Barchart Morning Call
OVERNIGHT MARKETS AND NEWS

Dec E-mini S&Ps (ESZ17 -0.17%) this morning are down -0.16% on weakness in technology stocks, led by a -0.5% decline in Apple in pre-market trading, on a less than enthusiastic response to the company's unveiling of its new iPhone late Tuesday. Geopolitical tensions also rose after U.S. Treasury Secretary Mnuchin warned that the U.S. may impose sanctions on China if it doesn't follow through on the newly imposed United Nations restrictions against North Korea. In its first response to the newly imposed sanctions, North Korea said it will accelerate its plans to acquire a nuclear weapon that can strike the U.S. mainland. European stocks are up +0.12% after Eurozone Jul industrial production rose as expected, and as energy stocks gained with Oct WTI crude oil (CLV17 +0.87%) up +0.91% after the IEA increased its 2017 global crude oil demand estimate by +100,000 bpd to 1.6 million bpd, a 2-year high. Weakness in mining stocks is limiting the advance in European equities with Dec COMEX copper prices (HGZ17 -1.58%) down -1.50% to a 3-week low on signs of ample supplies after LME copper inventories surged +27,850 MT to a 3-week high. Asian stocks settled mixed: Japan +0.45%, Hong Kong -0.28%, China +0.14%, Taiwan -0.73%, Australia -0.04%, Singapore -0.16%, South Korea -0.14%, India +0.09%. Japan's Nikkei Stock Index climbed to a 1-month high on signs of optimism in the Japanese economy after the Japan Q3 BSI large manufacturing business conditions rose +12.3 to 9.4, a 2-year high.

The dollar index (DXY00 -0.08%) is down -0.05%. EUR/USD (^EURUSD) is up +0.14%. USD/JPY (^USDJPY) is down -0.17%.

Dec 10-year T-note prices (ZNZ17 +0.02%) are up +3 ticks.

The UK ILO unemployment rate unexpectedly fell -0.1 to 4.3% for the 3-months through Jul, better than expectations of no change at 4.4% and a 42-year low.

Eurozone Jul industrial production rose +0.1% m/m, right on expectations.

Japan Q3 BSI large manufacturing business conditions rose +12.3 to 9.4, stronger than expectations of +7.9 to 5.0 and a 2-year high.

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) weekly MBA mortgage applications (previous +3.3% with purchase sub-index +1.4% and refi sub-index +5.1%), (2) Aug PPI final demand (expected +0.3% m/m and +2.5% y/y, Jul -0.1% m/m and +1.9% y/y) and Aug PPI ex food & energy (expected +0.1% m/m and +2.1% y/y, Jul -0.1% m/m and +1.8% y/y), (3) Treasury auctions $12 billion of 30-year T-bonds, (4) Aug monthly budget statement expected -$119.0 billion, Jul -$42.9 billion, (5) EIA Weekly Petroleum Status Report.

Notable Russell 1000 earnings reports today include: none.

U.S. IPO's scheduled to price today: Tremont Mortgage Trust (TRMT), Social Capital Hedosophia Holdings (IPOA/U).

Equity conferences this week: Morgan Stanley Global Healthcare Conference on Mon-Wed, Barclays Global Financial Services Conference on Mon-Wed, Bank of America Merrill Lynch Global Real Estate Conference on Tue-Wed, Credit Suisse Basic Materials Conference on Tue-Wed, Deutsche Bank Technology Conference on Tue-Wed, Goldman Sachs Communacopia Conference on Tue-Thu, Bank of America Merrill Lynch European Credit Conference on Wed, KeyBank Capital Markets Basic Materials Conference on Wed, Bank of America Merrill Lynch Global Health Care Conference on Wed-Thu, Morgan Stanley Industrials Conference on Wed-Thu, Morgan Stanley Laguna Conference on Wed-Thu, Royal Bank of Canada Global Industrials Conference on Wed-Thu, BMO Capital Markets Back To School Conference on Thu, C. L. King & Associates Best Ideas Conference on Thu, Pareto Oil & Offshore Conference on Thu.

OVERNIGHT U.S. STOCK MOVERS

Apple (AAPL -0.40%) is down -0.5% in pre-market trading on a less than enthusiastic response to the company's unveiling of its new iPhone late Tuesday.

Rockwell Collins (COL +0.12%) was downgraded to 'Neutral' from 'Outperform' at Baird.

EOG Resources (EOG +0.61%) was upgraded to 'Overweight' from 'Equal Weight' at Morgan Stanley with a price target of $106.

US Foods Holding (USFD +2.03%) was upgraded to 'Overweight' from 'Equal Weight' at Barclays with a price target of $32.

DowDuPont (DWDP +2.50%) was upgraded to 'Outperform' from 'Market Perform' at Cowen with a price target of $80.

Nordstrom (JWN +0.74%) rallied 9% in after-hours trading on a report that private equity firm Leonard Green & Partners may help fund a buyout of Nordstrom,

Centene (CNC +0.38%) jumped nearly 7% in after-hours trading after it purchased Fidelis Care for $3.75 billion, a deal that will allow it to enter New York's health-insurance market.

Accra Therapeutics (AKCA +1.33%) rose 3% in after-hours trading after it filed a new drug submission to Health Canada for volanessorsen, an investigational medicine for the treatment of familial chylomicron syndrome.

Micron (MU +2.54%) was upgraded to 'Buy' from 'Neutral' at Goldman Sachs with a price target of $40.

A-Mark Precious Metals (AMRK +4.38%) tumbled over 10% in after-hours trading after it reported fiscal Q4 revenue fell -24% y/y to $1.33 billion amid "historically low sales levels at the U.S. mint."

