CAPIS Morning Note – 04/19/22: Stocks Mixed As We Head Into Tuesday Action

Overnight Summary: The S&P 500 closed Monday at 4391.69  from 4392.59  on Thursday up 0.04%. Futures have been mixed most of the night. The overnight high was hit at 8:00 p.m. EDT last night at 4,411. The low was hit at 4,371 at 5:55 a.m. EDT, a range of 22 points high to low. At…

Overnight Summary: The S&P 500 closed Monday at 4391.69  from 4392.59  on Thursday up 0.04%. Futures have been mixed most of the night. The overnight high was hit at 8:00 p.m. EDT last night at 4,411. The low was hit at 4,371 at 5:55 a.m. EDT, a range of 22 points high to low. At 7:25 a.m. EDT the current price is 4385 which is -0.04% and -1.75.

Breaking News: Russian President Putin calls for all foreign listings of Russian companies to be rescinded. Could be a big hit to the Oligarchs. (Bloomberg)

Earnings Out After The Close:

  • Beats: JBHT +0.035, HOPE +0.11, PNFP +0.08, ELS +0.02, FNB +0.02.
  • Flat: NBHC.
  • Misses: None of note.

Capital Raises:

  • IPOs Priced or News:
    • GOVX: Announces Closing of Initial Public Offering and Exercise of Full Over-Allotment Option.
    • EE: Closing of Initial Public Offering.
  • New SPACs launched/News:
    • Brilliant Acquisition Corporation (BRLI) Announces the Filing of a Registration Statement on Form S-4 in Connection with its Business Combination with Nukkleus Inc.
  • Secondaries Priced: None of note.
  • Notes Priced of note: None of note.
  • Common Stock filings/Notes:
    • CRNX: Closing of Underwritten Common Stock Offering.
    • LQDA: Closing of Public Offering of Common Stock and Full Exercise of Over-Allotment Option.
    • SST: Filed Form 424B5.. Up to 25,483,334 Shares of Class A Common Stock Issuable Upon Exercise of Warrants Up to 106,508,061 Shares of Class A Common Stock Up to 8,424,034 Warrants.
  • Pricing of Over-Allotment/Notes: None of note.
  • Direct Offering: None of note.
  • Selling Shareholders of note:
    • HLMN: Closes Secondary Offering of Common Stock by Selling Stockholders; Underwriters Fully Exercise Overallotment Option.
  • Private Placement of Public Entity (PIPE): None of note.
  • Mixed Shelf Offerings: None of note.
  • Convertible Offering & Notes Filed: None of note.

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: SMCI +13%, GFF +9%, ZEN +7%, FLGT +4%.
    • Trading Down: NTGR -11%, ACAD -7%.
  • News Since The Close:
    • Apollo Global (APO) may support Musk or another bidder offer for TWTR. (WSJ)
    • Fed Bullard:
      • Inflation will also moderate on its own .. Fed needs to ratify rate increases that are partially priced into markets already.
      • Minimum Fed Funds Rate is 3.5% — cannot do it all at once but should try to get there by end of year.
      • Must react to inflation problems right now .. War in Ukraine will have a meaningful impact in Europe — less in the US
      • May be reasonable if housing market cooled off a bit
    • Key Executive Departures Disrupt BlackRock’s (BLK) Secondary Fundraising. (WSJ)
    • TSLA:  Some employees of Tesla Giga Shanghai return to factory on April 19 and Tesla suppliers at Shanghai’s Lingang says they are producing Tesla parts under closed-loop conditions, and logistics are gradually recovering. (Shanghai Securities Journal).
    • China GDP Forecast Cut At UBS, Barclays And Standard Chartered. (Bloomberg)
    • Don’t blame stimulus checks for inflation, says Andrew Yang, who still supports sending free cash to most Americans (CNBC)
    • TSA no longer enforcing Covid mask mandate on planes, public transit after Federal Judge in Florida overturns CDC rule. (CNBC)
    • Uber (UBER) says riders and drivers are not required to wear masks.
    • US Equity ETFs have had some of the largest outflows on record over the past 10 days (even more so than at the peak of the pandemic!)… Longview Eco  (Carl Q Tweet CNBC)
    • U.S. 30-Year Treasury Yield Rises to 3% for First Time Since Early 2019. (Reuters)
    • Plug Power (PLUG) to supply Walmart (WMT) with green hydrogen to fuel retailer’s fleet of material handling lift trucks.
    • Russian/Ukraine News:
      • Russian Foreign Minister Says Another Stage of This Operation Is Beginning.
      • Zelensky: Russian offensive in eastern Ukraine has begun. (AP)
      • Russian forces seize control of Kreminna, a small city in eastern Ukraine. (Reuters)
  • Exchange/Listing/Company Reorg and Personnel News:
    • Ashford (AINC) agreed with Jeremy Welter, the COO of the Company, that, effective July 15, 2022, Mr. Welter would terminate employment.
    • Alta Equipment Group (ALTG) appoints Craig Brubaker as COO, effective immediately.
    • ARCA biopharma (ABIO) Establishes Special Committee of the Board of Directors.
    • Archer Aviation (ACHR) appoints Adam Goldstein as sole CEO.
    • Microvast (MVST) Announces Appointment of New Executive Officers.
    • NanoString (NSTG) Appoints Dr. Teresa Foy to Board of Directors.
    • Rollins Inc. (ROL) Announces Settlement of SEC Investigation.
  • Buyback Announcements:
    • National Health (NHI) approves stock repurchase plan for up to $240 million.
    • Retractable Technologies, Inc. (RVP) Announces Termination of Buyback Plan….or they retracted it!
  • Stock Splits: None of note.
  • Dividends Announcements:
    • Hasbro (HAS) increases dividend 3%.
    • Johnson & Johnson (JNJ) Announces Dividend Increase of 6.6% to $1.13 per share.

