Updated: 10-23-2014

The Market at 11:30AM ET
Dow: +248.73… | Nasdaq: +74.15… | S&P: +27.53…
NASDAQ Vol: 641.3 mln… Adv: 2125… Dec: 507…
NYSE Vol: 237.1 mln… Adv: 2539… Dec: 452…

Moving the Market

Manufacturing PMI readings from China, Japan, and eurozone surpass estimates

Above-consensus results from 3M, Caterpillar, Celgene, Comcast, General Motors, NXP Semiconductor, and United Continental


Sector Watch
Strong: Consumer Discretionary, Energy, Health Care, Industrials, Technology
Weak: Consumer Staples, Materials, Utilities, Telecom Services

11:30AM ET
[BRIEFING.COM] Equity indices remain near their best levels of the session with small caps in the lead. The Russell 2000 is higher by 2.1% while the S&P 500 trades up 1.4%.

Even though the Russell 2000 trades well ahead of the benchmark index today, it still has a bit of work left before catching up to the S&P 500's gain for the week. Including today's advance, the Russell 2000 is higher by 3.4% since last Friday while the S&P 500 has added 3.6%. However, the Nasdaq has fared even better and currently holds a week-to-date gain of 4.7%.

The tech-heavy Nasdaq has benefitted from the outperformance among biotechnology and chipmaker names. The iShares Nasdaq Biotechnology ETF (IBB 284.06, +7.82) has jumped 2.8% and trades at a new record high after Celgene (CELG 100.18, +5.42) reported upbeat results. As for chipmakers, the PHLX Semiconductor Index (+1.6%) has extended this week's gain to 5.5%.
Dow: +248.73… | Nasdaq: +74.15… | S&P: +27.53…
NASDAQ Adv/Dec 2125/507. …NYSE Adv/Dec 2539/452.

11:00AM ET
[BRIEFING.COM] The major averages have built on their opening gains with the S&P 500 extending its advance to 1.5%. Meanwhile, the Dow Jones Industrial Average (+1.6%) trades ahead of the benchmark index for the first time this week.

The Dow trailed the broader market in each of the first three sessions of the week, but today the index owes its outperformance to earnings-driven gains in 3M (MMM 147.16, +8.21) and Caterpillar (CAT 99.74, +5.17). The two names hold respective gains of 5.9% and 5.5%.

On the flip side, only five Dow components hover in the red with AT&T (T 33.59, -0.91) showing the largest loss. The telecom stock has surrendered 2.6% in reaction to a one-cent miss, but has had little impact on the Dow due to its low share price. AT&T is the fifth smallest Dow component by weight.

Elsewhere, Treasuries have continued their retreat with the 10-yr yield climbing to 2.27% (+5 bps).
Dow: +256.27… | Nasdaq: +73.67… | S&P: +28.10…
NASDAQ Adv/Dec 2099/482. …NYSE Adv/Dec 2511/433.

10:35AM ET
[BRIEFING.COM]
  • Oil prices were volatile this morning after news about Saudi Arabia came out, which caused nat gas to rally as high as $81.879/barrel by around 8am EST,
  • It appears that the initial news was viewed as if Saudi Arabia had cut production.
  • This was not the case, which was revealed as other news sources came out with more color.
  • The actual news is, Saudi Arabia supplied 328K less barrels of oil to international and domestic markets in September, while production actually rose about 100K barrels to around 9.7 mln million barrels of crude production.
  • To put things into more perspective, the world produced 90.1 million barrels of crude oil per day in 2013 (Saudi Arabia produced 11.6 million barrels, or 13% of global production).
  • Natural gas futures have been sliding lower this morning and were near its session low ahead of the weekly EIA storage data.
  • However, following the storage data, nat gas spiked to new session highs as the build came in lower than expected.
  • Nov natural gas is currently -0.1% at $3.66/MMBtu, while Dec crude oil is +1.4% at $81.64/barrel
  • Gold has been weak all day so far and just hit a new session. Silver is in the red as well today
  • Dec gold is now -1.4% at $1227.70/oz, Dec silver -0.6% at $17.14/oz
  • Dec copper is +0.8% at $3.04/lb
Dow: +227.07… | Nasdaq: +66.38… | S&P: +24.44…
NASDAQ Adv/Dec 1983/556. …NYSE Adv/Dec 2443/455.

