Early Look
Thursday, July 27, 2023
|
Futures |
Up/Down |
% |
Last |
|
Dow |
35.00 |
0.10% |
35,719 |
|
S&P 500 |
27.25 |
0.60% |
4,623 |
|
Nasdaq |
195.50 |
1.25% |
15,806 |
U.S. stocks are being bid higher to start the day following strong quarterly results in the tech/communications space overnight as META shares look higher by 8% and chip stocks gain behind a strong forecast from LRCX. The Federal Reserve raised interest rates by a quarter of a percentage point on Wednesday to 5.35%-5.5% and Fed Chair Jerome Powell said the economy still needed to slow and the labor market to weaken for inflation to “credibly” return to the U.S. central bank’s 2% target. The move by the Fed marked the 11th hike in the U.S. central bank’s past 12 policy meetings but surprised no one and scare no one. Powell made no promises either way, with a September meeting eight weeks from now considered “live” for another rate increase, though remains data dependent. Speaking of, busy day of data with Q2 GDP, Core PCE index inflation data, weekly jobless claims, Trade balance, Durable Goods and Pending Home Sales all expected this morning. Also, the European Central Bank (ECB) is expected to raise interest rates for the ninth time in a row later this morning and keep the door open to further moves as persistent inflation and growing evidence of an economic downturn pull policymakers in opposing directions. The Dow Jones Industrial Average, which ended at its highest level since February 9, 2022, rose for a 13th-straight day. The DJI last rose 13 days in a row in January 1987. Refinitiv data going back to January 1920 shows no winning streak of more than 13-straight days for the Dow. In Asian markets, The Nikkei Index jumped 222 points to 32,891, the Shanghai Index fell -6 points to 3,216, and the Hang Seng Index jumped 273 points to 19.639. In Europe, the German DAX is up 145 points to 16,277, while the FTSE 100 is up 15 points to 7,692.
Market Closing Prices Yesterday
· The S&P 500 Index dipped -0.71 points, or 0.02%, to 4,566.75.
· The Dow Jones Industrial Average rose 82.05 points, or 0.23%, to 35,520.12.
· The Nasdaq Composite slipped -17.27 points, or 0.12%, to 14,127.28.
· The Russell 2000 Index advanced 14.24 points, or 0.72% to 1,980.36.
Earnings Calendar:
· Earnings Before the Open: ABBV AGCO AMAL AMT AOS ARCH AVNT BAX BC BMY BSX BTU CARR CBRE CBZ CFR CMCSA CNP CNX CROX CRS CWT DTE EME EXLS EXP FAF FCFS GVA GWW HCA HOG HON HSY HTZ IART IP ITGR KDP KBR KEX KIM KRNY LAZ LECO LH LII LIND LKQ LUV MA MAS MCD MDC MLM NEOG NOC NSC NTCT NYCB OIS OPCH OSTK PATK PCG PRCT PRFT RCL RS SAH SPGI STRA TREE TSCO TW TXT ULBI VLO VLY WAB WEX WST XEL XPRO
· Earnings After the Close: AB ACHC AEP AIRC AJG ALEX ALSN APPF ATR AX AXNX BJRI BYD BZH CC CINF COUR CTO CUBI CUZ CWST DECK DLR DXCM EIX EMN ENPH EQR ESS F FBIN FSLR GLPI GSIT HIG HLI HURN INTC JAKK JNPR KLAC LPLA LYV MATW MDLZ MHK MTD MTH NATI OLN OVV PEAK PEB PFG PFSI PMT ROKU RWT SG SAM SKX SKYW SLCA SNBR SPSC SSB SSNC TBKK TMUS TXRJ UCTT ULH VRSN WY X
Economic Calendar for Today
· 8:30 AM ET Gross Domestic Product (GDP) for Q2…est. +1.8%
· 8:30 AM ET GDP Price Deflator…est. +3.0%
· 8:30 AM ET Personal Spending for Q2
· 8:30 AM ET PCE Prices for Q2
· 8:30 AM ET Core PCE Prices advance for Q2…est. +4.0%
· 8:30 AM ET Weekly Jobless Claims…est. 235K
· 8:30 AM ET Continuing Claims…est. 1.75M
· 8:30 AM ET Advance Goods Trade Balance
· 8:30 AM ET Durable Goods Orders M/M for June…est. +1.0%
· 8:30 AM ET Durable Goods Ex: Transportation M/M for June…est. 0.0%
· 10:00 AM ET Pending Home Sales M/M for June…est. (-0.5%)
· 10:30 AM ET Weekly EIA Natural Gas Inventory Data
· 11:00 AM ET Kansas City Fed Manufacturing for July
· 1:00 PM ET US Treasury to sell $35B in 7-year notes.
