Early Look

Thursday, September 15, 2022

Futures	Up/Down	%	Last
Dow	-55.00	0.18%	31,196
S&P 500	-9.25	0.23%	3,956
Nasdaq	-50.50	0.41%	12,172

 

 

U.S. futures are lower, with the S&P trading in a very narrow range overnight – 3,977 high and 3,951.50 low, looking to extend yesterday’s bounce, but remain on track for sharp weekly losses. News from the White House that they had reached a tentative agreement to avoid a potential railway strike that threatened to shut down a key part of the U.S. economy may help sentiment early. The pact averts a walkout by over 100,000 workers and disruptions to the country’s supply chain that “would have had catastrophic impacts,” a govt spokesperson said. US stocks recovered a bit of ground Wednesday, a day after the big stock indexes’ worst losses in more than two years. Producer-price index data fell in line with expectations, offering a hopeful sign that inflation pressure could be waning for some items following yesterday’s hot CPI reading. In Asian markets, The Nikkei Index rose 57 points to 27,875, the Shanghai Index fell -37 points to 3,199, and the Hang Seng Index rose 83 points to 18,930. In Europe, the German DAX is down a few points to 13,017, while the FTSE 100 rises 20 points to around the 7,300 level. US stock markets fate rests on the Fed meeting next week and their commentary about futures rate hikes, with a minimum 75 bps hike expected next Wednesday. Futures turn red in the last few minutes on headlines from Gazprom saying nearly full EU inventories can’t guarantee safe winter.

Market Closing Prices Yesterday

·     The S&P 500 Index gained 13.32 points, or 0.34%, to 3,946.01

·     The Dow Jones Industrial Average rose 30.12 points, or 0.10%, to 31,135.09

·     The Nasdaq Composite climbed 86.10 points, or 0.74%, to 11,719.68

·     The Russell 2000 Index advanced 6.89 points, or 0.38% to 1,838.46

 

Economic Calendar for Today

·     8:30 AM ET           Weekly Jobless Claims…est. 226K

·     8:30 AM EST         Continuing Claims…est. 1.475M

·     8:30 AM ET           NY Empire Manufacturing Index for September…est. (-13.0)

·     8:30 AM ET           Import Prices M/M for August…est. (-1.2%)

·     8:30 AM ET           Export Prices M/M for August…est. (-1.2%)

·     8:30 AM ET           Philly Fed Business Outlook for September…est. 2.8

·     8:30 AM ET           Advance Retail Sales M/M for August…est. 0.0%

·     8:30 AM ET           Retail Sales Ex: Autos for Aug…est. +0.1%

·     9:15 AM ET           Industrial Production M/M for August…est. +0.1%

·     9:15 AM ET           Capacity Utilization for Aug…est. 80.3%

·     10:00 AM ET         Business Inventories M/M for July

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

 

Earnings Calendar:

·     Earnings Before the Open: None

·     Earnings After the Close: ADBE

 

Other Key Events:

·     Goldman Sachs 2022 Communacopia + Technology Conference, 9/12-9/15, in San Francisco, CA

·     Truist Internet Growth Summit (virtual), 9/12-9/16

·     China Industrial Output and Retail Sales

 

 

Macro	Up/Down	Last
Nymex	-0.81	87.67
Brent	-0.63	93.47
Gold	-14.20	1,694.90
EUR/USD	-0.0004	0.9971
JPY/USD	0.44	143.59
10-Year Note	+0.045	3.457%

 

 

World News

·     Japan trade balance data for August was weak, falling JPY 2.82tn, and an adjusted deficit of JPY 2.37tn, both wider than estimates and the previous month. The headline deficit was a monthly record and means the trade balance has been negative for 13 months, the longest stretch in seven years.

·     The bull-bear spread in the American Association of Individual Investors (AAII) weekly survey was -19.9 vs -35.2 last week; Bulls rise to 26.1% from 18.1%; Neutrals fall to 27.9% from 28.7%; Bears fall to 46% from 53.3%

 

Sector News Breakdown

Consumer

·     Tesla (TSLA) upgraded to Hold at Needham

·     Decker’s (DECK) added to Wedbush best ideas list; AMD removed

 

Energy

·     APA (APA) boosts quarterly dividend to $0.25 from $0.13 and board of directors also approved a further 40M shares of additional share repurchase authorization.

·     NextEra Energy (NEE) said it intends to sell $2B of equity units, each of which will be issued in a stated amount of $50.00

·     CVR Energy (CVI) downgraded to Peer Perform from Outperform at Wolfe Research

·     Delek US (DK) upgraded to Outperform from Peer Perform at Wolfe Research

·     PBF Energy (PBF) upgraded to Outperform from Underperform at Wolfe Research

·     Phillips 66 (PSX) downgraded to Peer Perform from Outperform at Wolfe Research

·     China is considering allowing its oil refiners to export more fuel to help revive its economy – Bloomberg

 

Financials

·     Corebridge (CRBG) 80M share IPO priced at $21.00, the low end of $21-$24 range

·     Capital One (COF) reported charge-offs for August rose to 2.02% vs. 1.54% y/y; while Delinquencies jumped 2.76% vs. 1.79% y/y

·     Ethereum completed its long-awaited energy-saving software upgrade known as the ‘merge’, a key step to make the blockchain network faster and cheaper

·     PayPal Holdings (PYPL) said Blake Jorgensen, executive Vice President, and Chief Financial Officer, is taking a leave of absence for health reasons

 

Healthcare

·     Akero Therapeutics (AKRO) 7.7M share Secondary priced at $26.00

·     Ideaya Biosciences (IDYA) 7.62M share Spot Secondary priced at $10.50

·     Rhythm Pharmaceuticals (RYTM) 4.8M share Spot Secondary priced at $26.00

·     A Democratic House lawmaker with oversight authority is calling for an investigation into the largest for-profit hospital chain in the country, HCA Healthcare (HCA), STAT News reported https://bit.ly/3dhpsRa

 

Industrials & Materials

·     The White House said it had reached a tentative agreement to avoid a potential railway strike that threatened to shut down a crucial vein of the U.S. economy https://on.wsj.com/3BKpTx6 (watch shares of CSX, UNP, NSC)

·     Danaher Corporation (DHR) announced its intention to separate its Environmental & Applied Solutions segment to create an independent, publicly traded company; said Q3 core revenue growth is expected to be above the Company’s prior guidance range, vs. prior expectation of approximately $325 million.

·     Arconic (ARNC) said Q3 adjusted EBITDA is expected to be in the range of $135M-$150M as results will be impacted by production outages and other operational challenges; cuts FY22 revenue view to $9.2B-$9.5B from $9.6B-$10B, consensus $9.61B

 

Technology, Media & Telecom

·     Disney (DIS) CEO Bob Chapek said he’s weighing merging Hulu, which 67% owned by Disney and 33% owned by Comcast (CMCSA), with Disney+ – Bloomberg

·     Vimeo (VMEO) reports August revenue up 9%; August average revenue per user up 8%; and reports August subscribers up 1%