Overnight Summary: The S&P 500 closed Friday at 4169.48 higher by 0.83% while Thursday closed at 4135.35 higher by 1.96%. The overnight high of 4196 was hit at 2:45 a.m. EDT. The low was hit at 4184.75 at 4:35 p.m. EDT, a range of ~12 points high to low which is well below the recent range of 45. At 7:25 a.m. EDT, the current price was 4187.50 which is -0.02% and -1 points. The overnight session was amazingly narrow. A real head-scratcher.
Earnings Out After The Close:
- Beats: None of note.
- Flat: None of note.
- Misses: None of note.
Unusual Options Activity:
Daily Screen in Erlanger Chartroom that highlights unusual Call and Put Options activity in the S&P 500. 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:
- J&J’s (JNJ) Kenvue spinoff a rare IPO winner in moribund market. (Barron’s)
- New SPACs launched/News:
- Above Food Corp., a Vertically Integrated Specialty Ingredients and Food Company, to List on NYSE Through Business Combination with Bite Acquisition Corp. (BITE)
- Akerna (KERN) Announces Sale of Software Business to MJ Freeway Acquisition Co, Coinciding with Merger with Gryphon Digital Mining.
- Mobiv Acquisition Corp (MOBV) Announces Extension of Deadline to Complete Business Combination.
- Secondaries Priced:
- YCBD Filed Form 424B5 — Priced at $2.10 for $2.8M public offering.
- Notes Priced of note: None of note.
- Common Stock filings/Notes:
- NE: Announces changes to its share capital.
- PHIO: Filed Form S-1.. Up to 734,515 Shares of Common Stock.
- WISA: Filed Form S-1.. Up to 3,160,546 Shares of Common Stock Issuable Upon Exercise of Certain Common Stock Purchase Warrants.
- Direct Offering: None of note.
- Selling Shareholders of note: None of note.
- Private Placement of Public Entity (PIPE): None of note.
- Mixed Shelf Offerings:
- ALPN: Files for $400 million mixed securities shelf offering.
- EBON: Filed Form F-3.. $75 Million Mixed Shelf.
- JSPR: Filed Form S-3.. $250,000,000 Mixed Shelf.
- SBSI: Files mixed securities shelf offering.
- SFL: Files mixed securities shelf offering.
- UNM: Files mixed securities shelf offering.
- Debt/Credit Filing and Notes:
- ELDN: Announces up to $185 Million Financing to Advance Tegoprubart Kidney Transplantation Clinical Trials.
- FGEN: Announces Non-Dilutive Term Loan Financing for up to $150 Million with Morgan Stanley Tactical Value.
- GOGO: Announces $100 Million Debt Prepayment.
- META: Files for Debt Shelf.
- NXE: Receives Strong Support for Rook I Project Financing in Excess of US$1 Billion.
- Tender Offer: None of note.
- Convertible Offering & Notes Filed:
- CMS Energy (CMS) Announces Proposed Offering of $650 Million of Convertible Senior Notes Due 2028.
- FE: Announces Proposed Offering of $1.0 Billion of Convertible Senior Notes Due 2026.
- UHG: Filed Form S-1.. Secondary Offering of Up to 21,544,588 Class A Common Shares $80,000,000 Senior Convertible Promissory 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 and Over the Week:
- Weekly Wrap Up: Best and Worst performing large cap stocks:
- Trading Up: AAN 31.6%, BLUE 28.1%, IMGN 24.8%, BZH 23.9%, CSTE 21.2%, RGS 20.2%, CPS 20.0%, TBBK 19.3%, NYCB 19.2%, URGN 17.0%, UXIN 17.0%, SKYW 16.4%, AMRX 16.3%, HUBB 16.1%, HELE 15.7%, RCII 15.5%.
- Trading Down: FRC -74.3%, HMST -44.3%, PI -37.1%, EHTH -30.1%, ADUS -27.2%, ENPH -27.1%, AZPN -24.5%, MXL -23.2%, UVE -22.7%, CREE -22.2%, AYX -21.1%, TENB -20.8%, NTGR -20.2%, SFIX -19.0%, AMPH -18.3%, .
- News Items After the Close:
- FDIC Prepares To Place First Republic Bank (FRC) Into Receivership Imminently – (Reuters)
- Bed Bath & Beyond (BBBY) requests withdrawal of filing for share offering. (MarketWatch)
- North Korea Says Will Continue to Strengthen Nuclear Deterrent. (Kcna)
- Lockheed Martin (LMT) Gets $7.8 Billion F-35 Order, Finishing a $30 Billion Contract.
- Lockheed Martin (LMT) awarded a $616 million modification to a US Army contract for production of High Mobility Artillery Rocket Systems.
- Parker-Hannifin (PH) awarded a $221.5 million US Army contract for maintenance and overhaul of helicopter servos.
