The Dow Jones Industrial Average (DJIA) took a nosedive late on
Wednesday, after Federal Reserve Chairman Ben Bernanke described
the U.S. economic outlook as "unusually uncertain." However true
the statement may have been, the grim choice of words was
unfortunate for Wall Street, as the DJIA plummeted to a
triple-digit loss. Fortune is smiling this morning, however, as the
parade of earnings from Dow-component Caterpillar Inc. (
CAT
), 3M Company (
MMM
), and AT&T Inc. (
T
) is being well received. In fact, futures on the DJIA are
currently trading about 91 points above fair value, pointing toward
a solid start to the regular session of trading. Look for
resistance to materialize near the 10,250 level early in the day,
with 10,350-10,400 capping any major rally in the Dow. Finally, the
S&P 500 Index (SPX) is poised for an opening jump of nearly 10
points, which would place the SPX in contention with key short-term
resistance in the 1,080-1,085 region.
In earnings news, 3M Company (
MMM
) posted a second-quarter profit of $1.12 billion, or $1.54 per
share, as revenue rose to $6.73 billion. Wall Street analysts
expected 3M to post earnings of $1.47 per share on revenue of $6.62
billion. Looking ahead, the company lifted its 2010 adjusted
earnings target to $5.65-$5.80 per share from its earlier
expectation of $5.40-$5.60 per share.
Elsewhere, Caterpillar Inc. (
CAT
) reported that its second-quarter profit climbed by 91% to $707
million, or $1.09 per share, as revenue rose to $10.4 billion.
Analysts were looking for a profit of 83 cents per share, on
revenue of $9.6 billion. Caterpillar also lifted its 2010 outlook
to $3.15 to $3.85 per share, from its earlier view of $2.50 to
$3.25 per share. "While there are significant economic concerns
around the world that we are watching closely, orders have
continued to outpace our shipments, and we expect to increase
production in the second half of the year," the company said.
Finally, AT&T Inc. (
T
) reported net second-quarter income of $4.0 billion, or 68 cents
per share, with revenue rising to $30.8 billion. Excluding a
onetime gain, AT&T earned 61 cents per share, topping the
consensus estimate for earnings of 57 cents per share. For 2010,
AT&T upped its forecast due to expectations for "strong
earnings per share growth" and higher free cash flow compared to
the prior year.
Earnings Preview
On the earnings front Akeena Solar Inc. (AKNS), The Blackstone
Group LP (
BX
), Bristol-Myers Squibb Co. (
BMY
), Continental Airlines Inc. (
CAL
), Eli Lilly & Co. (
LLY
), Fifth Third Bancorp (
FITB
), Nokia Corp. (
NOK
), PNC Financial Services (
PNC
), Travelzoo Inc. (
TZOO
), Amazon.com Inc. (
AMZN
), Capital One Financial Corp. (
COF
), The Cheesecake Factory Inc. (
CAKE
), E*Trade Financial Corp. (
ETFC
), The Mosaic Co. (
MOS
), SanDisk Corp. (
SNDK
), and Xerox Corp. (
XRX
) are scheduled to release their quarterly earnings report today.
Keep your browser at
SchaeffersResearch.com
for more news as it breaks.
Economic Calendar
Weekly initial jobless claims will be joined today by June's
existing home sales and June's leading economic indicators. Friday
ends the week as it began, with no reports slated for release.
Market Statistics
Equity option activity on the Chicago Board Options Exchange (
CBOE
) saw 1,149,301 call contracts traded on Wednesday, compared
to741,497 put contracts. The resultant single-session put/call
ratio arrived at 0.65, while the 21-day moving average held at
0.64.
**The volume data shown above is from the Nasdaq and NYSE
exchanges only. It does not include regional volume activity,
which means that other daily volume quotes you see may be
higher.**
Every morning, our research staff analyzes the prior day and
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Overseas Trading
Overseas trading is in fine shape this morning, as eight of the
10 foreign indexes that we track are in positive territory. The
cumulative average return on the collective stands at a gain of
0.83%. In Asian trading, comments from Fed Chairman Ben Bernanke
spooked traders in Japan, sending stocks down for a fifth straight
session. Meanwhile, regional indexes in China extended their rally
to four in a row on hopes that Beijing won't tighten policies in
the near term. In Europe, stocks received a shot in the arm from a
slew of stronger-than-expected economic reports, including the
French and German purchasing mangers indexes, the euro-zone May
industrial orders (which rose 3.8%), and a 0.7% rise in U.K. June
retail sales.
Currencies and Commodities
A jump in euro-zone industrial orders in May is providing drag
for the U.S. dollar in European trading this morning. With the
greenback down against the euro and the Japanese yen, the U.S.
Dollar Index has plunged nearly 1% to 82.71 and is threatening to
end its winning streak at three sessions. Capitalizing on the
dollar's weakness, crude futures are up 0.73% at $77.12 in
electronic trading, as black gold rebounds from Wednesday's
sell-off. Finally, gold futures down $3.80 at $1,188.00 in
London.
Unusual Put and Call Activity:
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topics on
Option Volume
and
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