Day Traders Diary

7/14/16

U.S. equity futures trade higher with the S&P 500 futures trading 18 points above fair value. Futures trade on a higher note as investors weigh monetary policy decisions overseas and positive earnings results here at home. The Bank of England surprised investors this morning, voting to leave its monetary policy stance unchanged in July. The market had expected the central bank to lower its key lending rate to 25 basis points after last month's surprise Brexit vote. However, the committee did indicate that it expects monetary policy to be loosened in August.

On the home front, JPMorgan Chase (JPM 64.50, +1.34) beat analysts' estimates for the quarter, reporting that revenue rose 2.5% year-over-year. The company also reported that its loan loss reserves increased to $14.2 billion from $13.9 billion in the prior year. 

Treasuries trade on a lower note as yields rise throughout the complex. The yield on the 10-yr note has risen five basis points to 1.52%.

Today's economic data will include weekly initial claims (Briefing.com consensus 265k) and Core PPI for June (Briefing.com consensus 0.1%), which will both be released at 8:30 ET.

In U.S. corporate news of note:

JPMorgan Chase (JPM 64.50, +1.34): +2.1% after beating top- and bottom-line estimates for the quarter

Yum! Brands (YUM 89.20, +3.46): +4.0% following the company reporting above-consensus bottom-line results and raising its FY16 core operating growth forecasts

Monsanto (MON 100.15, -0.98): -1.0% amid reports that the company could acquire BASF's (BASFY 76.99, +0.00) agrochemical division

BlackRock (BLK 355.01, -2.49): -0.7% after missing bottom-line estimates while assets under management grew 4.0% year-over-year

Reviewing overnight developments:

Asia-Pacific indices ended Thursday on a mixed note with Hong Kong's Hang Seng +1.1% and Japan's Nikkei +1.0% while China's Shanghai Composite slipped 0.2%.

In economic data:

Australia's June Employment Change 7,900 (expected 10,000; previous 19,200). Unemployment Rate 5.8%, as expected (previous 5.7%), and Participation Rate ticked up to 64.9% from 64.8% (expected 64.8%)

Singapore's Q2 GDP +0.8% quarter-over-quarter (expected 0.9%; last 0.2%); +2.2% year-over-year (consensus 2.2%; last 2.1%)

India's June WPI Inflation 1.62% (expected 1.19%; previous 0.79%)

In news:

Prime Minister Shinzo Abe's advisor Koichi Hamada dampened hopes for more easing from the Bank of Japan.

The yen, meanwhile, has retreated to 105.75 per dollar

The Bank of Korea left its 7-day repurchase rate at 1.25%, as expected.

European indices trade higher with Germany's DAX +1.3%, France's CAC +1.1%, and the U.K.'s FTSE +0.1%. 

Economic data was limited:

Swiss June PPI +0.1% month-over-month (expected 0.2%; last 0.4%); -1.0% year-over-year, as expected (last -1.2%)

In news: 

The U.K.'s FTSE (+0.1%) underperforms after the Bank of England announced no changes to its policy stance.

The central bank left its key interest rate at 0.5%, maintaining the asset purchase program at GBP375 billion.

The BoE did note that most members of the Committee expect monetary policy to be loosened in August.

The pound has jumped 1.7% against the dollar to 1.3373.