CAPIS Morning Note – 06/23/22: Stocks Higher After Wild Overnight Session. Europe and Asia Took The Lead As Both Higher Ex Germany.

Overnight Summary: The S&P 500 closed Wednesday at 3759.89 (lower by -0.13%) and Tuesday at 3764.79 (higher by 2.45%).  Futures are trading higher now after a volatile overnight session. The overnight high of 3793.5 was hit at 7:00 a.m. EDT. The low was hit at 3735 at 3:40 a.m. EDT, a range of 58 points…

Overnight Summary: The S&P 500 closed Wednesday at 3759.89 (lower by -0.13%) and Tuesday at 3764.79 (higher by 2.45%).  Futures are trading higher now after a volatile overnight session. The overnight high of 3793.5 was hit at 7:00 a.m. EDT. The low was hit at 3735 at 3:40 a.m. EDT, a range of 58 points high to low which is a bit above the range of late with 45 the average range. At 7:20 a.m. EDT the current price is 3787.75 which is 0.66% and +25 points.

Earnings Out After The Close:

  • Beats: WOR +0.75, KBH +0.29, SCS +0.13, FUL +0.04.
  • Flat: None of note.
  • Misses: None of note.

Capital Raises:

  • IPOs Priced or News: None of note.
  • New SPACs launched/News: None of note.
  • Secondaries Priced:
    • APLT: $1 per share pricing with warrants for $30 million Public Offering.
    • XENE: prices $250M offering. 7.86M shares at $30.50/share.
  • Notes Priced of note:
    • ORA: Announces Pricing of Upsized $375 Million Offering of Green Convertible Senior Notes.
    • TRGP: Prices $1.25 Billion Offering of Senior Notes.
  • Common Stock filings/Notes:
    • APLT: Public Offering of Common Stock and Warrants.. SVB Bookmanager.
    • BLUE: Form 8K.. Equity Distribution Agreement up to $75 Million Common Stock with GS.
    • PALI: Filed Form S-1.. Class A Units consisting of shares of common stock and warrants.
    • PVL: Filed Form S-3.. 8,600,000 Trust Units.
    • RMTI: Filed Form S-1.. 11,168,887 Shares of Common Stock.
    • SMMT: Announces $100 Million Rights Offering.
    • STRM: Filed Form S-3.. 272,653 Shares Common Stock.
    • XENE: Proposed Public Offering.. Jefferies, JPM, SVB and Stifel bookmanager.
  • Pricing of Over-Allotment/Notes: None of note.
  • Direct Offering: None of note.
  • Selling Shareholders of note: None of note.
  • Private Placement of Public Entity (PIPE): None of note.
  • Mixed Shelf Offerings: None of note.
  • Convertible Offering & Notes Filed:
    • MOMO: Announces Repurchase of Convertible Notes.

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: AURA +7%, SCS +4%, WOR +4%.
    • Trading Down: None of note.
  • News Since The Close:
    • Juul Ban Will Send Altria’s (MO) Strategy, and $13 Billion, Up in Smoke. (WSJ)
    • API data reportedly show a hefty weekly climb in U.S. crude supplies; EIA delays oil data release. (MarketWatch)
    • CEO Elon Musk says Tesla’s (TSLA) two newest car plants are losing billions of dollars. (AutomotiveNews)
    • Tesla (TSLA) China begins laying off 10% of staff, not involving manufacturing employees: Sina Tech cites people familiar.
    • Revlon (REV) Stock Surges After Bankruptcy Filing, Aided by Individual Investors. (WSJ)
    • U.S. to authorize commercial labs to conduct monkeypox tests. (WAPO)
    • Century Aluminum (CENX) to Temporarily Idle Its Hawesville Smelter Due to Soaring Energy Prices; Issues WARN Notice to Employees.
    • Spire Global (SPIR) Awarded $6 Million NASA Contract Extension for Earth Observation Data.
  • Exchange/Listing/Company Reorg and Personnel News:
    • AMD Appoints Mathew Hein as Chief Strategy Officer.
    • Enphase Energy (ENPH) COO Jeff McNeil intends to retire next year.
    • INTC: Scott Gawel has been appointed as Corporate Vice President and Chief Accounting Officer effective 07/06/22.  Mr. Gawel previously was employed at Oracle.
    • Lakeland Industries (LAKE) announced that Christopher J. Ryan, Executive Chairman of the Board, intends to step down from his role in 2023.
    • Red Robin (RRGB) Gourmet CEO Paul Murphy intends to retire at the end of 2022.
    • Wheels Up (UP) names Todd Smith Chief Financial Officer.
  • Buyback Announcements:
    • APOG: increased the existing share repurchase authorization by 1 million shares.
    • Darden Restaurants (DRI) Authorizes New $1 Billion Share Repurchase Program.
    • GMS: The Company’s Board of Directors has approved an expanded share repurchase program under which the Company is authorized to repurchase up to $200 million of its outstanding common stock.
  • Stock Splits:  None of note.
  • Dividends Announcements:
    • China Yuchai International (CYD) to Pay US$0.40 Per Share Cash Dividend for FY2021.
    • Darden Restaurants (DRI) Increases Quarterly Dividend.
    • Matson (MATX) declared a third quarter dividend of $0.31 per common share. The dividend represents a $0.01, or 3.3%, increase over the previous quarter’s dividend.

