TradeTheNews.com US Market Update

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Share This Story: | | Email Thursday, March 08, 2012 11:20:24 AM

 TradeTheNews.com US Market Update

DJIA +58 S&P500 +8.5 NASDAQ +27

***Economic Data***
- (UK) Bank of England (BOE) left Interest Rate unchanged at 0.50%; Maintain Asset Purchase Target unchanged at £325B, both as expected
- (US) Feb Challenger Job Cuts: 51.7K v 53.5K prior; Y/Y: 2.0% v 38.9% prior
- (EU) ECB leaves Interest Rate unchanged at 1.00%; as expected
- (US) March RBC Consumer Outlook Index: 47.5 v 45.1 prior
- (CA) Canada Feb Housing Starts: 201.1K v 200Ke
- (CA) Canada Jan New Housing Price Index M/M: 0.1% v 0.1%e; Y/Y: 2.4% v 2.5%e
- (US) Initial Jobless Claims: 362K v 351ke; Continuing Claims: 3.416M v 3.40Me
- (CA) Bank of Canada (BOC)left Interest Rate unchanged at 1.00%, as expected
- (MX) Mexico Feb Consumer Prices M/M: 0.2% v 0.3%e; Y/Y: 3.9% v 4.0%e; CPI Core M/M: 0.4% v 0.5%e
- (BR) Brazil Jan CNI Capacity Utilization: 81.9% v 81.7%e
- 10:30 (US) Weekly EIA Natural Gas Inventories: -80 bcf v -82 bcf to -87 bcf expected range

- The S&P500 and Nasdaq are racking up steady gains this morning, with the Greek debt exchange apparently headed for success. The most recent headlines suggest that the participation rate has topped the key 75% level, further bolstering gains. Note that the DJIA is underperforming thanks to McDonalds weak showing in its February sales comps. At the rate decision press conference this morning, the ECB warned that it would miss its inflation target for this year. President Draghi said that higher-than-expected energy prices and other costs meant that "inflation is expected to remain above 2% in 2012, with upside risks prevailing." There has been speculation that the February non-farm payroll data was leaked ahead of Friday's report. Rumors say the number is around 220K, which would be slightly better than the current consensus estimates.

- McDonald's shares slid 3% after posting February same-store sales growth of 7.5%, falling short of analyst expectations. McDonald's said first quarter income could be pinched by Europe's economic woes in addition to costs for commodities and labor. Navistar's loss widened markedly in the company's first quarter, as results were dragged down by higher costs. Note that Navistar cut its earnings outlook for FY12, but sustained its revenue guidance. The US Treasury unloaded another batch of AIG stock this morning, selling about $6 billion in shares - $3 billion of which were repurchased by AIG. This cuts the government's stake to 77% of the insurer's common shares.

- Shares of solar names Jinko and Suntech Power were down 4% and 12% respectively at the open of trading this morning. Jinko's margins collapsed in its Q4, driving a massive loss. Suntech Power's quarterly loss was twice the expected amount, and it expects shipments in the first quarter of 2012 to decline by approximately 30% y/y. However after the open, vague reports made the rounds that the German ruling party would like to delay solar incentive cuts to 2014, lifting the sector. JKS has retraced to about -6%, while JKS and other major solar names are in the black.

- There were few surprises in the central bank rate decisions at the BoE, ECB and Bank of Canada, all of which left rates unchanged. The euro has continued to strengthen this morning, and EUR/USD touched one-week highs around 1.3280 mid morning following the ECB press conference. ECB Chief Draghi said that inflation would remain above the bank's 2.0% target longer than previously expected, into early 2013. The Greek PSI debt swap participation deadline is at 15:00ET this afternoon, and the Greek government is expected to announce the results in the small hours of Friday morning, at 01:00ET.

***Looking Ahead***
- 12:00 (DE) Germany Fin Min Schaeuble attends podium on Theme of Europe: Berlin
- 15:00 (GR) Deadline for bond holders to participate in Greece PSI debt swap
- 16:00 (KR) South Korea Feb Producer Price Index Y/Y: No est v 3.4% prior
- 18:00 (PE) Peru Central Bank Interest Rate Decision: Expected to leave the Reference Rate unchanged at 4.25%
- 20:30 (CN) China Feb Producer Price Index Y/Y: 0.1%e v 0.7% prior
- 20:30 (CN) China Feb Consumer Price Index Y/Y: 3.4%e v 4.5% prior  

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