Minyanville's Before The Bell: BP Says Revenues 'Dreadful'; Futures Point Lower
BP says earnings will be dreadful. Deutsche Bank falls for another day. Target revises lower. Markets succomb!
Asian markets ended mixed. Japan's Nikkei gained +0.55% on its first day back from a holiday. Economic data released today did not do much to help the sentiment, however. Japan's August supermarket sales came in down -0.5% vs. -2.8% a month ago. August corporate service prices data was also released (prices companies pay for services such as rents and transportation) climbing 1% in August from a year earlier, the slowest pace in five months (From Bloomberg)
In other parts, India's Sensex gained +0.32%, Hong Kong's Hang Seng fell -0.64%, and China's Shanghai Composite lost -1.08%. Other markets were closed for various holidays.
Across the sea, the picture in Europe is not looking so bright. The CAC is lower by -1.11%, DAX is lower by -0.67%, and the FTSE is down by -1.15%.
European markets received a surprise as BP (BP) CEO Tony Hayward announced 3Q revenues will be "dreadful." BP, Europe's second-largest oil company, also announced staff cuts and a reorganization due to its worst financial performance in 15 years. Shares of the company slid as much as 3% in overseas trading. (From Bloomberg)
Financials are also adding to the downside pressure. Deutsche Bank (DB) continued to lose another 2% a day after Reuters reported the bank would take a $2.4 bln hit due to markdowns on loans. In addition, Merrill Lynch (MER) analysts released a note this morning that they remain cautious on the European banking sector due to macroeconomic concerns. (From WSJ) Please read Minyan Peter's article from earlier this month on Why Europe matters more. In addition, catch his latest piece for his sector update, Financial Services Highlights: The Race Is On.
Further, European Central Bank council member Nicholas Garganas was on the tape reiterating the central bank's number one concern was inflation. In an interview late yesterday Garganas said, "upside risks to inflation dominate any effects stemming from the appreciation of the euro." His statements come as the euro hit an all-time high against the dollar. Please read Professor Zucchi's Testing The Dollar With Four Primary Metrics for more of an understanding of the dollar's weakness.
In the U.S. retailers should be seeing some pressure. Target (TGT) cut its forecast for September same-store sales. The revision calls for an SSS increase of 1.5-2.5% from a previous forecast of 4-6%. (From Cantor) Lowe's (LOW) also added that sales are trending below previous expectations. The company revised its guidance lower due to drought conditions around the country. The company now expects to earn on the low end or slightly below its prior guidance at $1.97 to $2.01 vs. $1.99 cons. (From Briefing.com) Be sure to stay with us on the Buzz as our retail specialist Professor Macke is sure to chime in with his thoughts.
Crude is trading lower by $0.92 to $80.01 and Gold is also lower by $8.70 to $730.6 this morning.
Click here for our Stocks to Watch and Check on our News & Views page for more company-specific ideas.
On the radar today, investors will be closely watching Existing Home Sales data set to be released at 10:00 AM EST. The consensus calls for sales of existing homes to come in at a seasonally adjusted annual rate of 5.55 mln. Consumer Confidence will also be closely monitored. That data is also schedule to be release at 10:00 AM EST with a consensus figure of 104.5. Please click here for the full trading radar.
It's Tuesday Minyans. Although we're bummed that the Saints lost their mojo, we hope to make a little mojo for our own. Keep checking back with continuously-updated information you need to know. Good luck and good trading!
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.
Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
Daily Recap Newsletter