Market Overview

#PreMarket Primer: Wednesday, June 25: US To Begin Exporting Oil After Almost 40 Years

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The US Commerce Department took the first step to do away with a near forty year old ban on selling unrefined US oil abroad when it approved requests from both Pioneer Natural Resources Co. and Enterprise Products Partners LP to begin selling condensate oil to foreigners.

Permission has only been granted to these two companies, but many believe that the motion to allow the export of condensate will push other businesses to ask for the same right.

The Commerce Department issued a statement on Tuesday saying that the policy on US crude oil exports hasn't changed, but The Wall Street Journal reported that the department is already working to create industry wide rules that will allow companies to ship abroad.

Top News

In other news around the markets:

  • With BNP Paribas SA facing a near $10 billion fine for violating US sanctions, many other European banks are beginning to worry that they could face a similar penalty. Deutsche Bank, UniCredit SpA and Credit Agricole SA are all being investigated for similar accusations; but if they are found guilty, fines of that magnitude could have economic repercussions across the eurozone.
  • On Wednesday, the Russian Parliament denied President Vladimir Putin's request to order military intervention in Ukraine. The decision was intended to help promote the ongoing peace efforts in Ukraine as both the Ukrainian government and pro-Russia separatists have laid down their weapons for a seven day ceasefire. However, the Parliament said Putin's ability to call on the military could be reinstated on short notice.
  • On Wednesday, US teams arrived in Iraq to help hold off the rebel militants who have gained control of much of the north of the nation. Around the same time, rebels from the Islamic State in Iraq and the Levant (ISIS) attacked one of Iraq's largest air bases in Yathrib, just 90 km from Baghdad.
  • At its annual developer conference this week, Google is expected to reveal plans to expand its software to encompass the growing variety of internet connected devices. The conference begins on Thursday morning, and will likely highlight Google's new ventures into everything from cars to televisions.

Asian Markets

Asian markets were lower; the NIKKEI fell 0.71 percent, the Shanghai composite lost 0.41 percent, the Shenzhen composite was down 0.42 percent and the KOSPI lost 0.63 percent.

European Markets

European markets were down across the board, spooked by worries about the conflict in Iraq. The FTSE was down 0.73 percent, the STOXX 600 lost 0.72 percent, the DAX fell 0.45 percent and the CAC 40 was down 0.80 percent.

Commodities

Brent futures dipped 0.63 percent as investors began to believe that the risk in Iraq has already been priced in, while WTI futures gained 0.43 percent on speculation that US oil stocks fell last week. Gold and silver were down 0.62 percent and 0.96 percent respectively, while industrial metals were mostly higher. Copper gained 0.08 percent, aluminum was up 0.32 percent and tin gained 0.11 percent.

Currencies

Currency markets were quiet on Wednesday; the euro was steady at $1.3604 and gained 0.07 percent against the pound. The dollar lost 0.07 percent against the yen, but gained 0.09 percent against the pound.

Earnings

Notable earnings released on Tuesday included:

  • Apogee Enterprises, Inc. (NASDAQ: APOG) reported first quarter EPS of $0.21 on revenue of $210.90 million, compared to last year’s EPS of $0.14 on revenue of $179.31 million.
  • Walgreen Co. (NYSE: WAG) reported third quarter EPS of $0.91 on revenue of $19.40 billion, compared to last year’s EPS of $0.85 on revenue of $18.31 billion.

Pre-Market Movers

Stocks moving in the Premarket included:

  • Xerox (NYSE: XRX) was up 1.46 percent in premarket trade after falling 1.20 percent on Tuesday.
  • Walt Disney (NYSE: DIS) gained 1.09 percent in premarket trade after losing 0.58 percent over the past five days.
  • Walgreen (NYSE: WAG) gained 0.61 percent in premarket trade after falling 1.70 percent on Tuesday.
  • Carnival Corp (NYSE: CCL) was down 0.86 percent in premarket trade after losing 2.99 percent on Tuesday.

Earnings

Notable earnings expected on Wednesday include:

  • Bed Bath & Beyond (NASDAQ: BBBY) is expected to report first quarter EPS of $0.95 on revenue of $2.69 billion, compared to last year’s EPS of $0.93 on revenue of $2.61 billion.
  • General Mills (NYSE: GIS) is expected to report fourth quarter EPS of $0.72 on revenue of $4.43 billion, compared to last year’s EPS of $0.53 on revenue of $4.41 billion.
  • Monsanto Company (NYSE: MON) is expected to report third quarter EPS of $1.55 on revenue of $4.41 billion, compared to last year’s EPS of $1.66 on revenue of $4.25 billion.
  • Barnes & Noble (NYSE: BKS) is expected to report a fourth quarter loss of $0.59 on revenue of $1.19 billion, compared to last year’s loss of $1.80 on revenue of $1.28 billion.

Economics

US GDP will be the star of Wednesday's economic calendar as investors wait to see whether or not the nation's growth picked up in the second quarter after difficult weather depressed the first quarter figures. Other notable economic releases include US oil inventory data, US services PMI, Italian consumer confidence, Spanish PPI, and Germany's GfK consumer climate data.

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

Tune into Benzinga’s #PreMarket Prep today to hear Kate Stalter, Greg Harmon and Martha Stokes by clicking here!

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

 

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