Morning Call For November 19, 2014

OVERNIGHT MARKETS AND NEWS

December E-mini S&Ps (ESZ14 +0.04%) this morning are down -0.05% ahead of the minutes of the Oct 28-29 FOMC meeting, while European stocks are up +0.24% at a 1-1/2 week high as health-care stocks gained on speculation of increased M&A activity. Yields on European government bonds rose after ECB policy maker Knot said he was skeptical about the benefits of quantitative easing. Asian stocks closed mostly lower: Japan -0.32%, Hong Kong -0.66%, China -0.16%, Taiwan +1.18%, Australia -0.57%, Singapore +0.63%, South Korea -0.13%, India -0.46%. Commodity prices are mixed. Dec crude oil (CLZ14 +0.20%) is up +0.27%. Dec gasoline (RBZ14 +0.90%) is up +0.75%. Dec gold (GCZ14 -0.18%) is up +0.06%. Dec copper (HGZ14+0.38%) is up +0.32%. Agriculture prices are weaker with Dec corn and Jan soybeans at 1-week lows as the U.S. harvest nears completion. The dollar index (DXY00 +0.13%) is up +0.10%. EUR/USD (^EURUSD) is unch. USD/JPY (^USDJPY) is up +0.64% at a fresh 7-year high after the BOJ concluded a 2-day policy meeting and maintained record stimulus and after BOJ Governor Kuroda warned that it's possible that core inflation may fall below 1%. Dec T-note prices (ZNZ14 -0.15%) are down -6.5 ticks.

Eurozone Sep construction output fell -1.8% m/m, the biggest decline in 20 months. On an annual basis Sep construction output fell -1.7% y/y, the most in 11 months.

Japan Oct nationwide department store sales fell-2.2% y/y, the seventh consecutive month that sales have declined year-over-year.

The Japan Sep all-industry activity index rose +1.0% m/m, right on expectations and the most in 6 months.

The Japan Sep leading index CI was left unrevised at 105.6. The Sep coincident index was revised upward to 109.8 from the originally reported 109.7.

U.S. STOCK PREVIEW

Today’s Oct housing starts report is expected to show a +0.8% increase to 1.025 million, adding to the +6.3% increase to 1.017 million seen in September. The markets suspect that today’s minutes from the Oct 28-29 FOMC meeting may be a bit bearish since the FOMC at that meeting ended QE3, upgraded its assessment of the labor market, and slightly revised its interest rate guidance language. There are 11 of the Russell 1000 companies report earnings today with notable reports including: Target (consensus $0.47), Lowe's (0.58), Staples (0.36), L Brands (0.40), Williams-Sonoma (0.63), Salesforce.com (0.13).

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