Morning Report: November 28, 2011

Ahead of the Bell: Dow futures are trading up 233 points and S&P futures are trading up 30.60 points after the Dow and S&P posted their worst Thanksgiving week since 1932.   Futures are trading higher as credit default swaps for Italy, Belgium, Spain, and France are falling today and reports from “Black Friday” weekend are indicating strong results for retailers.


·     On the economic calendar, New Home Sales are expected out at 10:00 am, and economists are forecasting that the reading will be 313k.  The Dallas Fed Manufacturing Survey is also expected today and will be out at 10:30 am. Thedollar is down against the Euro and British Pound and up against the Japanese Yen.  Crude oil is currently trading at about $99.75 per barrel.  Gold is currently trading at $1,716.


·     An International Monetary Fund spokesperson denied that the IMF is in financing discussions with Italian authorities.  Over the weekend the Italian newspaper La Stampa had reported that up to €600 billion would be made available to Italy at a rate of 4-5%.   


·     Today is “Cyber Monday”, and online retailers can hope to do as well as their brick and mortar counterparts did on “Black Friday.”  Retailers posted sales up 6.6% over Black Friday 2010, and sales for the weekend were up 16.4% to $52.4 billion.


·     On CNBC this morning, Bob Doll, Chief Equity Strategist for BlackRock Inc., was on discussing what steps he is taking to hedge portfolios against risk.  Doll said that he sees the S&P trading in a range from 1,100-1,250, although if there is a worst case scenario in Europe it would break below the 1,100 barrier.  Should the worst case scenario come to fruition, Doll would advise avoiding cyclical, but does not see a high probability of the worst case scenario playing out. 


·      Have a great week!


Friday’s Close


DJIA down 25.77 pts/-0.23%/11,231.78


S&P down 3.12 pts/-0.27%/1,158.67


Nasdaq down 18.57/-0.75%/2,441.51


 


Monday’s Futures


Dow Futures up 233 pts/+2.04%


S&P Futures up 30.60 pts/+2.58%


Nasdaq Futures up 50.00 pts/2.27%


 


Overseas Markets


FTSE +2.04%


CAC 40 +3.72%


NIKKEI 225 +1.56%


HANG SENG +1.97


 


Overseas:  World markets are higher as markets bounce off last week’s lows on hope that we may be closer to a solution in Europe, despite the IMF’s denial that it is in financing discussions with Italy.


 


Economic Reports:  New Home Sales (expected to be 313k) at 10:00 am and Dallas Fed Manufacturing Survey (expected to be 5.0) at 10:30 am


 


Top Headlines:    


 ·     BHP Billiton has appointed Graham Kerr as CFO, following the announcement that Alex Vaneslow, current CFO, will retire at the end of February.


 ·     Anadarko Petroleum announced a successful appraisal at its Barquentine-3 property.  The results indicate that the gas finds were twice as large as originally forecasted.


·     Ternium SA has entered into a share purchase agreement with Camargo Correa Votorantim and Caixa dos Empregados Usuminas to purchase 27.7% of the voting capital of Usiminas for $2.2 billion.


Commodities/Currency:


Gold:up $27.60 to $1,716.30
Oil:up $2.95 to $99.73

EUR/USD 1.3369 +0.0051
USD/JPY 77.68 +0.11
GBP/USD 1.5582 +0.00880


 


Volatility Index (VIX): As of the close of business Friday, November 25, the VIX is up 0.23 to 34.21


 


Companies Reporting Quarterly Earnings:   


None


Today’s Opening and Closing Bells:


IRSA, a leading real estate company in Argentina, visits the NYSE.In honor of the occasion, Chairman and CEO Eduardo Elsztain rings The Opening BellSM.


Vale (NYSE-Listed VALE) visits the New York Stock Exchange as part of Vale Day at the NYSE, the Company’s annual NYC Capital Markets Event.In honor of the occasion, Murilo Ferreira, Chief Executive Officer, rings The Closing BellSM.