Futures Lower On Weak China Trade Data, Eyeing FOMC Minutes
U.S. equity futures dropped slightly in early pre-market trade
following some weak trade data from China for June. The world's
second largest economy reported slower than expected growth in both
exports and imports but a wider than forecast trade surplus,
indicating that the export engine of the country cooled in
In other news around the markets:
China reported that its exports declined 3.1 percent in June from a
year ago vs. an expected gain of 4 percent while imports dropped
0.7 percent vs. an expected 8.0 percent gain. The trade surplus
widened to $27.1 billion vs. the forecast $27.0 billion and showed
improvement from May. Eurozone leaders reached an agreement on
winding down failing banks despite German reticence. Leaders agreed
that the EU can wind down failing banks, not individual countries,
a key point that Germany would not endorse. European Central Bank
Board Member and Banque de France chief Christian Noyer spoke
overnight saying that monetary policy will remain accommodative for
as long as necessary, reflecting comments of ECB President Mario
Draghi last week. He noted that price and financial stability will
be key in the ECB's decision to eventually raise rates. S&P 500
futures fell 2 points to 1,643.60. The EUR/USD was higher at
1.2817. Spanish 10-year government bond yields rose 5 basis points
to 4.79 percent. Italian 10-year government bond yields rose 7
basis points to 4.48 percent. Gold rose 0.47 percent to $1,251.70.
Asian shares were mixed overnight as Japanese shares declined
while Chinese equities rallied on hopes of new stimulus following
weaker export and import data. The Japanese Nikkei 225 Index
declined 0.39 percent and the Topix Index fell 0.14 percent. In
Hong Kong, the Hang Seng Index rose 1.07 percent while the Shanghai
Composite Index gained 2.17 percent in China. Also, the Korean
Kospi fell 0.34 percent and Australian shares rose 0.4 percent.
European shares were lower in early trade following the new bank
rules. The Spanish Ibex Index declined 1.02 percent and the Italian
FTSE MIB Index lost 1.04 percent. Meanwhile, the German DAX
declined 0.34 percent and the French CAC 40 Index fell 0.29 percent
while U.K. shares lost 0.2 percent.
Commodities were stronger overnight as the dollar weakened. WTI
Crude futures rose 1.23 percent to $104.80 per barrel and Brent
Crude futures gained 0.43 percent to $108.27 per barrel. Copper
futures rose 0.13 percent to $306.85 per pound. Gold was higher and
silver futures rose 0.3 percent to $19.30 per ounce.
Currency markets were on the move overnight as the dollar
weakened across the board. The EUR/USD was higher at 1.2817 and the
dollar fell against the yen to 100.12. Overall, the Dollar Index
fell 0.31 percent on weakness against the yen, the Swiss franc, the
euro, and the pound.
Earnings Reported Yesterday
Key companies that reported earnings Tuesday include:
Wolverine World Wide (NYSE:
) reported second quarter EPS of $0.46 vs. $0.34 expected on
revenue of $587.8 million vs. $591.03 million expected. The company
also raised full year earnings guidance.
Stocks moving in the pre-market included:
Hewlett-Packard (NYSE; HPQ) shares gained 1.92 percent pre-market
after Brean Capital raised the stock to buy from hold and announced
a $32 price target. Cummins Inc. (NYSE:
) shares gained 0.56 percent pre-market after the company raised
its quarterly dividend to $0.625 per share from $0.50 per share.
) shares gained 0.74 percent pre-market as the company raised its
quarterly dividend to $0.25 per share from $0.20. Nu Skin
) shares spiked 13.87 percent pre-market after the company raised
EPS guidance well above the street's estimates.
Notable companies expected to report earnings Wednesday
Yum! Brands (NYSE:
) is expected to report second quarter EPS of $0.54 vs. $0.67 prior
on revenue of $2.93 billion vs. $3.17 bill prior. Family Dollar
) is expected to report third quarter EPS of $1.03 vs. $1.06 on
revenue of $2.57 billion vs. $2.36 billion expected. Fastenal
) is expected to report second quarter EPS of $0.41 vs. $0.38 prior
on revenue of $857.13 million vs. $804.89 million. PriceSmart
) is expected to report third quarter EPS of $0.64 vs. $0.52 on
revenue of $568.33 million vs. $506.77 million a year ago. Ruby
) is expected to report fourth quarter EPS of $0.18 vs. $0.26 on
revenue of $326.06 million vs. $363.21 million a year ago.
On the economics calendar Wednesday, MBA Purchase Applications
are due out followed by wholesale trade data. However, all eyes
will be on the release of the FOMC minutes for June and the speech
from Chairman Ben Bernanke as to when tapering might start.
Overnight, the Australian employment report, the Bank of Japan
decision and press conference, and the ECB monthly report are all
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
advice. All rights reserved.
Profit with More New & Research
. Gain access to a streaming platform with all the information you
need to invest better today.
Click here to start your 14 Day Trial of Benzinga