Please Note: Reminder market is closed on Monday. MLK Day. Next Morning Note is Tuesday 01/17/23
Overnight Summary: The S&P 500 closed Thursday higher by 0.34% at 3983.17 from Wednesday higher by 1.28% at 3969.61. The overnight high of 4005.25 was hit at 4:15 a.m. EST. The low was hit at 3985.25 at 7:15 a.m. EST, a range of ~20 points high to low. At 7:15 a.m. EST, the S&P 500 (mini) was lower by -15.75.
Earnings Out After The Close:
- Beats: WAFD +0.07.
- Flat: None of note.
- Misses: SJR (0.05).
Erlanger Research – Biggest Pops and Drops in Short Interest for NYSE and NASDAQ listings:
Unusual Options Activity:
Daily Screen in Erlanger Chartroom that highlights unusual Call and Put Options activity. It looks for volume outliers relative to the Open interest in Calls or puts. Usually, the stock price activity reflects the outlier situation (earnings/buyout/announcement), but once in a while, you can uncover stocks prior to a pop or drop.
- IPOs Priced or News:
- Skyward Specialty Insurance Group (SKWD:NASDAQ) prices 8,952,383 share IPO at $15.00 per share, at the midpoint of the $14-16 expected range.
- New SPACs launched/News:
- Stratospheric Exploration Leader World View to Go Public via SPAC Deal with Leo Holdings Corp. II (LHC).
- Secondaries Priced:
- ARCC: Prices offering of 10.5 million shares of common stock.
VICI: Prices offering of 26.35 million shares of common stock at $33.00 per share.
XPRO: Prices upsized 8 million secondary offering priced at $16.50.
- Notes Priced of note:
- WTI: Prices $275 Million Senior Second Lien Notes Offering.
- Common Stock filings/Notes:
- ARCC: Announces Public Offering — 9million shares. (MS, BAC, UBS, RBC and WFC Bookmanagers)
- VICI: Public Offering of Common Stock 24Million shares. (MS, BAC, Citi and JPM Bookmanager)
- Direct Offering: None of note.
- Selling Shareholders of note:
- SCLX: Files for 28,128,422 share common stock offering by selling shareholder.
- Private Placement of Public Entity (PIPE): None of note.
- Mixed Shelf Offerings:
- RSLS: Filed Form S-1.. Mixed Shelf.
- Debt Filing/Notes:
- LYV: Closing Of $1.0 Billion 3.125% Convertible Senior Notes Due 2029.
- Tender Offer: None of note.
- Convertible Offering & Notes Filed:
- SHPH: Private Placement of $4.3 Million of Senior Secured Convertible Note and Warrants.
Capital Raise Summary From The TradeXchange, bringing traders and investors real time news and Squawk Box, and other sources.
News After The Close:
- After Hours:
- Trading Up: SPCE +16%, HBI +8%, LC +4% of note.
- Trading Down: SCLX -8% of note.
- News Since The Close:
- Bed Bath & Beyond (BBBY) Quadruples as Retail Traders Fuel Latest Burst. (Bloomberg)
- Google (GOOGL) cuts Verily unit workforce by 15%. (Google Website)
- National Stockpile of Drugs releases Tamiflu due to shortages. (Bloomberg)
- Lending Club (LC) to reduce workforce 14%.
- Bank Of Japan Announces Unscheduled Bond Buying Operation.
- Apple (AAPL) CEO Cook To See Pay Reduced By Over 40% In 2023 To $49 million Cook’s Pay Reduction In Response To Shareholder Feedback (Bloomberg)
- ConocoPhillips (COP) in Talks to Sell Venezuelan Oil in U.S. to Recover Billions, $10 billion, It Is Owed. (WSJ)
- BAC: Subramanian Warns That A 10% Drop In Earnings Is Coming. (Bloomberg)
- WWE taps outside advisers for ‘strategic alternatives’ (MarketWatch)
- Federal Reserve Atlanta President Raphael Bostic:
- We Would Be Content To Move At 25 Bps If Interactions With Business Leaders Indicate That Inflation Is Declining.
