Morning Preview: June 25, 2020

Auto PostDaily Market Report

Early Look

Thursday, June 25, 2020





DJ Industrials




S&P 500










Stock futures are pointing to a lower open as concerns over increasing coronavirus cases continues to raise the fears of slowing the economy further after initial signs of improvement. States and businesses are dealing with the issue if they should remain open or close to help slow the further spread of the virus that has run rampant over the last week especially in some of the most heavily populated states (FL,CA, TX as well as AZ, WA, NC and SC). Stocks have pared losses ahead of a busy morning of economic data where another 1.38M are expected to file for first time unemployment claims today while 20M are expected to remain on unemployment. Meanwhile, orders for durable goods are seen rebounding 10.6% in May, while the final GDP reading for Q1 probably decreased at a 5.0% annualized rate. In Asian markets, The Nikkei Index fell -274 points to 22,259, the Shanghai Index and the Hang Seng Index were both closed. In Europe, the German DAX is higher a little over 30 points to 12,125, while the FTSE 100 is down about -10 points to 6,110.


Stocks sank Wednesday, with the S&P 500 and Dow selling off by more than 3% at session lows as rising numbers of Covid-19 infections in some regions spooked investors. Florida and California reported record high one-day tallies for new confirmed coronavirus cases at 5,508 and 7,149, respectively. Arizona on Wednesday saw another 1,795 positive cases after adding a record 3,591 on Tuesday. In Texas, Houston’s Mayor said that the city’s intensive care units were at 97% of capacity. NY, NJ and CT impose quarantines on travelers from COVID-19 hot-spot states. The rising cases along with tariff talk with Europe and a weak economic outlook (the IMF downgraded its global growth forecast for 2020 to -4.9% from -3.0% in April) all weighed on stocks as the Nasdaq snapped its 8-day win streak. Stocks have been buoyed of late in part by optimism over a potential new stimulus/relief bill out of Washington, hopes for a coronavirus vaccine and some improving economic data in the U.S. and overseas.


Market Closing Prices Yesterday

·     The S&P 500 Index plunged -80.96 points, or 2.59%, to 3,050.33

·     The Dow Jones Industrial Average fell -710.16 points, or 2.72%, to 25,445.94

·     The Nasdaq Composite dropped -222.20 points, or 2.19%, to 9,909.17

·     The Russell 2000 Index declined -49.60 points, or 3.45% to 1,389.74


Economic Calendar for Today

·     8:30 AM EST      Gross Domestic Product (GDP) Annualized for Q1-T…est. (-5.0%)

·     8:30 AM EST      Personal Consumption for Q1-T…est. (-6.8%)

·     8:30 AM EST      Core Price QOQ, Q1-T…est. 1.6%

·     8:30 AM EST      Weekly Jobless Claims…est. 1.32M

·     8:30 AM EST      Continuing Claims…est. 20.0M

·     8:30 AM EST      Advance Goods Trade Balance for May…est. (-$68.1B)

·     8:30 AM EST      Wholesale Inventories MoM for May…est. 0.4%

·     8:30 AM EST      Durable Goods Orders, May-P…est. 10.5%

·     10:30 AM EST    Weekly EIA Natural Gas Inventory Data

·     11:00 AM EST    Kansas City Fed Manufacturing Activity for June…est. (-3)






WTI Crude















10-Year Note





Sector News Breakdown


·     KB Home (KBH) shares fell -13%; Q2 EPS 55c/$914M vs. est. 56c/$1.07B; Q2 net orders of 1,758 vs. consensus of 2,754 and 4,064 in year-ago quarter; net order value of $688.4M vs. consensus of $1.09B and $1.53B in Q2 2019; said June-to-date, “we have achieved a modestly positive year-over-year comparison, as orders have returned to more normalized levels

·     McCormick (MKC) Q2 adj EPS $1.47 on sales $1.4B vs. est. $1.13 and $1.36B; reaffirms its long-term financial objectives and capital allocation priorities but isn’t providing FY20 guidance

·     MGM Resorts International (MGM) said it will require that all guests wear face masks inside public spaces at all of its U.S. outlets effective Friday. Previously, the casino operator only required employees to wear masks.

·     TopBuild (BLD) will replace Tech Data Corp. (TECD) in the S&P MidCap 400, and Retail Properties of America (RPAI) will replace TopBuild in the S&P SmallCap 600.



