Overnight Markets And News

Sep E-mini S&Ps (ESU18 +0.04%) this morning are up +0.01% in quiet trade and rose on optimism that a U.S./Canada trade deal can be reached after the Globe reported that Canada was said to be ready to make concessions on dairy for compromises in other areas. European stocks are down -0.12% and EUR/USD weakened after La Stampa reported that the Italian government was seen asking for a new round of bond purchases from the ECB to help the Italian government avoid a downgrade of its credit rating. Also, German Sep GfK consumer confidence unexpectedly fell to a 15-month low. The Turkish lira fell to a 2-week low against the dollar after Turkey's central bank reintroduced borrowing limits for banks' overnight transactions, which will tighten liquidity. Asian stocks settled mixed: Japan +0.15%, Hong Kong +0.23%, China -0.31%, Taiwan +1.00%, Australia +0.75%, Singapore -0.11%, South Korea +0.28%, India -0.45%.

The dollar index (DXY00 +0.18%) is up +0.13%. EUR/USD (^EURUSD -0.32%) is down -0.32%. USD/JPY (^USDJPY+0.03%) is up +0.01%.

Sep 10-year T-note prices (ZNU18 +0-020) are up +3 ticks.

The German Sep GfK consumer confidence unexpectedly fell -0.1 to a 15-month low of 10.5, weaker than expectations of no change at 10.6.

Japan Aug consumer confidence fell -0.2 to a 1-year low of 43.3, right on expectations.

U.S. Stock Preview

Key U.S. news today includes: (1) weekly MBA mortgage applications (previous +4.2% to 349.9 with purchase sub-index +2.9% to 232.1 and refi sub-index +6.0% to 982.7), (2) revised Q2 GDP (expected +4.0% q/q annualized vs previous +4.1%), (3) Jul pending home sales (expected +0.3% m/m and -2.5% y/y, Jun +0.9% m/m and -4.0% y/y), (4) EIA weekly Petroleum Status Report, and (5) Treasury auctions $17 billion of 2-year floating-rate notes and $31 billion of 7-year T-notes.

Notable Russell 2000 earnings reports today include: salesforce.com (consensus $0.47), Brown-Forman (0.39), Eaton Vance (0.81), Dick's Sporting Goods (1.06).

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

Equity conferences during the remainder of this week: OPEX Summer Business Transformation Leaders Summit on Mon-Wed, Seaport Global Securities Energy & Industrials Conference on Tue-Wed, Jefferies Semiconductor/Hardware Summit on Wed, Simmons European Energy Conference on Wed.

Market Comments

Sep S&P 500 E-minis (ESU18 +0.04%) this morning are u +0.25 points (+0.01%). Tuesday's closes: S&P 500 +0.03%, Dow Jones +0.06%, Nasdaq 100 +0.15%. The S&P 500 on Tuesday climbed to a fresh all-time high and closed higher on hopes that Canada will soon reach a trade deal with the U.S. after Mexico and the U.S. agreed to a new trade deal on Monday. Stocks were also supported by the unexpected +5.5 point increase in the Conference Board's U.S. Aug consumer confidence index to a 17-3/4 year high of 133.4, stronger than expectations of -0.8 to 126.6. Technology stocks again showed strength as the Nasdaq 100 rose to a new record high.

Sep 10-year T-notes (ZNU18 +0-020) this morning are up +3 ticks. Tuesday's closes: TYU8 -8.00, FVU8 -4.25. Sep 10-year T-notes on Tuesday dropped to a 1-1/2 week low and closed lower on reduced safe-haven demand for T-notes after the S&P 500 rallied to a new record high. T-notes were also undercut by the unexpected increase in U.S. Aug consumer confidence to a 17-3/4 year high, which is hawkish for Fed policy. T-notes also took a hit on increased inflation expectations after the 10-year T-note breakeven inflation rate rose to a 2-week high.

The dollar index (DXY00 +0.18%) this morning is up +0.125 (+0.13%). EUR/USD (^EURUSD -0.32%) is down -0.0038 (-0.32%). USD/JPY (^USDJPY +0.03%) is up +0.01 (+0.01%). Dollar Index -0.059 (-0.06%), EUR/USD +0.0017 (+0.15%), USD/JPY +0.11 (+0.10%). The dollar index on Tuesday fell to a 4-week low and closed lower on strength in the Canadian dollar which rose to a 2-1/2 month high against the U.S. dollar on speculation Canada will soon reach a trade deal with the U.S. after the U.S. reached a deal with Mexico on Monday. The dollar was also undercut by a rally in EUR/USD to a 4-week high on reduced Italian political risks after Italian Finance Minister Tria said Italy is not planning to breach the EU's budget deficit limit.

