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MARKET ANALYSIS: Sentiment Upbeat Amid Expectations Of Benevolent Central Bank Stance(Alliance News Via Acquire Media NewsEdge) WASHINGTON (Alliance News) - The major US index futures are pointing to a higher opening on Tuesday, with sentiment suggesting that stocks may move higher at the open. Among the domestic catalysts, earnings have largely been mixed and durable goods orders data for September came in weaker than expected. Meanwhile, the mood across the Atlantic I buoyant amid a bigger than expected rate cut by Swedish central bank, the Riksbank. The domestic markets are also likely to take cues from a consumer confidence data due shortly after the markets open. US stocks ended a lackluster session on Monday on a narrowly mixed note, as lukewarm housing data and apprehension ahead of the FOMC meeting led to choppy trading. The major averages opened lower but cut their losses in early trading. However, the averages continued to trade in a lackluster manner before closing mixed. The Dow Industrials ended up 12.53 points or 0.07% at 16,818 and the Nasdaq Composite Index added 2.22 points or 0.05% before closing at 4,486, while the S&P 500 Index ended at 1,962, down 2.95 points or 0.15%. The breadth among the Dow component was even, with 15 stocks closing higher, while the remaining 15 stocks retreated. Travelers (TRV) and Verizon (VZ) led the gains. On the other hand, Merck (MRK) slid 2.01% in reaction to its financial results and DuPont (DD) shed 1.62%. Among the sectors, airline and biotechnology stocks gained ground, while resource stocks came under selling pressure. On the economic front, the National Association of Realtors reported that pending home sales edged up 0.3% month-over-month in September, a smaller than expected increase. Pending home sales in the Northeast and the South rose, while pending sales in the Midwest and West were down. The results of Markit's preliminary service sector survey showed that the sector expanded at a slower than expected pace. The service sector purchasing managers' index based on the survey fell to 57.3 in October from 58.9 in September. Currency, Commodity Markets Crude oil futures are climbing USD0.44 to USD81.44 a barrel after edging down USD0.01 to USD81 a barrel in the previous session. The commodity had slid more than USD1.50 a barrel in intraday trading on Monday on worries concerning a supply glut. Meanwhile, gold futures are rising USD430 to USD1,23360 an ounce. On Monday, gold fell USD2.50 to USD1,229.30 an ounce. Among currencies, the US dollar is trading at 10784 yen compared to the 107.82 yen it fetched at the close of New York trading on Monday. Against the euro, the dollar is trading at USD1.2746 compared to yesterday's USD1.2698. Asia The major Asian markets closed mixed yet again, with the Japanese, Australian, South Korean, Indonesian and Singaporean markets retreating, while the rest of the major markets ended higher. With the mood on Wall Street turning lackluster overnight, risk aversion kicked in even as the Chinese and Hong Kong markets advanced solidly amid expectations that the government will infuse stimulus into the system to reinvigorate slowing growth. The Japanese market ended lower amid risk aversion, which perked up demand for the safe haven yen. The Nikkei 225 average languished below the unchanged line throughout the session before closing down 58.81 points or 0.38% at 15,330. Export, resource, construction, real estate and telecom stocks moved to the downside, while financial and utility stocks gained some ground. Australia's All Ordinaries opened lower and declined steadily till early afternoon trading. After moving sideways, the index recouped some of its losses in the afternoon yet closed down 7.90 points or 0.15% at 5,434. Material and energy stocks fell the most and utility stocks also came under selling pressure, while financial and healthcare stocks moved to the upside. Meanwhile, Hong Kong's Hang Seng ended at 23,520, up 377.13 points or 1.63%, and China's Shanghai Composite Index closed 47.43 points or 2.07% higher at 2,338. On the economic front, a report released by the Japanese Ministry of Economy, Trade and Industry showed that retail sales in Japan climbed 2.3% year-over-year in September, a bigger increase than the 0.8% growth expected by economists. China's National Bureau of Statistics reported that industrial profits rose 0.4% year-over-year in September compared to a 0.6% drop in August. For the year-to-date period, industrial profits were 7.9% higher. Europe European stocks opened notably higher, and after retracing some of their gains in early trading, they have resumed climbing. The mood has been cautious in the absence of any major domestic economic data and in anticipation of the FOMC decision on Wednesday. Earnings released from the region have been mixed. In corporate news, UBS (UBS) reported higher third quarter earnings, which were still smaller than expectations, as it had to set aside USD1.9 billion as reserves for legal costs. Standard Chartered's results also reflected a hit from restructuring charges, which pushed third quarter profits lower. UK's Lloyds