Stock Futures Higher amid EU Optimism. Stocks to Watch: AEO, APA, AAPL, BAC, CSX, HAL, RIMM, TXN

Published on Monday, 23 January 2012 07:51 Written by Christopher Lynn

New York, January 23^rd  (TradersHuddle.com) – Stock futures were pointing to positive open at the start of a busy earnings-reporting week amid a jump in the euro against the Dollar, which was trading just above $1.30 level. The gains came ahead of a meeting of euro zone finance ministers and on optimism that a Greek debt swap deal would be completed.

In Asia, stocks struggled amid thin trading due to the Lunar New Year holiday in much of Asia, as Greece failed to reach a deal with private bondholders on a debt swap that will help the indebted country to avoid a disorderly default. In Australia, shares fell after a report last week suggested China’s manufacturing sector had a sluggish start of the year; miners were one of the worst performers on concern over metal demand from China. Meanwhile, In Japan, the Nikkei closed just barely in negative territory, snapping its 4-session winning streak. In China, the Shanghai Composite will be close all week for the Lunar Holiday.

In Europe, equity markets were gaining ahead of a meeting of finance ministers from the euro zone that aimed to discuss the terms of the Greek debt restructuring deal. A report from the Financial Times helped provide upside momentum to banks, as it cited that both Germany and France have called for a relaxations of global banking capital rules to prevent lending from drying up. However the lack of a swap deal with private bondholders of Greek debt weighed on sentiment.

The euro was jumping 1.1% against the Dollar, trading just above the $1.30 level. Crude oil was gaining 0.61% to $99.93 per barrel. Gold was climbing 0.74% to $1676.3 an ounce and silver was rallying 3.14% to $32.67 an ounce. Meanwhile, copper was gaining 1.24%.

Today’s Stocks to watch: American Eagle Outfitters (NYSE: AEO), Apache (NYSE: APA), Apple (NASDAQ: AAPL), Bank of America (NYSE: BAC), CSX Corp (NYSE: CSX), Halliburton (NYSE: HAL), Research In Motion (NASDAQ: RIMM), and Texas Instruments (NYSE: TXN).

American Eagle Outfitters (NYSE: AEO), the specialty retailer of casual apparel and outerwear for men and women, will be a stock to watch after the company in an 8-K disclosed that its CEO James V. O’Donnell will resign to its CEO and board of directors roles on January 28^th.

Apache (NYSE: APA), the natural gas and oil driller, will be in focus in the session after the company announced that it will acquire privately owned oil and gas company Cordillera Energy Partners for $2.85 billion. Cordillera has proven reserves of 71.5 million barrels of oil equivalent and current net production of 18,000 barrels of oil equivalent per day. Apache said the acquisition is expected to add to its earnings and cash flow from 2012.  

Apple (NASDAQ: AAPL), the maker of iPads and iPhones, was climbing 0.64% to $423 in pre-market. The stock last week fell 0.5% after it pullback from a new all-time high of $431.37, which came amid the company announcing its iBooks 2 and after FBR Capital initiated coverage on Apple with Outperform and a target price of $500 and as RBC Capital bumped its target price to $525 from $500, citing their expectations of a first quarter beat and healthy guidance for the second quarter. The firm expects the tech giant to have shipped 32 million iPhones during the Holiday quarter. Apple is schedule to reports its quarterly results tomorrow after the close, with analysts on average expecting a profit of $10.03 on revenues of $38.78 billion. The highest estimate is for Apple to earn $11.45 per share.

Bank of America (NYSE: BAC) was gaining 1.13% to $7.15 in pre-market amid upside moves in financial shares in Europe on a report that cited France and Germany calling for relaxing global capital rules to avoid choking off lending. Last week, the company posted a decent earnings report, with inline EPS and revenues above consensus. Bank of America is so far the best Dow component for the year, with shares surging 27.2%. It has calculated resistance at $7.29.

CSX Corp (NYSE: CSX), the provider of rail, intermodal and domestic container shipping, will be in focus as participants adjust positions ahead of its quarterly results due out after the close. On average analysts expect a profit of $0.44 per share on revenues of $2.99 billion. Last quarter, the company posted inline EPS of $0.43.

Halliburton (NYSE: HAL), the provider of oilfield technologies and services to upstream oil and gas customers, was climbing 0.83% to $33.50 in pre-market on initial reaction to its quarterly results that beat earnings expectations. Halliburton said it earned $1 per share, excluding a $0.02 environmental related charge, $0.01 better than consensus. Revenues jumped 36.9% year over year to $7.06 billion versus consensus of $6.81 billion. The company had strong results through out the year in North America, with each quarter setting a new revenue record. Its Latin American business also had a strong quarter in which revenue jumped 9% and operating income surge 24% sequentially.

Research In Motion (NASDAQ: RIMM), the maker of the Blackberry smartphone, was rallying 3.41% to $17.58 in pre-market on news that its co founders Jim Balsillie and Mike Lazaridis stepped down from their co CEO positions amid increased investor pressure for reforms and changes in strategy, as the Canadian company continues to struggle and lose market share to Apple’s iPhone and Google’s Android. RIM named Thorsten Heins as President and CEO, promoting him from its co COO position. Deutsche Bank added to the upside momentum, as it upgraded the stock to a Hold from a Sell. Year to date, the stock has jumped more than 17% on speculation over M&A or that the company will sale 1 or 2 of its units to unlock value.

Texas Instruments (NYSE: TXN), the maker of digital signal processing (DSP) and microcontroller (MCU) semiconductors, will be in focus, as participants adjust positions ahead of its quarterly results due out after the closing bell. On average analysts expect a profit of $0.39 per share on revenues of $3.25 billion. Last quarter, the company posted a 7% upside earnings surprise, as it earned $0.61 per share. Last week, Needham downgraded the stock to a Hold from Buy, saying it does not expect much upside in its fourth quarter results and that it expects that the inline flat results will prompt investors to sell on the news.