|
Macro |
Up/Down |
Last |
|
Nymex |
0.67 |
79.45 |
|
Brent |
0.51 |
83.43 |
|
Gold |
6.70 |
1,976.80 |
|
EUR/USD |
0.0064 |
1.1146 |
|
JPY/USD |
-0.15 |
140.06 |
|
10-Year Note |
+0.014 |
3.865% |
World News
· The bull-bear spread in the American Association of Individual Investors (AAII) weekly survey was 20.8 vs 29.9 last week. Bulls fall to 44.9% from 51.4%, Neutrals rise to 31% from 27.1%, Bears rise to 24.1% from 21.5%.
Sector News Breakdown
Consumer
· Mattel (MAT) Q2 adj EPS $0.10 vs. rest. Loss (-$0.02); Q2 revs $1.09B vs. est. $1B; reiterates FY23 adj EPS view $1.10-$1.20 vs. est. $1.16 and sales and adjusted EBITDA view $900M-$950M.
· O’Reilly Automotive (ORLY) Q2 EPS $10.22 vs. est. $10.09; Q2 revs $4.07B vs. est. $3.99B; Q2 comparable sales up 9% vs. est. +7.1%; said CEO Greg Johnson to retire, Brad Beckham to succeed; raises FY EPS $37.05-$37.55, from prior $36.50-$37 and also raises year revs view to $15.4B-$15.7B and comp sales to up 5%-7% from 4%-6% prior.
Energy
· Antero Resources (AR) Q2 EPS loss (-$0.28), in line with consensus on revs $953.3M vs. est. $932.41M; Q2 net production averaged 3.4 Bcfe/d; Q2 liquids production averaged 192 MBbl/d, an increase of 16% from the year ago period; increasing full year 2023 production guidance by 100 mmcfe/d, or 3%, to a range of 3.35 to 3.4 bcfe/d.
· American Water (AWK) Q2 EPS $1.44 vs est. $1.31 on revs $1.097B vs est. $1.011B; affirms FY EPS guide $4.72-4.82 vs est. $4.78; affirms long-term targets.
· Helmerich & Payne (HP) Q3 EPS $0.93 vs. est. $0.91; Q3 revs $724M vs. est. $708.24M; Quarterly North America Solutions’ operating income decreased $13M sequentially, while direct margins decreased $19M to approximately $277M, as revenues decreased by $34M.
· Sunnova Energy (NOVA) Q2 EPS loss (-$0.74) and revs rose 13% y/y to $166.4M vs. est. $192.7M; said sees new customers 135K-145K from prior view 125K-135K; Q2 adj EBITDA $28.1M, -29% y/y, vs. est. $43.4M.
Financials
· Ameriprise (AMP) Q2 adj EPS $7.44 vs. est. $7.38; Q2 revs $3.88B vs. est. $3.81B; announces additional $3.5B share repurchase authorization.
· Arch Capital Group (ACGL) Q2 EPS $1.92 vs. est. $1.59; Q2 Book value per share $37.04 vs. $31.37 y/y, and combined ratio 79.8%; Q2 combined ratio before catastrophe losses 79.7%, and net premiums written $3.43B, +28% y/y.
