Global Economic Slowdown: Market Happenings for Thursday, July 12, 2012

Premarket, futures are down on fears of a global economic slowdown. Gainers this morning include MRK, EA, CAH, ORCL and BA while losers include FITB, WPX, HCBK, SWY and CTSH.

The Market

Shares of Merck (MRK) are up more than 3% in premarket trading, after the pharmaceutical giant’s osteoporosis drug Odanacatib showed positive results in the lab. The results caused outside observers to suggest that the company stop the study early.

The euro fell below $1.22 to a new two-year low against the dollar. The selling has spilled over to commodities, with oil prices sliding more than 1%.

European stocks were lower in morning trading and Asian markets ended mixed.

Levi Asia sales lower in June.

The Labor Department reported 350,000 people filed for first-time unemployment benefits during the week ended July 7, beating expectations and reaching a four-year low. The latest numbers show a decrease of 26,000 from the previous week’s 376,000.

Import prices excluding fuels fell by 0.3% in June, according to the Bureau of Labor Statistics. Prices have continued to fall most of the year so far.

The national average price of gasoline was up one-tenth of a cent to $3.384 per gallon.

Earnings Reports

Earnings reports: PGR-Progressive Corp (Consensus $0.27), FAST-Fastenal (0.37%), CBSH-Commerce Bankshares (0.72%).

Financial Calendar

0830 ET Weekly initial unemployment claims expected -4,000 to 370,000, previous -14,000 to 374,000. Weekly continuing claims expected -6,000 to 3.300 mln, previous +4,000 to 3.306 mln.

0830 ET June import price index expected -1.8% m/m and -1.5% y/y, May -1.0% m/m and -0.3% y/y.

0830 ET USDA weekly exports.

1030 ET DOE natural gas storage.

1300 ET Treasury auctions $13 billion in 30-year bonds.

1400 ET June U.S. budget statement expected -$64.5 bln.

1540 ET Fed’s Williams speaks in Portland, Oregon.

1630 ET Weekly money supply report and Fed balance sheet.

n/a Treasury announces 10-year TIPS auction for July 19.

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