U.S. stocks are looking to shrug off Friday's losses in the face
of a stabilization plan for the struggling European Union banking
and without giving specifics, German Chancellor Angela Merkel and
French President Nicolas Sarkozy said they will reveal further
details about recapitalizing EU banks over the coming weeks. On the
home front, it could be a volatile, low-volume session on Wall
Street today, as there are no major economic or earnings reports
due out, while government offices and bond markets are closed for
Columbus Day. Against this backdrop, futures are headed higher
across the board, with the Dow Jones Industrial Average (DJIA)
sitting 147 points above breakeven, and the broader S&P 500
Index up over 19 points ahead of the bell.
In earnings news, Natus Medical (BABY - 8.63) confessed its
preliminary fiscal third-quarter results this morning, with the
firm predicting revenue of approximately $51.5 million -- below its
July forecast for $58 million. In a company statement, CEO Jim
Hawkins attributed the shortfall to delayed orders in the neurology
and newborn care divisions. Additionally, BABY updated its
fourth-quarter forecast, with the company now anticipating an
adjusted profit of 15 cents per share on revenue of $65 million.
The healthcare concern's previous outlook called for earnings of 19
to 20 cents per share on $61 million, while analysts were looking
for a profit of 19 cents per share on $67.5 million in revenue.
Shares of BABY are headed 3% lower in pre-market trading.
Elsewhere, Scotts Miracle-Gro (SMG - 46.95) slashed its
full-year earnings forecast to a range between $2.70 and $2.75 per
share, down from its August guidance of $2.95 to $3.05 per share.
The firm also said it anticipates a 2% sales decline for fiscal
2011, with the complete full-year results scheduled to hit the
Street on Tuesday, Nov. 8. The lawn-care specialist attributed the
downwardly revised outlook to "an unexpected year-over-year decline
in consumer purchases in the U.S. during September." Analysts were
expecting SMG to bank a full-year profit of $2.98 per share on
$2.85 billion in revenue.
In equities news, Superior Energy Services (SPN - 27.41) and
Complete Production Services (CPX - 20.38) confirmed their deal to
merge, combining the two businesses into a single oilfield services
company. Under the terms of the agreement, SPN will shell out 0.945
share of stock and $7 in cash for each CPX share, representing a
healthy 61% premium to Friday's close at $20.38. SPN and CPX
shareholders will hold about 52% and 48% of its outstanding shares,
respectively. Ahead of the bell, CPX is looking to start the
trading day with a 50.2% boost, while SPN is staring at a 9%
Today's earnings docket will feature a report from Mistras Group
). Keep your browser at
for more news as it breaks.
The economic calendar is bare today, as government offices are
closed in honor of Columbus Day. On Tuesday, the central bank will
take the spotlight, with the release of the Federal Open Market
Committee's (FOMC) latest meeting minutes on tap. The economic
agenda is relatively light on Wednesday, with the MBA mortgage
index slated for release. Meanwhile, Thursday heats up with the
August trade balance, the holiday-delayed crude inventories report,
and the weekly report on initial jobless claims. Friday winds down
with September retail sales data, the Reuters/UMich consumer
sentiment index, business inventories, and import/export
Equity option activity on the Chicago Board Options Exchange (
) saw 820,148 call contracts traded on Friday, compared to 566,876
put contracts. The resultant single-session put/call ratio arrived
at 0.69, while the 21-day moving average was 0.72.
Asian benchmarks ended mostly higher today, buoyed by optimism
over a potential plan to shore up the European banking sector.
Despite speculation about a rift between Merkel and Sarkozy, the
duo said they're in "total" agreement regarding a plan to
recapitalize banks. However, property stocks were a pocket of
weakness in China, after data revealed a monthly decline in home
prices. By the close, South Korea's Kospi added 0.4%, Hong Kong's
Hang Seng edged up 0.02%, and China's Shanghai Composite slipped
0.6%. Markets in Japan are closed for holiday.
The united front presented by Merkel and Sarkozy has also
inspired some bullish tidings over in Europe, although details
about a banking rescue won't be available until later this month.
In the meantime, Greek financials have taken a turn for the worse
after the Bank of Greece moved to nationalize struggling Proton
Bank, while the Belgian government agreed to acquire certain assets
from troubled lender Dexia. At midday, London's FTSE 100 is up 1.1
%, the French CAC 40 is 1% higher, and the German DAX has gained
Currencies and Commodities
The greenback is trading modestly lower this morning, with the
U.S. dollar index down 1.2% at last look. Elsewhere, crude futures
have extended their recent gains, with the front-month contract up
1.8% to trade near $84.46 per barrel. Gold futures are also on the
rise, reversing Friday's loss. At last check, the malleable metal
has added on $30.10, or 1.8%, to flirt with $1,665.90 an ounce.
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