Friday Morning Market Prepper
Turbulent Start to the New Yearl
China Aims to Spend at Least $360 Billion
China Ready to Step Up Scrutiny
Lampert’s on the Hook for $1.2 Billion
The December jobs report will be the first major data wrapping up 2016 and the economy's performance under President Barack Obama. Economists expect 178,000 jobs were added last month following a similar increase in November, while the unemployment rate likely increased slightly to 4.7%. The Labor Department will release the year-end snapshot at 8:30 a.m. ET.
China's central bank lifted the exchange rate against the greenback by the most since 2005, stepping up efforts to support the currency amid concerns over capital outflows from the world's second-largest economy. The PBOC set the official midpoint for the yuan at 6.8668 per dollar prior to the market opening, 639 pips or 0.9% firmer, than 6.9307 yuan on Thursday.
Soaring commodity prices helped Australia record its first trade surplus in almost three years, soaring to $1.2B in November following a surge in export earnings. The figure suggests the country might avoid a technical recession - a serious concern after last quarter's shock contraction in economic activity.
India's advance estimate of gross domestic product for the fiscal year through March will be released at 7 a.m. ET. It'll be the first official evidence of whether the government's decision in November to invalidate most of the country's currency sent the high-flying economy into a tailspin. Many economists estimate growth of around 6.5%, down from 7.6% the previous year.
Contracts for 'Made in Germany' goods were down 2.5% in November, but revised figures showed industrial orders surged 5% in October, the biggest rise since July 2014. That means over the two months, bookings rose by 3.5%. "These results together point to a very favorable development... in the final quarter of the year," the Economy Ministry said in a statement.
Further evidence has emerged to show the eurozone ended 2016 on a strong note following the extension of ECB stimulus. The European Commission's survey of economic confidence for the bloc rose 1.2 points to 107.8 in December, beating expectations for a reading of 106.8. That's the strongest reading since March 2011.
Strong chip sales and a smartphone rebound likely boosted Samsung Electronics's (OTC:SSNLF) operating income to 9.2T won ($7.8B) in the quarter ended December, its biggest profit in three years, the company said in preliminary results. The upbeat outlook comes despite a slight fall in revenue and the anticipated $2.1B profit hit from the withdrawal of its fire-prone Galaxy Note 7 in October.
Toshiba plans to meet with creditor banks on Tuesday to explain how it's addressing a massive charge the Japanese conglomerate said it must take on its U.S. nuclear business. Syndicated loans could be endangered because credit-ratings downgrades put Toshiba (OTCPK:TOSYY) in violation of loan covenants, three bankers told Reuters, adding that it was routine for them to grant a waiver in such a case to avoid a funding crisis.
The Japanese government has defended Toyota (NYSE:TM) as an "important corporate citizen" of the United States following a tweet by Donald Trump that threatened to slap punitive tariffs on its Mexico-built cars. The President-elect has repeatedly hit out at U.S. companies for using lower-cost factories abroad at the expense of jobs at home, but the tweet against Toyota was his first against a foreign automaker.
Apple is encroaching on Samsung's (OTC:SSNLF) backyard as it looks to open its first retail store in South Korea. Apple (NASDAQ:AAPL) has already listed hiring notices for 15 positions on its website, including a store leader and business manager. Construction is underway in a southern district of Seoul, according to the Yonhap News Agency, adding that the work will likely be completed by the end of November.
Pandora Media -4% premarket after a Sirius XM (NASDAQ:SIRI) executive dampened speculation about M&A as "not very likely." Pandora (NYSE:P) shares had gained in December amid increasing chatter about a tie-up. That followed summer reports that Liberty Global (NASDAQ:LBTYA) had floated a $15/share offer that looked like it was rebuffed, and comments from Liberty chief Greg Maffei that any streaming buy would be linked to Sirius XM.
A South Korean court has sentenced an executive of Volkswagen's (OTCPK:VLKAY) local unit to one year and six months in prison for fabricating documents on emissions tests to achieve import certification for vehicles. It's the latest fallout from Dieselgate, which resulted in a sales suspension in South Korea, a once fast-growing market for the German automaker.
After five years of investigations and negotiations, federal regulators have announced a $5M settlement with Jon Corzine, who ran MF Global when it collapsed into bankruptcy in 2011 and lost more than $1B in customer money. The agreement bars Corzine from ever working for a futures commission merchant or registering with the CFTC. He also won't be allowed to ask insurers to cover the fine.
Indonesia is considering curbs on negative research reports by foreign banks, building on its decision to punish JPMorgan (NYSE:JPM) for issuing a bearish call on local equities. The finance ministry may ask global institutions which hold primary dealerships in Indonesian sovereign bonds to sign pledges to refrain from issuing research that could "destabilize" the nation's financial markets.
Gap shares spiked more than 8% in extended trading after raising its earnings guidance for 2017 on strong same-store sales over the holiday period. In December, the clothing retailer's sales increased 4%, compared to a 5% decrease the previous year. Gap's (NYSE:GPS) overall revenue for the month rose 3% to $2B.
Wal-Mart has reached an agreement to continue accepting Visa (NYSE:V) credit cards in Canada, ending its threat to bar the payments network from its 409 stores in the country. Last summer, Walmart Canada (NYSE:WMT) said it would stop accepting Visa after a public dispute over what the retail giant called "unacceptably high" merchant fees.
Carlyle Group is exploring a sale of nutritional supplements maker Nature's Bounty, whose brands include MET-Rx and Pure Protein. The company could fetch as much as $6B, according to Bloomberg. While finding a buyer for the whole business is the preferred option, Carlyle (NASDAQ:CG) may also decide to shop the international unit separately.
Complicated takeover? Johnson & Johnson (NYSE:JNJ) and Actelion (OTCPK:ALIOY) have asked Switzerland's takeover board about a deal structure that would separate the latter's commercialized portfolio from its R&D assets, Tages-Anzeiger reports. That would allow J&J to acquire Actelion with a cash offer in the region of $260 per share, a little more than what it had offered when it walked away from negotiations in December.
Amgen shares climbed 5% AH after it won a ban on Sanofi (NYSE:SNY) and Regeneron's (NASDAQ:REGN) cholesterol drug, Praluent. The biopharmaceutical company had previously accused the two firms of infringing its patents. The judge's decision blocks sales of Praluent, stating that "irreparable harm" had been done to Amgen's (NASDAQ:AMGN) Repatha.
Indian budget airline SpiceJet is expected to order at least 92 Boeing (NYSE:BA) 737 jetliners, which could be valued at about $10.1B at current list prices, Bloomberg reports. Boeing is also due to report total order activity for 2016 later today, but analysts believe the world's biggest planemaker may fall short of order and delivery targets.
Low-cost carrier Frontier Airlines is preparing for an initial public offering and has hired Deutsche Bank, JPMorgan Chase and Evercore to manage the debut. The Denver-based airline is aiming to raise about $500M, valuing the company at about $2B, sources told NYT.
Verizon is still unsure whether it will proceed with its planned acquisition of Yahoo's (NASDAQ:YHOO) internet business. "Unfortunately, I can't sit here today and say with confidence one way or the other because we still don't know," said Marni Walden, president of product innovation and new businesses at Verizon (NYSE:VZ). Yahoo came under renewed scrutiny last month after disclosing the largest known data breach in history.
Greta Van Susteren is joining MSNBC (NASDAQ:CMCSA), taking over the channel's 6 p.m. time slot with a new show called For the Record. It's yet another major Fox News (FOX, FOXA) pickup for the NBC family, which on Tuesday announced that it had hired star anchor Megyn Kelly. Tucker Carlson, who had recently begun hosting a 7 p.m. show on Fox News, will take the 9 p.m. slot following the final edition of The Kelly File tonight.
In Asia, Japan -0.3%. Hong Kong +0.2%. China -0.4%. India -0.4%.
In Europe, at midday, London -0.1%. Paris -0.3%. Frankfurt -0.1%.
Futures at 6:20, Dow -0.1%. S&P flat. Nasdaq flat. Crude +0.6% to $54.10. Gold -0.2% to $1178.50.
Ten-year Treasury Yield -1 bps to 2.35%.Today's Economic Calendar
8:30 Non-farm payrolls
8:30 International Trade
10:00 Factory Orders
11:15 Fed's Evans: Monetary Policy
1:00 PM Baker-Hughes Rig Count
3:30 PM Fed's Kaplan: Economic Outlook