Overnight Summary: The S&P 500 closed Monday higher by 0.69% at 4399.77 from Friday lower by -0.01% at 4369.71. Overnight ranges saw the high hit at 4432.75 at 6:45 a.m. EDT while the low was hit at 4402.25 at 8:15 a.m. EDT. The range overnight was 30 points. The 10-day average of the overnight range is at 27.10 from 27.70 yesterday.  The average for May/June/July average was 18.81 from 19.94 in May/June. Currently, the S&P 500 is higher by +15.75 points and by +0.36% at 7:15 a.m. EDT.

Key Story: How Hard Should the Fed Squeeze to Reach 2% Inflation. Article by Nick Timiraos who is tied to Chairman Powell. Does this mean a shift to accepting 3% inflation over 2% could be made public at Powell’s  Jackson Hole on Friday? The article was published at midnight for today’s paper. (WSJ)

Earnings Out After The Close: 

• IPOs Priced or News:
  • Arm Holdings files registration statement with SEC for proposed IPO; applies to list on the Nasdaq under symbol “ARM”. (WSJ)
  • Healthcare software firm Waystar eyes $8 billion valuation in U.S. IPO-sources. (Reuters)
• New SPACs launched/News:
  • Arisz Acquisition Corp. (ARIZ) Announces Extension of Deadline to Complete Business Combination.
• Secondaries Priced:
  • FMST: prices $4M public offering.
  • LSEA: Prices offering by its stockholder Green Investment Alpha Limited of 4,207,574 shares at $9.75 per share.
• Notes Priced of note:
  • PCT: Announces Upsize and Pricing of $215.0 Million 7.25% Green Convertible Senior Notes Due 2030.
• Common Stock filings/Notes:
  • ASUR: Closing of Public Offering of Common Stock.
  • RYTM: Sold $50 million in shares from its ATM program in recent weeks.
  • SABS: Filed Form S-3.. Up to 1,916,894 Shares of Common Stock.
• Direct Offering: None of note.
• Selling Shareholders of note:
  • HWM: Form S-3 .. Up to 9,268,011 shares of Common Stock by selling shareholders.
  • LSEA: commences secondary offering of 4,207,574 shares of common stock by selling shareholder.
• Private Placement of Public Entity (PIPE): None of note.
• Mixed Shelf Offerings: None of note.
• Debt/Credit Filing and Notes:
  • HDSN: Announces Full Repayment of Outstanding Term Debt.
  • PMN: Announces $20.4 Million Private Placement Financing.
• Tender Offer: None of note.
• Convertible Offering & Notes Filed:
  • BLK: Northvolt raises $1.2 billion convertible note as first energy storage systems are produced at Northvolt Dwa.
  • PCT: Announces Private Offering of $200.0 Million of Green Convertible Senior Notes.

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 Holiday:

• After Hours: 
  • Trading Up: FN +16% ZM +4% of note.
  • Trading Down: PCT -15%, LSEA -6%, EBS -5%, NDSN -5% of note.
• News Items After the Close:
  • Stocks making the biggest moves after hours:   (CNBC)
  • US Treasury Yields Hit 16-Year High On Fears Over Interest Rate Outlook. (FT)
  •  S&P Joins Moody’s In Cutting US Banks Amid ‘Tough’ Environment. (Bloomberg)
  • Nordson (NDSN) stock drops 7% after company’s revenue miss, lowered guidance. (MarketWatch)
  • Fabrinet (FN) stock rallies as new AI products lift results. (MarketWatch)
  • Coinbase (COIN) Gets a Stake in Stablecoin Operator Circle and USDC Adds 6 New Blockchains. (CoinDesk)
  • Lockheed Martin (LMT) awarded $347 million U.S. Navy contract modification.

