CAPIS Morning Note – 07/05/22: Stocks Start New Week With Pre-Market Lower But Off Morning Lows

Overnight Summary: The S&P 500 closed Friday at 3825.33 (higher by 1.06%) from 3785 (lower by -0.88%) on Thursday.  Futures are trading lower in the premarket session but off the lows. The overnight high of 3857.75 was hit at 7:10 p.m. EDT. The low was hit at 3800 at 5:35 a.m. EDT, a range of…

Overnight Summary: The S&P 500 closed Friday at 3825.33 (higher by 1.06%) from 3785 (lower by -0.88%) on Thursday.  Futures are trading lower in the premarket session but off the lows. The overnight high of 3857.75 was hit at 7:10 p.m. EDT. The low was hit at 3800 at 5:35 a.m. EDT, a range of 58 points high to low which is slightly above the range of late with 45 the average range. At 7:20 a.m. EDT the current price is 3816.93 which is -0.43% and -16.50 points.

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: None of note.
  • Secondaries Priced: None of note.
  • Notes Priced of note: None of note.
  • Common Stock filings/Notes:
    • CRTD: Filed Form S-3.. 6,000,000 Shares of Common Stock.
    • DRIO: Filed Form S-3.. UP TO 226,586 SHARES OF COMMON STOCK.
    • ESTE: Filed Form S-3.. 19,417,476 Shares of Class A common stock.
    • JAKK: Files for 2 million share common stock offering.
    • ONDS: Filed Form S-3.. 780,000 Common Stock.
    • SBIG: Filed Form S-1.. 4,510,940 Common Shares.
    • TMBR: Filed Form S-1.. Common Stock Offering.
  • Pricing of Over-Allotment/Notes: None of note.
  • Direct Offering: None of note.
  • Selling Shareholders of note:
    • TOPS: Filed Form F-1.. 14,303,000 Common Shares Issuable upon Exercise of Warrants Offered by the Selling Shareholders.
  • Private Placement of Public Entity (PIPE):
    • STAF: $4 Million Private Placement Priced At-The-Market Under Nasdaq Rules.
  • Mixed Shelf Offerings:
    • ABOS: Filed Form S-3.. $200,000,000 Mixed Shelf.
    • ATAI: Filed Form S-3.. $300 Million Mixed Shelf.
    • CVM: Filed Form S-3.. $150 Million Mixed Security shelf.
    • CHPT: Filed Form S-3.. $1,000,000,000 Mixed Shelf.
    • CNTA: Filed Form S-3.. $350 Million Mixed Shelf.
    • ELEV: Filed Form S-3.. $250 Million Mixed Shelf on that Cowen headlines symbols — TD COWN.
    • FEMY: Filed Form S-3.. $150,000,000 Mixed Shelf.
    • GLUE: Filed Form S-3.. $300,000,000 Mixed Shelf.
    • GRVI: Filed Form S-3.. $30,000,000 Mixed Shelf.
    • IPSC: Filed Form S-3.. $500 Million Mixed Shelf.
    • ISPC: Filed Form S-3.. $100,000,000 Mixed Shelf.
    • MIRO: Filed Form S-3.. $200 Million Mixed Shelf Offering.
    • NEGG: Filed Form F-3.. $300,000,000 Mixed Shelf 60 Million Additional Common Shares.
    • OPI: Filed Form S-3ASR.. Mixed Security Shelf.
    • PNT: Filed Form S-3.. $400,000,000 Mixed Shelf.
    • SYTA: Filed Form F-3.. $100 Million Mixed Security Shelf.
    • TKNO: Filed Form S-3.. $225,000,000 Mixed Shelf.
    • VERV: Filed Form S-3.. $400,000,000 Mixed Shelf.
  • Convertible Offering & Notes Filed:
    • QD: Completes the Optional Repurchase of 1.00% Convertible Senior Notes due 2026.

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: TOUR 128%, OMER 62%, EPZM 55%, CLVS 55%, KZR 53%, RFP 20%, RIGL 20%, TWOU 19%, IVR 15%, QD 14%, ATRA 14%, FTDR 13%, SQQQ 13%, LRN 12%, AMPH 11%, ORA 11%.
    • Trading Down: BBBY -33%, GRPN -30%, CVNA -30%, AVYA -27%, KSS -26%, CGC -25%, AXDX -24%, AMRN -23%, SGH -23%, FTCH -23%, OSTK -22%, VAPO -22%, RAD -21%, PACB -21%, HRTX -21%, SFIX -21%, GRUB -20%, TRHC -20%, ASX -20%, DDS -19%.
  • News Items After the Close:
    • President Biden Seeks to Block New Offshore Drilling in Atlantic, Pacific. (WSJ)
    • Lockheed Martin (LMT) awarded a $192 million US Navy contract modification related to Australia Surface Combatant program.
    • Northrop Grumman (NOC) awarded a $338 million US Navy contract related to H-1 avionics and weapons.
  • News Items Over the Weekend:
    • Stocks that Defined the Week: DAL, CSV, NKE, BBBY, SNAP, GIS, STZ   (WSJ)
    • The Week in Business: Spending More, Getting Less.  (NYT)
    • American Airlines (AAL) computer glitch disrupts pilots’ schedules. (WSJ)
    • President Biden is expected to roll back some tariffs on Chinese imports soon. People familiar with the situation say what comes next has been pending with Mr. Biden in recent weeks and that he could announce his decision this week.
    • Chinese Property Developer Shimao defaults on $1 Billion Dollar Bond.
    • Morgan Stanley Warns US Growth Slowdown Worse Than Expected. (Bloomberg)
    • Global oil prices could reach a “stratospheric” $380 a barrel if US and European penalties prompt Russia to inflict retaliatory crude-output cuts, JPMorgan Chase & Co. analysts warned.  (Carl Q CNBC)
    • Copper falls to the lowest level in 17 months, with metals extending losses as global recession fears continue to damp the demand outlook for commodities. (Bloomberg)
    •  Barron’s:
      • Positive View: MSFT, LVS.
      • Cautious View: None of note.
      • Mixed View: None of note.
  • Exchange/Listing/Company Reorg and Personnel News:
    • Bright Green (BGXX) Announces CEO Transition.
    • MEDIROM Healthcare Technologies Inc. (MRM) Receives Nasdaq Notification Regarding Minimum Market Value Deficiency.
    • The Very Good Food Company (VGFC) Announces Board and Management Team Changes.
  • Buyback Announcements or News:
    • ASML reports transactions under its current share buyback program.
    • DHT repurchased 2.83 million shares, or 1.7% of shares outstanding, in Q2 at an average price of $5.6256.
    • U.S. Global Investors (GROW) Provides Update on Enhanced Stock Buyback and Dividend Programs, Responds to Proposal.
  • Stock Splits or News:
  • Dividends Announcements or News:
    • Bank OZK (OZK) increases quarterly cash dividend by $0.01 per share to $0.32 per share, a 3.2% increase.
    • BBI trading reverse split price this morning.

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

S&P 500 -30, Dow Jones -219, NASDAQ -117, and Russell 2000 -11. Europe lower and Asia higher ex Shanghai.  VIX Futures are at 28.15 from 29.05 on Friday morning and the VIX closed at 26.70 from 28.71 on Friday. Gold lower, Silver higher 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 2.915% from 2.946% on Friday morning. Bitcoin is at $19,731 from $19,151on Friday morning and is lower by -0.29% this morning. As of 8:02 a.m. EDT.

Sector Action – 07/01/22 Close (1/3/6/12/YTD Updated Weekly with Monday release):   

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

Last in the session moved indexes up after staying in a relative narrow range.  Russell 2000 increased 1.16% and TLT was up 1% to close at $115.82. Updated 07/01/22 close.

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

  • Tuesday After the Close: None of note.
  • Wednesday 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 07/01/22 close.

Gap Ups & Down In Early Pre-Market:

  • Gap Up: COWN +12%, OCFT +11%, ASTS +7%, TUP +6%, DRIO +6%, VET +4%.
  • Gap Down: NIU -6%, ATAI -6%.

Insider Action: NKE sees Insider buying with dumb short selling.  KFS sees Insider buying with smart short sellers. 07/01/22 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: TSLA, OXY, XOM, CROX (CNBC)
  • Five Things You Need to Know to Start Your Day (Bloomberg)
  • 5 things to know before the stock market opens Tuesday (CNBC)
  • Bloomberg Lead Story: Stocks fall on recession concerns, Euro weak again.  (Bloomberg)
  • Bloomberg Most Read Story:  Person of interest in custody in Highland Park shooting. (Bloomberg)
  • Likelihood of U.S. recession is rising. (Bloomberg)
  • 74% of consumer in U.S. concerned about a possible recession. (CNBC)
  • Euro hits a twenty year low against U.S. Dollar. (CNBC)
  • NATO expansion begins. (Bloomberg)
  • More parts of China battle Covid-19 and shutdowns rise again. (CNBC)
  • Russia claims victory in the Luhansk province of Ukraine. (Reuters)
  • Tesla (TSLA) to pause production in China and Germany for several weeks. (Bloomberg)
  • TSMC (TSM) supplier predicts higher chip prices when everyone talking about lower prices. (Bloomberg)
  • Robinhood Snacks looks at Tech companies and protection of users regarding Roe vs Wade changes in future abortions.

Moving Average Update:

  • Score improves to 20%.  Updated 06/30/22 close.

Geopolitical: 

  • President’s Public Schedule:
    • The President receives the President’s Daily Brief, 9:30 a.m. EDT
    • The President awards the Medal of Honor to four U.S. Army Soldiers who fought in the Vietnam War; The First Lady attends, 11:15 a.m. EDT
    • Press Briefing by Press Secretary Karine Jean-Pierre, 3:00 p.m. EDT

Economic: 

  • May Factory Orders are due out at 10:00 a.m. EDT and expected to come in at 0.5% from 0.3%. 
  • Investor Movement Index  12:30 p.m. EDT 

Federal Reserve / Treasury Speakers:

  • None of note.

M&A Activity:

  • Alerus (ALRS) Completes Acquisition of Metro Phoenix Bank.
  • GCM Grosvenor (GCMG) and Blue Wolf Capital acquire Hallcon Corporation.
  • Nelnet (NNI) acquires solar construction firm GRNE Solutions.

Meeting & Conferences of Note:

  • Sellside Conferences:
    • None of note.
      • Previously posted and ongoing conferences:
        • None
  • Company Meetings:  ZEPP
  • Fireside Chat: None of note.
  • Investor/Analyst Day/Calls: F, SNY
  • Update: None of note.
  • R&D Day: None of note.
  • Company Event: None of note.
  • Industry Meetings:
    • FPGA Conference Europe 2022 (07/05/22-07/09/22)
    • 3rd FORUM Science & Health: Medicine of the Future (07/05/22-07/06/22)
    • 17th International Congress on Neuromuscular Diseases (ICNMD) (07/05/22-07/09/22)
      • Previously posted and ongoing conferences:
        • None

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: