Overnight Summary: The S&P 500 closed Tuesday lower by -1.53% at 3986.37 from Monday higher by 0.07% at 4048.42. The overnight high of 4000.75 was hit at 6:15 a.m. EST. The low was hit at 3984 at 10:00 p.m. EST, a range of ~16 points high to low. At 7:30 a.m. EST, the S&P 500 (mini) was lower by -1.50 points which is -0.04%.
Earnings Out After The Close:
- Beats: CASY +0.36, BASE +0.16, WTI +0.07, ARLO +0.06, SUMO +0.06, CRWD +0.04, YEXT +0.02 of note.
- Flat: None of note.
- Misses: SFIX (0.25), CRCT (0.01), AGTI (0.01) of note.
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: None of note.
- New SPACs launched/News:
- The Growth for Good Acquisition Corporation (GFGD) : ZeroNox and GFGD enter merger agreement; to list publicly on the NASDAQ under ticker “ZNOX”.
- Nova Vision Acquisition Corp. (NOVV) Announces Extension of Combination Period and Additional Contribution to Trust Account to Extend Combination Period to April 10, 2023.
- ROC Energy Acquisition Corp. (ROC) Confirms Funding and Second Extension of Deadline to Complete Initial Business Combination.
- Secondaries Priced:
- BBIO: Announces Pricing of Public Offering of Common Stock. Sets Price for Public Offering of 8.82 Million Shares at $17 Each.
- MIRO: Announces Pricing of $10 Million Public Offering of Common Stock.
- PR: Prices secondary offering of 27.5 million shares of common stock at $11.00 per share.
- PTLO: Prices offering of 8.0 million shares of common stock at $21.05 per share.
- SHLS: Prices secondary offering of 24,501,650 shares of common stock by certain selling stockholders at $24.70 per share.
- SWX: Announces pricing of stock – 3,576,180 share offering of common stock at $60.12 per share.
- Notes Priced of note:
- Liberty Media (LSXMA) prices private offering of $500 million of 3.75% convertible senior notes due 2028; expected to result in approx. $491 million in net proceeds.
- RIVN: Prices $1.3 billion green convertible senior notes due 2029.
- TXN: Prices $1.4 billion of investment grade notes.
- Common Stock filings/Notes:
- AER: Filed Form F-3ASR.. Up to 111,500,000 Ordinary Shares AND Share Repurchase.
- BMRA: Announces Closing of $8 Million Underwritten Public Offering of Common Stock.
- CDTX: Announces Closing of Public Offerings of Common Stock and Preferred Stock and Full Exercise of Underwriter’s Option to Purchase Additional Shares in Public Offering of Common Stock.
- INBS: Proposed Public Offering. (Ladenburg bookmanager)
- MIRO: Announces Proposed Public Offering of Common Stock.
- MTEK: Filed Form F-3.. $100,000,000 of our ordinary share.
- PR: Announces Secondary Public Offering of Class A Common Stock.
- PTLO: Offering of Class A Common Stock in “Synthetic Secondary” Transaction.
- RVMD: Closing of Public Offering of Common Stock and Full Exercise of Underwriters’ Option to Purchase Additional Shares.
- SWX: Commencement Of Public Offering Of Common Stock.. $215,000,000 In Shares. (JPM And BAC Bookmanagers)
- VAPO: Filed Form S-3.. 17,502,244 Shares of Common Stock Pre-Funded Warrants to Purchase 4,402,508 Shares of Common Stock Warrants to Purchase 21,904,752 Shares of Common Stock.
- Direct Offering: None of note.
- Selling Shareholders of note:
- ASLE: Files for 8,679,171 share common stock offering by selling shareholders.
- SHLS: Launches public offering of 24,501,650 shares of Class A common stock by selling stockholders.
- Private Placement of Public Entity (PIPE):
- PYR: Announces Closing of $5 Million Non-Brokered Private Placement.
- Mixed Shelf Offerings:
- BANC: Filed Form S-3ASR .. Mixed Shelf.
- C: Filed Form S-3ASR Mixed Shelf.
- GGE: Filed Form S-3.. $500,000,000 Mixed Shelf.
- VRNA: Files mixed securities shelf offering.
- Debt Filing/Notes:
- MFC: announces Subordinated Debenture issue.
- Tender Offer: None of note.
- Convertible Offering & Notes Filed:
- Burlington Stores (BURL) entered into privately negotiated exchange agreements with holders of $110.3 mln 2.25% Convertible Senior Notes due 2025.
- IQ: Announces the Closing of Its Offering of US$600 Million Convertible Senior Notes due 2028 and Concurrent Repurchase of Convertible Senior Notes due 2026.
