Futures Higher On Earnings
U.S. equity futures rose on the back of some strong earnings in
the U.S. from notable companies including Halliburton (NYSE:
) and Texas Instruments (NASDAQ:
). As earnings season kicks into high gear this week, expect
earnings to continue to drive markets.
In other news around the markets:
The Bank of Spain updated its economic forecasts overnight and now
says that Spain's recession eased to a -0.1 percent contraction in
the second quarter from -0.5 percent in the first. They noted a
rise in exports and a gain in tourism as drivers in the second
quarter. After weeks of speculation, KPN (OTC:
) announced that it would sell its German business to Telefonica
). The Royal Baby was born Monday but importantly, economists
estimate that baby fever could have boosted the U.K. economy by
over $300 million. S&P 500 futures rose 2.6 points to 1,692.90.
The EUR/USD was lower at 1.3176. Spanish 10-year government bond
yields fell 3 basis points to 4.58 percent. Italian 10-year
government bond yields were flat at 4.31 percent. Gold fell 0.39
percent to $1,332.10.
Asian shares were higher overnight following some rumors that
another fiscal stimulus may be in the pipeline in Japan. The
Japanese Nikkei 225 Index rose 0.82 percent and the Topix Index
gained 0.51 percent. In Hong Kong, the Hang Seng Index rose 2.33
percent while the Shanghai Composite Index rose 1.95 percent in
China. Also, the Korean Kospi gained 1.27 percent and Australian
shares rose 0.3 percent.
European shares were higher overnight following some positive
earnings, some strong M&A activity, and the positive Bank of
Spain guidance. The Spanish Ibex Index rose 1.56 percent while the
Italian FTSE MIB Index gained 0.95 percent. Meanwhile, the German
DAX rose 0.27 percent and the French CAC 40 Index gained 0.18
percent while U.K. shares rose 0.21 percent.
Commodities were lower overnight as WTI returned to a discount
to Brent. WTI Crude futures fell 0.7 percent to $106.19 per barrel
and Brent Crude futures declined 0.35 percent to $107.77 per
barrel. Copper futures fell 0.49 percent to $316.95 per pound. Gold
was lower and silver futures declined 1.09 percent to $20.22 per
Currency markets were rather quiet overnight as moves were
tepid. The EUR/USD was lower at 1.3176 and the dollar gained
against the yen to 99.83. Overall, the Dollar Index rose 0.1
percent on strength against the Swiss franc, the yen, the euro, and
Earnings Reported Yesterday
Key companies that reported earnings Monday include:
) reported second quarter EPS of $0.73 vs. $0.72 expected on
revenue of $7.3 billion vs. $7.25 billion. McDonald's (NYSE:
) reported second quarter EPS of $1.38 vs. $1.40 expected on
revenue of $7.08 billion vs. $7.1 billion expected. Kimberly-Clark
) reported second quarter EPS of $1.41 vs. $1.39 a year ago on
revenue of $5.27 billion vs. $5.34 billion a year ago. Gannet
) reported second quarter EPS of $0.58, in line, on revenue of $1.3
billion vs. $1.33 billion a year ago. Texas Instruments (NASDAQ:
) reported second quarter EPS of $0.42 vs. $0.41 expected on
revenue of $3.05 billion vs. $3.06 billion expected. The company
also sees third quarter EPS of $0.49-0.57 vs. the $0.51 estimate on
revenue of $3.09-3.35 billion vs. the $3.2 billion estimate.
Canadian National Railway (NYSE:
) reported second quarter EPS of $1.66 vs. $1.62 on revenue of
$2.67 billion vs. $2.69 billion expected. Netflix (NASDAQ:
) reported second quarter EPS of $0.49 vs. $0.40 on revenue of
$1.07 billion, in line. Netflix sees Q3 EPS $0.30-0.56 but revenue
guidance was short of expectations.
Stocks moving in the pre-market included:
Texas Instruments (NASDAQ:
) shares gained 1.95 percent after reporting strong guidance.
) shares fell 5.33 percent after the company reported a better than
expected quarter but guidance was light. Southwest Airlines (NYSE:
) shares declined 1.15 percent after a plane's nose gear collapsed
on landing, but no injuries were reported.
Notable companies expected to report earnings Tuesday
) is expected to report third quarter EPS of $7.31 vs. $9.32 a year
ago on revenue of $35.09 billion vs. $35.00 billion a year ago.
) is expected to report second quarter EPS of $0.68 vs. $0.66 a
year ago on revenue of $31.82 billion vs. $31.6 billion a year ago.
) is expected to report second quarter EPS of $0.92 vs. $1.50 a
year ago on revenue of $30.18 billion vs. $34.66 billion a year
ago. United Technologies (NYSE:
) is expected to report second quarter EPS of $1.58 vs. $1.62 a
year ago on revenue of $16.37 billion vs. $13.81 billion a year
On the economics calendar Tuesday, the weekly Redbook is due out
followed by the FHFA House Price Index and the Richmond Fed
Manufacturing Index while Canada is expected to release its retail
sales report. Also, the Treasury is set to auction 4-week, 52-week,
and 2-year notes. Overnight, the Chinese flash manufacturing PMI is
due out as well as the eurozone, French, and German manufacturing
and services PMIs are due out.
Good luck and good trading.
Tune into Benzinga's PreMarket Info show with Dennis Dick and
For a recap of Monday's market action, read Benzinga's daily
market wrap .
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