CAPIS Morning Note – 09/30/22: Stocks Look To Open Higher But Lots Of Economic Data This Morning

Overnight Summary: The S&P 500 closed Thursday at 3640.17 (lower by -2.11%) from Wednesday at 3719.04 (higher by 1.97%). The overnight high of 3693.75 was hit at 5:00 p.m. EDT. The low was hit at 3640.25 at 12:10 a.m. EDT, a range of 53 points high to low which is above the recent range of…

Overnight Summary: The S&P 500 closed Thursday at 3640.17 (lower by -2.11%) from Wednesday at 3719.04 (higher by 1.97%). The overnight high of 3693.75 was hit at 5:00 p.m. EDT. The low was hit at 3640.25 at 12:10 a.m. EDT, a range of 53 points high to low which is above the recent range of 45.  

Earnings Out After The Close:

  • Beats: MU +0.07, NKE +0.01.
  • Flat: CMTL.
  • Misses: None of note.

Chart of Interest: NKE will open down this morning.  Currently an Erlanger Type 3 in the work, but certainly been gathering shorts that typically get burned based on NKE’s Short Interest Performance Ranks.  Lots of shorts in the Footwear Industry Group too.

Capital Raises:

  • IPOs Priced or News: None of note.
  • New SPACs launched/News:
    • YS Biopharma to merge with Nasdaq-listed Summit Healthcare Acquisition Corp. (SMIH)
  • Secondaries Priced:
    • VALN: 21  million ADS offering priced at $9.51 per ADS.
  • Notes Priced of note: None of note.
  • Common Stock filings/Notes:
    • ATER: Announces Pricing of $20 Million Registered Direct Offering.
  • 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:
    • KUKE: Filed Form F-3.. $100 Million Mixed Shelf.
  • Debt Filing/Notes: 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: AMLX +10%, XOS +7%, RC +6%.
    • Trading Down: RCII -19%, NKE -9%, AAN -6%.
  • News Since The Close:
    • Nike (NKE) stock drops -10% as execs predict cheaper clothing for at least the rest of the year. (MarketWatch)
    • Federal Reserve San Francisco President Mary Daly: No U.S. recession needed to defeat high inflation. (Reuters)
    • Japan Spent 2.8 Trillion Yen In September FX Intervention.
    • Toyota (TM) cuts October production target by 6.3% amid chip shortage.
    • BofA’s Bull & Bear Indicator Remains At “Max Bearish“.
    • China tells banks to provide $85 Billion property funding by year-end. (Bloomberg)
  • Exchange/Listing/Company Reorg and Personnel News:
    • Blue Apron (APRN) Announces CFO Transition. (MarketWatch)
    • Fannie Mae (FNMA) names Priscilla Almodovar as CEO.
    • Forestar (FOR) announces the promotion of Mark Walker to Chief Operating Officer.
    • Invacare Corporation (IVC) Receives Notice of Noncompliance with NYSE Trading Share Price Listing Rule.
    • Janus Henderson Group (JHG) Chair to retire.
    • Match Group (MTCH) Appoints Linda Kim as Chief Operating Officer of Hyperconnect.
    • Philips (PHG) announces that today’s Extraordinary General Meeting of Shareholders appointed Roy Jakobs as the company’s next President and Chief Executive Officer.
    • Rent-A-Center, Inc. (RCII) Announces New EVP – Chief Financial Officer.
    • Westport (WPRT) Announces the Resignation of Chief Financial Officer Richard Orazietti and Appoints William Larkin as Successor.
  • Buyback Announcements or News:
    • American Outdoor Brands (AOUT) Board of Directors Approves $10 Million Share Repurchase Program.
    • British American Tobacco (BTI) announces share buyback.
    • Daseke (DSKE) approved a stock repurchase program authorized to repurchase up to $40 million of its outstanding common stock.
    • Equinor (EQNR) names Torgrim Reitan as new CFO.
    • Kinross (KGC) announces approval to increase normal course issuer bid as part of enhanced share buyback program.
    • Ready Capital Corporation (RC) announces increase to share repurchase program.
    • Scorpio Tankers (STNG) purchased 225,000 shares of common stock in the open market today at average price of $40.80 per share.
    • X Financial (XYF) Upsizes Share Repurchase Program to US$20 Million.
  • Stock Splits or News:
    • AVCT Announces Intent to Effect Reverse Stock Split.
  • Dividends Announcements or News: 
    • IBM CUTS QUARTERLY DIVIDEND BY 78%…or IBM — Tweet by Bloomberg was retracted…or IBM dividend tweet was also mentioned by CARL Q CNBC .

