Benzinga Market Primer: Monday, July 29: Futures Lower On Chinese Fears

Futures Lower On Chinese Fears

U.S. equity futures traded slightly lower in early pre-market trade after Asian shares on fears of a protracted slowdown in China. Data released over the weekend spooked investors and sent shares lower.

Top News

In other news around the markets:

• The National Bureau of Statistics in Beijing reported that industrial profits rose 6.3 percent in June from the June 2012, well below May's rate of 15.5 percent. The slowdown in growth partially reflects the liquidity crunch that hit the country in June.


• Japan's retail sales report for the month of June missed expectations sharply. Retail sales fell 0.2 percent in June from May compared to the expected gain of 0.8 percent.


• A poll out of Germany this weekend compiled by Enmid revealed that German Chancellor Angela Merkel may be losing her majority in the upcoming parliamentary elections. With elections in September a major risk event for the eurozone, Merkel's party slipped below the opposition in this poll, however accounting for errors in surveying, the data basically shows a dead heat.


• S&P 500 futures fell 2.5 points to 1,684.10.


• The EUR/USD was higher at 1.3288.


• Spanish 10-year government bond yields fell 1 basis point to 4.61 percent.


• Italian 10-year government bond yields fell 1 basis point to 4.39 percent.


• Gold rose 0.65 percent to $1,330.50 per ounce.

Asian Markets

Asian shares were mostly lower overnight on the back of the weak economic data rom China and Japan. The Japanese Nikkei 225 Index declined 3.32 percent and the Topix Index fell 2.61 percent. In Hong Kong, the Hang Seng Index declined 0.41 percent while the Shanghai Composite Index slipped 1.57 percent in China. Also, the Korean Kospi fell 0.57 percent and Australian shares shed 0.07 percent.

European Markets

European shares were mostly higher in early trade save for Germany following the poll results. The Spanish Ibex Index rose 0.86 percent while the Italian FTSE MIB Index fell 0.06 percent. Meanwhile, the German DAX declined 0.65 percent while the French CAC 40 Index gained 0.32 percent and U.K. shares rose 0.4 percent.

Commodities

Commodities were mixed overnight but had a negative tilt on growth fears out of China. WTI Crude futures fell 0.37 percent to $104.31 per barrel and Brent Crude futures fell 0.01 percent to $107.16 per barrel. Copper futures fell 0.27 percent to $309.70 per pound. Gold was higher and silver futures fell 0.03 percent to $19.77 per ounce.

Currencies

Currency markets were rather quiet overnight as the dollar weakened. The EUR/USD was higher at 1.3288 and the dollar fell against the yen to 97.88. Overall, the Dollar Index fell 0.14 percent on weakness against the yen, the pound, the euro, and the Swiss franc.

Earnings Reported Yesterday

Key companies that reported earnings Friday include:

• AbbVie ABBV reported second quarter EPS of $0.82 vs. $0.79 a year ago on revenue of $4.69 billion vs. $4.54 billion expected.


• Newmont Mining NEM reported second quarter EPS of $0.59 vs. $0.42 a year ago on revenue of $2.00 billion vs. $2.08 billion ayear ago.


• Stanley Black and Decker SWK reported second quarter EPS of $1.21 vs. $1.19 a year ago on revenue of $2.87 billion vs. $2.81 billion a year ago.
• Lear Corp. LEA reported second quarter EPS of $1.62 vs. $1.37 a year ago on revenue of $4.1 billion vs. $3.91 billion a year ago.

Pre-Market Movers

Stocks moving in the pre-market included:

• Perrigo PRGO shares rose 0.71 percent as Bloomberg reported that the company is close to a deal for Elan ELN. Elan rose 10.65 percent pre-market.


• Saks SKS shares rose 4.83 percent pre-market as the New York Post reported that Lord and Taylor Owner Hudson's Bay Co. is set to buy the company for between $17-18 per share.

Earnings

Notable companies expected to report earnings Monday include:

• Express Scripts Holdings ESRX is expected tp report second quarter EPS of $1.10 vs. $0.88 a year ago on revenue of $25.52 billion vs. $27.69 billion a year ago.


• Anadarko Petroleum APC is expected to report second quarter EPS of $0.91 vs. $0.85 a year ago on revenue of $3.57 billion vs. $3.22 billion a year ago.


• Caesars Entertainment CZR is expected to report a second quarter loss of $1.57 vs. a loss of $1.93 a year ago on revenue of $2.18 billion vs. $2.17 billion a year ago.


• Simon Property Group SPG is expected to report second quarter EPS of $2.07 vs. $1.89 a year ago on revenue of $1.24 billion vs. $1.19 billion a year ago.


• Herbalife HLF is expected to report second quarter EPS of $1.18 vs. $1.10 a year ago on revenue of $1.16 billion vs. $1.03 billion a year ago.

Economics

On the economics calendar Monday, pending home sales are due out ahead of the Dallas Fed Manufacturing Survey and the weekly 3- and 6-month bill auctions. Overnight, RBA Governor Glenn Stevens is set to speak and the Spanish GDP report is due out.

Good luck and good trading.

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

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