- MODN: Proposed Offering of $220.0 Million of Convertible Senior Notes Due 2028.
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: ARLO +11%, MAXN +9%, CRWD +6%, ZYME +5%, COCO +4% of note.
- Trading Down: SOUN -9%, SHLS -6%,YEXT -5%, PTLO -4%, ASLE -4% of note.
- News After The Close:
- Stocks making the biggest moves after hours: CRWD, SFIX, CRCT, MAXN (CNBC)
- FTC Twitter Investigation Sought Elon Musk’s Internal Communications, Journalist Names. (WSJ)
- CrowdStrike (CRWD) stock rallies as forecast shows confidence in new approach. (MarketWatch)
- Stitch Fix (SFIX) stock falls on weaker-than-expected sales outlook, executive shake-up. (MarketWatch)
- Silvergate (SI) Is in Talks With FDIC Officials on Ways to Salvage Bank. (Bloomberg)
- Binance: US Gets Judge’s Approval to Buy Voyager Digital Despite Regulator Objections. (Bloomberg)
- Intel (INTC) Wants $5 Billion More From Germany for a Chip Plant. (Bloomberg)
- “The yield curve starts dis-inverting before recession hits… that has not happened yet,” says @TruthGundlach (Jeffrey Gundlach head of Doubleline Capital) on investor webcast.
- Goldman Sachs (GS) Adds July Fed Hike To Forecast, Raises Peak Call -Raises US Terminal Rate Forecast By 25Bps To 5.5%-5.75%.
- PLTR $99.6 mln deal with U.S. State Department.
- Exchange/Listing/Company Reorg and Personnel News:
- BIIB: Caroline Dorsa to Succeed Stelios Papadopoulos as Chair of Biogen Board of Directors.
- The Vita Coco Company (COCO) appoints Corey Baker to CFO role.
- Community Healthcare Trust (CHCT) appoints David H Dupuy, former Interim CEO since February 10, as permanent CEO.
- Genco Shipping & Trading (GNK) COO Robert Hughes resigned in connection with an internal consolidation of the Company’s business departments.
- Nike (NKE) Announces Senior Leadership Shifts to Drive Continued Future Growth.
- PYPL Says Blake Jorgensen Stepping Down as CFO. (MarketWatch)
- The J.M. Smucker Co. (SJM) Announces Leadership Updates.
- Boston Beer Co (SAM) CFO Frank H Smalla stepping down to pursue another opportunity; Matthew D Murphy to serve as interim CFO. (MarketWatch)
- SFIX CFO to leave.
- Sun Country Airlines (SNCY) appoints Jennifer Vogel as chair of the board of directors.
- Buyback Announcements or News:
- AER: (see Common Stock filings above)
- BEST Inc. (BEST) Announces Share Repurchase Program.
- Pembina Pipeline (PBA) approves renewal of share repurchase program.
- Stock Splits or News: None of note.
- Dividends Announcements or News:
- EBAY Goes ex div tomorrow for $0.25
- LHX Goes ex div tomorrow for $1.14
- VFC Goes ex div tomorrow for $0.30
What’s Happening This Morning: Futures value reflects the change with fair value.
S&P 500 -1, Dow Jones -17, NASDAQ +3, and Russell 2000 +2. (as of 7:58 a.m. EST). Asia lower ex Japan and Europe lower ex Germany. VIX Futures are at 19.96 from 19.15 yesterday. Gold and Silver lower with Copper higher. WTI Crude Oil and Brent lower with Natural Gas lower as well. US 10-year Treasury sees yields at 3.72% from 3.944% since yesterday. The U.S. Dollar is higher versus the Euro, lower versus the Pound and higher against the Yen. Bitcoin is at $22,010 from $22,364 yesterday, lower by -0.09%.
Sector Action – (1/3/6/12/YTD Updated Weekly with Monday release):
- Daily Positive Sectors: None of note.
- Daily Negative Sectors: Basic Materials, Real Estate, Financial, Energy, Utilities of note.
- One Month Winners: Industrials, Energy of note.
- Three Month Winners: Basic Materials,Technology, Industrials of note.
- Six Month Winners: Basic Materials, Industrial, Financial of note.
- Twelve Month Winners: Energy, Industrial of note.
- Year to Date Winners: Technology, Consumer Cyclical, Communication Services of note.
