#PreMarket Primer: Monday, April 14: Military Action In Ukraine Looking More Likely

Ukrainian officials have given pro-Russian separatists a strict deadline to disarm or face a “full scale anti-terrorist operation."

Ahead of the Monday morning deadline, the United Nation’s Security Council called an emergency meeting on Sunday night to discuss the rising tension between Moscow and Kiev.

With between 35,000 and 40,000 Russian troops stationed at the Ukrainian border and a further 25,000 in recently annexed Crimea, markets have been jittery as the prospect of a military clash between the two nations becomes more and more likely.

Most expect that the US and Europe will slap Moscow with further sanctions if the crisis continues to escalate.

In other news around the markets:

• Japanese Prime Minister Shinzo Abe and Bank of Japan Governor Haruhiko Kuroda have decided to hold regular meetings this month, something many have taken as a sign that Abe may be concerned about the yen’s recent performance. Though Kuroda has been decidedly bullish about the nation’s economy and expects that Japan will meet its two percent inflation target by April next year, the revival of regular meetings between the two has reignited speculation that the bank could provide additional stimulus.
• Amazon.com has announced that it is planning to release a smartphone during the second half of 2014 as the company tries to push into the hardware space. According to the Wall Street Journal, people close to the company have said it hopes to introduce the phone, which may have screen capable of producing 3-D images without the use of glasses, in June and begin shipping it by the end of September.
• The International Monetary Fund’s policy committee wrapped up its weekend meetings with stronger calls to combat falling inflation. The fund has said that downward price pressure has been a key factor dragging down the global recovery. The warnings are mostly targeted at the eurozone, where inflation has dropped to just 0.5 percent, far below the ECB’s 2 percent target.
• In an attempt to trim its expenses and adjust to evolving regulations and loan demand, Citigroup cut between 200 and 300 employees last week. The company’s cuts will make up about 2 percent of the global market and included Steve Prince, younger brother to the company’s former Chief Executive Charles Prince.

Asian Markets

Asian markets were mostly lower with the exception of the Shenzhen composite, which gained 0.42 percent and the Hang Seng index, which was up 0.06 percent. The Japanese NIKKEI lost 0.36 percent, the Shanghai composite was down 0.12 percent and Australia’s ASX 200 lost 1.28 percent.

European Markets

European markets were down across the board; the UK’s FTSE lost 0.61 percent and the eurozone STOXX 600 was down 0.69 percent. The German DAX fell 0.79 percent and France’s CAC 40 was down 0.64 percent.

Commodities

Energy futures rose following news that problems in Ukraine were escalating. Brent futures gained 0.48 percent and WTI futures were up 0.42 percent. Gold and silver rose by 0.62 percent and 0.47 percent respectively, but industrial metals were mixed with zinc down 0.61 percent but copper up 0.13 percent.

Currencies

The euro slid as the ECB attempted to verbally devalue the currency. The euro lost 0.32 percent against the dollar, 0.31 percent against the pound and 0.36 percent against the yen following the remarks. The dollar gained 0.23 percent against the franc and remained steady against the yen and the pound.

Earnings

Notable earnings released on Friday included:

• Wells Fargo & Company WFC reported first quarter EPS of $1.05 on revenue of $20.84 billion, compared to last year’s EPS of $0.92 on revenue of $21.26 billion.
• JP Morgan Chase & Co  JPM reported first quarter EPS of $1.28 on revenue of $22.99 billion, compared to last year’s EPS of $1.59 on revenue of $24.85 billion.
• Fastenal Company FAST reported first quarter EPS of $0.38 on revenue of $876.50 million, compared to last year’s EPS of $0.37 on revenue of $806.33 million.

Pre-Market Movers

Stocks moving in the Premarket included:

• The Coca-Cola Co KO was up 0.96 percent in premarket trade after gaining 1.07 percent last week.
• Carnival Corp CCL was down 1.38 percent in premarket trade after losing 1.04 percent on Friday.
• Johnson & Johnson JNJ lost 0.42 percent in premarket trade after falling 1.57 percent over the past five days.
• Bank of America Corp BAC fell 0.38 percent in premarket trade after losing 5.68 percent last week.
• Citigroup Inc. C was down 0.26 percent in premarket trade after losing 1.19 percent on Friday.

Earnings

Notable earnings releases expected on Friday include:

• Pinnacle Financial Partners, Inc. PNFP is expected to report first quarter EPS of $0.45 on revenue of $58.52 million, compared to last year’s EPS of $0.39 on revenue of $54.66 million.
• Citigroup Inc. C is expected to report first quarter EPS of $1.18 on revenue of $19.61 billion, compared to last year’s EPS of $1.23 on revenue of $20.49 billion.
• J.B. Hunt Transport Services, Inc. JBHT is expected to report first quarter EPS of $0.66 on revenue of $1.42 billion, compared to last year’s EPS of $0.61 on revenue of $1.29 billion.

Economics

Friday economic calendar will be relatively quiet with releases including US retail sales, eurozone industrial production, Italian CPI, and the Reserve Bank of Australia’s meeting minutes.

For a recap of Friday’s market action, click here.

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