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

S&P 500 +27, Dow Jones +164, NASDAQ +117, and Russell 2000 +11. Europe higher ex Germany which is lower by -0.40% and Asia higher.  VIX Futures are at 28.75 from 30.91 yesterday morning and the VIX closed at 28.95 from 30.19  yesterday. 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 lower vs Yen. US 10 year Treasury sees yields at 3.13% from 3.196% yesterday morning. Bitcoin is at $20,661.25 from $20,451 yesterday morning and is higher by 2.99% this morning. As of 8:09 a.m. EDT.

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

  • Daily Positive Sectors: Healthcare, Utilities, Real Estate of note.
  • Daily Negative Sectors: Energy, Basic Materials, Technology of note.
  • One Month Winners: none of note.
  • Three Month Winners: none of note.
  • Six Month Winners: Energy of note.
  • Twelve Month Winners: Energy of note.
  • Year to Date Winners: Energy of note.

Federal Reserve Chair Jerome Powell moved the markets.  Stating that the central bank is committed to the inflation fight, the drumbeat of a recession beat a little louder bringing rates down.  TLT was up 2.73% to close at $113.19 and all indexes closed a touch in the red recovering from opening prints.  Updated 06/22/22 close.

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

  • Thursday After the Close: FDX, AVAV, SWBI, CAMP of note.
  • Friday Before the Open: KMX of note.

Earnings of Note This Morning:

  • Beats: FDS +0.54, APOG +0.44, GMS +0.21, RAD +0.10, DRI +0.03.
  • Flat: None of note.
  • Misses: ACN (0.04).
  • Still to Report: None of note.

Guidance:

  • Positive Guidance: CHEF, APOG, RAD  of note.
  • Negative Guidance: ACN, DRI of note.

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

Gap Ups & Down In Early Pre-Market:

  • Gap Up: AURA +10%, APOG +5%, KBH +5%, SPIR +4%.
  • Gap Down: XENE -10%, RRGB -5%.

Insider Action: TELA, PINE, LAZY, APG, OXY sees Insider buying with dumb short selling. No stock sees Insider buying with smart short sellers. 06/22/22 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: ACN DRI FDS RAD KBH OXY (CNBC)
  • Five Things You Need to Know to Start Your Day (Bloomberg)
  • Bloomberg Lead Story: Bond yields drop as recession fears rise. (Bloomberg)
  • Bloomberg Most Read Story: Juul ordered off the market by FDA (Bloomberg)
  • Russia close to complete takeover of Luhansk province. (NYT)
  • China reaffirms their growth targets. (Bloomberg)
  • U.S. to expand Monkeypox testing. (Bloomberg)
  • As noted yesterday, Oil executives meet with Energy Secretary Jennifer Granholm. (The Hill)
  • SEC to create new rules on the gaming features of online brokers like Robinhood(HOOD). (Bloomberg)
  • Bridgewater increases bet against Europe to $10.5 billion, doubling bet. (Bloomberg)
  • BMW (BMWYY) to open a EV plant in China. (WSJ)
  • American Airlines (AAL) to cut service to 4 smaller cities due to pilot shortage. (CNBC)
  • Robinhood Snacks looks at the demise of Juul and hit Altria (MO) will take. Twitter (TWTR) and Shopify (SHOP) team up to expand social shopping.

Moving Average Update:

  • Score remains at 17% battling back from the morning plunge.  Kudos to you Mr. Market!  Updated 06/22/22 close.

