CAPIS Morning Note – 07/07/22: Stocks Higher As We Approach The Open, British PM Boris Johnson Resigns

Overnight Summary: The S&P 500 closed Wednesday at 3845.08 (higher by 0.36%) from 3831.39 (higher by 0.16%) on Tuesday.  Futures are trading higher in the premarket session but off the highs. The overnight high of 3867.50 was hit at 5:00 a.m. EDT. The low was hit at 3832.50 at 9:45 p.m. EDT, a range of…

Overnight Summary: The S&P 500 closed Wednesday at 3845.08 (higher by 0.36%) from 3831.39 (higher by 0.16%) on Tuesday.  Futures are trading higher in the premarket session but off the highs. The overnight high of 3867.50 was hit at 5:00 a.m. EDT. The low was hit at 3832.50 at 9:45 p.m. EDT, a range of 35 points high to low which is  below the range of late with 45 the average range. At 7:25 a.m. EDT the current price is 3857.25 which is +0.23% and 9 points.

Breaking News: British Prime Minister Boris Johnson resigns in a live broadcast. (Bloomberg)

Earnings Out After The Close:

  • Beats: SLP +0.03.
  • 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:
    • IMPP: Filed Form F-1.. 31,150,000 Shares of Common Stock.
    • KLAC: Announces Pricing of Tender Offer.
    • NAPA: Announces Secondary Offering of 5,000,000 Shares of Common Stock.
    • OIS: Filed Form S-3.. 1,909,722 Shares of Common Stock.
    • SBOW: Filed Form S-3.. 4,148,472 Shares of Common Stock.
  • 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: 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: VERU +19%, GME +7%, BBBY +6%, SPCE +4%.
    • Trading Down: CTMX -27%, USNA -10%, ATRA -6%, NAPA -6%.
  • News Since The Close:
    • Apple (AAPL) Plans Extreme Sports Watch With Larger Screen, Metal Case (BNN Bloomberg).
    • Twitter (TWTR) is working on in-app Podcast player.
    • Morgan Stanley Says Inflation In Asia Set To Peak This Quarter. (Bloomberg)
    • China Mulls $220 Billion Stimulus With Unprecedented Bond Sales. (Bloomberg)
    • Bank of Japan (BoJ) Expected To Raise Fy2022 Inflation Forecast To Slightly Above 2% From Current 1.9% In Quarterly Outlook Report Due July 21 – Expected To Cut Fiscal 2022 Economic Growth Forecast From Current +2.9% In Quarterly Report – Likely To Maintain Ultra-Low Interest Rates – (Reuters)
    • Lattice Semi (LSCC) announces collaboration with Google’s (GOOGL) Chromebook and Lenovo to equip the Lenovo IdeaPad Flex 5i Chromebook with new machine learning user experiences.
    • The Number Of Confirmed Cases Of Covid-19 In Hong Kong Exceeded 3,000 In A Single Day, A 3-month High; Officials Said There Is A Chance Of Doubling In A Week Or Two.
    • WHO calls emergency meeting as global monkeypox cases cross 6,000. Cases have now been reported from 58 countries, with over 80% of the cases in Europe.  (Reuters)
    • Jacobs (J) Awarded $3.9B Engineering and Science Contract at NASA.
  • Exchange/Listing/Company Reorg and Personnel News:
    • Altisource Asset Management Corporation (AAMC) Announces Appointment of CEO.
    • Bed Bath & Beyond (BBBY) interim CEO Sue Gove purchases 50,000 shares on July 1.
    • China Green Agriculture (CGA) announces receipt of NYSE late filer cure letter.
    • Compass Diversified Holdings (CODI) Announces New Board of Director Appointments.
    • Enstar Group (ESGR) President to retire in March of 2023.
    • Hawaiian Electric (HE) appointed Paul K. Ito as interim CFO.
    • Spark Networks (LOV) Proposes Two New Directors for its Administrative Board Slate.
    • Tempur Sealy Int’l (TPX) extended the term of Scott Thompson’s employment contract as Chairman, CEO and President of the Company.
    • WD-40 (WDFC) appoints Sara Hyzer as CFO.
  • Buyback Announcements or News: 
    • Shore Bancshares (SHBI) Announces New Stock Repurchase Program.
    • Energy Services of America (ESOA) announces share repurchase program.
  • Stock Splits or News:
    • Avalo Therapeutics (AVTX) Announces One-for-Twelve Reverse Stock Split.
    • GameStop (GME) Announces Four-for-One Stock Split.
  • Dividends Announcements or News:
    • Crescent Point Energy (CPG) increases quarterly dividend 20% to $0.08 per share.

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

S&P 500 +14, Dow Jones +138, NASDAQ +61, and Russell 2000 +8. Europe lower and Asia higher ex Shanghai.  VIX Futures are at 27.13 from 28.05 yesterday morning and the VIX closed at 26.73 from 27.54  yesterday. Gold, Silver and Copper higher. WTI Crude Oil  and Brent Oil Futures higher and Natural Gas higher. $ is lower vs Euro, lower vs Pound and lower vs Yen. US 10 year Treasury sees yields at 2.932% from 2.814% yesterday morning. Bitcoin is at $20,455 from $20,052  yesterday morning and is higher by +0.57% this morning. As of 8:04 a.m. EDT.

