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US stock market, economy and companies update (September 12, 2012)

Contributed by Trade The News

- A touch of risk appetite has carried over from the European session into New York trading on the largely positive German Constitutional Court ruling on the ESM earlier this morning. The conditions placed on German participation were relatively mild: no more than a €190B German contribution and guarantees that the parliament would be consulted on ESM activities. In the US, the solid July wholesale inventory data helped sustain the risk-on tone in early trading. However, markets have returned to unchanged mid-morning following the data as the FOMC gathers ahead of its big announcement tomorrow.

- Various tech names are in focus this morning. In its mid-quarter update Texas Instruments bucked the trend of bad news out of the semi industry and actually increased its Q3 earnings guidance range slightly. The firm also narrowed its revenue forecast for the quarter. Shares of Facebook jumped following CEO Zuckerberg's first public interview since the botched IPO. FB is up 5% this morning after Zuckerberg offered a mea culpa, admitting that the performance of the stock has been disappointing and insisting that Facebook cares about shareholders. He also made bullish comments about the firm's search and mobile strategies. Shares of enterprise data firm Xyratex are down 12% in the early going after the firm warned that its Q3 revenue would be well below expectations.

- Moodys raised its FY12 outlook this morning and slightly boosted its share buyback authorization. Steel name Steel Dynamics offered a dismal Q3 outlook yesterday evening, warning that global economic and political uncertainty is hurting customer confidence, as inventory destocking would decrease steel shipments. Shares of STLD are down more than 3%. Shares of American Eagle Outfitters are up 4% after the firm floated a special dividend.

- The greenback has come off of multi-month lows during the New York session as market participants contemplated whether the steps taken by the EU to resolve the crisis would be sustainable. EUR/USD was hovering around the 1.29 handle while USD/JPY continued to hold above the 77.63 level. Chinese ambassador to the EU Wu Hailong helped risk appetite after he noted that China had intensified cooperation with EFSF and would continue to invest in European debt.

***Looking Ahead***
- 11:00 (US) Fed to buy $7.0-8.0B in notes
- 12:00 (DE) German Chancellor Merkel
- 13:00 (EU) ECB member Nowotny
- 13:00 (US) Treasury to sell 10-Year Notes Reopening
- 14:00 World Bank issues global financial development report
- 15:00 (NL) Polls close in Netherlands
- 15:00 (AR) Argentina Aug Consumer Price Index M/M: 0.8%e v 0.8% prior; Y/Y: 9.9%e v 9.9% prior
- 15:00 (AR) Argentina Aug Wholesale Price Index M/M: No est v 1.0% prior; Y/Y: No est v 12.8% prior
- 17:00 (NZ) New Zealand Central Bank (RBNZ) Interest Rate Decision: Expected to leave the Official Cash Target Rate unchanged at 2.50%

***Economic Data***
- (US) MBA Mortgage Applications w/e Sept 7th: +11.1% v -4.3% prior
- (US) Aug Import Price Index M/M: 0.7% v 1.5%e; Y/Y: -2.2% v -1.5%e
- (US) July Wholesale Inventories: 0.7% v 0.3%e
- (US) DOE Crude: +1.99M v -1.5Me; Gasoline: -1.18M v -1.5Me; Distillates: +1.48M v -1Me; Utilization: 84.7% vs. 86.2%e