Overnight Markets And News

Sep E-mini S&Ps (ESU18 -0.08%) this morning are up +0.02% and European stocks are down -0.11%. Sep E-mine S&Ps posted a new 4-month high in overnight trade on strength in bank stocks. Bank of America is up 2% in pre-market trading after it reported Q2 adjusted EPS of 64 cents, higher than expectations of 57 cents, and Deutsche Bank AG jumped 5% after it said it sees Q2 quarterly earnings results well above market expectations. Gains in the overall market were limited due to weakness in energy stocks. Energy stocks retreated as Aug WTI crude oil prices (CLQ18 -1.63%) fall -1.62% on signs that Saudi Arabia is boosting oil supplies after people with knowledge of the matter said Saudi Arabia is offering extra crude oil cargoes on top of its contractual supplies to some buyers in Asia for August delivery. Also, the Trump administration said it is actively considering tapping into the Strategic Petroleum Reserve in an attempt to lower domestic gasoline prices. Asian stocks settled mostly lower: Japan closed for holiday, Hong Kong +0.05%, China -0.61%, Taiwan -0.43%, Australia -0.43%, Singapore -0.85%, South Korea -0.43%, India -0.60%. Chinese stocks fell back on mixed economic data after China's Jun industrial output slowed more than expected, although Jun retail sales increased more than expected and Q2 GDP growth came in right on expectations.

The dollar index (DXY00 -0.35%) is down -0.21%. EUR/USD (^EURUSD +0.34%) is up +0.31%. USD/JPY (^USDJPY unch) is down -0.04%.

Sep 10-year T-note prices (ZNU18 -0-010) are down -1 tick.

China Jun industrial production rose +6.0% y/y, weaker than expectations of +6.5% y/y.

China Q2 GDP grew at a 6.7% y/y pace, right on expectations.

China Jun retail sales rose +9.0% y/y, stronger than expectations of +8.8% y/y.

U.S. Stock Preview

Key U.S. news today includes: (1) Jun retail sales (expected +0.5% and +0.3% ex autos, May +0.8% and +0.9% ex autos), (2) Jul Empire manufacturing index (expected -4.0 to 21.0, Jun +4.9 to 25.0), (3) May business inventories (expected +0.4%, Apr +0.3%), (4) USDA weekly grain export inspections, (5) USDA weekly Crop Progress.

Notable S&P 500 earnings reports today include: Bank of America (consensus $0.57), Blackrock (6.57), Netflix (0.79), JB Hunt Transportation (1.28).

U.S. IPO's scheduled to price today: none.

Equity conferences during the remainder of this week: Sprott Natural Resource Symposium on Wed, 64th ISTH (International Society on Thrombosis and Haemostasis) Conference on Wed.

Market Comments

Sep S&P 500 E-minis (ESU18 -0.08%) this morning are up +0.50 points (+0.02%) at a new 4-month high. Friday's closes: S&P 500 +0.11%, Dow Jones +0.38%, Nasdaq 100 +0.13%. The S&P 500 on Friday rallied to a 5-1/2 month high and closed higher on strength in technology stocks as the Nasdaq Composite rallied to a new all-time high. There was also strength in energy stocks as crude oil prices rose +0.97%. Stocks were undercut by the -1.1 point decline in the University of Michigan U.S. Jul consumer sentiment to a 6-month low of 97.1, weaker than expectations of -0.2 to 98.0.

Sep 10-year T-notes (ZNU18 -0-010) this morning are down -1 tick. Friday's closes: TYU8 +6.50, FVU8 +4.75. Sep 10-year T-notes on Friday closed higher on the Fed's semi-annual report to Congress that pledged a gradual pace of interest rate increases. T-note prices were also supported by the weaker-than-expected University of Michigan U.S. Jul consumer sentiment report that fell to a 6-month low.

