Early Look

Thursday, June 13, 2024

Both the S&P 500 and Nasdaq composite closed at record levels on Wednesday for a third straight session, boosted by strength in technology stocks as AAPL, ORCL, GOOGL, MSFT touched new fresh record highs, as markets were buoyed by a “tamer” consumer prices (CPI) inflation report, raising hopes for Fed rate cuts. The FOMC Policy meeting late yesterday dampened any hopes of a near term cut as the Fed now projects only one 25 bps cut this year (vs view of two prior meeting) but boosted their outlook to four cuts in 2025 (up from three prior). Markets pared gains late in the day following comments but still ended with solid gains. Today markets get the producer price index (PPI) inflation reading at 8:30 AM. TSLA shares jumping 5% pre-market after CEO musk said ahead of the company’s shareholder meeting that two key proposals to re-ratify his pay package and move the EV maker’s legal home to Texas from Delaware are passing by “wide margins.” Semiconductors are looking to make another new high, boosted by shares of Broadcom (AVGO) rising 13% overnight after results. U.S. Treasury yields pared earlier declines as investors weighed a market-pleasing inflation report against lowered interest rate cut expectations. The dollar shed some weakness after the U.S. Federal Reserve concluded its two-day policy meeting by leaving interest rates unchanged. In Asian markets, The Nikkei Index fell -156 points to 38,720, the Shanghai Index fell -8 points to 3,028, and the Hang Seng Index rose 174 points to 18,112. In Europe, the German DAX is down -215 points to 18,415, while the FTSE 100 is down -41 points to 8,174.

• The Dow Jones Industrial Average slid -35.21 points, or 0.09%, to 38,712.21.
• The Nasdaq Composite jumped 264.89 points, or 1.53%, to 17,608.44.
• The Russell 2000 Index advanced 32.75 points, or 1.62% to 2,057.10.

• 8:30 AM ET                  Continuing Claims…est. 1.798M
• 8:30 AM ET                  Producer Price Index (PPI) M/M headline for May…est. +0.1% (prior +0.5%)
• 8:30 AM ET                  Producer Price Index (PPI) M/M headline for May…est. +2.5% (prior +2.1%)
• 8:30 AM ET PPI Core (Ex: Food & Energy) M/M for May…est. +0.3% (prior +0.5%)
• 8:30 AM ET PPI Core (Ex: Food & energy) Y/Y for May…est. +2.4% (prior +2.4%)
• 10:30 AM ET                Weekly EIA Natural Gas Inventory Data
• 12:00 PM ET                Fed’s Williams Interviews Treasury Secretary Yellen
• 1:00 PM ET U.S. Treasury to sell $25B in 30-year notes.

• Earnings After the Close: ADBE POWW RFIL

• Goldman Sachs Annual Global Healthcare Conference, 6/10-6/13, in Miami, FL
• Jefferies FinTech Conference, 6/12-6/13, in New York
• Oppenheimer 2024 Software Bus Tour, 6/10-6/13, in San Francisco
• RBC Capital Global Mining & Materials Conference, 6/13-6/14, in New York

• Oxford Industries (OXM) Q1 adj EPS $2.66 vs. est. $2.68; Q1 revs $398M vs. est. $404.8M; Q1 gross margin 64.9%; guides FY25 EPS $8.60-$9.00, down from prior $9.30-$9.70 and lowers FY25 sales to $1.59B-$1.63B, from $1.63B-$1.67B.
• Torrid Holdings (CURV) Q1 adj EBITDA $38.222Mm vs est. $32.84Mm on revs $279.771Mm vs est. $282.4Mm, comps -9%, gr mgn 41.3%; guides Q2 net sales $280-285Mm vs est. $290.2Mm and adj EBITDA $30-34Mm vs est. $33.87Mm; sees FY net sales $1.135-1.155B vs est. $1.151B, adj EBITDA $109-116Mm vs est. $114.2Mm, CAPEX $20-25Mm.
• J. Jill (JILL) 2M share Spot Secondary priced at $31.00.
• Kimberly-Clark (KMB) upgraded to Buy from Underperform at Bank America and raised tgt to $160 from $115.
• Planet Fitness (PLNT) to buy back shares under a $500M authorization.
• Tesla (TSLA) shares rise 5% pre mkt after CEO Elon Musk said two key proposals to re-ratify his pay package and move the EV maker’s legal home to Texas from Delaware are passing by “wide margins.”
• Tesla (TSLA) expects to increase the price of its Model 3 because of import duties to be levied by the E.U. on cars made in China, the carmaker said on its website on Thursday, without specifying the size of the price hike.
• Tesla (TSLA) shareholder meeting being held today, as investors will vote on CEO Elon Musk’s $56-billion compensation package and the co’s reincorporation in Texas, from Delaware. Analysts have flagged the risk of Musk potentially leaving and prioritizing artificial-intelligence startup xAI and social media platform X if the pay package does not pass.

• Gold Fields (GFI) lowered its gold production guidance for the year to between 2.2 million and 2.3 million ounces of gold, down from a previous target of 2.33 million to 2.43 million ounces citing worse-than-expected impacts from winter weather in Chile, setting back the South African gold miner’s ramp-up of the key Salares Norte project.
• 3M (MMM) announced that it purchased a group annuity contract and will transfer a portion of its U.S. pension payment obligations under the 3M Employee Retirement Income Plan, or ERIP, to Metropolitan Tower Life Insurance Company, an insurance company. Under the contract, 3M will transfer approximately $2.5B of its defined benefit pension obligations and related plan assets for approximately 23,000 U.S. retirees and beneficiaries to Met Tower Life.
• U.S. natural gas pipeline venture Mountain Valley Pipeline said on Wednesday it was preparing the $7.85-billion pipe from West Virginia to Virginia to operate, after receiving approval from a U.S. energy regulator. “Final preparations are underway to begin commercial operations,” a spokesperson at U.S. gas pipeline company Equitrans Midstream (ETRN), the lead partner in the Mountain Valley venture, told Reuters in an email. Reminder EQT agreed in March to buy Equitrans in an all-stock deal, which is expected to close in the fourth quarter.

• JP Morgan (JPM) Exec Rohrbaugh notes trading revenue in Q2 is trending slightly better than mid-single digit growth guidance and notes investment banking revenue could be up by 25%-30% year on year in Q2 – Reuters.
• W. R. Berkley (WRB) raises quarterly dividend by 9% to 12c per share, declares special dividend of 50c per share, and Board of Directors has approved a 3-for-2 common stock split to be paid in the form of a stock dividend to holders of record on June 24, 2024.

• Avidity Biosciences (RNA) files to sell $300M in common stock.
• Cara Therapeutics (CARA) announces outcome of Part A of KOURAGE-1 study evaluating oral Difelikefalin in notalgia paresthetica saying it did not demonstrate meaningful clinical benefit compared to placebo; said will discontinue clinical program in NP and explore strategic alternatives.
• Pfizer (PFE) CIFFREO study did not meet the primary endpoint of improvement in motor function among boys 4-7 years of age treated with DMD gene therapy vs placebo; watch shares of Sarepta (SRPT) with rival DMD drug.
• Ultragenyx (RARE) announces $350M common stock, warrants offering.

• MicroStrategy (MSTR) to offer $500M of convertible senior notes.