What’s the Story

Reuters

Stock index futures eased on Wednesday as weak export data from Japan underscored the headwinds facing the global economy, while Greece was beginning a series of meetings with European officials aimed at securing more time to push through reforms.

Japan’s exports slumped the most in six months in July as shipments to Europe and China tumbled, adding to concerns over global demand after a string of dire trade figures from Asia’s export engines.

Greek Prime Minister Antonis Samaras starts a European charm offensive with talks to persuade euro zone chief Jean-Claude Juncker that the debt-laden nation has the will to ram through unpopular reforms and deserves more time to do it.

FT

European and Asian shares are dipping from recent highs on renewed wariness over the global economy and an overnight fall on Wall Street.

The FTSE All-World equity index is down 0.4 per cent as the FTSE Eurofirst 300 sees a loss of 0.9 per cent and after the Asia-Pacific region retreated 0.5 per cent.

The retracement in stocks is encouraging funds to move back into fixed income “havens”, many of which had experienced determined selling in recent weeks. The yields on 10-year US and German sovereign paper are down 3 basis points to 1.77 per cent and 6bp to 1.50 per cent, respectively.

Other assets are also adhering to the risk-off theme. Copper is down 0.6 per cent to $3.43 a pound and Brent crude off 99 cents to $113.65 a barrel.

Similar moves can be seen in currencies. The euro is hovering just shy of a seven-week high but down 22 pips to $1.2448, and the dollar index is up 0.2 per cent.

But gold is up $1 to $1,639 an ounce after hitting a fresh three-and-a-half-month high of $1,645 earlier in the session.

CNBC

The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity, which includes both refinancing and home purchase demand, fell 7.4 percent in the week ended Aug 17.

The index of refinancing applications lost 9.2 percent, the third week in a row the measure has declined.

The gauge of loan requests for home purchases, a leading indicator of home sales, held up better, rising 0.9 percent.

The refinance share of total mortgage activity slipped to 80 percent of applications from 81 percent. Fixed 30-year mortgage rates jumped 10 basis points to average 3.86 percent. Even with the increase, rates are still at relatively cheap levels after falling to record lows in recent months.

Bloomberg

Commodities entered a bull market, gaining 21 percent from a June low, as grain prices surged after the most severe U.S. drought in half a century and as crude oil rallied amid increased tension in the Middle East.

The Standard & Poor’s GSCI Spot Index of 24 raw materials rose 0.9 percent to end at 675.55 yesterday in New York. The gauge has jumped from this year’s lowest close of 559 on June 21. A gain of more than 20 percent is the common definition of a bull market. Crude accounts for more than 50 percent of index.

Soybeans rose to a record yesterday, and corn soared 66 percent since mid-June. The U.S. Department of Agriculture has declared almost 1,600 counties in 32 states as natural-disaster areas after the drought seared millions of acres of cropland.

Calculated Risk

• At 10:00 AM, Existing Home Sales for July is scheduled for release by the National Association of Realtors (NAR). The consensus is for sales of 4.50 million on seasonally adjusted annual rate (SAAR) basis. Sales in June 2012 were 4.37 million SAAR.

• At 2:00 PM, the FOMC Minutes for the meeting of July 31-August 1, 2012 will be released. Once again the minutes will be closely scrutinized for hints about QE3.

CNBC

Toll Brothers [TOL  31.81        ]– The home builder earned $0.36 per share for its fiscal third quarter, doubling Street estimates. Its revenues also came in above consensus, and its revenue from signed contracts was up 57 percent from a year earlier.

Sunrise Senior Living [SRZ  8.93        ] – The builder of assisted living facilities is being bought by Health Care REIT [HCN  59.75        ] for $14.50 per share cash, a 62.4 percent premium over Tuesday’s close.

Dell [DELL  12.34        ] – The computer maker earned $0.50 per share for the second quarter, five cents above estimates, but revenue fell short of consensus. Dell’s fiscal-year forecast of $1.70 per share is shy of the $1.90 consensus estimate from analysts, and its third quarter sales projections are also below estimates. Dell’s forecast is seen as a reflection of the shift from desktop and laptop computers to smartphones and tablet computers.

Intuit [INTU  58.95        ] – Intuit reported fiscal fourth-quarter profit of $0.03 per share, half of the $0.06 that analysts were projecting. The software maker’s revenue also fell slightly short of forecasts, although the maker of the popular Quicken and TurboTax software packages did raise its quarterly dividend by 13 percent. It’s also forecasting first-quarter revenue below analysts’ estimates.

Williams-Sonoma [WSM  38.23        ] – The housewares retailer earned $0.43 per share for the second quarter, two cents above estimates, with sales also coming in above forecasts. It sees current-quarter earnings of $0.43 to $0.46 per share, compared to estimates of $0.43 per share.

Analog Devices [ADI  40.34        ] – The chipmaker matched Street estimates with quarterly profit of $0.56 per share, but the company’s fiscal third-quarter sales are below estimates, and its projected current-quarter profit of $0.54 to $0.60 per share falls largely below the consensus forecast of $0.60. This comes as a weaker global economy cuts demand for semiconductors.

Fifth Third Bancorp [FITB  14.39        ] – The bank said the Federal Reserve (explain this) is not objecting to its latest capital plan, which includes share buybacks and a possible dividend increase.

Lorillard [LO  127.88        ] – Lorillard is authorizing up to $500 million in share repurchases, with the tobacco company setting no expiration date for the plan. It completed a $750 million repurchase plan earlier this year.

CVR Energy [CVI  29.55        ] – Investor Carl Icahn withdraws his $29 per share offer to buy the oil refiner. He currently controls about 82 percent of CVR’s outstanding shares.

Jury deliberations are set to begin today in the patent trial pitting Apple [AAPL  656.062        ] against Samsung. The deliberations come after meetings between the CEOs of the two companies failed to produce a resolution.

BHP Billiton [BHP  69.49        ] – BHP is reporting an annual profit drop of nearly 35 percent. The world’s biggest miner has been impacted by weaker commodity prices.

Chico’s FAS [CHS  17.08        ] – The apparel retailer reported quarterly profit of $0.32 per share for the second quarter, two cents above estimates, while Chico’s reported a 5.6 percent increase in same-store sales.