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Last updateFri, 22 Nov 2013 4am

Back You are here: Home Markets Markets Update US Commentary Wall Street Persists With Feeble Optimism

Stocks Update

Wall Street appears to be persisting with its feeble optimism, as indicated by the U.S. index futures, which point to a slightly higher opening on Friday.

Despite the pitfall of the Congressional deal that only postpones risks by a couple of months, traders are still hopeful that global economic recovery is on a firm footing. Supporting the expectations, China reported third quarter GDP data, which showed a faster rate of expansion.

Earnings news may also render direction to the markets, with the earnings released after the close of trading on Thursday being mostly encouraging. More earnings are set to follow, with conglomerate General Electric (GE), Schlumberger (SLB) and Morgan Stanley (MS) among the notable companies scheduled to release their quarterly results before the markets open.

At 6:15 am ET, the Dow futures are rising 15 points, the S&P 500 futures are moving up 1.70 points and the Nasdaq 100 futures are adding 12.75 points.

U.S. stocks focused on the near-term positives concerning the Congressional deal and ended mostly higher on Thursday.

On the economic front, the Conference Board is scheduled to release its U.S. leading economic indicators index for September at 10 am ET. Economists expect a 0.6 percent month-over-month increase in the leading economic indicators index.

Federal Reserve Governor Daniel Tarullo and New York Fed President William Dudley are due to speak at a Fed conference on the resolution of systemically important banks in Washington. Chicago Federal Reserve Bank President Charles Evans will speak on the economy and monetary policy in Chicago at 2 pm ET. Federal Reserve Governor Jeremy Stein is scheduled to speak on managing financial imbalances in Boston at 4:30 pm ET.

In corporate news, Google (GOOG) reported third quarter adjusted earnings of $10.74 per share compared to $8.87 per share reported last year. The earnings beat estimates. Revenues came in at $14.89 billion, exceeded the consensus estimate.

Capital One Financial (COF) reported third quarter net income of $1.86 per share, nearly flat with the year-ago earnings of $1.87 per share, on net revenues of $5.7 billion. The results were ahead of expectations.

Las Vegas (LVS) reported third quarter adjusted earnings of 82 cents per share, up 78.3 percent year-over-year, and net revenues climbed 31.7 percent to $3.57 billion. The results exceeded estimates.

Rambus (RMBS) reported third quarter non-GAAP earnings of 15 cents per share on revenues of $73.3 million. The results were better than expected.

AMD (AMD) reported third quarter non-GAAP net income of 4 cents per share on revenues of $1.46 billion, up 15 percent year-over-year. For the fourth quarter, the company expects revenues to decline by 3 percent to increase by 5 percent sequentially. The results exceeded estimates and the guidance was in line with estimates.

Chipotle Mexican Grill (CMG) reported third quarter earnings of $2.66 per share, up 17.2 percent year-over-year. Revenues increased 18 percent to $826.9 million. The earnings missed estimates, while the revenues were ahead of expectations. The company estimates mid single-digit comparable restaurant sales for 2013 and low single-digit comparable restaurant sales, excluding any menu price increases, for 2014. T

The Asian markets closed on a mixed note, as strong Chinese data prompted traders to stay invested in stocks. The Australian, Chinese, Hong Kong, Indian, Singaporean, South Korean and Taiwanese markets closed higher, while the Japanese and New Zealand markets retreated.

Australia's All Ordinaries benefited from the strong Chinese data, as added 39.10 points or 0.74 percent before closing at 5,321. The market witnessed broad based strength, with consumer staple, financial and healthcare stocks advancing strongly in the session. Hong Kong's Hang Seng Index closed at 23,340, up 245.22 points or 1.06 percent, and China's Shanghai Composite Index closed 5.24 points or 0.24 percent higher at 2,194.

Meanwhile, Japan's Nikkei 225 average ended down 24.97 points or 0.17 percent at 14,562. Exports stocks ended mostly lower and financial and insurance stocks also saw weakness, while heavy machinery, real estate and rail utilities gained ground.

On the economic front, a report released by the Chinese National Bureau of Statistics showed that China's third quarter GDP rose 7.8 percent year-over-year, in line with estimates and faster than the 7.5 percent growth in the second quarter. Separate data also showed that retail sales rose 13.3 percent year-over-year compared to the 13.4 percent growth in August and the 13.5 percent growth expected by economists.

Industrial production growth of 10.2 percent came in line with estimates. At the same time, fixed asset investment in the January to September period rose 20.2 percent, roughly in line with the 20.3 percent estimate.

European stocks opened higher and have been holding onto their gains in early trading.

In corporate news, miner Anglo American said its copper production rose 32 percent year-over-year in the third quarter, while its iron ore production fell 24 percent.

On the economic front, a leading indicator of the French economy increased for the second successive month in August, and at a faster pace than in the previous month, data released by research firm Conference Board showed. The headline index rose 0.6 percent month-over-month to 116.3 after rising 0.3 percent in the previous month.

by RTT Staff Writer