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Market Outlook - 23rd - 27th January PDF Print E-mail

Market Outlook

- WALL STREET:
US indices extended their gains for another week. On the US economic data front, initial jobless claims for the week ended January 14 dropped to 352K from a revised 402k the previous week. The Consumer Price Index was unchanged in December while industrial production rose 0.4% MoM in December (+0.5% expected). Regarding US stocks, General Electric reported Q4 operating EPS up 11% YoY to $0.39 ($0.38 exp.). Microsoft posted 2Q EPS of $0.78 ($0.76 exp.) while Google 2Q non-GAAP EPS of $9.50 ($10.5 exp.) and Morgan Stanley unveiled a 4Q net loss of $250M. Almost all sectors finished the week higher. Semiconductors, retailing and insurance recorded the strongest gains. From a technical perspective, even the S&P 500 index is on the upside, it is forming a rising wedge pattern, which calls for caution as it is approaching the 1350 res{jcomments on}istance.

- EUROPE:
The FTSE 100 index rose 1.63% last week. Graphically, the index consolidates above a ST rising trend line, and is expected to post a limited upside to 5760 and 5800 in extension. Looking at the economic news, UK retail sales gained 0.6% in December, vs -0.5% in November and the UK Nationwide consumer confidence was 38 in December, vs 40 in November. Also, the ILO unemployment rate rose to 8.4% in November from 8.3% the previous month. In Europe, the DAX and the FTSE MIB gained over 4% while the Cac 40 index rose 3.91% over the past week. In other news, the German Government revised its GDP growth forecast for 2012 to 0.7% from +1% and the IMF wants to boost its lending resources from the current $385 billion to support the global economy. Most sectors finished the week in the positive territory. Stocks in the banking, insurance and automobiles sectors posted the best performance, rising by more than 6%. Technically, the Stoxx600 index broke above its major resistance at 251, and is supported by a mid-term rising trend line, which should open the way towards 262 and 273.

 

  January 23rd - January 27th

 

border=0 Market Round up

 

Weekly chg (%)

Last

Dow Jones

2

12720.5

Nasdaq 100

2.3

2437

Dax Xetra

4.3

6404.4

Cac 40

3.9

3321.5

border=0 Foreign Exchange

Euro/dollar : the pair remains within a bearish channel and is challenging its support. SHORT position below 1.32 with 1.26 & 1.24 in sight.

Dollar/yen : the pair stands below its resistance and remains under pressure. SHORT position below 79.5 with 75.5 & 73.75 in sight.

Company preview

border=0 Siemens (EUR 78.05 ; 3.39% ; SIE ; SIEGn.DE)
Tuesday, Siemens could release 1Q net income of E1.46B, down from E1.72B in the same prior year period, on sales of E18.3B, compared with E19.5B. Last month, the German electronics and electrical engineering company told the Sueddeutsche Zeitung that it still seeks to list its lighting unit Osram once market conditions allow. Technically, the stock remains on the upside and is challenging its strong resistance at E79.5. If breakout, this should open the way towards E84.5 at first and E89 in extension.

border=0 Apple (USD 420.3 ; -0.26% ; AAPL ; AAPL.O)
Later in the afternoon, Apple is expected to post 1Q EPS of $10.1, up from $6.43 a year earlier, on revenues of $38.8B, vs $26.7B. The designer of mobile communication and media devices recently started to sell the iPhone 4S in China on January 13. From a technical perspective, the stock is facing a pull back but should post a rebound on its new strong support at $395 with a first target at $432. A break below the $395 mark will call for further weakness towards $375 at first and $360 in extension.

border=0 Boeing (USD 75.52 ; 0.01% ; BA ; BA.N)
On Wednesday, Boeing may report 4Q EPS of $1.01, vs $1.11 in 4Q10, on turnover of $19.4B, up from $16.55B in the previous year. Recent, the aerospace company said its Boeing Defense, Space & Security (BDS) facility in Wichita, which employs over 2,160 employees will close by the end of 2013. Technically, the stock stands above its new support at $70 and remains well oriented. Further advance is likely towards the previous high at $80.42. Only a downside break below $70 will open the way to a consolidation towards $64.

border=0 Kazakhmys Plc (GBp 1123 ; 6.75% ; KAZ ; KAZ.L)
The next day, Kazakhmys could unveil 2H pretax income of £455M, down from £613M in the previous year, while revenue could reach £1.12B, vs £1.10B. The UK-based natural resources company has been recently upgraded to "buy" from "hold" at Jefferies and was rated "buy" at SocGen. The stock broke above a declining trend line in place since August 2011 and should post further advance towards 1284p at first and 1410p in extension (horizontal resistances).

