CAPIS Morning Note – 10/24/22: Overnight Stocks Were Higher, Then Lower and Now Higher Again.

Overnight Summary: The S&P 500 closed Friday at 3752.74 (higher by 2.37%) from Thursday at 3665.78 (lower by -0.80%.  The overnight high of 3813.25 was hit at 6:10 a.m. EDT. The low was hit at 3736.50 at 4:45 a.m. EDT, a range of 76.75 points high to low which is above the recent range of…

Overnight Summary: The S&P 500 closed Friday at 3752.74 (higher by 2.37%) from Thursday at 3665.78 (lower by -0.80%.  The overnight high of 3813.25 was hit at 6:10 a.m. EDT. The low was hit at 3736.50 at 4:45 a.m. EDT, a range of 76.75 points high to low which is above the recent range of 45.  At 7:05 a.m. EDT, the S&P 500 was up 9 points which is 0.24%.  

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:
    • CNSP: Filed Form S-1.. Up to $8,500,000 Common Stock and Warrants.
    • DFLI: Filed Form S-1.. Up to 21,512,027 Shares of Common Stock.
    • FAT: Announces Redemption Of $43.2 Million Of Series B Cumulative Preferred Stock At $23.69 Per Share.
    • PRST: Filed Form S-1.. Primary Offering of 16,250,000 Shares of Common Stock Secondary Offering of 46,949,333 Shares of Common Stock 7,625,000 Warrants to Purchase Shares of Common Stock.
    • SLNH: Proposed Public Offering of Common Stock.. Univest 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:
    • Ascent Solar (AXDX) files $100 million shelf offering.
    • ASTI: Filed Form S-3.. $100 Million Mixed Shelf.
  • Debt Filing/Notes: None of note.
  • Tender Offer: 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 and Over the Week:

  • Weekly Wrap Up: Best and Worst performing large cap stocks:
    • Trading Up: ACOR 58.1%, KLXE 39.2%, CLNE 34.6%, GLT 29.8%, MGNX 29.0%, IAG 28.6%, BHVN 27.8%, TUSK 26.4%, DOMO 25.5%, PARR 25.5%, PACB 24.7%, LIND 23.8%, PUMP 23.5%, RIG 23.0%, CVI 22.8%, OIS 22.3%, PRTY 22.2%, TDW 22.1%.
    • Trading Down: SIEN -58.2%, THC -29.4%, UBX -25.3%, SIVB -24.4%, GNRC -20.7%, SFBS -17.4%, CVNA -16.5%, RUBY -15.7%, ABEO -15.2%, RGEN -14.5%, SQQQ -14.3%, DNLI -14.3%, KZR -13.2%, BZUN -13.0%, MTB -12.3%, LOB -12.1%, ERIC -11.9%, LOCO -11.4%.
  • News Items After the Close:
    • Accelerate Diagnostics (AXDX) discloses that FDA clarified the company must obtain 510 (k) clearance to continue marketing and distributing Accelrate Arc Products in U.S.
    • Encompass Health (EHC) to build a freestanding, 50-bed inpatient hospital in Florida.
    • Lockheed Martin (LMT) wins a $477 million U.S. Army Contract.
    • AbbVie (ABBV) Drug RINVOQ is now approved as the first and only oral JAK inhibitor for adults with active non-radiographic axial spondyloarthritis.
  • News Items Over the Weekend:
    • The Week in Business: Liz Truss Concedes to the Markets  (NYT)
    • Former U.K. Prime Minister Boris Johnson pulls out of leadership race to replace Liz Truss. (CNBC)
    • China names Xi Jinping loyalists for core leadership group. (CNBC)
    • Tripledemic hits U.S. Covid, RSV and the Flu. (NYT)
    • Black Adam brings in $67 million, first opening movie weekend above $50 million since July.
    • Activist Short Seller Nathan Anderson gets his day in court on Nikola (NKLA). (NYT)
    • Higher Interest Rates can take a longer time to bring down inflation. (WSJ)
    •  Barron’s:
      • Positive View: + on BP XOM DECK ILMN MSGE APA PCAR TSLA KO TGT JNJ MA BAC WFC
      • Cautious View: TLT of note.
      • Mixed View: None of note.
  • Exchange/Listing/Company Reorg and Personnel News:
    • Biofrontera Inc. (BFRI) Names Fred Leffler as Chief Financial Officer.
    • Ivanhoe Electric (IE) CEO Robert Friedland to step down 11/21 but will remain Executive Chair of the Board, names Taylor Melvin as successor.
    • Mathilde Lheureux Takes the Lead of Free2move eSolutions (STLA) as New CEO.
    • Mallinckrodt Receives Approval to List on NYSE American
    • Opthea Ltd. (OPT) expands leadership team with the appointment of Timothy Morris as CFO.
  • Buyback Announcements or News: None of note.
  • Stock Splits or News: None of note.
  • Dividends Announcements or News: 
    • Middlesex Water (MSEX) increases dividend by 7.6% to $0.3125 a share.
    • Mueller Water (MWA) increases quarterly dividend by 5.2% to $0.061 per share.

