Halftime Report for 4.20.2012

– SNDK -13.4%
– TPX -20.8%
– RVBD -26%

Equity markets themselves are performing well. DJIA front-month futures reclaimed the 13,000 handle, trading nearly 1% higher on the day. S&P futures gained 0.7%, while the NASDAQ futures are up 0.5%. Along with equities, Crude Oil is higher by 1.5%, trading just under $104 per barrel. 

The US$ is also taking a hit today. Yesterday, we wrote that we are waiting for EUR/USD to break out of its Ichimoku Cloud for an indication on where prices may move in the future. That cloud contains prices between 1.3055 and 1.3190 on a daily chart. EUR/USD is trading at 1.3214, so a close at or above the 1.3190 would be a buy signal, possibly for an extension to the 1.35 level.

In Treasury markets, the 30-year bond is down 0.3%, while the 10-year note has fallen 0.1%. 

At this point, on the week, Orange Juice futures are among the largest gaining commodities, rising 3.9%, double the gains of Copper (1.9%) and the DJIA futures (1.8%). On the negative side, Sugar futures are down 7.9% and Natural Gas fell another 2.7%. Year-to-date, Natural Gas is now down 35.4%. Ouch.

Morning Rage 4.20.2012

 General Electric (GE) EPS beat street expectations by a penny, showing EPS of $0.34. Revenue was also strong, up 4% when you back out revenue earned by the NBC-unit, now owned by Comcast. GE prices are indicated up 1% in premarket trade. Schlumberger (SLB) reported EPS in line with consensus, at $0.98, but strong revenue has helped SLB to gain 3% this morning. We are still waiting this morning on McDonald’s (MCD) quarterly report.

The strong day of reports seemingly kicked off last night with Microsoft (MSFT) beating by 2 cents at $0.60. MSFT is indicated to open 3.6% higher when markets open in an hour. Chipolte (CMG) also beat expectations, but CMG has only gained 0.5% ahead of the open. 

Today, officials from the G-20, IMF, and World Bank begin meetings in Washington, D.C. We do not expect any fireworks there until an official communique is released over the weekend – but will keep an ear to the ground.

We are in the midst of an incredibly strong earnings quarter with major companies beating the street’s expectations on a daily basis. Yet, the market has not rallied yet. We think that with all the data out, the market could be biding its time before another run higher. We are eyeing the S&P futures to move back past 1,420 in the coming weeks.

Meadows on the Markets 4.19.2012

Following the close, Chipotle (CMG) reported EPS of $1.97, higher than the $1.93 estimates. CMG is higher by 1.6% in after-hours trading, erasing losses from today’s trading session. Capital One (COF) reported better-than-expected EPS as well, showing quarterly earnings of $1.56. COF is indicated 2% higher after hours. Microsoft (MSFT) beat expectations as well, sending that stock 2.9% higher after hours.

Tomorrow might be a slow day on the street – though earnings reports from GE, McDonald’s (MCD), and Schlumberger (SLB) might spice things up a bit.

Halftime Report for 4.19.2012

In the agriculture sector, Corn and Wheat futures saw buying – gaining 2.9% and 2.1%, respectively.

Once again, we are skeptical that there will be much action this afternoon. The market appears to be consolidating, with resistance ahead of 1,400 on the S&P futures. With the way things are looking, the market may wait until earnings season is over before its next move. Check out Alex’s view of the S&P technicals here.

Morning Rage 4.19.2012

 U.S. Equity markets are higher with the DJIA and S&P front-month futures gaining 0.25% and NASDAQ futures higher by 0.5%. Earnings reports continue to be solid. Last night, YUM Brands! (YUM), VMWare (VMW), eBay (EBAY), American Express (AXP), F5 Networks (FFIV), Marriott (MAR), and Qualcomm (QCOM) were among the companies that reported to beat earnings expectations. As a result, VMW’s price target was upgraded this morning at three houses, and FFIV’s rating was upgraded at two houses. VMW is up 2.4%, while FFIV gained 7% in premarket trade.

Crude Oil futures are flat after sharp declines yesterday. An interesting piece in the WSJ notes that while Gasoline futures have come down 6.3%, prices at the pump have only dropped 0.5%. But, the WSJ says, some traders are putting a top on Gasoline futures … I’d wait until CNBC confirms the top before we are definitely in for another rally.

Not much going on in currency markets. EUR/USD is pressured, down almost 100-pips from its session highs. But, the pair is trading in the very familiar 1.3075-1.31 area. We continue to monitor the currency for a breakout of the Ichimoku Cloud on the daily chart. That would mean prices would have to close below 1.3055 or above 1.32 before it indicates a sell or buy, respectively. 

As for data, weekly jobless claims were released at 8:30 a.m. ET, showing a seasonally adjusted 386,000 people filed to receive initial unemployment benefits last week. There is a lot of talk about the seasonality factors that are happening with the Labor Department’s data, so the fact that this is higher-than-expected is unlikely to weigh markets down. At 10:30 a.m. ET, traders will look at the weekly Natural Gas inventory data for some volatility there. Hint: Don’t buy Natural Gas. Futures are down another 0.6% today, marking another 2.1% decline this week.

Meadows on the Markets 4.18.2012

In currency markets, EUR/USD erased early losses to close above the 1.31 figure. USD/JPY moved higher, gaining to 81.25. Gold fell 0.5%, closing below $1,650 per ounce. 

Tonight, all eyes turn to Spain to see how well their auction performs. Seems to be a simple formula for tomorrow: better-than-expected results = higher equities; worse-than-expected = lower equities. Now, what happens if the results are as expected… that’s the real question.