Market Overview

Benzinga Market Primer: Monday, February 25

Benzinga Market Primer: Monday, February 25

Futures Rise Despite U.K. Downgrade, Weak China Manufacturing Data

U.S. equity futures rose slightly in pre-market trading despite the downgrade of the U.K.'s sovereign credit rating to Aa1 from AAA by Moody's. Also, the China HSBC Flash Manufacturing PMI for February was released at 50.4, weaker than expectations of 52.2 and below the previous reading of 52.3.

Top News

In other news around the markets:

  • Japan has nominated Asian Development Bank Chief Haruhiko Kuroda to be the next Bank of Japan Governor, with another candidate, Kukuo Iwata, was nominated as a Deputy Governor.
  • The Bank of Greece sees the Greek economy contracting 4.5 percent in 2013 with growth finally returning in 2014.
  • Italy auctioned 2-year zero-coupon bonds to yield 1.682 percent, higher than the previous auction just hours before the initial results of the critical parliamentary elections are released.
  • S&P 500 futures rose 2.9 points to 1,517.50.
  • The EUR/USD was higher at 1.3258.
  • Spanish 10-year government bond yields rose to 5.16 percent.
  • Italian 10-year government bond yields rose to 4.45 percent.
  • Gold rose 1.13 percent to $1,590.50 per ounce.

Asian Markets

Asian shares were mostly higher overnight led by Japanese shares following the Bank of Japan nominations. The Japanese Nikkei Index rose 2.43 percent and the Shanghai Composite Index rose 0.5 percent while the Hang Seng Index rose 0.17 percent. Also, the Korean Kospi fell 0.46 percent and Australian shares rose 0.75 percent.

European Markets

European shares were higher overnight ahead of the Italian election results. The Spanish Ibex Index rose 0.68 percent and the Italian FTSE MIB Index rose 0.85 percent. Meanwhile, the German DAX rose 1.29 percent and the French CAC rose 0.66 percent while U.K. shares rose 0.46 percent.


Commodities were stronger overnight after last week's massive weakness despite the weaker than expected China data. WTI Crude futures rose 0.75 percent to $93.83 per barrel and Brent Crude futures rose 0.91 percent to $115.14 per barrel. Copper futures rose 0.37 percent to $356.35 as mining stocks rallied. Gold was higher and silver futures rose 2.03 percent to $29.10 per ounce.


Currency markets were in flux overnight as the euro strengthened, the pound weakened and the yen continued its slide. The EUR/USD was higher at 1.3258 and the dollar rose against the yen to 93.87 and the cable fell to 1.5146. Overall, the Dollar Index fell 0.23 percent on weakness against the euro and the swiss franc. Also, the AUD/USD was weaker following the Chinese manufacturing data and the EUR/GBP rose 0.62 percent following the U.K. downgrade while the EUR/JPY rose 0.99 percent.

Pre-Market Movers

Stocks moving in the pre-market included:

  • Chesapeake Energy (NYSE: CHK) shares rose 1.95 percent pre-market as the company reported strong earnings last week and is expected to name a new CEO soon.
  • Newmont Mining (NYSE: NEM) shares rose 1.47 percent pre-market after reporting strong earnings last week and positive comments in this weekend's Barron's.
  • Carnival Corporation (NYSE: CCL) shares fell 0.97 percent pre-market as passengers of the Triumph, the ship that broke down at sea and filled with sewage, are launching a class action lawsuit against the company.
  • ADT Corp (NYSE: ADT) shares rose 1.11 percent after Barron's said the shares could rise 20 percent in the next year.


Notable companies expected to report earnings Monday include:

  • Autodesk (NASDAQ: ADSK) is expected to report fourth quarter EPS of $0.49 vs. $0.46 a year ago.
  • Big Lots (NYSE: BIG) is expected to report fourth quarter EPS of $1.99 vs. $1.75 a year ago.
  • Three-D Systems (NYSE: DDD) is expected to report fourth quarter EPS of $0.38 vs. $0.16 a year ago.
  • Vivus (NASDAQ: VVUS) is expected to report a fourth quarter loss of $0.44 per share vs. a loss of $0.14 per share a year ago.


On the economics calendar Monday, the Chicago Fed National Activity Index and the Dallas Fed Manufacturing Survey are due out. Also, the Treasury is set to auction 3- and 6-month bills as well as 2-year notes. Lastly, the Fed's Dennis Lockhart is expected to speak. In Europe, look for Italian exit polls to leak out approximately one hour after polls close at 9 am eastern. Overnight, look for clearer Italian election results as well as an Italian 6-month bill auction.

Good luck and good trading.

Posted-In: Earnings News Bonds Guidance Dividends Downgrades Futures Commodities Best of Benzinga


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