Gold Member
Posts: 24638
Liked By: 14428
Joined: 16 Apr 12
Followers:
6
Tipsters
Championship:
Player
has
not started
|
Caution ahead of influx of corporate earnings this week
Pre-Market Open Commentary for 15 April 2013
DJIA: 14865.06 -0.08
Nasdaq Composite: 3294.95 -5.21
Good morning, fellow investors
US stocks clawed back steeper losses to close marginally in the red last
Friday, breaking a four-day winning streak, following a series of
disappointing economic reports and mixed bank results. The Dow Jones
Industrial Average closed flat, dipping a mere 0.08 points while the S&P
500 lost 0.28% and the Nasdaq 500 fell 0.16%.
US retail sales contracted in March for the second time in three months, a
sign that US economy may have stumbled at the end of 1Q2013. Retail sales
unexpectedly fell 0.4% in March led by weakness in electronics and gasoline
prices, disappointing market expecting a flat reading for the month. Adding
to concerns, consumer sentiment fell to a nine-month low in April with the
University of Michigan's preliminary index reading on consumer sentiment
falling to 72.3, below expectations of a reading of 78.5 and down from 78.6
last month. Business inventories data was also weaker than expected, edging
up just 0.1% in February, the weakest gain since June, and missing
expectations for a rise of 0.4%.
A separate report showed that US producer prices recorded the biggest drop
in 10 months, with the producer price index (PPI) falling 0.6% in March,
after rising 0.7% in February, as the cost of gasoline tumbled. In the 12
months through March, PPI rose 1.1%, the smallest rise since July. Core
PPI, excluding volatile food and energy costs, was also muted, rising 0.2%
for a third straight month and in the 12 months through March, core PPI
increased 1.7% after rising by a similar margin in February. The latest
reading signaled inflation remained contained, providing leeway for the
Federal Reserve to maintain its accommodative monetary policy.
The first-quarter results of JP Morgan Chase (JPM) failed to impress
markets after the bank reported stronger than expected earnings per share
of US$1.59 (against expectations of US$1.40 per share) but weaker than
expected revenue of US$25.8bil (against expectations of US$25.9mil). Income
in its biggest businesses - investment banking and consumer lending - fell
excluding accounting adjustments. Stock and bond trading revenue also fell.
Outstanding loans grew by just 1%, and profit margins on lending narrowed.
Shares of JPM slipped 0.6%. Wells Fargo also reported stronger than
expected earnings with earnings rising 22% YoY to US$5.2 bil or US$0.92 per
share in the first three months of 2013 but missed on revenue estimates.
Despite the jump in earnings, market reacted with caution and shares of
Wells Fargo fell 0.8% on concerns over falling profitability in a record
low interest rate environment and slower loans growth.
Despite the lacklustre session last Friday, all three stock indices closed
the week more than 2% higher with the Dow Jones Industrial Average gaining
2.06% while the S&P 500 rose 2.29% to 1588.85. The Nasdaq 500 gained 2.84%
for the week.
In the week ahead, market will focus on corporate earnings spanning across
the banking, consumer, pharmaceutical, technology and industrial sectors,
mining reports for companies’ outlook and guidance for the short to medium
term. From the banks, Citigroup, Bank of America, Goldman Sachs and Morgan
Stanley will report quarterly results throughout the week and the first
quarter results of these banks are expected to be subdued in view of record
low interest rates. The technology companies including Yahoo, eBay, Google,
IBM, Intel, Microsoft, Nokia and Verizon will also report this week.
On the economic calendar, the Empire state and Philadelphia Fed surveys
will provide market a fresh look at regional manufacturing activity. Market
will also look to the housing market data, including readings on housing
starts, building permits, the National Association of Home Builders housing
market index and the MBA mortgage index for signs of ongoing recovery in
the sector which has been supporting overall economic growth. On Wednesday,
the Fed will also release its beige book on economic activity.
A firmer greenback led crude oil for May delivery declining US$2.22 a
barrel, or 2.37%, to settle at US$91.29 a barrel last Friday, which dragged
down crude oil prices for May delivery by US$1.41 a barrel, or 1.52% for
the past week.
In Singapore today:
Despite firm overnight leads from Wall Street, Asian stock markets closed
lower on profit-taking ahead of the weekend and on concerns over ongoing
geopolitical tension between North and South Korea. Singapore shares
declined in light trading as an unexpected contraction of 0.6% YoY in the
advance estimate on the Singapore economy in 1Q2013 weighed on sentiment.
The STI index retreated 14.61 points, or 0.44%, to end at 3294.19 last
Friday and for the week, the benchmark index slipped 5.59 points, or 0.19%.
Expect the local bourse to kick start this week on a subdued note taking
leads from market weakness on Wall Street last Friday following
disappointing economic readings showing signs that the world largest
economic recovery may have stumbled at the end of 1Q2013. Trading is also
expected to be subdued ahead of the US earnings season which will come into
full gear this week, as market players await multi-national companies to
shed light on the industry and global economic outlook. Geopolitical
tension between North and South Korea will also dampen sentiment.
1. Chartzones – 12 April 2013 (premium)
Conglomerate / Industrial and Property Stocks
....
|
Main Menu >
Stocks, FX, Cryptocurrencies & Commodities Forum >
SPH, Ezra (15 Apr 2013)
[ 205 Chatters Online
]
1
) 
Find all Topics Started by stand up n wake up
Find all Posts by stand up n wake up
Follow / Unfollow
PM stand up n wake up
15-Apr 2013 Monday
11:40 AM (4031 days ago)
0 Likes
Like
