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Lea Jakobiak
Facebook, Apple and Netflix are all in the tech news this week and after some earlier doubts about their individual performance, things appear to be looking up.
Article / 13 February 2013 at 7:08 GMT

Market Preview: EU industrial prod. and US retail sales in focus

SaxoBankUK SaxoBankUK
Saxo Capital Markets UK
United Kingdom

Forex Overnight: EUR trading weak
Currency Intraday
The EUR is trading lower against major currencies this morning. In his State of Union address, US President Barack Obama urged  Congress to support his plans to boost investments and revive the economy. Meanwhile, investors are keeping an eye on the Bank of England’s (BoE) quarterly inflation report slated for later today, while Eurozone industrial production and US retail sales are also expected to garner market attention. At 6am GMT, the EUR had declined 0.1 percent against both the USD and GBP to trade at USD 1.3443 and GBP 0.8575 respectively.

The JPY has strengthened 0.8 percent against the EUR and 0.5 percent against the USD ahead of the nation’s fourth quarter Gross Domestic Product data and monetary policy decision, both due tomorrow.

UK Stocks: Likely to open lower
FTSE 100
The FTSE 100 is expected to open 23 to 25 points in negative territory.

No major economic indicators are slated for release today. Markets are keeping an eye on the BoE's Quarterly Inflation Report and governor Mervyn King’s speech, scheduled for later today.

Reckitt Benckiser Group (RB), Tullow Oil (TLW), Telecity Group (TCY), African Barrick Gold (ABG), Pan African Resources (PAF), Anglo Pacific Group (APF) and Town Centre Securities (TCSC) are scheduled to report their results today.

Shell Oil, the US subsidiary of Royal Dutch Shell (RDSA), has stated that a fire at its refinery in Deer Park, Texas, was quickly isolated and controlled to one unit.

A Republican lawmaker has urged US authorities not to rush in settling the case with BP (BP/) over the 2010 Deepwater Horizon oil spill.

Rio Tinto (RIO) has agreed to keep its Gove alumina refinery in Australia open following government efforts to find a cheaper source of energy for the plant.

According to Reuters, Bumi (BUMI) has agreed on a deal that would allow Indonesia’s Bakrie Group to divest its 23.8 percent stake in the company in exchange for a 10.3 percent stake in Bumi’s PT Bumi Resources.

Asia: Trading mostly firmer
Nikkei 225
Asian markets are trading mostly higher this morning.

In Japan, Pioneer Corporation (6773) slumped after it indicated plans to cut about 800 jobs and expected to post a full-year loss. Olympus Corporation (7733) declined after it lowered its full-year earnings guidance, citing weak camera sales. Tokyo Electric Power (9501) lost value after announcing it would open a bidding process to build fossil-fired power plants. Daikin Industries (6367) has retreated after a broker downgraded its rating on the stock to “Under Perform” from “Out Perform”. Gree (3632) registered losses after it reported a drop in its first half-year operating profit and trimmed its full-year operating profit outlook. Mitsubishi Materials (5711) dropped after it lowered its full-year operating profit forecast. At 6am GMT, the Nikkei 225 was down 1.4 percent at 11,215.0.

In South Korea, Samsung Electronics (005930), Kia Motors (000270) and Hyundai Motor (005380) added value on the back of a  weaker Won. However, Meritz Finance Group (138040) declined amid reports that it was pursuing a rights issue. Woongjin Holdings (016880) lost value after it unveiled a capital reduction plan. Markets in China and Hong Kong are closed on account of a holiday.

US Stocks: Futures trading in positive territory
S&P 500
At 6am GMT, S&P 500 futures was trading 0.5 points stronger.

Advance Retail Sales, Business Inventories, Import & Export Price Indices and MBA Mortgage Applications are the key economic indicators slated for release today.

Cisco Systems (CSCO), Mondelez International (MDLZ), Duke Energy (DUK), MetLife (MET), Deere & Company (DE), CenturyLink (CTL), Thomson Reuters (TRI), Whole Foods Market (WFM) and Liberty Global (LBTYA) will report their results later today.