• Exchange/Listing/Company Reorg and Personnel News:
  • Index Changes: Kenvue (KVUE) to join S&P 500; Advance Auto Parts (AAP) to join S&P SmallCap 600.
  • Aris Water Solutions, Inc. (ARIS) Announces New Leadership Appointments.
  • Baxter (BAX) Announces Updates to Its Board of Directors.
  • Bionano (BNGO) Regains Compliance with Nasdaq Minimum Bid Price Listing Requirement.
  • CenterPoint (CNP) appoints Earl Cummings as Independent Chair of the Board.
  • Charles Schwab (SCHW) planning actions to streamline operations related to the integration of TD Ameritrade; to downsize corporate offices, reduce headcount; expects to realize at least $500 million of incremental annual run-rate cost savings. (MarketWatch)
  • Fidelity Nat’l Info (FIS) appoints James Kehoe as CFO.
  • Teva (TEVA) Settles Price Fixing Charges With U.S. DOJ, will pay $225 million over five years. (MarketWatch)
  • Valens Semiconductor (VLN) Announces CFO Transition.
  • Westport Fuel Systems (WPRT) announced today that David Johnson, Chief Executive Officer has decided to step down as chief executive officer and will resign from the Board, effective immediately.
• Buyback Announcements or News:
  • Agiliti (AGTI) Announces Share Repurchase Plan.
  • AGTI: Approves stock repurchase program for up to $50 mln of shares of common stock.
  • The Eastern Company (EML) Announces Program to Repurchase Up to 200,000 Shares by August 20, 2028.
  • Fabrinet (FN) adds $47.6 million to repurchase authorization.
• Stock Splits or News: None of note.
• Dividends Announcements or News: 
  • SS&C Techs (SSNC) increases quarterly dividend by 20% to $0.24 per share.
• Insider Sales Of Note: None of note.

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

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

• Daily Positive Sectors: Technology, Consumer Cyclical, Communication Services of note.
• Daily Negative Sectors: Real Estate, Utilities of note.
• One Month Winners: Energy, Communication Services of note.
• Three Month Winners: Energy, Consumer Cyclical, Industrials of note.
• Six Month Winners: Communication Services, Technology, Consumer Cyclical of note.
• Twelve Month Winners: Energy, Industrials, Technology of note.
• Year to Date Winners:  Communication Services, Technology, Consumer Cyclical of note.

A good day for tech shares helped support stock indexes on Monday even while Treasury yields climbed to new decade-plus highs.  Fresh off its third straight week of declines, the tech-heavy Nasdaq Composite was the top-performing major index, rising 1.6%. The S&P 500 climbed 0.7%, while the Dow Jones Industrial Average slipped roughly 37 points, or 0.1%.  Stocks have been pressured recently by rising bond yields but were largely able to withstand a further jump in yields—wavering a bit in early trading and ultimately finding their footing again.  The yield on the benchmark 10-year U.S. Treasury note settled at 4.339%, up from 4.251% Friday. That surpassed its nearly 16-year high set last Thursday to again mark its highest close since late 2007.  (WSJ – edited by QPI)

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

• Gap Up: FN +18%, SCLX +13%, DHC +6%, MTRX +5%, BIDU +4%, ZM +4%, SOPH +4% of note.
• Gap Down: PCT -13%, EBS -8%, LSEA -4%, BWMN -4% of note.

Insider Action: BWXT, SPB sees Insider buying with dumb short selling.  FNKO, ASYS 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)
• Five Things You Need to Know to Start Your Day. (Bloomberg)
• Bloomberg Lead Story: Microsoft Pushes to Get Activision Deal Done With Fresh UK Offer. (Bloomberg)
• Bloomberg Most Shared Story: S&P Joins Moody’s in Cutting U.S. Banks Amid Tough Climate. (Bloomberg) 
• Stocks rally as Nvidia Earnings Put Focus on Tech: Market Wrap. (Bloomberg)
• Microsoft CEO Satya Nadella says AI is a tidal wave as big as the internet. (Bloomberg)
• 500,000 jobs at risk of disappearing in payroll revision. (Bloomberg)
• Dick’s (DKS) shares fall 20% on earnings miss and guidance cut. (CNBC)
• Lowe’s (LOW) sticks by guidance despite weaker sales. (CNBC)
• Macy’s (M) beats sales estimates but stands by cautious outlook. (CNBC)
• NPR Marketplace: Wall Street is zooming in on Nvidia, which reports quarterly earnings this week. Nvidia’s components power many of the generative artificial intelligence models that have surged in popularity, and its financial results will provide clues about the strength of the industry that runs on its technology. Also on the show: diminishing appetite for U.S. bonds, life in a fire lookout tower and vanishing tattoo ink. (Podcast)
• BBC Global News: Biden arrives in Hawaii after deadly wildfires. (Podcast) 
• NY Times The Daily: Florida coral reef is in trouble due to warming. (Podcast)
• Bloomberg: The Big Take: Massive wind turbines are rising from the Atlantic Ocean. (Podcast)
• Wealthion: The Bond King Bill Gross is bearish on both stocks and bonds. (Podcast)

Moving Average Update:

• Score bumps up to 31% from 20%.

Geopolitical: 

M&A Activity and News: None of note.

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 is 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: