U.S. stocks are pointed lower today, as Wall Street digests the
latest earnings results from blue-chip banking behemoth JPMorgan
). While the firm's per-share profit topped expectations, its
credit-loss provisions jumped by one-third from the second quarter,
reflecting a cautious outlook. Elsewhere, the latest data from
China has also set a gloomy tone ahead of the bell, after the
country's trade surplus narrowed for a second straight month in
September. Against this backdrop, the major market indexes are
hovering south of breakeven, with the Dow Jones Industrial Average
(DJIA) bracing for a 79-point drop out of the gate.
In earnings news, JPMorgan Chase (JPM - 33.20) said
third-quarter earnings fell 3.5% to $4.26 billion, or $1.02 per
share, while revenue edged 0.1% higher to $24.37 billion. The
results surpassed Wall Street's expectations, with analysts calling
for a per-share profit of 91 cents on sales of $23.4 billion.
Meanwhile, the bank's third-quarter credit-loss provisions rose 33%
from the second quarter, which reflects its "more cautious credit
outlook," CEO Jamie Dimon told shareholders. Ahead of the bell, JPM
is pointed 0.8% lower.
Elsewhere, XL Group (XL - 19.80) last night predicted it will
swallow a third-quarter loss, pre-tax and net of reinsurance and
reinstatement premiums, of $90 million to $120 million. XL's
insurance business generated the bulk of the losses, due to a
string of catastrophes during the three-month period -- including
Hurricane Irene and Tropical Storm Lee, as well as the Texas
wildfires. The Dublin-based insurer is scheduled to report its full
third-quarter results in early November.
Finally, Universal Forest Products (UFPI - 25.94) said its
third-quarter profit jumped 117% to $5.6 million, or 29 cents per
share, from last year's earnings of $2.6 million, or 13 cents per
share. Revenue decreased 2.4% to $468.9 million, from $480.6
million. UFPI's results failed to meet analysts' expectations for a
profit of 32 cents per share on $471.5 million in revenue. "Our
cost-cutting efforts and a more stable lumber market helped us
generate a stronger profit in the quarter," claimed CEO Matthew J.
Missad. However, he predicted the economy to "remain weak for the
near term," and said that uncertainties in the housing market will
limit the company's ability to provide meaningful guidance.
Today's earnings docket will also feature reports from Google (
), Fastenal (
), Lindsay Corp. (
), and Valmont Industries (
). Keep your browser at
for more news as it breaks.
The August trade balance, the holiday-delayed crude inventories
report, and the weekly report on initial jobless claims are slated
for release today. Meanwhile, Friday winds down with September
retail sales data, the Reuters/UMich consumer sentiment index,
business inventories, and import/export prices.
Equity option activity on the Chicago Board Options Exchange
(CBOE) saw 1,070,265 call contracts traded on Wednesday, compared
to 678,094 put contracts. The resultant single-session put/call
ratio arrived at 0.63, while the 21-day moving average was
Stocks in Asia ended higher today, as signs of progress in
Europe whetted the collective appetite for riskier assets. However,
China's trade surplus eased by more than expected in September,
marking the second straight monthly decline. Furthermore, exports
and imports grew by less than expected last month. Nevertheless,
exporters -- along with property developers and resource-related
equities -- paced the advance in China and Japan. By the close,
Japan's Nikkei added 1%, China's Shanghai Composite tacked on 0.8%,
and Hong Kong's Hang Seng gained 2.3%.
On the other hand, European markets are mostly lower at midday,
with bank stocks leading the retreat ahead of a highly anticipated
Italian debt auction. In France, retailer Carrefour SA has given up
more than 5% after cutting its outlook, while Alcatel-Lucent is
leading the elite advancers after the
reported that the firm has agreed to sell its call-center services
business. At last check, London's FTSE 100 has given up 0.9%, while
both France's CAC 40 and Germany's DAX have shed 1.1%.
Currencies and Commodities
The greenback is on the rebound this morning, with the U.S.
dollar index up 0.4% at last look. Elsewhere, crude futures have
continued their retreat ahead of the government's holiday-delayed
inventory report, with the front-month contract down $1.52, or
1.8%, to trade near $84.26 per barrel. Finally, gold futures have
pared some of their recent gains, with the precious metal last seen
$13, or 0.8%, lower at $1,669.60 an ounce.
Unusual Put and Call Activity:
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