10 Things You Need To Know Before The Opening Bell

10 Things Before Opening Bell

April 23, 2014

Good morning! Here's what you need to know.

Apple Earnings. Coming in after the closing bell. "People (including ourselves) are getting impatient with Apple and Tim Cook," BI's Jay Yarow says. "Apple's revenue growth has cratered and is now expected to be flat compared to a year-ago's sales." Read our full preview here »

Facebook Earnings. Also after the bell. "We remain constructive on Facebook shares given positive feedback from our recent checks as well as solid user growth and engagement trends,” Wedbush analyst Shyam Patil told clients in a note per Marketwatch. “We believe the company has multiple catalysts ahead, including the recently introduced video ads and Instagram monetization.”

Gilead Soars. Shares in the drugmaker are popping nearly 4% before the bell after they announced yesterday afternoon they'd sold a massive $2.27 billion-worth of its new hepatitis C drug Sovaldi. That crushed expectations for $1.13 billion in sales.

China PMI Ticks Up. The reading for April hit a two-month high but at 48.3 is still contracting. ""Domestic demand showed mild improvement and deflationary pressures eased, but downside risks to growth are still evident as both new export orders and employment contracted," said Hongbin Qu, HSBC chief economist for China, in a press release.

Data. At 9:45 a.m. we get a flash reading for PMI manufacturing for April. Consensus expectation is for a 0.8 point jump to 56.3. At 10 a.m. we get new home sales for May, which are expected to have climbed 15,000 to 455,000.

Markets. Stocks in Asia were mostly higher, led by the Nikkei at 1%. They were down in Europe. U.S. futures were higher. Gold and silver were higher.

Stronger Europe Business Activity. The Flash PMI for the region hit a new 35-month high in April. Peripheral Europe saw its fastest pace of growth since May 2011, according to the report.

Scalding Coffee Futures. Another commodities house cut its Brazilian coffee yield forecast, the Wall Street Journal said, sending futures close to 3% higher for a 26-month high. We are now approaching a year-to-date doubling of prices.

Ackman Herbalife Payoff. ABC reported Bill Ackman secretly promised to pay a former Herbalife exec up to $3.6 million if he lost his job providing information to the government or media.

Record Junk Bond Deal. A French cable operator is set to raise nearly $12 billion in debt in what the Wall Street Journal says is the largest junk bond deal ever. Numericable has a credit rating of triple C in the U.S.. "The [Numericable] deal is another milestone for the market," said Ben Pakenham, a fund manager at Aberdeen Asset Management, which oversees £186.5 billion ($313.2 billion) of assets, according to the journal. "It shows how much the market is growing and the level of demand there is to take down these bumper deals."

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Below is an interview with Manuj Nikhanj, Head of Energy Research at ITG.

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BI: What is the most underreported story in the unconventional world?

West Virginia Utica Shale dry gas potential.

BI: What plays are closest to turning over into their next phase (either higher or lower production?)

MN: Midland (Texas) Basin Horizontals development should drive oil production growth. Delaware Basin Wolfcamp (Texas) horizontal are a few years behind but also should be a contender.

BI: What processes will see the greatest efficiency gains this year?

MN: We will likely see drill times continue to be driven down and a focus on cost control on completion activity.

BI: If there were a figurative "league table" among drillers who is likely to emerge on top in 2014 and why?

MN: We don’t follow drillers, but if you are referring to E&Ps (exploration and production companies): Pioneer (PXD), Range Resources (RRC), Gulfport (GPOR), EOG, and Carrizo (CRZO).

BI: What are the biggest unknowns heading into the next few years?

MN: How bad the differentials will be in Appalachia and the impact that will have on growth out of the Marcellus and Utica Shales.

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