The dollar index (DXY00 -0.35%) this morning is down -0.199 (-0.21%), EUR/USD (^EURUSD +0.34%) is up +0.0036 (+0.31%) and USD/JPY (^USDJPY unch) is down -0,05 (-0.04%). Friday's closes: Dollar Index -0.054 (-0.06%), EUR/USD +0.0013 (+0.11%), USD/JPY -0.17 (-0.15%). The dollar index on Friday closed lower on the weaker-than-expected University of Michigan U.S. Jul consumer sentiment index and on the decline in T-note yields, which undercut the dollar's interest rate differentials.

Metals this morning are mixed with Aug gold (GCQ18 +0.28%) +2.9 (+0.23%), Sep silver (SIU18 +0.16%) +0.015 (+0.09%), and Sep copper (HGU18 -0.59%) -0.019 (-0.68%). Friday's closes: Aug gold -5.40 (-0.43%), Sep silver -0.162 (-1.01%), Sep copper -0.0015 (-0.05%). Metals on Friday closed lower with Aug gold at an 11-3/4 month low and Sep silver at a 1-year low. Metals prices were undercut by fund selling of gold as long gold positions in ETF's fell to 3-3/4 month low. Copper found support on signs of tighter supplies after weekly Shanghai copper inventories fell -23,982 MT to a 4-1/2 month low of 234,696 MT.

Aug WTI crude oil prices (CLQ18 -1.63%) this morning are down -$1.15 a barrel (-1.62%) and Aug gasoline (RBQ18-1.56%) is -3.43 (-1.63%). Friday's closes: Aug crude +0.68 (+0.97%), Aug gasoline +3.50 (+1.69%). Aug crude oil and gasoline on Friday closed higher on the rally in the S&P 500 to a 5-1/2 month high, which shows confidence in the economic outlook that may lead to increased energy demand. Crude oil prices were also supported by the increase in the crack spread to a 2-week high, which gives incentive for refiners to purchase crude to refine into gasoline.

Overnight U.S. Stock Movers

Bank of America (BAC -0.76%) is up 2% in pre-market trading after it reported Q2 adjusted EPS of 64 cents, higher than consensus of 57 cents.

United Parcel Service (UPS +0.41%) was upgraded to 'Buy' from 'Neutral at UBS with a price target of $125.

Public Storage (PSA -0.63%) was downgraded to 'Underperform' from 'In-line' at Evercore ISI with a price target of $217.

Hasbro (HAS -0.90%) was downgraded to 'Underperform' from 'Market Perform' at BMO Capital Markets with a price target of $75.

Veoneer (VNE -1.12%) was rated a new 'Outperform' at BMO Capital Markets with a price target of $55.

Knight-Swift Transportation Holdings (KNX -0.21%) was upgraded to 'Overweight' from 'Equal-Weight' at Barclays with a price target of $55.

Novocure Ltd (NVCR -0.75%) was rated a new 'Outperform' at Evercore ISI with a price target of $46/

Autoliv (ALV +0.62%) was upgraded to 'Outperform' from 'Neutral' at Daiwa Securities with a price target of $118.

JM Smucker (SJM +1.21%) may open higher initially this morning after it boosted its quarterly dividend after the close Friday to 85 cents a share from 78 cents, above consensus of 82 cents.

Ryder System (R +0.70%) may open higher initially this morning after it unexpectedly boosted its quarterly dividend after the close Friday to 54 cents a share from 52 cents a share.

Skyline Champion (SKY -0.24%) filed to sell up to $100 million of its common stock under shelf registration.

Sangamo Therapeutics (SGMO -1.63%) fell 2% in after-hours trading after CTO Michael Holmes resigned effective July 20 to join a startup biotech company. He will be re[laced by Edward Rebar.

Mustang Bio (MBIO +0.67%) filed a $75 million mixed securities shelf.

ShiftPixy (PIXY +68.61%) rose 2% in after-hours trading after it reported Q3 preliminary gross billings rose $60.2 million versus $27.5 million y/y.