On Thursday, the Commerce Department released GDP data which
showed that from July to September, the US economy expanded by 3.6
percent. The figure, much higher than the expected 2.8 percent
estimate, was likely fueled by increasing stockpiles.
The data showed that businesses boosted inventories to the
highest levels in 15 years, which will likely translate into softer
GDP in the fourth quarter as inventory growth will likely decline.
Many saw the GDP figure as an incomplete picture of the US'
economic health, saying that softer domestic demand was masked by
the high number.
The European Central Bank elected to maintain its current interest
rate of 0.25 percent at its policy meeting on Thursday. Following
the meeting, bank President Mario Draghi said the ECB was working
to find a way to ensure that its policy changes trickle down to the
households and businesses that need them most. Draghi also
reiterated that the bank was "ready and able to act" if inflation
within the bloc continues to drop. In a statement to parliament, UK
Treasury chief George Osborne said he saw the UK's economy growing
quickly and government borrowing decreasing over the next few
years. Osborne underscored the importance of maintaining its
austerity programs as the UK grows in order to shrink the
government's debts and keep public finances safe. Although China
doesn't plan to revise its newly declared air defense zone, many
think the nation could soften some of its regulations in order to
diffuse tension surrounding the decision. The US has backed down
from its originally disapproving stance under the understanding
that China will not police the area in a way that is dangerous to
pilots or passengers. Standard & Poor's cut its rating for
Qantas Airways to BB+, one level below investment grade, shortly
following the airline's announcement of record losses and 1,000 job
cuts. The carriers stock price plummeted to its lowest level since
July 2012 following the announcement.
Asian markets were mostly lower to end the week, the Shanghai
composite lost 0.44 percent and the South Korean KOSPI was down
0.22 percent. The Japanese NIKKEI and Hong Kong's Hang Seng index
were among the few indexes that gained with the NIKKEI up 0.81
percent and the Hang Seng index up 0.13 percent.
European markets were mostly higher, the UK's FTSE gained 0.32
percent and the eurozone's STOXX 600 was up 0.36 percent. The
German DAX rose 0.54 percent and France's CAC 40 was up 0.36
Energy futures were mixed on Friday, Brent futures were up 0.41
percent and WTI futures lost 0.07 percent. Gold lost 0.31 percent
and silver was down 0.61 percent. Industrial metals were mixed with
aluminum down 0.79 percent and copper up 0.12 percent.
The euro lost 0.06 percent to the dollar but the pound gained
0.12 percent against the greenback. The dollar was up 0.35 percent
against the yen and 0.07 percent against the Australian dollar.
Notable earnings released on Thursday included:
Kroger Company (NYSE:
) reported third quarter EPS of $0.53 on revenue of $22.50 billion,
compared to last year's EPS of $0.46 on revenue of $21.81 billion.
UTI Worldwide Inc. (NASDAQ:
) reported a third quarter loss of $0.09 per share on revenue of
$1.15 billion, compared to last year's EPS of $0.16 on revenue of
$1.13 billion. Dollar General Corporation (NYSE:
) reported third quarter EPS of $0.72 on revenue of $4.38 billion,
compared to last year's EPS of $0.63 on revenue of $3.96 billion.
Stocks moving in the Premarket included:
PPL Corp (NYSE:
) gained 1.26 percent in premarket trade after falling 1.82 percent
on Thursday General Motors Co (NYSE:
) gained 1.05 percent in premarket trade after fising 0.98 percent
on Thursday Dollar General (NYSE:
) gained 0.84 percent in premarket trade after jumping 6.10 percent
on Thursday Gap Inc. (NYSE:
) lost 0.60 percent in premarket trade after falling 1.30 percent
over the past week.
Notable earnings expected on Friday include:
American Eagle Outfitters, Inc. (NYSE:
) is expected to report third quarter EPS of $0.19 on revenue of
$846.75 million, compared to last year's EPS of $0.41 on revenue of
$901.37 million. Big Lots, Inc. (NYSE:
) is expected to report a third quarter loss of $0.08 on revenue of
$1.17 billion, compared to last year's loss of $0.10 on revenue of
$1.13 billion. Bank of Nova Scotia (NYSE:
) is expected to report fourth quarter EPS of $1.31 on revenue of
$5.37 billion, compared to last year's EPS of $1.21 on revenue of
US nonfarm payrolls data will be the star of the show on Friday
as investors look for fresh clues about the heath of the US economy
and the Federal Reserve's taper time line. Other notable releases
include the US unemployment rate, German factory orders and the
French trade balance.
For a recap of Thursday's market action, click .
Tune into Benzinga's pre-market info show with Dennis Dick and
(c) 2013 Benzinga.com. Benzinga does not provide investment
advice. All rights reserved.
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