Mid-Morning Look: April 26, 2021

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Mid-Morning Look

Monday, April 26, 2021






DJ Industrials




S&P 500








Russell 2000






U.S. stocks looking to recover after sliding (slightly) last week, with a busy week of earnings (over 30% of the S&P 500 expected to report this week including results from AAPL, AMZN, FB, TSLA, MSFT this week, while markets also get an FOMC meeting mid-week with focus on interest rates, inflation, and tapering comments. Commodity prices are mixed as copper prices hit their highest in 10 years, while Soybeans, Wheat and Corn traded near their highest in eight years. Oil prices slide while gold prices are little changed as the U.S. dollar rebounds. Durables Orders rose +0.5% vs. est. 2.3% and February revised to -0.9% from -1.2%; Durables ex-defense orders +0.5% from Feb -0.4%; March nondefense cap orders ex-aircraft +0.9% vs. February down -0.8%. There were also a handful of M&A deals with PFPT acquired in the internet security sector, GRA acquired in the chemicals sector and a deal in the banking sector.







WTI Crude















10-Year Note





Sector Movers Today

·     Pharma movers; SNY has agreed to make MRNA’s Covid-19 vaccine at its site in Ridgefield, New Jersey, and will fill and finish up to 200 million doses starting in September; JNJ shares rose after the bell Friday after the FDA announced that following a safety review, the agency and the CDC have determined that the recommended pause regarding the use of its Covid-19 vaccine in the U.S. should be lifted and use of the vaccine should resume; VYGR rises after the company said the U.S. FDA has removed the clinical hold on the Investigational New Drug (IND) application for VY-HTT01, a gene therapy candidate for the treatment of Huntington’s disease; PRGO mentioned favorably in Barron’s saying the Dublin-based drug company, with a $5.6B market cap, could rise 20% or more as it returns to a pure-play consumer-health company and puts behind its tax issues

·     Consumer Staples; supermarket ACI reports beat on earnings and sales for Q4 while saying expects identical sales in FY22 of -6% to -7.5% and adjusted EBITDA of $3.5B-$3.6B vs. $3.45B consensus and raises EPS view for FY to $1.95-$2.05 vs. $1.71 consensus; NSRGY is in discussions to buy nutritional supplement maker The Bountiful Company, confirming recent media reports; Barron’s is positive on the packaged foods space (HSY, MDLZ, CAG, SJM, TWNK, KHC, GIS, K, and CPB) citing cheap valuations, generous dividend yields, and better growth prospects than meets the eye; SAM was downgraded to neutral at Citigroup after rally in shares; Jessica Alba’s lifestyles brand The Honest Company Inc. (HNST) released specifics Monday for its upcoming IPO, with the firm and certain investors offering 25.8M to the public at $14 to $17 apiece.

·     Metals & Materials; copper prices hit their highest in 10 years, while Soybeans, Wheat and Corn traded near their highest in eight years as the post-pandemic tide of liquidity continued to lift practically every boat in sight; CLF was downgrade downgraded to Sector Weight from overweight on valuation at KeyBanc; in lumber, paper sector, Raymond James upgraded WY to strong buy with $50 tgt, and named PCH new favorite idea with $79 tgt saying with lumber prices and futures hitting new highs once unimaginable a year ago, they are proactively raising forward earnings estimates for our lumber-exposed Timber REITs, PotlatchDeltic and Weyerhaeuser, ahead of expected 1Q results later this week.

·     REITs; Evercore upgraded SPG to Outperform with a $128 target on limited downside risk with low tenant fallout as occupancy rate reaching a trough by the end of 1H21 and shopping center/mall REITs shifting to recovery and growth; Credit Suisse raised their price target on EPRT to $27 from $24 ahead of earnings to reflect stronger portfolio/revenue growth outlook, and also raised their estimates and targets on single-family REITs AMH (to $36 from $32) and INVH (to $36 from $33) ahead of earnings; Cowen sees solid data center demand driven by hyperscalers and favors COR, GDS, QTS in the space; In the industrial space, BTIG initiated INDT at Buy with a $74 target due to its high-quality legacy portfolio and investment strategy geared towards the Southeast and Mid-Atlantic, and ILPT at Neutral as they see limited near-term value creation opportunities in its portfolio despite their overall positive industrial outlook; in commercial real estate, JPM named KREF as its top pick into earnings and downgraded BXMT to Neutral given its lack of near-term catalysts to re-rate beyond pre-Covid valuation



·     AXSM +13%; as the FDA granted priority review to AXS-05 for the treatment of major depressive disorder as its NDA is supported by a pair of studies that showed statistically significant improvements in depressive symptoms with AXS-05 compared to placebo and active controls

·     CSPR +25%; upgraded to Outperform at Wedbush saying with an attractive relative valuation and a clear and balanced path forward between revenue growth and profitability, see an opportunity (also positive mention on twitter)

·     FBC +5%; as NYCB agreed to buy FBC in a stock deal valued at $2.6 billion as FBC shareholders will receive 4.0151 New York Community shares for each Flagstar share they own, values FBC at $48.14 each https://on.mktw.net/3eAnZlw

·     FCX +6%; as copper prices hit 10-year highs amid another spike in commodity prices

·     GRA +6%; to be acquired by privately held Standard Industries Holdings Inc. in a deal valued at $7.0B, with W.R. Grace holders to receive $70 in cash per share https://on.mktw.net/3xpXuIk

·     GSX +12%; as the company files w/ the SEC its annual report on Form 20-F for the fiscal year ended December 31, 2020

·     OTIS +7%; as Q1 adj EPS 72c vs. est. 63c; Q1 revenue $3.41B vs. est. $3.18B and also raises year profit and revenue outlook

·     PFPT 31%; entered into a definitive agreement to be acquired by PE firm Thoma Bravo for $176 per share in cash, a 34% premium to Friday’s closing price in a transaction that values Proofpoint at approximately $12.3B https://bit.ly/3sTs2yw

·     QURE +9%; said the FDA has removed clinical hold on its gene therapy program for a type of blood disorder called hemophilia B (the agency had placed the program on clinical hold in December after a patient in a late-stage trial was diagnosed with a type of liver cancer)

·     VYGR +14%; after the company said the U.S. FDA has removed the clinical hold on the Investigational New Drug (IND) application for VY-HTT01, a gene therapy candidate for the treatment of Huntington’s disease



·     ACI -5%; warned that it expects to face difficult comparisons in its new fiscal year, as many people look to reemerge from the Covid-19 pandemic and said it believes comparable sales for its new year will decline 6% to 7.5% on a year-over-year basis.

·     BBY -2%; downgraded to Neutral at Wedbush after run-up in shares, while raising near-term estimates above consensus based on consumer electronics category strength

·     ETSY -3%; downgraded from Overweight to Sector Weight at Keybanc saying think it remains one of the best long-term growth stories under coverage but is up 876% since their Overweight vs. 101% NASDAQ

·     KR -3%; declines in sympathy with ACI and other food related stocks

·     ROKU -1%; says it may lose YouTube TV app after Google made anti-competitive demands, according to a report by Axios https://bit.ly/3aFh4X7


Market commentary provided by Hammerstone Markets, Inc, a firm separate from and not affiliated with Regal Securities. Regal Securities has not participated in the creation of the content, and does not explicitly or implicitly endorse the content.

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