OVERNIGHT MARKETS AND NEWS

December E-mini S&Ps (ESZ15 +0.11%) are up +0.16% ahead of the minutes of the Oct 27-28 FOMC meeting that may provide a clue as to the timing of a Fed interest rate increase. Increase M&A activity is giving U.S. stocks a lift with Fairchild Semiconductor International up nearly 7% in pre-market trading after ON Semiconductor Corp. agreed to buy the company for about $2.4 billion. European stocks are down -0.78% as a slide in metals prices has undercut mining stocks and raw material producers with the price of gold (GCZ15 +0.07%) falling to its lowest in 5-3/4 years. Asian stocks settled mixed: Japan +0.09%, Hong Kong -0.34%, China -1.01%, Taiwan -0.94%, Australia +0.29%, Singapore -1.05%, South Korea +0.07%, India -1.48%. China's Shanghai Composite closed lower after data showed China's home-price recovery slowed in Oct with new home price increases in 27 cities tracked by the government, fewer than 39 cities that rose in Sep. Japan's Nikkei Stock Index rallied up to a 2-3/4 month high as the yen remained just above the recent 2-3/4 month low, which improves the earnings prospects of Japanese exporters.

The dollar index (DXY00 -0.11%) is down -0.12%. EUR/USD (^EURUSD) is up +0.27% and recovered slightly from a 7-month low after ECB Executive Board member Mersch downplayed any negative economic aspects of the Paris terrorist attacks. USD/JPY (^USDJPY) is down -0.05%.

Dec T-note prices (ZNZ15 -0.06%) are down -1.5 ticks.

ECB Executive Board member Mersch said that "we have no indication of any economic pessimism as a result of the Paris attacks, let alone weaker hard data."

China Oct new home prices rose in 27 out of 70 cities tracked by the government m/m, less than 39 cities that rose in Sep. New home prices rose y/y n 16 of 70 cities in Oct compared with 12 cities that rose y/y in Sep.

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) weekly MBA mortgage applications (previous -1.3% with purchase sub-index +0.1% and refi sub-index -2.2%), (2) an appearance by New York Fed President William Dudley, Atlanta Fed President Dennis Lockhart and Cleveland Fed President Loretta Mester on a panel about payment systems at the Clearing House Annual Conference in New York, (3) Oct housing starts (expected -3.8% to 1.160 million, Sep +6.5% to 1.206 million), (4) Dallas Fed President Rob Kaplan's speech at the University of Houston on ďA Discussion of Economic Conditions and Federal Reserve Policy, and (5) minutes from the Oct 27-28 FOMC meeting.

There are 7 of the S&P 500 companies that report earnings today: Target (consensus $0.86), Lowe's (0.78), Staples (0.35), L Brands (0.53), Keurig Green Mountain (0.71), NetApp (0.57), Salesforce.com (0.19).

U.S. IPO's scheduled to price today: Square (SQ), Match Group (MTCH), Mimecast (MIME), Congatec Holding (CONG).

Equity conferences this week include: Bank of America Merrill Lynch Banking and Financial Services Conference on Tue-Wed, Morgan Stanley Global Consumer & Retail Conference on Tue-Wed, Stifel Health Care Conference on Tue-Wed, Bank of America Merrill Lynch Frontier Markets Conference on Wed, Barclays Global Automotive Conference on Wed, Vertical Research Partners Global Materials Conference on Wed, Canaccord Genuity Medical Technology and Diagnostics Forum on Thu, Jefferies Global Health Care Conference on Thu, Scotiabank Canadian Energy Infrastructure Conference on Thu, UBS Industrials and Transportation Conference on Thu-Fri.

 

 

 

 

 

 

 

 

OVERNIGHT U.S. STOCK MOVERS

Apple (AAPL -0.43%) was added to the 'Conviction Buy' list at Goldman Sachs.

Staples (SPLS -2.05%) slid 3% in pre-market trading after it lowered guidance on Q4 EPS to 26 cents-30 cents, below consensus of 29 censts, and said it sees Q4 sales down y/y due to the unfavorable impact of a stronger dollar.

Syngenta AG (SYT +9.24%) rose nearly 2% in pre-market trading after Monsanto said it's considering another takeover bid for the company.

Fairchild Semiconductor International (FCS +0.68%) climbed nearly 7% in pre-market trading after ON Semiconductor Corp. agreed to buy the company for about $2.4 billion.

Lowe's (L -0.21%) rose over 1% in pre-market trading after it reported Q3 EPS of 80 cents, better than consensus of 78 cents.

