Market Overview

#PreMarket Primer: Friday, November 22: Draghi Defends ECB Rate Cut

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European Central Bank President Mario Draghi defended the bank's recent rate cut at a talk in Germany this week, saying that the bank acted in the best interest of the eurozone as a whole.

Germans have been increasingly dissatisfied with the bank's decisions, saying help to struggling eurozone countries is coming at the expense of German taxpayers. While speaking on Thursday, Draghi reassured investors that the eurozone was not falling into a “lost decade” and said the bank's recent rate cut was designed to help keep inflation from falling closer to zero.

Top News

In other news around the markets:

  • The Wall Street Journal reported that the Swedish music streaming service Spotify is set to receive nearly $250 million in new financing. Technology Crossover Ventures will be the largest contributor to the funds, which are earmarked to help the company grow globally.
  • Tension between Indonesia and Australia over spying accusations exposed by Edward Snowden's leaked security documents is beginning to affect business ties between the two nations. A state owned Indonesian firm has suspended cooperation with Australian cattle ranchers, citing trust issues as the reason. Protestors burning Australian flags outside the Australian embassy in Indonesia returned for a second day on Friday and demanded Australian Prime Minister Tony Abbott apologize.
  • Iranian officials have begun to establish ties with Western oil companies like Chevron and Royal Dutch Shell in the hopes that talks between World powers in Geneva result in the easing of sanctions on Iranian oil. Currently, the sanctions are keeping more than half of Iran's crude oil exports from reaching the market.
  • The US Treasury Department announced that it was planning to sell its remaining 31.1 million shares of General Motors by the end of 2013. The government took a 61 percent stake in the company at the height of the financial crisis in one of the most controversial government interventions. Of the original $50 billion investment, $38.4 billion has been recouped, and the sale of the government's remaining stake will likely raise another $1.2 billion.

Asian Markets

Asian markets were mixed on Friday, the Japanese NIKKEI was up 0.10 percent, but China's Shanghai composite lost 0.43 percent and the Shenzhen composite was down 0.40 percent. The South Korean KOSPI gained 0.62 percent and Australia's ASX 200 was up 0.90 percent.

European Markets

European markets were also mixed, the UK's FTSE slipped 0.10 percent and the eurozone's STOXX 600 gained 0.05 percent. France's CAC 40 was up 0.25 percent and the Spanish IBEX gained 0.20 percent.

Commodities

Energy futures reeled in yesterday's gains; Brent futures were down 0.07 percent and WTI futures lost 0.29 percent. Gold lost 0.06 percent and sliver was down 0.18 percent. Industrial metals were higher with copper u p 0.33 percent and aluminum up 0.22 percent.

Currencies

The euro gained 0.24 percent against the dollar on Friday morning and the pound to dollar ratio was flat. The dollar gained 0.11 percent against the yen and 0.80 percent against the Australian dollar.

Earnings

Notable earnings released on Thursday included:

  • Target Corporation (NYSE: TGT) reported third quarter EPS of $0.84 on revenue of $17.26 billion, compared to last year’s EPS of $0.81 on revenue of $16.93 billion.
  • Gamestop Corporation (NYSE: GME) reported third quarter EPS of $0.58 on revenue of $2.11 billion, compared to last year’s EPS of $0.38 on revenue of $1.77 billion.
  • Abercrombie & Fitch Company (NYSE: ANF) reported a third quarter loss of $0.20 per share on revenue of $1.03 billion, compared to last year’s EPS of $1.02 on revenue of $1.17 billion.
  • Gap Inc. (NYSE: GPS) reported third quarter EPS of $0.72 on revenue of $3.98 billion, compared to last year’s EPS of $0.63 on revenue of $3.98 billion.

Pre-Market Movers

Stocks moving in the Premarket included:

  • AbbVie Inc. (NYSE: ABBV) gained 1.13 percent in premarket trade after climbing 1.29 percent on Thursday.
  • Time Warner Cable Inc. (NYSE: TWC) rose 1.04 percent in premarket trade after losing 1.81 percent on Wednesday.
  • Yum! Brands Inc (NYSE: YUM) gained 0.69 percent in premarket trade after rising 3.60 percent on Thursday
  • Caterpillar Inc. (NYSE: CAT) rose 0.22 percent in premarket trade after losing 1.93 percent over the past week.
  • United States Steel Corp (NYSE: X) lost 0.70 percent in premarket trade after losing 1.63 percent over the past five days

Earnings

No notable earnings expected on Friday.

Economics

Notable economic releases expected on Friday include German GDP, the German LFO business climate index, Italian retail sales, and Canadian retail sales.

For a recap of Thursday’s market action click here.

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

Posted-In: Earnings News Eurozone Futures Commodities Forex Events Global Best of Benzinga

 

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