Futures slightly higher on yen weakness
US markets seem set to finish this strong week on a higher note as the Japanese currency slumps to 4.5 year low.
U.S. equity futures rose slightly in early premarket trade although the focus was on the yen. The yen continued to weaken against the dollar overnight as the USD/JPY rose above 101 on new reports that Japanese citizens are starting to buy foreign assets, a key sign the yen devaluation is working and is sustainable.
In other news, Germany's March trade balance was reported as better than expected at 17.6 billion euros vs. the forecast of 16.5 billion euros. However, the data represent a drop from February's upwardly revised 17.7 billion euros.
An investor group led by Carl Icahn and Southeastern Asset Management are offering an alternative buyout solution to Dell (DELL). The two are offering $12 per share to current investors with an option to keep their stock.
Bloomberg reported overnight that Yahoo (YHOO) is looking to buy Hulu to add video services to its platform.
S&P 500 futures rose 1.7 points to 1,626.30.
The EUR/USD was lower at 1.3012.
Spanish 10-year government bond yields fell 2 basis points to 4.17%.
Italian 10-year government bond yields fell 3 basis points to 3.85%.
Gold fell 1.37% to $1,448.50 per ounce.
Asian shares were higher led by Japanese stocks as the yen continued to weaken, boosting hopes that Japan's easing efforts will work. The Japanese Nikkei Index rose 2.93% and the Shanghai Composite Index rose 0.62% while the Hang Seng Index gained 0.47%. Also, the Korean Kospi fell 1.75% and Australian shares gained 0.15%.
European shares were also higher overnight on the back of Asian strength. The Spanish Ibex Index rose 0.34% and the Italian FTSE MIB Index rose 1.23%. Meanwhile, the German DAX gained 0.53% and the French CAC 40 added 0.51% while U.K. shares gained 0.34%.
Commodities were lower overnight with the key theme being dollar strength weighing on commodities broadly. WTI crude futures fell 0.73% to $95.69 per barrel and Brent crude futures fell 0.44% to $104.01 per barrel. Copper futures rose marginally by 0.04% to $334.20 per pound. Gold was lower and silver futures fell 1.13% to $23.64 per ounce.
Currency markets showed broad dollar strength overnight, not just against the yen, as dollar strength continued as the major theme from Thursday's trading. The EUR/USD was lower at 1.3012 and the dollar rose against the yen to 101.24. Overall, the Dollar Index rose 0.18% on strength against the yen, the Swiss franc, the pound, the euro, and the Canadian dollar.
Earnings reported Thursday
Key companies that reported earnings Thursday include:
Priceline.com (PCLN) reported first quarter earnings per share of $5.76 vs. $5.27 expected. However, the company slashed second quarter guidance to $8.87-$9.45 earnings per share vs. the forecast of $9.58 per share.
Nvidia (NVDA) reported first quarter earnings per share of $0.18 vs. $0.15 on revenue of $954.7 million vs. $940.7 million expected.
Apache (APA) reported first quarter earnings per share of $2.02 vs. $2.21 expected and announced a 30 million share buyback program.
Stocks moving in the premarket included:
Priceline.com (PCLN) shares fell 2.73% premarket on the guidance cut.
Dell (DELL) shares rose 1.5% premarket on the Icahn news.
J.P. Morgan Chase (JPM) shares declined 1.04% premarket after the state of California accused the company of illegal debt collection practices.
Gap (GPS) shares rose 7.19% premarket after the company reported strong April same-store-sales and raised first quarter earnings per share guidance to $0.68-$0.69 vs. the forecast of $0.56.
Notable companies expected to report earnings Friday include:
Horizon Pharmaceuticals (HZNP) is expected to report a first quarter loss of $0.35 per share vs. a loss of $0.98 per share a year ago.
Sketchers (SKX) is expected to report first quarter earnings per share of $0.19 vs. a loss of $0.07 per share a year ago.
ArcelorMittal (MT) is expected to report a first quarter loss of $0.05 vs. earnings per share of $0.01 a year ago.
Silver Wheaton (SLW) is expected to report first quarter earnings per share of $0.40 vs. $0.41 a year ago.
On the economics calendar Friday, Chicago Federal Reserve President Charles Evans and Fed Chairman Ben Bernanke are set to speak followed by Kansas City Fed President Esther George. In addition, the Canadian employment report and the ECRI Weekly report are due out. Early Monday, Chinese fixed asset investment, industrial production, and retail sales are all due out.
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