TradeTheNews.com WeeklyMarket
Update: Markets Mixed, Treasury Yields Probe Highs, Ahead of FedTestimony Next
Week
Fri, 23 Feb 2018 16:03 PM EST
The holiday shortened trading week was largely uneventful in terms of major
market moving headlines.Investors did return to find volatility holding near
the higher levels seen over the last month. Intraday swings of 100 points or
more in the Dow continued, though volumes retreated back to more normal levels
and indices largely moved sideways. Earnings season wound down with retailers
taking center stage, and overall the positive tone from executives extended
despite a few key misses. The US 10-year yield hit a 4-year high above 2.94%
after the release of Wednesday’s FOMC minutes led to speculation about the tone
Fed Chair Powell may take when he testifies on Capitol Hill early next week.
The Greenback bounced, garnering modest momentum when stocks sold off midweek,
and then ebbed when equity buyers reemerged on Friday.
In corporate news thisweek, Rite-Aid announced it would merge with Albertsons
in a cash-and-stockdeal, aiming to deliver $375M in cost synergies. Qualcomm
raised its offer forNXP Semiconductor to $127.50/share, which caused Broadcom
to lower its Qualcommoffer to $79/share if the higher bid goes through. Blue
Buffalo confirmed itwould be acquired by General Mills for $40/share in an $8B
deal in whichGeneral Mills would be paying 22x EBITDA for the natural pet food
company.China's Geely disclosed a 9.7% stake in Daimler worth around $9B,
making Geely’sChairman Li Shufu the biggest Daimler shareholder. Walmart
weighed on the Dow,falling more than 9% following a disappointing earnings
report with lowered revenueguidance early in the week. For the week the
DJIA gained 0.4%, the S&P500added 0.6%, and the Nasdaq rose 1.4%.
MONDAY 2/19
(EU) Spanish EconomyMinister de Guindos chosen as ECB vice president to succeed
Vitor Constancio;effective in May - financial press
(HK) Macau Feb 19thGolden Week visitors from China +12.3% y/y
HSBA.UK Reports FY17 Adjpretax $20.99B v $19.3B y/y, Adj Rev $51.5B v $50.2B
y/y; To issue $5.0-7.0B intier 1 capital in H1
TUESDAY 2/20
BHP.AU Reports H1 Net$2.0B v $3.2B y/y; underlying Pretax $4.05B v $3.24B y/y,
Rev $21.78B v $18.8By/y
(DE) GERMAN FEB ZEWCURRENT SITUATION SURVEY: 92.3 V 93.9E; EXPECTATIONS SURVEY:
17.8 V 16.0E
HD Reports Q4 adj $1.69v $1.62e, Rev $23.9B v $23.7Be; Raises Quarterly
dividend 15.7% to $1.03 from$0.89 (indicated yield 2.2%)
RAD Confirms merger withAlbertsons in cash and stock deal; To deliver $375M in
cost synergies
(HK) Macau Feb 20thGolden Week visitors from China +6.5% y/y
WEDNESDAY 2/21
ORA.FR Reports FY17EBITDA €12.8B v €12.8Be, Rev €41.1B v €41.1Be
LLOY.UK Reports Q4 PBT£780M v £877Me, Underlying Profit £1.93B v £1.79B y/y,
Total Income £4.63B v£4.35B y/y; announces strategic update and £1B buyback, to
invest £3B instrategy
(FR) FRANCE FEB PRELIMINARYMANUFACTURING PMI: 56.1 V 58.0E (17th month of
expansion)
(DE) GERMANY FEBPRELIMINARY MANUFACTURING PMI: 60.3 V 60.5E (38th month of
expansion)
(EU) EURO ZONE FEBPRELIMINARY MANUFACTURING PMI: 58.5 V 59.2E (55th month of
expansion)
(UK) DEC AVERAGE WEEKLYEARNINGS 3M/Y: 2.5% V 2.5%E; WEEKLY EARNINGS (EX BONUS)
3M/Y: 2.5% V 2.4%E
*(UK) JAN JOBLESS CLAIMSCHANGE: -7.2K V +6.2K PRIOR; CLAIMANT COUNT RATE: 2.3%
V 2.4% PRIOR
*(UK) DEC ILOUNEMPLOYMENT RATE: 4.4% V 4.3%E
SLCA Reports Q4 $0.52 v$0.55e, Rev $360.6M v $360Me; See's February pickup in
business activity
(US) President Trumpsaid to be open on raising the purchase age for some guns -
financial press
(US) Association ofAmerican Railroads weekly rail traffic report for week
ending Feb 17th: 540Kcarloads and intermodal units, +3.1% y/y
(CN) According to ChinaNational Tourism Administration (CNTA) Lunar New year
tourism totaled CNY475B,+12.6% y/y - Xinhua
THURSDAY 2/22
DTE.DE Reports Q4 adjNet +€1.3B v -€2.1B y/y, adj EBITDA €5.0B v €5.3Be, Rev
€19.2B v €19.2Be
BARC.UK Reports Q4 Net-£1.29B v +£99M y/y, adj Pretax £93M v £330M y/y, Core
Net Rev £5.02B v £4.99By/y
BA.UK Reports FY17 EPS43.5p v 42.3pe, adj EBITA £2.03B v £2.0Be, Rev £19.6B v
£19.5Be
*(FR) FRANCE FEBBUSINESS CONFIDENCE: 109 V 110E; MANUFACTURING CONFIDENCE: 112
V 113E
(DE) GERMAN FEB IFOBUSINESS CLIMATE: 115.4 V 117.0E; CURRENT ASSESSMENT: 126.3
V 127.0E
(UK) Q4 PRELIMINARY GDPQ/Q: 0.4% V 0.5%E; Y/Y: 1.4% V 1.5%E (slowest annual
pace since 2012)
*(EU) ECB ACCOUNT OF THEMONETARY POLICY MEETING (JAN MINUTES): Broadly agree
that policy stance wasappropriate; premature to alter policy mix
(JP) JAPAN JAN NATIONALCPI Y/Y: 1.4% V 1.3%E (Highest since March 2015*); CPI
EX-FRESH FOOD (CORE)Y/Y: 0.9% V 0.8%E
(US) US Treasury SecMnuchin: President Trump's policies will raise wages
without inflation
FRIDAY 2/23
(DE) GERMANY Q4 FINALGDP Q/Q: 0.6% V 0.6%E; Y/Y: 2.9% V 2.9%E; GDP NSA Y/Y:
2.3% V 2.3%E
RBS.UK Reports Q4 Net-£579M v -£4.44B y/y, Adj Op £512M v £1.25B y/y, Rev
£3.06B v £3.22B y/y;Affirms Medium-term outlook
VOW3.DE Reports prelimFY17 net €11.4B, adj op profit €17.0B v €17.3Be, Rev
€230.7B v €231Be
DAI.DE China's Geelyreportedly building nearly 10% stake in Daimler worth $9B -
press
(US) Weekly Baker HughesUS Rig Count: 978 v 975 w/w (+0.3%)