10:05AM ET
[BRIEFING.COM] The S&P 500 remains higher by 1.0% with seven sectors in the green. Utilities (-0.1%) and materials (-0.1%) have surrendered their slim opening gains and now trade in the red alongside the telecom services sector (-1.6%).

Just released, the Leading Indicators report for September was up 0.8%, while the Briefing.com consensus expected a reading of 0.5%. That followed a revised flat reading in August (from 0.2%).
Dow: +204.27… | Nasdaq: +51.37… | S&P: +19.79…
NASDAQ Adv/Dec 1842/519. …NYSE Adv/Dec 2387/457.

09:40AM ET
[BRIEFING.COM] As expected, the major averages spiked out of the gate amid broad strength. The S&P 500 trades higher by 1.0% with nine sectors showing opening gains.

The industrial sector (+1.9%) has claimed the early lead with help from 3M (MMM 144.78, +5.83) and Caterpillar (CAT 98.21, +3.53), both of which reported better than expected quarterly results. Furthermore, the Dow Jones Transportation Average is higher by 1.9% following above-consensus earnings from Southwest Airlines (LUV 34.99, +0.79). United Continental (UAL 47.22, -1.84) also surpassed estimates, but its stock trades lower by 3.8%.  

On the downside, the telecom services sector is lower by 1.0% after AT&T (T 33.78, -0.72) reported a one-cent miss.

Treasuries have slipped to fresh lows with the 10-yr yield up four basis points at 2.26%.

The Leading Indicators report for September (consensus 0.5%) will be released at 10:00 ET.
Dow: +199.98… | Nasdaq: +42.28… | S&P: +19.20…
NASDAQ Adv/Dec 1775/428. …NYSE Adv/Dec 2415/352.

09:12AM ET
[BRIEFING.COM] S&P futures vs fair value: +18.40. Nasdaq futures vs fair value: +39.20. The stock market is on track for a sharply higher start with futures on the S&P 500 trading 18 points above fair value. Index futures spiked off their overnight lows at the start of the European session with a second push higher taking place after several U.S. companies reported better than expected quarterly results.

To that point, 3M (MMM 142.13, +3.18), Caterpillar (CAT 98.40, +3.83), Celgene (CELG 95.98, +1.22), Comcast (CMCSA 52.50, +1.01), General Motors (GM 32.11, +0.80), NXP Semiconductor (NXPI 65.90, +1.77), PulteGroup (PHM 19.34, +0.16), and United Continental (UAL 47.42, -1.64) surpassed bottom-line estimates.

On the economic front, the latest weekly Initial Claims report showed an increase to 283,000 from 264,000, but that was still better than the Briefing.com consensus, which expected a reading of 285,000.

Separately, the August Housing Price Index from the FHFA rose 0.5% (prior revised to 0.2% from 0.1%), while the Leading Indicators report for September (consensus 0.5%) will be released at 10:00 ET.

Treasuries are on their lows with the benchmark 10-yr yield up almost four basis points at 2.26%.

09:02AM ET
[BRIEFING.COM] S&P futures vs fair value: +18.90. Nasdaq futures vs fair value: +40.50. The August Housing Price Index from the FHFA rose 0.5%, which followed a revised increase of 0.2% (from 0.1%) observed during the prior month.

08:59AM ET
[BRIEFING.COM] S&P futures vs fair value: +19.60. Nasdaq futures vs fair value: +42.20. The S&P 500 futures trade 20 points above fair value.

