>>> Ford Motor (pre-announced) reports EPS in-line, beats on revs (8.34 -0.16)

Ford Motor (pre-announced) reports EPS in-line, beats on revs (8.34 -0.16)
  • Reports Q4 (Dec) earnings of $0.30 per share, excluding non-recurring items, in-line with the S&P Capital IQ Consensus of $0.30; revenues rose 0.5% year/year to $38.7 bln vs the $36.83 bln S&P Capital IQ Consensus.
    • As covered earlier this month, Ford provided preliminary EPS figures for Q4 that fell short of analyst estimates.
  • While auto operations reported a lower EBIT than a year ago, driven by China and Europe, all regions continued to focus on improving operational fitness while building on core company strengths. In Europe, Ford posted record SUV sales, while Ranger was the region's best-selling pick up, and Ford once again was the best-selling commercial vehicle brand. In the Asia Pacific region, India and Thailand achieved record full-year sales, and Lincoln set a new annual sales record for the fourth consecutive year in China.
  • Bob Shanks, Ford CFO, said Ford expects to be able to fully fund its business needs and capital plans in 2019, while maintaining cash and liquidity levels at or above its target levels. He added Ford sees the potential for year-over-year improvement in the company's key financial metrics as it works to close the gaps versus targets.
  • Q4 Slide Deck
    • For 2019 outlook, co calls for potential improvement from 2018

>>> Xilinx beats by $0.06, beats on revs; guides Q4 above consensus (89.55 -0.9

Xilinx beats by $0.06, beats on revs; guides Q4 above consensus (89.55 -0.90)
  • Reports Q3 (Dec) earnings of $0.92 per share, excluding non-recurring items, $0.06 better than the S&P Capital IQ Consensus of $0.86; revenues rose 33.6% year/year to $800 mln vs the $770.65 mln S&P Capital IQ Consensus. Data Center and Test, Measurement & Emulation (TME) revenues grew 14% year over year driven primarily by the Data Center business (ex-Cryptocurrency) and TME business, which both experienced double digit growth during the quarter. Communications revenues increased 41% year over year, driven by strength in the Wireless Communications business.
  • Co issues upside guidance for Q4, sees EPS of ~$0.92-0.99 (based on margin/expense/tax guidance assuming flat share count Q/Q), excluding non-recurring items, vs. $0.83 S&P Capital IQ Consensus; sees Q4 revs of $815-835 mln vs. $776.20 mln S&P Capital IQ Consensus

>>> Las Vegas Sands on Q4 call (47.29 +0.24)

Las Vegas Sands on Q4 call (47.29 +0.24)
  • CEO/Chairman Sheldon Adelson is under the weather, not on the call.
  • Macau growth coming from every segment; margins stable or growing except in rolling premium direct, which was negatively impacted by low hold (got unlucky).
  • Premium mass outperformed.
  • Remain bullish on Macau; region has absorbed a ton of capacity in recent years, keeps growing. New bridge will be a game changer.
  • Mass and premium mass will drive drive EBITDA growth as VIP will continue to struggle
  • Smoking ban is a speed bump; not a concern
  • Biggest issue in Singapore is capacity constraint
  • Bought back $430M in stock during the quarter

After hours: LVS -2%, WYNN -0.6%, MGM +0.6%, MLCO +0.4

>>> Teradyne beats by $0.13, beats on revs; guides Q1 in-line (31.93 +0.13)

Teradyne beats by $0.13, beats on revs; guides Q1 in-line (31.93 +0.13)
  • Reports Q4 (Dec) earnings of $0.63 per share, $0.13 better than the S&P Capital IQ Consensus of $0.50; revenues rose 8.6% year/year to $520 mln vs the $494.17 mln S&P Capital IQ Consensus.
  • Co issues in-line guidance for Q1, sees EPS of $0.39-0.47, excluding non-recurring items, vs. $0.46 S&P Capital IQ Consensus; sees Q1 revs of $460-490 mln vs. $481.65 mln S&P Capital IQ Consensus.
  • "We finished 2018 with strong fourth quarter sales above the high end of our guidance driven by upside demand in our Semiconductor and Wireless test businesses... In IA, Universal Robots' full year growth of 38%, while strong, was below our target due mainly to slowing demand in China and the automotive sector. MiR sales for the year more than doubled on a pro-forma basis."
  • As part of the $1.5 billion authorization established in January 2018, Teradyne purchased $823 million of its common shares in 2018 and expects to repurchase $500 million of its common shares in 2019

FT : Brussels to sue UK over tax breaks for commodities traders

Brussels to sue UK over tax breaks for commodities traders
Commission goes to ECJ over City of London creating VAT loophole

Brussels is to sue the UK in Europe’s highest court over tax breaks for commodities traders, according to EU diplomats briefed on the plans, escalating a battle that Britain said risked damaging the post-Brexit competitiveness of the City of London.

The European Commission is bringing the case in the European Court of Justice just over two months before Britain is due to leave the EU, potentially without agreeing an exit deal. However, the withdrawal treaty that Theresa May has brokered with Brussels means the UK would have to abide by ECJ rulings in cases launched while it was a member or during a 21-month transition period.

Brussels’ move to try to limit how the UK applies value added tax exemptions escalates a dispute that began last year when Brussels challenged the UK on rules dating back to the 1970s.

Under the rules, Britain has a right to apply a zero VAT rate to commodities contracts traded on “terminal markets” such as the London Metal Exchange.

Brussels argues that the UK has stealthily widened the exemption over time, creating a tax loophole that unfairly boosts the City of London at the expense of other EU financial centres. London is one of the largest global centres for commodities trading.