In the after-hours trading session on Tuesday, Comcast Corporation (CMCSA) and General Electric (GE) jumped 7.1 percent and 3.6 percent respectively after the former agreed to purchase the remaining 49 percent stake in the NBCUniversal joint venture from the latter for about USD 16.7 billion. Additionally, Comcast Corporation reported an increase in its fourth quarter profit, hiked its dividend payout and indicated plans to repurchase shares worth USD 2bn. Moody's Corporation (MCO) climbed 2.1 percent following its plan to buy back additional shares worth USD 1bn. On the downside, dismal fourth quarter results dragged Bankrate (RATE) and Rackspace Hosting (RAX) 18.5 percent and 9.6 percent lower respectively. Cliffs Natural Resources (CLF) tumbled 10.1 percent after it swung to a fourth quarter loss and slashed its quarterly dividend payout.  

The S&P 500 index yesterday advanced 0.2 percent in the regular trading session ahead of  Mr Obama’s State of the Union address. Upbeat fourth quarter profit led Avon Products (AVP) to rally 20.3 percent. Masco Corporation (MAS) soared 12.5 percent and Fossil (FOSL) 3 percent after they posted better-than-expected fourth quarter results. Assurant (AIZ), a seller of insurance on foreclosed homes, climbed 6.7 percent after the federal regulator rejected Fannie Mae’s attempt to cut costs for back-up homeowners’ insurance policies. Coca-Cola (KO) retreated 2.7 percent after it reported a lower-than-estimated fourth quarter revenue. Apple (APPL) dropped 2.5 percent after its chief executive, Tim Cook, called a shareholder lawsuit against the company a “silly sideshow”. Dun & Bradstreet (DNB) slumped 7.7 percent after it posted downbeat fourth quarter results. Qualcomm (QCOM) declined 1.9 percent after a broker downgraded its rating on the stock to “Neutral” from “Overweight”. McGraw-Hill (MHP) edged 0.6 percent lower after it swung to a fourth quarter loss.

European Stocks: Expected to open mixed
EU Stoxx 50
The DAX is expected to open 2 to 7 points higher, while the CAC is likely to open 1 to 4 points weaker.

Eurozone Industrial Production, German Wholesale Price Index, Swiss Producer & Import Price Indices and the Portuguese Unemployment Rate are the key economic indicators slated for release today.

Total SA (FP), Heineken NV (HEIA), ING Groep NV (INGA), Telenor ASA (TEL), Societe Generale SA (GLE), Saipem SpA (SPM), Euler Hermes SA (ELE), Peugeot SA (UG) and TUI AG (TUI1) will report their results later today.

The UK’s National Institute for Health and Clinical Excellence has not approved Novartis AG’s (NOVN) Jakavi drug for the treatment of myelofibrosis, citing higher costs.

Macro Update
Obama proposes plan to reignite economy
In his annual State of the Union address, Mr Obama urged Congress to support his plans to create jobs for the middle class and spur investment in infrastructure projects to boost economic growth. He also assured he would begin talks of free trade between the US and European Union to revive the job market and boost exports.

Central bank’s policy guidance risks stoking inflation, says Fed’s Plosser
Charles Plosser, the president of the Philadelphia Federal Reserve Bank, indicated that forward guidance provided by the US Federal Reserve could put at risk longer-term inflation expectations. He also said the Fed should be more vocal about the likely future path of interest rates.

Fed’s Lockhart sees bond purchases through second half of 2013
Dennis Lockhart, the president of the Atlanta Federal Reserve Bank, said the central bank would need to continue with its bond-buying programme in the second half of 2013, while growth prospects would depend on a resolution of fiscal challenges faced by the economy.

Excessive central bank support further deepened the crisis in 2007-08, says Fed’s Lacker
Jeffrey Lacker, the president of the Richmond Federal Reserve Bank, said early rescue measures taken by the central bank during 2007 and 2008 probably deepened the financial crisis and made financial institutions dependent on the federal government.

US unexpectedly posts a budget surplus
The US Treasury Department has unexpectedly reported a budget surplus of USD 2.9bn in January, the first surplus in five years and compared with a USD 27.4bn deficit recorded in January last year.

Japan’s domestic CGPI rises
The domestic Corporate Goods Price Index (CGPI) advanced 0.4 percent month-on-month in January compared with a downwardly revised 0.2 percent increase posted in the previous month.

Tertiary industrial activity in Japan climbs more than expected
On a seasonally adjusted monthly basis, the tertiary industry activity index in Japan rose 1.4 percent in December, more than market expectations and compared with a downwardly revised 0.4 percent decline in November.

Australian consumer sentiment improves
The Westpac Bank and the Melbourne Institute’s consumer confidence index in Australia climbed to 108.3 in February, the highest level since December 2010 and compared with 100.6 recorded in the previous month.

Economic Calendar

Country

GMT

Economic Indicator

Relevance

Consensus/
*Actual

Previous

Frequency

US

0:30

President Obama’s Speech

High

-

-

-

Germany

7:00

Wholesale Price Index (YoY) (Jan)

Low

2.20%

3.20%

Monthly

Switzerland

8:15

Producer & Import Prices (YoY) (Jan)

Low

1.00%

1.00%

Monthly

Eurozone

10:00

Industrial Production w.d.a. (YoY) (Dec)

Medium

-2.30%

-3.70%

Monthly

UK

10:30

BoE Quarterly Inflation Report

High

-

-

-

UK

10:30

BoE Governor King’s Speech

Medium

-

-

-

Portugal

11:00

Unemployment Rate (Q4)

Low

-

15.80%

Quarterly

US

12:00

MBA Mortgage Applications (8 Feb)

Low

-

3.40%

Weekly

US

13:30

Advance Retail Sales (MoM) (Jan)

High

0.10%

0.50%

Monthly

US

13:30

Retail Sales Ex Autos (MoM) (Jan)

Medium

0.10%

0.30%

Monthly

US

13:30

Export Price Index (YoY) (Jan)

Low

-

1.10%

Monthly

US

13:30

Import Price Index (YoY) (Jan)

Low

-1.00%

-1.50%

Monthly

US

15:00

Business Inventories (Dec)

Medium

0.20%

0.30%

Monthly

US

15:00

Treasury Secretary Nominee Lew’s Speech

Medium

 

 

 

Japan

23:50

Gross Domestic Product, Prelim (QoQ) (Q4)

High

0.10%

-0.90%

Quarterly

US

-

Mortgage Delinquencies (Q4)

Low

-

7.40%

Quarterly

US

-

MBA Mortgage Foreclosures (Q4)

Low

-

4.10%

Quarterly


See today's events updated in real-time in our Financial Calendar on TradingFloor.com

Corporate Calendar

Country

Company Name

Index

Announcement

UK

African Barrick Gold Plc

FTSE All Share

Final

UK

Anglo Pacific Group Plc

FTSE All Share

Final

UK

Reckitt Benckiser Group Plc

FTSE All Share

Final

UK

Speedy Hire Plc

FTSE All Share

Trading

UK

Telecity Group Plc

FTSE All Share

Final

UK

Town Centre Securities Plc

FTSE All Share

Interim

UK

Tullow Oil Plc

FTSE All Share

Final

Netherlands

ING Groep NV

EuroStoxx 50

Final

France

Societe Generale SA

CAC 40, EuroStoxx 50

Final

France

Total SA

CAC 40, EuroStoxx 50

Q4 Earnings Release

US

Applied Materials Inc.

S&P 500

Q1 Earnings Release

US

CenturyLink Inc.

S&P 500

Q4 Earnings Release

US

Cisco Systems Inc.

S&P 500

Q2 Earnings Release

US

Dean Foods Co.

S&P 500

Q4 Earnings Release

US

Deere & Co.

S&P 500

Q1 Earnings Release

US

Dr Pepper Snapple Group Inc.

S&P 500

Q4 Earnings Release

US

Duke Energy Corp.

S&P 500

Q4 Earnings Release

US

Hospira Inc.

S&P 500

Q4 Earnings Release

US

Lorillard Inc.

S&P 500

Q4 Earnings Release

US

Metlife Inc.

S&P 500

Q4 Earnings Release

US

Mondelez International Inc.

S&P 500

Q4 Earnings Release

US

NetApp Inc.

S&P 500

Q3 Earnings Release

US

NVIDIA Corp.

S&P 500

Q4 Earnings Release

US

Pioneer Natural Resources Co.

S&P 500

Q4 Earnings Release

US

TripAdvisor Inc.

S&P 500

Q4 Earnings Release

US

Whole Foods Market Inc.

S&P 500

Q1 Earnings Release

Ex-Dividend Calendar

Country

Company Name

Index

Announcement

UK

Sage Group

FTSE 100

Final Ex-Dividend

UK

BP Plc

FTSE 100

Quarterly Ex-Dividend

UK

Royal Dutch Shell Plc

FTSE 100

Quarterly Ex-Dividend

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