Markets fell across Asia. China's HSBC Manufacturing PMI came in ahead of estimates, but the output index fell to 50.7 from 51.3 and the employment component declined as well.
  • In economic data: 
    • China's HSBC Manufacturing PMI ticked up to 50.4 from 50.2 (expected 50.3) 
    • Japan's Manufacturing PMI rose to 52.8 from 51.7 (consensus 52.1) 
    • Australia's NAB Quarterly Business Confidence held at 6 
    • New Zealand's CPI rose 0.3% quarter-over-quarter (expected 0.5%; previous 0.3%) while the year-over-year reading increased 1.0% (consensus 1.3%; prior 1.6%) 
    • Singapore's CPI eased to 0.6% year-over-year from 0.9% (expected 1.0%) 
------
  • Japan's Nikkei shed 0.4%, but held the 200-day average. Heavyweights Fast Retailing and Softbank were a drag as both lost 0.7%. 
  • Hong Kong's Hang Seng slipped 0.3%, but also managed to hold its 200-day moving average. Telecom stocks were hit hard as China Unicom Hong Kong and China Mobile gave up 3.5% and 3.2%, respectively. 
  • China's Shanghai Composite fell 1.0% to a one-month low as an upcoming wave of IPOs led to profit taking. Rail stocks outperformed with CSR climbing 3.7% and China CNR surging 5.3%. 
  • India's Sensex was closed in observance of Diwali. 
Major European indices trade in mixed fashion with France's CAC (+0.5%) in the lead. The European Commission is expected to request France to add EUR6 billion in spending cuts to its 2015 budget. On a related note, the Commission is reportedly seeking additional details regarding Italy's 2015 budget.
  • Economic data was plentiful: 
    • Eurozone Manufacturing PMI rose to 50.7 from 50.3 (expected 49.9) while Services PMI held at 52.4 (expected 52.0) 
    • Germany's Manufacturing PMI rose to 51.8 from 49.9 (consensus 49.5) while Services PMI fell to 54.8 from 55.7 (expected 55.0) 
    • Great Britain's Retail Sales fell 0.3% month-over-month (expected -0.1%; previous 0.4%) while the year-over-year reading increased 2.7% (consensus 2.8%; prior 3.7%). Core Retail Sales slipped 0.3% month-over-month (expected -0.2%; previous 0.3%) while the year-over-year reading increased 3.1% (consensus 3.4%; last 4.4%). Separately, BBA Mortgage Approvals came in at 39,300 (expected 41,500; last 41,400) and CBI Industrial Trends Orders fell to -6 from -4 (expected -4) 
    • French Manufacturing PMI fell to 47.3 from 48.8 (expected 48.5) while Services PMI slipped to 48.1 from 48.4 (consensus 48.2) 
    • Spain's Unemployment Rate fell to 23.7% from 24.5% (expected 24.3%) 
------
  • France's CAC is higher by 0.8% with defense contractor Safran in the lead. The stock trades higher by 4.7%. Financials also display strength with AXA and Societe Generale up 0.9% and 1.2%, respectively. 
  • Germany's DAX has added 0.5% amid strength in growth-sensitive names. ThyssenKrupp leads with an increase of 3.3% while financials Allianz, Munich Re, and Commerzbank are up between 1.3% and 2.1%. Lanxess is the lone decliner, down 0.9%. 
  • Great Britain's FTSE is lower by 0.1% with consumer names showing losses. Tesco, WM Morrison Supermarkets, and Unilever are down between 2.8% and 5.7%. Barclays outperforms with a gain of 1.2%.

08:31AM ET
[BRIEFING.COM] S&P futures vs fair value: +18.60. Nasdaq futures vs fair value: +36.70. The S&P 500 futures trade 19 points above fair value.

The latest weekly initial jobless claims count totaled 283,000, while the Briefing.com consensus expected a reading of 285,000. Today's tally was above the revised prior week count of 266,000 (from 264,000). As for continuing claims, they rose to 2.351 million from 2.389 million.

07:59AM ET
[BRIEFING.COM] S&P futures vs fair value: +16.60. Nasdaq futures vs fair value: +35.50. U.S. equity futures trade higher despite cautious action overseas. The S&P 500 futures hover almost 17 points above fair value after spiking off their lows at the start of the European session. Economic data received since yesterday's close has been a supportive factor with headline Manufacturing PMI readings from China, Japan, and the eurozone coming in ahead of expectations.

Treasuries hold modest losses with the 10-yr yield up two basis points at 2.24%.