Geopolitical: 

  • President’s Public Schedule:
    • The President and The First Lady welcome wounded warriors, their caregivers and families to the White House as part of the annual Soldier Ride to recognize the service, sacrifice, and recovery journey for wounded, ill, and injured service members and veterans; The Vice President and The Second Gentleman attend, 9:00 a.m. EDT
    • The President receives the President’s Daily Brief, 10:30 a.m. EDT
    • Press Briefing by White House COVID-19 Response Team and public health officials, 2:15 p.m. EDT
    • Press Briefing by Press Secretary Karine Jean-Pierre, 3:10 p.m. EDT

Economic: 

  • Initial Jobless Claims 8:30 a.m. EDT 
  • Current Accounts 8:30 a.m. EDT 
  • PMI Composite Flash 9:45 a.m. EDT
  • EIA Natural Gas Report 10:30 a.m. EDT Possible delay – (See above news since the close Market Watch story)
  • EIA Petroleum Report 11:00 a.m. EDT Possible delay 
  • KC Fed Mfg Index 11:00 a.m. EDT

Federal Reserve / Treasury Speakers:

  • Federal Reserve Chairman Powell begins day two of his Humphrey Hawkins Testimony before the House. 10 a.m. EDT

M&A Activity:

  • Atkore Inc. (ATKR) Announces Acquisition of United Poly Systems.

Meeting & Conferences of Note:

  • Sellside Conferences:
    • Bank of America Securities Boston Marketing 2022
    • Bank of America C-Suite TMT Conference 2022
    • Bank of America Web3 & Digital Assets Day 2022
    • Diamond Equity Research 2022 Emerging Growth Invitational Conference 2022
    • JP Morgan European Healthcare Conference 2022
    • Maxim Group Digital Assets: Exploring The Metaverse And Crypto Assets
    • RBC Canadian Private Technology Conference
    • Wells Fargo Electric Vehicle Mini Conference 2022
    • Wolfe Research June Consumer Conference
      • Previously posted and ongoing conferences:
        • 3 Part Advisors East Coast IDEAS Investor Conference 2022 (06/22/22-06/23/22)
        • Cowen 7th Annual FutureHealth Conference 2022 (06/22/22-06/23/22)
        • Credit Suisse Biotech Conference
        • Fox Advisors Transportation Technology Conference 2022 (06/22/22-06/23/22)
        • Goldman Sachs Summer Digital Asset Conference
        • HSBC Global Digital Finance Forum 2022 (06/20/22-06/30/22)
        • HSBC 6th Annual Asia Credit Conference 2022 (06/13/22-06/24/22)
        • JP Morgan Energy, Power & Renewables Conference 2022 (06/22/22-06/23/22)
        • Piper Sandler Global Exchange & FinTech Virtual Event 2022 (06/20/22-06/23/22)
        • ROTH 8th Annual London Conference 2022 (06/21/22-06/23/22)
        • Stifel Growth Conference 2022 (06/22/22-06/23/22)
        • UBS Latam Conference
  • Company Meetings: HOTH, IAC, KSCP, TEVA, VC.
  • Fireside Chat: RDHL, SES.
  • Investor/Analyst Day/Calls: CMCO, DVA, ENS, G, GEF, HUM, IDEX, MAR, MODV, PYPD.
  • Update: IDEX.
  • R&D Day: None of note.
  • Company Event:
    • Cisco (CSCO) and J.P. Morgan (JPM) to Host a Tech Talk on Hybrid Work 2022
    • HTG Molecular Diagnostics, Inc. (HTGM) Scientific Webinar: Customer Use of the HTG Transcriptome Panel in Preclinical and Clinical Programs
    • PolyPid Ltd. (PYPD) Key Opinion Leader (KOL) Webinar on Managing the Cost of Surgical Site Infections 2022
  • Industry Meetings:
    • New Jersey Defense Association (NJDA) 56th Annual Convention
    • The Extracellular Matrix Pharmacology Congress (ECM) 2022 (06/23/22-06/25/22)
    • Life Sciences Investor Forum 2022
    • NPC Patient and Family Conference 2022 (06/23/22-06/24/22)
      • Previously posted and ongoing conferences:
        • EASL International Liver Congress 2022 (06/22/22-06/26/22)
        • American Bankers Association’s Regulatory Compliance Conference 2022 (06/21/22-06/24/22)
        • International Microwave Symposium (IMS) 2022 (06/19/22-06/24/22)
        • Drug Information Association (DIA) Global Annual Meeting (06/19/22-06/23/22)
        • European Association for Cancer Research(EACR) Congress 2022 (06/20/22-06/23/22)
        • ChemCon Europe 2022 (06/20/22-06/24/22)
        • Customer Contact Week Las Vegas 2022 (06/20/22-06/23/22)
        • Connect IT Global Las Vegas 2022 (06/20/22-06/23/22)

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: