OVERNIGHT MARKETS AND NEWS
Mar E-mini S&Ps (ESH18 +0.21%) this morning are up +0.20% on carry-over support from the passage of tax reform by U.S. legislators on Wednesday that President Trump said he will sign into law on Jan 3. European stocks are down -0.07%at a 2-week low after a gauge of UK Dec consumer confidence unexpectedly fell to a 4-year low as Brexit concerns weighed on UK consumers, and as European government bond yields rose after the 10-year bund yield climbed for a fourth day to a 1-3/4 month high of 0.430%. Asian stocks settled mostly lower: Japan -0.11%, Hong Kong +0.45%, China +0.38%, Taiwan -0.15%, Australia -0.25%, Singapore -0.36%, South Korea -1.86%, India -0.06%. Chinese stocks were a bright spot for Asian markets as they closed higher and garnered support from a report from the Xinhua news agency that said the PBOC will keep monetary policy "prudent and neutral' next year.
The dollar index (DXY00 +0.16%) is up +0.11%. EUR/USD (^EURUSD) is down -0.03%. USD/JPY (^USDJPY) is up +0.12% at a 1-week high after the BOJ left monetary policy unchanged.
Mar 10-year T-note prices (ZNH18 +0.10%) are up +3.5 ticks.
The UK Dec GfK consumer confidence unexpectedly fell -1 to a 4-year low of -13, weaker than expectations of no change at 12.
UK Nov public sector net borrowing increased by +8.1 billion pounds, weaker than expectations of +8.3 billion pounds, but still the most in 7 months.
The BOJ in an 8-1 vote maintained their policy rate at -0.1% and kept a target of 0% for 10-year government bond yields and BOJ Governor Kuroda said there's no need to reconsider the current policy framework.
U.S. STOCK PREVIEW
Key U.S. news today includes: (1) weekly initial unemployment claims (expected +8,000 to 233,000, previous -11,000 to 225,000) and continuing claims (expected +12,000 to 1.898 million, previous -27,000 to 1.886 million), (2) revised Q3 GDP (expected unrevised at +3.3% q/q annualized), (3) Nov Chicago national activity index (expected -0.15 to 0.50, Oct 0.65), (4) Dec Philadelphia Fed business outlook survey (expected -1.7 to 21.0, Nov -5.2 to 22.7), (5) USDA weekly Export Sales, (6) Oct FHFA house price index (expected +0.4% m/m, Sep +0.3% m/m), (7) Nov leading indicators (expected +0.4%, Oct +1.2%), (8) Treasury auctions $14 billion 5-year TIPS.
Notable Russell 1000 earnings reports today include: Accenture (consensus $1.67), Paychex (0.59), CarMax (0.81), ConAgra (0.52), Cintas (1.26), NIKE (0.40).
U.S. IPO's scheduled to price today: none.
Equity conferences this week: none.
OVERNIGHT U.S. STOCK MOVERS
JPMorgan Chase (JPM -0.35%) was upgraded to 'Buy' from 'Neutral' at Buckingham Research Group with a price target of $135.
Darden Restaurants (DRI -1.05%) was upgraded to 'Buy' from 'Hold' at Argus Research.
RBC Bearings (ROLL +2.41%) was rated a new 'Buy' at Drexel Hamilton LLC with a 12-month target price of $140.
PG&E (PCG -1.79%) tumbled 9% in after-hours trading after it said it will suspend its dividend payment on common stock starting in the current quarter due to uncertainty related to liabilities from wildfires in California.
Varex Imaging (VREX +4.86%) was upgraded to 'Neutral' from 'Underweight' at JPMorgan Chase
Aimmune (AIMT +2.14%) was rated a new 'Outperform' at Baird with a 12-month target price of $64.
Veritone (VERI -1.93%) jumped 8% in after-hours trading after-acquired Data Analytics Software and the IP assets of Atigeo. Veritone said it will incorporate some of Atigeo's technology into Veritone aiWARE.
Mustang Bio (BIO -0.76%) was rated a new 'Outperform' at Oppenheimer with an 18-month target price of $18.
Bed Bath & Beyond (BBBY +2.50%) slid 4% in after-hours trading after it reported a Q3 gross margin of 35.2%, below consensus of 35.8%.
Vocera Communications (VCRA +0.90%) was rated a new 'Outperform' at Baird with a 12-month target price of $35.
Etsy (ETSY +2.02%) gained 1% in after-hours trading after it was rated a new 'Overweight' at KeyBanc Capital Markets with a 12-month target price of $26.
Kura Oncology (KURA +1.42%) was rated a new 'Outperform' at Wedbush with a 12-month target price of $19.
Advaxis (ADXS +12.21%) dropped 3% in after-hours trading after it reported a fiscal 201 net loss of -$93.4 million versus a loss of -$73.6 million in 2016.
MARKET COMMENTS
Mar S&P 500 E-mini stock futures (ESH18 +0.21%) this morning are up +5.25 points (+0.20%). Wednesday's closes: S&P 500 -0.08%, Dow Jones -0.11%, Nasdaq -0.13%. The S&P 500 on Wednesday closed lower on profit-taking and long liquidation in stocks after Congress finally passed tax-reform legislation and on higher interest rates after the 10-year T-note yield jumped to 9-month high of 2.50%. Stocks were supported by the +5.6% increase in U.S. Nov existing home sales to a 10-3/4 year high of 5.81 million, stronger than expectations of +0.9% to 5.53 million.
Mar 10-year T-note prices (ZNH18 +0.10%) this morning are up +3.5 ticks. Wednesday's closes: TYH8 -7.50, FVH8 -3.25.Mar 10-year T-notes on Wednesday fell to a new contract low and the 10-year T-note yield jumped to a 9-month high. T-note prices were undercut by the increase in U.S. Nov existing home sales to a 10-3/4 year high and the jump in inflation expectations after the 10-year T-note breakeven inflation rate climbed to a 7-1/2 month high. T-note prices were also undercut by technical selling with the new contract low.
The dollar index (DXY00 +0.16%) this morning is up +0.106 (+0.11%). EUR/USD (^EURUSD) is down -0.0003 (-0.03%) and USD/JPY (^USDJPY) is up +0.14 (+0.12%) at a 1-week high. Wednesday's closes: Dollar Index -0.128 (-0.14%), EUR/USD +0.0031 (+0.26%), USD/JPY +0.51 (+0.45%). The dollar index on Wednesday slid to a 2-week low and closed lower on the Senate's passage of the Republican tax reform legislation, which led to profit-taking and long liquidation in the dollar. The dollar was also undercut by the fact that the U.S. tax reform plan will widen the budget deficit, which is dollar negative.
Feb crude oil (CLG18 -0.19%) this morning is down -8 cents (-0.14%) and Feb gasoline (RBG18 unch) is +0.0012 (+0.07%). Wednesday's closes: Feb WTI crude +0.53 (+0.92%), Feb gasoline +0.0338 (+1.98%). Feb crude oil and gasoline on Wednesday rallied to 1-week highs and closed higher on the fall in the dollar index to a 2-week low and the -6.5 million bbl decline in EIA crude inventories to a 2-year low, a bigger decline than expectations of -3.0 million bbl. Gasoline prices were undercut by the +1.24 million bbl increase in EIA gasoline stockpiles, less than expectations of +2.3 million bbl.
Metals prices this morning are weaker with Feb gold (GCG18 -0.10%) -1.4 (-0.11%), Mar silver (SIH18 -0.28%) -0.065(-0.40%) and Mar copper (HGH18 -0.05%) -0.003 (-0.09%). Wednesday's closes: Feb gold +5.4 (+0.43%), Mar silver +0.122 (+0.76%), Mar copper +0.0445 (+1.41%). Metals on Wednesday closed higher with Feb gold and Mar silver at 2-week highs and Mar copper at a 1-3/4 month high. Metals prices were boosted by the decline in the dollar index to a 2-week low and by the stronger-than-expected increase in U.S. Nov existing homes sales to a 10-3/4 year high, which is supportive for copper demand.
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