Weekly Initial Claims will be released at 8:30 ET (Briefing.com consensus 285K) while the FHFA Housing Price Index for August will cross the wires at 9:00 ET. The day's data will be topped off with the Leading Indicators report for September (consensus 0.5%), which will be released at 10:00 ET.

In U.S. corporate news of note:
  • 3M (MMM 140.90, +1.95): +1.4% after beating earnings estimates on below-consensus revenue. Also of note, the company narrowed its full-year 2014 guidance. 
  • AT&T (T 34.00, -0.50): -1.5% after reporting a one-cent miss. 
  • Caterpillar (CAT 99.50, +4.93): +5.2% following better than expected earnings/revenue, and guidance. 
  • Celgene (CELG 93.34, -1.42): -1.5% after beating estimates and guiding higher 
  • Comcast (CMCSA 52.00, +0.51): +1.0% after beating earnings estimates. 
  • Credit Suisse (CS 26.34, +0.33): +1.3% in reaction to better than expected results. 
  • General Motors (GM 32.14, +0.83): +2.7% after beating on both metrics. 
  • NXP Semiconductor (NXPI 66.20, +2.07): +3.2% after beating earnings and revenue estimates. 
  • Logitech (LOGI 13.58, +0.78): +6.1% in reaction to a bottom-line beat. 
  • Under Armour (UA 62.95, -3.10): -4.7% despite reporting a one-cent beat and boosting its guidance. 
  • United Continental (UAL 48.18, -0.88): -1.8% despite beating earnings estimates. 
Reviewing overnight developments:
  • Asian markets ended lower. Hong Kong's Hang Seng -0.3%, Japan's Nikkei -0.4%, and China's Shanghai Composite -1.0% 
    • In economic data: 
      • China's HSBC Manufacturing PMI ticked up to 50.4 from 50.2 (expected 50.3) 
      • Japan's Manufacturing PMI rose to 52.8 from 51.7 (consensus 52.1) 
      • Australia's NAB Quarterly Business Confidence held at 6 
      • New Zealand's CPI rose 0.3% quarter-over-quarter (expected 0.5%; previous 0.3%) while the year-over-year reading increased 1.0% (consensus 1.3%; prior 1.6%) 
      • Singapore's CPI eased to 0.6% year-over-year from 0.9% (expected 1.0%) 
    • In news: 
      • China's HSBC Manufacturing PMI came in ahead of estimates, but the output index fell to 50.7 from 51.3 and the employment component declined as well.
  • Major European indices trade in mixed fashion. Germany's DAX +0.1%, France's CAC +0.2%, and Great Britain's FTSE -0.4%. Elsewhere, Spain's IBEX -0.3% and Italy's MIB -0.4% 
    • Economic data was plentiful: 
      • Eurozone Manufacturing PMI rose to 50.7 from 50.3 (expected 49.9) while Services PMI held at 52.4 (expected 52.0) 
      • Germany's Manufacturing PMI rose to 51.8 from 49.9 (consensus 49.5) while Services PMI fell to 54.8 from 55.7 (expected 55.0) 
      • Great Britain's Retail Sales fell 0.3% month-over-month (expected -0.1%; previous 0.4%) while the year-over-year reading increased 2.7% (consensus 2.8%; prior 3.7%). Core Retail Sales slipped 0.3% month-over-month (expected -0.2%; previous 0.3%) while the year-over-year reading increased 3.1% (consensus 3.4%; last 4.4%). Separately, BBA Mortgage Approvals came in at 39,300 (expected 41,500; last 41,400) and CBI Industrial Trends Orders fell to -6 from -4 (expected -4) 
      • French Manufacturing PMI fell to 47.3 from 48.8 (expected 48.5) while Services PMI slipped to 48.1 from 48.4 (consensus 48.2) 
      • Spain's Unemployment Rate fell to 23.7% from 24.5% (expected 24.3%) 
    • Among news of note: 
      • The European Commission is expected to request France to add EUR6 billion in spending cuts to its 2015 budget. On a related note, the Commission is reportedly seeking additional details regarding Italy's 2015 budget.

06:47AM ET
[BRIEFING.COM] S&P futures vs fair value: +11.50. Nasdaq futures vs fair value: +24.00.