What’s Happening This Morning: Futures value reflects the change with fair value.

S&P 500 +3, Dow Jones +31, NASDAQ +12,  and Russell 2000 +4.  Europe lower and Asian lower ex Japan.  VIX Futures are at 24.68 from 25.28 yesterday morning. Gold, Silver and Copper lower. WTI Crude Oil and Brent Oil Futures lower with Natural Gas lower. $ is lower vs Euro, lower vs Pound and higher vs Yen. US 10 year Treasury sees yields at 2.895% from 2.843%. Bitcoin is at $40,823.97 from $39,049 yesterday morning higher by 0.66% this morning. As of 8:07 a.m. EDT.

Monday’s Action – 04/18/22 Close:  

  • Daily Positive Sectors: Energy, Basic Materials of note.
  • Daily Negative Sectors: Healthcare, Consumer Defensive, Real Estate, Utilities, Industrials of note.
  • One Month Winners: Energy, Consumer Defensive, and Utilities of note.
  • Three Month Winners: Energy, Utilities and Basic Materials of note.
  • Six Month Winners: Energy, Basic Materials, Utilities of note.
  • Twelve Month Winners: Energy, Utilities, and Basic Materials of note.
  • Year to Date Winners: Energy, Utilities, and  Basic Materials of note.

Choppy session ends with stocks a touch lower.  UNG was up 5.98% for the day.  TLT closed down 0.50% at $120.15.  Updated 04/18/22 close.

Upcoming Earnings Of Note: (sorted by market cap, highest to lowest with most visible names)

  • Tuesday After the Close: NFLX, IBM, IBKR, OMC, FHN, REXR, WTFC, PACW, HWC, UCBI, FULT, LRN, MRTN of note.
  • Wednesday Before the Open: PG, ASML, ABT, ANTM, BKR, NDAQ, MTB, AA, CMA, MKTX, LAD, GATX, HCSG, HTLD of note.

Earnings of Note This Morning:

  • Beats: SBNY +1.07, TRV +0.60, SI +0.32, LMT +0.25, CFG +0.16, TFC +0.12, JNJ +0.10, CBSH +0.09, MAN +0.09, IRDM +0.02, HAL +0.01.
  • Flat: None of note.
  • Misses: HAS (0.07), FITB (0.01).
  • Still to Report: BMI, PLD.

Guidance:

  • Positive Guidance: FWRD, FLGT, SMCI of note.
  • Negative Guidance: NTGR, NHI of note.

Erlanger Research Advance/Decline Chart: Updated through 04/18/22 close.

Gap Ups & Down In Early Pre-Market:

  • Gap Up: SMCI +12%, GFF +9%, FLGT +7%, ZEN +5%, PLUG +4%.
  • Gap Down: NTGR -11%, ACAD -7%, PNFP -6%.

Insider Action: LQDA sees Insider buying with dumb short selling.  CRNX sees Insider buying with smart short sellers. 04/18/22 close.