·     SolarEdge (SEDG) downgraded to Sell from Neutral and Vivint Solar (VSLR) was downgraded to Neutral from Buy at Goldman Sachs as remains constructive on the broader outlook for U.S. residential solar in the long term, but after a 42% rally in the solar stocks over the past 3 months, he now sees limited upside in the near-term

·     Occidental Petroleum (OXY) has asked for bids by July 1 for properties it is selling in Wyoming and Colorado, Wyoming’s Gov. Gordon says.

·     Marathon Oil (MRO) downgraded to Equal Weight from Overweight at Wells Fargo



·     Ally Financial (ALLY) and CardWorks announced that they have mutually agreed to terminate their merger agreement, which had been announced on February 18. The board of directors for each company approved the termination after carefully considering the impacts of COVID-19 on global markets and the economy. Neither party will incur any termination or break-up fees

·     Mastercard (MA) switched volume continues to improve since the week ending May 28, with U.S. switched volume increasing 5% in the week ended June 21, up from +3% in the week ended June 14, and -1% for the week ended June 7. At its worst, U.S. switched volume fell 6% in each of the weeks ended May 7 and May 14.

·     Raymond James Financial (RJF) client assets under administration of $858.2B in May rose 9% YoY and 4% MoM; financial AUM of $143.6B increased 5% YoY and MoM

·     Brandywine Realty Trust (BDN) will replace Briggs & Stratton (BGG) in the S&P SmallCap 600

·     BRP Group (BRP) 11.5M share Secondary priced at $13.25



·     UniQure (QURE) signed an agreement with CSL Limited (CMXHF) unit CSL Behring granting the latter global rights to gene therapy for the treatment of hemophilia B; QURE will receive $450M in upfront cash, up to $1.6B in milestones and tiered double-digit royalties on net sales.

·     Castle Biosciences (CSTL) 2M share Secondary priced at $37.00

·     NantKwest (NK) 7.41M share Spot Secondary priced at $9.50

·     1Life Healthcare (ONEM) 8.3M share Secondary priced at $31.00

·     Evelo Biosciences (EVLO) 12M share Spot Secondary priced at $3.75

·     Magenta Therapeutics (MGTA) 7.5M share secondary priced at $8.00

·     Insmed (INSM) announces final results from a Phase 2 clinical trial, WILLOW, evaluating brensocatib (INS1007) in patients with non-cystic fibrosis bronchiectasis, saying the study met the primary endpoint demonstrating a statistically significant improvement in time to first pulmonary exacerbation over the 24-week treatment period compared to placebo.


Industrials & Materials

·     H.B. Fuller (FUL) Q2 adjusted EPS 68c on revs $675M vs. est. 55c/$664.27M; guides 3Q revs down 5-10% YOY, sees 3Q adj EBITDA $95-105Mm vs. est. $100Mm; says remains on track to achieve $200Mm debt repayment for 2020

·     GMS Inc. (GMS) Q4 adj EPS 56c vs. est. 52c and reports Q4 revenue down 1.2% YoY to $770.9M vs. est. $723.46M


Technology, Media & Telecom

·     Disney (DIS) said it is delaying the planned July 17 reopening of California’s Disneyland resort, after state officials indicated they were not planning to issue guidelines to reopen theme parks until after July 4

·     Kaleyra (KLR) 7.78M share Secondary priced at $4.50

·     BlackBerry (BB) Q1 adjusted EPS 2c/$214M vs. est. loss (1c)/$216.8M; Q1 Non-GAAP gross margin was 71% versus 75% last year and GAAP gross margin was 69% versus 72% last year; said given the uncertainty across the global economy due to the COVID-19 pandemic, BlackBerry is not providing a financial outlook for fiscal 2021

·     Yandex (YNDX) 8.12M share Secondary priced at $49.25

·     AT&T (T) has used proceeds from a bond offering to pay down $1B in term loans early, and issued notice for redemptions of several other notes.

·     Quantum (QMCO) Q4 adjusted EPS loss (6c)/$88.2M vs. est. 1c/$87.03M; sees Q1 adjusted EPS (17c), plus or minus 1c vs. est. loss (3c) and revs $73M, plus or minus $1M vs. est. $82.29M

·     Chinese telecom equipment giant Huawei lost out to Nokia (NOK) and Ericsson (ERIC) to build the main next-generation networks for Singapore 5G, but may be involved in the broader ecosystem at a reduced capacity


Market commentary provided by Catena Media Financials US, LLC, 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.

Live Trading

Open an Account

Paper Trading