Morning Call For Tuesday, June 6
OVERNIGHT MARKETS AND NEWS
Jun E-mini S&Ps (ESM17 -0.30%) this morning are down =0.18% and European stocks are down -0.51% as event risks prompt long liquidation in stocks. The markets are awaiting Thursday’s general election in the UK, the ECB meeting and former FBI chief Comey's congressional testimony. The uncertainty caused by these event risks has boosted safe-haven demand for precious metals with Aug COMEX gold (GCQ17 +1.01%) up +0.89% at a 6-week high. Weakness in mining stocks is another negative for equity prices as Jul COMEX copper (HGN17 -1.43%) falls -1.37% to a 2-week low. On the positive side for European stocks was increased optimism in the economic outlook after the Eurozone Jun Sentix investor confidence rose more than expected to a nearly 10-year high. Asian stocks settled mixed: Japan -0.95%, Hong Kong +0.52%, China +0.34%, Taiwan -0.20%, Australia -1.52%, Singapore -0.08%, South Korea closed for holiday, India -0.38%. Japan's Nikkei Stock Index was under pressure from losses in exporting stocks due to strength in the yen as USD/JPY slid to a 6-week low.
The dollar index (DXY00 -0.08%) is down -0.09% at a 6-3/4 month low. EUR/USD (^EURUSD) is down -0.10%. USD/JPY (^USDJPY) is down -0.91% at a 6-week low.
Sep 10-year T-note prices (ZNU17 +0.30%) are up +8 ticks.
Eurozone Jun Sentix investor confidence rose +1.0 to 28.4, stronger than expectations of no change at 27.4 and the highest in 9-3/4 years.
U.S. STOCK PREVIEW
Key U.S. news today includes: (1) Apr JOLTS job openings (expected -5,000 to 5.738 million, Mar +61,000 to 5.743 million).
Notable Russell 2000 earnings reports today include: Michaels Cos (consensus $0.39), HD Supply (0.66), Keysight Technologies (0.57).
U.S. IPO's scheduled to price today: none.
Equity conferences: American Society of Clinical Oncology Meeting on Mon-Tue, Bank of America Merrill Lynch Energy Credit Conference on Mon-Tue, Goldman Sachs Lodging, Gaming, Restaurant and Leisure Conference on Tue, Wells Fargo Financial Services Investors Forum on Tue, Stifel Technology Internet & Media Conference on Tue, Bank of America Merrill Lynch Global Technology Conference on Tue-Wed, NAREIT REITWeek Investor Forum on Tue-Wed, RBC Global Energy & Power Executive Conference on Tue-Wed, Stephens Spring Investment Conference on Tue-Wed, Robert W. Baird Global Consumer, Technology & Services Conference on Tue-Thu, Jefferies Global Health Care Conference on Tue-Fri, Deutsche Bank Global Industrials and Materials Summit on Wed-Thu, Sandler O'Neill Global Exchange and Brokerage Conference on Wed-Thu, Goldman Sachs European Financial Conference on Wed-Fri, Macquarie Group Ltd Canadian Energy Conference on Thu, Gabelli & Company Entertainment Conference on Thu, Citi Small and Mid Cap Conference on Thu-Fri.
OVERNIGHT U.S. STOCK MOVERS
Cognizant (CTSH +0.13%) was downgraded to 'Hold' from 'Buy' at Societe Generale.
ITT Inc (ITT -0.62%) was downgraded to 'Neutral' from 'Buy' at Goldman Sachs.
Old Dominion Freight Line (ODFL +1.22%) was upgraded to 'Neutral' from 'Underperform' at Bank of America/Merrill Lynch with a price target of $96.
Thor Industries (THO +1.12%) climbed almost 5% in after-hours trading after it reported Q3 EPS from continuing operations of $2.11, better than consensus of $1.87.
MRC Global (MRC +1.51%) was rated a new 'Buy' at Stifel with a price target of $22.
Casey’s General Stores (CASY +0.11%) fell 4% in after-hours trading after it reported Q4 EPS of 76 cents, below consensus of 85 cents.
Signet Jewelers Ltd (SIG -0.26%) dropped nearly 4% in after-hours trading after COO Bryan Morgan resigned on Jun 2 due to violations of company policy unrelated to financial matters.
Resolute Energy (REN -1.50%) rose almost 5% in after-hours trading after it said it began a registered-exchange offer to exchange up to $125 million its outstanding 8.5% senior notes due 2020.
Alere (ALR -0.49%) moved up over 2% in after-hours trading after it filed a 10-K for 2016 after months of delay and reported Q4 revenue of $597 million, right on consensus.
Coupa Software (COUP -0.44%) gained over 2% in after-hours trading after it reported Q1 revenue of $41.1 million, above consensus of $38.33 million, and then raised its view for full-year revenue to $172 million-$175 million, better than consensus of $168.71 million.
Acorda Therapeutics (ACOR +0.66%) jumped over 6% in after-hours trading after it hit its goal and showed statistically significant improvement in motor function versus a placebo in a Phase 3 trial of CVT-301 on patients with Parkinson's disease.
MARKET COMMENTS
June E-mini S&Ps (ESM17 -0.30%) this morning are down -4.50 points (-0.18%). Monday's closes: S&P 500 -0.12%, Dow Jones -0.10%, Nasdaq -0.06%. The S&P 500 on Monday closed lower on the -0.6 point decline in the U.S. May ISM non-manufacturing index to 56.9 (weaker than expectations of -0.4 to 57.1) and weakness in energy stocks as crude oil prices fell -0.55%. Stocks found support on the larger-than-expected upward revision to U.S. Q1 non-farm productivity (revised upward to unch from -0.6%, better than expectations of an upward revision to -0.2%), and on the as-expected -0.2% decline in U.S. Apr factory orders and the upward revision to Mar factory orders to +1.0% from the previously reported +0.2%.
Sep 10-year T-notes (ZNU17 +0.30%) this morning are up +8 ticks. Monday's closes: TYU7 -5.50, FVU7 -3.25. Sep 10-year T-notes on Monday closed lower on carry-over weakness from a drop in German bund prices and on supply concerns as more than $1.25 billion of corporate debt issuance came to market on Monday, which pushed T-notes lower as bond dealers sold 10-year T-notes to hedge against the new supply.
The dollar index (DXY00 -0.08%) this morning is down -0.086 (-0.09%) at a 6-3/4 month low. EUR/USD (^EURUSD) is down -0.0011 (-0.10%) and USD/JPY (^USDJPY) is down -1.00 (-0.91%) at a 6-week low. Monday's closes: Dollar index +0.085 (+0.09%), EUR/USD -0.0025 (-0.22%), USD/JPY +0.05 (+0.05%). The dollar index on Monday closed higher on the stronger-than-expected U.S. Q1 non-farm productivity report and on the increase in T-note yields, which improves the dollar's interest rate differentials.
Jul WTI crude oil prices (CLN17 -0.40%) this morning are up +1 cent (+0.02%) and July gasoline (RBN17 -0.38%) is -0.0006 (-0.04%) at a 3-1/2 week low. Monday's closes: Jul crude -0.26 (-0.55%), Jul gasoline -0.0390 (-2.47%). Jul crude oil and gasoline on Monday closed lower with Jul gasoline at a 3-week low. Crude oil prices were boosted by a stronger dollar. Crude oil prices were undercut by the slide in the crack spread to a 3-week low, which may curb refinery demand for crude to refine into gasoline, and by last Friday's Baker Hughes report that active U.S oil rigs in the week ended Jun 2 rose +11 to a 2-year high of 733 rigs.
Disclosure: None.