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

S&P 500 +32, Dow Jones +270,  NASDAQ +68, and Russell 2000 +15. (as of 8:01 a.m. EDT)Europe higher and Asia lower ex Japan.  VIX Futures are at 29.62 from 30 yesterday morning and the VIX closed at 29.69 from 29.98 yesterday. Gold lower, Silver higher and Copper lower. WTI Crude Oil and Brent Oil Futures lower with Natural Gas lower as well. $ is lower vs Euro, lower vs Pound and higher vs Yen. US 10-year Treasury sees yields at 4.167% from 4.263% yesterday. Bitcoin is at $19,388 from $18,995 yesterday morning and is lower by -0.53% this morning.

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

  • Daily Positive Sectors: Basic Materials, Consumer Cyclical, Technology, Industrials, Financial, energy, Healthcare of note.
  • Daily Negative Sectors: None of note.
  • One Month WinnersEnergy, Basic Materials, Healthcare of note.
  • Three Month Winners:  Energy of note.
  • Six Month Winners: Energy of note.
  • Twelve Month Winners: Energy of note.
  • Year to Date Winners: Energy of note.

Options expiration day proved to be fruitful ending the week with some solid gains.  The Fed whisperer (re: Nick Timiraos of the WSJ) mentioned milder increases after a November 75 bp raise.  This was music to the Markets ears with the SPX finishing up 2.37%.  TLT still got whacked down to 93.17 closing down 1.80%.

 

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)

  • Monday After the Close: CDNS, DFS, ARE, WRB, BRO, PKG, CCK, LOGI, ZION, SSB, XM, CR, CADE, MEDP, HXL, AGNC, CALX, PCH, SSD, CATY, WSFS, NWE, IBTX, HOPE, CLS, TBI, HSTM, AAN of note.
  • Tuesday Before the Open: KO, NVS, UPS, RTX, SAP, GE, MMM, ITW, SHW, UBS, ADM, GM, VLO, MCO, CNC, BIIB, KMB, PCAR, HAL, GLW, SYF, NVR, HUBB, PHM, ARCC, CLF, PNR, GPK, ST, PII, ONB, FELE, POR, AWI, GATX, SFNC, FBP, SITC, XRX, JBLU, TRN, SSTK, SBSI of note.

Earnings of Note This Morning:

  • Beats: HNI +0.86, CBU +0.33, PHG +0.16, KEX +0.06, DORM +0.02.
  • Flat: None of note.
  • Misses: BOH (0.14).
  • Still to Report: SCHN.

Guidance:

  • Positive Guidance: None of note.
  • Negative Guidance: DORM of note.

Erlanger Research Advance/Decline Chart: 

Gap Ups & Down In Early Pre-Market:

  • Gap Up: PSO +8%, MYOV +7%, MWA +4%.
  • Gap Down: YUMC -9%, AXDX -9%, PHAT -5%, PHG -4%.