The commission declined to comment but last year said the UK had “extended the scope of the measure considerably . . . meaning that it is no longer limited to trading in the commodities as originally covered”.

Brussels contends that the UK has amended the original exemption at least eight times without seeking advice from the EU, so that it now includes trading commodity options and futures contracts.


Britain has consistently rebuffed the commission’s claims that the changes are illegal, saying its approach is in line with EU “standstill” rules that allow the zero rate because it was applied before a 1977 cut-off date.

The case comes at an acutely sensitive moment in Brexit talks, following the overwhelming parliamentary defeat of Mrs May’s deal and amid deep splits in the UK parliament over how to proceed. Mrs May is due to face a further crucial vote on her Brexit plans in the House of Commons next week.

It also underlines the complex task facing the UK Treasury to disentangle Britain and its businesses from an EU VAT system that has developed over decades.

While tax rates are mainly set at national level, Brussels tries to restrict how far governments can go in lowering VAT rates to lure business, while allowing countries to introduce specific carve-outs.

Brussels opened “infringement proceedings” against the UK on the issue last year, following talks between EU and UK officials dating back to 2015.

The UK government declined to comment but officials have previously said the VAT treatment was “vital” to ensure the City remained a world-leading hub for commodities trading.

FT : Billionaire Citadel founder snaps up most expensive US home for $238m

Billionaire Citadel founder snaps up most expensive US home for $238m

Billionaire hedge fund manager Ken Griffin, days after it was revealed he is buying a £95m home in London, has purchased the most expensive home ever sold in the US.

The Citadel founder paid $238m for the apartment, which overlooks Central Park in New York City at the 220 Central Park South luxury condominium development.

Mr Griffin has gone on a real estate buying tear as of late. The Georgian house in London, a Grade II*-listed 1820s home, is at No. 3 Carlton Gardens in the St. James neighbourhood, near Buckingham Palace.

The two purchases come during slumps in the luxury property markets in both cities, and a decline in the British pound due to Brexit.

Mr Griffin, 50, already owns an extensive portfolio of properties in the US, including four luxury condominiums in Chicago, where Citadel is based, six properties in the Palm Beach area in Florida, a $60m condo in Miami and two homes in Hawaii.

A spokesperson for Citadel had no comment.

Deborah Kern, a real estate broker at Corcoran, represented the developer on the building in the sale. She also recently sold the musician Sting’s apartment at 15 Central Park West for $50m.

>>> US Close Dow +0.70% S&P +0.22% Nasdaq +0.08% Russell -0.22% VIX -6.15%

Stock Market Wrap Up: Wall Street Mixed in Uneven Session

The S&P 500 gained 0.2% on Wednesday in what was an uneven day of trading. The benchmark index was up as much as 0.8% shortly after the start of trading, lost as much as 0.8% by midday, and teetered around its flat line for most of the afternoon.

The Dow Jones Industrial Average (+0.7%) and the Nasdaq Composite (+0.1%) also experienced similar price action. The Russell 2000 (-0.2%) did, too, but finished in negative territory. 

Most S&P 500 sectors finished higher with consumer staples (+1.2%) and utilities (+1.1%) outperforming. Conversely, the energy (-1.0%) and material (-0.7%) sectors underperformed the broader market and were the lone sectors ending with a loss.

Stocks had rallied at the open on some earnings beats and reassuring guidance from Dow components IBM (IBM 132.89, +10.37, +8.5%), Procter & Gamble (PG 94.84, +4.40, +4.9%), and United Technologies (UTX 117.04, +5.98, +5.4%).

With stocks recouping a good chunk of Tuesday's losses, there was some hope that the prior day's weakness was nothing more than a one-day pullback for an overbought market.

Market participants, however, would sell into strength, which resulted in a steady decline throughout the morning that left the S&P 500 below its 50-day moving average (2619). A dearth of buying interest, though, turned into a wave of buying interest soon after the S&P 500 violated its 50-day moving average. 

The 50-day moving average has proven to be an important technical support level the past two sessions, where an inflow of buyers has helped prevent selling efforts from getting too out of hand.

Sure enough, the S&P 500 ascended to its flat line in afternoon action despite the lingering concerns surrounding a U.S-China trade deal, global growth prospects, and a tense government shutdown.

In other corporate news, Comcast (CMCSA 36.89, +1.92) rose 5.5% after it beat beat top and bottom-line estimates and increased its dividend by 10% to $0.84 per share on an annualized basis for 2019.

U.S. Treasuries ended on a lower note, although the bulk of the session saw a steady climb off opening lows. The 2-yr yield increased two basis points to 2.59%, and the 10-yr yield increased three basis points to 2.76%. The U.S. Dollar Index lost 0.2% to 96.12. WTI crude lost 0.8% to $52.63/bbl.

Reviewing Wednesday's economic data, which included the FHFA Housing Price Index for November and the weekly MBA Mortgage Applications Index:

  • The FHFA Housing Price Index for November increased 0.4% (consensus 0.3%), unchanged from October's upwardly revised increase (from 0.3%).
  • The weekly MBA Mortgage Applications Index decreased 2.7% from the prior increase of 13.5% last week.

Looking ahead, investors will receive the weekly Initial and Continuing Claims report and the Conference Board's Leading Economic Index for December on Thursday.

  • Russell 2000 +7.8% YTD
  • Nasdaq Composite +5.9% YTD
  • Dow Jones Industrial Average +5.4% YTD
  • S&P 500 +5.3% YTD