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Market Outlook February 15th - 19th PDF Print E-mail

 

Market Outlook

- US : US indices rose last week although their advance were reduced during the last sessions after China raised the level of reserves banks must hold for the second time this year. Shares in the Semiconductors (4.32%), Cons. Durables (+4.13%) and Food, Bever. & Tobac. (+2.26%) were the best performers WoW while shares in the Banks (-1.31%), Real Estate (-1%) and Utilities (-0.87%) sectors remained weak. From a technical point of view the 1080 resistance on the S&P 500 maintains a bearish bias in the short term and although the market may still try to bounce this week the chance for further slide are real. On the economic side, manufacturing and housing will be in focus during next week. Markets are closed Feb 15 for the Presidents Day holiday.

- EUROPE : European markets also gained even if Greece's financing problems have focused investors' attention. Finance ministers from the euro zone are meeting today. Shares of Personal & Household Goods (+3.45%), Basic Resources (+3.41%) and Food & Beverage (+3.32%) bounced off. Automobiles & Parts (-3.11%), Technology (-2.37%) and Construction & Materials (-1.52%) sectors fell most. On the STOXX 600, below 254 any bounce should be short lived and the risk is still for 230 and even 224.

February 15th - February 19th

Market Round up

 

Weekly chg (%)

Last

Dow Jones

.9

10099.1

Nasdaq 100

1.9

1779.1

Dax Xetra

1.2

5500.4

Cac 40

1

3599.1

Foreign Exchange

Euro/dollar : The pair has rebounded on its support but remains under pressure as the RSI is badly directed. SHORT below 1.4250 towards 1.34 & 1.30.

Dollar/yen : The pair is pulling back on its former channel upper boundary (new support) ahead of a rebound. LONG @ 88 with 93.80 or even 97.50 in sight.


Company preview

Kraft Foods (USD 29.09 ; 2.29% ; KFT ; KFT.N)
On Tuesday, Kraft Foods is expected to release FY09 EPS of $2 compared to $1.22 a year earlier. Sales may reach $40.35bln, down from $42.2bln. Recently, the Co announced it would shut down Cadbury's Somerdale plant in the UK as it had previously planned. Earlier, the Co's corporate credit rating was downgraded to "BBB" from "A-" at Standard & Poor's. Technically, the stock is currently testing a key resistance around $29.1. Only a breakout of this level should open the way to further rally towards $30.15.

Hewlett Packard (USD 48.46 ; 2.41% ; HPQ ; HPQ.N)
On Wednesday, Hewlett-Packard could report 1Q EPS of $1.05 vs $0.93 a year ago on sales of appx. $30bln vs $28.8bln. Last month, the Co said it would partner with Microsoft on a $250m 3yr joint venture to develop market and sell new data center products. From a chartist point of view, the stock remains under pressure below its $49 threshold. Since the 20D MA has clearly reversed down, we expect further decline to a first target at $46.5 in the forthcoming days.

BNP Paribas (EUR 47.9 ; 0.94% ; BNP ; BNPP.PA)
The same day, BNP Paribas may deliver FY09 net income of appx. E5.4bln vs E3bln in the previous year period. Two weeks ago, the Co announced to introduce an equity research and sales office in Brussels during the 1H of the year. In addition, Moody's Investors Service downgraded the senior debt and deposit ratings of the Co to "Aa2" from "Aa1" previously. Technically, the price is still moving down in its bearish channel, as well as being capped by a declining ST moving average. Below E50.8, further downside should be in sight to E45.6 and E42.5 in extension.

Daimler (EUR 32.46 ; -2.55% ; DAI ; DAIGn.DE)
On Thursday, Daimler is expected to unveil a FY09 net loss compared to a profit of E1.4bln a year ago on sales down to E78bln from E95.9bln. Earlier the month, the Co reported US sales for its Mercedes-Benz Cars unit rose 26.4% YoY in January to 15,436 units. The Co was upgraded to "buy" from "hold" at RBS. Technically, the stock remains capped by a major resistance zone around E35. The risk is now a slide below the E32 support, which should spark a downside acceleration towards E30.

border=0 Lafarge (EUR 49.525 ; -3.91% ; LG ; LAFP.PA)
On Friday, Lafarge could post FY09 net income of E1bln vs E1.6bln the previous year. The Co is also expected to achieve FY sales of E16.4bln vs E19bln. Recently, the Co sold its 17.28% interest in Cimpor to Votorantim. Earlier, the Co's CEO Bruno Lafont planned to maintain its share of the Egyptian cement market. Graphically, the price validated a ST "bearish flag" pattern and accelerated on the downside last week. Hence, a further pullback is more likely to occur to E47 and even to E45.4 in the coming weeks.

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


Corporate Calendar February 15th - February 19th

Date

Market

Company

Event

Monday, February 15th

 

FR

Imerys

annual results

 

FR

L'Oréal

annual results

 

FR

ICADE

annual results

 

FR

Air Liquide

annual results

 

GE

Man

annual results

Tuesday, February 16th

 

GE

Deutsche Boerse

annual results

 

UK

Barclays

annual results

 

SP

Gas Natural

annual results

 

US

Qwest Com.

4th-Quarter results

 

US

Kraft Foods

1st-Quarter results

 

US

Merck & Co

1st-Quarter results

Wednesday, February 17th

 

FR

BNP Paribas

annual results

 

US

Deere & Co

4th-Quarter results

 

US

NetApp Inc

4th-Quarter results

 

US

Applied Materials

3rd-Quarter results

 

US

XTO Energy

1st-Quarter results

 

US

Hewlett Packard

3rd-Quarter result

Thursday, February 18th

 

BE

Solvay

annual results

 

FR

Axa

annual results

 

GE

Daimler

annual results

 

UK

BAE Systems

annual results

 

US

Wal-Mart

1st-Quarter results

 

US

Dell Computer

1st-Quarter results

Friday, February 19th

 

FR

Lafarge

annual results

 

FR

Carrefour

annual results

 

UK

Anglo American

annual results

 

UK

Shire

annual results

 

US

JC Penney

1st-Quarter results

 

SZ

Nestle

annual results


Economic Calendar (CET) February 15th - February 19th

Date

Market

Economic data

Period

Expected

Last

Monday, February 15th

   

No major economic data expected

     

Tuesday, February 16th

14:30:00

US

Empire Manufacturing

FEB

16.77

15.92

19:00:00

US

NAHB Housing Market

FEB

16

15

Wednesday, February 17th

14:30:00

US

Housing Starts (Thsd)

JAN

595

557

14:30:00

US

Bulding Permits (Thsd)

JAN

616

653

15:15:00

US

Industrial Production (MoM)

JAN

0.8%

0.6%

15:15:00

US

Industrial Capacity Utilization

JAN

72.6%

72%

Thursday, February 18th

 

14:30:00

US

Producer Price Index (MoM)

JAN

0.7%

0.2%

14:30:00

US

PPI - Ex Food & Energy (MoM)

JAN

0.1%

0%

16:00:00

US

Philadelphia Fed.

FEB

16.24

15.2

16:00:00

US

Leading Indicators

JAN

0.5%

1.1%

Friday, February 19th

14:30:00

US

Consumer Price Index (MoM)

JAN

0.3%

0.1%

14:30:00

US

CPI - Ex Food & Energy (MoM)

JAN

0.1%

0.1%


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. Investors are not authorized to copy, reproduce, duplicate, sell, resell or exploit any portion of the Newsletter for their own commercial purposes. In that case, Internaxx will immediately end the subscription.

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