On Thursday, Russian President Vladimir Putin warned Europe that
its gas supplies could be disrupted if Russia cuts off Ukraine's
supply due to unpaid bills. Putin wrote a letter to eurozone
leaders, stating his frustration with Kiev's $2.2 billion dollar
debt, saying that supplies would be cut off if the problem is not
The letter drew US accusations that the Kremlin is using energy
"as a tool of coercion". Since Ukraine ousted President
Viktor Yanukovich, Russia has almost doubled the cost of gas for
Ukraine despite the nation's economic crisis. An interruption to
the gas flow in Ukraine would have a domino effect across Europe,
as most European nations receive natural gas via a pipeline which
passes through Ukraine.
In other news around the markets:
On Thursday, the White House announced that Health and Human
Services Secretary Kathleen Sebelius has decided to resign.
Sebelius oversaw the rollout of Obama's Affordable Care Act, which
many have criticized for its many flaws. Many hope that her
resignation will help calm the waters ahead of US midterm elections
in November, in which Democrats are hoping to maintain control of
the US Senate. The National Bureau of Statistics announced on
Friday that China's consumer price index increased 2.4 percent in
March, with fresh food prices providing the bulk of the lift.
However, producer prices fell 2.3 percent, the 25th consecutive
month of decline. Greece made its way back into the good graces of
financial markets as it sold more than $4 billion worth of bonds on
Thursday. Though the sale raised less than one percent of the total
needed to pay off Greek debt, it marked the nation's return to
stability after years of painful budget cuts. General Motors
received more bad news on Thursday after estimates for the cost of
the company's recall were raised to $1.3 billion. The new estimate
is more than three times what GM originally estimated and out paces
the company's first quarter profit in 2014. Additionaly, the
ongoing investigation has forced the company to fire two engineers
who were involved in the decision making related to the
faulty ignition switches.
Asian markets were down across the board after being spooked by
Wall Street's losses on Thursday. The NIKKEI was down 2.38 percent,
the Shanghai composite lost 0.18 percent, the Shenzhen composite
fell 0.20 percent and the Hang Seng index lost 0.79 percent.
European markets were down across the board; the UK's FTSE lost
0.99 percent, the eurozone's STOXX 600 was down 1.11 percent, the
German DAX fell 1.21 percent, France's CAC 40 lost 1.02 percent and
the Spanish IBEX was down 0.86 percent.
Energy futures lost ground; Brent futures were down 0.34 percent
to $107.09 per barrel and WTI futures lost 0.25 percent. Gold
and silver lost 0.26 percent and 0.70 percent respectively while
industrial metals increased. Copper gained 0.56 percent, aluminum
was up 1.86 percent and zinc rose 0.89 percent.
The dollar regained some momentum on Friday and gained 0.25
percent against the yen, 0.25 percent against the Australian dollar
and 0.11 percent against the pound. The euro also gained; up 0.11
percent against the pound and 0.22 percent against the yen.
Notable earnings released on Thursday included:
Rite Aid Corporation (NYSE:
) reported fourth quarter EPS of $0.10 on revenue of $6.60 billion,
compared to last year's EPS of $0.13 on revenue of $6.46 billion.
Family Dollar Stores, Inc. (NYSE:
) reported second quarter EPS of $0.80 on revenue of $2.72 billion,
compared to last year's EPS of $1.21 on revenue of $2.89 billion.
Shaw Communications Inc. (NYSE:
) reported second quarter EPS of $0.46 on revenue of $1.27 billion,
compared to last year's EPS of $0.38 on revenue of $1.25 billion.
Stocks moving in the Premarket included:
Ford Motor Co (NYSE:
) gained 1.41 percent in premarket trade after steadily declining
4.64 percent over the past week. Alcoa Inc. (NYSE:
) was up 0.63 percent in premarket trade after losing 2.31 percent
on Thursday. Carnival Corp (NYSE:
) rose 0.53 percent in premarket trade after declining 1.73 percent
on Thursday. Corning Inc. (NYSE:
) was down 1.01 percent in premarket trade after losing 3.80
percent over the past week.
Notable earnings releases expected on Friday include:
Wells Fargo & Company (NYSE:
) is expected to report first quarter EPS of $0.96 on revenue of
$20.65 billion, compared to last year's EPS of $0.92 on revenue of
$21.26 billion. JP Morgan Chase & Co (NYSE:
) is expected to report first quarter EPS of $1.43 on revenue of
$24.67 billion, compared to last year's EPS of $1.59 on revenue of
$24.85 billion. Fastenal Company (NASDAQ:
) is expected to report first quarter EPS of $0.38 on revenue of
$870.87 million, compared to last year's EPS of $0.37 on revenue of
Friday's economic calendar will be thin with releases including
US PPI, US CPI, Spanish CPI, German CPI and the French current
For a recap of Thursday's market action, click .
Tune into Benzinga's pre-market info show with Dennis Dick and
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