Bob Pisani is off today, this post was written by CNBC producer Robert Hum
The commodity/dollar trade continues today. Stock futures fell about 4 points pre-open as the dollar firmed and as commodities moved off their highs. Despite the move lower, commodities remain up on the day, rebounding from yesterday’s weakness. Subsequently, commodity stocks are slightly higher today, rising 1 percent-2 percent pre-open.
Traders are abuzz this morning on the question of if there will there be another U.S. stimulus package. A couple of separate reports suggest another package may be considered in the future.
1) Speaking at a seminar in Singapore, one of President Obama’s economic advisors, Laura D’Andrea Tyson, hinted that she felt the government should plan “on a contingency basis for a second round of stimulus.”
2) Additionally, in an interview in Moscow, thePresident himself reportedly said he wouldn’t rule out a second stimulus proposal at this time.
1) Discover Financial Services is down 8 percent pre-open after the credit card issuer announced a $500 million common stock offering. The proceeds from capital raise will be used for “general corporate purposes.”
2) Weyerhauser fall 2.5 percent after slashing its dividend 80 percent to 5 cents per share from 25 cents in an effort to help preserve capital. Additionally, the lumber company said it was considering a possible REIT conversion in the future.
3) Another sign that a strong recovery may be far off:
In a research note, JPMorgan warns that "rail volume performance in 2Q has come in well below our forecasts" and consequently cuts Q2 earnings estimates for several major railroads. Additionally, it’s “resetting” estimates for the rest of this year and all of next year, reducing volume expectations and earnings forecasts.
4) Intel rises 2 percent pre-open after Bank of America-Merrill Lynch upgraded it to a “buy” as it sees a “definitive turn in end demand.” Additionally, the brokerage firm raises its 2010 semiconductor industry growth projection to 21 percent from 14 percent due to “an improving trajectory of electronic demand.”
5) Keycorp is up 3 percent pre-open following an upgrade by KBW. The brokerage firm cites the regional bank’s valuation and strong capital levels as reasons for the new “overweight” rating.
6) Credit card and loan delinquencies continue to rise to record levels as more people lost jobs and fell behind in their payments. American Bankers Association Chief Economist James Chesesn also said to “expect elevated delinquencies” ahead as job losses continue to mount over the next year.
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