Before the Open (Jul 14)

Good morning. Happy Tuesday.
The Asian/Pacific markets closed mixed. Japan and Australia gained more than 1%; New Zealand also did well. China dropped 1.2%. Europe is currently mixed, and only Portugal (down 1.2%) has moved more than 1%. Italy is also weak, but otherwise it’s a quiet day across the pond. Futures here in the States point towards a flat open for the cash market.
VIDEO: State of the Market
The dollar is down. Oil is flat, copper is down. Gold and silver are down. Bonds are mixed.
Today’s big news comes from Iran, where major world powers have agreed on a nuclear deal. The goal was to curb Iran’s nuclear program in exchange for easing sanctions, which will enable the country to export more oil, access international finance and open the doors to investors. Oil was down as much as $1.50 overnight but in the last two hours has rallied back to break even. If oil can post a gain in the face of this news (more oil supply is going to hit the market), a short term bottom is likely in place.
Yesterday the market followed through on Friday’s big rally to complete its biggest 2-day run in a long time. The S&P is now more than 50 points off its low. Things happen quickly. You know this. A quick glance at the last several months tells you bottoms form in a couple days, and if you wait for confirmation, you miss trades.
Now the market is sitting near the midpoint of its range, so nothing is imminent. The bulls could push prices higher; the bears could push them lower. In the very near term it doesn’t matter; nobody has their back against the wall.
Several indicators moved to extreme levels and then reversed, so there’s support for a rally. It could go for a week or a month. The indicators along with the market’s reaction to news will tell us.
Bias remains to the upside. More after the open.
Stock headlines from barchart.com…
JPMorgan Chase (JPM +1.55%) reported Q2 EPS of $1.49, better than expectations of $1.45.
Fastenal (FAST +1.16%) reported Q2 EPS of 48 cents, higher than consensus of 47 cents.
Orbitz (OWW unch) was downgraded to ‘Sell’ from ‘Neutral’ at UBS.
Western Refining (WNR +1.57%) was upgraded to ‘Neutral’ from ‘Sell’ at Goldman Sachs.
Delek U.S. (DK -0.03%) was upgraded to ‘Buy’ from ‘Neutral’ at Goldman Sachs.
Phillips 66 (PSX +2.37%) was downgraded to ‘Neutral’ from ‘Buy’ at Goldman Sachs.
Coca-Cola (KO +0.67%) was upgraded to ‘Buy’ from ‘Neutral’ at UBS.
Cardinal Health (CAH +0.75%) was downgraded to ‘Hold’ from ‘Buy’ at Evercore ISI.
Amazon.com (AMZN +2.72%) was upgraded to ‘Buy’ from ‘Neutral’ at UBS.
Buffalo Wild Wings (BWLD +2.05%) was upgraded to ‘Outperform’ from ‘Market Perform’ at Raymond James.
GoPro (GPRO -0.76%) was upgraded to ‘Overweight’ from ‘Equal Weight’ at Barclays.
Micron Technology (MU +0.23%) jumped nearly 9% in pre-market trading after people familiar with the matter said that China’s Tsinghua Unigroup Ltd, plans to offer $23 billion for the chipmaker.
Navient (NAVI -0.05%) slid over 10% in after-hours trading after it lowered guidance on fiscal 2015 core EPS to $1.85, well below consensus of $2.20.
Candlewood Investment Group reported a 17.9% passive stake in Pacific Ethanol (PEIX +1.39%).
Earnings and Economic Numbers from seekingalpha.com…
Today’s economic calendar:
6:00 NFIB Small Business Optimism Index
8:30 Retail Sales
8:30 Import/Export Prices
8:55 Redbook Chain Store Sales
10:00 Business Inventories
8:15 PM Fed’s George: Monetary policy and Economic outlook
Notable earnings before today’s open: AIR, CBSH, FAST, JNJ, JPM, WFC
Notable earnings after today’s close: ADTN, CSX, PPHM, YUM
Other…
today’s upgrades/downgrades from briefing.com
this week’s Earnings
this week’s Economic Numbers