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

S&P 500 +9, Dow Jones +41, NASDAQ +27,  and Russell 2000 +8. (as of 8:15 a.m. EDT). Europe higher and Asia lower ex Hong Kong.  VIX Futures are at 30.85 from  31.37  yesterday morning and the VIX closed at 31.84 from 30.18 Wednesday. Gold, Silver and Copper higher. WTI Crude Oil and Brent Oil Futures higher as well as Natural Gas higher. $ is higher vs Euro, higher vs Pound and higher vs Yen. US 10-year Treasury sees yields at 3.70% from 3.822%  yesterday morning. Bitcoin is at $19,498 from $19,494 yesterday morning and is higher by 0.54% this morning.

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

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

Yesterday’s rally was completely revered.  NASDAQ was down 2.86%.  TLT remains above the 100 mark closing down 0.52% to 103.79.

Click here for a video explanation of Erlanger Value Lines.

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

  • Friday After the Close: None of note.
  • Monday 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: CCL (approx 9:15 a.m. EDT)

Guidance:

  • Positive Guidance: CMTL of note.
  • Negative Guidance: MU, RCII of note.

Erlanger Research Advance/Decline Chart: 

Gap Ups & Down In Early Pre-Market:

  • Gap Up: AMLX +7%, XOS +6%, RC +5%.
  • Gap Down: RCII -16%, NKE -9%, AAN -5%, FL -4%.

Insider Action: GNTY sees Insider buying with dumb short selling.  IMVT 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.

  • Stocks Making The Biggest Moves: NKE MU AMLX RCII APRN GNRC VOYA  (CNBC)
  • Five Things To Know Before Market Opens Friday. (CNBC)
  • Five Things You Need to Know to Start Your Day Friday (Bloomberg)
  • Bloomberg Lead Story: President Biden declares Emergency for South Carolina. (Bloomberg)
  • Bloomberg Most Read Story: Meta (META) to cut head count, slash budgets. (Bloomberg)
  • Russian President Putin will annex part of Ukraine today. (CNN)
  • Senate passes a stop gap spending bill to keep government working through December 16th. Heads to House. (CNBC)
  • FAA has still not completed work to certify the 737 Max later this year. (Reuters)

Moving Average Update:

  • Score goes from 20% to 0%.  Complete reversal.

Geopolitical: 

  • President’s Public Schedule:
    • The President receives the President’s Daily Briefing, 9:00 a.m. EDT
    • The President and The First Lady depart the White House, 9:30 a.m. EDT
    • The President, The First Lady, The Vice President, and The Second Gentleman attend the investiture ceremony for Associate Supreme Court Justice Ketanji Brown Jackson, 10:00 a.m. EDT
    • The President and The First Lady arrive at the White House, 10:40 a.m. EDT
    • The President delivers remarks on the ongoing federal response efforts for Hurricane Ian, 11:30 a.m. EDT
    • The President and The First Lady host a reception to celebrate the Jewish New Year; The Vice President attends; The Second Gentleman delivers remarks, 12:00 p.m. EDT
    • Press Briefing by Press Secretary Karine Jean-Pierre, 2:45 p.m. EDT
    • The President and The First Lady host a Hispanic Heritage Month reception and deliver remarks, 4:00 p.m. EDT