Sector Action – 07/06/22 Close (1/3/6/12/YTD Updated Weekly with Monday release):   

  • Daily Positive Sectors: Utilities, Technology, Healthcare, Industrials of note.
  • Daily Negative Sectors: Energy, Real Estate, Consumer Cyclical, Financials of note.
  • One Month Winners: Healthcare  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.

We got a peek at how the FED will progress with taming inflation.  Investors seemed to approve with a positive tone by the closing bell.  It is notable the RUT was down 0.79% though.   Updated 07/06/22 close.

 

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

  • Thursday After the Close: LEVI, WDFC of note.
  • Friday Before the Open: none of note.

Earnings of Note This Morning:

  • Beats: HELE +0.55.
  • Flat: None of note.
  • Misses: None of note.
  • Still to Report: None of note.

Guidance:

  • Positive Guidance: none of note.
  • Negative Guidance: ABBV, VIVO of note.

Erlanger Research Advance/Decline Chart: Updated through 07/06/22 close.

Gap Ups & Down In Early Pre-Market:

  • Gap Up: VERU +11%, GME +9%, BBBY +6%, SGEN +6%, CPG +5%, SPCE +4%, ATRA +4%, HITI +4%.
  • Gap Down: CTMX -17%, USNA -10%, SBOW -8%, NAPA -6%, CWT -4%.

Insider Action: BBBY (see above) sees Insider buying with dumb short selling.  TCDA sees Insider buying with smart short sellers. 07/06/22 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: GME SGEN SPCE BBBY HELE (CNBC)
  • Five Things You Need to Know to Start Your Day (Bloomberg)
  • Bloomberg Lead Story: Pound rises as Johnson resigns.  (Bloomberg)
  • Bloomberg Most Read Story: U.S. and its allies discuss capping Russian oil at $40 to $60. (Bloomberg)
  • China considers a $200 billion stimulus with bond sales. (Bloomberg)
  • Japan Prime Minister faces Upper House Election. (Reuters)
  • Shell (SHEL) maintains plan to drill in the Gulf of Mexico. (WSJ)
  • Helen of Troy (HELE) beat estimates but guided lower and is selling off down -6.7%. (CNBC)
  • Robinhood Snacks looks at European Union new antitrust rules on Big Tech to hurt Apple (AAPL) App control. Amazon (AMZN) buys into Grubhub for Prime users.

Moving Average Update:

  • Score remains at 43%.  Updated 07/06/22 close.

Geopolitical: 

  • President’s Public Schedule:
    • The President and The Vice President receive the President’s Daily Brief, 10:15 a.m. EDT
    • The President awards the Presidential Medal of Freedom to seventeen recipients; The Vice President and The Second Gentleman, 2:00 p.m. EDT
    • Press Briefing by Press Secretary Karine Jean-Pierre, 3:10 p.m. EDT

Economic: 

  • Challenger Job Cut (June) Actual: 32.517K VS 20.712K Previous.
  • June ADP Employment Report is due out at 8:15 a.m. EDT and expected to come in at 190,000 from 128,000. 
  • International Trade in Goods 8:30 a.m. EDT
  • EIA Natural Gas Report 10:30 a.m. EDT
  • EIA Petroleum Report 11:00 a.m. EDT

Federal Reserve / Treasury Speakers:

  • Federal Reserve St. Louis President James Bullard 1:00 p.m. EDT 
    Federal Research Board of Governors Christopher Waller 1:00 p.m. EDT 

M&A Activity:

  • Aviat Networks (AVNW) urges Ceragon Networks’ (CRNT) to schedule an extraordinary meeting of shareholders, which Aviat called for on June 27th.
  • Endeavour Silver (EXK) completes Pitarrilla acquisition.
  • First Bancshares (FBMS) receives all required regulatory approvals for its proposed acquisition of Beach Bancorp.
  • Henry Schein (HSIC) Completes Acquisition of Condor Dental.
  • Merck (MRK) Is in Advanced Talks to Buy Seagen for Roughly $40 Billion or More. (WSJ)
  • Meridian Bioscience, Inc. (VIVO) Enters into Agreement to Be Acquired by SD Biosensor and SJL Partners in $1.53 Billion All-Cash Transaction.

Meeting & Conferences of Note:

  • Sellside Conferences:
    • None of note.
      • Previously posted and ongoing conferences:
        • None
  • Company Meetings: MNDT.
  • Fireside Chat: None of note.
  • Investor/Analyst Day/Calls: ADN, CNTX, TIIAY
  • Update: None of note.
  • R&D Day: CDTX.
  • Company Event: None of note.
  • Industry Meetings:
    • Connected Future Transport Systems
    • Small Cap Growth Virtual Investor Conf
      • Previously posted and ongoing conferences:
        • LoRaWAN World Expo 2022 (07/06/22-07/07/22)
        • Solar Energy20 Future Europe 2022 (07/06/22-07/07/22)
        • 16th World Immune Regulation Meeting (WIRM) 2022 (07/06/22-07/09/22)
        • FPGA Conference Europe 2022 (07/05/22-07/09/22)
        • 17th International Congress on Neuromuscular Diseases (ICNMD) (07/05/22-07/09/22)

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: