CAPIS Morning Note – 06/13/22: A Bad Start To The Week, Stocks Off More Than -2% To Start The Day

Overnight Summary: The S&P 500 closed Friday at 3900.86 (lower by -2.91%) and 4017.82 (lower by -2.38%) on Thursday. Futures have trading lower overnight. The overnight high of 3876.50 was hit at 6:05 p.m. EDT. The low was hit at 3797.50 at 4:20 a.m. EDT, a range of 80.25 points high to low which is…

Overnight Summary: The S&P 500 closed Friday at 3900.86 (lower by -2.91%) and 4017.82 (lower by -2.38%) on Thursday. Futures have trading lower overnight. The overnight high of 3876.50 was hit at 6:05 p.m. EDT. The low was hit at 3797.50 at 4:20 a.m. EDT, a range of 80.25 points high to low which is well above the range of late with 45 the average. At 7:25 a.m. EDT the current price is 3819.50 down -80.50 which is -2.04%.

Earnings Out After The Close:

  • Beats: None of note.
  • Flat: None of note.
  • Misses: None of note.

Capital Raises:

  • IPOs Priced or News: None of note.
  • New SPACs launched/News:
    • Digital World Acquisition (DWAC) filed Form S-4 Which Inlcudes Prelim Proxy Statement Of Co,prospectus On Deal Involving Co & Trump Media & Technology Group.
    • Blue Nile to combine with Mudrick Capital Acquisition Corporation II (MUDS).
  • Secondaries Priced: None of note.
  • Notes Priced of note: None of note.
  • Common Stock filings/Notes:
    • CRGY: Files for 5 million share common stock offering.
    • COGT : Announces Proposed $125 million Public Offering of Common Stock.
    • NLSP: Filed Form F-1.. Up to 3,150,000 Common Shares.
    • OMEX: Closing of $16.5 Million Registered Direct Offering Priced At-The-Market Under Nasdaq Rules.
    • SLRX: Filed Form S-3.. 7,004,578 Shares of Common Stock.
  • Pricing of Over-Allotment/Notes: None of note.
  • Direct Offering: None of note.
  • Selling Shareholders of note:
    • USEG: Files for 19,905,736 share common stock offering by selling shareholders.
  • Private Placement of Public Entity (PIPE): None of note.
  • Mixed Shelf Offerings:
    • APCX: Filed Form S-3.. $75,000,000 Mixed Shelf.
    • EBET: Filed Form S-3 $100 Million mixed Shelf.
  • Convertible Offering & Notes Filed:
    • TRI: Filed Form F-10 .. US$3,000,000,000 Debt Shelf.

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: DBVT 74.4%, MRTX 32.8%, EDU 27.8%, FIXX 22.4%, STIM 21.4%, TAST 20.7%, PDD 18.2%, BABA 17.7%, TAL 17.6%, GTX 17.6%, SQQQ 17.0%, ALLO 17.0%, MG 16.7%, BPT 15.4%.
    • Trading Down: OSUR -28.7%, SFIX -27.4%, CMTL -25.5%, TCMD -25.3%, QTWO -23.6%, PAGS -23.4%, STNE -23.0%, ICPT -22.5%, HRTX -22.3%, DOCU -21.1%, AZUL -20.8%, NVTA -20.7%, AMPH -20.4%, TLRY -19.2%, CUK -19.1%, CO -18.8%, EVLO -18.7%, GOL -18.6%.
  • News Items After the Close:
    • SEC Is Investigating Goldman Sachs (GS) Over ESG Funds. (WSJ)
    • Average US Pump Price Tops $5 a Gallon as Summer Travel Ramps Up. (WSJ)
    • Russian/Ukraine News:
      • see Rags & Mags.
  • News Items Over the Weekend:
    • Stocks that Defined the Week: TGT, TWTR, KSS, ABT, CPB, MSFT, SJM  (WSJ)
    • The Week in Business: Trouble for Tesla? (TSLA).  (NYT)
    • Elon Musk says Tesla (TSLA) had a ‘very tough quarter’ and needs to rally in leaked email.
    • China’s Defense Chief issued one of the country’s strongest warnings yet about the risk of war over Taiwan, even as he reaffirmed Beijing’s commitment to maintain peace in Asia.
    • Cryptocurrency Market Capitalization falls below $1 trillion for first time since January 2021. (Coinmarketcap)
    • Crypto lending service Celsius ‘pauses’ withdrawals & transfers amid ‘extreme market conditions’.
    • US Dollar @ levels not seen since April 2020.
    •  Barron’s:
      • Positive View: GBTG, EOG, RUN PSX, SHEL, LBRT, NVO, LLY, AXP, MAR, LUV.
      • Cautious View: None of note.
      • Mixed View: AAPL.
  • Exchange/Listing/Company Reorg and Personnel News:
    • Deckers Outdoor (DECK) COO David Lafitte to step down.
    • Electric Last Mile Solutions, Inc. (ELMS) Announces Chapter 7 Bankruptcy Filing.
    • Great Panther Mining (GPL) Receives Continued Listing Standards Notice from NYSE American.
    • Mallinckrodt Announces Anticipated Chapter 11 Emergence and Provides Update on Trading of New Ordinary Shares.
    • Photronics (PLAB) files to delay its 10-Q.
    • Romeo Power (RMO) Announces Receipt of Continued Listing Standard Notice from NYSE.
    • TSLA: Larry Ellison will not stand for re-election to the Board; co expects to reduce the number of Board seats to seven.
    • Volta Inc. (VLTA) Board of Directors Announces Executive Leadership Team Additions and Key Promotions.
  • Buyback Announcements:
    • Medpace (MEDP) approves a $50 million increase to its share repurchase program.
  • Stock Splits:
    • TDH Holdings, Inc. (PETZ) Announces 1-for-20 Reverse Stock Split.
    • TSLA: The primary purpose of the Authorized Shares Amendment is to facilitate a 3-for-1 split of our common stock in the form of a stock dividend (the “Stock Split”). As of June 6, 2022, we have 1,036,390,569 shares of common stock outstanding, and the current number of authorized shares of our common stock is 2,000,000,000, which is insufficient to effectuate the Stock Split. Our Board intends to approve the Stock Split, subject to and contingent upon stockholder approval of the Authorized Shares Amendment.
  • Dividends Announcements:
    • Garmin (GRMN) raises dividend to boost yield to nearly 3%. (MarketWatch)
    • Omega Flex (OFLX) increases quarterly dividend to $0.32 per share, a 7% increase.