Exxon Mobile (XOM -1.16%) was downgraded to 'Underperform' from 'Market Perform' at Raymond James.

Sally Beauty Holdings (SBH +4.65%) was upgraded to 'Buy' from 'Neutral' at Goldman Sachs.

Norfolk Southern (NSC -1.51%) jumped over 6% in after-hours trading after Canadian Pacific Railway proposed a merger with Norfolk and promised a "sizable premium" for the company. CSX Corp. (CSX -0.51%) also gained on the news and rose over 2%.

Universal Insurance (UVE -30.73%) jumped nearly 7% in after-hours trading after the company said statements made by short sellers Lakewood Capital are "misleading" and contain "partial" information.

Jack in the Box (JACK -0.72%) climbed over 3% in after-hours trading after it reported Q4 adjusted EPS of 62 cents, below consensus of 65 cents, but said it sees adjusted fiscal 2016 EPS of $3.55-$3.70, above the consensus estimate of $3.55.

Vipshop Holdings (VIPS +0.24%) rose nearly 2% in after-hours trading after it reported Q3 earnings per ADS were 12 cents, right on consensus, and said its board approved a $300 million stock buyback program over the next 2 years.

Citrix Systems (CTXS -1.26%) fell over 3% in after-hours trading after it said it sees 2016 non-GAAp EPS of $4.40-$4.50, above consensus of $4.22, but said it foresees 2016 revenue rising by 1% to 2%, below current consensus of a 4.7% increase.

MARKET COMMENTS

Dec E-mini S&Ps (ESZ15 +0.11%) this morning are up +3.25 points (+0.16%). Tuesday's closes: S&P 500 -0.13%, Dow Jones +0.04%, Nasdaq +0.01%. The S&P 500 on Tuesday closed slightly lower on the unexpected -0.2% decline in U.S. Oct industrial production (weaker than expectations of +0.1%) and the unexpected -2 point decline in the Nov NAHB housing market index to 62 (versus expectations of 64). Stocks found support from a rally in European stocks on optimism that the ECB may consider adding to stimulus next month when Executive Board member Praet said there's a risk of inflation expectations becoming de-anchored. There was also strength in retailers led by rallies in Wal-Mart and Home Depot after both companies reported higher-than-forecast Q3 earnings results.

Dec 10-year T-notes (ZNZ15 -0.06%) this morning are down -1.5 ticks. Tuesday's closes: TYZ5 +4.50, FVZ5 +3.50. Dec T-notes on Tuesday closed little changed. T-notes found support on the unexpected decline in U.S. Oct industrial production and the unexpected drop in the Nov NAHB housing market index. T-notes were undercut by the as-expected increase in U.S. Oct core CPI of +1.9% y/y, which bolstered expectations for the Fed to raise interest rates at next month's FOMC meeting.

The dollar index (DXY00 -0.11%) this morning is down -0.120 (-0.12%). EUR/USD (^EURUSD) is up +0.0029 (+0.27%). USD/JPY (^USDJPY) is down-0.06 (-0.05%). Tuesday's closes: Dollar Index +0.189 (+0.19%), EUR/USD -0.0044 (-0.41%), USD/JPY +0.27 (+0.22%). The dollar index on Tuesday rallied to a 7-month high and closed higher on weakness in EUR/USD, which slumped to a 7-month low after ECB Executive Board member Praet said the ECB may consider adding to stimulus next month because there's a risk of inflation expectations becoming de-anchored. Meanwhile, USD/JPY rallied to a 1-week high on carryover from Monday's gains on speculation the larger-than-expected contraction in Japan Q3 GDP will prompt the BOJ to expand stimulus.

Dec crude oil (CLZ15 +1.62%) this morning is up +63 cents (+1.55%) and Dec gasoline (RBZ15 +2.42%) is up +0.0271 (+2.19%). Tuesday's closes: CLZ5 -0.62 (-1.49%), RBZ5 +0.0094 (+0.76%). Dec crude oil and gasoline on Tuesday settled mixed. Crude oil was undercut by the rally in the dollar index to a 7-month high and comments from Iran's Oil Minister Zanganeh who said that Iran won't negotiate with or seek permission from OPEC before boosting its oil exports by a planned 500,000 bpd once sanctions are removed and is unconcerned about the impact the additional supply may have on crude prices. Crude oil prices were also undercut by expectations for Wednesday' EIA data to show crude inventories rose +2.0 million bbl. Gasoline found support on expectations for Wednesday' EIA data to show gasoline supplies fell -1.5 million bbl.