The Dow Jones Industrial Average dropped nearly 600 points Tuesday after Federal Reserve Chair Jerome Powell said the central bank would likely lift interest rates more than previously expected to fight inflation and cool down the economy. The blue-chip index fell 574.98 points, or 1.7%, to 32856.46. The S&P 500 dropped 62.05 points, or 1.5%, to 3986.37. The technology-focused Nasdaq Composite retreated 145.40 points, or 1.2%, to 11530.33. The declines were broad: 29 of the 30 stocks in the Dow declined as did all 11 sectors in the S&P 500. Bank stocks, which are particularly sensitive to rising rates, were among the day’s biggest losers. Shares of Wells Fargo dropped $2.18, or 4.7%, to $44.45 while M&T Bank MTB -5.21%; The S&P 500’s financials sector dropped 2.5%, its worst day since September. (WSJ – edited by QPI)
Click here for a video explanation of Erlanger Value Lines.
Upcoming Earnings Of Note: (From Chartroom Software – sorted by market cap, highest to lowest with most visible names)
- Wednesday After the Close:
- Thursday Before the Open:
Earnings of Note This Morning:
- Beats: REVG +0.13, KFY +0.09, CPB +0.06, IMXI +0.03, NVEI +0.03, ABM +0.02, VERX +0.02 of note.
- Flat: LTH of note.
- Misses: UNFI (0.66), LFST (0.58), VRDN (0.41), COCO (0.09) of note.
- Still to Report: BF.B , KROS , PLCE of note.
- Positive Guidance: CRWD, ARLO, LFST, VERX, NVEI, CPB of note.
- Negative Guidance: AGTI, BASE, UNFI, COCO of note.
Erlanger Research Advance/Decline Chart:
Gap Ups & Down In Early Pre-Market:
- Gap Up: MESO +14%, MAXN +13%, ZYME +12%, ARLO +12%, WE +8%, CRWD +7%, DBVT +6%, WTI +4%, COCO +4% of note.
- Gap Down: SOUN -10%, SHLS -8%, SFIX -7%, YEXT -6%, MBC -6%, PTLO -5%, BANC -5%, ASLE -5%, AGTI -4% of note.
Insider Action: ECVT sees Insider buying with dumb short selling. No stock 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 Pre-Market Moves: CRWD, OXY, TSLA, SFIX, MAXN, CRCT, AY, JWN (CNBC)
- 5 Things to Know Before Stock Market Opens Wednesday. (CNBC)
- 5 Things You Need to Know to Start Your Day. (Bloomberg)
- Bloomberg Lead Story: Global Investors Contemplate Fallout From U.S. Rates Reaching 6%. (Bloomberg)
- Bloomberg Most Read Story: Deepest Yield Inversion Since Volker Suggests Hard Landing. (Bloomberg)
- Stock Market Futures are flat following selloff fueled by Powell’s comments. (CNBC)
- Mortgage demand recovers slightly despite rising interest rates. (CNBC)
- Adidas warns of first annual loss in three decades and cuts dividend after split with Ye. (CNBC)
- Eli Lilly (LLY) move to lower insulin costs disrupts market. (WSJ)
Moving Average Update:
- Score slides to 45% from 74%.
- President’s Public Schedule:
- The President receives the Presidential Daily Briefing, 9:30 a.m. EST
- Press Briefing by Press Secretary Karine Jean-Pierre, 12:30 p.m. EST
- MBA mortgage Applications 7:00 a.m. EST
- MBA Mortgage Applications: Composite: +7.4%, Purchase: +6.6%, ReFi: +9.4%
- U.S MBA 30-YEAR MORTGAGE RATE ACTUAL: 6.79% VS 6.71 % PREVIOUS
- U.S MBA MORTGAGE APPLICATIONS (WOW) ACTUAL: 7.4% VS -5.7% PREVIOUS
- February ADP Employment Report is due out at 8:30 a.m. EST and expected to rise to 47.8%195,000 from 106,000.
- International Trade in Goods 8:30 a.m. EST
- JOLTS 10:00 a.m. EST
- EIA Petroleum Report 10:30 a.m. EST
- The Federal Reserve Beige Book for March is due out at 2:00 p.m. EST.
Federal Reserve / Treasury Speakers:
- Federal Reserve Chair Jerome Powell 10:00 a.m. EST
- Diversey (DSEY) to be Acquired by Solenis for $4.6 Billion.
- Fifth Third (FITB) Announces Acquisition of Big Data Healthcare, a Payments Company Serving National Health Systems, Physicians.
- HNI Corporation (HNI) to Acquire Kimball International for $485 million in cash and stock.
- Shore Bancshares, Inc. (SHBI) and The Community Financial Corporation (TCFC) Announce Receipt of Regulatory Approval for Merger of Equals.
Meeting & Conferences of Note:
- Company Meetings: JCI, QCOM, RCAT
- Fireside Chat: None of note.
- Investor/Analyst Day/Calls: CMI, COHR, DOV, LOGN, MAT, PFX, SPOT, VWDRY
- Update: None of note.
- R&D Day: None of note.
- Company Event: None of note.
- Industry Meetings:
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: