Benzinga Market Primer: Tuesday, April 30

Futures Flat on Mixed Economic Data

U.S. equity futures traded little changed in early pre-market trade following mixed global economic data. Mixed data out of Japan was followed by a flood of data out of Europe which continued to point to room for the European Central Bank to ease policy further on Thursday.

Top News

In other news around the markets:

• The Eurozone Unemployment Rate rose to 12.1 percent in March, in line with expectations and higher than February's reading of 12.0 percent. Spain already reported that unemployment climbed to a record last week while Germany reported overnight that its unemployment rate was flat at 6.9 percent in March and Italy's unemployment rate remained flat at 11.5 percent on expectations of a rise to 11.7 percent.


• Eurozone April CPI fell to a 1.3 percent annualized rate from 1.8 percent in March, well below the expected 1.8 percent rate, raising hopes that the ECB will cut rates as it has only a price stability mandate.


• Deutsche Bank DB announced that it was going to issue up to $6.5 billion in new stock as it reported a 19 percent rise in first quarter earnings to fill a capital shortfall. Earlier this year, S&P had warned that the bank would face a downgrade without more capital. Shares rose 5.52 percent pre-market on the news.


• S&P 500 futures were marginally lower at 1,587.30.


• The EUR/USD was lower at 1.3073.


• Spanish 10-year government bond yields fell 2 basis points to 4.14 percent.


• Italian 10-year government bond yields fell one basis point to 3.9 percent.


• Gold futures rose 0.14 percent to $1,469.40 per ounce.

Asian Markets

Asian shares were mixed overnight on a mixed bag of economic data out of Japan and Korea. The Japanese Nikkei Index fell 0.17 percent while the Shanghai Composite Index was closed and the Hang Seng Index rose 0.69 percent. Also, the Korean Kospi rose 1.2 percent and Australian shares rose 1.28 percent to the highest level since June of 2008.

European Markets

European shares were mostly modestly higher save for Italy and Germany which saw larger gains. The Spanish Ibex Index rose 0.05 percent and the Italian FTSE MIB Index rose 2.2 percent as Prime Minister Letta successfully formed a government. Meanwhile, the German DAX rose 0.84 percent while the French CAC 40 fell 0.01 percent and U.K. shares rose 0.1 percent.

Commodities

Commodities were slightly weaker overnight led lower by energy futures. WTI Crude futures declined 0.1 percent to $94.41 per barrel and Brent Crude futures fell 0.15 percent to $103.65 per barrel. Copper futures fell 0.09 percent to $322.35 per pound. Gold was higher and silver futures rose 0.47 percent to $24.28 per ounce.

Currencies

Currency markets were rather quiet overnight as the euro weakened slightly and the yen gained. The EUR/USD was lower at 1.3073 and the dollar fell against the yen to 97.55. Overall, the Dollar Index rose 0.03 percent on strength against the euro and the Swiss franc despite weakness against the yen, the Canadian dollar, and the pound.

Earnings Reported Yesterday

Key companies that reported earnings Monday include:

• Buffalo Wild Wings BWLD reported first quarter EPS of $0.87 vs. $0.99 on revenue of $304.4 million vs. $303.71 million.


• Herbalife HLF reported first quarter EPS of $1.27 vs. $1.07 on in-line revenue of $1.12 billion and raised guidance.
• Express Scripts Holdings ESRX reported first quarter EPS of $0.99 on revenue of $26.06 billion vs. $25.54 billion.

Pre-Market Movers

Stocks moving in the pre-market included:

• Deutsche Bank DB shares rose 5.52 percent pre-market despite the company announcing an additional $6.5 billion, or 16 percent of market cap, in new equity offerings on the heels of a strong first quarter earnings report.


• Best Buy BBY shares rose 1.28 percent on news that company is looking to sell 50 percent of its European operations for $775 million.


• PulteGroup PHM shares declined 0.57 percent pre-market ahead of the release of the S&P Case-Shiller Home Price Index and following the stronger than expected pending home sales data Monday in a move that appeared to be profit taking.


• BP BP shares rose 3.45 percent pre-market as the company reported first quarter EPS and declared its quarterly dividend.

Earnings

Notable companies expected to report earnings Tuesday include:

• 3D Systems DDD is expected to report first quarter EPS of $0.21 vs. $0.17 a year ago.


• Domino's Pizza DPZ is expected to report first quarter EPS of $0.55 vs. $0.47 a year ago.


• Marathon Petroleum Corp. MPC is expected to report first quarter EPS of $2.16 vs. $1.70 a year ago.


• Tenet Healthcare THC is expected to report first quarter EPS of $0.30 vs. $0.52 a year ago.


• TRW Holdings TRW is expected to report first quarter EPS of $1.43 vs. $1.62 a year ago.


• Valero Energy VLO is expected to report first quarter EPS of $0.98 vs. $0.31 a year ago.


• Vertex Pharmaceuticals VRTX is expected to report a first quarter loss of $0.19 per share vs. EPS of $0.43 a year ago.

Economics

On the economics calendar Monday, the FOMC meeting begins Tuesday. Data releases include the employment cost index, the Redbook, the S&P Case-Shiller Home Price Index, the Chicago PMI, and consumer confidence. Also, the Treasury is set to auction 4-week and 52-week bills. Overnight, Chinese and British manufacturing PMIs will be in focus.

Good luck and good trading.