Market Overview

Market Primer: Thursday, October 10: Libyan Prime Minister Kidnapped

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Libya’s Prime Minister Ali Zeidan was briefly kidnapped on Thursday morning when gunmen broke into his Tripoli hotel room.

The incident came shortly after US forces conducted a raid in which they seized Libyan Abu Anas al-Libi, a suspected al Qaeda member who participated in 1998 embassy bombings.

Although the Libyan government has denied any prior knowledge of the US raid, several powerful Islamic militant groups have accused the government of assisting with the operation.

Top News

In other news around the markets:

  • The standoff between Democrats and Republicans in Washington showed signs of progress on Wednesday after some conservative Republicans considered the idea of a short-term increase in the nation’s borrowing limit. On Thursday, House GOP leaders are set to meet with President Obama for the first time since the shutdown began.
  • After US government officials announced on Wednesday that they were going to postpone shipments of military equipment to Egypt, several of America’s Middle Eastern allies voiced their frustration with the US’ unwillingness to step in to help stabilize the region. Nations like Israel and Saudi Arabia worried that cutting off Egypt’s aid would have far reaching consequences. However, US officials defended their decisions, saying the aid would resume when Cairo begins to make a democratic transition.
  • The dollar gained after US FOMC minutes showed that the Fed’s decision not to begin tapering its bond buying program was not an easy one. The minutes boosted the US currency as they added to speculation that the central bank could cut down on its stimulus spending at its December meeting.
  • After announcing that Janet Yellen will take over as Chairman of the Federal Reserve, President Obama called for a speedy approval of her position from the Senate. With the potential US default weighing on markets, many believe Obama wants to restore confidence as Yellen’s appointment will likely improve investor sentiment.

Asian Markets

Asian markets were mixed on Thursday; the Japanese NIKKEI posted large gains, up 1.12 percent, and Indonesia’s JSX composite rose 0.68 percent. China’s Shanghai composite was down 0.94 percent and the Shenzhen composite lost 0.34 percent.

European Markets

European markets were up across the board; the UK’s FTSE gained 0.81 percent and the eurozone’s STOXX 600 was up 0.99 percent. The Spanish IBEX was up 1.61 percent and the German DAX gained 0.93 percent.

Commodities

Geopolitical tension boosted energy futures on Thursday; Brent futures were up 0.95 percent and WTI futures were up 0.40 percent. Gold lost 0.24 percent and silver was down 0.19 percent. Industrial metals were also lower with aluminum down 0.38 percent and tin down 0.74 percent.

Currencies

The euro to dollar ratio was mostly flat and the pound lost 0.13 percent against the dollar. The Yen fell 0.52 percent against the dollar.

Earnings

Notable earnings released on Wednesday included:

  • Family Dollar Stores, Inc. (NYSE: FDO) reported EPS of $0.86 on revenue of $2.50 billion, compared to last year’s  EPS of $0.75 on revenue of $2.36 billion.
  • RPM International Inc (NYSE: RPM) reported EPS of $0.77 on revenue of $1.16 billion, compared to last year’s EPS of $0.64 on revenue of $1.05 billion.
  • Del Frisco’s Restaurant Group, Inc. (NASDAQ: DFRG) reported EPS of $0.10 on revenue of $52.20 million, compared to last year’s EPS of $0.10 on revenue of $47.89 million.
  • Progressive Corporation (NYSE: PGR) reported EPS of $0.39, compared to last year’s EPS of $0.27 on revenue of $4.24 billion.

Pre-Market Movers

Stocks moving in the pre-market included:

  • Wells Fargo & Co (NYSE: WFC) gained 2.53 percent in pre-market trade after falling 2.18 percent over the past five days.
  • Hewlett-Packard Co(NYSE: HPQ) was up 1.68 percent in pre-market trade after an improving sales forecast took the stock up 8.92 percent on Wednesday.
  • Bank of America Corporation (NYSE: BAC) gained 1.08 percent in pre-market trade, adding to Wednesday’s 1.10 percent gain.
  • Delta Air Lines Inc (NYSE: DAL) gained 1.03 percent in pre-market trade after a week of choppy trading took the stock down 2.49 percent on Tuesday and 1.35 percent on Monday
  • Ford Motor Co (NYSE: F) gained 0.90 percent in pre-market trade after losing 3.43 percent over the past five days.

Earnings

Earnings reports expected on Thursday include:

  • Micron Technology, Inc. (NASDAQ: MU) is expected to report EPS of $0.24 on revenue of $2.70 billion, compared to last year’s loss of $0.24 per share on revenue of $1.96 billion.
  • Lindsay Corporation (NYSE: LNN) is expected to report EPS of $0.91 on revenue of $155.69 million, compared to last year’s  EPS of $0.68 on revenue of $127.82 million.
  • Marriot Vacations Worldwide Corporation (NYSE: VAC is expected to report EPS of $0.39 on revenue of $400.32 million, compared to last year’s EPS of $0.23 on revenue of $383.00 million.
  • Safeway Inc. (NYSE: SWY) is expected to report EPS of $0.16 on revenue of $8.52 billion, compared to last year’s EPS of $0.16 on revenue of $10.05 billion.

Economics

Economic releases expected on Thursday include, US initial and continuing jobless claims, Bank of England interest rate decision, ECB monthly report, Italian industrial production and Norwegian CPI.

Good luck with your Thursday trades!

For a recap of Wednesday’s market action, click here

Tune into Benzinga’s pre-market info show with Dennis Dick and Joel Elconin here.

Posted-In: Abu Anas al-Libi al Qaeda Ali Zeidan Federal ReserveEarnings News Eurozone Futures Commodities Previews Forex Global Economics Federal Reserve Hot Pre-Market Outlook Markets Movers Trading Ideas Best of Benzinga

 

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