Before the Open (Oct 17)

Good morning. Happy Thursday.
The Asian/Pacific markets closed with an upside bias. Indonesia, Japan and Taiwan moved up the most. Hong Kong and India moved down. Europe currently leans to the downside. France, Germany and Italy are down the most. Switzerland is the only country posting a decent gain. Futures here in the States hint at a flat-to-down open for the cash market.

The dollar is getting hit hard (down 0.8%). Oil and copper are down. Gold and silver are up a bunch.
Washington has kicked the can down the road. They’ve agreed to finance the US government until Jan 15 and raise the debt limit until Feb 7. So they accomplished very little other than to put a band-aid over their differences. The S&P is already up 75 points the last week in anticipation of this “agreement,” so expecting more may be asking for too much…especially since not all indicators are supporting a full-blown rally.
You can’t argue with the market’s movement or position. The Nasdaq, Russell 2000 small caps and S&P 400 mid caps are sitting at new highs. The S&P is less than 10 points from its own new high. Once again the bears are dazed and confused and utterly frustrated. To the smart money, the fiasco in Washington was nothing more than an opportunity to buy more stocks at lower prices.
Now Wall St. can focus on other things, such as earnings. Also, many economic reports were not released the last two weeks. Some don’t matter. Others, such as the latest employment data, do. I have no idea what the game plan will be. These reports don’t generate themselves. It’ll take time to collect the data, but eventually we’re going to get a glut of numbers hitting the market at the same time.
IBM disappointed with earnings. The stock is down 14 bucks, or 7.5% in premarket trading. This will hurt the Dow.
GS is down 4.24 (2.6%)…also earnings related…also a Dow stock.
EBAY is down 3.00 (5.5%)…earnings related.
The market has already popped, so don’t expect a hysterical move up right now. The shorts have already gotten squeezed. If anything, given the lack of broad participation, I’d suggest playing good defense with your existing positions. There are solid gains on many of the Long List stocks.
Stock headlines from barchart.com…
Goldman Sachs (GS +2.93%) is down 2% in pre-market trading after it reported Q3 EPS of $2.88, better than consensus of $2.43, but reported Q3 revenue of $6.72 billion, below consensus of $7.36 billion.
Sonoco Products (SON +0.78%) reported Q3 base EPS of 63 cents, better than consensus of 61 cents.
Verizon Communications (VZ +2.01%) reported Qe EPS of 77 cents, better than expectations of 74 cents.
Harley-Davidson (HOG +1.98%) is voluntarily recalling over 28,000 2014 Touring motorcycles equipped with a hydraulic clutch system that may pose a safety issue for riders and/or passengers.
Crown Holdings (CCK -0.80%) reported Q3 EPS of $1.13, better than consensus of $1.08.
Noble Corp. (NE +0.59%) reported Q3 EPS ex-gain of 85 cents, better than consensus of 70 cents.
SanDisk (SNDK +0.40%) climbed 2% in after-hours trading after it reported Q3 adjusted EPS of $1.59, well ahead of consensus of $1.32.
Xilinx (XLNX +1.21%) fell over 4% in after-hours trading after it reported Q2 EPS of 49 cents, below consensus of 53 cents.
eBay (EBAY -0.83%) slid 5% in after-hours trading after it reported Q3 EPS of 64 cents, just above consensus of 63 cents, but said it sees Q4 EPS of 79 cents-81 cents, weaker than consensus of 83 cents.
Amarin (AMRN +3.19%) was downgraded to “Neutral” from ‘Buy’ at SunTrust and from ‘Hold’ to ‘Buy’ at Aegis.
Universal Forest (UFPI +1.21%) reported Q3 EPS of 71 cents, well ahead of consensus of 54 cents.
IBM (IBM +1.12%) fell over 6% in after-hours trading after it reported Q3 EPS of $3.99, better than consensus $3.96, although Q3 revenue of $23.7 billion was below consensus of $24.77 billion.
American Express (AXP +1.42%) reported Q3 EPS of $1.25, better than consensus of $1.22.
Earnings and Economic Numbers from seekingalpha.com…
Today’s economic calendar:
8:30 Initial Jobless Claims
9:15 Industrial Production
9:45 Bloomberg Consumer Comfort Index
10:00 Philly Fed Business Outlook
10:30 EIA Natural Gas Inventory
11:00 EIA Petroleum Inventories
4:30 PM Money Supply
4:30 PM Fed Balance Sheet
Notable earnings before today’s open: ADS, APH, BAX, BBT, BGG, BTU, BX, CY, DGX, DHR, DOV, FCFS, FCS, FITB, GS, HBAN, HLSS, MTB, NUE, ORB, OSTK, PENN, PM, PPG, SNA, SON, SVU, SYNT,TSM, TZOO, UNH, UNP, UTEK, VZ, WGO
Notable earnings after today’s close: ACTG, ALGN, AMD, ASBC, ATHN, BGS, CMG, COF, CPHD, CYT, FNB, GHL, GOOG, ISRG, LVS, PBCT, RMBS, SYK, VMI, WAL
Other…
today’s upgrades/downgrades from briefing.com
this week’s Earnings
this week’s Economic Numbers