Futures lower on Chinese fears

Data released over the weekend spooked investors and sent shares down.

By Benzinga Jul 29, 2013 8:23AM

zurbar age fotostockBy Matthew Kanterman


U.S. equity futures were slightly lower in early premarket trade after Asian shares finished Monday with declines on fears of a protracted slowdown in China. Data released over the weekend spooked investors.


The National Bureau of Statistics in Beijing reported that industrial profits rose 6.3% in June from June of last year, well below May's rate of 15.5%. The slowdown in growth partially reflects the liquidity crunch that hit the country in June.


In Japan, too, June retail sales missed expectations sharply. Retail sales fell 0.2% in June from May compared to the expected gain of 0.8%.


A poll out of Germany this weekend compiled by Emnid revealed that German Chancellor Angela Merkel may be losing her majority in the upcoming parliamentary elections. With elections in September a major risk event for the eurozone, Merkel's party slipped below the opposition in this poll. However, accounting for errors in surveying, the data basically show a dead heat.

  • S&P 500 futures fell 2.5 points to 1,684.10.

  • The EUR/USD was higher at 1.3288.

  • Spanish 10-year government bond yields fell 1 basis point to 4.61%.

  • Italian 10-year government bond yields fell 1 basis point to 4.39%.

  • Gold rose 0.65% to $1,330.50 per ounce.

Asian markets

Asian shares were mostly lower overnight on the back of the weak economic data from China and Japan. The Japanese Nikkei 225 Index declined 3.32% and the Topix Index fell 2.61%. In Hong Kong, the Hang Seng Index declined 0.41% while the Shanghai Composite Index slipped 1.57% in China. Also, the Korean Kospi fell 0.57% and Australian shares shed 0.07%.


European markets

European shares were mostly higher in early trade save for Germany following the poll results. The Spanish Ibex Index rose 0.86% while the Italian FTSE MIB Index fell 0.06%. Meanwhile, the German DAX declined 0.65% while the French CAC 40 Index gained 0.32% and U.K. shares rose 0.4%.


Commodities

Commodities were mixed overnight but had a negative tilt on growth fears out of China. WTI crude futures fell 0.37% to $104.31 per barrel and Brent crude futures fell 0.01% to $107.16 per barrel. Copper futures fell 0.27% to $309.70 per pound. Gold was higher and silver futures fell 0.03% to $19.77 per ounce.


Currencies

Currency markets were rather quiet overnight as the dollar weakened. The EUR/USD was higher at 1.3288 and the dollar fell against the yen to 97.88. Overall, the Dollar Index fell 0.14% on weakness against the yen, the pound, the euro, and the Swiss franc.


Earnings reported Friday

Key companies that reported earnings Friday include:

  • AbbVie (ABBV) reported second quarter earnings per share of $0.82 vs. $0.79 a year ago on revenue of $4.69 billion vs. $4.54 billion expected.

  • Newmont Mining (NEM) reported second quarter earnings per share of $0.59 vs. $0.42 a year ago on revenue of $2.00 billion vs. $2.08 billion ayear ago.

  • Stanley Black & Decker (SWK) reported second quarter earnings per share of $1.21 vs. $1.19 a year ago on revenue of $2.87 billion vs. $2.81 billion a year ago.

  • Lear (LEA) reported second quarter earnings per share of $1.62 vs. $1.37 a year ago on revenue of $4.1 billion vs. $3.91 billion a year ago.

Premarket movers

Stocks moving in the premarket included:

  • Perrigo (PRGO) shares rose 0.71% as Bloomberg reported that the company is close to a deal for Elan (ELN). Elan rose 10.65% premarket.

  • Saks (SKS) shares rose 4.83% premarket after the New York Post reported that Lord & Taylor owner Hudson's Bay Co. (CA:HBC) is set to buy Saks for between $17-$18 per share.

Earnings

Notable companies expected to report earnings Monday include:

  • Express Scripts Holdings (ESRX) is expected to report second quarter earnings per share of $1.10 vs. $0.88 a year ago on revenue of $25.52 billion vs. $27.69 billion a year ago.

  • Anadarko Petroleum (APC) is expected to report second quarter earnings per share of $0.91 vs. $0.85 a year ago on revenue of $3.57 billion vs. $3.22 billion a year ago.

  • Caesars Entertainment (CZR) is expected to report a second quarter loss of $1.57 vs. a loss of $1.93 a year ago on revenue of $2.18 billion vs. $2.17 billion a year ago.

  • Simon Property Group (SPG) is expected to report second quarter earnings per share of $2.07 vs. $1.89 a year ago on revenue of $1.24 billion vs. $1.19 billion a year ago.

  • Herbalife (HLF) is expected to report second quarter earnings per share of $1.18 vs. $1.10 a year ago on revenue of $1.16 billion vs. $1.03 billion a year ago.

Economics

On the economics calendar Monday, pending home sales are due out ahead of the Dallas Fed manufacturing survey and the weekly 3- and 6-month bill auctions. Overnight, Reserve Bank of Australia Governor Glenn Stevens is set to speak and the Spanish GDP report is due out.


More from Benzinga

2Comments
Jul 29, 2013 9:01AM
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This notion that the United States Economy is immune in spite of our Massive National Debt as Uncle Ben prints to infinity is pure insanity. Fears about China and Japan, how about showing some concerns about our own problems growing out of Control.
Jul 29, 2013 8:58AM
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The Global Feds are feeding everyone pure unmitigated BS that it's a Free Ride to prosperity by Printing Huge Sums of Money. What they are NOT telling everyone is that the Free Ride is designed just for the Rich and the Elite to benefit. The rest of us can go straight to hell as far as they are concerned. First they left us just the crumbs, now they are even taking that.
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