Wall Street Focusing On Dovish Bernanke Comments
U.S. stocks are poised for a higher open this morning, after Fed Chairman Ben Bernanke said the economy still needs the Fed's accommodative monetary policies. His comments in a speech after yesterday's close immediately pushed stock futures higher, and they'll continue to be a focus this morning.
The markets will have a few economic reports to consider as well, including the Labor Department's weekly report on initial jobless claims at 8:30 a.m. ET. Economists expect 335,000 new claims for the week ending July 6, down from 343,000 the week before. We'll also get June figures on import and export prices at 8:30 a.m. ET.
At 2 p.m. ET, the Treasury reports the monthly budget statement for June, expected to show a rare surplus. Economists are looking for a $40.0 billion surplus for the month, compared to a $59.7 billion deficit in the same month a year ago. The surplus is largely due to a payment from mortgage provider Fannie Mae, although growth in income tax collections is also a factor.
The Treasury will sell $13 billion in 30-year bonds, with the results of that sale due shortly after 1 p.m. ET. Yields in recent note and bond auctions have been consistently coming in at the highest in two years or more.
The Energy Department will be out with its weekly assessment of natural gas inventories at 10:30 a.m. ET.
Insurer Progressive (PGR) is among the few companies set to release corporate earnings this morning, while Peregrine Pharmaceuticals (PPHM) and Rocky Mountain Chocolate Factory (RMCF) are among the few after-the-bell reports due.
Yum Brands (YUM) is among our stocks to watch, as the parent of KFC, Taco Bell, and Pizza Hut reported second quarter profit of $0.56 per share, two cents above estimates. Revenues were slightly shy of consensus, and the company's sales in the important China market fell 20 percent. But the restaurant operator does project positive comps for China by the fourth quarter.
Walgreen (WAG) increased its quarterly dividend by 14.5 percent to 31-1/2 cents per share. The new dividend is payable September 12 to shareholders of record on August 20.
Apollo Group (APOL) saw accreditation renewed for its University of Phoenix online university. The government's Higher Learning Commission reaffirmed the schools accreditation through 2022-23, though it remains on "notice" status for two years due to concerns about its administrative structure.
Hewlett-Packard (HPQ) is no longer the world's biggest PC seller, according to new rankings from Gartner. That honor goes to China's Lenovo, although it's first in a rapidly shrinking market. According to research firm IDC, global shipments fell 11 percent from a year earlier, the fifth straight quarterly decline.
BlackBerry (BBRY) has seen two more key executive departures, with T.A. McCann and Marc Gingras leaving the company. McCann's contact management company Gist had been bought by BlackBerry in 2011, while Gingras' social calendar company Tungle.me was acquired the same year.
Vivus (VVUS) investor QVT Financial will vote for dissident investor First Manhattan's proposed slate of directors, according to Reuters. QVT Financial owns 8.3 of Vivus, best known for the obesity drug Qsymia.
Microsoft (MSFT) is expected to announce a major restructuring today, focusing the company around devices and services.