Ahead of the Bell: Dow futures are trading up 49 points and S&P futures are trading up 6 points. Investor optimism temporarily rose today boosted by M&A activity, a mixed bag of corporate earnings, and German consumer confidence, eclipsing the crisis in Ukraine. Market participants were encouraged by another round of merger announcements involving the pharmaceutical industry when Pfizer confirmed it had made an offer for AstraZeneca, while first quarter earnings thus far have been better than expected following lowered expectations. ECB President Mario Draghi, said further monetary easing in the form of bond-buying remains some way off. The IMF said it is likely to cut Russia's growth outlook for a second time after the US and the EU imposed additional sanctions on several of Vladimir Putin's allies amid escalating violence in Ukraine.
- On the economic calendartoday, S&P/Case-Shiller 20-City Home Price Index for February will be released prior to the opening bell and it is expected to be 0.7% versus 0.8% for January. Consumer confidence for April will be out after the market opens, it is forecasted to be 83.0 compared with 82.3 for March.
- The FOMC will begin its two-day meeting today and conclude on Wednesday afternoon. Policy makers are expected to leave policy rates unchanged and taper on schedule with another $10 billion reduction in bond purchases.
- Yesterday, stocks ended a split decision after reversing advances on concerns about tensions in Ukraine amid new EU sanctions against Russia offset a flurry of M&A activity.
- The dollar is down against a basket of major currencies. Gold is trading at $1,291. Crude oil is currently trading at $101 a barrel.
- On CNBC this morning, Paul Steiger, Executive Chairman of ProPublica's Board of Directors and Jeffrey Sonnenfeld, Senior Associate Dean for Executive Programs at Yale University's School of Management, talked about the past 25 years of investing and the impact of global central bank. Steiger said we are in extraordinary times as monetary policy has replaced fiscal policy. Former Fed Chairmen Alan Greenspan and Ben Bernanke, and former Treasury Secretary Hank Paulson have had a tremendous impact on monetary policy in the last 25 years. Sonnenfeld said in the last 25 years, 15 of the top 25 firms have come from the US. It tells a lot about the US entrepreneurial spirit and the energy that was unleashed in the 1980’s and 1990’s. He added the US is better than any other nation at innovating and creating, while other nations like China and Japan are great at making products.
- Have a great day!
Monday’s Close
DJIA up 87.28 pts/+0.53%/ 16,448.74
S&P up 6.03 pts/+0.32%/ 1,869.43
Nasdaq down 1.16 pts/-0.03%/ 4,074.40
Tuesday’s Futures
Dow Futures up 49.00 pts/+0.26%
S&P Futures up 6.25 pts/+0.28%
Nasdaq Futures up 16.75 pts/+0.35%
Overseas Markets
FTSE +0.71%
CAC 40 +0.42%
NIKKEI 225 -0.98%
HANG SENG +1.45%
Overseas: Global stock markets are mixed today. European markets are up on better than expected German consumer confidence data, M&A deals, and decent corporate earnings. Asian markets are mixed on concerns of a slowdown in China and worsening crisis in Ukraine.
Economic Reports: S&P Case-Shiller HPI expected to be 0.7% at 9:00 a.m. and Consumer Confidence expected to be 83.0 at 10:00 a.m.
Top Headlines:
- Reports indicate General Electric (GE) is using its US-French venture with CFM which is co-owned by GE and Snecma, a unit of French aerospace group Safran as it tries to convince French leaders to back its offer for Alstom.
- Reports suggest Allergan Inc. (AGN) after receiving an unsolicited bid from Valeant Pharmaceuticals International (VRX) is preparing to approach Irish drugmaker, Shire Plc about a potential takeover, even though Shire rebuffed a previous overture.
- El Paso Pipeline Partners LP (EPB) said it would buy natural gas assets from Kinder Morgan Inc., (KND) for about $2 billion, including $1.01 billion of debt.
Commodities/Currency:
Gold:down $8.10 to $1,291.30
Oil:up $0.55 to $101.22
EUR/USD 1.3857 +0.0006
USD/JPY 102.7150 +0.2210
GBP/USD 1.6809 +0.0001
Volatility Index (VIX): As of the close of business Monday, April 28, 2014 the VIX is up 0.08 at 13.98.
Companies Reporting Quarterly Earnings:
Merck reports Q1 adj EPS 88c, vs. Est 79c and Q1 revenue $10.26B, vs. Est $10.44B.
Parker-Hannifin reports Q3 adj EPS $1.88, vs. Est $1.62 Q3 adj EPS excludes restructuring expenses of 28c and Q3 revenue $3.36B, vs. Est $3.40B
Goodyear Tire reports Q1 adj EPS 56c, vs. Est 60c and Q1 revenue $4.47B, vs. Est $4.48B
Today’s Opening and Closing Bells:
Executives and guests of California-based Oracle Corporation (ORCL) will visit the NYSE to celebrate a product launch, EVP Systems, John Fowler will ring the Opening Bell.
Team Rubicon will visit the NYSE and ring the Closing Bell.
For daily market recaps, check out our End of Day Report every evening!
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