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Market Outlook August 16th - August 20th PDF Print E-mail

 

Market Outlook

- WALL STREET:
Worries about world economic recovery found more substance in Asia, Friday & this morning with both Hong Kong & Japan GDP 2Q growth estimations falling short of expectations while 1Q were revised lower. Gold prices reached their highest level since July First. US Indices ended the week in the red territory like they did during all the week, except Monday. Automobile, Semi conductors & Technology stocks retreated more than 7% during the week after Cisco missed sales expectations. Only Telecom Services ended the week positive. From a technical point of view, on the S&P 500, as long as 1056 is not broken down, we favour an up move with 1150 and then 1177 as next targets. Alternative scenario: below 1056, expect a direct drop to 1010.

- EUROPE:
European indices fell last week with the Ibex declining the most (3.52%) while the SMI resisted well easing only 0.43%. Food & Beverage and Health Care stocks gained more than 3% while Basic Resources, Travel & Leisure, Automobiles and Construction & Materials stocks declined more than 4%. Regarding technical, the Stoxx 600 remains bullish above 243 and is expected to rise towards 263.5 & 272.5. Alternatively, below 243, look for a direct drop to 230.

August 16th - August 20th

 

Market Round up

 

Weekly chg (%)

Last

Dow Jones

-3.3

10303.2

Nasdaq 100

-4.4

1818.8

Dax Xetra

-2.4

6110.4

Cac 40

-2.8

3610.9

Foreign Exchange

Euro/dollar : the pair has struck against its resistance and should post a pull back ahead of a further up move. LONG above 1.2450 towards 1.3510 & 1.3815.

Dollar/yen : the pair stands within a ST bearish channel and is challenging its support as the RSI is badly directed. SHORT @ 88.8 with 83 or even 80.50 in sight.

 

Company preview

Carlsberg (DKK 499 ; 2.04% ; CARLB ; CARCb.CO)
On Tuesday, Carlsberg, a Danish brewing Co, is expected to release 2Q net income of DK2.1bln compared with DK1.94bln a year earlier. Last week, the Co's CEO Joergen Buhl Rasmussen said he saw growth to come from the Russian market. Recently, the Co raised its stake in the Minsk-based Alivaryya Brewery to 47% from 30% previously. The Co was upgraded to "overweight" from "equal weight" at Barclays. Technically, the stock is supported by its rising 50d MA at 489.

Wal-Mart (USD 50.4 ; -2.68% ; WMT ; WMT.N)
The same day, Wal-Mart, the US retailing giant, will post its quarterly results. 2Q EPS is expected to reach $0.96 ($0.88 a year earlier) on sales of $105.6bln (appx. $101bln). In July, the US retail sales increased by 0.4% vs a revised 0.3% drop in June, but less than the consensus of a 0.5% gain. Recently, Fitch Ratings reaffirmed the Co's IDR ratings at "AA" with a "stable" outlook. Technically, the stock is under pressure below its 20d MA at $51.1.

Target (USD 50.81 ; -2.89% ; TGT ; TGT.N)
On Wednesday, Target, the US retailing giant, will publish its 2Q results. Analysts expect the Co to deliver EPS of around $0.92 ($0.79 a year earlier) on sales of $15.6bln ($15bln). At the beginning of this month, the Co reported July net retail sales of $4.6bln, an increased of 3.8% YoY. Year-to-date sales rose 4.7% to $30.3bln. Technically, the stock has broken a support line and its 20d and 50d MA, the risk is a slide to $48.

Hewlett Packard (USD 40.45 ; -12.63% ; HPQ ; HPQ.N)
Thursday, Hewlett-Packard is scheduled to unveil 3Q results after market. EPS is expected to be $1.07 compared to $0.91 last year on sales of $30.2bln vs appx. $27.5bln. The Co's CEO Mark Hurd has resigned earlier this month and CFO Cathie Lesjak was named interim CEO. The Co's price target was cut to $45 from $52 at Deutsche Bank. The stock is close to a strong $40/39.3 support, a bounce may shape around this level. Below $39.3 the risk would be $37.

