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Market Outlook March 7th - March 11th PDF Print E-mail

Market Outlook

- WALL STREET:
US indices consolidated last week. On the economic data front, the US economy added 192,000 jobs in February (196K expected) while the unemployment rate fell to 8.9% from 9%. Also, factory orders jumped 3.1% (+2.0% expected) in January from a revised 1.4% gain the prior month. The ISM index of services rose to 59.7 in February (59.3 expected) from 59.4 one month earlier. In other news, Costco Wholesale delivered 2Q EPS of $0.79 ($0.78 expected) vs $0.67 a year ago on sales up 11% YoY to $20.45B. Regarding sectors, pharmacy and healthcare rose most by more than 2%, whereas automobile, diversified financials, banks and real estate ended into positive territory. Technically, the S&P is still consolidating above its bullish 50D MA. As long as 1249 holds on the downside, look for a further rise towards 1357 after a ST pause.

- EUROPE:
In the UK, the FTSE 100 fell sightly last week. However, above 5800, the index is expected to challenge its 6100 resistance at first before a new leg up towards 6350. Looking at economic data, UK's February Halifax House Prices fell 0.9% MoM (-0.5% expected) vs +0.8% in January. PMI construction rose to 56.5 in February (52.8 expected) from 53.7 in January. In Europe, Fitch Ratings revised Spain's rating outlook to "negative" from "stable" and affirmed its long-term foreign and local currency IDRs at "AA+". European Central Bank left its benchmark interest rate unchanged at 1%, as expected. Also, Euro-Zone January's PPI rose 1.5% YoY (+1.1% expected) vs +0.8% in December 2010. Almost all stock markets in Europe closed into negative territory last week. The IBEX lost most by appx. 3% and the CAC fell 1.23% during the week. Automobile, banks, retail and utilities sectors declined the most, whereas, technology, basic resources and chemicals closed into positive area. Technically, the Stoxx 600 is now testing its MT bullish trend line's support. But we remain positive with targets at 293 & 300.

 

  March 7th - March 11th

border=0 Market Round up

 

Weekly chg (%)

Last

Dow Jones

.3

12169.9

Nasdaq 100

.6

2360

Dax Xetra

-.1

7178.9

Cac 40

-1.2

4020.2

border=0 Foreign Exchange

Euro/dollar : the pair has broken above its falling wedge upper boundary and should post a further up move, the RSI is well directed. LONG above 1.3250 towards 1.4250 & 1.4450.

Dollar/yen : the pair has struck against its resistance and should face a down move. SHORT below 84.50 with 80.35 or even 79 in sight.

 

 

Company preview

border=0 Antofagasta (GBp 1437 ; 2.86% ; ANTO ; ANTO.L)
On Tuesday, Antofagasta, the mining giant, is expected to deliver FY pre-tax profit of appx. $2.6B compared with $1.4B a year earlier. Earlier, the Co released its output results. Group copper production was 521,100 tonnes in 2010, up 17.8% YoY and molybdenum production at Los Pelambres was 8,800 tonnes, a 12.8% increase on 2009. The Co expects FY11 to produce appx. 715,000 tonnes of payable copper and 9,300 tonnes of molybdenum. Graphically, the stock rebounded last week from the 1380 support, and should test the upper boundary of its ST bearish channel before further upsides to 1600.

border=0 Lagard?re (EUR 32.93 ; 0.24% ; MMB ; LAGA.PA)
Wednesday, Lagardere may release FY net income of E305M vs E137M a year earlier on sales of appx. E8B vs E7.9B. At the end of last month, the Co and Aeroports de Paris extended their partnership on retail operations in Parisian airports. From a chartist view, the stock price is pulling back to its major MT support at E32. As long as this level is not broken down, further rallies are more likely to E34 and E36 in extension.

border=0 Prudential (GBp 710.5 ; 2.23% ; PRU ; PRU.L)
The same day, Prudential, the UK-based, international insurance company could post FY profit before tax of ?1.6B compared to ?1.56B a year ago. Last week, the Co was rated "overweight" at Barclays. Earlier, the stock was also upgraded to "buy" from "hold" at Societe Generale. From a technical point of view, the stock price remains well positively oriented and the rising 50D MA plays important role as a key support. Hence, above 680p, a new rally to challenge 750 (the YTD high) seems likely in the forthcoming days.

