Stock Market Update from Briefing.com

Briefing.com

10:00 am: [BRIEFING.COM] The S&P 500 trades higher by 0.5%.

Just reported, existing home sales hit an annualized rate of 5.04 million units in June, while the Briefing.com consensus expected a reading of 5.00 million. The pace for June was up from the prior month's revised rate of 4.91 million units (from 4.89 million).

9:45 am: [BRIEFING.COM] As expected, the major averages began the session on a strong note with small caps in the lead. The Russell 2000 is higher by 0.6%, while the S&P 500 trades up 0.3% with eight sectors in the green.

Energy (+0.9%) and health care (+0.8%) have grabbed the early lead, while industrials (+0.6%) and technology (+0.6%) follow not far behind. On the flip side, countercyclical consumer staples (-0.3%) and telecom services (-0.3%) hold modest losses.

Also of note, transport stocks have shown noteworthy strength and the Dow Jones Transportation Average currently trades higher by 0.8%.

Treasuries remain little changed with the 10-yr yield at 2.47%.

The Existing Home Sales report for June will be released at 10:00 ET (Briefing.com consensus 5.00 million).

9:15 am: [BRIEFING.COM] S&P futures vs fair value: +6.80. Nasdaq futures vs fair value: +18.70. The stock market is on track for an upbeat open with futures on the S&P 500 trading just below their best levels of the morning (seven pts above fair value). Futures held slim gains during the early part of the night, but climbed to highs shortly after markets in Europe opened for business. Like U.S. futures, European markets trade near their best levels of the day with earnings in focus.

Domestically, participants have also been responding to earnings with a full slate of companies reporting their results today. Notably, Chipotle Mexican Grill (CMG 654.03, +64.10) is indicated to open higher by 10.9% after beating estimates. On the flip side, Dow component McDonald's (MCD 95.35, -2.20) is on track to begin the session with a 2.3% loss in reaction to its below-consensus results.

Outside of McDonald's, another Dow component, Travelers (TRV 92.63, -2.63), also reported below-consensus earnings, while Coca-Cola (KO 41.37, -1.03) and Verizon (VZ 50.94, +0.24) beat by one cent each. Also of note, United Technologies (UTX 113.49, +0.51) surpassed estimates and DuPont (DD 65.70, +0.16) reported in line with its warning from June 26.

On the economic front, consumer prices increased 0.3% in June, down from a 0.4% increase in May. The Briefing.com consensus expected the CPI to increase 0.3%. As expected from the June PPI report, a strong increase in energy prices, up 1.6% in June, was the main catalyst for the overall increase in consumer prices. That was the largest increase in monthly energy costs since December. Gasoline costs rose 3.3% after increasing 0.7% in May. Food prices moderated a bit in June. Prices increased only 0.1% after growing by at least 0.4% per month since February. Excluding food and energy, core CPI increased 0.1% in June after increasing 0.3% in May. The consensus expected core prices to increase 0.2%.

Treasuries are little changed with the 10-yr yield at 2.47%.

9:04 am: [BRIEFING.COM] S&P futures vs fair value: +5.90. Nasdaq futures vs fair value: +17.70. The S&P 500 futures trade six points above fair value.

The May Housing Price Index from the FHFA rose 0.4%, which followed a revised increase of 0.1% observed during the prior month (from 0.0%).

8:58 am: [BRIEFING.COM] S&P futures vs fair value: +6.70. Nasdaq futures vs fair value: +18.50. The S&P 500 futures trade seven points above fair value.

The major Asian indices ended on a higher note. The Japanese government lowered its 2014 growth forecast to 1.2% from 1.4%, citing weak demand from emerging markets. Elsewhere, Reserve Bank of Australia Governor Glenn Stevens reiterated the central bank's view that a period of stable rates is likely, and that animal spirits are needed to help the real economy.

  • Economic data was limited: 
    • Japan's All Industries Activity Index rose 0.6% month-over-month (forecast 0.7%; prior -4.6%) 
    • Taiwan's unemployment rate held at 4.0% 
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  • Japan's Nikkei added 0.8%, finishing just shy of six-month highs as traders returned to work following the extended holiday weekend. The weaker yen provided a boost for exporters as Honda Motor climbed 0.5% and Canon added 0.3%. 
  • Hong Kong's Hang Seng surged 1.7% to an eight-month high. Real estate developers led the way on word more cities were easing restrictions. China Overseas Land & Investment and China Resources Land rallied 4.4% and 3.2%, respectively. 
  • China's Shanghai Composite rose 1.0%, finishing at its best level in over a month. Automakers provided support after Beijing once again promoted electric and hybrid vehicles. BYD jumped 5.6% to lead the space higher. 
Major European indices trade higher across the board, attempting to recoup yesterday's losses, while regional foreign ministers are expected to discuss additional sanctions against Russia.
  • Participants received just three data points: 
    • Switzerland's trade surplus narrowed to CHF1.377 billion from CHF2.849 billion (forecast CHF2.970 billion) 
    • CBI Industrial Trends Orders in Great Britain fell to 2 from 11 (forecast 8) and Public Sector Net Borrowing came in at GBP9.51 billion (expected GBP9.20 billion; previous GBP11.86 billion) 
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  • Great Britain's FTSE trades higher by 0.9% with ARM Holdings in the lead. The chipmaker trades up 4.9% after reporting in-line results. Staple stocks underperform with Tesco, J Sainsbury, and WM Morrison Supermarkets down between 0.9% and 3.7%. 
  • Germany's DAX holds an advance of 0.9%. Conglomerate Siemens outperforms with an increase of 1.7%, while Infineon Technologies follows not far behind (+1.6%). Adidas lags, down 0.8%. 
  • In France, the CAC is higher by 1.0%. Oil companies lead with Technip and Total up 2.7% and 2.0%, respectively. Publicis Groupe is lower by 5.2% following disappointing results. 
  • Italy's MIB is higher by 1.7% amid broad strength. Banco Popolare, Pirelli, and Saipem are up between 2.5% and 3.4%.

8:32 am: [BRIEFING.COM] S&P futures vs fair value: +7.00. Nasdaq futures vs fair value: +19.20. The S&P 500 futures trade seven points above fair value.

Total CPI increased 0.3% (Briefing.com consensus +0.3%) in June while core CPI, which excludes food and energy, increased 0.1% (Briefing.com consensus +0.2%). On a year-over-year basis, total CPI is up 2.1% and core CPI is up 1.9%.

7:56 am: [BRIEFING.COM] S&P futures vs fair value: +4.30. Nasdaq futures vs fair value: +14.70. U.S equity futures trade near their pre-market highs amid upbeat action overseas. The S&P 500 futures hover four points above fair value.

Reviewing overnight developments:

  • Asian markets ended on a higher note. Japan's Nikkei +0.8%, China's Shanghai Composite +1.0%, and Hong Kong's Hang Seng +1.7% 
    • Economic data was limited: 
      • Japan's All Industries Activity Index rose 0.6% month-over-month (forecast 0.7%; prior -4.6%) 
    • In news: 
      • Japan cut its GDP forecast to 1.2% from 1.4%, which had been expected
  • Major European indices trade higher across the board. Great Britain's FTSE +0.8%, Germany's DAX +0.8%, and France's CAC +0.8%. Elsewhere, Italy's MIB +1.3% and Spain's IBEX +1.0% 
    • Economic data was limited: 
      • Switzerland's trade surplus narrowed to CHF1.377 billion (forecast CHF2.970 billion; prior CHF2.849 billion) 
      • CBI Industrial Trends Orders in Great Britain fell to 2 from 11 (forecast 8) and Public Sector Net Borrowing came in at GBP9.51 billion (expected GBP9.20 billion; previous GBP11.86 billion) 
    • Among news of note: 
      • European markets are recouping a portion of yesterday's loss while regional foreign ministers are expected to discuss additional sanctions against Russia
In U.S. corporate news:
  • Chipotle Mexican Grill (CMG 652.00, +62.07): +10.5% after beating estimates and surpassing comparable restaurant sales growth expectations 
  • Netflix (NFLX 455.09, +3.14): +0.7% following its in-line quarterly report 
  • Texas Instruments (TXN 48.90, -0.27): -0.6% despite beating estimates and guiding in line with expectations 
  • Coca-Cola (KO 42.00, -0.40): -0.9% in reaction to its one-cent beat on below-consensus revenue 
  • DuPont (DD 65.61, +0.07): +0.1% after reporting results in line with its June 26 warning. The company guided Q3 earnings below consensus and boosted its quarterly dividend to $0.47/share 
  • Travelers (TRV 92.10, -3.16): -3.3% after missing the Capital IQ consensus estimate by $0.14 
  • United Technologies (UTX 114.00, +1.02): +0.9% following its above-consensus results and improved guidance 
  • Verizon (VZ 50.22, -0.48): -1.0% despite reporting a one-cent beat on better than expected revenue 
CPI data for June (Briefing.com consensus 0.3%) and core CPI data (Briefing.com consensus 0.2%) will be released at 08:30 ET. The FHFA Housing Price Index for May (prior 0.0%) and the Existing Home Sales report for June (Briefing.com consensus 5.00 mln) will follow at 09:00 and 10:00 ET, respectively. 

6:46 am: [BRIEFING.COM] S&P futures vs fair value: +3.50. Nasdaq futures vs fair value: +11.50.

6:46 am: [BRIEFING.COM] Nikkei...15343.28...+127.60...+0.80%.  Hang Seng...23782.11...+395.00...+1.70%.

6:46 am: [BRIEFING.COM] FTSE...6783.68...+55.20...+0.80%.  DAX...9694.87...+82.80...+0.90%.

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