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

S&P 500 -96, Dow Jones -592, NASDAQ -364, and Russell 2000 -45. Europe lower and Asia lower.  VIX Futures are at 30.80 from 26.70 on Friday morning and the VIX closed at 27.75 from 26.09 on Friday. Gold,  Silver and Copper lower. WTI Crude Oil  and Brent Oil Futures lower and Natural Gas lower. $ is higher vs Euro, higher vs Pound and higher vs Yen. US 10 year Treasury sees yields at 3.255% from 3.038% on Friday morning. Bitcoin is at  $23,652 from $29,995 Friday morning and is lower by -14.10% this morning. As of 8:07 a.m. EDT.

Sector Action – 06/10/22 Close (1/3/6/12/YTD Updated Weekly with Monday release):   

  • Daily Positive Sectors: none of note.
  • Daily Negative Sectors: Technology, Consumer Cyclical, Financial, Industrials, Communication Services, Real Estate, Basic Materials, Energy of note.
  • One Month Winners: Energy, Consumer Cyclical and Basic Materials Utilities of note.
  • Three Month Winners: Energy and Utilities of note.
  • Six Month Winners: Energy, Utilities, and Basic Materials of note.
  • Twelve Month Winners: Energy and Utilities of note.
  • Year to Date Winners: Energy, Utilities, and Basic Materials of note.

CPI print was treated with disdain as all markets pulled back over 2%.  UUP was up 0.80% closing at $27.83  Updated 06/10/22 close.

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

  • Monday After the Close: ORCL of note.
  • Tuesday Before the Open: none of note.

Earnings of Note This Morning:

  • Beats: None of note.
  • Flat: None of note.
  • Misses: None of note.
  • Still to Report: None of note.

Guidance:

  • Positive Guidance: none of note.
  • Negative Guidance: none of note.

Erlanger Research Advance/Decline Chart: Updated through 06/10/22 close.

Gap Ups & Down In Early Pre-Market:

  • Gap Up: DAWN +28%, GRCL +12%, VXX +6%.
  • Gap Down: COGT -16%, DWAC -7%, USEG -6%, CRGY -4%, CVE -4%.

Insider Action:  TELA sees Insider buying with dumb short selling.  ATEC sees Insider buying with smart short sellers. 06/09/22 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: COIN, DOCU, AMZN, MSTR, SI, TSLA, PFE  (CNBC)
  • Five Things You Need to Know to Start Your Day (Bloomberg)
  • Bloomberg Lead Story: U.S. Bonds Flag Recession With 75 Basis Point Move in Play. (Bloomberg)
  • Bloomberg Most Read Story: China warns U.S. privately to avoid Taiwan Straits. (Bloomberg)
  • Shanghai reimposes ban on indoor dining as Covid-19 cases rise. (Bloomberg)
  • Japan concerned about the falling Yen and ready to act if needed. (Reuters)
  • Russian making progress towards control of eastern Ukraine. (NYT)
  • Former U.S. Treasury Secretary Larry Summers says a U.S. recession likely within two years. (Axios)
  • Former PIMCO Head Mohamed El-Erian says inflation may hit 9%. (Bloomberg)
  • Democrats do not want President Biden to announce a run in 2024 and want him to announce he is not doing so before Midterms. (NYT)
  • Bitcoin falls -14% over weekend, now under $24,000. (CNBC)
  • Biden Administration to shift $10 billion from Covid testing to vaccines and treatments. (The Washington Post)
  • Jurassic Park: Dominion brings in $143 million. (CNBC)
  • Google (GOOGL) to pay $118 million fine to settle lawsuit on underpaid females. (FT)

Moving Average Update:

  • Score hard ZERO!  Updated 06/10/22 close.

Geopolitical: 

  • President’s Public Schedule:
    • The President departs Wilmington, Delaware en route the White House, 11:10 a.m. EDT
    • The President arrives at the White House, 12:05 p.m. EDT
    • The President signs into law .R. 3525, the “Commission To Study the Potential Creation of a National Museum of Asian Pacific American History and Culture Act”; The Vice President attends, 2:00 p.m. EDT
    • Press Briefing by Press Secretary Karine Jean-Pierre, 3:00 p.m. EDT

Economic: 

  • None of note.

Federal Reserve / Treasury Speakers:

  • Federal Research Board of Governors Lael Brainard pre recorded video on Community Reinvestment Act 2:00 p.m. EDT.

M&A Activity:

  • Choice Hotels (CHH) acquires Radisson Hotel Group Americas for $675 million.
  • Pinterest (PINS) Completes Acquisition of THE YES.
  • Piper Sandler (PIPR) Completes the Acquisition of Stamford Partners LLP, Forming European Consumer Team
  • Clearlake Capital-Backed Cornerstone Enters Definitive Agreement to Acquire SumTotal, a Skillsoft Company (SKIL), for a sum total of $200 million.
  • Uranium Energy Corp (UEC) Announces Acquisition of UEX Corporation to Create the Largest Diversified North American Focused Uranium Company.

Meeting & Conferences of Note:

  • Sellside Conferences:
    • Bank of America Clean Energy: Mid-Year Conference 2022
    • Barclays Virtual Software Bus Tour 2022
    • Deutsche Bank Global Auto Industry Conference
    • Goldman Sachs 43nd Annual Global Healthcare Conference 2022 (06/13/22-06/16/22)
    • HSBC 6th Annual Asia Credit Conference 2022 (06/13/22-06/24/22)
    • Mizuho 4th Annual Cybersecurity Summit 2022
    • Morgan Stanley 13th Annual US Financials Payments & CRE Conference 2022 (06/13/22-06/15/22)
    • SEMICON West
    • Wells Fargo Streaming & Connectivity Conference 2022 (06/13/22-06/14/22)
      • Previously posted and ongoing conferences:
        • Barclays European Internet & Emerging Tech / FinTech Conference (06/10/22-06/14/22)
  • Company Meetings: BTTR, GM.
  • Fireside Chat: None of note.
  • Investor/Analyst Day/Calls: AUTL, ING, IPSC, NPTN, NYT, NVTS.
  • Update:
    • Gracell Biotechnologies Inc. (GRCL) Schedules Clinical Update Call 2022.
    • Apollo Global Management Inc (APO) Retirement Services Business Update.
    • bridgebio pharma (BBIO) to discuss phase 2b data and phase 3 trial design for encaleret in adh1.
    • TeraWulf (WULF) Business Update Call.
  • R&D Day: None of note.
  • Company Event:
    • Cisco (CSCO) Live 2022 (06/12/22-06/15/22)
    • Pega (PEGA) World iNspire Conference 2021 (06/12/22-06/14/22)
    • Verint (VRNT)Engage Customer Engagement Conference 2022 (06/13/22-06/16/22)
  • Industry Meetings:
    • 12th International Advanced Automotive Battery Conference (AABC) Europe 2022 (06/13/22-06/15/22)
    • Biotechnology Innovation Organization (BIO) International Convention 2022 (06/13/22-06/16/22)
    • Prospectors & Developers Association of Canada (PDAC) Mining International Trade Show & Conference (In Person) 2022 (06/13/22-06/15/22)
      • Previously posted and ongoing conferences:
        • American Society of Echocardiography 33rd Annual Scientific Sessions (06/10/22-06/13/22)
        • 13th International Congress on Autoimmunity 2022 (06/10/22-06/13/22)
        • Endocrine Society Annual Meeting ENDO 2022 (06/11/22-06/14/22)
        • The 20th International Symposium on Pediatric Neuro-Oncology (ISPNO) Annual Meeting 2022 (06/11/22-06/15/22)
        • Society of Nuclear Medicine and Molecular Imaging (SNMMI) Annual Meeting 2022 (06/11/22-06/14/22)
        • Society for Human Resource Management (SHRM) Annual Conference & Expo 2022 (06/11/22-06/15/22)
        • Vaccine Technology VIII: An Engineering Conferences International (ECI) Conference Series 2022 (06/11/22-06/17/22)
        • American Microbiology Society (ASM) Microbe 2022 (06/09/22-06/13/22)

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:

Previous Day’s Upgrades and Downgrades: