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Utilities Stocks Remain Weak; Russia Headlines Continue to Dominate Trading
Today's financial recap and tomorrow's financial outlook.
Minyanville Staff    

Poland's Prime Minister increased its rhetoric on Russia's continued buildup of military forces on the Ukraine border. He suggested that Russia is planning to invade under the guise of a peacekeeping mission to prevent further humanitarian violations, or at least pressure Ukraine's government into ceasing its offensive in the eastern part of the country. This kept European equities weak overnight and by extension, the US.

Also early this morning, Italy's preliminary report of second quarter GDP showed a second quarter of recession. Growth fell 0.2% in the quarter after dropping 0.1% in the previous period. Italy's FTSEMIB was the second worst performing index in Europe today, behind Portugal. Additionally, German factory orders fell the most in two and a half years in June, declining 3.2%.

Two major M&A deals were withdrawn last night, which caused a significant amount of negative movement in their respective stocks. Sprint (S) withdrew its intent to buy T-Mobile (TMUS) due to regulatory reasons. 21st Century Fox (FOX) withdrew its bid for Time Warner (TWX) because its board was not responsive to any deal. In both cases, the stocks in question were down significantly, erasing the substantial gains from when the bids were originally announced.

A sizable trade in the foreign exchange shook equity markets in the afternoon. The USD plummeted by more than 20bps (a substantial move, intraday) on volume in Yen futures that was more than a full day's average trading. Amongst other things, a fat finger error trade was cited as the catalyst behind this trade. Only major currencies such as the euro, pound, yen, and aussie were affected. Emerging market currency pairs were unmoved during the trade. Following the trade and subsequent currency movements, US equity indices began to roll over and finished the day back near flat.

By the end of the day, the S&P 500 (SPX) finished exactly unchanged after a volatile session in both directions. Utilities stocks continued to struggle for the seventh straight day and are now down 3% for the week. Consumer staples, a defensive sector, was the top performer today.

Tomorrow's Financial Outlook

In the US, weekly jobless claims will be reported tomorrow morning. Economists are expecting claims to trend back up to 305K after the past two weeks likely included temporary distortions from auto manufacturing shutdowns. The other economic report scheduled for tomorrow is June consumer credit, expected to expand at an annualized rate of $18.25 billion.

The main focus for overnight risk markets and much of tomorrow's trading will be the ECB rate decision, scheduled for 7:45 a.m. ET tomorrow morning. It is unlikely, given media reports, that the ECB is ready to take any further substantial action, but it is likely that it continues to keep a dovish tone. President Draghi will hold his usual press conference at 8:30 a.m. where market participants will be able to glean the most information. The other event of note is the Bank of England's rate decision, which for the first time may include a dissent on keeping rates unchanged at 0.5%, as two Monetary Policy Committee members have become much more vocally hawkish. This change may not be revealed until the minutes are released in two weeks.

More than 40 major US companies are scheduled to report earnings tomorrow. Notable reports include Cooper Tire (CTB), Wendy's (WEN), Duke Energy (DUKW), Goodrich Petroleum (GDP), Nvidia (NVDA), CBS (CBS), Lions Gate (LGF), Monster Beverages (MNST), Medivation (MDVN), and Zynga (ZNGA).

Twitter: @Minyanville

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
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No positions in stocks mentioned.

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.

Utilities Stocks Remain Weak; Russia Headlines Continue to Dominate Trading
Today's financial recap and tomorrow's financial outlook.
Minyanville Staff    

Poland's Prime Minister increased its rhetoric on Russia's continued buildup of military forces on the Ukraine border. He suggested that Russia is planning to invade under the guise of a peacekeeping mission to prevent further humanitarian violations, or at least pressure Ukraine's government into ceasing its offensive in the eastern part of the country. This kept European equities weak overnight and by extension, the US.

Also early this morning, Italy's preliminary report of second quarter GDP showed a second quarter of recession. Growth fell 0.2% in the quarter after dropping 0.1% in the previous period. Italy's FTSEMIB was the second worst performing index in Europe today, behind Portugal. Additionally, German factory orders fell the most in two and a half years in June, declining 3.2%.

Two major M&A deals were withdrawn last night, which caused a significant amount of negative movement in their respective stocks. Sprint (S) withdrew its intent to buy T-Mobile (TMUS) due to regulatory reasons. 21st Century Fox (FOX) withdrew its bid for Time Warner (TWX) because its board was not responsive to any deal. In both cases, the stocks in question were down significantly, erasing the substantial gains from when the bids were originally announced.

A sizable trade in the foreign exchange shook equity markets in the afternoon. The USD plummeted by more than 20bps (a substantial move, intraday) on volume in Yen futures that was more than a full day's average trading. Amongst other things, a fat finger error trade was cited as the catalyst behind this trade. Only major currencies such as the euro, pound, yen, and aussie were affected. Emerging market currency pairs were unmoved during the trade. Following the trade and subsequent currency movements, US equity indices began to roll over and finished the day back near flat.

By the end of the day, the S&P 500 (SPX) finished exactly unchanged after a volatile session in both directions. Utilities stocks continued to struggle for the seventh straight day and are now down 3% for the week. Consumer staples, a defensive sector, was the top performer today.

Tomorrow's Financial Outlook

In the US, weekly jobless claims will be reported tomorrow morning. Economists are expecting claims to trend back up to 305K after the past two weeks likely included temporary distortions from auto manufacturing shutdowns. The other economic report scheduled for tomorrow is June consumer credit, expected to expand at an annualized rate of $18.25 billion.

The main focus for overnight risk markets and much of tomorrow's trading will be the ECB rate decision, scheduled for 7:45 a.m. ET tomorrow morning. It is unlikely, given media reports, that the ECB is ready to take any further substantial action, but it is likely that it continues to keep a dovish tone. President Draghi will hold his usual press conference at 8:30 a.m. where market participants will be able to glean the most information. The other event of note is the Bank of England's rate decision, which for the first time may include a dissent on keeping rates unchanged at 0.5%, as two Monetary Policy Committee members have become much more vocally hawkish. This change may not be revealed until the minutes are released in two weeks.

More than 40 major US companies are scheduled to report earnings tomorrow. Notable reports include Cooper Tire (CTB), Wendy's (WEN), Duke Energy (DUKW), Goodrich Petroleum (GDP), Nvidia (NVDA), CBS (CBS), Lions Gate (LGF), Monster Beverages (MNST), Medivation (MDVN), and Zynga (ZNGA).

Twitter: @Minyanville

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
< Previous
  • 1
Next >
No positions in stocks mentioned.

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.

More From Minyanville Staff
Daily Recap
Utilities Stocks Remain Weak; Russia Headlines Continue to Dominate Trading
Today's financial recap and tomorrow's financial outlook.
Minyanville Staff    

Poland's Prime Minister increased its rhetoric on Russia's continued buildup of military forces on the Ukraine border. He suggested that Russia is planning to invade under the guise of a peacekeeping mission to prevent further humanitarian violations, or at least pressure Ukraine's government into ceasing its offensive in the eastern part of the country. This kept European equities weak overnight and by extension, the US.

Also early this morning, Italy's preliminary report of second quarter GDP showed a second quarter of recession. Growth fell 0.2% in the quarter after dropping 0.1% in the previous period. Italy's FTSEMIB was the second worst performing index in Europe today, behind Portugal. Additionally, German factory orders fell the most in two and a half years in June, declining 3.2%.

Two major M&A deals were withdrawn last night, which caused a significant amount of negative movement in their respective stocks. Sprint (S) withdrew its intent to buy T-Mobile (TMUS) due to regulatory reasons. 21st Century Fox (FOX) withdrew its bid for Time Warner (TWX) because its board was not responsive to any deal. In both cases, the stocks in question were down significantly, erasing the substantial gains from when the bids were originally announced.

A sizable trade in the foreign exchange shook equity markets in the afternoon. The USD plummeted by more than 20bps (a substantial move, intraday) on volume in Yen futures that was more than a full day's average trading. Amongst other things, a fat finger error trade was cited as the catalyst behind this trade. Only major currencies such as the euro, pound, yen, and aussie were affected. Emerging market currency pairs were unmoved during the trade. Following the trade and subsequent currency movements, US equity indices began to roll over and finished the day back near flat.

By the end of the day, the S&P 500 (SPX) finished exactly unchanged after a volatile session in both directions. Utilities stocks continued to struggle for the seventh straight day and are now down 3% for the week. Consumer staples, a defensive sector, was the top performer today.

Tomorrow's Financial Outlook

In the US, weekly jobless claims will be reported tomorrow morning. Economists are expecting claims to trend back up to 305K after the past two weeks likely included temporary distortions from auto manufacturing shutdowns. The other economic report scheduled for tomorrow is June consumer credit, expected to expand at an annualized rate of $18.25 billion.

The main focus for overnight risk markets and much of tomorrow's trading will be the ECB rate decision, scheduled for 7:45 a.m. ET tomorrow morning. It is unlikely, given media reports, that the ECB is ready to take any further substantial action, but it is likely that it continues to keep a dovish tone. President Draghi will hold his usual press conference at 8:30 a.m. where market participants will be able to glean the most information. The other event of note is the Bank of England's rate decision, which for the first time may include a dissent on keeping rates unchanged at 0.5%, as two Monetary Policy Committee members have become much more vocally hawkish. This change may not be revealed until the minutes are released in two weeks.

More than 40 major US companies are scheduled to report earnings tomorrow. Notable reports include Cooper Tire (CTB), Wendy's (WEN), Duke Energy (DUKW), Goodrich Petroleum (GDP), Nvidia (NVDA), CBS (CBS), Lions Gate (LGF), Monster Beverages (MNST), Medivation (MDVN), and Zynga (ZNGA).

Twitter: @Minyanville

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
< Previous
  • 1
Next >
No positions in stocks mentioned.

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.

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