Futures Flat On Relaxed China Fears, Emerging Market Rebound
U.S. equity futures were flat in early pre-market trade as
services data out of China showed that the economy continued to
chug along at low levels in July. Also, easing fears over imminent
Federal Reserve tapering led to rebounds in emerging markets.
In other news around the markets:
China's official non-manufacturing PMI rose to 54.1 from 53.9 in
July from June while the HSBC China Services PMI was flat at 51.3
in July. Although the services sector is smaller than the
manufacturing sector in China, it is growing and should become
larger as China shifts more towards a consumption driven economy. A
new Reuters poll of primary dealers now sees a 50 percent chance
that the Fed will taper in September, down from about 65 percent in
early July, in the wake of the weaker than expected non-farm
payrolls report. Spain's services sector continued to recover as
the Services PMI rose to 48.5 from 47.8 in June, the highest
reading in 26 months. Economists surveyed by Reuters were looking
for a reading of 48.0. S&P 500 futures fell 0.4 points to
1,703.60. The EUR/USD was higher at 1.3288. Spanish 10-year
government bond yields fell 2 basis points to 4.56 percent. Italian
10-year government bond yields fell 3 basis points to 4.25 percent.
Gold rose 0.23 percent to $1,313.50 per ounce.
Asian shares were mixed overnight despite the largely better
China data after the IMF issued a warning to Japan over its fiscal
position. The Japanese Nikkei 225 Index fell 1.44 percent and the
Topix Index declined 0.96 percent. In Hong Kong, the Hang Seng
Index rose 0.16 percent and the Shanghai Composite Index gained
1.04 percent. Also, the Korean Kospi fell 0.37 percent and
Australian shares declined 0.11 percent.
European shares were higher in early trade heading into the
services PMIs for Germany, France and the broad eurozone. The
Spanish Ibex Index rose 0.35 percent and the Italian FTSE MIB Index
gained 0.31 percent. Meanwhile, the German DAX rose 0.2 percent and
the French CAC 40 Index gained 0.17 percent while U.K. shares added
Commodities were mixed overnight as oil gained following the
China data. WTI Crude futures rose 0.35 percent to $107.31 per
barrel and Brent Crude futures gained 0.24 percent to $109.21 per
barrel. Copper futures fell 0.36 percent to $316.10 per pound. Gold
was higher and silver futures fell 0.16 percent to $19.88 per
Currency markets were on the move overnight as the yen gained
following the IMF warning and the dollar weakened broadly. The
EUR/USD was higher at 1.3288 and the dollar fell against the yen to
98.42. Overall, the Dollar Index fell 0.11 percent on weakness
against the yen, the Canadian dollar, the euro, the pound, and the
Earnings Reported Yesterday
Key companies that reported earnings Friday include:
) reported second quarter EPS of $2.77 vs. $2.98 expected on
revenue of $55.3 billion vs. $56.01 billion expected. Alpha Natural
) reported a second quarter loss of $0.59 per share, in line, on
revenue of $1.34 billion vs. $1.24 billion expected. Cablevision
) reported second quarter EPS of $0.11 vs. $0.04 expected on
revenue of $1.57 billion vs. $1.58 billion expected. Eaton Corp.
) reported second quarter EPS of $1.09 vs. $1.11 expected on
revenue of $5.6 billion vs. $5.77 billion expected.
Notable companies expected to report earnings Monday
Kindred Healthcare (NYSE:
) is expected to report second quarter EPS of $0.33 vs. $0.41 a
year ago on revenue of $1.47 billion vs. $1.54 billion a year ago.
Rockwood Holdings (NYSE:
) is expected to report second quarter EPS of $0.76 vs. $1.24 a
year ago on revenue of $955.94 million vs. $905.6 million a year
ago. Hologix (NASDAQ:
) is expected to report third quarter EPS of $0.37 vs. $0.35 a year
ago on revenue of $626.48 million vs. $470.23 million a year ago.
Black Hills Corp. (NYSE:
) is expected to report second quarter EPS of $0.42 vs. $0.34 a
year ago on revenue of $285.94 million vs. $242.4 million a year
ago. Jamba (NASDAQ:
) is expected to report second quarter EPS of $0.37 vs. $0.25 a
year ago on revenue of $70.17 million vs. $66.04 million a year
On the economics calendar Monday, the Gallup US Consumer
Spending Survey is set to be releases ahead of the ISM
Non-Manufacturing Index and the weekly 3- and 6-month bond
auctions. Also, Richard Fisher of the Dallas Fed is set to speak.
Overnight, the RBA rate decision, the Italian GDP report, and the
German factory orders are all expected.
Good luck and good trading.
Tune into Benzinga's PreMarket Info show with Dennis Dick and
For a recap of Friday's market action, read Benzinga's daily
market wrap .
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