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Reports US

US stock market, economy and companies update (May 27, 2014)

May 27, 2014, Tuesday, 15:26 GMT | 10:26 EST | 18:56 IST | 21:26 SGT
Contributed by Trade The News


- The S&P500 has pushed out to fresh all-time highs this morning in another session of light trading volumes. As of writing, the DJIA is up 0.45%, the S&P500 is up 0.57% and the Nasdaq is up 0.90%.

- The headline durable goods reading unexpectedly climbed for a third consecutive month in April and the March figures were revised higher. Durables ex volatile transport orders were almost flat, however, right in line with expectations. The May confidence index rose to 83 from 81.7 in April, which was revised lower.

- Gold prices have slid nearly 2% through the European session on a number of factors. China's gold imports from Hong Kong fell in April amid signs that investment demand is waning. The election in Ukraine provided a decisive outcome and Russia has made conciliatory noises. There has been some follow-on effect from falling platinum prices, after South Africa's mining minister pledged to mediate in a long-running strike. As of writing, spot gold was around $1,268, -1.8% on the session.

- Next week, the Obama administration will roll out a set of EPA proposals to regulate emissions from existing power plants, including coal plants. The key structure of the proposals will be a cap-and-trade system designed to give states the flexibility to meet benchmarks, as opposed to placing emissions limits on individual plants. Recall that last week, there were reports suggesting the EPA rules could result in required 25% cut in greenhouse gas emissions by the utility sector.

- In deal news, Pfizer has let the clock run out on its bid for AstraZeneca, with no higher offer or further interest from AstraZeneca. Under UK takeover rules, Pfizer could resubmit another offer for AstraZeneca in six months, meaning the chances of a deal are not entirely gone. Pilgrim's Pride is offering to buy Hillshire Brands for $45/shr in cash, in a deal worth $6.4 billion. Recall that back on May 12th, Hillshire cut its own deal to buy Pinnacle Foods for $36/shr in cash and stock, in a total deal valued around $4.3 billion.

- Struggling retailer Aeropostale, which reported dismal first quarter results just last week and saw its shares tumble ~25%, reached a financing deal with Sycamore Partners. The company gets $150M in term loans and Sycamore gets two board seats. Shares of ARO are up 15% this morning.

***Looking Ahead***
- 11:30 (US) Treasury to sell combined $48B in 3-month and 6-month Bills
- 13:00 (US) Treasury to sell $31B in 2-Year Notes
- 13:30 (BR) Brazil Apr Total Federal Debt (BRL): No est v 2.081T prior
- 14:00 (US) Fed Discount Minutes
- 15:00 (UK) BOE Gov Carney in London
- 20:00 (JP) BOJ Gov Kuroda speaks at Conference at BOJ
- 20:10 (US) Fed's Lockhart in Baton Rouge
- 21:30 (CN) China Apr YTD Industrial Profits Y/Y: No est v 10.1% prior
- 23:00 (CN) China to Sell 5-Year Bonds


***Economic Data***
- (EU) ECB drains €102.9B vs. €164.5B target in 7-day Term Deposit Tender to offset govt bond purchases under SMP (**Note: ECB has now failed to fully sterilize bond purchases the past seven weeks)
- (ES) Spain Apr YTD Budget Balance: -€14.2B v -€9.9B prior
- (HU) Hungary Central Bank (NBH) cut Base Rate by 10bps to 2.40%; as expected to a fresh record low
- (US) Apr Durable Goods Orders: +0.8% v -0.7%e; Durables Ex Transportation: 0.1% v 0.0%e v 2.4% prior
- (US) Mar S&P/CaseShiller 20 City M/M: 1.24% v 0.70%e; Y/Y: 12.37% v 11.85%e; Home Price Index: 166.80 v 166.20e
- (US) Q1 S&P/CaseShiller HPI Y/Y: 10.35% v 11.30% prior; Home Price Index: 150.76 v 150.39 prior
- (EU) Weekly ECB Forex Reserves: €209.9B v €210.0B prior
- (US) Mar FHFA House Price Index M/M: 0.7% v 0.5%e; Q/Q: 1.3% v 1.3%e
- (US) May Preliminary Markit Services PMI: 58.4 v 54.5e; Composite PMI: 58.6 v 55.6 prior
- (US) May Consumer Confidence Index: 83.0 v 83.0e
- (US) May Richmond Fed Manufacturing Index: 7 v 5e
- (US) May Dallas Fed Manufacturing Activity: 8.0 v 9.2e