Insider Action: EVA stock sees Insider buying with dumb short selling.  No stock 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:  TSLA BABA WE Chinese Stocks PHG MYOV NOW MDT WSM . (CNBC)
  • Five Things to Know This Morning. (CNBC)
  • Five Things You Need to Know to Start Your Day. (Bloomberg)
  • Bloomberg Lead Story: Sunak wins backing of a majority of UK Conservative MPSs. (Bloomberg)
  • Bloomberg Most Read Story: Wall Street is heading out to Saudi Arabia as feud simmers. (Bloomberg)
  • More than one million Ukrainian homes have lost power. (CNBC)
  • Math and reading scores of fourth and eighth graders fell as the pandemic is still impacting learning. (NYT)
  • Schlumberger (SLB) will change name to SLB as focus shifts to Clean Tech, the symbol will not change. (Bloomberg)
  • Tesla (TSLA) shares lower as cuts price of cars in China by 3%. (CNBC)
  • Walmart (WMT) overhauls its intimates and sleepwear lines. (CNBC)
  • Oil producers are skeptical of President Biden’s vow to refill the Strategic Petroleum Reserve. (WSJ)
  • Saudi Wealth Fund is in discussion with Boeing (BA) and Airbus (EADSY) to buy 80 jets. (Bloomberg)
  • ESPN owned by Walt Disney (DIS) reaches an agreement with Formula One through 2025. (WSJ)
  • NASDAQ (NDAQ) to halt listings of smaller Chinese companies. (WSJ)

Moving Average Update:

  • Score improves to 54% from 31%.

Geopolitical: 

  • President’s Public Schedule:
    • The President departs the White House, 12:45 p.m. EDT
    • The President visits the Democratic National Committee Headquarters and delivers remarks, 1:00 p.m. EDT
    • The President arrives at the White House, 2:10 p.m. EDT
    • The President and The First Lady participate in a tree planting ceremony, 2:15 p.m. EDT
    • Press Briefing by Press Secretary Karine Jean-Pierre, 3:00 p.m. EDT
    • The President and The First Lady host a reception to celebrate Diwali; The Vice President attends, 5:00 p.m. EDT

Economic

  • Chicago Fed Activity Index 8:30 a.m. EDT
  • PMI Composite Flash 9:45 a.m. EDT

Federal Reserve / Treasury Speakers:

  • We enter a blackout period for the Fed – No speakers till Announcement.

M&A Activity:

  • Applied Genetic Technologies (AGTC) Acquired By Syncona For Up To $73.5 million.
  • Myovant Sciences (MYOV) Acquired By Sumitomo Pharma For $27 per share Or Company Value Of $2.9 billion.

Meeting & Conferences of Note:

  • Sellside Conferences:
    • None of note.
      • Previously posted and ongoing conferences:
        • None of note.
  • Company Meetings: AXAS, EC.
  • Fireside Chat: None of note.
  • Investor/Analyst Day/Calls: ARAY, IHS, SRAX
  • Update: None of note.
  • R&D Day: None of note.
  • Company Event: None of note.
  • Industry Meetings:
    • International Neurology & Brain Disorders Conference 2022 (10/24/22-10/26/22)
    • American Society for Radiation Oncology Conference
    • BIO-Europe (10/24/22-10/26/22)
    • Gartner ReimagineHR Conference USA 2022 (10/24/22-10/26/22)
    • European Conference on Computer Vision
        • Previously posted and ongoing conferences:
          • American College of Gastroenterology (ACG) Annual Scientific Meeting 2022 (10/21/22-10/26/22)
          • American Society of Anesthesiology 2022 (10/21/22-10/25/22)
          • ASRM Scientific Congress & Expo 2022 (10/22/22-10/26/22)
          • American Society of Radiation Oncology (ASTRO) 64th Annual Meeting 2022 (10/23/22-10/26/22)

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: