Benzinga Market Primer, Tuesday August 7

U.S. equity futures continued a steady march higher early Tuesday as Royal Bank of Australia Governor Glenn Stevens made positive comments on the U.S. economy, citing most global weakness stems from Asia. Futures rose in the U.S. despite weak italian economic data including industrial production and GDP. Italian industrial production fell 1.4 percent in July and GDP fell 0.7 percent in the second quarter, a 2.5 percent annualized rate of contraction.

In other news around the markets:

• British industrial production beat economists forecasts of a 3.4 percent contraction in July printing at a 2.5 percent contraction in July.


• German factory orders plummeted 1.7 percent in July, much worse than economist forecast of a 1.0 percent drop and also much slower than June's 0.7 percent rise.


• Standard Chartered Bank has been caught in a controversy of secretly funneling money into Iran, however the bank denies the allegations. The New York State banking regulator threatens to pull the bank's banking license, however Standard Chartered does some 90 percent of its business in the Middle East, Africa and Asia.


• Bill Gross of PIMCO warns investors to avoid Europe at all costs.


• S&P 500 futures rose 2 points to 1391.90.


• EUR/USD rose to 1.2402.


• Gold fell to $1,616.10 per ounce, down $0.10.


• Spanish 10-year yields rose to 6.817 percent, Italian 10-year yields fell to 5.986 percent.

Asian banks were mostly strong overnight with a majority of regional indexes rising. The Japanese Nikkei rose 0.88 percent despite a trading a glitch on the Tokyo Stock Exchange that halted trading for more than two hours. Chinese shares measured by the Shanghai Composite Index rose 0.13 percent and shares in Hong Kong rose 0.37 percent. European shares were less enthusiastic in early trading as Spanish and Italian shares fell. Spain's Ibex 35 Index fell 0.25 percent following a day in which shares rose despite trading being halted for over five hours following a trading glitch. Italy's MIB Index fell 0.39 percent and German shares rose very modestly.

Energy prices continued to rally early Tuesday following Monday's spike in oil prices on reports that Syrian President Bashaar al-Assad had been killed while fighting. WTI Crude futures rose 0.04 percent to $92.24 and Brent Crude futures rose 0.52 percent to $110.12 per barrel. Copper futures rose 0.46 percent to $340.45 per pound on the positive comments from RBA Governor Glenn Stevens, as Australia is one of the world's largest exporters of copper. Silver futures also rose and gold remained effectively flat.

The dollar index fell in early trading by 0.15 percent to 82.14 as the euro continued to gain against the greenback and the Aussie dollar continued its strength of late. The AUD/USD rose 0.2 percent to 1.0587 and the EUR/AUD fell 0.05 percent to 1.1723. The EUR/CHF recovered back to levels it has traded around recently after a a fat finger trade sent the pair spiking for a short period of time, only for it to quickly retreat.

Chesapeake Energy CHK posted 2Q earnings that missed analysts estimates but posted revenue that beat estimates. The report was a break from the notable trend of companies missing estimates largely on the revenue side. Tuesday, 286 companies are expected to post earnings and notable ones include:

• Amylin Pharmaceuticals AMLN is expected to post a Q2 loss of $0.45 per shares as compared to a loss in the same period last year of $0.22.


• Express Scripps ESRX is expected to report Q2 EPS of $0.82 vs. $0.71 a year ago.


• Molson Coors TAP is expected to report Q2 EPS of $1.19 vs. $1.23 a year ago.


• Sirius XM Radio SIRI is expected to report Q2 EPS of $0.20 vs. $0.30 a year ago.

Today's economic calendar includes same store sales and the Redbook. Also, consumer credit data is due out and Chairman Ben Bernanke is set to continue his educational tour of making the Fed more transparent.

Good luck and good trading.