Neel Kashkari (non-voter) speaks about too-big-to-fail and the U.S. economy at an event in St. Paul, MN, (4) Treasury auctions $23 billion of 10-year T-notes, (5) Fed Governor Lael Brainard discusses the outlook for the U.S. economy and monetary policy at the Chicago Council on Global Affairs, (6) USDA weekly grain export inspections, (7) USDA Sep WASDE crop production, and (8) USDA Weekly Crop Progress.

Russell 1000 companies that report earnings today: none.

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

Equity conferences today include: Barclays Global Financial Services Conference on Mon-Wed, Morgan Stanley Global Health Care Conference on Mon-Thu, B.Riley & Co. Consumer Conference on Tue, Raymond James North American Equities Conference on Tue, Bank of America Merrill Lynch Global Real Estate Conference on Tue-Wed, Deutsche Bank Technology Conference on Tue-Wed, Hart Energy DUG Eagle Ford Conference on Tue-Wed, KeyBanc Basic Materials & Packaging Conference on Tue-Wed, Credit Suisse Basic Materials Conference on Tue-Thu, Bank of America Merrill Lynch Power & Gas Leaders Conference on Wed, Credit Suisse European Industrials Conference on Wed, Deutsche Bank Metals and Mining Conference on Wed, Mizuho Investment Conference on Wed, Peters & Co.Limited Energy Conference on Wed, Bank of America Merrill Lynch Media, Communications & Entertainment Conference on Wed-Thu, Morgan Stanley Laguna Conference on Wed-Fri, Bank of America Merrill Lynch Japan Conference on Thu, BMO Capital Markets Back to School Education Conference on Thu, UBS Best of Americas Conference on Thu, Citi Global Industrials Conference on Fri, Kazakh Drilling Roundtable - 2nd Annual on Fri. The Total Investment & Insurance Solutions

OVERNIGHT U.S. STOCK MOVERS

Marathon Oil (MRO -6.39%) was downgraded to 'Neutral' from 'Outperform' at Credit Suisse.
Praxair (PX -2.62%) slid nealy 3% in pre-market trading after it said it ended merger talks with Linde AG.
HP Inc. (HPQ -3.83%) lost 1% in pre-market trading after it said it bought Samsung Electronics printer business for about $1.05 billion.
AutoZone (AZO -0.95%) was upgraded to 'Buy' from 'Neutral' at UBS with a 12-month target price of $825.
Target (TGT -0.66%) is down nearly 3% in pre-market trading after it was downgraded to 'Market Perform' from 'Outperform' at Cowen.
Colgate (CL -2.92%) was upgraded to 'Buy' from 'Neutral' at Bank of America/Merrill Lynch with a price target of $80.
Tronc (TRNC +0.24%) said it is in active discussions over Gannet's takeover bid of about $673 million.

The U.S. Consumer Product Safety Commission urged users of Samsung Electronics Note 7 smartphone to turn them off immediately and stop charging them due to fire risk
Southwest Airlines (LUV -3.66%) said it reached a tentative agreement with its flight attendants.
United Continental Holdings (UAL -3.51%) fell nearly 1% in after-hours trading after it said it sees full-year CASM ex-items 2.5%-3.5%. higher than the 2%-3% increase it said it saw in July, citing ratification of the flight attendants contract.
American Airlines Group (AAL -2.19%) announced that it had reached a tentative pact with the transport workers union.
Swift Transportation (SWFT +4.61%) slid over 1% in after-hours trading after it announced that it will take a charge on the retirement of CEO Jerry Moyes.
CoLucid Pharmaceuticals (CLCD +5.91%) fell nearly 1% in after-hours trading after it priced a 3.25 million share secondary offering. The Total Investment & Insurance Solutions

MARKET COMMENTS

Sep E-mini S&Ps (ESU16 -0.64%) this morning are down -12.75 points (-0.60%) at a 2-month low. Friday's closes: S&P 500 -2.45%, Dow Jones -2.13%, Nasdaq -2.55%. The S&P 500 on Friday sold off to a 2-month low and closed sharply lower on the breakout in the 10-year T-note yield to a new 2-1/2 month high and on disappointment that the ECB on Thursday decided not to extend the ending date of its QE program beyond the current March 2017. In addition, Boston Fed President Rosengren (voter) on Friday said waiting too long to raise rates could risk financial stability.

Dec 10-year T-notes (ZNZ16 -0.12%) this morning are down -4.5 ticks to a fresh 2-1/2 month low. Friday's closes: TYZ6 -11.50, FVZ6 -5.50. Dec T-notes on Friday fell to a 2-1/2 month low and closed lower on carryover weakness from a plunge in German bund prices to a 1-1/2 month low on disappointment that the ECB on Thursday did not expand QE. T-notes were also hurt by comments from Boston Fed President Rosengren who said that waiting too long to raise interest rates threatens the U.S recovery.

The dollar index (DXY00 +0.03%) this morning is up +0.043 (+0.05%). EUR/USD (^EURUSD) is down -0.0011 (-0.10%). USD/JPY (^USDJPY) is down-0.64 (-0.62%). Friday's closes: Dollar index +0.309 (+0.33%), EUR/USD -0.0027 (-0.24%), USD/JPY +0.20 (+0.204%). The dollar index on Friday closed higher on hawkish comments from Boston Fed President Rosengren who warned that waiting too long to raise interest rates threatens the economic recovery. The dollar was also boosted by improved interest rate differentials with the 10-year T-note yield rising to a new 2-1/2 month high. There was weakness in EUR/USD after German Jul exports unexpectedly fell -2.6% m/m, the biggest decline in 11 months.


Oct crude oil (CLV16 -2.31%) this morning is down -82 cents (-1.79%) and Oct gasoline (RBV16 -0.17%) is up +0.0054 (+0.40%). Friday's closes: CLV6-1.74 (-3.65%), RBV6 -0.0554 (-3.91%). Oct crude and gasoline on Friday closed lower on a stronger dollar and on speculation that Hurricane Hermine caused the large drawdown in Thursday's EIA crude inventories and that this Wednesday’s EIA data will show a surge in oil supplies. Crude oil prices were also hurt by the slump in the S&P 500 to a 2-month low, which undercuts confidence in the economic outlook and energy demand.The Total Investment & Insurance Solutions

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