U.S. equity futures rose Monday as bond markets remain closed
in observance of Veteran's Day. Over the weekend, Greek lawmakers
voted and passed the austerity budget, making way for the Troika
to release the next tranche of the bailout payments so that
Greece can pay off maturing debt. Also, late Friday night, China
reported that its trade balance rose to 32 billion yuan from 27.7
billion yuan the month before, beating expectations of a drop to
26.85 billion yuan.
In other news around the markets:
- Fitch released cautious comments on Spain overnight,
warning that the deficit is still a concern and that asking for
ESM support would not materially alter ratings.
- Italy's Prime Minister Monti released a statement
indicating that Italy has no intention to ask for a bailout.
Consensus thinking among analysts is that Italy will follow
Spain into an ESM program just to place a cap on borrowing
costs, not because it needs the money.
- The International Energy Agency predicts the U.S. to
overtake Saudi Arabia by 2020 in oil production.
- S&P 500 futures rose 3.6 points to 1,379.85.
- The EUR/USD was flat at 1.2713.
- Spanish 10-year government bond yields rose to 5.87
- Italian 10-year government bond yields rose to 5.001
- Gold futures rose 0.3 percent to $1,736.10 per ounce.
Asian shares were mixed overnight with the strong Chinese
trade data boosting risk sentiment but new data from Japan
showing the economy shrank on a quarterly basis for the first
time in three quarters weighed on sentiment. The Japanese Nikkei
Index fell 0.93 percent and the Shanghai Composite Index rose
0.49 percent while the Hang Seng Index rose 0.21 percent in Hong
Kong. Meanwhile, the Korean Kospi fell 0.19 percent and
Australian shares declined 0.31 percent as a new
report from Reuters
showed that Australian miners may be running out of cash.
European shares were mostly higher in early trading following
the Greek vote. However, the Spanish Ibex Index did trade lower
by 0.57 percent while the Italian MIB Index rose 0.16 percent and
Greek shares rose 0.4 percent. Also, the German DAX rose 0.25
percent and the French CAC 40 Index fell 0.08 percent. Lastly,
U.K. shares rose 0.22 percent in London trading.
Commodities were mixed overnight with energy futures weighing
on commodities. WTI Crude futures fell by 0.2 percent to $85.90
per barrel and Brent Crude futures fell 0.29 percent to $109.08
per barrel. Copper futures rose 0.04 percent to $344.70 per
pound, boosted by the stronger than expected Chinese trade data.
Gold was higher and silver futures rose 0.29 percent to $32.70
Currency markets were tepid overnight with moves restricted to
tight ranges save for the Aussie dollar, which showed marginal
strength. The EUR/USD was flat at 1.2713 and the dollar fell
against the yen to 79.40 as U.S. bond yields continue to tighten.
Overall, the Dollar Index was flat overnight with strength seen
against the Canadian dollar and the Swiss franc and weakness
against the Swedish krone and the yen. Also, the AUD/USD rose 44
pips, or 0.42 percent, to 1.0431 in overnight trade and the
Aussie was also stronger against the yen and the euro, with the
EUR/AUD pair falling 52 pips or 0.42 percent to 1.2185, the
lowest level since mid-August.
Stocks moving in the pre-market included:
- Titanium Metals Crop. (NYSE:
) shares rose 41.4 percent in pre-market trading has the
company has entered a definitive arrangement to be bought by
Precision Castparts (NYSE:
- Coca Cola (NYSE:
) shares rose 0.72 percent on positive comments on Seeking
Alpha and the Motley Fool.
- Time Warner (NYSE:
) shares rose 0.65 percent as the latest installment of the
Bond series, Skyfall, had the greatest opening of any Bond
movie in history.
- Caterpillar (NYSE:
) shares fell 0.68 percent as investors fear that the fiscal
cliff will lead to a drop in orders.
- Apple (NASDAQ:
) shares continued to climb in pre-market trading, rising 0.54
percent after a 1.73 percent gain on Friday.
Notable companies expected to report earnings Monday
- Beazer Homes (NYSE:
) is expected to report a fourth quarter loss of $1.22 vs. a
loss of $2.90 a year ago.
- Focus Media Holding Ltd. (NASDAQ:
) is expected to report third quarter EPS of $0.70 vs. $0.59 a
year ago. The company has been the subject of criticism
following negative comments from Muddy Waters Reasearch over a
- Weatherford International (NYSE:
) is expected to report third quarter EPS of $0.23 vs. $0.26 a
- Wesco Aircraft Holdings (NYSE:
) is expected to report fourth quarter EPS of $0.24 vs. $0.24 a
In honor of the Veteran's Day holiday celebrated Sunday,
economic data releases will be delayed until Tuesday in the U.S.
Overnight Monday into Tuesday, French Non-Farm Payrolls and the
German ZEW Economic Survey are due out.
Good luck and good trading.
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