The last third quarter report for the week (still 9 companies left to report for the season) came from Deere (DE) this morning. The company blew past expectations on both the top and bottom-line, with EPS of $1.83 beating the Estimize consensus by $0.16 and the Wall Street consensus by $0.25. Revenues came in at $8.04B, well above the Estimize expectation for $7.83B and the Street's estimate of $7.79B. Despite the third quarter beat, Deere forecast a decrease in equipment sales for the fourth quarter as lower grain prices has translated to weaker demand for tractors and agricultural machinery. The outlook sent shares down 3.5% at the open.

Additionally, there was some discouraging economic data this morning. The headline number for October Durable Goods Orders was much stronger than expected, reporting MoM growth of 0.4%, above the Estimize expectation for a 0.4% decrease. However, the core number which excludes transportation, fell 0.9% from September. While defense aircraft jumped 45.3%, non-defense aircraft orders were down 0.1%. The outlook for equipment investment also continued to moderate. Non-defense capital goods orders excluding aircraft declined 1.3%, while shipments were down 0.4%, missing the Estimize consensus for a MoM increase of 0.06%.

Initial Jobless Claims were also disappointing, reporting a weekly increase of 313,000, up 7.2% from last week, and much higher than our expectation of 286,652. This is the highest figure seen since the September 6 report showed 316,000 initial claims. This morning's release breaks the streak of 10 consecutive weeks of claims below 300,000.

How Are We Doing?

Expectations for S&P 500 earnings growth for the third quarter stand at 11.6%. Revenues are anticipated to come in with 4.8% growth. All 10 sectors are anticipated to post positive YoY growth on both the earnings and revenue front.

Leaders

Earnings:

Energy (14.3%). Notable industry: Oil, Gas and Consumable Fuels (14.8%)