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US stock market, economy and companies update (February 21, 2013)

Contributed by Trade The News

- US equities are in the red this morning as traders pull back in the wake of the FOMC minutes, plus more weak European PMI readings and China's moves to further tighten the property market. The DJIA is down 0.45%, the S&P500 is down 0.61% and the Nasdaq is down 0.78%.

- Contrasting sharply with the very good Feb Empire Manufacturing survey last week, today the Feb Philly Fed index dropped to its lowest level since last June, firmly in contraction territory. In addition, the Markit Feb flash PMI fell to 55.2 from 55.8 last month. On the housing front, the NAR's Jan existing home sales survey was decent, showing a very slight gain from December's figure.

- Markets continue to react to yesterday's FOMC minutes disclosure. In the minutes, it was clear that there is growing anxiety on the committee about monthly bond purchases. The statement read that "an ongoing evaluation of the efficacy, costs, and risks of asset purchases might well lead the committee to taper or end its purchases before it judged that a substantial improvement in the outlook for the labor market had occurred." The punchbowl is still on the table, but the Fed clearly wants to make it harder to access.

- Walmart offered a mixed Q4 report. Earnings grew solidly and beat expectations, however revenue was lower than expected. The company confirmed that February comps were weak (in line with a leaked internal communications out last week), blaming a delay in income tax refunds, but it also said that comps had normalized by mid month. Note that Walmart also hiked its dividend 18%.

- Verifone slashed its Q1 outlook yesterday evening, warning that both Q1 and Q2 results would be way below expectations. The firm blamed conditions in Europe, increased deferred payments and several customers delaying big new projects. Multiple analysts cut their ratings and PTs on the firm, and PAY is down nearly 40%.

- AZZ is down 8% after the firm cut its FY13 forecast slightly. The company cited customers deferring orders due to the December/January slowdown.

- Molina Healthcare slightly reduced its FY13 guidance due to issues related to a recent convertible note sale, on some incremental items. Shares of MOH are flat on the day

- AIG has been much discussed this morning, after a Goldman Sachs report asserted that the firm has replaced Apple as the hedge fund industry's favorite stock, according to quarterly filings.

- Linn Energy is continuing to expand its oil position by acquiring Berry Petroleum in a $4.3B all-stock transaction. The addition of Berry's properties will increase Linn's production by 30%, or about 240 million cubic feet equivalent per day. Shares of LINE are up about 3%.

- Chesapeake Energy said it would complete its search for a new CEO by April. The firm's Q4 results were better than expected, thanks to lower expenses and better oil profits. Shares of CHK are around unchanged on the day after gaining 2% in the premarket.

- Shares of Safeway are up 6% after the firm's net profit rose sharply y/y and beat expectations.

- Shares of Valassis Communications are down 9% after the firm Q4 earnings missed expectations on a sizable y/y decline.

***Looking Ahead***
All times listed for economic events are denominated in Eastern Standard Time (Add 5 hours for GMT equivalent)
- 12:30 (US) Fed's Bullard speaks About Monetary Policy in New York
- 13:00 (US) Fed's Williams Speaks on Monetary Policy in New York
- 13:00 (US) Treasury to sell $9.0B in 30-Year TIPS
- 13:15 (UK) BOE member Miles
- 14:00 (AR) Argentina Jan Trade Balance: $450Me v $529M prior
- 17:00 (IT) Italy PM Monti
- 17:30 (AU) Austral Central Bank (RBA) Gov Stevens semi-annual testimony to panel in Canberra

***Economic Data***
- (PT) Portugal Dec Current Account: -€43.1M v -€277.7M prior
- (UK) Feb CBI Industrial Trends Total Orders: -14 v -15e; Selling Prices: +20 v +15e
- (IE) Ireland Jan CPI M/M; -0.5% v +0.1% prior; Y/Y: 1.2 v 1.2% prior
- (IE) Ireland Jan CPI EU Harmonized M/M; -0.6 v 0.0% prior; Y/Y: 1.5 v 1.7% prior
- (IE) Ireland Jan PPI M/M; -0.3 v -0.9% prior; Y/Y: -0.4 v +1.3% prior
- (US) Jan Consumer Price Index M/M: 0.0% v 0.1%e; Y/Y: 1.6% v 1.6%e
- (US) Jan CPI Ex Food & Energy M/M: 0.3% v 0.2%e; Y/Y: 1.9% v 1.8%e
- (US) Jan Consumer Price Index NSA: 230.280 v 230.300e; CPI Core Index SA: 232.108 v 231.938e
- (US) Initial Jobless Claims: 362K v 355Ke; Continuing Claims: 3.148M v 3.150Me
- (US) Feb Preliminary Markit PMI Manufacturing: 55.2 v 55.5e
- (MX) Mexico Dec Retail Sales: -1.8% v +2.0%e
- (US) Commercial Paper outstanding w/e Feb 14th; -$22.4B v -$13.1B prior; Total CP Outstanding: $1.063T
- (US) Feb Philadelphia Fed: -12.5 v +1.1e
- (US) Jan Existing Home Sales: 4.92M v 4.90Me
- (US) Jan Leading Indicators: 0.2% v 0.2%e
- (US) Q4 MBA Mortgage Delinquencies: 7.09 v 7.4% prior; Mortgage Foreclosures: 3.74 v 4.07% prior