Mid-Morning Look: January 18, 2024

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Mid-Morning Look

Thursday, January 18, 2024





DJ Industrials




S&P 500








Russell 2000






U.S. stocks jump led by gains in, you guessed it, Technology (XLK), rising 1.4% behind an upgrade in AAPL (lifting shares 2%) and a better earnings report/guidance/commentary from TSM in the semiconductor space (shares +8%) as the big cap tech names again doing the heavy lifting for the S&P and Nasdaq. Smallcaps underperform again with the Russell 2000 up the least. Treasury yields edge higher, adding to yesterday’s gains with the 10-yr topping 4.12%. Economic data in the U.S. mostly positive as weekly jobless claims posts lowest print since January of last year and housing starts better-than-expected, but Phill Fed Business index posts a negative reading for the 12th time in last 13. In Earnings news, Healthcare industry pressured after HUM lowers guidance, sinking HMO names. Consumer finance stocks soft behind a big profit decline in DFS sending shares lower. A handful of regional bank earnings push financials lower. AA a bright spot in materials following earnings results. More Fed commentary – and seems less and less dovish: Fed’s Bostic said, “if inflation progress slows, it’s good to keep higher longer”. Also, WSJ’s Nick Timiraos tweets: "Was it all "just supply" that caused inflation? Fed Governor Chris Waller is not having it. "If these are temporary supply shocks, when they unwind, the price level should go back to where it was. It’s not. Go to Fred. Pull up CPI. Look at that thing." So yet again, Fed speakers are sounding less and less dovish, and rate cut expectations have already eased to about 5 cuts this year from 6 to start the year (including a drop to 50% chance of a cut in March) – yet stocks remain strong and near all-time highs for large cap giants.

Economic Data

  • Weekly Jobless Claims were 187K in latest week vs. est. 208K and lowest since January 2023; the 4-week moving avg fell to 203,250 from 208,000 prior week; the insured unemployment rate unchanged at 1.2%; continued claims fell to 1.806M Jan 6 week (vs. est. 1.845M) and 1.832M prior week.
  • Housing starts for December little better -4.3% at 1.46M unit rate vs est. 1.426M and Nov +10.8% (1.525M units); Dec single-family starts -8.6% to 1.027M unit rate; multifamily +8.0% to 433,000-unit rate. Housing permits +1.9% to 1.495M unit rate vs. est. 1.48M and vs Nov -2.1%.
  • The Philadelphia Fed factory index for January with a negative -10.6 reading vs. estimate -7.0 (now 12 of last 13 readings have been negative).






WTI Crude















10-Year Note




Sector Movers Today

  • Managed care stocks fall after HUM forecasts FY adj EPS $26.09, had forecast at least $28.25 and was below est. $28.27; saying they were unable to offset higher than anticipated medical costs; said membership growth outlook for 2024 is impacted by balanced approach to pricing which resulted in a lower share of overall industry growth. HUM Q4 medical benefit ratio is now expected to be about 91.4% in the insurance segment vs previous expectation of 89.5%. Shares of other HMOs UNH, CVS, CI, ELV, MOH declined in sympathy).
  • Regional Bank earnings active: FHN Q4 EPS $0.31 vs. est. $0.30; Q4 ROTCE of 10.9% and adjusted ROTCE of 11.1% with tangible book value per share of $12.13, up 8% q/q.; KEY Q4 EPS $0.03 vs. est. $0.23 and revs $1.54B vs. est. $1.53B; MTB Q4 net income fell 37% to $482M, or $2.74 vs. est. $3.10; NTRS Q4 net interest income (NII) declined almost 10% to $483.1M from $534.5M y/y; Revenue climbed to $1.55B from $1.52B but below ests $1.71B; SNV Q4 EPS of $80 misses the $090 estimate; TFC Q4 adj EPS $0.81 vs. est. $0.89; Q4 revs $5.76B vs. est. $5.69B; Q4 tangible book value per share $21.83; WTFC Q4 adjusted EPS of $1.87 was shy $2.49 est. on lighter revs $570.8M.
  • Luxury retail: After weak results/guidance last week from Burberry, Richemont (CFRUY) shares rose after saying its sales rose to 5.59 billion euros ($6.09 billion) in the quarter, ahead of market expectations as the luxury retailer enjoyed a surge in sales in China in its latest quarter; Richemont’s sales increased by 8% in three months Dec. 31, better than the 5% rise in the previous three months. (shares of TPR, RL, PVH moved in reaction).



  • AAPL +2%; upgraded to Buy from Neutral at Bank America with a price target of $225, up from $208 as the firm sees a stronger multi-year iPhone upgrade cycle driven by the need for the latest hardware to enable generative artificial intelligence features to be introduced in 2024 and 2025.
  • BTU +8%; set to join S&P SmallCap 600 index, replacing ELF effective Jan. 23; ELF to replace SRC to join S&P MidCap 400 index from Jan. 23.
  • DKNG +4%; after UK’s Flutter Entertainment (PDYPF), home to the Paddy Power, Betfair and Sportsbet brands, posts Q4 revenue jump of 15% but said growth at its U.S. FanDuel unit was below its expectations.
  • MDC +18%; announced an agreement to be bought by Japan-based Sekisui House Ltd. in a deal valued at $4.9 billion as shareholders will receive $63 in cash for each M.D.C. share they own. http://tinyurl.com/557rah5s
  • NVCR +11%; said the FDA has accepted its application for premarket approval for its device Tumor Treating Fields, for a type of lung cancer, in combination with either chemotherapy or cancer immunotherapy.
  • PINS +2%; upgraded from Hold to Buy at Argus with $45 PT saying Pinterest users see the site as a place to shop, with more than half of them intending to purchase prior to visiting the company’s platform and the firm expects more of these users, higher engagement, increased ad prices and higher ad loads to drive growth.
  • RAMP +8%; announced the acquisition of Habu, a data clean room software provider, and announced preliminary fiscal Q3 revenue and non-GAAP operating income that came in above guidance.
  • TSM +7%; after Q4 results and guided higher than views for the year ahead; said it sees more than 20% growth in 2024 revenue on booming demand for high-end chips used in artificial intelligence applications.



  • BIRK -6%; as Q4 adj EPS of 0.14 euros misses estimates of 0.17 euros; expects a hit to fiscal 2024 adjusted EBITDA margin from steeper costs related to investment in global store expansion; forecasts FY24 revenue above expectations, and Q4 revs rise to 374.54M euros from 321.61M y/y and surpassing estimates of 357.39M euros.
  • DFS -7%; after Q4 profit fell -62% to $388M as EPS of $1.54 missed est. $2.50 on NII $3.468B vs est. $3.381B, credit loss provision $1.909B vs. $933M y/y; sees 2024 NIM 10.5-10.8% depending on rates, sees 2024 loans relatively flat, sees 2024 avg net charge-off rate 4.9-5.3% (shares of COF fell in reaction).
  • EHTH -20%; downgraded to Hold from Buy at Craig Hallum and cut tgt cut to $7 from $11 saying checks suggested that this year’s AEP enrollment growth was below plan for the industry.
  • FSM -10%; said silver production fell 19% to 1.35 million ounces in the period due largely to declining grade profile of its mineral reserves in the mine plan.
  • HUM -14%; forecasts FY adj EPS $26.09, had forecast at least $28.25 and was below est. $28.27; saying they were unable to offset higher than anticipated medical costs (weighs on shares of UNH, ELV, CI).
  • PLUG -14%; announced via 8k the filing of a new ATM offering of up to $1B in common stock with use of proceeds for general corporate purposes.
  • SAVE -9%; shares fall for a 5th day and extends losses after M&A deal fell thru this week with JBLU; Citigroup downgraded to Sell saying although JetBlue and Spirit can still appeal Tuesday’s court ruling, which blocked the carriers’ proposed merger, it is unclear why JetBlue wouldn’t cut its losses here.


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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