Futures Rise Into GDP Report As Metals Meltdown
U.S. equity futures rose in early pre-market trade ahead of the
final look at first quarter GDP. Economist expect that the economy
grew 2.4 percent in the quarter with PCE inflation rising 1.1
In other news around the markets:
European Central Bank President Mario Draghi spoke overnight,
saying that monetary policy cannot achieve real economic growth and
that this puts a limit on what central banks can do. These comments
seem rather cautious and untimely given the markets perceptions of
tapering and stimulus withdrawal as of late. The German IFO
Institute cut its 2013 growth forecast for Germany to 0.6 percent
from 0.7 percent but is still above the government's forecast of
0.5 percent and the Bundesbank's forecast of 0.3 percent growth.
France's economy contracted 0.2 percent in the first quarter, in
line with estimates and the same from the prior reading. On an
annualized basis, France's economy contracted 0.4 percent. S&P
500 futures rose 4.1 points to 1,585.50. The EUR/USD was lower at
1.3046. Spanish 10-year government bond yields fell 4 basis points
to 5.05 percent. Italian 10-year government bond yields 4 basis
points to 4.82 percent. Gold plunged 3.22 percent to $1,234.10 per
Asian shares were mixed overnight as Japanese weakness was
offset by strength in other regional markets. The Japanese Nikkei
225 Index fell 1.04 percent and the Topix Index declined 0.87
percent. In Hong Kong, the Hang Seng Index rose 2.43 percent and
the Shanghai Composite Index gained 0.06 percent in China. Also,
the Korean Kospi rose 0.16 percent and Australian shares rose 1.63
percent despite Prime Minister Gillard losing a confidence vote in
European shares rose markedly and traded near session highs in
early trade. The Spanish Ibex Index rose 1.63 percent and the
Italian FTSE MIB Index gained 1.35 percent. Meanwhile, the German
DAX rose 1.27 percent and the French CAC 40 gained 1.37 percent
while U.K. shares rose 0.87 percent.
Commodities were mixed overnight as metals plunged. WTI Crude
futures fell 0.29 percent to $95.04 per barrel and Brent Crude
futures rose 0.17 percent to $101.43 per barrel. Copper futures
dropped 1.37 percent to $303.40 per pound. Gold was much lower and
silver futures were by far the weakest, dropping 5.23 percent to
$18.53 per ounce.
Currency markets were not to blame for the move in metals
overnight as moves in major pairs were rather tepid. The EUR/USD
was lower at 1.3046 and the dollar fell against the yen by 0.28
percent to 97.54. Overall, the Dollar Index gained 0.16 percent on
strength against the euro, the pound, and the Swiss franc.
Earnings Reported Yesterday
Key companies that reported earnings Tuesday include:
Apollo Group (NASDAQ:
) reported third quarter EPS of $1.05 vs. $0.85 expected on revenue
of $946.8 million vs. $965.07 million previous. Barnes and Noble
) reported a fourth quarter loss of $2.11 per share vs. the
expected loss of $0.99 per share on revenue of $1.28 billion vs.
$1.33 billion expected. Carnival Corp. (NYSE:
) reported second quarter EPS of $0.09 vs. $0.06 expected on
revenue of $3.5 billion vs. $3.56 billion expected. Lennar (NYSE:
) reported second quarter EPS of $0.43 vs. $0.33 expected on
revenue of $1.43 billion vs. $1.33 billion. Walgreen's (NYSE:
) reported third quarter EPS of $0.85 vs. $0.91 a year ago on
revenue of $18.31 billion vs. $18.45 billion a year ago.
Stocks moving in the pre-market included:
Apollo Group (NASDAQ:
) shares declined 4.54 percent pre-market on the revenue miss.
Newmont Mining (NYSE:
) shares fell 2.77 percent pre-market as gold prices sank. Silver
) shares plunged 4.1 percent pre-market as silver prices dropped
more than 5 percent. Las Vegas Sands (NYSE:
) shares declined 1.18 percent pre-market after the company
announced that its CFO is leaving the company.
Notable companies expected to report earnings Wednesday
Bed Bath and Beyond (NASDAQ:
) is expected to report is expected to report first quarter EPS of
$0.93 vs. $0.89 a year ago. General Mills (NYSE:
) is expected to report fourth quarter EPS of $0.53 vs. $0.60 a
year ago. Monsanto (NYSE:
) is expected to report third quarter EPS of $1.61 vs. $1.63 a year
ago. Progress Software (NASDAQ:
) is expected to report EPS of $0.22 vs. $0.21 a year ago.
On the economics calendar Wednesday, Minnesota Fed President
Naryana Kocherlakota is set to speak in Seoul overnight and will be
a guest on CNBC's Squawk Box at 6:30 am. Later, MBA Purchase
Applications and the much-anticipated GDP report are due out.
Later, the Dallas Fed President Richard Fisher and the New York Fed
President William Dudley are also expected to speak and the
Treasury will auction 5-year notes. Overnight, the German
Unemployment Report and British GDP are expected.
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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