border=0 Deutsche Post (EUR 12.81 ; -3.17% ; DPW ; DPWGn.DE)
On Thursday, Deutsche Post is expected to announce FY net income of E1.3B compared with E644M a year ago on sales of E51.5B vs E46.2B. Earlier, the Co's DHL unit signed a multi-year sponsorship agreement with Andretti Autosport. In addition, DHL planned to invest $22.5M to expand its hub facility at the Cincinnati/Northern Kentucky airport in the US. Technically, the stock price failed to surpass its key resistance at E14 and also broke below the 20D & 50D MAs. Below E13.45, the risk of the return to E12.35 remains high.

border=0 Morrison Supermarkets (GBp 280.9 ; -0.67% ; MRW ; MRW.L)
On the same day in the UK, WM Morrison Supermarkets could unveil FY pre-tax profit of ?861M, almost in line with last year on sales of ?16.5B vs ?15.4B. Recently, the Co spent ?70M to buy Kiddicare, a family-owned online retailer of baby products. From a chartist view, the stock is now consolidating above 274.5p (a ST support). Both the 20D & 50D MAs have already reversed up, which should push the price further up to 290p and 300p in extension.

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


Corporate Calendar March 7th - March 11th

Date

Market

Company

Event

border=0 Monday, March 7th

 

GE

Salzgitter

annual results

 

UK

Intertek Group

annual results

 

UK

Petrofac Ltd

annual results

 

UK

Michael Page International

annual results

 

UK

Inmarsat

annual results

 

US

Urban Outfitters

4th-Quarter results

border=0 Tuesday, March 8th

 

FR

Scor

annual results

 

GE

Kloeckner & Co

annual results

 

UK

Standard Life

annual results

 

UK

Antofagasta

annual results

 

UK

Old Mutual

annual results

 

US

Brown Forman

3rd-Quarter results

border=0 Wednesday, March 9th

 

FR

Lagard?re

annual results

 

GE

E.ON

annual results

 

GE

Hannover Re

annual results

 

UK

Prudential

annual results

 

UK

Tullow Oil

annual results

 

US

H&R Block

3rd-Quarter results

border=0 Thursday, March 10th

 

GE

Deutsche Post

annual results

 

GE

Linde

annual results

 

UK

Aggreko Plc

annual results

 

UK

Morrison Supermarkets

annual results

 

US

National Semiconductor

3rd-Quarter results

 

US

Pall

2nd-Quarter results

border=0 Friday, March 11th

 

GE

Fraport

annual results

 

IT

Atlantia

annual results

 

NE

VOPAK

annual results


Economic Calendar (CET) March 7th - March 11th

Date

Market

Economic data

Period

Expected

Last

border=0 Monday, March 7th

21:00:00

US

Consumer Credit (Bln)

JAN

3.497

6.099

border=0 Tuesday, March 8th

08:45:00

FR

Central Govt. Balance (Bln)

JAN

NA

-148.798

08:45:00

FR

Trade Balance (Mln)

JAN

NA

-5054

border=0 Wednesday, March 9th

10:30:00

UK

Trade Balance Non EU25 (Mln GBP)

JAN

-5181.25

-5817

10:30:00

UK

Visible Trade Balance (Mln GBP)

JAN

-8488.2

-9247

13:00:00

GE

Industrial Production (MoM)

JAN

1.9%

-1.5%

16:00:00

US

Wholesale Inventories

JAN

0.9%

1%

16:30:00

US

Crude Oil Inventories (WoW chg)

W9

NA

-364

border=0 Thursday, March 10th

07:30:00

FR

Non-Farm Payrolls (QoQ)

1Q

NA

0.2%

09:00:00

GE

Trade Balance (Bln)

JAN

13.2

11.9

10:30:00

UK

Industrial Production (MoM)

JAN

0.4%

0.5%

13:00:00

UK

BoE: Rates decision

 

0.5%

0.5%

14:30:00

US

Initial Jobless Claims (Thsd)

W9

377

368

14:30:00

US

Trade Balance (Bln)

JAN

-41.7

-40.6

border=0 Friday, March 11th

09:00:00

GE

Consumer Price Index (MoM)

SEP

0.5%

0.5%

10:30:00

UK

PPI - Input (MoM)

FEB

1.6%

1.7%

10:30:00

UK

PPI - Output (MoM)

FEB

0.6%

1%

14:30:00

US

Retail Sales

FEB

0.9%

0.3%

15:55:00

US

U. of Michigan Confidence

FEB

76.6

77.5

16:00:00

US

Business Inventories

JAN

0.7%

0.8%

INTERNAXX

This document does not constitute financial advice. If you require such advice, you should seek appropriate professional advice.
 

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