Sears shares tumble 15 percent on Wednesday as news broke that vendors were slowing or canceling shipments leading up to the holiday season. (1) Shares continued their downward slide on Friday – dropping an additional 2.88 percent to $7.42 – after Maxim Group downgraded the company’s shares from “hold” to “sell” – stating that even the department store’s lowered Q3 sales outlook was too optimistic. (2)
Trader uncovers a little-known market sector that allowed him to turn 100,000 into $1.4 million in less than an hour a week – read the full story here. For the third time this year, the International Monetary Fund cut its world economic growth forecasts – reducing this year’s estimate from a growth of 3.4 percent to 3.3 percent and next year from 4 percent to 3.8 percent – as growth in the euro zone, Japan, Brazil, and Russia deteriorates. (3)
Economic Releases & Statistics
U.S. job openings climbed from 4.61 million to a 13-year high of 4.84 million in Aug. – beating forecasts of 4.7 million openings – as the hiring rate fell from 3.6 percent to 3.3 percent. (4) U.S. retail sales over the holiday season are expected to rise by the most in 3 years – jumping 4.1 percent to $617 billion – as a more optimistic view on the labor market boosts consumer sentiment. Online sales are projected to rise 11 percent to $105 billion. (5) The U.K. economy grew just 0.7 percent during the third quarter – down from a Q2 advance of 0.9 percent – as manufacturing output slowed. (6) However, despite the slowdown, growth on a year-on-year basis still stands 3.1 percent higher. (7) Germany’s leading economic institutes cut their economic growth forecast for both this year and next – reducing this year’s estimate from 1.9 percent to just 1.3 percent and next year from 2 percent to 1.2 percent – calling for increased government spending. (8)
Stocks & Earnings
PepsiCo’s Q3 profit rose 5 percent to $2.01 billion or $1.32 a share, as total revenue jumped 2 percent to $17.22 billion on strong overseas sales. Adjusted earnings of $1.36 a share beat forecasts of $1.29 – sending shares to an all-time high of $95.52. (9) Students of Open Trader’s Ziad Masri are bringing in profits of over $100,000 a month with his new unconventional trading strategy – read the full story here. Costco shares climb to a record high of $128.95 after reporting better-than-expected Q4 results. (10) Net income for the quarter rose 13 percent to $697 million or $1.58 a share – surpassing forecasts of $1.52 – as same-store sales advanced 7 percent. (11) Alcoa’s Q3 income, excluding 1-time items, surged 70 percent to $370 million or $0.31 a share – easily exceeding forecasts of $0.21 – as revenue jumped 8.2 percent to $6.2 billion on higher aluminum prices. (12) Following the results, Alcoa’s shares climbed 2 percent to $16.42 – bringing the company’s year-to-date advance to 50 percent. (13)
The U.S. dollar fell to a 3-week low of 107.53 against the yen this week, as “investors pushed back bets for when the Federal Reserve will increase interest rates.” (14) For a limited time, trader shares how he uses weekly options to create a solid weekly income – gain free access to this live web event here. The Bank of England held its key interest rate at a record-low 0.5 percent this week, on signs that global economic growth may be losing momentum. (15) In an attempt to stimulate the economy, Poland’s central bank unexpectedly cut its benchmark rate from 2.5 percent to 2 percent. Economist had expected the rate to remain unchanged. (16) The Reserve Bank of Australia held its key rate unchanged and in line with forecasts at a record-low 2.5 percent, as economic growth remains moderate. (17)
Oil & Energies
According to Wednesday’s EIA report, the nation’s crude oil supplies rose by a larger-than-anticipated 5 million barrels to 361.7 million barrels compared to forecasts for a build of 2 million barrels. Gasoline supplies unexpectedly rose by 1.18 million barrels to 209.7 million barrels versus forecasts for a draw of 500,000 barrels. Distillates also made an unexpected advance – rising 439,000 barrels to 126.1 million versus to forecasts for a draw of 1.25 million barrels. (18)
Natural gas storage rose by 105 billion cubic feet to 3.21 trillion cubic feet last week – missing forecasts for a build of 108 billion cubic feet. Supplies now stand 10.1 percent lower year-on-year and 10.5 percent below the 5-year average. (19)
Grains & Field Crops
In its most recent WASDE release, the USDA raised its domestic corn production estimate from 14.395 billion bushels to a record 14.475 billion bushels, as positive weather conditions sends yields up from a previous forecasts of 171.7 bushels an acre to 174.2 bushels. (20) Soybean production is also forecasted higher at a record 3.927 billion bushels, as yields rise to a record 47.1 bushels an acre. (21) The agency unexpectedly reduced its world wheat stockpile projection by 1.9 percent – calling for inventories to reach 192.59 million metric tons by the start of the 2015 season. Analysts had called for stockpiles to rise from a previous estimate 196.38 million tons to 196.49 million. (22) Cotton prices have tumbled 23 percent this year, hitting a 5-year low, and are expected to plunge an additional 16 percent to $0.54 a pound, as domestic production climbs 28 percent to a 2-year high of 16.54 million bales and China reduces imports due to their own record harvest of 62.91 million bales. (23)
After falling to a current-year low of $1,183.24 an ounce, gold rebounded to hit a 3-week high of $1,225.30 an ounce after Fed Reserve minutes “revealed officials were worried that weak overseas growth and a strong dollar could hamper the U.S. economic recovery” – adding to bets that an early hike in U.S. interest rates would be unlikely. (24) However, despite the rally, BMO Capital Markets lowered its gold price forecasts for both 2015 and 2016 – cutting 2015’s estimate from $1,275 to $1,190 an ounce and 2016 from $1,250 to $1,238 an ounce. (25)
Coffee prices soared nearly 9 percent to a 2-1/2 year high of $2.29 a pound this week, as forecasts out of Brazil call for dry conditions to continue – further damaging crops. (26) According to the National Coffee Council, production will fall as much as 18 percent to 40.1 million bags this year. (27) Coffee output in Vietnam is expected to rise from a previous forecast of 1.65 million metric tons to a near-record of 1.69 million tons in the 12 months started Oct. 1, as favorable weather boosts yields. Last year’s harvest came in at an all-time high of 1.71 million tons. (28) Ivory Coast cocoa output is expected to exceed last season’s record of 1.74 million tons – hitting a new record of 1.8 million metric tons – as positive weather continues to aid production. (29)
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