Benzinga Market Primer: Thursday, July 18: Key Tech Earnings Today!

Futures Little Changed Ahead of Bernanke, Key Tech Earnings

U.S. equity futures nearly unchanged ahead of some key earnings Thursday as well the second day of Congressional testimony from Federal Reserve Chairman Ben Bernanke.

Earnings from Verizon VZ, Google GOOG, and Microsoft MSFT will be of note today.

Top News

In other news around the markets:

• British retail sales rose in line with estimate in June, gaining 0.2 percent in the month. However, the year-over-year figure was strong, showing 2.1 percent growth vs. an expected gain of 1.7 percent while May's year over year figure was revised higher to show 2.1 percent growth vs. the previous estimate of 1.9 percent.


• Overnight, software giant SAP SAP reported weak second quarter revenues and blamed the miss on slowing Chinese growth. The news could foretell weakness for other software firms.


• Chinese home prices rose 6.6 percent from a year ago in the 69 major cities, better than May's rise of 6.1 percent.


• S&P 500 futures rose 0.7 points to 1,676.30.


• The EUR/USD was lower at 1.3115.


• Spanish 10-year government bond yields were flat at 4.73 percent.


• Italian 10-year government bond yields rose 1 basis point to 4.5 percent.


• Gold rose 0.2 percent to $1,281.40 per ounce.

Asian Markets

Asian shares were mixed overnight as Japanese shares gained while Chinese shares lagged following some negative comments from the IMF yesterday. The Japanese Nikkei 225 Index rose 1.32 percent and the Topix Index gained 0.72 percent. In Hong Kong, the Hang Seng Index fell 0.12 percent and the Shanghai Composite Index fell 1.05 percent in China. Also, the Korean Kospi fell 0.64 percent and Australian shares gained 0.24 percent.

European Markets

European shares were mostly higher in early trade following the positive British retail sales data and bond auctions from France and Spain. The Spanish Ibex Index rose 0.73 percent and the Italian FTSE MIB Index gained 0.63 percent. Meanwhile, the German DAX declined 0.07 percent and the French CAC 40 Index rose 0.27 percent while U.K. shares added 0.36 percent.

Commodities

Commodities were lower overnight save for gold on China fears. WTI Crude futures declined 0.13 percent to $106.34 per barrel and Brent Crude futures fell 0.28 percent to $108.31 per barrel. Copper futures fell 0.08 percent to $312.60 per pound. Gold was higher and silver futures fell 0.08 percent to $19.41 per ounce.

Currencies

Currency markets were on the move as the USD/JPY crossed back above 100. The EUR/USD was lower at 1.3115 and the dollar rose against the yen to 100.12. Overall, the Dollar Index gained 0.1 percent on strength against the yen, the Swiss franc, the Canadian dollar, the pound, and the euro.

Earnings Reported Yesterday

Key companies that reported earnings Wednesday include:

• IBM IBM reported second quarter EPS of $3.91 vs. $3.77 expected on revenue of $24.9 billion vs. $25.36 billion expected. The company sees full year EPS at $16.90 vs. the $16.70 estimate.


• Bank of America BAC reported second quarter EPS of $0.32 vs. $0.25 expected on revenue of $22.9 billion vs. $22.79 billion expected.


• Intel INTC reported second quarter EPS of $0.39, in line, on revenue of $12.8 billion vs. $12.89 billion expected and guided sales for the full year to the lower end of the previous guidance.
• American Express AXP reported second quarter EPS of $1.27 vs. $1.22 expected on revenue of $8.24 billion vs. $8.3 billion expected.


• eBay EBAY reported second quarter EPS of $0.63 vs. $0.64 expected on revenue of $3.87 billion vs. $3.89 billion expected and lowered second quarter guidance.


• Sandisk SNDK reported second quarter EPS of $1.21 vs. $0.92 expected on revenue of $1.48 billion vs. $1.4 billion expected and posted strong revenue guidance for the next quarter and the full year.

Pre-Market Movers

Stocks moving in the pre-market included:

• IBM IBM shares rose 2.6 percent pre-market after posting earnings and some strong EPS guidance.


• Intel INTC shares declined 3.15 percent pre-market on the weak Q2 results and the weak revenue guidance.


• eBay EBAY shares dropped 6.71 percent pre-market following weak earnings and lowered guidance.


• Sandisk SNDK shares rose 5.99 percent pre-market after the company reported a strong second quarter and strong guidance after the bell.

Earnings

Notable companies expected to report earnings Thursday include:

• UnitedHealth Group UNH is expected to report second quarter EPS of $1.25 vs. $1.27 a year ago on revenue of $30.5 billion vs. $27.26 billion a year ago.


• Verizon VZ is expected to report second quarter EPS of $0.73 vs. $0.64 a year ago on revenue of $29.82 billion vs. $28.55 billion a year ago.


• Microsoft MSFT is expected to report fourth quarter EPS of $0.75 vs. $0.67 a year ago on revenue of $20.79 billion vs. $18.06 billion a year ago.


• Google GOOG is expected to report second quarter EPS of $10.79 vs. $10.12 a year ago on revenue of $14.42 billion vs. $9.61 billion a year ago.


• Johnson Controls JCI is expected to report third quarter EPS of $0.75 vs. $0.64 a year ago on revenue of $10.99 billion vs. $10.58 billion a year ago.


• Union Pacific UNP is expected to report second quarter EPS of $2.35 vs. $2.10 a year ago on revenue of $5.5 billion vs. $5.22 billion a year ago.

Economics

On the economics calendar Thursday, initial jobless claims, the Philly Fed Survey, and leading indicators are due out ahead of Ben Bernanke's testimony on Capitol Hill.

Good luck and good trading.

Tune into Benzinga's PreMarket Info show with Dennis Dick and Joel Elconin here.

For a recap of Wednesday's market action, read Benzinga's daily market wrap here.