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Last Call: Mad Men, Raises & Operation Twist

Apple
Bertrand Langlois | AFP | Getty Images
Apple

Peter: I don't even know if I'm getting a raise. I didn't ask. I forgot.

Trudy: That's very noble. You see? One doesn't need money to be fulfilled.

-Mad Men

- Below, the folks at Sterling Cooper Draper Pryce may not need money to be fulfilled, but Apple store employees and Queen Elizabeth are getting a raise.

Market Musings With CNBC Market Guru Robert Hum

  • Post-Fed gyrations: Fed twists, stocks turn lower…then higher after Fed’s midday announcement
  • Stocks fade again as Ben Bernanke speaks mid-afternoon, then pare losses late in day
  • Although Dow, S&P end lower, Nasdaq edges higher, rises for 5th straight day
  • Crude oil drops below $81 for first time since October 6

The Word On The Street Tonight

FED EXTENDS 'OPERATION TWIST,' CITING CONCERNS ON ECONOMY/CNBC.com w/ Reuters: "The Federal Reserve, worried about the US economic recovery and Europe's continued debt crisis, decided Wednesday to extend the stimulus program known as "Operation Twist" through the end of this year. Stocks initially fell on disappointment that the Fed offered no additional easing, but the market soon rebounded on hints the central bank is still weighing such a move. In a significant change in the post-meeting statement, the Fed said it is "prepared to take further action," a stronger sign that there may be a third round of quantitative easing, or QE3."

THE FED'S SOFT LAUNCH OF QE3/WSJ – Justin Lahart: “It is unlikely that the Federal Reserve's efforts to boost the economy will end with "Operation Twist." The Fed's rate-setting committee decided Wednesday to extend its so-called Twist operations. These involve it selling short-term Treasurys and using the funds to buy long-dated ones. The goal is to bring down long-term interest rates. The extension of Twist assuaged markets, which had expected action along those lines. But the Fed also lowered the bar for further efforts, noting in its statement that it was ready to do more to promote "a stronger economic recovery and sustained improvement in labor-market conditions."

WHAT THE RECENT PLUNGE IN OIL PRICES MAY BE SIGNALING/CNBC: Lee Brodie: “Traders are always looking for a major market ‘tell’ and CNBC's Fast Money pros think it’s coming from the crude markets. Oil prices tumbled on Wednesday to their lowest levels in a year and a half, with declines extending into the close, even as the S&P moderated and pared losses.”

BED BATH OUTLOOK HITS SHARES/WSJ – Joan Solsman & Ben Fox Rubin: “Bed Bath & Beyond Inc. surpassed expectations with a 15% increase in profit in its fiscal first quarter, but a downbeat outlook, middling same-store sales growth and narrower gross margin were a departure from company tradition. Shares of the home-furnishings retailer were down 11% in after-hours trading Wednesday to $65.88. The stock has been tracking all-time highs recently, enjoying an upward swing since 2009 and reaching its latest apex at $75.84 Tuesday.”

RED HAT FORECASTS WEAK 2ND QTR, SHARES FALL/Reuters – “Red Hat Inc , the world's largest distributor of Linux operating software, forecast second-quarter revenue below Wall Street estimates after quarterly billings fell short of analysts' expectations. Shares of Red Hat fell 10 percent in after-market trading.”

WHAT MAKES JEFF BEZOS TICK? A $42 MILLION CLOCK, FOR STARTERS/WSJ – Stu Woo: “…he is a bit more willing to discuss his project to build a 200-foot-tall clock designed to last millennia. He has financed a group, the Long Now Foundation, that is building what he calls "The 10,000 Year Clock" deep inside a mountain on his West Texas property, not far from his rocket-launch site. It's like a grandfather clock on a grander scale, Mr. Bezos said. When it's finished, it will play an elaborate cuckoo-like sequence for the anniversary of every year, decade, century, millennium and 10 millennia. People who visit the clock when it is finished years from now will also be treated to a daily chime sequence that has been choreographed by musician Brian Eno, who serves on the project's board. "The reason I'm doing it is that it is a symbol of long-term thinking, and the idea of long-term responsibility," said Mr. Bezos, who has spent at least $42 million on the timekeeper.”

GOOD HUMOR SHORTAGE PUTS ICE CREAM MAN IN BAD MOOD/AP: “As the first heat wave of summer broiled the Northeast on Wednesday, fans of Good Humor's classic Toasted Almond Bar found a shortage of sweet relief. Parent company Unilever PLC said a sales spike during the unusually warm spring and challenges linked to next month's closing of its Hagerstown manufacturing plant have limited its ability to supply ice cream trucks with Toasted Almond, Candy Center Crunch and Chocolate Eclair bars — treats especially popular in the Northeast.”

COCA-COLA TO DISTRIBUTE HIGH-PROTEIN MILK SHAKE IN US/WSJ – Mike Esterl: “Coca-Cola Co. is moving into dairy products in the U.S. through a distribution pact for a high-protein workout-recovery shake for athletes and fitness buffs. The beverage giant will deliver Core Power, a small drink brand owned by a cooperative of nearly 90 family-owned dairies, to stores in a handful of states on its trucks starting in July.”

RAISES IN STORE AT APPLE/WSJ - Ian Sherr: “Apple Inc. is raising hourly pay for employees at its U.S. retail stores by as much as 25%, following an internal review period earlier this year. Apple employs the equivalent of 36,000 full-time staffers at its more than 350 retail stores around the globe. About two-thirds of the stores are in the U.S. Apple Store workers are typically paid about $9 to $15 an hour at the sales level, and up to about $30 an hour at its "Genius" tech support teams.”

BRITAIN'S QUEEN ELIZABETH GETS BUMPER PAY RISE/Reuters – Brenda Goh: “Britain's Queen Elizabeth has another reason to be cheerful in her Diamond Jubilee year - her annual pay is about to jump by 20 percent to 36 million pounds. Her property holdings, known as the Crown Estate, posted a record profit of 240.2 million pounds ($377.4 million), a net rise of 4 percent in the year through March 2012 largely due to strong tenant demand for its shops in the upmarket Regent Street and St James's districts of London.”

BCS COMMISSIONERS REACH CONSENSUS ON PLAYOFF PLAN/AP: “Bowl Championship Series commissioners reached a consensus on a model four-team seeded playoff that will be presented to the university presidents next week for approval. The commissioners who have been working on reshaping college football's postseason to create the first major college playoff met for four hours and emerged together with a commitment to stand behind a plan.”

Economic Data

830am et Initial Claims

900am et Jun Markit Flash PMI

1000am et May Existing Home Sales

1000am et Jun Philadelphia Fed Mfg Svy

1000am et Apr FHFA HPI

1000am et May Leading indicators

1630pm et Fed Balance Sheet

1630pm et Money Supply

Earnings

Before the bell:

CarMax, ConAgra, Rite Aid

After the bell:

None expected

Key Guests

Jon Hilsenrathe, Chief Economics correspondent, WSJ (6:30am)

Boris Schlossberg, Managing Director, BK Asset Management (7:30am)

Helena Morrissey, CEO, Newton Investment Management (8am)

Brian Nagel, Senior Equity Analyst, Oppenheimer & Co (10am)

Mark Kiesal, PIMCO (10:40am)

Erick Ristuben, Chief Investment Strategist, Russell Investments (11am)

Rep. Tim Huelskamp (R) Kansas, Budget Committee (11:20am)

Barry Knapp, Head of U.S. Equity Portfolio Strategy, Barclays (12:30 pm)

Donald Yacktman, Pres & CIO, Yacktman Asset Management (12:30pm)

Michael Hasenstab, Senior VP, Franklin Templeton Fixed Income Group (1pm)

Mike McCue, Founder & CEO, Flipboard (1:20pm)

Dan Fuss, Vice Chairman & Portfolio Manager, Loomis Sayles (1:30 pm)

Matt McLennan, Head of Global Value, First Eagle Global (2pm)

Steve Carley, CEO Red Robin Gourmet Burgers (2pm)

George Gatch, CEO, Investment Management Americas for JP Morgan Asset Management (3pm)

Larry Kantor, Managing Dir & Head of Research, Barclays (3:30pm)

Brian Edmonds, Head of Interest Trading, Cantor Fitzgerald (4:50pm)

Gary Thayer, Chief Macro Strategist, Wells Fargo Advisors (4:50pm)

Jim Whitehurst, Pres & CEO, Red Hat (5pm)

Michael Murphy, Managing Partner & CEO Rosecliff Capital (5pm)

Sen John Barrasso (R) Wyoming (7pm)

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