border=0 Ford Motor (USD 12.59 ; 3.71% ; F ; F.N)
Friday, Ford Motor is expected to report 4Q EPS of $0.26, vs $0.31 a year earlier, on revenue of $33.5B, compared to $32.4B. The US car maker reported December Ford brand sales up 16% YoY to 201,737 units and said it expects global industry sales to be in the range of 75 million to 85 million units in 2012. Technically, the stock is challenging a key MT resistance at $12.75. A break above this mark will call for further bounce towards $14.3. Alternatively, if $12.75 holds as a resistance, a weakness will take place with $11 as a first target.

Selection of those events which may affect the stock prices of international Large Caps


Corporate Calendar January 23rd - January 27th

Date

Market

Company

Event

border=0 Monday, January 23rd

 

GE

Wincor Nixdorf

1st-Quarter results

 

US

CSX

4th-Quarter results

 

US

Halliburton

4th-Quarter results

 

US

Texas Instruments

4th-Quarter results

 

US

Western Digital

2nd-Quarter results

 

US

Zions Bancorporation

4th-Quarter results

border=0 Tuesday, January 24th

 

GE

Siemens

1st-Quarter results

 

IT

STMicroelectronics

annual results

 

NE

KPN

annual results

 

US

Apple

1st-Quarter results

 

US

Du Pont De Nemours

4th-Quarter results

 

US

Yahoo

4th-Quarter results

border=0 Wednesday, January 25th

 

GE

SAP

annual results

 

SW

Ericsson

annual results

 

SZ

Novartis

annual results

 

US

Boeing

4th-Quarter results

 

US

ConocoPhillips

4th-Quarter results

 

US

Motorola Solutions

4th-Quarter results

border=0 Thursday, January 26th

 

FI

Nokia

annual results

 

SW

Hennes & Mauritz

annual results

 

UK

Kazakhmys Plc

annual results

 

US

Bristol Myers Squibb

4th-Quarter results

 

US

Caterpillar

4th-Quarter results

 

US

Colgate Palmolive

4th-Quarter results

border=0 Friday, January 27th

 

IT

Enel Green Power

annual results

 

US

Altria

4th-Quarter results

 

US

Chevron

4th-Quarter results

 

US

Ford Motor

4th-Quarter results

 

US

Legg Mason Inc

3rd-Quarter results

 

US

Procter & Gamble

2nd-Quarter results


Economic Calendar (CET) January 23rd - January 27th

Date

Market

Economic data

Period

Expected

Last

border=0 Monday, January 23rd

08:45:00

FR

Business Confidence Indicator

JAN

NA

94

08:45:00

FR

Production Outlook Indicator

JAN

NA

-37

16:00:00

EC

Euro-Zone: Consumer Confidence

DEC

NA

-21.1

border=0 Tuesday, January 24th

10:30:00

UK

Public Sector Net Borrowing (Bln)

DEC

NA

15.2

10:30:00

UK

Public Finances (PSNCR) (Bln)

DEC

NA

10.622

12:59:00

GE

Import Prices (MoM)

SEP

NA

0.4%

border=0 Wednesday, January 25th

10:00:00

GE

IFO - Business Climate

SEP

NA

8.3%

10:00:00

GE

IFO - Current Assessment

JAN

NA

0.3%

10:00:00

GE

IFO - Expectations

JAN

NA

0.1%

10:30:00

UK

GDP (QoQ)

3Q

NA

-0.22%

18:30:00

US

Fed: Rates decision

 

0.25%

77.8%

border=0 Thursday, January 26th

14:30:00

US

Durable Goods Orders

DEC

1.5%

3.7%

14:30:00

US

Durable Goods Ex Transportation

DEC

0.7%

0.3%

16:00:00

US

New Home Sales (Thsd)

DEC

320.49

315

16:00:00

US

Leading Indicators

DEC

0.7%

0.5%

border=0 Friday, January 27th

10:00:00

EC

Euro-zone: M3 (3 mth ave.)

DEC

NA

2.5%

14:30:00

US

GDP (QoQ)

3Q

3.1%

1.8%

14:30:00

US

GDP Price (QoQ)

3Q

1.8%

2.6%

14:30:00

US

Personal Consumption

3Q

NA

1.7%

15:55:00

US

U. of Michigan Confidence

JAN

73.6

74


 


This document does not constitute financial advice. If you require such advice, you should seek appropriate professional advice. Internaxx accepts no responsibility for the content of this newsletter.

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