Morning Report: April 29, 2011

Ahead of the Bell: Dow futures are trading up 18 points and S&P futures are trading up 2 points after Caterpillar reported better than expected quarterly results on higher sales and revenues.  Also, according to data released by the European Central Bank, inflation rose above what the ECB was expecting, increasing the possibility of another interest rate hike by the central bank.  Crude oil is currently trading at about $112 a barrel.         

• On the economic calendar today, personal income and spending will be out before the market opens and is expected to advanced 0.3 percent after a 1.2 percent increase the prior month.  After the markets opens, Chicago PMI, a regional manufacturing index, and a final April reading on consumer sentiment will be out.  Also, Federal Reserve Chairman Ben Bernanke will be speaking to the San Francisco Federal Reserve Bank Community Affairs Research Conference in Arlington, Virginia.  Companies reporting earnings include  Chevron, Weyerhaeuser, and Merck.     
• Yesterday, stocks finished up as investors digested a series of corporate earnings reports and economic data, the Dow and S&P finished up on new three-year highs. Gold and silver also hit new highs on the backs of a weaker dollar.
• On CNBC today, President and CEO of Discovery Communications, David Zaslav talked about the future of cable and expanding internationally.  Zaslav played a key role in developing and launching CNBC in 1989.  Discovery is a pure play cable company that reaches more than 1.5 billion viewers around the world through TLC, Animal Planet, and the Oprah Winfrey network.  Zaslav is currently expanding outside the U.S. where Discovery has seen a 16% increase in advertising sales and good margins.   Zaslav also said he believes the future is about content and that Discovery is in the process of becoming a great content company which will allow it to have great growth.     
• Happy Friday, have a nice weekend.  

Thursday’s Close

DJIA up 72.35 pts/+0.57%/12,763.31

S&P up 4.82 pts/+0.36%/1,360.48

Nasdaq up 2.65 pts/+0.09%/2,872.53

Friday’s Futures

Dow Futures up 18.00 pts/+0.15%

S&P Futures up 2.00 pts/+0.15%

Nasdaq Fut up 1.75 pts/+0.06%

Overseas Markets

FTSE +0.03%

CAC 40 -0.13%

NIKKEI 225 +1.63%

HANG SENG -0.36%

Overseas:  World stock markets were lower today.  European markets are trading down on Euro zone inflation, London is closed for a holiday.  Asian markets were down on slower growth from the U.S., Japan was closed for a holiday.

Economic Reports:  Personal Income and Outlays expected to be 0.03% @8:30 a.m., Chicago PMI expected to be 68.0 @9:45 a.m. & Consumer Sentiment expected to be 69.6 @ 9:55 a.m.  

Top Headlines:    

• Enterprise Products Partners (EPD) announced it is acquiring Duncan Energy Partners (DEP). Duncan holders will receive 1.01 of Enterprise common units in exchange for each Duncan common unit held.
• Total S.A. (TOT) announced it will begin a tender offer to acquire about 60% of SunPower’s class A common shares and 60 percent of SunPower’s class B common shares at a price of $23.25 per share for each class.
• Bloomberg reports the European Union has started an antitrust investigation into credit-default swaps that involve Goldman Sachs, JPMorgan and other investment banks.      
• CNBC reports Gen-Probe Inc., (GPRO) a maker of tests for AIDS and the West Nile virus has hired Morgan Stanley to seek a buyer for the company.
• J&J said it has declared a 5.6% increase in the quarterly dividend rate, from $0.54 per share to $0.57 per share, payable on June 14, 2011 to holders of record as of May 31, 2011.

Commodities/Currency:

Gold:up $0.65 to $1,536.85

Oil:down $0.21 to $112.65



EUR/USD 1.4873 +0.0048

USD/JPY 81.2750  -0.2750

GBP/USD 1.6660 +0.0022

Volatility Index (VIX): As of the close of business Thursday, April 28, the VIX is down 0.73 pts to 14.62

Companies Reporting Quarterly Earnings:   

Caterpillar (CAT): Q1 EPS of $1.84 beats by $0.53. Revenue of $12.94B (+57.2% Y/Y) beats by $1.25B.

Merck (MRK): Q1 EPS of $0.92 beats by $0.08. Revenue of $11.58B (+1.4% Y/Y) beats by $0.22B.

Weyerhaeuser (WY): Q1 EPS of $0.18 vs consensus of $0.15. Revenue of $1.57B (-5.2% Y/Y) misses by $0.09B.

Calpine (CPN): Q1 EPS of -$0.61 vs consensus of -$0.13.

Lear (LEA): Q1 EPS of $1.46 beats by $0.31. Revenue of $3.51B (+19.5% Y/Y) beats by $0.24B.

Simon Property Group (SPG): Q1 EPS of $1.61 beats by $0.07. Revenue of $1.01B (+10.2% Y/Y) beats by $0.01B.

D.R. Horton (DHI): FQ2 EPS of $0.09 beats by $0.14.

ITT Industries (ITT): Q1 EPS of $0.98 beats by $0.05. Revenue of $2.76B (+7% Y/Y) beats by $0.12B.

Entergy (ETR): Q1 EPS of $1.38 beats by $0.04. Revenue of $2.54B (-8% Y/Y) misses by $0.24B.

Pitney Bowes (PBI): Q1 EPS of $0.53 in-line. Revenue of $1.32B (-1.9% Y/Y) misses by $0.03B.

Apartment Investment and Management Company (AIV): Q1 EPS of $0.39 beats by $0.03. Revenue of $286M (+3.5% Y/Y) beats by $3M.

Aon Corporation (AON): Q1 EPS of $0.80 in-line. Revenue of $2.75B (+45% Y/Y) beats by $0.02B.

Newell Rubbermaid (NWL): Q1 EPS of $0.30 beats by $0.02.

Calpine (CPN): Q1 EPS of -$0.61 vs consensus of -$0.13.

Weyerhaeuser (WY): Q1 EPS of $0.18 vs consensus of $0.15. Revenue of $1.57B (-5.2% Y/Y) misses by $0.09B.

Today’s Opening and Closing Bells:

ING Investment Management to Celebrate the Listing of ING Emerging Markets High Dividend Equity Fund Jeff Becker, CEO of ING Investment Mgt will ring the opening bell.  

The Make-A-Wish Foundation to Celebrate World Wish Day will ring the closing bell.