06:47AM ET
[BRIEFING.COM] Nikkei...15,138.96...-56.80...-0.40%.  Hang Seng...23,333.18...-70.80...-0.30%.

06:47AM ET
[BRIEFING.COM] FTSE...6,362.95...-36.80...-0.20%.  DAX...8,959.10...+19.20...+0.20%.

04:15PM ET
[BRIEFING.COM] The stock market ended the midweek session on a lower note, causing the S&P 500 (-0.7%) to snap its four-day winning streak. The benchmark index slumped into the red during afternoon action while the Dow Jones Industrial Average (-0.9%) underperformed once again.

Equity indices displayed modest gains in the early going, but that advance took place despite the lack of concerted leadership. The underperformance of several influential sectors weighed on the market and led to a mid-session retreat.

Five of six cyclical sectors ended behind the broader market with energy (-1.7%) showing the largest decline. The growth-sensitive sector displayed intraday strength, but slumped in the afternoon amid weakness in crude oil. The energy component spent the morning near its flat line, but plunged in the afternoon to end lower by 2.4% at $80.49/bbl. Greenback strength acted as a bit of a headwind with the Dollar Index (85.75, +0.45) rising 0.5%.

Ending just ahead of energy was the industrial sector (-1.3%), which was pressured by Boeing (BA 121.45, -5.67). The Dow component reported better than expected results, but fell 4.5% amid concerns about increasing production costs for its Dreamliner jet.

Transport stocks also weighed on the sector with the Dow Jones Transportation Average falling 2.1%. The bellwether complex narrowed this week's gain to 2.0% after Ryder (R 81.17, -5.89) and Norfolk Southern (NSC 106.50, -3.35) reported earnings. Ryder missed top-line estimates while Norfolk Southern reported disappointing earnings and revenue.

Elsewhere, the technology sector (-0.6%) was the lone outperformer among cyclical groups. Broadcom (BRCM 39.37, +2.04) surged 5.5% in reaction to better than expected results while most large cap components ended in the red. Apple (AAPL 102.99, +0.52) and Google (GOOGL 542.69, +4.66) bucked the trend, climbing 0.5% and 0.9%, respectively. Chipmakers finished among the laggards with the PHLX Semiconductor Index falling 1.4%.

The underperformance of microchip names pressured the Nasdaq (-0.8%), which also faced weakness in the biotech space. Biogen Idec (BIIB 309.07, -17.70) sank 5.4% after investors overlooked better than expected earnings, instead focusing on slowing sales of the company's main drug. The iShares Nasdaq Biotechnology ETF (IBB 276.24, -2.03) lost 0.7% while the health care sector shed 0.6%.

On the upside, countercyclical consumer staples (+0.1%) and utilities (+0.6%) displayed relative strength throughout the session. The utilities sector extended its October gain to 4.6%.

Treasuries ended flat after reclaiming their intraday losses. The 10-yr yield finished at 2.22%.

Participation was above average with more than 779 million shares changing hands at the NYSE floor.

Economic data was limited to the MBA Mortgage Index and CPI:
  • The weekly MBA Mortgage Index spiked 11.6% to follow last week's increase of 5.6% 
  • CPI and core CPI both ticked up 0.1% (CPI Briefing.com consensus 0.0%; Core CPI consensus +0.2%) 
    • Energy prices declined 0.7%, representing the third monthly decrease 
    • Food prices, meanwhile, increased 0.3% after rising 0.2% in August with beef and veal prices rising 2.0% to bring their 2014 increase to 16.7% 
Tomorrow, weekly Initial Claims will be released at 8:30 ET (Briefing.com consensus 285K) while the FHFA Housing Price Index for August will cross the wires at 9:00 ET. The day's data will be topped off with the Leading Indicators report for September (consensus 0.5%), which will be released at 10:00 ET.
  • Nasdaq Composite +4.9% YTD 
  • S&P 500 +4.3% YTD 
  • Dow Jones Industrial Average -0.7% YTD 
  • Russell 2000 -5.7% YTD
Dow: -153.49… | Nasdaq: -36.63… | S&P: -14.17…
NASDAQ Adv/Dec 732/2040. …NYSE Adv/Dec 946/2144.

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