· Lending Club (LC) Q2 adj EPS $0.09 vs. rest. $0.04; Q2 revs $232.5M vs. est. $227.37M; Q2 book value per common share of $11.09, up from $11.08 in the prior quarter, and tangible book value per common share of $10.26, up from $10.23 q/q; sees Q3 loan originations $1.4B-$1.7B.
· Mid-America Apartment (MAA) Q2 core FFO/shr $2.28 vs est. $2.26; same-store portfolio revs +8.1% with average effective rent per unit +9.3% and average physical occupancy 95.5%; guides FY core AFFO/shr $8.09-8.36 vs prior $8.01-8.37 and same-store portfolio revs +5.5-7.0% vs prior +5.25-7.25%.
· Western Union (WU) Q2 adj EPS $0.51 vs. est. $0.39; Q2 revs $1.17B vs. est. $1.05B; raises FY23 adjusted EPS view to $1.65-$1.75 from $1.55-$1.65 (est. $1.62) and boosts FY23 revenue growth view to (5%)-(3%) from (9%)-(7%).
Healthcare
· Align Technologies (ALGN) Q2 EPS $2.22 vs est. $2.03 on revs $1.0B vs est. $991.4Mm; adj op mgn 21.3%; guides Q3 revs $990Mm to $1.01B vs est. $990.3Mm, adj op mgn up slightly sequentially; sees FY revs $3.97-3.99B vs est. $3.941B and adj op mgn slightly above 21%.
· Bio-Rad Laboratories (BIO) and Qiagen (QGEN) announced that the companies have agreed to settle their patent dispute pending in the U.S. District Court of Delaware pursuant to a global settlement and patent cross-licensing agreement relating to digital PCR technology.
· Edwards Lifesciences (EW) Q2 adj EPS $0.66 vs. est. $0.65; Q2 revs rose 11% y/y to $1.53B vs. est. $1.5B; sees FY adj EPS $2.50-$2.60, vs. prior $2.48-$2.60 and sales $5.9B-$6.1B from prior view of high end of $5.6BB-$6.0B; Q2 TAVR sales grew 9%; constant currency sales grew 10%.
· National Vision Holdings Inc. (EYE) shares fell after hours after the optical retailer said that its contract with Walmart Inc. (WMT) won’t be renewed after it ends in February.
· ICON Plc (ICLR) Q2 adj EPS $3.11 vs. est. $3.08; Q2 revs rose 4.4% y/y to $2.02B, in-line with consensus; sees FY23 adj EPS $12.63-$12.91 vs. est. $12.60 and revenues $8.07B-$8.21B, vs. consensus $8.14B.
· Molina Healthcare (MOH) Q2 EPS $5.65 vs est. $5.10 on revs $8.327Mm vs est. $8.317Mm; guides FY adj EPS at least $20.75 vs est. $20.39.
Industrials & Materials
· Carlisle Co (CSL) Q2 adj EPS $5.18 vs est. $4.63 on revs $1.526B vs est. $1.561B; expects FY revs -low-teens vs est. -10.85%.
· Carrier Global (CARR) Increasing adjusted EPS guidance from $2.50 – $2.60 to $2.55 – $2.65 based on strong first half performance and despite the deconsolidation of Kidde-Fenwal, Inc.
· Enovix (ENVX) signs Manufacturing Agreement with YBS International Berhad for Fab2 in Malaysia, securing $70 million of non-dilutive funding; Q2 EPS loss (-$0.19) vs. est. loss (-$0.22).
· Graco (GGG) Q2 adj EPS $0.75 vs est. $0.80 on revs $559.6Mm vs est. $576.08Mm; says incoming order rates are in line with expectations, but comparisons for remainder of the year will be more difficult because off pricing actions implemented last year; confirming FY revs outlook of +low-single-digit organic, constant currency vs est. +4.8%.
