Feb 17, 2017 - Market Update

Short recap

Asian stocks pausing

Samsung VP in custody over bribery, shares down only 1% as the company has good track record in coming back from troubles

Oil found support in talks about OPEC extending its production cut (now 6 month only)

ECB Minutes showing possibility of capital key adjustments what benefits peripherals a lot

French yields lower after seeing huge demand for 2028 bond issue yesterday

Trump at the end of his marketing cycle, starting campaigning again over the weekend

Ryan (speaker of the House of Representatives) having troubles to push tax reform to republicans

Trump at joint-session of Congress on Feb 28 presenting his agenda, looking at cutting corporate tax to 15% but Republicans resistant and open to 25% only as their fear of increasing the debt ceiling again what will have implications on US credit rating

No clear expectations of his agenda for now, either he disappoints or makes it

Allianz ready for buy backs worth of EUR 3 bln and adjusting budget for takeover activities

Deutsche Boerse – LSE acquisition process spiced up by allegation of DB CEO from insider trading

Snap IPO – owner of Snapchat to start investor roadshow on Monday, lowering target valuation of the company

Germany supports Peugeot-Citroen takeover of Opel/Vauxhall on no planned job cuts or factory closings

JP Morgan, BoAML, Citigroup proposing publicly to easy anti-money laundering rules as they are ineffective

Blackstone buying Cloudreach that is active in cloud computing business

OpenFin (financial software developer) raising USD 15 mln from JP Morgan, DRW Trading group (high-speed trading firm) and NEX Group (interdealer broker)

Saturday, US VP Mike Pence to reassure allies in Europe and polish the wording Trump is using towards NATO and Russia

Data

Feb 20 – EZ FinMin meeting on Greece

Feb 28 – Trump at Congress (US stock investors should get ready for a correction if Trump disappoints; on the other hand they are still likely to find a pro-growth solution)

Mar 15 – FOMC

Mar 17-18 – G10 FinMin and central bankers meeting (right after FOMC)

…the period between Fed 28-Mar 15 would be interesting as Trump believes in weaker USD

EURSEK – seems to be heavy after Riksbank not delivering

Waiting for CPI

Good luck Champs!

Mr Hawk

DISCLAIMER: This material was created for informational purposes only and represents the Land of Trading team’s view of the past and current economic and capital market environment. It is not an investment advice and should not be viewed that way at all, and the creators of this material cannot be held liable for any potential losses resulting from trading, where despite this disclaimer someone would consider this material as an investment advice. All rights reserved ©2016. Contact: landoftradingATgmailDOTcom

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Stocks - Q2 Earnings Note

Q2 Earnings

Traditionally, Alcoa starts on Monday after market, followed by other important names later this week. Estimated EPS 0.09 and -51.1 Y/Y, Revenue 5.271.

Yum! Brands reporting on Wednesday (estimated EPS 0.74 and 7.2 Y/Y, Revenue 2.695).

CSX Corp reporting on Wednesday after market (estimated EPS 0.44 and -20.9 Y/Y, Revenue 3.099).

Delta Airlines reporting on Thursday (estimated EPS 1.48 and 16.5 Y/Y, Revenue 10.499). Suffered from higher oil prices but check the valuation multiples, as their levels may be interesting. Also weekly chart worth of being reviewed.

BlackRock reporting on Thursday before market (estimated EPS 4.8 and -3.3 Y/Y, Revenue 2.791). The results with company guidance can shed some light on how the shift from active fund management of mutual & hedge funds to passive vehicles like ETFs or managed ETF portfolios impacts the entire wealth management sector. As Fintech is biting more and more, many wealth managers are looking at cheaper options for their clients, as some active asset managers struggle to generate enough alpha to justify their fees.

US Bancorp reporting on Friday before market (estimated EPS 0.81 and 0.8 Y/Y, Revenue 5.196)

…but those of high importance are:

JPMorgan Chase Inc reporting on Thursday (estimated EPS 1.44 and -3.7 Y/Y, Revenue 24.416). Not only earnings will be reviewed but also the impact of Brexit vote, as they have substantial operations in UK (most employees from all US banks present in UK), and any need for reshuffling the structure and/or moves some activities to continental Europe after UK exit. Definitely, a market mover for other bank stocks as well.

Wells Fargo & Co reporting on Friday (estimated EPS 1.01 and -1.5 Y/Y, Revenue 22.248). As it is the number 3 by assets in US, company results will be scrutinized from retail perspective. The mortgage and lending business can do well due to low long-term interest rates that support refinancing.

Citigroup Inc reporting on Friday (estimated EPS 1.13 and -22.3 Y/Y, Revenue 17.723). Along with JPMorgan Chase there will be some question marks related to Brexit vote and the market will also review the profitability of their global business model, as the activity in EM was not spectacular. Citigroup has the most business of US banks coming from abroad, thus is more vulnerable to international developments.

Good luck Champs!

Mr Hawk

 DISCLAIMER: This material was created for informational purposes only and represents the Land of Trading       teams view on past and current economic and capital market environment. It is not and shouldn´t been viewed   as an investment advice and the creator of this material shouldn´t been hold liable for any loss resulting from       action where despite this disclaimer someone would consider this  material  as an investment advice. 

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