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Reports US

US stock market, economy and companies update (August 15, 2014)

August 15, 2014, Friday, 17:54 GMT | 12:54 EST | 21:24 IST | 23:54 SGT
Contributed by Trade The News

- Trading has been volatile this morning as participants react to headlines emerging from the Russia/Ukraine border. As of writing, the yield on the benchmark 10-year UST yield has plummeted to one-year lows around 2.322%, the DJIA has dipped 0.36%, the S&P500 is still up 0.27% but is losing altitude, while the Nasdaq is flat.

- The situation in Ukraine was unsettled overnight, although Kiev had agreed to allow the Russian humanitarian aid convoy to enter the country through a separatist-controlled border checkpoint, with International Red Cross supervision. But last night, a separate convoy of Russian armored vehicles were seen crossing the border and after the open Ukraine officials said the column had been mostly destroyed. The latter news took equities off their highs and put a bid under risk assets. Note that earlier this morning, the EU Commission had said it would review its sanctions regime if eastern Ukraine was stabilized and said it did not want to impose any further sanctions on Russia. Spot gold tanked on the remarks, moving below $1,300, although it has regained most of its losses in a quick turnaround.

- The New York Fed's August manufacturing survey fell to 14.7 from 25.6 prior, however analysts are focusing more on the six-month outlook, which rose to 46.8 from 28.5 prior, for the highest reading since January 2012. There were no surprises in the July PPI data, which was right in line with expectations. Expectations slipped a bit in the preliminary August U of Michigan confidence data from final July levels, but the current conditions index was stronger.

- Shares of Monster Beverage are among the biggest movers, still up 31% this morning after Coca-Cola said last night that it had acquired a 16% stake in the company. Coke would not rule out acquiring all of Monster at a later date. Note that this move comes only a few months after Coke bought 10% of Green Mountain Coffee. Shares of KO are up 1.8%.

- Estee Lauder missed earnings expectations in its second quarter results, although top-line revenue was comfortably ahead of expectations. Shares of EL tumbled 1.5% after the release but are back in the black mid-morning as focus shifts to the firm's decent revenues and good guidance.

- In an awkward timing for China e-commerce giant Alibaba, which is about to launch the biggest ever US IPO, a film producer it bought in June said it had uncovered possible accounting flaws and won't be able to publish its interim results on time. The irregularities at ChinaVision Media are from before the acquisition.

***Looking Ahead**
- Austria and Ireland Sovereign Debt Ratings to be published by Fitch
- (BR) Brazilian Central Bank President Tombini Speaks in Sao Paulo
- 14:00 (CO) Colombia Central Bank Monetary Policy Minutes
- 15:00 (AR) Argentina July Wholesale Price Index M/M: No est v 1.5% prior; Y/Y: No est v 27.7% prior
- 17:00 (CO) Colombia Jun Retail Sales Y/Y: 7.2%e v 8.1% prior
- 17:00 (CO) Colombia Jun Industrial Production Y/Y: 3.9%e v 2.0% prior
- (AR) Argentina July National Urban CPI M/M: no est v 1.3% prior
- (PE) Peru Jun Economic Activity Index Y/Y: No est v 1.8% prior
- (PE) Peru July Unemployment Rate: No est v 5.7% prior

***Economic Data***
- (EU) ECB: Eight banks to repay total €2.9B in 3-Year LTRO Funds v €4.0Be
- (IL) Israel July CPI M/M: 0.1% v 0.1%e; Y/Y: 0.3% v 0.4%e
- (BR) Brazil Aug FGV Inflation IGP-10 M/M: -0.6% v -0.4%e
- (BR) Brazil Jun Economic Activity Index M/M: -1.5% v -1.5%e; Y/Y: -2.2% v -2.2%e
- (US) Aug Empire Manufacturing: 14.69 v 20.00e
- (US) July PPI Final Demand M/M: 0.1% v 0.1%e; Y/Y: 1.7% v 1.7%e
- (US) July PPI Ex Food and Energy M/M: 0.2% v 0.2%e; Y/Y: 1.6% v 1.6%e
- (CA) Canada July re-release of Net Change in Employment: +41.7K v +20.0Ke; Unemployment Rate: 7.0% v 7.1%
- (CA) Canada Jun Manufacturing Sales M/M: 0.6% v 0.4%e
- (US) Jun Net Long-term TIC Flows: -$18.7B v +$18.6B prior; Total Net TIC Flows: -$153.5B v $33.1 prior
- (CA) Canada July Existing Home Sales M/M: 0.8% v 0.8% prior
- (US) July Industrial Production M/M: 0.4% v 0.3%e; Capacity Utilization: 79.2% v 79.2%e; Manufacturing Production: 1.0% v 0.4%e
- (US) Aug Preliminary University of Michigan Confidence: 79.2 v 82.5e