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T3's Take 3: Global Markets Rally and Apple Rolls, but Disney Has No Magic


Today's financial recap and tomorrow's financial outlook.

Today on T3 Live

Daily Market Report author Jeff Cooper initiated a long swing on Facebook (FB) as the stock opened on a gap this morning with a pullback. He currently has a 2-point profit target for the first piece of the trade.

Click here to learn more about the Daily Market Report

World Equity Markets

US markets rallied despite softer-than-expected economic data. The ADP employment change rose by 185K vs. the expected 215K, leading investors to think that the Fed may hold off on raising rates. The US trade balance also came short of expectations at $43.8 billion. However, the ISM services index surged to a 10-year high last month.

The S&P 500 fionished up 0.3%.

Most Asian markets rallied, with Japan's Nikkei finishing up 0.5% on gains in the construction sector. Hong Kong's Hang Seng rose 0.44%, while the Shanghai Composite was a different story as it 1.6% despite a strong services PMI number.

European markets rallied on a rebound in the commodities sector. France and Italy led the way as the CAC and MIB closed up 1.7% and 1.9%, respectively. European bond yields saw a jump as investors moved money into equities.

Rolling Apples

(AAPL) shares fell at the open after the stock was downgraded by Bank of America Merrill Lynch (BAC). Bank of America expects a slowdown in revenue growth from iPhone, uncertainty in China, and low expectations for capital return announcements.

Global Equities also cut its numbers for Apple based on the China's economic outlook. Analyst Trip Chowdhry stated that China's GDP is declining to a -2% rate from current 5%-7% growth growth, similar to the US decline in 2008. He compared what happened to company's like Starbucks (SBUX) as a proxy for Apple.

However, Apple shares posted a $5+ intraday rally and finished up 0.7%. That helped the NASDAQ outperform with a 0.7% gain.

No Disney Magic

Disney (DIS) shares had their worst day of the year, closing down 9.2%. The company missed Wall Street's revenue expectations by about $100 million, breaking a seven-quarter streak of positive surprises. Many are looking towards its TV business, mainly ESPN, as viewership habits among consumers are changing.

ESPN charges a $6 monthly subscription fee for its services. However it was reported that the service shed about 4.3% of its subscribers between 2012 and 2014.

Disney shares are still up about 17% for 2015.

Thursday's Financial Outlook

US economic data for tomorrow will include Challenger job cuts, Initial and Continuing claims, Bloomberg consumer confort, and EIA gas reports.

Overseas economic data will include Swiss SECO consumer confidence, German factory orders, Markit German construction PMI, Markit Germany & Euro-zone retail PMI, and British industrial production. Also, the Bank of England will announce its rate decision and asset purchase target, and the Bank of Japan will make its own policy statement.

Allergan (AGN), Apache (APA), Manulife Financial (MFC), and Viacom (VIAB) will announce earnings before the open.

Con Edison (ED), EOG Resources (EOG), Mohawk (MHK), and NVIDIA (NVDA) will release their earnings after the close.
No positions in stocks mentioned.
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