- Inflation Report Today Was Welcome News And May Allow Fed To Move More Slowly
- Exchange/Listing/Company Reorg and Personnel News:
- Brookdale Senior Living (BKD) CAO Dawn Kussow will become CFO.
- China Eastern (CEA) Plans To Delist From New York Stock Exchange.
- China Southern Airlines (ZNH) intends to delist ADSs from NYSE.
- EXL (EXLS) Announces Appointment of Andreas Fibig to Board of Directors.
- Hanesbrands (HBI) CFO Michael Dastugue to step down.
- SatixFy Communications (SATX) appoints Ido Gur as CEO replacing David Ripstein.
- Buyback Announcements or News:
- WEN: Announces new $500 million share repurchase authorization..
- Stock Splits or News: None of note.
- Dividends Announcements or News:
- WEN raises quarterly dividend 100% to 25c per share..
What’s Happening This Morning: Futures value reflects the change with fair value.
S&P 500 -34, Dow Jones -238, NASDAQ -117, and Russell 2000 -13. (as of 8:01 a.m. EST). Asian markets are higher ex Japan Europe markets are trading higher. VIX Futures are at 21.35 from 22.30 yesterday. Gold higher with Silver and Copper lower. WTI Crude Oil and Brent are higher with Natural Gas higher. $ barely down. US 10-year Treasury sees yields at 3.478% from 3.528% yesterday. The U.S. Dollar is higher versus the Euro, higher versus the Pound and lower against the Yen. Bitcoin is at $18,892 from $18,193 yesterday, higher by 3.77%.
Sector Action – (1/3/6/12/YTD Updated Weekly with Monday release):
- Daily Positive Sectors: Energy, Basic Materials, Real Estate, Technology of note.
- Daily Negative Sectors: Consumer Defensive of note.
- One Month Winners: Financial, Basic Materials, Industrials of note.
- Three Month Winners: Basic Materials, Industrials, and Consumer Defensive of note.
- Six Month Winners: Industrials, Energy, and Basic Materials of note.
- Twelve Month Winners: Energy and Utilities of note.
- Year to Date Winners: Basic Materials, Consumer Cyclical, and Financial of note.
U.S. stocks climbed Thursday after the latest inflation data showed cooling price pressures for the sixth consecutive month, likely keeping the Federal Reserve on track to slow its pace of interest-rate increases. The S&P 500 added 13.56 points, or 0.3%, to 3983.17, while the Dow Jones Industrial Average gained 216.96 points, or 0.6%, to 34189.97. The technology-heavy Nasdaq Composite rose 69.43 points, or 0.6%, to 11001.10. The indexes bobbed between gains and losses early in the session before gaining steam midday. Consumer-price inflation slowed to 6.5% in December, down from 7.1% in November, the Labor Department said. Despite landing largely in line with economists’ expectations, one measure of services inflation—excluding energy services and the cost of owning or renting a home—offered encouragement that tighter monetary-policy is proving effective. (WSJ)
Click here for a video explanation of Erlanger Value Lines.
Upcoming Earnings Of Note: (sorted by market cap, highest to lowest with most visible names)
- Friday After the Close: None of note.
- Tuesday Before the Open: MS, GS, CFG, SBNY, EDU of note.
Earnings of Note This Morning:
- Beats: BLK +0.85, JPM +0.47, UNH +0.17, DAL +0.14, BAC +0.08, FRC +0.08, BK +0.06.
- Flat: None of note.
- Misses: WFC (0.47), C (0.11).
- Still to Report: None of note.
- Positive Guidance: HBI, WEN of note.
- Negative Guidance: none of note.
Erlanger Research Advance/Decline Chart:
Gap Ups & Down In Early Pre-Market:
- Gap Up: SPCE +16%, HBI +7%, BBBY +5% of note.
- Gap Down: SCLX -11% of note.
Insider Action: No stock sees Insider buying with dumb short selling. COIN sees Insider buying with smart short sellers.
Rags & Mags: Repeated stories from prior days never listed, i.e. “rehashed news”. Sorted by Global, U.S. and stock specific.
- Stocks making the biggest moves premarket: JPM TSLA, SPCE, WFC, DAL, BAC (CNBC)
- 5 things to know before the stock market opens. (CNBC)
- 5 Things You Need to Know to Start Your Day. (Bloomberg)
- Bloomberg Lead Story: Goldman Sachs Lost $1.2 Billion in Just Nine Months in Newest Division. (Bloomberg)
- Bloomberg Most Read Story: Google and Nvidia express concern to FTC over Microsoft Activision Deal . (Bloomberg)
- UK Economy ekes out November surprise of growth but recession still seen as inevitable. (CNBC)
- JP Morgan (JPM) tops estimates on revenues nut says mild recession is now the central case. (CNBC)
- Bank of America (BAC) tops estimates as higher rates offset declines in investment banking. (CNBC)
- Wells Fargo (WFC) expenses exceeded analyst estimates on regulatory hit. (Bloomberg)
- Higher labor costs dent Delta’s profit forecast but travel demand is strong. (CNBC)
- Tesla (TSLA) cuts prices in the U.S. and Europe. (CNBC)
Moving Average Update:
- Score remains at 88%…CPI be damned!
- President’s Public Schedule:
- The President receives the Presidential Daily Briefing, 9:00 a.m. EST
- The President welcomes Prime Minister Kishida Fumio to the White House, 11:15 a.m. EST
- The President holds a bilateral meeting with Prime Minister Kishida Fumio, 11:20 a.m. EST
- The President and Prime Minister Kishida Fumio participate in a working lunch, 11:45 a.m. EST
- Press Briefing by Press Secretary Karine Jean-Pierre and Senior Advisor for Public Engagement Keisha Lance Bottoms, 12:30 p.m. EST
- The President departs the White House en route New Castle, Delaware, 1:45 p.m. EST
- The President arrives in New Castle, Delaware, 2:40 p.m. EST
- Import and Export Prices 8:30 a.m. EST
- January University of Michigan Consumer Sentiment is due out at 10:00 a.m. EST and expected to come in at 60.50 from 59.70 in December.
- Baker Hughes Rig Count 1:00 p.m. EST
Federal Reserve / Treasury Speakers:
- Federal Reserve Philadelphia President Patrick Harker 10:20 a.m. EST
- Purple Innovation (PRPL) Rejects Unsolicited Proposal from Coliseum Capital Management.
- Semtech (SMTC) completes previously announced acquisition of Sierra Wireless (SWIR) in all-cash transaction representing a total EV of approximately $1.2 billion.
Meeting & Conferences of Note:
- Sellside Conferences:
- Sankey Research Virtual Refining Conference 2023
- Previously posted and ongoing conferences:
- Evercore 9th Annual Utility CEO Conference 2023 (01/12/23-01/13/23)
- H.C. Wainwright Biotech Conference 2023 (01/09/23-01/13/23)
- Morgan Stanley Latin America Executive Conference (01/10/23-01/13/23)
- Company Meetings: ADXS, ARAV.
- Fireside Chat: None of note.
- Investor/Analyst Day/Calls: INTC
- Update: None of note.
- R&D Day: None of note.
- Company Event: None of note.
- Industry Meetings: None of note.
- Previously posted and ongoing conferences:
- 26th North American Neuromodulation Society (NANS) Annual Meeting 2023 (01/12/23-01/15/23)
Top Tier Sell-side Upgrades & Downgrades:
The recommendations listed below in this “Upgrade/Downgrade” section are compiled from what we believe are Tier I, II and III firms. Recommendations posted are taken from a variety of sources each day and we only post upgrades or significant initiations as well as downgrades to underweight or sell. The purpose of this posting it to make the reader aware of market moving recommendations. None of these recommendations should be interpreted as actual recommendations from CAPIS or its employees.
Today’s Upgrades and Downgrades:
Previous Day’s Upgrades and Downgrades: