Morning Minutes 11/14/2018

Natural Gas Rally, Canada Goose and Macys Earnings in Focus

November 14, 2018
8:45 am EDT

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Market Commentary By:
Colin Cieszynski, CFA, CMT
Chief Market Strategist
+1 (647) 282-4428

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Energy commodities continue to be the most active market out there this morning. WTI and Brent are trying to stabilize near $55.00/bbl and $65.00/bbl yesterday following yesterday’s huge 6%+ plunge. It remains to be seen if that big drop finally washed out the big sellers, but oil may remain active over the next couple of days regardless with API inventories due later today and DOE inventories tomorrow.

Natural Gas, meanwhile, is spiking upward again today, soaring 12.5% or over $0.50/mmbtu to trade above $4.50/mmbtu. It remains to be seen if this is a short squeeze or near-term buying climax but natural gas may remain active through tomorrow’s weekly storage report.

It’s another big day for earnings reports. Canada Goose has put out a particularly positive report, reporting EPS of $0.35, well above the $0.19 street estimate and $0.23 in the same quarter a year ago. Sales of $176 million were also well above expectations. Cineplex reported revenues of $386 million up 4.4% over year but a 40% decline in EPS.

In the US, Macys kicked off US retailer earnings season with positive results. Same store sales growth of 3.3% which was above the 2.8% street estimate propelled EPS to $0.27, nearly double the $0.14 street estimate. Management boosted its full year EPS guidance to $4.10-$4.30 from $3.95-$4.15.

Investors also have been shrugging their shoulders about news of a draft Brexit deal between the UK and EU. UK PM May is meeting with her cabinet to discuss the deal, it’s unclear how much support the agreement will have from her parties and allies when it comes to a vote in Parliament. Both the FTSE and the Pound are steady on the news suggesting that the street is taking a wait and see approach, especially since details haven’t been released as of yet and reaction from the EU side has been muted.

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