Good morning. Happy Wednesday.
The Asian/Pacific markets closed mostly down. China, Hong Kong, Japan and South Korea dropped more than 1%. Indonesia, Malaysia and New Zealand moved up. Europe is down across the board. Greece is down 4%, Spain 2%, Italy and France 1%. Futures here in the States point towards a moderate gap down for the cash market.
The dollar is up. Oil and copper are down. Gold and silver are down.
Yesterday NFLX did great with earnings. The stock gapped up and then got crushed. After the close it was reported Carl Icahn cut his holding from around 10% to 4.5%. Should we be surprised? No way. These guys fashion themselves as shareholder activists who are looking out for shareholders. In reality they care about one thing and one thing only. Making money. They’re not in it for the long haul. They don’t care about the company or the customers or the employees or the long term prospects or anything like that. They only care about doing everything possible in the very near term to get the stock price up right now. If I was Tim Cook, I’d tell Icahn to screw off next time he wanted to have lunch to discuss ideas he had.
As I’ve said all week, the trend on all time frames is solidly up, but I’d be a little careful chasing the market higher here. At the very least, recognize you’re buying after a 10-day, 100-point rally, so your risk/reward is not as favorable as it was two weeks ago.
When the trend is up, I go back and forth between being all-in on the long side or only partially long. My expectations also change from targeting 10-20% gains to being content with 5% gains. A trade I may have high expectations for one week may be a quickie the next week. My style doesn’t change, but my expectations do.
Stock headlines from barchart.com…
Eli Lilly (LLY +1.01%) reported Q3 EPS of $1.11, better than consensus of $1.04.
Northrop Grumman (NOC +1.26%) reported Q3 EPS of $2.14, stronger than consensus of $1.82.
General Dynamics (GD +0.18%) reported Q3 EPS of $1.84, well ahead of consensus of $1.68.
NASDAQ OMX Group (NDAQ -0.33%) reported Q3 EPS of 66 cents, better than consensus of 62 cents.
Netflix (NFLX -9.15%) fell over 2% in after-hours trading after billionare investor Carl Icahn reported a sale of 2.99 million shares of Netflix.
Unisys (UIS +1.75%) reported Q3 adjusted EPS of 25 cents, weaker than consensus of 40 cents.
Reuters reported that JPMorgan Chase’s (JPM -1.20%) $13 billion settlement with the U.S. could cost the bank closer to $9 billion, as most of the deal is expected to be tax deductible.
Apollo Group (APOL +0.10%) jumped over 12% in after-hours tradng after it reported Q4 EPS ex-items of 55 cents, more than double consensus of 25 cents.
C.R. Bard (BCR +0.67%) reported Q3 EPS of $1.50, well ahead of consensus of $1.40.
Corning (GLW +1.72%) soared over 20% in pre-market trading after it reported preliminary Q3 EPS of 33 cents, better than consensus of 32 cents, and said it approved a $2 billion stock buyback and agreed to purchase full ownership of Samsung Electronics’ 43% stake in Samsung Corning Precision Materials Co., which makes glass for liquid crystal displays in South Korea.
Broadcom (BRCM -0.66%) fell over 6% in after-hours trading after it reported Q3 adjusted EPS of 76 cents, better than consensus of 69 cents, but then announced it will cut 1,150 jobs as part of a restructuring,
Juniper (JNPR -2.35%) reported preliminary Q3 EPS of 33 cents, better than consensus of 31 cents.
Amgen (AMGN +2.26%) reported Q3 EPS of $1.94, stronger than consensus of $1.77, and then raised guidance on fiscal 2013 EPS to $7.35 to $7.45, better than consensus of $7.32.
FMC Technologies (FTI -0.45%) reported Q3 EPS of 49 cents, well below consensus of 59 cents.
Earnings and Economic Numbers from seekingalpha.com…
Today’s economic calendar:
7:00 MBA Mortgage Applications
8:30 Import/Export Prices
9:00 FHFA House Price Index
10:30 EIA Petroleum Inventories
Notable earnings before today’s open: AEP, AMAG, ARG, ATI, BA, BEAV, BMY, BPOP, CAT, CKSW, CMC, CP, DPS, EAT, ECA, EDU, FDML, GD, GRA, HCBK, JAKK, LAD, LCC, LL, LLY,LO, MDCO, MOLX, MSA, MSI, MTH, NDAQ, NLSN, NOC, NSC, NYCB, OC, OCR, OSIS, PLD, RES, SIX, TMO, TUP, WLP, WYN
Notable earnings after today’s close: AEM, AIZ, AKAM, ALGT, ANGI, ASGN, AVB, BDN, CAKE, CDNS, CLGX, CMO, CMRE, CTXS, CVA, EFX, EGHT, EQIX, ESV, ETFC, EVR, FBHS, FFIV, FIO, FOE,FTNT, GGG, HRC, INFN, KFN, LOGI, LRCX, LSI, MLNX, NOW, NXPI, ORLY, PLCM, PLXS, QDEL, QTM, RE, SCI, SGMO, SKX, SLG, SRCL, STMP, SUSQ, SWFT, SYMC, T, TAL, TCBI, TER, TEX, TMK, TQNT, TRIP, TSCO, TYL, VAR, WLL, WRE
Other…
today’s upgrades/downgrades from briefing.com
this week’s Earnings
this week’s Economic Numbers
0 thoughts on “Before the Open (Oct 23)”
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I’d be a little careful chasing the market higher here… I’d be more than that. The P/C ratio has dropped at times in recent days… When the bulls get cocky and quit buying insurance look out.
we are again at a point where the market can explode higher or crash fast
imo the nas100 rapid explosion to highs causing a bubble explosion spike if over will cause a sharp fall–it is underpreforming last 2 days as a rotation to large cap dow is being tryed
if rotation doesnt work and the weak stocks cant improve –also trouble
No panic, the traders saw that China currency was weak, and they are worried over some numbers on housing, energy etc (down). The sequestration is still in effect, that means another 6-800 billion out of the Fed govt budget this year. The spending is falling and until we can agree on a budget, it will continue. Maybe a little rocky between now and Feb ’14, but up over all probably. Keep a core position, mine is up 21% YTD, and I will own some bonds soon too, the markets are changing.