Early Look

Thursday, March 10, 2022

Futures	Up/Down	%	Last
Dow	-278.00	0.84%	32,885
S&P 500	33.25	0.77%	4,233
Nasdaq	-150.00	1.09%	13,582

 

 

S&P futures slide, down -0.7% or 30 points to 4,236.50 (off the overnight low 4,235.75) ahead of key CPI inflation data later this morning at 8:30 and as oil prices resume its upward momentum (up 4% above $113 per barrel). European stocks tumble while developments on Russia’s invasions of Ukraine continue to roil risk assets ahead of ECB’s meeting later today. Overnight, Ukraine and Russia failed to make progress in halting the war and bridging the vast differences between them at the first high-level talks between their foreign ministers since the Russian invasion began. Also overnight, the House approved legislation prohibiting U.S. imports of Russian oil, as lawmakers backed stronger punishment of Moscow. Stock markets were on cruise control higher on Wednesday, as the S&P500 finished 2.6% higher for largest gain since June 2020 as recently surging commodity prices, especially oil, cooled off while the war in Ukraine continues. The Dow rallied 2% and the Nasdaq surged 3.59% as well, ahead of key monthly consumer price (CPI) inflation data later this morning. Headline estimates for CPI m/m are to rise +0.8% and y/y +7.9% (after 7.5% prior) and core readings at +0.5% est. m/m and +6.4% y/y (vs. 6% prior). Meanwhile, rhetoric in Europe easing slightly as both the EU and U.S. appear to be making conciliatory gestures toward Russia after the EU said it won’t this week it won’t extend membership to Ukraine & the Pentagon isn’t sending Poland’s MiGs in an apparent effort to dial down tensions. This week has certainly been volatile as Monday top headlines read “the S&P 500 sinks 2.9% for worst close since October 2020”, while yesterday, “the S&P 500 closes 2.6% higher for biggest gain since June 2020”. Markets certainly not for the faint of heart! In Asian markets overnight, The Nikkei Index advanced nearly 4% or 970 points to 25,690, the Shanghai Index gained 1.22% to 3,296 and the Hang Seng Index climbed 1.27% or 262 points to 20,890. In Europe, the German DAX is down -2.35% or over 300 points to 13,520 after jumping over 7% on Wednesday, while the FTSE 100 drops over -1.1% to 7,100. Bitcoin prices slide over 6.8% to $39,000 in another volatile move in crypto.

Market Closing Prices Yesterday

·     The S&P 500 Index jumped 107.16 points, or 2.57%, to 4,277.86

·     The Dow Jones Industrial Average rose 652.65 points, or 2.00%, to 33,285.29

·     The Nasdaq Composite surged 460.00 points, or 3.60%, to 13,255.55

·     The Russell 2000 Index advanced 53.28 points, or 2.71% to 2,016.30

 

Economic Calendar for Today

·     8:30 AM ET          Weekly Jobless Claims…est. 216K

·     8:30 AM EST        Continuing Claims…est.

·     8:30 AM ET          Consumer Price Index (CPI) m/m for February…est. +0.8%

·     8:30 AM ET          Consumer Price Index (CPI) y/y for February…est. +7.9%

·     8:30 AM ET          CPI core Ex: Food & Energy m/m for February…est. +0.5%

·     8:30 AM ET          CPI core Ex: Food & Energy y/y for February…est. +6.4%

·     10:00 AM ET        Federal Budget for February

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

 

Earnings Calendar:

·     Earnings Before the Open: BBW, CCLP, COCO, DLTH, EMAN, GCO, GNCA, LAZY, ML, MYE, SEAT, SWIM, TH, TSQ, TXMD, UP, VITL

·     Earnings After the Close: ACHV, AOUT, BLNK, CAPR, CLSD, DOCU, GHLD, HCP, III, KINS, KLXE, LMNR, LOCO, LVOX, LZ, MLNK, NAPA, NNBR, OCX, ORCL, RIVN, RRGB, SHLS, TLYS, ULTA, VEC, WRAP, ZUMZ

 

Other Key Events:

·     Goldman Sachs European Chemicals Conference, 3/9-3/10, London

·     Morgan Stanley Technology, Media & Telecom Conference, 3/7-3/10, in San Francisco, CA

·     Wolfe FinTech Forum 2022 (virtual), 3/8-3/10

 

 

Macro	Up/Down	Last
Nymex	4.66	113.36
Brent	5.68	116.82
Gold	18.70	2,006.90
EUR/USD	-0.0031	1.1046
JPY/USD	0.13	115.95
10-Year Note	-0.012	1.936%

 

 

World News

·     The House moved Wednesday toward approving a massive spending bill anchored by $13.6 billion for battered Ukraine and its European allies after top Democrats abruptly dropped their plan to also include fresh funds to battle COVID-19. The Ukraine aid included $6.5 billion for the U.S. costs of sending troops and weapons to Eastern Europe and equipping allied forces.

·     Japan Feb PPI rises +0.8% m/m vs 0.6% consensus; 9.3% y/y vs 8.7% consensus; y/y rise the highest on record

 

Sector News Breakdown

Consumer

·     Amazon (AMZN) board of directors approved a 20-for-1 split of company’s common stock to be in effect on June 6^th and to buy back up to $10B of company’s stock

·     Fossil Inc. (FOSL) shares fell -12%; 4Q EPS $0.37 on revs $604.2Mm; guides FY net sales +2-6% with stronger yr/yr growth during 2H which is much lower than FOSL’s 2021 worldwide net sales growth of 16% on a reported basis and 14% in constant currency.

·     Homebuilders: KBH upgraded to Overweight from Neutral (tgt cut to $51 from $64) at JPMorgan, while TOL upgraded to Neutral from Underweight (tgt to $58 from $71) and downgrade MTH to Neutral from Overweight (tgt to $111 from $148)

·     Fiesta Restaurant (FRGI) 4Q adj EPS ($0.13) vs est. ($0.09) on revs $89.3Mm vs est. $88.5Mm

·     Just Eat Takeaway.com NV said it has launched a grocery convenience products home-delivery service in Spain in conjunction with Gorillas and local municipal markets in some cities.

·     Tesla (TSLA) increases prices of long-range versions of Model 3 and Model Y as nickel prices surge https://bit.ly/3J0f6zX

 

Energy, Industrials and Materials

·     General Electric Co (GE) reiterated its 2022 EPS forecast despite inflationary and supply-chain challenges ahead of an investor meeting later today; said it expects to post high-single-digit revenue growth this year on the back of a more than 20% increase in aviation revenue; sees year EPS in range $2.80-$3.50 and profit margin to grow by 150 bps and generate $5.5B-$6.5B FCF

·     Shares of infrastructure co’s may be in focus Thursday after the House passed a long-delayed $1.5 trillion spending bill that would fund the U.S. government through the rest of the fiscal year. Vulcan Materials (VMC), Martin Marietta Materials (MLM)

·     Costamare Inc. (CMRE) 4Q adj EPS $0.91 vs est. $0.97 on revs $283.9Mm vs est. $261.8Mm; declares special dividend of $0.50/share

·     EnerSys (ENS) announces new $150M stock repurchase authorization

·     Kronos Worldwide, Inc. (KRO) Q4 sales rose 20% to $496M vs. est. $490M; Q4 EPS $0.28 vs. est. $0.26; TiO segment profit in the fourth quarter of 2021 was $55.6 million as compared to $23.4 million in the fourth quarter of 2020

·     Mistras Group (MG) Q4 revs rose 6.5% to $171.2M vs. est. $162M; expects Q1 rev to be a low single digit increase as compared to Q1 2021; 2021 revenue of $677.1M, an increase of 14.3% of organic growth

·     Safe Bulkers (SB) Q4 EPS $0.39, in-line with estimates; Q4 revs $92.4M vs. est. $91.56M

 

Financials

·     AllianceBernstein L.P. (AB) preliminary assets under management decreased to $739 billion during February 2022 from $751 billion at the end of January. Firmwide net inflows were offset by market depreciation, resulting in a 2% decrease.

·     Artisan Partners Asset Management Inc. (APAM) reported that its preliminary assets under management as of February 28, 2022, totaled $159.8 billion

·     Franklin Resources, Inc. (BEN) preliminary month-end assets under management (AUM) of $1,486.9 billion at February 28, 2022, compared to $1,521.8 billion at January 31, 2022; decrease in AUM primarily reflected the negative impact of markets and long-term net outflows.

·     Invesco Ltd. (IVZ) reported preliminary month-end assets under management (AUM) of $1,531.4 billion, a decrease of 1.3% versus previous month-end. Preliminary average total AUM for the quarter through February 28 were $1,554.9 billion, and preliminary average active AUM for the quarter through February 28 were $1,057.8 billion.

·     Marqueta Inc. (MQ) Q4 EPS in line (7c) on revenue that increased +76% YoY to $155.4M vs est. $137.7M with total processing volume also +76% YoY to $33B; sees Q1 revenue growth +48-50%

·     Virtus Investment Partners, Inc. (VRTS) reported preliminary assets under management (AUM) of $183.7 billion as of February 28, 2022. In addition, the company provided services to $3.5 billion of other fee-earning assets, which are not included in assets under management.

 

Healthcare

·     Intellia Therapeutics (NTLA) announced that the U.S. FDA has granted orphan drug designation for Intellia’s ex vivo investigational T cell receptor, TCR, -T cell therapy, NTLA-5001, for the treatment of acute myeloid leukemia

·     ChromaDex (CDXC) 4Q EPS ($0.08) vs est. ($0.10) on revs $17.8Mm vs est. $18.6Mm; guides FY revs +15-20% vs est. +41%

 

Technology, Media & Telecom

·     Crowdstrike (CRWD) Q4 EPS $0.30 vs. est. $0.20; Q4 revs $431M vs. est. $410.9M; achieves record net new ARR of $217M with growth accelerating for the second consecutive quarter; ending ARR grows 65% YoY to exceed $1.7B; sees Q1 EPS $0.22-$0.24 vs. est. $0.17; sees Q1 revs $458.9M-$465.4M vs. est. $440.76M

·     Asana Inc. (ASAN) 4Q adj EPS ($0.25) vs est. ($0.28) on revs $111.9Mm vs est. $105.2Mm; guides 1Q adj EPS loss $0.35-0.36 vs est. loss $0.27 and revs $114.5-115.5Mm vs est. $110.9Mm; sees FY revs $527-531Mm vs est. $506.3Mm

·     Couchbase, Inc. (BASE) 4Q adj EPS ($0.22) vs est. ($0.33) on revs $35.1Mm vs est. $34Mm; sees 1Q revs $32.5-32.7Mm vs est. $32.6Mm; guides FY revs $146.5-147.5Mm vs est. $151.8Mm

·     Credo Technology (CRDO) 3Q adj EPS $0.03 vs est. ($0.01) on revs $31.8Mm vs est. $29.6Mm; sees 4Q revs $37-41Mm vs est. $38.1Mm and adj gr margin 59-61%

·     ChipMOS Technologies (IMOS) reported consolidated revenue of NT$2,096.9M (or $74.8M) for February; it marks an increase of 7.1% Y/Y and a decrease of 7.7% M/M