Mar E-mini S&Ps (ESH18 +0.08%) are up +0.12% amid speculation Congress will pass a stopgap spending measure by Friday night to avert a government shutdown. Stock markets around the world also received support from stronger than expected China Q4 GDP, which is positive for global growth. European stocks are up +0.12% on positive carry-over from the upbeat Chinese economic data. Feb WTI crude oil (CLG18 +0.16%) is up slightly by +0.14% and is giving energy stocks a boost after API data late Wednesday showed U.S. crude inventories fell -5.12 million bbl last. The markets will eye today's EIA data to confirm the signs of tighter crude supplies. Asian stocks settled mixed: Japan -0.44%, Hong Kong +0.43%, China +0.87%, Taiwan +0.61%, Australia -0.02%, Singapore -0.58%, South Korea -0.02%, India +0.51%. China's Shanghai Composite climbed to a new 2-year high on positive economic data on GDP and industrial production. Japan's Nikkei Stock Index fell back from a new 26-year high and closed lower on as losses in bank stocks and chemical companies weighed on the overall market.
The dollar index (DXY00-0.02%) is up +0.04% as the increase in the 10-year T-note yield to a 10-month high improves the dollar's interest rate differentials. EUR/USD (^EURUSD) is up +0.50%. USD/JPY (^USDJPY) is down -0.05%.
Mar 10-year T-note prices (ZNH18-0.13%) are down -5.5 ticks at a new contract low and the 10-year T-note yield climbed to a 10-month high of 2.61%.
China Q4 GDP rose +6.8% y/y, stronger than expectations of +6.7% y/y.
China Dec industrial production rose +6.2% y/y, stronger than expectations of +6.1% y/y.
China Dec new home prices rose in 57 of 70 cities tracked by the government, up from 50 in Nov and the most in 6 months.
U.S. STOCK PREVIEW
Key U.S. news today includes: (1) weekly initial unemployment claims (expected -12,000 to 249,000, previous +11,000 to 261,000) and continuing claims (expected +33,000 to 1.900 million, previous -35,000 to 1.867 million), (2) Dec housing starts (expected -1.7% m/m to 1.275 million, Nov +3.3% to 1.297 million), (3) Jan Philadelphia Fed business outlook index (expected -3.1 to 24.8, Dec +3.6 to 27.9), (4) EIA weekly Petroleum Status Report, (5) Treasury auctions $13 billion of 10-year TIPS.
Notable Russell 1000 earnings reports today include: Morgan Stanley (consensus $0.77), American Express (1.54), IBM (5.17), Bank of NY Mellon (0.91), JB Hunt Transport (1.00), KeyCorp (0.36), BB&T (0.79), M&T Bank (2.40), PPG Industries (1.19), People's United Financial (0.27).
U.S. IPO's scheduled to price today: Nine Energy Service (NINE), ADT Inc (ADT).
Equity conferences this week: none.
OVERNIGHT U.S. STOCK MOVERS
Wal-Mart (WMT +2.00%) was upgraded to 'Buy' from 'Neutral' and added to the 'Conviction List' at Goldman Sachs with a price target of $117.
Cognizant Technology Solutions (CTSH +1.49%) ws upgraded to 'Buy' from 'Neutral' at Citigroup with a price target of $89.
Fluor (FLR +0.17%) was upgraded to 'Outperform' from 'Neutral' at Credit Suisse with a price target of $71.
Avexis (AVXS-0.13%) was rated a new 'Outperform' at Credit Suisse with a 12-month target price of $134.
Diamond Offshore Drilling (DO +2.54%) was downgraded to 'Neutral' from 'Buy' at Clarksons Platou Securities with a 12-month target price of $17.
Alcoa (AA +1.33%) dropped almost 5% in after-hours trading after it reported Q4 adjusted EPS of $1.04, below consensus of $1.23.
PTC Corp (PTC +2.16%) jumped 7% in after-hours trading after it reported Q1 adjusted revenue of $307 million, better than consensus of $301 million, and said it sees full-year revenue of $1.24 billion-$1.25 billion, the midpoint above consensus of $1.24 billion.
Agios Pharmaceuticals (AGIO +2.22%) slid 2% in after-hours trading after it announced that it plans to sell $400 million of its common stock in an underwritten public offering.
Eagle Point Credit (ECC-2.00%) fell nearly 4% in after-hours trading after it commenced an underwritten public offering of 1.75 million shares of its common stock.
Paratek Pharmaceuticals (PRTK-0.45%) dropped almost 9% in after-hours trading after it commenced a registered underwritten public offering of $50 million of its shares of common stock.
Electro Scientific Industries (ESIO +9.50%) surged over 20% in after-hours trading after it reported Q3 preliminary revenue of between $106 million and $111 million, well above consensus of $85 million.