GLOBAL EVENT CALENDAR11/18/2015
US0700 ETWeekly MBA mortgage applications, previous -1.3% with purchase sub-index +0.1% and refi sub-index -2.2%.
0800 ETNew York Fed President William Dudley, Atlanta Fed President Dennis Lockhart and Cleveland Fed President Loretta Mester speak on a panel about payment systems at the Clearing House Annual Conference in New York.
0830 ETOct housing starts expected -3.8% to 1.160 million, Sep +6.5% to 1.206 million. Oct building permits expected +3.8% to 1.147 million, Sep -4.8% to 1.105 million.
1030 ETEIA Weekly Petroleum Status Report.
1200 ETDallas Fed President Rob Kaplan speaks at the University of Houston on A Discussion of Economic Conditions and Federal Reserve Policy.
1400 ETMinutes of the Oct 27-28 FOMC meeting.
EUR0500 ETEurozone Sep construction output, Aug -0.2% m/m and -6.0% y/y.
JPN1850 ETJapan Oct trade balance expected -246.3 billion yen, Sep -115.8 billion yen. Oct exports expected -2.0% y/y, Sep +0.5% y/y. Oct imports expected -8.6% y/y, Sep -11.0% y/y.
2330 ETJapan Sep all-industry activity index expected +0.2% m/m, Aug -0.2% m/m.
U.S. STOCK CALENDAR11/18/2015

CompanyTickerTimeEvent DescriptionPeriodEstimate
Target CorpTGT USBef-mktQ3 2016 Earnings ReleaseQ3 20160.86
Lowe's Cos IncLOW USBef-mktQ3 2016 Earnings ReleaseQ3 20160.779
AramarkARMK USBef-mktQ4 2015 Earnings ReleaseQ4 20150.398
Staples IncSPLS US6:00Q3 2016 Earnings ReleaseQ3 20160.349
Staples IncSPLS US8:00Q3 2016 Earnings CallQ3 2016
Towers Watson & CoTW US8:00Extraordinary Shareholders Meeting
Towers Watson & CoTW US8:00Special Meeting - M&A Vote
Owens CorningOC US8:30Investor DayY 2015
Atmos Energy CorpATO US9:00Analysts MeetingY 2015
Lowe's Cos IncLOW US9:00Q3 2016 Earnings CallC3 2016
Lowe's Cos IncLOW US9:00Q3 2016 Earnings CallQ3 2016
Global Payments IncGPN US9:00Annual General Meeting
Monsanto CoMON US10:00Analyst Meeting - Biennial Investor EventY 2015
AramarkARMK US10:00Q4 2015 Earnings CallQ4 2015
Target CorpTGT US10:30Q3 2016 Earnings CallQ3 2016
Sysco CorpSYY US11:00Annual General Meeting
Clorox Co/TheCLX US12:00Annual General Meeting
Oracle CorpORCL US13:00Annual General MeetingY 2015
Campbell Soup CoCPB US16:00Annual General Meeting
Keurig Green Mountain IncGMCR US17:00Q4 2015 Earnings CallQ4 2015
NetApp IncNTAP US17:00Q2 2016 Earnings CallQ2 2016
salesforce.com incCRM US17:00Q3 2016 Earnings CallQ3 2016
L Brands IncLB USAft-mktQ3 2016 Earnings ReleaseQ3 20160.528
Sigma-Aldrich CorpSIAL USAft-mktIllumina Inc. Replaces Sigma-Aldrich Corp. in S&P 500
Keurig Green Mountain IncGMCR USAft-mktQ4 2015 Earnings ReleaseQ4 20150.709
NetApp IncNTAP USAft-mktQ2 2016 Earnings ReleaseQ2 20160.569
Illumina IncILMN USAft-mktIllumina Inc. Replaces Sigma-Aldrich Corp. in S&P 500
salesforce.com incCRM USAft-mktQ3 2016 Earnings ReleaseQ3 20160.187
Campbell Soup CoCPB USAnnual General Meeting
Clorox Co/TheCLX USAnnual General Meeting
Equifax IncEFX USInvestor Meeting - BostonY 2015
Progressive Corp/ThePGR USOctober 2015 Sales and Revenue Release2015
Raymond James Financial IncRJF USOctober 2015 Sales and Revenue Release - Operating Data2015
Sysco CorpSYY USAnnual General Meeting
Global Payments IncGPN USAnnual General Meeting