Economic: 

  • August Personal Income is due out at 8:30 a.m. EDT and expected to come in at 0.3% from 0.2%.
  • August PCE Core is due out at 8:30 a.m. EDT and is expected to come in at 0.4% from 0.1% last month.
  • September Chicago PMI is due out at 9:45 a.m. EDT and is expected to come in at 51.9 from 52.2 last month.
  • September University of Michigan Consumer Sentiment (final) is due out at 10:00 a.m. EDT and is expected to remain at 59.50.
  • Baker Hughes Rig Count 1:00 p.m. EDT
  • Farm Prices 3:00 p.m. EDT

Federal Reserve / Treasury Speakers:

  • Federal Reserve Richmond President Thomas Barkin 8:30 a.m. EDT
    Federal Research Board of Governors Lael Brainard 9:00 a.m. EDT
    Federal Research Board of Governors Michelle Bowman 11:00 a.m. EDT
    Federal Reserve Richmond President Thomas Barkin 12:30 p.m. EDT
    Federal Reserve New York President John Williams 4:15 p.m. EDT 

M&A Activity:

  • Arthur J. Gallagher (AJG) to acquire M&T Insurance Agency from M&T Bank.
  • CTG Acquires Eleviant Tech to Accelerate Digital Transformation Strategy and Portfolio Innovation.

Meeting & Conferences of Note:

  • Sellside Conferences:
    • Benzinga Virtual Retail Conference 2022
      • Previously posted and ongoing conferences:
        • Jefferies Cell and Genetic Medicine Summit (09/29/22-09/30/22)
        • Wolfe Research Utilities, Midstream & Clean Energy Conference (09/28/22-09/30/22)
  • Company Meetings: CIAN
  • Fireside Chat: None of note.
  • Investor/Analyst Day/Calls: NLSP
  • Update:
    • Amylyx Pharmaceuticals (AMLX) Conference Call on FDA Approval of RELYVRIO for the Treatment of ALS.
    • Alnylam Pharmaceuticals (ALNY) Webcast from HFSA to Discuss APOLLO-B Phase 3 Results.
  • R&D Day:
    • Astria Therapeutics (ATXS) Virtual R&D Day 2022.
  • Company Event:
    • CareDx Symposium (CDNA) Covering Innovation in Multimodal Surveillance Including AiCAV for Post-Cardiac Transplant Care 2022. (10/02/22)
  • Industry Meetings:
    • American Academy of Ophthalmology Meeting (09/30/22-10/03/22)
    • Heart Failure Society of America (HFSA) Annual Scientific Meeting 2022 (09/30/22-10/03/22)
    • Hypertrophic Cardiomyopathy Medical Society’s (HCMS) inaugural 2022 Scientific Sessions
    • Association for Vascular Access (AVA) Annual Scientific Meeting 2022 (09/30/22-10/03/22)
    • 12th International Pediatric Intestinal Failure and Rehabilitation Symposium (PIFRS) 2022 (09/30/22-10/02/22)
    • National Association of Convenience Stores Trade Show and Petroleum Equipment Institute Convention 2022 (10/01/22-10/04/22)
      • Previously posted and ongoing conferences:
        • International Gynecologic Cancer Society (ICGS) Annual Meeting 2022 (09/29/22-10/01/22)
        • 77th Annual Meeting of the American Society for Surgery of the Hand (ASSH) 2022  (09/29/22-10/01/22)
        • CRI-ENCI-AACR 6th International Cancer Immunotherapy Conference (CICON) 2022 (09/28/22-10/01/22)
        • Next Generation Protein Therapeutics Summit 2022 (09/28/22-09/30/22)
        • Society of Hematologic Oncology (SOHO) 10th Annual Meeting 2022 (09/28/22-10/01/22)
        • Mobile World Congress (09/28/22-09/30/22)
        • BioProcess International Conference and Exhibition 2022 (09/27/22-09/30/22)

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: