Mid-Morning Look: June 03, 2024

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Mid-Morning Look

Monday, June 03, 2024





DJ Industrials




S&P 500








Russell 2000






U.S. stocks are mixed after posting broad based declines last week, led by a rebound in Healthcare, Communications, and Technology while Energy tumbles around 2% on oil weakness, and Industrials, Materials and Financials pressured. Treasury yields and the US dollar tumbled following economic data at 10:00 AM as the ISM report showed weakness as well as softer construction spending (10yr yield hit lows below 4.41%). Early strength in risk assets in general, with technology leading market gains after underperforming on Friday behind strength in semiconductors (SOX), while Bitcoin jumps over 3% back above $70,000 and major averages moving higher. “Meme” stock madness back with shares of GME jumping and helping bounce some stocks that have high short interest/spec stocks. Semiconductors NVDA, AMD, ARM jumping after headlines this weekend at Computex technology trade show in Taipei. Oil prices are sliding following OPEC+ headlines this weekend, with WTI crude heading towards $75 per barrel, its lowest level since early February. There were some computer glitches on the NYSE saying they continue to investigate technical issues on limit up/limit down (LULD) bands (effecting several companies this morning with notable names BRK/A, CMG, SMR). No major earnings today (or for week) and no Fed speakers ahead of FOMC meeting next week, meaning the key focus this week will be jobs data (tomorrow, Wednesday and Friday).

Economic Data

  • S&P Global May final manufacturing PMI at 51.3 (vs flash 50.9).
  • ISM U.S. manufacturing activity index declined to 48.7 in May from 49.2 in April and below consensus 49.6, raising hopes of Fed rate cuts; the prices paid index 57.0 in May (consensus 58.5) vs 60.9 in April; new orders index 45.4 in May vs 49.1 in April and the employment index 51.1 in May vs 48.6 in April.
  • April construction spending fell -0.1% below consensus +0.2% and vs March -0.2%; U.S. April private construction spending -0.1%, public spending -0.2%.






WTI Crude















10-Year Note




Sector Movers Today

  • In Semiconductors: AMD unveiled its latest artificial intelligence processors on Monday at the Computex technology trade show in Taipei and detailed its plan to develop AI chips over the next two years; AMD CEO Lisa Su introduced the MI325X accelerator, which is set to be made available in the fourth quarter of 2024. ARM expects 100B Arm devices worldwide will be ready for artificial intelligence by the end of next year, the company’s chief executive, Rene Haas, said on Monday at the Computex forum in Taipei. LSCC said COHR hired Jim Anderson as the laser maker’s new CEO, poaching the executive from Lattice Semiconductor. Lattice said Esam Elashmawi, its chief marketing and strategy officer, will step in as interim CEO. NVDA said this weekend at the Computex technology trade show in Taipei that the company’s next-generation artificial intelligence (AI) chip platform was called Rubin and would be rolled out in 2026; new CPU will be called Versa and the new graphics chips that are used to power AI applications will bundle next generation high-bandwidth memory.
  • In Life Sciences/Tools: Jefferies made several changes, downgrading shares of Agilent (A), BIO, and NAUT to Hold and downgraded MTD, MYGN to Underperform, while launch coverage of other life science tools and diagnostics and assumed coverage in others. On Tools, the firm says is moving past COVID/de-stock overhang, continues to believe durable growth stories w/ operating leverage, healthy FCF & B/S optionality should be rewarded; for growth Tools: host of headwinds, await more visibility. And for DX, upbeat on secular growth drivers, prefer those w/ strong commercial engines (EXAS, NTRA). Initiations: ILMN (Hold, $115), NTRA (Buy, $142), PACB (Buy, $4), TXG (Hold, 24), GH (Buy, $32) and transfers ratings unchanged for RGEN (Hold, $165), MRVI (Buy, $11).
  • In Chemicals: WDFC mentioned positively in Barron’s noting the shares took a hit in April after reporting sales that were slightly lower than expectations in Q2. While shares trade at a pricey 40 times 12-month forward earnings, they may be worth buying because of the company’s consistent earnings and sales growth, Barron’s. Deutsche Bank said TROX, KRO both look well positioned to benefit from recent industry outages and any potential Q3 price increase as both the companies’ North American TiO2 manufacturing facilities are operating normally. The firm noted Friday announcement from CC that it was pausing production at its Altamira, Mexico TiO2 plant due to a severe regional drought.
  • Chinese Electric Vehicles: monthly May delivery data showed: LI may total vehicle sales rose 23.8% y/y to 35,020 units: Jan-May total vehicle sales 774,571 units; NIO said May total vehicle sales 20,544 units; up 233.8% on year and for Jan-May total vehicle sales 66,217 units; up 51.0% on year; XPEV delivered 10,146 vehicles in May, up 35% y/y as May deliveries rose 8% in month; Jan-May deliveries 41,360 vehicles, up 26% on year; 9 deliveries 1,625 units in May.



  • ADSK +7%; shares jump as announced the results of the audit committee investigation; no restatement of financials was required, though it was noted that FY/23 multi-year upfront billings were above historical levels and prelim Q1 and Q2’25 guidance was ahead while CFO Debbie Clifford will move to Chief Strategy Officer.
  • AGIO +14%; said its drug mitapivat reduced the need for blood transfusions in patients with a severe form of beta-thalassemia, an inherited blood disorder; results achieved the primary goal of a placebo-controlled Phase 3 clinical trial.
  • EW +2%; shares advanced after entering into a definitive agreement to sell its Critical Care product group to BDX, in an all-cash transaction valued at $4.2B.
  • GME +26%; after Keith Gill’s Reddit account (also known as “Roaring Kitty”, that drove the 2021 meme-stock mania, posted what seemed to be a $116 million position in the stock.
  • HZO +21%; after Bloomberg News reported that ONEW is in talks to acquire the company, citing people with knowledge of the matter. OneWater has made an all-cash, $40-a-share offer for MarineMax following months of private discussions, the people said https://tinyurl.com/mr73put5  
  • PARA +7%; after the WSJ reported a sweetened offer by David Ellison’s Skydance Media to buy family company National Amusements and merge with Paramount, at roughly $15 each while also giving shareholders the option to roll into the new deal, The WSJ reported. https://tinyurl.com/3uhwss4b
  • SPOT +4%; said it is increasing the cost of its premium subscription plans to $11.99 per month so then can “continue to invest in and innovate on our product features”.
  • SRCL +15%; as WM confirmed weekend M&A reports in the WSJ that it will acquire medical waste disposal company SRCL in a deal valued at $7.2 billion, the companies said as the deal is expected to close by Q4. Bloomberg reported last month that Stericycle was exploring a potential sale after receiving takeover interest. https://tinyurl.com/yunk2k84



  • CRBU -22%; shares tumbled after presented updated data from an ongoing early-stage trial studying its off-the-shelf CAR-T cell therapy CB-010; reported 5 deaths of which 1 death was possibly related to CB-010 due to bladder rupture.
  • DELL -5%; adds to last Friday’s -17% decline– had posted Q1 adj operating income $1.474B missed est. $1.485B and said the company expects gross margin rate to decline about 150 basis points with mixed EPS/rev guidance.
  • GSK -8%; and SNY shares declined after news they must face trials in state court in Delaware after a judge found evidence backing up claims the companies’ former Zantac heartburn treatment causes cancer is legitimate and can be heard by juries.
  • LSCC -14%; after COHR hired Jim Anderson as the laser maker’s new CEO, poaching the executive from Lattice Semiconductor. Lattice said Esam Elashmawi, its chief marketing and strategy officer, will step in as interim CEO.
  • SAM -3%; shares dropped after Japanese whisky-maker Suntory Holdings said this weekend (6/1) that it was not in negotiations to acquire Boston Beer, refuting a report late Friday that there were deal talks between the two companies. SAM shares surged 26% on Friday on news of deal talks https://tinyurl.com/5m6bpbpr
  • TM -2%; said temporarily halted shipments and sales of three car models made in Japan; Japan’s transport ministry found irregularities in applications to certify the models.


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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