Zagg Inc. (ZAGG +4.29%) gained over 1% in after-hours trading after it announced a universal mophie wireless charging base for the iPhone 8, iPhone 8 Plus and the iPhone X.

Inventure Foods (SNAK -1.18%) surged over 25% in after-hours trading after it sold its frozen foods operations for $50 million to Oregon Potato.

MARKET COMMENTS

Dec S&P 500 E-mini stock futures (ESZ17 -0.17%) this morning are down -4.00 points (-0.16%). Tuesday's closes: S&P 500 +0.34%, Dow Jones +0.28%, Nasdaq +0.25%. The S&P 500 on Tuesday climbed to a fresh all-time high and settled higher after U.S. Jul JOLTS job openings unexpectedly rose by +54,000 to 6.17 million, stronger than expectations of -163,000 to 6.00 million and a record high (data from 2000). Stocks rallied further after Treasury Secretary Mnuchin said President Trump will begin pushing for a tax overhaul that will lower tax rates and provide more incentives for multinational corporations based in the U.S. to bring home profits stashed in tax havens overseas.

Dec 10-year T-note prices (ZNZ17 +0.02%) this morning are up +3 ticks. Tuesday's closes: TYZ7 -11.50, FVZ7 -6.50. Dec 10-year T-notes on Tuesday fell to a 2-week low and closed lower on signs of strength in the U.S. labor market that bolsters the case for additional Fed rate hikes after the Jul JOLTS job openings unexpectedly rose to a record high 6.17 million. T-notes also fell back after the S&P 500 rallied to a fresh all-time high and on an increase in inflation expectations after the 10-year T-note breakeven inflation rate rose to a 3-1/2 month high.

The dollar index (DXY00 -0.08%) this morning is down -0.05 (-0.05%). EUR/USD (^EURUSD) is up +0.0017 (+0.14%) and USD/JPY (^USDJPY) is down -0.19 (-0.17%). Tuesday's closes: Dollar Index +0.007 (+0.01%), EUR/USD +0.0014 (+0.12%), USD/JPY +0.78 (+0.71%). The dollar index on Tuesday closed slightly higher after the S&P 500 posted a new record high, which reduced safe-haven demand for the yen and sent USD/JPY to a 1-week high, and on an increase in the 10-year T-note yield to a 2-week high, which improves the dollar's interest rate differentials.

Oct crude oil (CLV17 +0.87%) this morning is up +44 cents (+0.91%) and Oct gasoline (RBV17 +0.72%) is +0.0142 (+0.86%). Tuesday's closes: Oct WTI crude +0.16 (+0.33%), Oct gasoline +0.0218 (+1.33%). Oct crude oil and gasoline on Tuesday closed higher on a report from people familiar with the matter who said that OPEC is considering extending oil-production cuts that expire in Q1 of next year until Q2 of next year. Signs of educed OPEC crude output were also supportive as OPEC Aug oil production fell -140,000 bpd to 32.71 million bpd. Gains in crude were limited on expectations for Wednesday's EIA crude inventories will increase by +4.0 million bbl.

Metals prices this morning are mixed with Dec gold (GCZ17 +0.37%) +5.8 (+0.44%), Dec silver (SIZ17 +0.50%) +0.125 (+0.70%) and Dec copper (HGZ17 -1.58%) -0.046 (-1.50%) at a 3-week low. Tuesday’s closes: Dec gold -3.0 (-0.22%), Dec silver -0.012 (-0.07%), Dec copper -0.0300 (-0.98%). Metals on Tuesday closed lower with Dec gold at a 1-week low and Dec copper at a 2-1/2 week low as the dollar strengthened and after the S&P 500 rallied to a new all-time high, which curbed safe-haven demand for precious metals. Copper prices were also under pressure after LME copper inventories increased by +10,300 MT.

 

GLOBAL EVENT CALENDAR09/13/2017
Wednesday, Sep 13
US 0700 ET Weekly MBA mortgage applications, previous +3.3% with purchase sub-index +1.4% and refi sub-index +5.1%.
0830 ET Aug PPI final demand expected +0.3% m/m and +2.5% y/y, Jul -0.1% m/m and +1.9% y/y. Aug PPI ex food & energy expected +0.1% m/m and +2.1% y/y, Jul -0.1% m/m and +1.8% y/y.
1030 ET EIA Weekly Petroleum Status Report.
1300 ET Treasury auctions $12 billion of 30-year T-bonds.
1400 ET Aug monthly budget statement expected -$119.0 billion, Jul -$42.9 billion.
Thursday, Sep 14
US 0830 ET Weekly initial unemployment claims expected +2,000 to 300,0000, previous +62,000 to 298,000. Weekly continuing claims expected +10,000 to 1.950 million, previous -5,000 to 1.940 million.
0830 ET Aug CPI expected +0.3% m/m and +1.8% y/y, Jul +0.1% m/m and +1.7% y/y. Aug CPI ex food & energy expected +0.2% m/m and +1.6% y/y, Jul +0.1% m/m and +1.7% y/y.
0830 ET USDA weekly Export Sales.
1100 ET Treasury announces amount of 10-year TIPS to be auctioned Sep 21.
U.S. STOCK CALENDAR09/13/2017
NameTickerTimeDescriptionPeriodEstimate
Telephone & Data Systems Inc TDS US Analyst Meeting Q4 17
United States Cellular Corp USM US Analyst Meeting
Digital Realty Trust Inc DLR US Extraordinary General Meeting Q1 18
Equifax Inc EFX US Investor Meeting
Xcel Energy Inc XEL US Roadshow - Day 1
DuPont Fabros Technology Inc DFT US Shareholders Meeting - M&A Vote
Atlassian Corp PLC TEAM US 16:00 Investor Meeting