Dell Computer (USD 12.01 ; -8.46% ; DELL ; DELL.O)
Finally, Dell Computer will deliver its results the same day. 2Q EPS is seen at $0.3 ($0.27 a year ago) on a revenue of $15.2bln (around $12.8bln). The market will review the group's unit sales, product pipeline, customer service improvements and margins. Technically, the stock is testing a support base around $11.7/11.5, a bounce may shape. Below $11.5 however, the risk will be $10.

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


Corporate Calendar August 16th - August 20th

Date

Market

Company

Event

Monday, August 16th

 

GE

Hochtief

2nd-Quarter results

 

UK

Michael Page International

1st-Half results

 

US

Urban Outfitters

2nd-Quarter results

 

US

Sysco

4th-Quarter results

 

US

Agilent Technologies

3rd-Quarter results

 

US

Lowe's Cos

2nd-Quarter results

Tuesday, August 17th

 

DE

Carlsberg

2nd-Quarter results

 

PO

Cimpor

1st-Half results

 

US

Wal-Mart

2nd-Quarter results

 

US

Home Depot

2nd-Quarter results

 

US

Abercrombie & Fitch

2nd-Quarter results

 

US

TJX Companies

2nd-Quarter results

Wednesday, August 18th

 

DE

APM Maersk

1st-Half results

 

DE

Vestas Wind

2nd-Quarter results

 

US

Applied Materials

3rd-Quarter results

 

US

Limited Brands

2nd-Quarter results

 

US

Deere & Co

3rd-Quarter results

 

US

Target

2nd-Quarter results

Thursday, August 19th

 

US

Dell Computer

2nd-Quarter results

 

US

Gap

2nd-Quarter results

 

US

Sears Holdings

2nd-Quarter results

 

US

Staples

2nd-Quarter results

 

US

Hewlett Packard

3rd-Quarter results

 

SZ

Holcim

2nd-Quarter results

Friday, August 20th

 

SZ

Valiant

1st-Half results

 

SW

Ratos-B

2nd-Quarter results

 

US

JM Smucker

1st-Quarter results

 

US

Hormel Foods Corp

3rd-Quarter results


Economic Calendar (CET) August 16th - August 20th

Date

Market

Economic data

Period

Expected

Last

Monday, August 16th

11:00:00

EC

Euro-Zone: CPI (MoM)

JUL

-0.4%

0%

14:30:00

US

Empire Manufacturing

AUG

9.2

5.1

16:00:00

US

NAHB Housing Market

AUG

15

14

Tuesday, August 17th

11:00:00

GE

Zew Survey (Econ. Sentiment)

AUG

21.1

21.2

11:00:00

GE

Zew Survey (Current Situation)

AUG

24

14.6

14:30:00

US

Housing Starts (Thsd)

JUL

563

549

14:30:00

US

Bulding Permits (Thsd)

JUL

575

583

15:15:00

US

Industrial Production (MoM)

JUL

0.6%

0.1%

15:15:00

US

Industrial Capacity Utilization

JUL

74.6%

74.1%

Wednesday, August 18th

16:30:00

US

Crude Oil Inventories (WoW chg)

W32

NA

-2988

Thursday, August 19th

08:00:00

GE

Producer Price Index (MoM)

JUL

0.1%

0.6%

10:30:00

UK

Retail Sales (MoM)

JUL

NA

1.1%

10:30:00

UK

Public Finances (PSNCR) (Bln)

JUL

NA

20.905001

14:30:00

US

Initial Jobless Claims (Thsd)

W32

481

484

16:00:00

US

Philadelphia Fed.

AUG

5.6

5.1

16:00:00

US

Leading Indicators

JUL

0.1%

-0.2%

Friday, August 20th

   

No major economic data expected

     


 

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