History is repeating itself. According to Thackray’s 2010 Investor’s Guide, two of the weakest days in U.S. equity markets is the day before and the day after the U.S. Presidents’ Day holiday. The day before Presidents’ Day is typically the worst day with an average negative return and down 67% of the time. Presidents’ Day is held on Monday.
U.S. equity index futures are lower this morning. S&P 500 futures are down 5 points in pre-opening trade following news that the Chinese central government has taken steps to cool economic growth. Reserves requirements on deposits placed in Chinese banks have been raised.
Equity index futures also were negatively influenced by strength in the U.S. Dollar. Commodities priced in U.S. Dollars including crude oil, gold, copper and silver are trading lower.
U.S. equity index futures recovered slightly after better than expected January retail sales were released. Consensus was an increase of 0.3% versus a decline of 0.2% in December. Actual was an increase of 0.5%. Consensus for retail sales ex autos was an increase of 0.4%. Actual was an increase of 0.6%.
Analysts are taking a more positive stance on Metals & Mining stocks. This morning RBC Capital Markets upgraded Teck Resources from Sector Perform to Outperform. Credit Suisse upgraded Rio Tinto from Neutral to Outperform.
Analysts also are taking a more positive stance on energy stocks. This morning, Morgan Stanley initiated coverage on Southwestern Energy with an Overweight rating and a $60 target price. Canaccord upgraded Encana from Speculative Buy to Buy. Target was raised from $32 to $35.
Coverage on Procter & Gamble was initiated at Credit Suisse with an Outperform rating.
Ingersoll Rand is down 7% after reporting lower than consensus fourth quarter earnings and after offering lower guidance for the first quarter.
ManuLife fell 2% in overnight trading after RBC Capital Markets downgraded the stock from Outperform to Sector Perform.
Precision Drilling was unchanged after announcing a loss in the fourth
quarter. It also announced plans to convert from a trust to a
corporation.
Shaw Communications has arranged to purchase a controlling interest in CanWest Global Communications.
Don Vialoux, chartered market technician, is the author of a free
daily report on equity markets, sectors, commodities, equities and
Exchange-Traded Funds. For more visit Don Vialoux's Web site