Futures Rise Despite U.K. Downgrade, Weak China Manufacturing
U.S. equity futures rose slightly in pre-market trading despite
the downgrade of the U.K.'s sovereign credit rating to Aa1 from AAA
by Moody's. Also, the China HSBC Flash Manufacturing PMI for
February was released at 50.4, weaker than expectations of 52.2 and
below the previous reading of 52.3.
In other news around the markets:
Japan has nominated Asian Development Bank Chief Haruhiko Kuroda to
be the next Bank of Japan Governor, with another candidate, Kukuo
Iwata, was nominated as a Deputy Governor. The Bank of Greece sees
the Greek economy contracting 4.5 percent in 2013 with growth
finally returning in 2014. Italy auctioned 2-year zero-coupon bonds
to yield 1.682 percent, higher than the previous auction just hours
before the initial results of the critical parliamentary elections
are released. S&P 500 futures rose 2.9 points to 1,517.50. The
EUR/USD was higher at 1.3258. Spanish 10-year government bond
yields rose to 5.16 percent. Italian 10-year government bond yields
rose to 4.45 percent. Gold rose 1.13 percent to $1,590.50 per
Asian shares were mostly higher overnight led by Japanese shares
following the Bank of Japan nominations. The Japanese Nikkei Index
rose 2.43 percent and the Shanghai Composite Index rose 0.5 percent
while the Hang Seng Index rose 0.17 percent. Also, the Korean Kospi
fell 0.46 percent and Australian shares rose 0.75 percent.
European shares were higher overnight ahead of the Italian
election results. The Spanish Ibex Index rose 0.68 percent and the
Italian FTSE MIB Index rose 0.85 percent. Meanwhile, the German DAX
rose 1.29 percent and the French CAC rose 0.66 percent while U.K.
shares rose 0.46 percent.
Commodities were stronger overnight after last week's massive
weakness despite the weaker than expected China data. WTI Crude
futures rose 0.75 percent to $93.83 per barrel and Brent Crude
futures rose 0.91 percent to $115.14 per barrel. Copper futures
rose 0.37 percent to $356.35 as mining stocks rallied. Gold was
higher and silver futures rose 2.03 percent to $29.10 per
Currency markets were in flux overnight as the euro
strengthened, the pound weakened and the yen continued its slide.
The EUR/USD was higher at 1.3258 and the dollar rose against the
yen to 93.87 and the cable fell to 1.5146. Overall, the Dollar
Index fell 0.23 percent on weakness against the euro and the swiss
franc. Also, the AUD/USD was weaker following the Chinese
manufacturing data and the EUR/GBP rose 0.62 percent following the
U.K. downgrade while the EUR/JPY rose 0.99 percent.
Stocks moving in the pre-market included:
Chesapeake Energy (NYSE:
) shares rose 1.95 percent pre-market as the company reported
strong earnings last week and is expected to name a new CEO soon.
Newmont Mining (NYSE:
) shares rose 1.47 percent pre-market after reporting strong
earnings last week and positive comments in this weekend's
Barron's. Carnival Corporation (NYSE:
) shares fell 0.97 percent pre-market as passengers of the Triumph,
the ship that broke down at sea and filled with sewage, are
launching a class action lawsuit against the company. ADT Corp
) shares rose 1.11 percent after Barron's said the shares could
rise 20 percent in the next year.
Notable companies expected to report earnings Monday
) is expected to report fourth quarter EPS of $0.49 vs. $0.46 a
year ago. Big Lots (NYSE:
) is expected to report fourth quarter EPS of $1.99 vs. $1.75 a
year ago. Three-D Systems (NYSE:
) is expected to report fourth quarter EPS of $0.38 vs. $0.16 a
year ago. Vivus (NASDAQ:
) is expected to report a fourth quarter loss of $0.44 per share
vs. a loss of $0.14 per share a year ago.
On the economics calendar Monday, the Chicago Fed National
Activity Index and the Dallas Fed Manufacturing Survey are due out.
Also, the Treasury is set to auction 3- and 6-month bills as well
as 2-year notes. Lastly, the Fed's Dennis Lockhart is expected to
speak. In Europe, look for Italian exit polls to leak out
approximately one hour after polls close at 9 am eastern.
Overnight, look for clearer Italian election results as well as an
Italian 6-month bill auction.
Good luck and good trading.
(c) 2013 Benzinga.com. Benzinga does not provide investment
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