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TradeTheNews.com US Market Update: Equities Bounce Higher After Monday's Slide
US Market Update: Equities Bounce Higher After Monday's Slide
Tue, 04 Feb 2014 11:23 AM EST
- Asia equities tanked following slide in US stocks: Nikkei fell 4.2% and Hong
Kong's Hang Seng fell 2.9%.
- The global equity slide appeared to bottom out midway through the European
- ECB fully sterilized bond purchases
for the first time in three weeks.
- (BR) Brazil Dec Industrial Production M/M: -4.5% v -1.7%e; Y/Y: -2.3% v
- (EU) OECD Dec Annual Inflation: 1.6% v 1.5% prior
- (RO) Romania Central Bank (NBR) cuts Interest Rate by25bps to 3.50% (record
low), as expected
- (IE) Ireland Jan Consumer Confidence: 84.6 v 79.8 prior
- (US) ICSC Chain Store Sales w/e Feb 1st: w/w +0.3%; y/y: 0.0%
- (US) Redbook Retail Sales w/e Feb 1st
: +2.7% y/y, Jan MTD: -0.2% m/m; Jan MTD Y/Y: +3.0%
- (EU) Weekly ECB Forex Reserves: €207.2B v €207.3B prior
- (US) Jan ISM New York: 64.4 v 63.8 prior
- (US) Dec Factory Orders: -1.5% v
- (US) Feb IBD/TIPP Economic Optimism: 44.9 v 44.5e
- (MX) Mexico Dec Total Remittances: $1.80B v $1.8Be
- (DK) Denmark Jan Foreign Reserves (DKK): 475.7B v 482.9Be
- The S&P500 sank 2.3% during Monday's session, its biggest decline since
last summer. Today US equities are
bouncing higher with enthusiasm, trading volumes are running nearly 20% above
average. As of writing, the DJIA is up 0.45%, the S&P500 is up 0.44%
and the Nasdaq is up 0.68%.
- Trading in EUR/USD has been very choppy as the pair meets very strong
downside resistance around 1.3500. The
big FX story is AUD, which has seen strong gains in the wake of a far less
dovish RBA policy statement (the RBA left rates on hold). AUD/USD is up over
150pips above $0.8900 while AUD/JPY has reversed risk-off flows to retake the
- The US debt ceiling issue is very much in play in Washington, DC this week.
Treasury Secretary Lew said that the Obama Administration would exhaust
extraordinary measures by end of February if Congress does not raise the limit.
Last night, the Washington Post wrote
that the House Republicans were reviewing their options for negotiating over
the debt ceiling. One was a one-year extension in exchange for the
approval of the Keystone XL pipeline, while another was a one-year increase in
return for the repeal of certain aspects of the Affordable Care Act. Boehner
said that the GOP would be looking for more deficit reduction measures.
- Copper futures have plummeted since the beginning of 2014: the March contract
dropped from $3.40/lb to just above $3.18/lb as of yesterday, marking the
metal's longest sustained decline in approximately 18 years. Copper is poised
to move higher today, bouncing a little higher with the rally this morning.
- Luxury handbag maker Michael Kors is
among the biggest gainers this morning. Shares of KORS is up 18.6% this morning
after the firm blew out earnings and revenue targets and hiked its FY14 view by
a large margin. Sales comps were very good. The firm's quarterly profit
was up 77% y/y while revenue grew nearly 60% y/y.
- Shares of YUM Brands are up 9.2% this
morning after the firm beat earning expectations and reaffirmed its full-year
outlook. Revenue missed expectations and sales comps in both the US and
China were both negative. With the shares at three-month lows ahead of the
quarterly report, traders are fixing on any good news as an excuse to buy.
- JC Penny rose about 3% in the premarket after disclosing that the firm saw
positive same-store sales in its fourth quarter, its first positive quarterly
comp gain since 2011. Recall that the firm's Q3 SSS were -4.8%, while the
year-ago Q4 figure was a dismal -31.7%. The firm's holiday sales comp (Nov and
Dec combined) was +3.1%. Analysts and
investors are not impressed, and shares of JCP have given up all the gains to
trade -4.3% as of writing.
- Investors are looking past Take Two's very good performance in its third
quarter and obsessing about its weak Q4 guidance. The firm more than doubled
its profits in Q3 and revenue was up 40% y/y, and it also raised its FY14
guidance. However its Q4 outlook widely missed expectations. TTWO is down 11%.
- Microsoft has named Satya Nadella as
its new CEO, although the announcement comes after widespread leaks in the
press. Redmond also said that Bill Gates will step down as chairman to
become a technology advisor. When Steve Ballmer stepped down there were widespread
reports that Microsoft needed a fresh face from outside the firm to shake
things up, but Nadella has been with the company for 22 years, most recently
heading up the cloud computing division.
- 11:30 (US) Treasury to sell $30B in 4-Week Bills
- 12:30 (US) Fed's Evans speaks on
Monetary Policy in Detroit
- 13:00 (MX) Mexico Jan IMEF Manufacturing Index: 50.9e v 50.3 prior;
Non-Manufacturing Index: 52.1e v 53.2 prior
- 13:00 (MX) Mexico Jan IMEF Manufacturing Index Unadj: No est v 49.8 prior;
Non-Manufacturing Index Unadj: No est v 54.7 prior
- 16:00 (CO) Colombia Jan PPI M/M: No est v 0.1% prior; Y/Y: No est v -0.5%
- 16:30 (US) Weekly API Crude Oil Inventories
- 16:45 (NZ) New Zealand Q4 Unemployment Rate: 6.0%e v 6.2% prior
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