Futures Lower After Cisco Earnings, Weaker Dollar
U.S. equity futures traded slightly lower in early pre-market
trade following some weak guidance from Cisco (NASDAQ:
) for the upcoming quarter and as the dollar traded lower. Also,
some weak earnings in Europe weighed on sentiment.
In other news around the markets:
The South China Morning Post followed up its report from Monday on
the large loan from AgBank overnight, highlighting that three more
loans have been made in similar fashion. The moves by the state
owned lenders to lend to local governments to invest in
diversifying local economies is being considered a stealth fiscal
stimulus. Japan's chief cabinet secretary and finance minister both
spoke overnight and refuted claims from earlier this week that the
government was going to cut corporate taxes to offset a sales tax
hike. The move was cheered by markets earlier this week when it was
first rumored. Retail sales in the U.K. rose a whopping 1.1 percent
in July vs. the consensus estimate gain of 0.6 percent,
accelerating from June's 0.2 percent rise. Retail sales were up 3.1
percent from a year ago. S&P 500 futures fell 2 points to
1,680.00. The EUR/USD was higher at 1.3286. Spanish 10-year
government bond yields were flat at 4.42 percent. Italian 10-year
government bond yields were flat at 4.18 percent. Gold rose 0.52
percent to $1,340.40 per ounce.
Asian shares were mostly lower overnight led down by Japanese
stocks on the news that senior Japanese officials refuted the tax
cut rumors. The Japanese Nikkei 225 Index fell 2.12 percent and the
Topix Index dropped 1.67 percent. In Hong Kong, the Hang Seng Index
was flat and the Shanghai Composite Index fell 0.87 percent in
China. Also, the Korean Kospi rose 0.57 percent and Australian
shares fell 0.1 percent.
European shares were lower on weak sentiment from Asia and some
poor earnings reports while Italy's market was closed. The Spanish
Ibex Index fell 0.01 percent and the French CAC 40 Index declined
0.26 percent. Meanwhile, the German DAX dropped 0.44 percent and
U.K. shares fell 0.44 percent.
Commodities were mostly higher overnight with oil rising and
silver once again leading gains. WTI Crude futures rose 0.59
percent to $107.48 per barrel and Brent Crude futures gained 0.93
percent to $111.23 per barrel. Copper futures dropped 0.4 percent
to $332.90 per pound. Gold was higher and silver futures rose 1.3
percent to $22.07 per ounce.
Currency markets were on the move as the dollar weakened across
the board. The EUR/USD was higher at 1.3286 and the dollar fell
against the yen to 97.86. Overall, the Dollar Index fell 0.23
percent on weakness against the pound, the Canadian dollar, the
yen, the euro, and the Swiss franc.
Earnings Reported Yesterday
Key companies that reported earnings Wednesday include:
) reported fourth quarter EPS of $0.52 vs. $0.51 expected on
revenue of $12.42 billion vs. $12.4 billion expected. However, the
company announced it was cutting 4,000 jobs and will see charges
from the layoffs, which led the company to guide Q1 EPS between
$0.50-0.51 vs. the consensus estimate of $0.51. The company also
guided revenue lower than expected and sees revenue between $12.23
billion and $12.47 billion vs. the consensus forecast of $12.46
billion. Deere and Co. (NYSE:
) reported third quarter EPS of $2.56 vs. $2.16 expected on revenue
of $10.0 billion vs. $9.28 billion expected. Macy's (NYSE:
) reported second quarter EPS of $0.72 vs. $0.79 expected on
revenue of $6.07 billion vs. $6.28 billion expected. Silver Wheaton
) reported second quarter EPS of $0.20 vs. $0.26 expected on
revenue of $166.9 million vs. $194.17 million expected. NetApp
) reported first quarter EPS of $0.53 vs. $0.49 expected on revenue
of $1.52 billion vs. $1.53 billion expected. The company also
guided second quarter EPS between $0.60-0.65 vs. the consensus
estimate of $0.63 and revenue between $1.56-1.66 billion vs. the
estimate $1.63 billion.
Stocks moving in the pre-market included:
) shares fell 8.82 percent after its fourth quarter report but
shares were off of the after-hours lows by about 2 percent. NetApp
) shares declined 3.47 percent pre-market on some weak guidance as
well. J.C. Penney (NYSE:
) shares rose 1.83 percent after rallying into the close Wednesday
on reports that sales improved in July. Newmont Mining (NYSE:
) shares rose 1.44 percent pre-market as metals prices rebounded.
Notable companies expected to report earnings Thursday
) is expected to report second quarter EPS of $1.25 vs. $1.18 a
year ago on revenue of $119.7 billion vs. $114.3 billion a year
ago. Kohl's Corp. (NYSE:
) is expected to report second quarter EPS of $1.05 vs. $1.00 a
year ago on revenue of $4.3 billion vs. $4.2 billion a year ago.
) is expected to report fourth quarter EPS of $1.56 vs. $1.28 a
year ago on revenue of $1.00 billion vs. $831.77 million a year
On the economics calendar Thursday, Fed President Bullard is
expected to speak followed by the CPI report and initial jobless
claims. Later, the Empire State Manufacturing Index, TIC flows,
industrial production, the NAHB Housing Market Index, and the
Philly Fed Survey are due out. Overnight, the German home price
index and the Eurozone CPI report are due out.
Good luck and good trading.
Tune into Benzinga's PreMarket Info show with Dennis Dick and
For a recap of Wednesday's market action, read Benzinga's daily
market wrap .
(c) 2013 Benzinga.com. Benzinga does not provide investment
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