Morning Report: September 14, 2011

José Manuel Barroso - World Economic Forum Ann...

Image by World Economic Forum via Flickr

Ahead of the Bell: Dow futures are trading up 68 points and S&P futures are trading up 8 points after European markets pared losses. The head of the European Commission, Jose Manuel Barroso plans on introducing options for euro zone bonds, and China might offer support for the Euro zone. Moody’s Investor Services downgraded French banks, Credit Agricole and Societe Generale. Traders are concerned there is no leadership from the region, and the lack of decisive action from Greece has prompted German Chancellor, Angela Merkel and French Prime Minister, Nicolas Sarkozy to call a meeting with Greece's Prime Minister, George Papendreou, as the country is teetering on the brink of default.

  • On the economic calendar today, the Commerce Department will release Producer Price Index, which is a measure of wholesale inflation, before the market opens. Economists expect the index to be the same in August after rising 0.2% in July. Retail Sales will also be out before the market opens. According to Briefing.com, economists expect retail sales to increase 0.2% in August after a 0.5% rise the previous month. Business Inventories will be out after the market opens and is likely to show an increase of 0.5%. Companies reporting earnings include CLARCOR Inc. and Pall Corp. The dollar is up against the Japanese yen and down against the euro and British pound. Crude oil is currently trading at $89 a barrel. Gold is trading at $1,832.   
  • Yesterday, stocks rose after French banks dismissed concerns over their access to funds and investors watched for signs of progress in efforts to tame the euro region’s debt crisis.
  • On CNBC today, Jeb Bush, former Florida Governor, talked about fixing the economy. Bush said if you had a long term strategy it would be good for the short term, it would boost growth, but we don’t have a strategy, real stimulus comes when the private sector invest. Bush also said liberals and conservatives agree on a need for education reform, this is where the President and Congress can find common ground by paying more to teachers. Bush pointed out there is a deep funk in the U.S. now, because people don’t think there is a plan. Bush went on to say, the president can show goodwill by approving the Canadian pipeline deal, tax reform, entitlement reform, and approve the pending trade agreements. Bush believes the best way to invest in infrastructure is as part of a high growth strategy, 25% corporate tax rate without loopholes would increase competitiveness. Bush does not think there is much in the jobs bill proposed by President Obama to create jobs and should have engaged the GOP before publicizing the proposal. Finally, Bush said the regulatory environment is bad and getting worse, we need some form of moratorium on regulation that would help spur growth.       
  • Happy Wednesday, have a nice day.

Tuesday’s Close

DJIA up 44.73 pts/+0.40%/11,105.85

S&P up 10.60 pts/+0.91/1,172.87

Nasdaq up 37.06 pts/+1.49/2,532.15

Wednesday’s Futures

Dow Futures up 68.00 pts/+0.55%

S&P Futures up 8.30 pts/+0.54%

Nasdaq Fut up 17.58 pts/+0.39%

Overseas Markets

FTSE +1.10%

CAC 40 +1.48%

NIKKEI 225 -1.14%

HANG SENG +0.08%

Overseas:  World stock markets were mixed today.  European markets are up after the head of the European Commission, Jose Manuel Barroso plans on introducing options for euro zone bonds. Asian markets were mixed on hopes China might offer support for the Euro zone.

Economic Reports:  Producer Price Index expected to be -0.2% & and Retail Sales expected to be 0.2% at 8:30 a.m. and Business Inventories expected to be 0.5% at 10:00 a.m..

Top Headlines:    

  • Reports indicate Verizon Wireless (VZ) plans a new unlimited prepaid plan which includes unlimited talk, text and web use for $50 to be sold at Best Buy, Wal-Mart, and Target.
  • CNBC reports General Electric (GE) officially notified Berkshire Hathaway (BRK.A ) it intends next month to repurchase the $3 billion of preferred stock it sold to the firm in 2008.
  • Reports indicate regulators are reviewing two foreign exchange trades by the Bank of New York (BK) on behalf of two pension funds.
  • MBA reports mortgage applications were up 6.3% versus down 4.9% last week. Thirty-year fixed mortgage rate decreased to 4.17% from 4.23%..    

Commodities/Currency:

Gold:down $5.10 to $1,831.85

Oil:down $0.69 to $89.59

EUR/USD 1.3725 +0.0046

USD/JPY 76.8150  -0.1000

GBP/USD 1.5796 +0.0016

Volatility Index (VIX): As of the close of business Tuesday, September 13, the VIX is down 1.68 at 36.91

Companies Reporting Quarterly Earnings:     None as of yet.

Today’s Opening and Closing Bells:

Oiltanking Partners Celebrates Recent NYSE Listing CEO Carlin Conner will ring the opening bell.

Colombia’s Ecopetrol to Visit the NYSE CEO Javier Gutiérrez Pemberthy will ring the closing bell.                                                                                                                                                                                       


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