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Juli 25, 2014
Market Drivers
Jul 24 2014 | 4:11 PM

Equity markets shrugged off geopolitical tensions, and continued their slow grind upward this week. The rally has been helped by a host of positive earnings releases, as well as generally optimistic economic data. Here are three things that have been driving the market this week.

Geopolitical Unrest – Russia, Ukraine, Israel

“Geopolitical unrest” has been a popular buzzword used throughout financial circles and in the media this week. The term refers to several hotbed areas across the globe impacting the psyche of U.S. equity markets. First, we have the ongoing situation following the downing of Malaysian Flight 17 in Ukraine, allegations of tampering with the crash site, and finger pointing for responsibility. We also have the escalating conflict in Israel. The recent round of fighting there between Hamas and Israel has taken more than 600 lives, with little hope for a cease fire in the near future. Lastly, we have the deteriorating situation in Iraq, where...

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Gepost Door: Ronald Bohlert
Managing Director, Global Corporate Client Group
Jul 24 2014 | 10:16 AM

From The Trading Floor: Equities are trading in mixed territory despite some solid earnings on weaker than expected New Home Sales. 

  • Initial Jobless Claims fell by 19,000 to 284,000 for the period ending July 19th, an 8 year low

  • Markit US. Manufacturing PMI slipped slightly to 56.3 for July vs. 57.3 the period earlier

  • The Bloomberg Consumer Comfort Index for the period ending July 20th came in roughly the same as the period before at 37.6

  • New home sales fell to 406,000 for June, lower than the revised 442,000 for May

  • Kansas City Fed Manufacturing Activity Index is at 11:00

  • EU diplomats will convene today to determine an extensive set of economic sanctions to impose upon Russia. The meeting follows the failed attempt of EU foreign ministers earlier this week to formulate a sanctions program.

  • Troubles at the European Central Bank...

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Gepost Door: Charles Brown
Managing Director, The Capital Markets Desk
Jul 23 2014 | 9:58 AM

From The Trading Floor: Stocks are trading in mixed territory this morning after the S&P hit another record on generally better than expected earnings. 

  • Mortgage applications for the week ending July 18th rose by 2.4%

  • Apple reported a FQ3 gross margin of 39.4%, +250 bps Y/Y (above guidance of 37%-38%), driving the $1.28 EPS to beat estimates by $0.05

  • PepsiCo reports core EPS $1.32, consensus $1.23. Reports Q2 revenue $16.89B, consensus $16.81B

  • Discover reports Q2 EPS $1.35, consensus $1.30. Reports Q2 revenue net of interest expense $2.17B, consensus $2.16B.

  • LinkedIn is acquiring Bizo, a provider of display/social ad services for marketers looking to target businesses. 10% of the $175M purchase price will be paid for in stock, and the rest in cash

  • Geopolitical action is heating up in the Ukraine, where the Defense Ministry said that Rebels in the eastern...

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Gepost Door: Charles Brown
Managing Director, The Capital Markets Desk
Jul 22 2014 | 10:10 AM

From The Trading Floor: Equities are trading in positive territory this morning on the easing of Ukraine tensions and positive 2nd quarter earnings

  • The Consumer Price Index for June came in at 0.3, matching the consensus for the month over month reading. The cost of living rose paced by a jump in the cost of gasoline

  • House prices rose 0.4% during May exceeding the expected 0.2% increase

  • Richmond Fed Manufacturing Index rises to 7 for July from the previous period when it was 3

  • Existing Home Sales for June rose to 5.04 million, well above the previous period

  • Time Warner has amended its bylaws to remove a provision allowing shareholders to call a special board meeting - eliminating a potential avenue 21st Century Fox (NASDAQ:FOX) could have used to press an unsolicited takeover offer. The move is intended to give Time Warner (NYSE:TWX) shareholders more time to evaluate the merits of a...

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Gepost Door: Charles Brown
Managing Director, The Capital Markets Desk
Jul 21 2014 | 10:06 AM

From The Trading Floor: Equities are trading in negative territory this morning as geopolitical tensions have investors on the sidelines prior to a major week of earnings.

  • Chicago Fed National Activity Index increased by 0.12 for June, less than the expected 0.18

  • R.J. Reynolds is readying its legal division after a lawsuit slammed the company with $23.6B in punitive damages to be paid to the widow of a longtime smoker who died of lung cancer.

  • Wal-Mart invested $103M into its Indian wholesale business in June, and plans to open 50 more stores in India over the next 4-5 years.

  • Western leaders from Britain, France and Germany have staunchly warned Vladimir Putin of increased sanctions by Tuesday if air accident investigators do not have full access to the crash site in eastern Ukraine

  • Israel and Hamas fail to reach a peace agreement over the weekend as violence increased in Gaza

  • ...

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Gepost Door: Charles Brown
Managing Director, The Capital Markets Desk