Benzinga Market Primer: Wednesday, July 24: Apple Earnings Beat

Futures Higher After Apple Earnings

U.S. equity futures rose in the pre-market after Apple AAPL reported better than expected third quarter results. Also, CFO Peter Oppenheimer hinted at many new products later this year when he said on the conference call that Apple will have a "very busy fall."

Top News

In other news around the markets:

• The Chinese Flash HSBC Manufacturing PMI fell to 47.7 for the first half of July compared to the June reading of 48.2 on expectations of a flat reading. However, this index focuses on smaller companies so it is no surprise that the Chinese credit crunch is affecting operations at these companies.


• Eurozone PMIs strongly beat expectations in both the manufacturing and services sectors. The flash reading of the manufacturing PMI rose to 50.1 for the first half of July from 48.8 in June, beating expectations of a reading of 49.1 while the services PMI rose to 49.6 from 48.3 on expectations of a reading of 48.7.


• Japan's trade deficit in June unexpectedly widened to 180.8 billion yen vs. the expected deficit of 161 billion although it improved from May's deficit of 994 billion yen.


• S&P 500 futures rose 4.4 points to 1,690.20.


• The EUR/USD was higher at 1.3239.


• Spanish 10-year government bond yields rose 1 basis point to 4.69 percent.


• Italian 10-year government bond yields were flat at 4.37 percent.


• Gold rose 0.49 percent to $1,341.70 per ounce.

Asian Markets

Asian shares were mixed overnight as markets reacted to lots of regional economic data. The Japanese Nikkei 225 Index declined 0.32 percent and the Topix Index fell 0.23 percent. In Hong Kong, the Hang Seng Index rose 0.24 percent while the Shanghai Composite Index fell 0.52 percent in China. Also, the Korean Kospi rose 0.42 percent and Australian shares gained 0.36 percent.

European Markets

European shares were higher in early trade on the back of the stronger than expected PMI data. The Spanish Ibex Index rose 1.11 percent and the Italian FTSE MIB Index gained 0.73 percent. Meanwhile, the German DAX rose 0.61 percent and the French CAC 40 Index gained 0.9 percent while U.K. shares rose 0.61 percent.

Commodities

Commodities were mixed overnight as gold futures rose while the spot price fell. WTI Crude futures gained 0.02 percent to $107.25 per barrel and Brent Crude futures declined 0.42 percent to $107.96 per barrel. Copper futures rose 0.41 percent to $321.10 per pound. Gold was higher and silver futures gained 0.15 percent to $20.29 per ounce.

Currencies

Currency markets were on the move overnight as the yen and the Aussie dollar weakened following economic data. The EUR/USD was higher at 1.3239 and the dollar rose against the yen to 100.05. Overall, the Dollar Index rose 0.11 percent on strength against the yen, the Swiss franc, the Canadian dollar, and the pound. Also, the Australian dollar was sharply weaker, declining 0.85 percent against the U.S. dollar, 0.22 percent against the yen, and 0.96 percent against the euro.

Earnings Reported Yesterday

Key companies that reported earnings Tuesday include:

• Apple AAPL reported third quarter EPS of $7.47 vs. $7.31 expected on revenue of $35.3 billion vs. $35.09 billion expected.


• Norfolk Southern NSC reported second quarter EPS of $1.46 vs. $1.49 expected on revenue of $2.8 billion vs. $2.85 billion expected.


• Broadcom BRCM reported second quarter EPS of $0.70 vs. $0.68 expected on revenue of $2.09 billion vs. $2.1 billion expected.
• FMC Technologies FTI reported second quarter EPS of $0.44 vs. $0.47 expected on revenue of $1.71 billion vs. $1.64 billion expected.


• VMWare VMW reported second quarter EPS of $0.79 vs. $0.77 expected on revenue of $1.24 billion vs. $1.23 billion expected.


• Juniper Networks JNPR reported second quarter EPS of $0.29 vs. $0.25 expected on revenue of $1.15 billion vs. $1.09 billion expected.

Pre-Market Movers

Stocks moving in the pre-market included:

• Apple AAPL shares rose 3.58 percent pre-market after the company beat analyst estimates.


• VMware VMW shares rose 12.02 percent pre-market after it also reported a better than expected quarter.


• U.S> Steel X shares declined 0.21 percent pre-market on China fears following the weak Chinese PMI figure.


• Transition Therapeutics TTHI shares rose 22.42 percent pre-market after the company announced a new licensing agreement with Eli Lilly LLY after the close yesterday.

Earnings

Notable companies expected to report earnings Wednesday include:

• Baidu BIDU is expected to report second quarter EPS of $1.21 vs. $1.24 a year ago.


• Boeing BA is expected to report second quarter EPS of $1.57 vs. $1.27 a year ago.


• Caterpillar CAT is expected to report second quarter EPS of $1.70 vs. $2.54 a year ago.


• Delta Airlines DAL is expected to report second quarter EPS of $0.94 vs. $0.69 a year ago.


• EMC EMC is expected to report second quarter EPS of $0.42 vs. $0.39 a year ago.


• Facebook FB is expected to report second quarter EPS of $0.14 vs. $0.12 a year ago.


• Ford F is expected to report second quarter EPS of $0.37 vs. $0.30 a year ago.


• PepsiCo PEP is expected to report second quarter EPS of $1.19 vs. $1.12 a year ago.


• Qualcomm QCOM is expected to report third quarter EPS of $1.03 vs. $0.85 a year ago.


• Visa V is expected to report third quarter EPS of $1.79 vs. $1.56 a year ago.

Economics

On the economics calendar Wednesday, MBA Purchase Applications and the flash PMI Manufacturing Index is due out as well as new home sales and a 5-year note auction. Overnight, the German IFO Business Climate Index and the British GDP report are due out.

Good luck and good trading.

Tune into Benzinga's PreMarket Info show with Dennis Dick and Joel Elconin here.

For a recap of Tuesday's market action, read Benzinga's daily market wrap here.