Market Overview

#PreMarket Primer: Thursday, July 17: Russia Hit With New Sanctions

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Russia has been slapped with a new set of sanctions designed to economically isolate the nation as President Vladimir Putin has ignored calls from the U.S. and the EU to use Moscow’s influence to end the conflict in Ukraine.

The new round of sanctions steps up U.S. efforts to hurt the Russian economy by targeting businesses linked to the conflict rather than just individuals tied to Putin’s government. The sanctions affect big businesses including Rosneft, Russia’s largest oil producer, and Novatek, the nation’s second largest gas company.

Top News

In other news around the markets:

  • The deal between long time rivals Apple and IBM to sell iPads and iPhones to IBM’s business customers was a major blow to BlackBerry as it will likely take over much of the company’s customer base. Blackberry was slowly overcoming its troubled past this year and the company’s stock was up over 50 percent on Tuesday before news of the Apple-IBM agreement dimmed BlackBerry’s prospects.
  • Reuters reported that General Motors has found that the ignition switches responsible for turning off engines and airbags in some cars are safe in certain other models. A spokesperson for GM said there were several other design factors affecting the safety of the switches, making them dangerous only in some models.
  • The media space is rife with takeover deals and 21st Century Fox is getting in on the action. The company confirmed that it had attempted to acquire Time Warner Inc last week with an $80 billion cash and stock offer. Time Warner rejected the bid, but if Fox comes through with an offer sweet enough, it could help the company survive at a time when customers are likely to start cutting off their pay-TV subscriptions to opt for online versions.
  • General Electric is working to find a buyer for its appliance business as the company tries to shift its focus more towards more profitable products like heavy industrial equipment. CEO Jeff Immelt said he is looking to sell around $4 billion worth of assets each year to streamline GE’s profits.

Asian Markets

Asian markets were lower with the exception of South Korea’s KOSPI, which gained 0.37 percent. The NIKKEI lost 0.06 percent, the Shanghai composite was down 0.57 percent and the Shenzhen composite fell 0.60 percent.

European Markets

European markets began the day on a low note; the FTSE was down 0.34 percent, the STOXX 600 was down 0.42 percent, the DAX lost 0.35 percent, the CAC 40 was down 0.46 percent and the MIB fell 0.85 percent.

Commodities

Energy futures were higher; Brent futures were up 0.35 percent and WTI futures rose 0.87 percent. Gold and silver gained 0.37 percent and 0.43 percent, and industrial metals were also higher with the exception of tin, which lost 0.34 percent. Copper was up 0.03 percent, aluminum gained 0.51 percent and zinc rose 0.17 percent.

Currencies

The euro was steady at $1.3536, while the dollar declined 0.19 percent against the yen, 0.10 percent against the franc and 0.02 percent against the Canadian dollar. However, the greenback gained 0.14 percent against the pound.

Earnings

Notable earnings released on Wednesday included:

  • Bank of America (NYSE: BAC) reported second quarter EPS of $0.41 on revenue of $21.96 billion, compared to last year’s EPS of $0.32 on revenue of $22.73 billion.
  • eBay (NASDAQ: EBAY) reported second quarter EPS of $0.69 on revenue of $4.40 billion, compared to last year’s EPS of $0.63 on revenue of $3.88 billion.
  • Abbott Laboratories (NYSE: ABT) reported second quarter EPS of $0.54 on revenue of $5.55 billion, compared to last year’s EPS of $0.46 on revenue of $5.45 billion.
  • U.S. Bankcorp (NYSE: USB) reported second quarter EPS of $0.78, compared to last year’s EPS of $0.76 on revenue of $4.95 billion.
  • PNC Financial Services (NYSE: PNC) reported second quarter EPS of $1.85 on revenue of $3.81 billion, compared to last year’s EPS of $1.99 on revenue of $4.06 billion.

Pre-Market Movers

Stocks moving in the Premarket included:

  • Morgan Stanley (NYSE: MS) was up 0.74 percent in premarket trade after gaining 1.56 percent on Wednesday.
  • Apple (NASDAQ: AAPL) gained 0.12 percent in premarket trade after losing 0.57 percent on Wednesday.
  • SanDisk (NASDAQ: SNDK) was down 9.39 percent in premarket trade after climbing 2.43 percent over the past five days.
  • Micron Technology (NASDAQ: MU) fell 1.53 percent in premarket trade after gaining 5.32 percent over the past week.

Earnings

Notable earnings releases expected on Thursday include:

  • UnitedHealth Group (NYSE: UNH) is expected to report second quarter EPS of $1.26 on revenue of $31.98 billion, compared to last year’s EPS of $1.40 on revenue of $30.41 billion.
  • Novartis AG (NYSE: NVS) is expected to report second quarter EPS of $1.42 on revenue of $14.81 billion, compared to last year’s EPS of $1.28 on revenue of $14.49 billion.
  • Schlumberger N.V. (NYSE: SLB) is expected to report second quarter EPS of $1.36 on revenue of $11.92 billion, compared to last year’s EPS of $1.15 on revenue of $11.18 billion.
  • Morgan Stanley (NYSE: MS) is expected to report second quarter EPS of $0.58 on revenue of $8.39 billion, compared to last year’s EPS of $0.45 on revenue of $8.33 billion.
  • Philip Morris (NYSE: PM) is expected to report second quarter EPS of $1.24 on revenue of $7.52 billion, compared to last year’s EPS of $1.30 on revenue of $7.92 billion.

Economics

U.S. economic data will dominate Thursday’s economic calendar with releases including initial and continuing jobless claims, housing starts, building permits and FOMC member James Bullard is set to speak.

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

Tune into Benzinga’s #PreMarket Prep today to hear Fari Hamzei, Peter Tchir, Dirk Friczewsky & Riad Younes by clicking here!

Posted-In: Earnings News Guidance Eurozone Futures Commodities Previews Forex

 

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