Banking Group reversed to a profit on a pre-tax basis in the nine-month period ended September and also revealed plans to eliminate 9,000 jobs and close 200 branches to cut costs. Sanofi's (SNY) reported a small decline in its fourth quarter profits, while Novartis (NVS) reported a strong increase in its third quarter profits. Dutch telecom company KPN reported a decline in its third quarter earnings, although the decline was in line with expectations. BP's (BP) third quarter underlying replacement cost profit came roughly in line with expectations despite declining year-over-year. The company also announced an increase in its third quarter dividend. BG Group's third quarter profit also declined from last year. On the economic front, German import prices continued to decline in September, according to a report released by the German Federal Statistical Office. Import prices were down 1.6% year-over-year in September following the 1.9% drop in August. Meanwhile, export prices edged up 0.1%. On a monthly basis, import and export prices were up 0.3% and 0.2%. US Economic Reports The Federal Open Market Committee, the monetary policy-setting arm of the Federal Reserve, is set to begin its two-day monetary policy meeting. New orders for US manufactured durable goods unexpectedly showed a notable decrease in the month of September, according to a report released by the Commerce Department, with orders extending the steep drop seen in August. The report said durable goods orders fell by 1.3% in September after plunging by 18.3% in August. The continued decrease came as a surprise to economists, who had expected orders to increase by about 0.5%. Excluding orders for transportation equipment, durable goods orders fell by a more modest 0.2% in September compared to a 0.7% increase in the previous month. Economists had also expected ex-transportation orders to climb by 0.5%. Standard & Poor's is due to release the results of its house price survey for August at 9 am ET. The 20-city composite house price index is expected to have risen a seasonally adjusted 0.1% month-over-month. Annually, prices may have risen an unadjusted 5.8%. The Conference Board will release its US consumer confidence index for October at 10 am ET. Economists expect the index to rise to 86.8 from 86 in September. The consumer confidence index unexpectedly fell to 86 in September from 93.4 in August. The expectations index fell about 10 points, and the present situation index declined by 4.5 points. The results of the Richmond Federal Reserve's manufacturing survey due to be released at 10 am ET are expected to show a decline in the regional manufacturing index to 10 in October from 12 in September. The Treasury Department is set to announce the results of its auction of USD29 billion worth of 2-year notes at 1 pm ET. Stocks in Focus Amgen (AMGN) reported better than expected third quarter results and also raised its guidance for 2014. PMC-Sierra's (PMCS) third quarter results were also ahead of expectations. Aetna (AET) also reported better than expected third quarter results and raised its operating earnings per share guidance for the full year. DuPont's (DD) third quarter earnings exceeded estimates, while its revenues missed expectations. The company's fourth quarter earnings guidance was roughly in line with estimates. Pfizer (PFE) reported third quarter results that exceeded expectations and it narrowed its guidance for 2014 Starwood Hotels' (HOT) third quarter earnings beat estimate, while its revenues were below expectations. The company's full year earnings guidance was weak. Sanmina (SANM) reported fourth quarter adjusted earnings and revenues that were ahead of expectations. The company's first quarter guidance was also above estimates. Insurer's Hartford Financial (HIG) and XL Group (XL) reported better than expected third quarter operating earnings and revenues. Manitowoc (MTW) reported third quarter results that fell below expectations but confirmed its outlook for the year. Meanwhile, Crane's (CR) third quarter results trailed expectations and it lowered its 2014 guidance. Owens & Minor (OMI) reported below consensus adjusted earnings for its third quarter, while its revenues exceeded estimates. DDR (DDR) reported third quarter operating funds from operations and revenues that trailed expectations. Standard & Poor's announced that Keysight Technologies (KEYSwi), a spin-off of Agilent (A), will replace Universal (UVV) in the S&P MidCap 400 Index and Universal will replace Rubicon Technology (RBCN) in the S&P SmallCap 600 Index. Halyard Health (HYHwi), a spin-off unit of Kimberly-Clark (KMB), will replace ADTRAN (ADTN) in the S&P MidCap 400 Index and ADTRAN will replace Forest Oil (FST) in the S&P SmallCap 600 Index. Ameriprise Financial (AMP), Arthur Gallagher (AJG), Boston Properties (BXP), C.H. Robinson (CHRW), Cray (CRAY), Electronic Arts (EA), Express Scripts (ESRX), Facebook (FB), Gilead Sciences (GILD), Marriott (MAR), Owens-Illinois (OI), Panera Bread (PNRA), US Steel (X), Western Digital (WDC) and Wynn Resorts (WYNN) are among the companies due to release their quarterly results after the close of trading. Copyright RTT News/dpa-AFX |