The Bank of Japan released its semiannual outlook report on
Thursday in which the bank predicted that core consumer prices will
rise by 1.9 percent in the fiscal year starting April 2015.
The estimate was unchanged from July's expectations, but many
private-sector economists are disputing the forecast. Many believe
that the years of deflation Japan has suffered will keep the
inflation rate at 1 percent and that the bank will need to make
more policy changes in order to combat it.
In other news around the markets:
As expected, the US Federal Reserve maintained its easy money
program and did not provide any concrete details about when the
bank would begin to taper. Most see the Fed's taper hinging on
congressional budget negotiations which have a December 13th
deadline to agree on a budget for government spending in 2014.
Although Facebook released impressive earnings on Wednesday,
warnings about the future from the company's executives
overshadowed its 60 percent revenue growth. Most worrisome was that
Facebook will likely be unable to include more ads on users'
newsfeeds. Instead, the company will focus on improving the quality
of the ads to increase prices. Inflation figures from the eurozone
added to growing pressure on the ECB to make a move in order to
keep inflation from slipping to dangerously low levels. Germany's
annual inflation was down to 1.3 in October from 1.6 in September,
and consumer prices slipped 0.2 percent in Spain. Retailers and
grocers could be hit hard when $16 billion worth of food stamps are
taken from the market. Retailers that rely on low-income shoppers
like gas stations, dollar stores and discounters will likely feel
the strain. Retailers like Wal-Mart Stores Inc and Target Corp have
already lowered their sales forecasts for the remainder of the year
despite the upcoming holidays.
Asian markets fell on Thursday, the Japanese NIKKEI was down
1.20 percent, the Shanghai composite lost 0.87 percent and the
Shenzhen composite fell 1.18 percent. The South Korean KOSPI had
the largest losses, down 1.43 percent.
Europe's markets also slipped as worrisome inflation data
weighed on sentiment. The UK's FTSE fell 0.36 percent and the
eurozone's STOXX 600 lost 0.11 percent. The German DAX was down
0.24 percent and France's CAC 40 lost 0.20 percent.
Energy futures were lower, Brent futures lost 0.42 percent and
WTI futures were down 0.14 percent. Precious metals also tumbled
with gold down 1.12 percent and silver down 2.88 percent.
Industrial metals were mostly higher with Aluminum up 0.52 percent
but copper down 0.63 percent.
The dollar got a boost from the possibility that the Fed could
taper sooner rather than later. The euro lost 0.25 percent against
the dollar and the pound was down 0.09 percent against the American
currency. The yen was up 0.23 percent against the dollar and the
Australian dollar gained 0.31 percent against the greenback.
Notable earnings released on Wednesday included:
Facebook, Inc. (NASDAQ:
) reported third quarter EPS of $0.25 on revenue of $2.02 billion,
compared to last year's EPS of $0.12 per share on revenue of $1.26
billion. Comcast Corporation (NASDAQ:
) reported EPS of $0.65 on revenue of $16.15 billion, compared to
last year's EPS of $0.46 on revenue of $16.54 billion. Visa Inc.
) reported third quarter EPS of $1.85 on revenue of $2.97 billion,
compared to last year's EPS of $1.54 on revenue of $2.73 billion.
Marriott International (NYSE:
) reported third quarter EPS of $0.52 on revenue of $3.20 billion,
compared to last year's EPS of $0.44 on revenue of $2.73 billion.
Stocks moving in the Premarket included:
Facebook, Inc. (NASDAQ:
) gained 1.14 percent in premarket trade after releasing strong
earnings data on Wednesday PowerShares QQQ Trust, Series 1 (NASDAQ:
) gained 0.35 percent in premarket trade on the possibility of a
Fed taper sooner than expected. ARIAD Pharmaceuticals, Inc.
) gained 7.65 percent in premarket trade after Sarissa Capital
Management LP took a 6.22 percent stake in the company.
Earnings reports expected on Thursday include:
) is expected to report third quarter EPS of $1.39 on revenue of
$12.97 billion, compared to last year's EPS of $1.44 per share on
revenue of $15.09 billion. Mastercard Incorporated (NYSE:
) is expected to report EPS of $6.92 on revenue of $2.13 billion,
compared to last year's EPS of $6.17 on revenue of $1.92 billion.
Allstate Corporation (NYSE:
) is expected to report third quarter EPS of $1.06 on revenue of
$7.30 billion, compared to last year's EPS of $1.46 on revenue of
$7.06 billion. American International Group, Inc. (NYSE:
) is expected to report third quarter EPS of $0.86 on revenue of
$8.63 billion, compared to last year's EPS of $1.00 on revenue of
Thursday's economic calendar is a busy one with several US and
European releases including US initial and continuing jobless
claims, Italian CPI and PPI, the eurozone unemployment rate, French
consumer spending and the Spanish current account.
For a recap of Wednesday'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.
Free Trading Education -
Check out the free events taking place on Marketfy
this week. Spaces are limited. Sign up today.