- News Items Over the Weekend:
- Stocks that Defined the Week: FRC, BBBY, META, GPS, GM, XOM (WSJ)
- The Week in Business: High-Profile Media Ousters (NYT)
- How the Fed could cause a stock-market crash — and how to play it safe. (MarketWatch)
- The Bear Market’s Survivors Share Their Biggest Lessons. (WSJ)
- Charlie Munger reportedly warns of trouble for the U.S. commercial property market. (CNBC)
- “.. market breadth has contracted to one standard deviation below average for the first time since 2020. .. Following 9 sharp declines of a similar magnitude since 1980, the $SPX has posted below-average subsequent returns and larger peak-to-trough drawdowns ..”(CARL Q CNBC)
- First Republic Bank (FRC) Progression of bidding/news:
- PNC Financial (PNC) reportedly has the inside track to acquire First Republic Bank (FRC) beating out names like JPMorgan (JPM) and BAC. (Fox Business Gasparino)
- JPMorgan (JPM) highest bidder so far for First Republic (FRC). (Washington Post)
- First Republic Bank (FRC) Is Seized, Sold to JPMorgan (JPM) in Second-Largest U.S. Bank Failure. (WSJ)
- JPMorgan (JPM): The FDIC will provide $50 billion 5-yr fixed-rate term financing. We will make a payment of $10.6 billion to the FDIC.
- Positive View: TJX, JNJ, KVUE, V, KO, CAT, ADBE, HUM, ATVI of note.
- Cautious View: TSLA of note.
- Mixed View: None of note.
- Erlanger Type 1 Short Squeezes and Type 4 Long Squeezes reporting earnings this week:
- Exchange/Listing/Company Reorg and Personnel News:
- From The Nasdaq Stock Market: Delisting of Securities of Pingtan Marine Enterprise Ltd.; SRAX, Inc.; SVB Financial Group; Signature Bank; Codiak BioSciences, Inc.; PLx Pharma Inc.; Virgin Orbit Holdings, Inc.; Kalera Public Limited Company; Pear Therapeutics, Inc.; and Intelligent Medicine Acquisition Corp. (MarketWatch)
- AVROBIO (AVRO) Announces Leadership Transition.
- ARRIVAL (ARVL) Regains Compliance with Nasdaq Minimum Bid Price Requirement.
- Avalon Holdings (AWX) CFO Saksa resigns.
- Biophytis (BPTS) Announces Receipt of Nasdaq Notice.
- Bitfarms (BITF) Regains Compliance with Nasdaq Continued Listing Requirements.
- Cenntro Electric Group (CENN) Announces Receipt of Notice from Nasdaq Regarding Late Filing of Annual Report on Form 10-K.
- Equity Bancshares, Inc. (EQBK) Announces Resignation of Greg Kossover from Executive Management.
- FAT Brands (FAT) Announces Ken Kuick and Rob Rosen as Co-CEOs.
- fuboTV (FUBO) names Alberto Horihuela as COO.
- Global Payments (GPN) Announces CEO Succession Plan.
- HYZON MOTORS (HYZN) Announces appointment of CEO Parker Meeks to Board of Directors.
- Innoviva (INVA) Chairman to retire.
- JX Luxventure Limited (JXJT) Receives Nasdaq Delisting Notice for Failing to Maintain a $1.00 Share Price and Requested and Granted a Hearing Scheduled for May 25, 2023.
- Kaixin Auto Holdings (KXIN) Announces Appointment of New Auditor.
- MAG Silver (MAG) Strengthens Management Team.
- Magnachip (MX) Announces CFO Maternity Leave.
- Maris-Tech (MTEK) Announces Receipt of Nasdaq Minimum Bid Price Notification.
- Recon (RCON) Receives NASDAQ Notification Regarding Minimum Bid Requirements.
- Semler Scientific (SMLR) Names Doug Murphy-Chutorian, M.D. as Interim CEO.
- Turtle Beach (HEAR) Announces CEO Transition Plan and Governance Actions.
- Buyback Announcements or News: None of note.
- Stock Splits or News: None of note.
- Dividends Announcements or News:
- Delek Logistics Partners (DKL) increases quarterly cash distribution by 0.5% to $1.025 per unit.
What’s Happening This Morning: Futures value reflects the change with fair value.
S&P 500 -4, Dow Jones -13, NASDAQ -17, and Russell 2000 -6. (as of 7:59 a.m. EDT). Asia higher and Europe higher. VIX Futures are at 18.47 from 19.90 yesterday. Gold lower, Silver higher with Copper lower. WTI Crude Oil and Brent Crude Oil lower with Natural Gas lower. US 10-year Treasury sees yields at 3.458% from 3.48% on Friday. The U.S. Dollar is higher versus the Euro, higher versus the Pound and higher against the Yen. Bitcoin is at $28,531 from $29,311 on Friday, lower by -2.87%.
Sector Action – (1/3/6/12/YTD Updated Weekly with Monday release):
- Daily Positive Sectors: Energy, Real Estate, Industrials, Financials, Technology, Basic Materials of note.
- Daily Negative Sectors: Utilities of note.
- One Month Winners: Communication Services,
Utilities, Healthcare, Energy Consumer Defensive of note.
- Three Month Winners: Technology, Communication Services, Consumer Defensive of note.
- Six Month Winners: Technology, Communication Services, Basic Materials,
Industrial of note.
- Twelve Month Winners: Energy, Industrials of note.
- Year to Date Winners: Communication Services, Technology, Consumer Cyclical of note.
U.S. stocks ended April higher on Friday, with the Dow Jones Industrial Average booking its best monthly gain since January. Despite renewed focus on stress in the U.S. banking system, major stock indexes were able to post gains on Friday to end the week and month on higher ground, in part as earnings reports from several big technology companies, including Meta Platforms Inc. META, +0.74% were received positively by investors. The Dow rose about 272 points Friday, or 0.8%, ending near 34,098. The S&P 500 index posted a 0.8% gain, while the Nasdaq Composite Index advanced 0.7%. Volatility in the stock market has remained in check, even as First Republic Bank FRC, -43.30% has been exploring talks with multiple partners about strategic options, including potentially asset sales, as its stock price has retreated by about 97% on the year through Friday. For the week, the Dow gained 0.9% and 2.5% for the month, its highest percentage gain in a month since January. The S&P 500 rose 0.9% for the week and 1.5% in April, while the Nasdaq gained 1.3% for the week and ended the month nearly unchanged. (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)
Earnings of Note This Morning:
- Beats: AMG +0.21, NCLH +0.13, KBR +0.09, PK +0.09, CHKP +0.07, TGTX +0.07, GPN +0.09, SOFI +0.04, WEC +0.03 of note.
- Flat: None of note.
- Misses: CNA (0.03) of note.
- Still to Report: BEN, ON of note.
- Positive Guidance: RCMT, GPN, SOFI of note.
- Negative Guidance: None of note.
Erlanger Research Advance/Decline Chart:
Gap Ups & Down In Early Pre-Market:
- Gap Up: ISEE +17.8%, EHTH +11.7%, GATO +10.6% of note.
- Gap Down: FRC -46%, MANU -9% of note.
Insider Action: PII, SCWX 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.
- 5 things to know before the stock market opens. (CNBC)
- 5 Things You Need to Know to Start Your Day. (Bloomberg)
- Bloomberg Lead Story: JP Morgan to Acquire Failed Regional Bank First Republic. (Bloomberg)
- Bloomberg Second Most Shared Story: Bitcoin on Course For Longest Streak of Monthly Gains Since 2021. (Bloomberg)
- US Futures Steady, JP Morgan Wins On First Republic: Market Wrap. (Bloomberg)
- Morgan Stanley’s Wilson Says Hawkish Fed Could Dampen Stock Rally. (Bloomberg)
- What UPS tells us about the economy. (Fox Business)
Moving Average Update:
- Score rises to 85% from 71%.
- President’s Public Schedule:
- The President receives the Presidential Daily Briefing, 9:00 a.m. EDT
- The President and The Vice President deliver remarks during National Small Business Week;, 12:00 p.m. EDT
- The President AND The First Lady welcome His Excellency Ferdinand R. Marcos Jr. President of the Republic of the Philippines and Mrs. Louise Araneta-Marcos to the White House, 2:30 p.m. EDT
- The President holds a bilateral meeting with His Excellency Ferdinand R. Marcos Jr. President of the Republic of the Philippines, 2:45 p.m. EDT
- Press Briefing by Press Secretary Karine Jean-Pierre, 3:00 p.m. EDT
- The President hosts a reception celebrating Eid-al-Fitr; The Vice President and The Second Gentleman attend, 5:30 p.m. EDT
- PMI Mfg Final 9:45 a.m. EDT
- ISM Mfg Index 10:00 a.m. EDT
- Construction Spending 10:00 a.m. EDT
Federal Reserve / Treasury Speakers: None of note.
- IVERIC bio (ISEE) to be acquired by Astellas for $40 per share in cash.
- Reliance Steel & Aluminum Co. (RS) Acquires Southern Steel Supply, LLC
Meeting & Conferences of Note:
- Company Meetings: AFL, LLY, VSAC
- Fireside Chat: None of note.
- Investor/Analyst Day/Calls: ACRV
- Update: None of note.
- R&D Day: None of note.
- Company Event:
- TriNet (TNET) Second Annual Small Business Week Virtual Summit 2023. (05/01/23-05/04/23)
- 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: