Opening View: Stocks Ready to Rebound; Street Cheers FedEx Outlook


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The Dow Jones Industrial Average (DJIA ) extended its retreat on Wednesday, as Japan's nuclear crisis kept the Street in "sell" mode. However, the blue chip barometer was the only one of its peers to remain in the black for the year, with the S&P 500 Index (SPX ) and Nasdaq Composite (COMP ) now harboring year-to-date deficits of 0.06% and 1.4%, respectively. However, futures are higher ahead of the bell, with all three major market indexes poised to rebound from yesterday's drubbing. Fueling the pre-market optimism is a strong outlook from FedEx Corp. ( FDX ) , news that Japan is making progress at its crippled nuclear plant, as well as an emergency conference call among the Group of Seven ministers later tonight.

At last check, the Dow was trading more than 150 points above fair value, the SPX was last seen 11 points higher, while the tech-rich COMP is poised to open with a gain of roughly 17 points.

In equities news, FedEx Corp. ( FDX ) said net profit for the fiscal third quarter fell 3% to $231 million, or 73 cents per share, compared to $239 million, or 76 cents per share, in the year-ago period. Excluding items, FDX earned 81 cents per share. Revenue, meanwhile, jumped 11% to $9.66 billion. Analysts, on average, predicted per-share earnings of 82 cents per share on sales of $9.61 billion. Looking ahead, the package delivery concern sees fourth-quarter earnings in a range of $1.66 per share to $1.83 per share, and projected full-year adjusted earnings-per-share of $4.83 to $5.00. The guidance came in above expectations, with the Street estimating fourth-quarter and full-year per-share earnings of $1.65 and $4.87, respectively.

Meanwhile, Lululemon Athletica ( LULU ) unveiled a fourth-quarter profit of $55 million, or 76 cents per share. Excluding items, LULU earned 64 cents per share, while revenue climbed 53% to $245.4 million. Wall Street was expecting a profit of 57 cents per share on revenue of $239.3 million. However, LULU predicted first-quarter revenue of $175 million to $180 million, just short of analysts' average forecast of $180.6 million.

Finally, Winnebago Industries ( WGO ) reported a fiscal second-quarter profit of $3.3 million, or 11 cents per share. Revenue for the quarter dipped slightly to $106.6 million. The bottom-line results were better than expected, with analysts calling for a profit of 6 cents per share on revenue of $116.4 million.

Earnings Preview

On the earnings front, Ross Stores ( ROST ), LDK Solar Co., Ltd. ( LDK ), Nike Inc. (NKE), and Shoe Carnival Inc. (SCVL) are slated to release their quarterly earnings reports. Keep your browser at for more news as it breaks.

Economic Calendar

The economic calendar will wind down today with the government's weekly jobless claims and the Conference Board's index of leading indicators, as well as the latest data on consumer prices, industrial production, and manufacturing activity in the Philadelphia region.

Market Statistics

Equity option activity on the Chicago Board Options Exchange (CBOE) saw 1,540,335 call contracts traded on Wednesday, compared to 1,223,418 put contracts. The resultant single-session put/call ratio jumped to 0.72, while the 21-day moving average edged higher to 0.61.

Volatility indices

NYSE and Nasdaq summary

Dow, S&P and Nasdaq futures

Trading the News: A Contrarian View. Check out this special report from Bernie Schaeffer here.

Overseas Trading

Asian markets fell today, after Nuclear Regulatory Commission Chairman Greg Jaczko said the risk of radiation at Japan's crippled nuclear power plant was more serious than previously thought. However, attempts to cool down the reactors sparked optimism, helping stocks pare their losses by the close. By the time the dust settled, Japan's Nikkei dropped 1.4%, Hong Kong's Hang Seng fell 1.8%, and the Shanghai Composite dipped 1.1%.

Elsewhere, European markets were also on the rebound, as traders await an emergency conference call of the Group of Seven finance leaders and central-bank governors at 6 p.m. Eastern time. Japan's finance minister is reportedly expected to explain the country's earthquake damage, and discuss the financial fallout from the disaster. At last check, the French CAC 40 was up 0.9%, the German DAX was up nearly 1%, and London's FTSE 100 was bucking the trend with a loss of 1.7%.

Overseas markets

Currencies and Commodities

The U.S. dollar is poised to give back some of its gains this morning, as the U.S. Dollar Index was seen down nearly 1% at 75.93. Elsewhere, crude futures are headed higher; in electronic trading, the April crude futures contract has added 1.8% to $100.70 per barrel. Finally, gold futures have also powered into the black, advancing 0.4% to flirt with the $1,401.40 level.

Currencies and commodities

Unusual Put and Call Activity:

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Unusual options activity - puts

Unusual options activity - calls

Every morning, our research staff analyzes the prior day and the overnight markets, and monitors the morning wires to give you an accurate preview of the day to come. If you enjoyed today's edition of Opening View, sign up here for free daily delivery, straight to your inbox, before the opening bell.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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This article appears in: Investing Options
Referenced Stocks: FDX , LDK , LULU , ROST , WGO

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