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: ZEN NTGR WE ACAD JNJ TRV  (CNBC)
  • Five Things You Need to Know to Start Your Day. (Bloomberg)
  • Russian offensive in Eastern Ukraine has started. (NYT)
  • The battle for Donbas is the major battle of Putin’s War notes Ukrainian lawmaker. (CNN)
  • U.S. Treasury hits 2.91% on the 10 Year early this morning. (CNBC)
  • Delta (DAL) test Starlink on flights for internet service which would hurt GoGo (GOGO). (WSJ)
  • Preview of Netflix (NFLX). Analysts not expecting much. Write off of Russian business expected as company leaves Russia. (NYT)
  • Johnson & Johnson (JNJ) missed revenues and cuts full year outlook. Stock lower. (MarketWatch)
  • Climate change activists are very upset over President Biden decision late Friday to resume oil drilling on public lands. (ABC News)
  • Robinhood Snacks looks at Twitter (TWTR) poison pill. Does it lead to another bidder? Could SiriusXM (SIRI) be hit hard by chip shortage?

Moving Average Update:

  • Score pulls back to 10% from 23%.  Updated 04/18/22 close.

Geopolitical: 

  • President’s Public Schedule:
    • The President receives the President’s Daily Brief, 9:00 a.m. EDT
    • The President convenes a secure video call with allies and partners to discuss our continued support for Ukraine and efforts to hold Russia accountable as part of our close coordination, 9:45 a.m. EDT
    • The President departs the White House en route Joint Base Andrews and Portsmouth, New Hampshire, 11:40 a.m. EDT
    • The President visits the New Hampshire Port Authority at Portsmouth Harbor, which recently completed a project to widen the Harbor’s turning basin, 1:55 p.m. EDT
    • The President delivers remarks on the historic investments in the Bipartisan Infrastructure Law that will Build a Better America and modernize our nation’s ports and waterways, 2:45 p.m. EDT
    • The President departs Portsmouth, New Hampshire en route Joint Base Andrews, 3:30 p.m. EDT
    • The President arrives at the White House, 5:30 p.m. EDT

Economic: 

  • The Peoples Bank of China (PBOC) is out with its latest rate announcement overnight.
  • March Housing Starts are due out at 8:30 a.m. EDT and is expected to fall to 1,750,000 from 1,769,000 last month.
  • Redbook Sales 8:55 a.m. EDT
  • API Crude Oil Data 4:30 p.m. EDT

Federal Reserve Speakers:

  • Federal Reserve Chicago President Charles Evans 12:05 p.m. EDT

M&A Activity:

  • Columbia Financial, Inc. (CLBK) Receives Regulatory Approvals for Acquisition of RSI Bank.
  • Fulgent Genetics (FLGT) to acquire Inform Diagnostics for a total purchase price of approx. $170 million in cash.
  • Griffon (GFF) to sell Telephonics Corporation to TTM Technologies (TTMI) for $330 million in cash.
  • National Bank (NBHC) also announces agreement to acquire Rock Canyon Bank in cash and stock transaction valued at $136.0 million.
  • Zendesk (ZEN) working with Qatalyst on potential sale. (Reuters)

Meeting & Conferences of Note:

  • Sellside Conferences:
    • Noble Capital Markets 18th annual in-person Small & Microcap Investor Conference (NobleCon 18) 2022 (04/19/22-04/21/22)
    • Benzinga Psychedelics & Cannabis Capital Conference 2022 (04/19/22-04/21/22)
      • Previously Announced  Conferences:
        • None of note.
  • Company Meetings: ANGN, DKNG, HPQ, PEG, RENT, RNAZ, SHW, USB, WHR.
  • Fireside Chat: YAYO.
  • Investor/Analyst Day/Calls: HTBX.
  • Update: None of note.
  • R&D Day: None of note.
  • Company Event: None of note.
  • Industry Meetings:
    • CxEnergy 2022 Conference (04/19/22-04/22/22)
    • CableLabs Envision Vendor Forum 2022: Mobility & Wireless in a Converged World (04/19/22-04/20/22)
    • Optics and Photonics International Exhibition (OPIE) 22 (04/19/22-04/22/22)
      • Previously Posted and Ongoing Conferences:
        • World Vaccine Congress 2022 (04/18/22-04/21/22)
        • New York International Auto Show 2022 (04/15/22-04/24/22)

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:

      

Monday’s Upgrades and Downgrades: