Benzinga Market Primer: Friday, August 9: Futures Lower On Mixed China Data

Futures Lower On Mixed China Data

U.S. equity futures traded lower in early pre-market trade following a mixed set of data from China. China released four separate key data points, all of which served to create more uncertainty over the fate of the world's second largest economy than to alleviate fears of a slowdown.

Top News

In other news around the markets:

• Chinese industrial production rose 9.7 percent in July, besting the forecast of a gain of 9.0 percent and posting a sharp increase from June's 8.9 percent growth rate. Year-to-date, industrial production has grown 9.4 percent vs. 10.3 percent in 2012 through July.


• Chinese fixed asset investment, a proxy for corporate investment, rose 20.1 percent in July, slightly better than the forecast 20.0 percent gain and flat from June's reading.


• Chinese retail sales rose 13.2 percent in May, missing the forecast of a gain of 13.5 percent and dropping slightly from June's 13.3 percent rate of growth.


• Chinese inflation was cooler than expected in July with CPI inflation rising 2.7 percent from a year ago, worse than the forecast 2.8 percent rise and flat from June's reading. Producer prices fell 2.3 percent, an improvement from June's decline of 2.7 percent but below the forecast decline of 2.2 percent.


• S&P 500 futures fell 3.9 points to 1,689.90.


• The EUR/USD was higher at 1.3385.


• Spanish 10-year government bond yields fell one basis point to 4.51 percent.


• Italian 10-year government bond yields fell one basis point to 4.19 percent.


• Gold fell 0.08 percent to $1,308.80 per ounce.

Asian Markets

Asian shares were mixed overnight following the mixed bag of China data. The Japanese Nikkei 225 Index rose 0.07 percent and the Topix Index gained 0.12 percent. In Hong Kong, the Hang Seng Index rose 0.7 percent on reports that China will launch deposit insurance this year while the Shanghai Composite Index gained 0.36 percent. Also, the Korean Kospi fell 0.17 percent and Australian shares fell 0.19 percent.

European Markets

European shares were mostly lower in early trade on little news. The Spanish Ibex Index fell 0.13 percent and the Italian FTSE MIB Index declined 0.23 percent. Meanwhile, the German DAX slipped 0.2 percent and the French CAC 40 Index declined 0.2 percent while U.K. shares rose 0.24 percent.

Commodities

Commodities were mixed as oil bounced from Thursday's losses. WTI Crude futures rose 0.44 percent to $103.85 per barrel and Brent Crude futures gained 0.13 percent to $106.82 per barrel. Copper futures fell 0.03 percent to $327.15 per pound. Gold was lower and silver futures were flat at $20.20 per ounce.

Currencies

Currency markets were quiet overnight as the dollar was roughly flat. The EUR/USD was slightly higher at 1.3385 and the dollar was flat against the yen. Overall, the Dollar Index was marginally higher on strength against the Canadian dollar.

Earnings Reported Yesterday

Key companies that reported earnings Thursday include:

• Priceline.com PCLN reported second quarter EPS of $9.70 vs. $9.38 expected on revenue of $1.68 billion vs. $1.66 billion expected.


• Agrium AGU reported second quarter EPS of $4.94, in line, on revenue of $7.02 billion vs. $6.95 billion expected.


• Canadian Solar CSIQ reported a second quarter loss of $0.29 per share vs. a loss of $0.20 per share expected on revenue of $380.4 million vs. $419.83 million expected.


• Molycorp MCP reported a loss of $0.36 per share vs. an expected loss of $0.23 per share on revenue of $136.9 million vs. $157.56 million expected.


• Rackspace Hosting RAX reported second quarter EPS of $0.16 vs. $0.13 expected on revenue of $375.8 million.

Pre-Market Movers

Stocks moving in the pre-market included:

• Wright Medical Group WMGI shares fell 10.94 percent as the company disclosed an FDA non-approval for one of its products.


• Priceline.com PCLN shares rose 5.99 percent pre-market following its earnings beat.


• Raxspace Hosting RAX shares rose 11.65 percent pre-market following its earnings beat.


• Canadian Solar CSIQ shares fell 0.84 percent pre-market after declining nearly 8 percent intraday. Solar earnings have been relatively poor overall in second quarter earnings season, with First Solar FSLR, SolarCity SCTY, and Ascent Solar ASTI all reporting worse than expected earnings, to name a few.

Earnings

Notable companies expected to report earnings Friday include:

• Magna International MGA is expected to report second quarter EPS of $1.62 vs. $1.48 a year ago on revenue of $8.52 billion vs. $7.73 billion a year ago.


• Beacon Roofing Supply BECN is expected to report third quarter EPS of $0.71 vs. $0.62 a year ago on revenue of $670.44 million vs. $560.53 million a year ago.

Economics

On the economics calendar Friday, the wholesale trade report is due out alongside the Canadian employment report.

Good luck and good trading.

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

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