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25
November 2016
OVERNIGHT MARKETS AND NEWS
Dec E-mini S&Ps (ESZ16 +0.20%) are up +0.16% at a new
all-time nearest-futures high as trading resumes from Thursday's Thanksgiving
holiday. Stock prices are still getting a boost on optimism that
President-elect Trump's pledges to increase fiscal spending and cut taxes will
spur economic growth and corporate profits. European stocks are little changed,
down -0.09%, as energy producing stocks decline with crude oil prices (CLF17
-1.15%) down -1.36%.
Algeria's Energy Minister Boutarfa will travel to Tehran on
Saturday in an effort to get Iran on board with other OPEC members in cutting
production. Iran is insisting that it should be allowed to keep increasing
output to pre-sanctions levels of about 4 million bpd. Also, some members in
OPEC are adamant that Russia cut production as well if any OPEC plan to curb
output is to succeed, according to people briefed on the matter because of the
sensitive nature of the talks.
Asian stocks settled higher: Japan +0.36%, Hong Kong +0.51%,
China +0.62%, Taiwan +0.08%, Australia +0.41%, Singapore +0.55%, South Korea
+0.09%, India +1.76%. Asian markets gained on strength in metals and commodity
producing stocks, with Japan's Nikkei Stock Index climbing to a 10-1/2 month
high, as the price of copper (HGZ16 +1.46%) jumps +1.51% to a 2-week high.
The dollar index (DXY00 -0.22%) is down -0.26%. EUR/USD
(^EURUSD) is up +0.33%. USD/JPY (^USDJPY) is down -0.27%.
Dec 10-year T-note prices (ZNZ16 -0.12%) are down -6 ticks
at a 2-year nearest-futures low as the rally in stocks to a new record high
reduces the safe-haven demand for T-notes.
ECB Governing Council member Stournaras said the ECB has a
long way to go to meet its inflation target so it's "far too early"
to discuss the gradual removal of QE.
The German Nov IFO business climate was unch at 110.4,
slightly weaker than expectations of unch at 110.5. The Total Investment &
Insurance Solutions
U.S. STOCK PREVIEW
Key U.S. news today includes: (1) Oct wholesale inventories
(expected +0.2%, Sep +0.1%. Oct retail inventories, Sep +0.3%), (2) Nov Markit
services PMI (expected unch at 54.8, Oct +2.5 to 54.8), (3) USDA weekly Export
Sales.
Russell 1000 earnings reports today include: none.
U.S. IPO's scheduled to price today: none.
Equity conferences during the remainder of this week
include: none. The Total Investment & Insurance Solutions
OVERNIGHT U.S. STOCK MOVERS
Deere & Co. (DE +11.04%) was upgraded to 'Neutral' from
'Underperform' at Longbow Research.
Molson Coors (TAP -1.09%) was downgraded to 'Neutral' from
'Buy' at Bryan Garnier.
Eli Lilly (LLY -10.51%) was downgraded to 'Neutral' from
'Overweight' at Atlantic Equities LLP.
Juno Therapeutics (JUNO -24.50%) was downgraded to 'Hold'
from 'Buy' at SunTrust.
Ctrip.com (CTRIP) reported Q3 adjusted EPS of 17 cents,
better than consensus of 11 cents, and said it will buy Skyscanner in a $1.74
billion deal.
Lockheed Martin (LMT -0.10%) received a $1,28 billion down
payment from the Pentagon to continue production of the F-35 jet while
negotiations continue a contract for 90 aircraft, worth as much as $7.19
billion.
A Federal jury late Wednesday found that Wal-Mart (WMT
+1.01%) failed to pay hundreds of California truck drivers minimum wage and
awarded then $54 million in damages.
Insteel Industries (IIIN +2.12%) jumped over 5% in
after-hours trading after it was announced that it will replace Littelfuse in
the S&P SmallCap 600 Index as of the close of trading Monday, November 28.
Airgain (AIRG +0.75%) fell 5% in after-hours trading after
it announced a release of lock-up restriction on shares of common stock that will
take effect after the close of trading Monday, November 28 and it will offer
$40 million shares on behalf of selling holders.
Corbus Pharmaceuticals Holdings (CRBP +0.63%) dropped almost
7% in after-hours trading after it filed an agreement to offer as much as $35
million in common stock via Cantor Fitzgerald. The Total Investment &
Insurance Solutions
MARKET COMMENTS
Dec E-mini S&Ps (ESZ16 +0.20%) this morning are up +3.50
points (+0.16%) at a new record nearest-futures high. Wednesday's closes:
S&P 500 +0.08%, Dow Jones +0.31%, Nasdaq -0.41%. The S&P 500 on
Wednesday closed slightly higher on positive economic reports that included
+0.4% increase in U.S. Oct capital spending (stronger than expectations of
+0.3%) and the unexpected +2.2 point increase in U.S. Nov University of
Michigan consumer sentiment index to a 6-month high of 93.8 (stronger than
expectations of unchanged at 91.6).
Stocks were undercut by the -1.9%decline in U.S. Oct new
home sales to 563,000 (weaker than expectations of -0.5% to 590,000) and long
liquidation pressure in stocks after the 10-year T-note yield surged to a
16-month high.
Dec 10-year T-notes (ZNZ16 -0.12%) this morning are down -6
ticks at a new 2-year nearest-futures low. Wednesday's closes: TYZ6 -11.00,
FVZ6 -9.50. Dec 10-year T-notes on Wednesday plunged to a 2-year
nearest-futures low and settled lower. T-note prices were undercut by the
stronger-than-expected U.S. economic data on Oct durable goods orders and Nov
University of Michigan consumer sentiment and by a surge in inflation
expectations as the 10-year T-note breakeven inflation rate rose to a 2-year
high.
The dollar index (DXY00 -0.22%) this morning is down -0.260
(-0.26%). EUR/USD (^EURUSD) is up +0.0035 (+0.33%). USD/JPY (^USDJPY) is down
-0.31 (-0.27%). Wednesday's closes: Dollar index +0.660 (+0.65%), EUR/USD
-0.0074 (-0.70%), USD/JPY +1.38 (+1.24%). The dollar index on Wednesday soared
to a 13-1/2 year high and closed higher on the stronger-than-expected U.S. Oct
durable goods orders report and on the surge in the 10-year T-note yield to a
16-month high, which improves the dollar's interest rate differentials.
Jan crude oil prices (CLF17 -1.15%) this morning are down
-65 cents (-1.36%) and Jan gasoline (RBF17 -1.14%) is -0.0159(-1.12%).
Wednesday's closes: Jan crude -0.09 (-0.19%), Jan gasoline
+0.0114 (+0.81%). Jan crude oil and gasoline prices on Wednesday settled mixed
with Jan gasoline at a 3-week high. Crude oil prices were undercut by the rally
in the dollar index to 13-1/2 year high and by the +2.317 million bbl increase
in EIA gasoline inventories (vs expectations of +900,000 bbl). Crude oil prices
were boosted by comments from Iraq Prime Minister Haider Al-Abadi who said Iraq
will bear part of an oil-output cut at next week's OPEC meeting. Crude oil
prices also received a boost from the unexpected -1.255million bbl decline in
EIA crude inventories versus expectations for a build of +1.0 million bbl.The
Total Investment & Insurance Solutions
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