U.S. equity futures were flat Thursday ahead of interest rate
decisions from both the European Central Bank and the Bank of
England. Also, overnight Greek leaders approved the latest round
of austerity measures by a narrow margin, paving the way for
Greece to get its next round of bailout funding from the
In other news around the markets:
- Markets sold off strongly on Wednesday one day after
President Obama was reelected for a second term as investors
feared that a stalemate in Congress would lead to leaders being
unable to reach a deal and sending us over the fiscal
- The People's Bank of China Governor Zhou spoke overnight,
saying that the economy has recently shown signs of improvement
and the PBOC will stand ready to act if necessary. China's
leadership changeover begins today.
- Spain auctioned 3-, 6-, and 20-year bonds in a rather
strong auction with yields falling and the bid-to-cover ratios
- S&P 500 futures were flat at 1,398.20.
- The EUR/USD was much weaker at 1.2734.
- Spanish 10-year government bond yields rose to 5.817
- Italian 10-year government bond yields rose to 5.017
- Gold rose 0.04 percent to $1,714.70.
Asian shares were all weaker overnight in response to the
sharp sell-off on Wall Street Wednesday. The Japanese Nikkei
Index fell 1.51 percent and the Shanghai Composite Index fell
1.63 percent while the Hang Seng Index fell 2.41 percent in Hong
Kong trading. Meanwhile, the Korean Kospi fell 1.19 percent and
Australian shares fell only 0.72 percent as strong employment
data minimized losses.
European shares were mixed with weakness seen in Spain and
Italy as Italian bad bank loans rose 15.3 percent in September.
Spain's Ibex Index dropped 0.37 percent and the Italian MIB Index
fell 1.11 percent while Greek shares rose 0.23 percent. Core
stocks were stronger, as the German DAX rose 0.36 percent and the
French CAC 40 rose 0.18 percent while U.K. shares rose 0.18
Commodities were mostly stronger in early Wednesday trade
following broad sell-offs in the commodity complex Wednesday (oil
fell more than 4 percent). WTI Crude futures rose 0.68 percent to
$85.01 per barrel and Brent Crude futures rose 0.6 percent to
$107.46 per barrel. Copper futures were weaker on global growth
fears, sliding 0.15 percent to $343.65 per pound. Gold was higher
and silver futures rose 0.06 percent to $31.68.
Currency markets showed broad euro weakness in overnight
trading ahead of the ECB. The EUR/USD was lower at 1.2734 and the
dollar fell against the yen to 79.86. Overall, the Dollar Index
rose 0.2 percent to 80.92 on strength against the euro, the
pound, and the Swedish Krone. The euro was broadly weak, falling
against the U.S. dollar, the yen, and the Aussie dollar; the
EUR/AUD cross is trading at its lowest levels since late
Stocks moving in the pre-market included:
- VirentX Holding Corp. (NYSE:
) shares fell 1.07 percent pre-market following a 27 percent
gain Wednesday as the company won a lawsuit against Apple
- Merck and Co. (NYSE:
) shares fell 0.58 percent pre-market following the weak
earnings from Vivus (NASDAQ:
) which sent its shares to the lowest level on record.
- Shares of the Southern Company (NYSE:
) rose 0.33 percent as fears over dividend payers in the higher
tax environment after the fiscal cliff receded.
- Marathon Petroleum Corp. (NYSE:
) shares rose 0.43 percent pre-market as the company was
highlighted at Zacks Equity Research.
There are several notable companies expected to report
earnings Thursday, including:
- Duke Energy (NYSE:
) is expected to report third quarter EPS of $1.45 vs. $1.50 a
- International Game Technology (NYSE:
) is expected to report fourth quarter EPS of $0.32 vs. $0.24 a
- Kohl's (NYSE:
) is expected to report third quarter EPS of $0.86 vs. $0.80 a
- NVIDIA (NASDAQ:
) is expected to report third quarter EPS of $0.30 vs. $0.29 a
- Walt Disney (NYSE:
) is expected to report third quarter EPS of $0.68 vs. $0.59 a
year ago and should comment on the recent Lucasfilm
- Zipcar (NASDAQ:
) is expected to report third quarter EPS of $0.01 vs. $0.02 a
On the economic calendar Thursday, all eyes are on the
European Central Bank and the Bank of England. Neither Bank is
expected to cut rates nor expand any existing non-traditional
policies; however there are some economists who have said a rate
cut by the ECB could lead to a boost to growth. Also, jobless
claims and trade data are due out. Lastly, the Fed's James
Bullard is set to speak tonight at Washington University in St.
Good luck and good trading.
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