Futures Gain On Stronger Chinese Data
U.S. equity futures gained in early pre-market trade following
some better than expected Chinese inflation data. The new data
eased fears that the world's second largest economy is headed for a
sharp contraction amid a financial liquidity crisis.
In other news around the markets:
Chinese CPI was flat in June from May vs. an expected drop of 0.2
percent and much better than the prior reading of a drop of 0.6
percent. On an annualized basis, CPI inflation rose 2.7 percent
from a year ago vs. the expected gain of 2.5 percent and the prior
reading at 2.1 percent while PPI inflation declined 2.5 percent in
June, better than the expected declined of 2.7 percent and prior
decline of 2.9 percent. U.K. industrial production unexpectedly
stalled in June, posting a flat reading from May vs. an expected
gain of 0.2 percent while May's figure was revised lower to -0.1
percent from 0.1 percent. Manufacturing production in particular
was weak in June. Intuitive Surgical (NASDAQ:
) after the close issued some guidance for the second quarter and
now sees EPS between $3.86 and $3.98 vs. the consensus estimate of
$4.29. Revenue is expected to be $537-575 million vs. $629.61
million expected. Amarin (NASDAQ:
) announced a stock offering of 21.7 million shares after the
close, sending the stock lower after-hours. The issuance represents
nearly one-sixth of total shares. S&P 500 futures rose 7.3
points to 1,642.80. The EUR/USD was higher at 1.2873. Spanish
10-year government bond yields fell 1 basis points to 4.67 percent.
Italian 10-year government bond yields fell 2 basis points to 4.36
percent. Gold rose 1.56 percent to $1,254.20 per ounce.
Asian shares rose overnight on the back of the stronger Chinese
inflation data as investors see the data as confirmation that China
can withstand a financial liquidity crisis without a hard landing
of the economy. The Japanese Nikkei 225 Index rose 2.58 percent and
the Topix Index rose 2.07 percent. In Hong Kong, the Hang Seng
Index gained 0.49 percent and the Shanghai Composite Index rose
0.37 percent in China. Also, the Korean Kospi gained 0.74 percent
and Australian shares rose 1.5 percent.
European shares were higher in early trade on the back of the
positive data out of China. The Spanish Ibex Index gained 0.73
percent and the Italian FTSE MIB Index rose 0.79 percent.
Meanwhile, the German DAX rose 1.04 percent and the French CAC 40
Index gained 0.76 percent while U.K. shares climbed 1.05
Commodities were mixed as energy futures dropped while metals
gained. WTI Crude futures fell 0.15 percent to $102.99 per barrel
and Brent Crude futures declined 0.2 percent to $107.22 per barrel.
Copper futures fell 0.94 percent to $307.05 per pound. Gold was
higher and silver futures gained 1.53 percent to $19.33 per
Currency markets were rather quiet save for the pound which
declined on the weak industrial production data as the weak figures
point to renewed stimulus efforts from the Bank of England, which
would most likely devalue the currency. The EUR/USD was higher at
1.2873 and the dollar gained against the yen to 101.19. Overall,
the Dollar Index rose 0.09 percent on strength against the pound,
the yen, and the Swiss franc. Notably, the GBP/USD declined 0.45
percent to 1.4882 and the EUR/GBP rose 0.5 percent to 0.8650,
marking solid declines for the sterling.
Earnings Reported Yesterday
Key companies that reported earnings Monday include:
) reported second quarter adjusted EPS of $0.07 vs. $0.06 expected
on revenue of $5.85 billion vs. $5.83 billion expected. WD 40
) reported third quarter EPS of $0.66 vs. $0.56 expected on revenue
of $93.1 million vs. $89.45 million expected.
Stocks moving in the pre-market included:
) shares rose 1.39 percent in pre-market trade as shares whipsawed
between positive and negative territory following the earnings
release. Intuitive Surgical (NASDAQ:
) shares plummeted 11.31 percent on the weak second quarter
guidance. Amarin (NASDAQ:
) shares declined 10.21 percent pre-market following the stock
issuance. Sprint (NYSE:
) shares rose 0.99 percent pre-market as 97 percent of shareholders
opted to take cash and new stock as part of the Softbank deal
following the approval of the takeover of Clearwire (NASDAQ:
) by Clearwire shareholders.
Notable companies expected to report earnings Tuesday
) is expected to report second quarter EPS of $0.16 vs. $0.33 a
year ago on revenue of $154.16 million vs. $184.00 million prior.
Healthcare Services Group (NASDAQ:
) is expected to report second quarter EPS of $0.20 vs. $0.17 a
year ago on revenue of $281.77 million vs. $267.11 million a year
ago. Wolverine World Wide (NYSE:
) is expected to report second quarter EPS of $0.34 vs. $0.48 a
year ago on revenue of $591.03 million vs. $312.72 million a year
On the economics calendar Tuesday, the NFIB Small Business
Optimism Index is due out followed by the weekly Chain Store Sales
and Redbook reports. Also, the Treasury is set to hold a 4-week
bill and 3-year note auction. Overnight, the Chinese trade report
is 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 .
(c) 2013 Benzinga.com. Benzinga does not provide investment
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