Wall Street is riding yesterday's
domestic-data driven wave of euphoria
, with futures on all three major market indexes trading modestly
higher today. While this week's economic activity wraps up with
January's consumer price index (
CPI
), traders are more focused on news from across the pond, where
hope is emerging once again that a bailout plan for debt-laden
Greece will be finalized by Monday. With optimism emanating from
all corners of the globe, the Dow Jones Industrial Average (DJIA)
is set to
extend its stay above the 12,900 mark
, while the broader S&P 500 Index (SPX) is trading north of
breakeven.
In equities news, Gilead Sciences, Inc. (GILD - 54.81) is facing
a 20% drop in pre-market trading, as the pharma concern released an
early morning statement that the bulk of patients being tested with
the company's highly-anticipated hepatitis C drug, GS-7977,
relapsed after just one month of completing the prescribed 12-week
trial period. Today's slide comes on the heels of GILD's recent
trek into
annual-high territory
.
In earnings news, Nordstrom (JWN - 52.18) reported
fourth-quarter net income of $236 million, or $1.11 per share, up
1.7% from $232 million, or $1.04 per share, in the year-ago period.
Meanwhile, retail sales rose by 12.5% to $3.17 billion, boosted by
a 7.1% increase in same-store sales. These figures fell roughly in
line with analysts' predictions for earnings of $1.09 per share on
revenue of $3.17 billion. Looking ahead, JWN is expecting a fiscal
2012 profit of $3.30 to $3.45 per share, while Wall Street is
forecasting full-year earnings of $3.59 per share. JWN is trading
fractionally lower ahead of the bell.
Elsewhere, Applied Materials (AMAT - 13.21) saw its fiscal
first-quarter profit contract 77% to $117 million, or 9 cents per
share, from last year's earnings of $506 million, or 38 cents per
share. Excluding items, AMAT earned 18 cents per share, while
revenue retreated 19% to $2.2 billion. Analysts, on average, were
expecting a profit of 12 cents per share on $1.9 billion in
revenue. For the second quarter, AMAT is targeting earnings of 20
cents to 28 cents per share, with revenue projected to range
between $2.3 billion and $2.52 billion. That forecast is sunnier
than the Street's view, which is calling for a current-quarter
profit of 15 cents per share on $2.08 billion in revenue. AMAT is
up more than 5% in pre-market trading.
Finally, Frontier Communications Corporation (FTR - 4.46) said
its fourth-quarter earnings fell 8.1% to $42.2 million or 4 cents
per share, from last year's profit of $46 million, or 5 cents per
share, on a 9.9% contraction in its subscriber base. Excluding
items, earnings landed at 7 cents per share. Revenue was also on
the decline, dropping 5.6% to $1.28 billion. The results beat
analysts' expectations for a per-share profit of 5 cents on $1.27
billion in sales. FTR also announced it will scale back its
dividend payment by 47% to 10 cents per share, in a move expected
to save the company $87.1 million each quarter. So far this
morning, FTR has been hit with price-target cuts from Citigroup and
Jefferies, but Macquarie raised its rating on the stock to
"neutral." The stock is set to add about 1% right out of the
gate.
Earnings Preview
Today's earnings docket will also feature reports from Campbell
Soup (
CPB
), EOG Resources (
EOG
), H.J. Heinz (
HNZ
), Lincoln Electric (
LECO
), and Pilgrim's Pride (PPC). Keep your browser at
SchaeffersResearch.com
for more news as it breaks.
Economic Calendar
We wrap up the week with the CPI and the Conference Board's
index of leading indicators.
Market Statistics
Equity option activity on the Chicago Board Options Exchange
(CBOE) saw 1,659,764 call contracts traded on Thursday, compared to
1,053,088 put contracts. The resultant single-session put/call
ratio arrived at 0.63, while the 21-day moving average was
0.60.
Overseas Trading
Stocks in Asia ended solidly higher, thanks in part to a batch
of well-received U.S. economic data. Traders also seemed optimistic
that Greece will be able to secure bailout funds, with reports late
Thursday indicating that the European Central Bank (ECB) would
conduct a Greek bond swap to facilitate such a deal. Meanwhile, a
softening yen was supportive of Japanese exporters -- but resource
issues weighed on equities in mainland China amid news of
industry-wide tax hikes. By the close, Japan's Nikkei rose 1.6%,
South Korea's Kospi advanced 1.3%, Hong Kong's Hang Seng added 1%,
and China's Shanghai Composite edged up 0.01%.
The major European benchmarks are also pointed north at
mid-session. Speculation now suggests that Greece could be in line
to receive bailout funds as early as Monday, when euro-zone finance
ministers are scheduled to convene in Brussels. Ahead of the
summit, Greece outlined the spending cuts requested by
international lenders, clearing one obstacle on the path to
receiving additional aid. Sentiment has also been lifted by reports
of the ECB's planned bond maneuvers, as well as another round of
stronger-than-forecast U.S. jobs data. At last check, the German
DAX and French CAC 40 are both 1.3% higher, while London's FTSE 100
is up 0.5%.
Currencies and Commodities
The U.S. dollar index is trading fractionally lower this
morning, last seen at $79.32. Crude oil, meanwhile, continues to
march higher
, with the front-month contract up 0.5% at $103.19 per barrel. Gold
futures are also pointed north, with the malleable metal up 0.3% at
$1,733.20 an ounce.
Unusual Put and Call Activity:
For an explanation of how to use this information, check out our
Education Center
topics on
Option Volume
and
Open Interest Configurations
.
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