· IDEX Corp. (IEX) Q2 adj EPS $2.18 vs. est. $2.12; Q2 sales $846.2M vs. est. $851.1M; Ad adj EBITDA $240.7M vs. est. $233.3M; lowers full year guidance in response to softening second half outlook; FY23 organic sales are projected to decline 1 to 2% over prior year, with Gaap eps of $6.80 – $6.90 (adjusted eps of $7.90 – $8.00).
· L3Harris Technologies (LHX) Q2 adj EPS $2.97 vs est. $2.94 on revs $4.69B vs est. $4.373B; guides FY adj EPS $12.15-12.55 vs est. $12.30; says evaluating non-core assets to potentially accelerate near-term focus of debt repayment; moving forward to close deal with AJRD on or about July 28; continues to experience strong demand for products and solutions.
· Landstar Systems (LSTR) Q2 EPS $1.85 vs. est. $1.83; Q2 revenue $1.37B vs. est. $1.36B; Q2 truck rev per load underperformed sequential historical patterns experienced during pre-pandemic periods by 6%.
· United Rentals (URI) Q2 adj EPS $9.88 vs est. $9.01 on revs $3.554B vs est. $3.452B, adj EBITDA $1.695B vs est. $1.629B.
Technology, Media & Telecom
· Meta Inc. (META) Q2 EPS $2.98 vs est. $2.91 on revs $31.999B vs est. $31.116B; Facebook DAU 2.06B vs est. 2.03B, MAU 3.03B +3% y/y; sees 3Q revs $32-34.5B vs est. $31.298B.
· eBay Inc. (EBAY) Q2 adj EPS $1.03 vs. est. $0.90; Q2 revs $2.5B vs. est. $2.27B; Q2 GMV $18.2B, down 2% on as-reported basis; sees Q3 adj EPS 96c-$1.01 vs. est. $0.92 and revs $2.46B-$2.52B, vs. consensus $2.23B.
· Flex Inc. (FLEX) Q1 adj EPS $0.57 vs. est. $0.51; Q1 revs $7.3B vs. est. $7.28B; sees Q2 EPS $0.55-$0.60 vs. est. $0.58 and revs $7.3B-$7.7B vs. est. $7.64B.
· Impinj (PI) Q2 EPS $0.33 vs. est. $0.29; Q2 revs $85.98M vs. est. $85M; Q3 adj gross margin 53.3% and Ebitda $10M; &D expenses $23.4M, +27% y/y; guides Q3 EPS loss (12c)-(6c) vs. est. +$0.38 and revs $63M-$66M, below consensus $88.11M.
· Lam Research (LRCX) Q4 EPS $5.98 vs est. $5.07 on revs $3.207B vs est. $3.13B, adj gr mgn 45.7%; guides Q1 revs $3.1-3.7B vs est. $3.3B, adj gr mgn 45.5-47.5%, adj op mgn 27-29%, adj EPS $5.30-6.80 vs est. $5.60.
· Seagate Technologies (STX) Q4 EPS loss (-$0.18) vs. est. loss (-$0.25); Q2 revs $1.6B vs. est. $1.68B; sees Q1 revenue of $1.55B, plus/minus $150M vs. est. $1.74B and EPS loss per share (-$0.16) plus/minus -$0.20 vs. est. $0.07.
· ServiceNow Inc. (NOW) Q2 adj EPS $2.38 vs est. $2.05 on revs $2.075B vs est. $2.127B, adj FCF $451Mm; guides Q3 revs $2.185-2.195B vs est. $2.231B; sees FY revs $8.58-8.6B vs est. $8.831B.
· Tyler Technology (TYL) Q2 adj EBITDA $125.5Mm vs est. $120.6Mm on revs $504.279Mm vs est. $491.3Mm; guides FY revs $1.94-1.965B vs est. $1.956B and adj EPS $7.60-7.75 vs est. $7.60.
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.