Metals this morning are weaker with Dec gold (GCZ18 -0.41%) -5.4 (0.44%), Sep silver (SIU18 -1.01%) -0.164 (-1.11%) and Sep copper (HGU18 -1.13%) -0.029 (-1.04%). Tuesday's closes: Dec gold -1.6 (-0.13%), Sep silver -0.085 (-0.57%), Sep copper +0.0275 (+1.02%). Metals on Tuesday settled mixed with Sep copper at a 2-week high. Metals prices were boosted by the sell-off in the dollar index to a 4-week low and by signs of stronger copper demand after LME canceled copper warrants surged +29.050 MT to a 1-year high of 132,200 MT. Metals prices were undercut by the rally in the S&P 50 to a new record high, which reduces safe-haven demand for precious metals. Precious metals prices were undercut by the unexpected surge in U.S. Aug consumer confidence to a 17-3/4 year high, which bolsters the case for additional Fed rate hikes.

Oct WTI crude oil (CLV18 +0.53%) this morning is up +34 cents (+0.50%). Oct gasoline (RBV18 +0.03%) is -0.07 (-0.04%). Tuesday's closes: Oct crude oil -0.34 (-0.49%), Oct gasoline -1.16 (-0.58%). Oct crude oil and gasoline on Tuesday closed lower on the action by oil workers on Total SA's North Sea oil platforms to maintain oil production as the workers union and Total SA agreed to mediation to solve their disputes. Crude oil prices were also undercut by comments from OPEC President Suhail Al Mazrouei who said increased production can be seen from OPEC over time as some members had a difficult time increasing output in summer due to excessive heat and maintenance. Oil prices were supported by the fall in the dollar index to a 4-week low and by expectations for Wednesday's weekly EIA crude inventories to fall -1.5 million bbl.

Overnight U.S. Stock Movers

Royal Caribbean Cruises Ltd (RCL +0.14%) was upgraded to 'Buy' from 'Hold' at Deutsche Bank with a price target of $146.

HP Enterprise (HPE +1.76%) rose nearly 3% in after-hours trading after it reported Q3 adjusted EPS of 44 cents, above consensus of 37 cents, and then raised guidance on full-year adjusted EPS to $1.50 to $1.55 from a prior view of $1.40 to $1.50.

Instructure (INST +1.27%) was rated a new 'Buy' at D.A. Davidson & Co with a price target of $47.

Roku (ROKU -1.73%) lost more than 1% in after-hours trading after The Information reported that Amazon is planning to start a free video service for the 48 million users of Fire TV streaming video service.

Weight Watchers International (WTW +0.37%) was rated a new 'Outperform' at Oppenheimer with a price target of $98.

Tilray (TLRY -3.63%) jumped 11% in after-hours trading after it reported Q2 revenue of $9.7 million, higher than consensus of $9.0 million.

Shoe Carnival (SCVL +5.91%) rallied 7% in after-hours trading after it reported Q2 EPS of 76 cents, higher than consensus of 56 cents, and then forecast full-year EPS of $2.07 to $2.15 better than consensus of $2.05.

Tailored Brands (TLRD +3.84%) dropped 6% in after-hours trading after President and COO Bruce Thorn resigned and CEO Doug Ewert said he will retire at the end of September.

H&R Block (HRB -1.84%) rose more than 3% in after-hours trading after it reported Q1 revenue of $145.2 million, stronger than consensus of $137.7 million.

Box Inc (BOX +2.35%) fell more than 3% in after-hours trading after it forecast Q3 revenue of $154 million to $155 million, the midpoint below consensus of $155 million.

NCI Building Systems (NCS +0.32%) rallied 5% in after-hours trading after it reported Q3 adjusted Ebitda of $63.3 million, higher than consensus of $60.5 million, and then forecast Q4 adjusted Ebitda of $60 million to $70 million, the midpoint above consensus of $64.4 million.

Centennial Resource Development (CDEV -0.63%) was rated a new 'Overweight' at Barclays with a price target of $24.

Aviat Networks (AVNW +1.95%) rose 5% in after-hours trading after it reported Q4 revenue of $62.5 million versus $56.4 million y/y, and then forecast 2019 revenue of $255 million to $265 million.

Prospect Capital (PSEC -0.56%) gained 2% in after-hours trading after it reported Q4 net investment of 22 cents, above consensus of 20 cents.

Affimed NV (AFMD +246.88%) climbed more than 5% in after-hours trading after surging more than 240% in Tuesday's session after the company secured an initial $96 million payment in a pact to develop cancer therapies with Roche.