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Frontrunning: October 26

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  • Incoming ECB head gives euro zone pre-summit boost (Reuters)
  • Fears Euro Summit Could Miss Final Deal (FT)
  • Merkel Puts Rescue Fund to German Vote (Bloomberg)
  • Iron ore in record slide as China demand slows (Reuters) BHP, Rio CDS Soar
  • MF Global slumps 47% on unexpected loss (FT)
  • Bankers fear political moves will kill off CDS (FT)
  • EU Banks Warn of Credit Drought in Push for Capital (Bloomberg)
  • Analysis: Obama's moves pack political rather than economic heft (Reuters)
  • BOE: QE May Not Boost Bank Lending (WSJ)
  • Olympus chairman resigns, watchdog probes firm (Reuters)
  • Yuan Rise Won’t Erase US Trade Deficit (Reuters)

European economic summary:

  • Germany Import Price Index for September 0.6% m/m 6.9% y/y – in line with expectations. Consensus 0.6% m/m 6.9% y/y. Previous -0.7% m/m 6.6% y/y.
  • France Business Survey Overall Demand for October 2.0. Previous 16.0.
  • Italy Business Confidence for October 94.0 – in line with expectations. Consensus 94.0. Previous 94.5.
  • Sweden Trade Balance for September (Kronor) 11.9B – higher than expected. Consensus 7.5B. Previous 5.3B. Revised 6.4B.
  • UK CBI Trends Total Orders for October -18.0 – lower than expected. Consensus -7.0. Previous -9.0.
  • UK CBI Trends Selling Prices for October 1.0 – lower than expected. Previous 13.0.
  • UK CBI Business Optimism for October -30.0. Previous -16.0.

Global highlights courtesy of Egan-Jones:

  • Home prices in 20 US cities dropped more than forecast in August.
  • Japan, Australian shares fall after Europe Summit canceled.
  • Merkel puts rescue fund to German vote.
  • US consumer confidence unexpectedly drops to two-year low.
  • 3M lowers FY EPS outlook to $5.85-5.95 (prev $6.10-6.25) on slowing global growth.
  • ACE Limited posts Q3 EPS of $2.22 (cons $1.77); revs rose 31.8% to $4.34B.
  • Amazon Q3 net drops 73% on heavy spending on warehouses, data centers.
  • Amazon sees Q4 operating loss $200M to operating income $250M vs. est. $512.7M.
  • American Fincl beats by $0.08; reaffirms FY11 EPS above consensus.
  • ArcelorMittal backs out of MacArthur coal purchase.
  • Boston Properties beats by $0.05, beats on revs; guides Q4 FFO below cons.
  • Broadcom Q3 profit falls 18% on rising costs; outlook falls short of estimates.
  • Cardinal Health to acquire Futuremed Healthcare Products Corp. for about C$124.5M cash.
  • Coach Inc.'s Q1 profit rises by 14% to $215M as revs rose 15% to $1.05B.
  • CR Bard Inc. to acquire Medivance Inc. for $250M.
  • Cummins slashed its profit, sales outlook for 2011, cites macroeconomic uncertainty.
  • Delta Q3 results falls short on higher costs, weaker traffic.
  • DreamWorks Animation's Q3 earnings dropped 51%, hurt by soft sales of DVDs.
  • DuPont's Q3 net jumps 23% to $452M as revs grew by 32% to $9.2B, on higher prices.
  • KKR & Co. is seeking as much as $6B or its second Asian buyout fund.
  • Manitowoc beats by a cent; Q3 EPS at $0.18. Revs rose 15.9% to $935.4M.
  • McKesson's Q2 net falls 9.4% to $296M undercut by legal settlement, results beat est.
  • MetLife says Fed rejects plan for dividend increase, buybacks.
  • MF Global shares plunge after posting biggest-ever quarterly loss of $38.8M.
  • PolyOne's Q3 net comes in at $21.6M, misses forecasts. Revs rose 8% to $735.8M.
  • RailAmerica beats by $0.02, posts Q3 EPS of $0.24. Revs rose 8.9% to $139.7M.
  • Rayonier Inc. Q3 profit grew 67%, buoyed by higher revenue and a tax benefit.
  • Reynolds American's Q3 net falls 4% to $367M on legal charges, other costs.
  • TD Ameritrade posts 44% jump in Q4 profit as market turmoil drives heavy trading.

Economic Calendar: Data on Durable Orders, New Home Sales, Crude Inventories to be released.

Earnings Calendar: AEP, AFL, AGN, ATI, BA, CA, COP, EXC, F, GD, HES, ISIL, LMT, MHS, NOC, OI, PX, SYMC, TUP, V, WCAA, WLP.


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