Playa Hotels & Resorts NV (PLYA +0.27%) fell 4% in after-hours trading after a block of 6 million shares of its common stock was said to be offered at $10.80 to $11.00 via Morgan Stanley.
SLM Corp (SLM +0.17%) lost 2% in after-hours trading after it said it sees full-year core EP of 97 cents to $1.10, weaker than consensus of $1.04.
Arrowhead Pharmaceuticals (ARWR +2.14%) dropped 9% in after-hours trading after it announced a proposed underwritten offering of $40 million of the company's common stock.
Mar S&P 500 E-mini stock futures (ESH18 +0.08%) this morning are up +3.25 points (+0.12%). Wednesday's closes: S&P 500 +0.94%, Dow Jones +1.25%, Nasdaq +1.09%. The S&P 500 on Wednesday closed higher on optimism that Congress will pass a stopgap spending bill by Friday night to avert a government shutdown. Stocks were also boosted by the upbeat Fed Beige Book that found "the outlook for 2018 remains optimistic for a majority of contacts across the country." Energy stocks were supported by the +0.38% rally in crude oil prices.
Mar 10-year T-note prices (ZNH18-0.13%) this morning are down -5.5 ticks at a contract low. Wednesday's closes: TYH8 -10.50, FVH8 -6.00. Mar 10-year T-notes on Wednesday fell to a new contract low and closed lower on the upbeat Beige Book that found "modest to moderate" gains in economic activity in almost all 12 of the Fed districts at the start of the year, which bolsters the case for additional Fed rate hikes.
The dollar index (DXY00-0.02%) this morning is up +0.036 (+0.04%). EUR/USD (^EURUSD) is up +0.0061 (+0.50%) and USD/JPY (^USDJPY) is down -0.06 (-0.05%). Wednesday's closes: Dollar Index +0.148 (+0.16%), EUR/USD -0.0004 (-0.03%), USD/JPY -0.09 (-0.08%). The dollar index on Wednesday recovered from a 3-year low and closed higher on the Fed Beige Book that found "modest to moderate" gains in economic activity in almost all 12 of the Fed districts at the start of the year. The dollar was also boosted by the increase in T-note yields, which improved the dollar's interest rate differentials.
Feb crude oil (CLG18 +0.16%) this morning is up +9 cents (+0.14%) and Feb gasoline (RBG18 +0.38%) is +0.0069 (+0.37%). Wednesday's closes: Feb WTI crude +0.24 (+0.38%), Feb gasoline +0.0200 (+1.09%). Feb crude oil and gasoline on Wednesday closed higher with Feb gasoline at a 4-1/2 month high. Crude oil prices were boosted by increased adherence to production cuts after Dec OPEC and Russian compliance with production cuts rose to 125% from 122% in Nov, the highest since production cuts were agreed to. Crude oil prices were also boosted by expectations for Thursday's weekly EIA data to show that U.S. crude inventories fell -3.0 million bbl, the ninth consecutive weekly decline.
Metals prices this morning are mixed with Feb gold -9.3 (-0.69%), Mar silver -0.081 (-0.47%), and Mar copper +0.017 (+0.53%). Wednesday's closes: Feb gold +2.1 (+0.16%), Mar silver -0.023 (-0.13%), Mar copper -0.0305 (+0.95%). Metals on Wednesday settled mixed with Mar copper at a 4-week low. Metals prices were undercut by the rally in stocks, which curbed safe-haven demand for precious metals, and the 25 MT increase in LME copper inventories to 204,675 MT, a 1-3/4 month high. Gold prices gained on the fall in the dollar index to a 3-year low.
GLOBAL EVENT CALENDAR01/18/2018
Thursday, Jan 18
Weekly initial unemployment claims expected -12,000 to 249,000, previous +11,000 to 261,000. Weekly continuing claims expected +33,000 to 1.900 million, previous -35,000 to 1.867 million.
Dec housing starts expected -1.7% m/m to 1.275 million, Nov +3.3% to 1.297 million. Dec building permits expected -0.6% m/m to 1.295 million, Nov -1.0% to 1.303 million.
Jan Philadelphia Fed business outlook survey expected -3.1 to 24.8, Dec +3.6 to 27.9.
EIA weekly Petroleum Status Report.
Treasury announces amount of 2-year T-notes (previous $26 billion), 2-year floating-rate notes (previous $13 billion), 5-year T-notes (previous $34 billion) and 7-year T-notes (previous $28 billion) to be auctioned Jan 23-25.
Treasury auctions $13 billion of 10-year TIPS.
Friday, Jan 19
USDA weekly Export Sales.
Preliminary-Jan University of Michigan U.S. consumer sentiment expected +1.1 to 97.0, Dec -2.6 to 95.9.