Ahead of the Bell: Dow futures are trading up 20 points and S&P futures are trading up 2 points. Tensions in the Far East could lead to a standoff with the US and China this holiday shortened week and keep investors on their heels. The US and Japan defied a request by China to be notified when aircrafts are passing through disputed territorial islands air space in the East China Sea, challenging China to take the next move. Two B-52 Bombers on routine training missions flew through the region, while Japan's main airlines ignored China's demands. Germany's Chancellor Angela Merkel struck a deal with the center-left Social Democrats to form a new government and the ECB announced plans to assist struggling companies in the region.
- On the economic calendar today, October durable goods orders (-2.0% expected), jobless claims for the week ended 11/23 (330K expected) and the Chicago Fed national activity index for October (0.20 expected) will be released before the market opens. After the opening bell, Chicago PMI for November (60.5 expected), consumer sentiment for November (73.3 expected) and leading indicators (+0.1% expected) will be released.
- The dollar is down against the major currencies. Gold is trading at $1,252. Crude oil is currently trading at $93 a barrel.
- Yesterday, stocks rose as Apple led a rally in technology shares and improving housing data boosted investor sentiment.
- On CNBC today, Byron Wien, Vice Chairman of Blackstone Advisory Partners LP and Bob Doll, Chief Equity Strategist and Senior Portfolio Manager at Nuveen Asset Management, talked about the Federal Reserve fueling the equity market. Wien said at the beginning of the year he was expecting the markets to go higher. He did not factor in the enormous power that QE could have on the equity markets. The $85 billion a month purchase of treasury securities coupled with low interest rates pushed stocks higher. The Fed was hoping that a big part of the monetary easing would flow into the main stream economy, but four years later only about a quarter has made its way to the ordinary American, as the unemployment rate remains high. Wien’s advice for investors is if you have a little amount of cash, don’t participate in the market now but if you have a lot of cash, you can jump in. He added, a pullback will happen at some point and everyone knows the Fed will taper, maybe it will be factored into the markets before the central bank announces its reduction in asset purchases. Doll agrees with Wien that the wall of liquidity and low inflation has pushed the markets higher. There is a lot of money on the sidelines which can’t wait for an opportunity to get back in and buy.
- Have a happy and safe holiday!
Tuesday’s Close
DJIA up 0.26 pts/+0.01%/ 16,072.80
S&P up 0.27 pts/+0.01%/ 1,802.77
Nasdaq up 23.18 pts/+0.58%/ 4,017.75
Wednesday’s Futures
Dow Futures up 20.00 pts/+0.12%
S&P Futures up 2.25 pts/+0.10%
Nasdaq Futures up 5.50 pts/+0.14%
Overseas Markets
FTSE +0.15%
CAC 40 +0.23%
NIKKEI 225 +0.33%
HANG SENG +0.18%
Overseas: World stock markets are mixed today. European markets are up after Germany announced plans to form a new government. Asian markets are lower over tension in the East China Sea between China and Japan.
Economic Reports: Durable Goods Orders (-2.0% expected); Jobless Claims (330K expected); Chicago Fed National Activity Index (0.20 expected); Chicago PMI for November (60.5 expected); Consumer Sentiment (73.3 expected); Leading Indicators (+0.1% expected).
Top Headlines:
- Hewlett-Packard Company (HPQ) beats revenue forecast amid sales growth in its enterprise group which boosted investor confidence in CEO Meg Whitman's turnaround strategy as shares rallied more than 7% following its quarterly results.
- Reports indicate the Federal Reserve was pressuring JPMorgan Chase (JPM) more than a year ago to divest or distance its self from its metals warehouse business long before it became the focal point in the debate over its role in physical commodities trading.
- Reports indicate Cox Communications is considering making a bid for rival Time Warner Cable (TWC) on its own or with partners following similar reports by Comcast Corporation (CMCSA) and Charter Communications (CHTR).
Commodities/Currency:
Gold:up $10.30 to $1,252.40
Oil:down $0.44 to $93.24
EUR/USD 1.3595 +0.0026
USD/JPY 101.7950 +0.5115
GBP/USD 1.6312 +0.0102
Volatility Index (VIX): As of the close of business Tuesday, November 26, 2013 the VIX is up 0.02 at 12.81
Companies Reporting Quarterly Earnings:
Acorn International reports 3Q Loss/$0.39 per share and 3Q revenue loss of $10.6M. Sees FY 2013 revenue $190M to $210M.
Today’s Opening and Closing Bells:
Burlington Stores visits the NYSE to kick off the holiday shopping season and will ring the opening bell.
Macy’s, Inc. - 87th Annual Thanksgiving Day Parade will ring the closing bell.
Paras Madho – Corporate Actions & Market Watch
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