Before the Open (May 19)

Good morning. Happy Thursday.
The Asian/Pacific markets are down across-the-board. Singapore, India and New Zealand are down more than 1%; Hong Kong, Australia, Indonesia, South Korea and Taiwan are also weak. Europe is currently mostly down. London, Norway and Poland are down more than 1%; Germany, Austria, the Netherlands, Russia, Greece and Finland are also weak. Futures here in the States point towards a down open for the cash market (S&P down 3).
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I wrote an article for Top Shelf Traders emagazine. You can check it out here. I consider it very important. It’s at the heart of what I do.
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The dollar, which jumped after the FOMC minutes were released yesterday, is up. Oil and copper are down. Gold and silver are down. Bonds are up.
Yesterday Wall St was reminded the Fed still had intentions of raising rates this year – something it already knew but decided to brush off lately – and they immediately panicked. Most stocks too quick hits. Commodities were especially weak, the dollar jumped and financials rallied.
I didn’t see anything in the minutes that the Fed hadn’t already communicated. Perhaps it seemed more real. The Fed said way back in December they intended on raising 3-4 times this year, but each meeting came and went without a change. Wall St was lulled to sleep, so yesterday’s minutes – even though no new information was revealed – woke them up.
I’m not going to enter the debate as to whether they should or should not raise at the June meeting, but I will say they were stupid not to raise last meeting. The S&P was within a couple percent of its all-time high – perfect time to raise. I said back then, and I’ll say it again, if they really did wanted to raise, they should have taken advantage of the opportunity. What if the market drops (it is one of their data points, even though they won’t admit it)? Are they are going to raise if the market is trending down? Will they have to raise because of the comments they’ve made?
The bulls have their backs against the wall. They must dig in and defend or else we’re likely to get a mini move down. More after the open.
Stock headlines from barchart.com…
L Brands (LB -2.43%) dropped over 5% in pre-market trading after it lowered guidance on full-year adjusted EPS to $3.60-$3.80 from a previous estimate of $3.90-$4.10.
Monsanto (MON -0.60%) jumped 8% in pre-market trading after it said it received an unsolicited acquisition offer from Bayer AG.
FMC Technologies (FTI -2.25%) climbed 3% in pre-market trading after it agreed to merge with Technip SA.
Cisco Systems (CSCO +0.26%) rallied over 6% in after-hours trading after it reported Q3 adjusted EPS of 57 cents, higher than consensus of 55 cents, and said it sees Q3 adjusted EPS of 59 cents-61 cents, above consensus of 58 cents.
LKQ Corp. (LKQ -0.59%) climbed over 1% in after-hours trading when it was announced that it will replace Airgas in the S&P 500 after the close of trading on Friday, May 20.
Medical Properties Trust (MPW -2.69%) rose over 3% in after-hours trading when it was announced that it will replace LKQ Corp. in the S&P Midcap 400.
Tesla Motors (TSLA +3.18%) fell over 3% in after-hours trading after it said started a $2 billion secondary stock offering.
Salesforce.com (CRM +1.43%) rallied nearly 6% in after-hours trading after it reported Q1 adjusted EPS of 24 cents, above consensus of 23 cents, and then raised guidance on fiscal 2017 adjusted EPS to $1-00-$1.02 from a prior view of 99 cents-$1.01.
Marathon Petroleum (MPC +1.86%) was rated a new ‘Sell’ at UBS.
Urban Outfitters (URBN -3.34%) rose nearly 4% in after-hours trading after it reported Q1 revenue of $762.6 million, higher than consensus of $758.9 million.
Flowers Foods (FLO -2.96%) slipped 2% in after-hours trading after it reported Q1 EPS of 28 cents, below consensus of 29 cents.
American Eagle Outfitters (AEO -3.39%) jumped over 13% in after-hours trading after it reported Q1 adjusted EPS of 22 cents, better than consensus of 18 cents.
ZIOPHARM Oncology (ZIOP +4.79%) jumped over 6% in after-hours trading after it said its gene therapy product Ad-RTS-hIL-12+veledimex showed “encouraging signs of immune activation” in a Phase 1 study of patients with recurrent of progressive brain cancer.
Repros Therapeutics (RPRX -3.15%) surged over 20% in after-hours trading after its dosage of Proellex met its primary endpoint in a Phase 2b study of women with severe menstrual bleeding due to uterine fibroids.
Wednesday’s Key Earnings
Cisco (NASDAQ:CSCO) +4.8% AH topping estimates, solid guidance.
Lowe’s (NYSE:LOW) +3.3% following a comparable-store sales boost.
Salesforce (NYSE:CRM) +6.1% AH on strong growth, upbeat forecast.
Staples (NASDAQ:SPLS) -0.5% as sales dropped 1.2% in Q1.
Target (NYSE:TGT) -7.6% stung by low traffic, weak outlook.
Today’s Economic Calendar
8:30 Initial Jobless Claims
8:30 Philly Fed Business Outlook
8:30 Chicago Fed National Activity Index
9:45 Bloomberg Consumer Comfort Index
10:00 Leading Indicators
10:30 EIA Natural Gas Inventory
10:30 Fed’s Williams Speech
4:30 PM Money Supply
4:30 PM Fed Balance Sheet
Today’s Earnings here
Other…
today’s upgrades/downgrades from briefing.com
this week’s Earnings
this week’s Economic Numbers