CAPIS Morning Note – 7/28/22: Tech Mega Caps Apple and Amazon Report After The Close. Indexes Mixed.

Overnight Summary: The S&P 500 closed Wednesday at 4023.61 (higher by 2.62%) from 3921.05 on Tuesday (lower by -1.15%).  Futures are trading lower in the premarket session. The overnight high of 4024 was hit at 4:25 p.m. EDT. The low was hit at 4004 at 5:25 a.m. EDT, a range of 20 points high to low…

Overnight Summary: The S&P 500 closed Wednesday at 4023.61 (higher by 2.62%) from 3921.05 on Tuesday (lower by -1.15%).  Futures are trading lower in the premarket session. The overnight high of 4024 was hit at 4:25 p.m. EDT. The low was hit at 4004 at 5:25 a.m. EDT, a range of 20 points high to low which is below the range of late with 45 the average range. At 7:45 a.m. EDT the current price is 4015 which is -0.23% and -11 points. 

Breaking News: Jet Blue (JBLU) and Spirit Airlines (SAVE) agree to merge one day after Spirit cancels deal with Frontier. (CNBC)

Earnings Out After The Close:

  • Beats: EQIX +2.53 MUSA  +2.32 RE +1.68  LRCX +1.50 URI +1.41 CSL +1.16 SNBR +0.92  MTH +0.90 CHRW +0.68 VSTO +0.41 PPC +0.38 MKSI +0.28 HOLX +0.25 F+0.24 FWRD +0.21 ETSY +0.19 MMSI +0.15.
  • Flat: None of note.
  • Misses: MEOH -0.57 PEGA -0.43 CINF -0.39 CAKE -0.25 ALGN -0.23 ORLY -0.21 OMF -0.10 META -0.09 RJF -0.07 OII -0.05.

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:
    • GWRS: Proposed Public Offering of Common Stock.. Roth bookmanager.
    • JWEL: Filed Form F-3/A Upsizes offering.
    • Lexicon Pharma (LXRX) Proposed Public Offering Of Common Stock.. Citi and Piper bookmanagers.
    • WORX: Filed Form S-1.. 2,288,585 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):
    • TBLT: Closing of $20 Million Private Placement Priced at a Premium to Market under Nasdaq Rules.
  • Mixed Shelf Offerings:
    • Element Solutions (ESI) files mixed shelf.
    • Hubbell (HUBB) files mixed shelf.
    • ELTK: Filed Form F-3.. $20,000,000 Mixed Shelf.
  • Debt Filing: 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: ETSY +12%, PI +9%, NTGR +7%, MUSA +6%, URI +6%, SNBR +6%, F +5%, PLXS +5%, LC +4%.
    • Trading Down:CYH -41%, COUR -23%, TDOC -15%, COLM -9%, EGHT -5%, NOW -5%, QCOM -4% .
  • News Since The Close:
    • Spirit (SAVE) terminates deal with Frontier (ULCC).
    • Doubleline Bond PM Jeffrey Gundlach says Fed is getting to end of its rate increases.
    • Senator Joe Manchin (D-WV) to vote for Inflation Reduction Act.
    • Abbvie’s (ABBV) Allergan unit to pay $2 billion to settle opioid lawsuit. (Bloomberg)
  • Exchange/Listing/Company Reorg and Personnel News:
    • Fortis (FTS): Douglas Haughey stepping down as Chair of the Board, to be replaced by Jo Mark Zurel.
    • Founder SPAC (FOUN) plans to transfer listing to NYSE in connection with its proposed business combination with Rubicon Technologies.
    • Honeywell (HON) names Vimal Kapur as COO.
    • Lending Club (LC) names Drew LaBenne CFO on 9/1 as current CFO retiring.
  • Buyback Announcements or News:
    • TechnipFMC (FTI) to repurchase $400 million shares.
    • Northeast Community Bancorp (NECB) authorizes up to 10% of outstanding shares.
    • Shell (SHEL) announces commencement of a share buyback program.
  • Stock Splits or News:  None of note.
  • Dividends Announcements or News: 
    • Armada Hoffler Properties (AHH) increases quarterly cash dividend $0.02 to $0.19 per share.
    • OFG Bancorp (OFG) raised dividend by $0.05 to $2o.
    • Amalgamated Bank (AMAL) ups dividend to $0.10 from $0.08.
    • Charles Schwab (SCHW) ups dividend to $0.22 from $0.20. Up repurchase up to $15 billion in stock.
    • Ford (F) ups dividend to $0.15 a 50% increase.

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

S&P 500 -11, Dow Jones -42, NASDAQ -84, and Russell 2000 +0.56. Europe lower ex France and Asia higher ex Hong Kong.  VIX Futures are at 24.90 from 25.35 yesterday morning and the VIX closed at 23.24 from 24.69  yesterday. Gold,  Silver and Copper higher. WTI Crude Oil  and Brent Oil Futures higher and Natural Gas higher. $ is higher vs Euro, higher vs Pound and lower vs Yen. US 10 year Treasury sees yields at 2.789% from 2.798% yesterday morning. Bitcoin is at $22,994 from $21,289 yesterday morning and is higher by 0.90% this morning. As of 7:57 a.m. EDT.

Sector Action – 07/27/22 Close (1/3/6/12/YTD Updated Weekly with Monday release):  

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

Market on steroids after the Federal Reserve signaled it would move aggressively to tame inflation and economy is not in a recession.  NASDAQ was up 4.06%, its largest single day gain in 2 years.  Updated 07/27/22 close.

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

  • Thursday After the Close: AAPL, AMZN, INTC, EW, KLAC, LHX, DLR, AJG, DXCM, SGEN, MTD, EIX, CLR, HIG, AVTR, VRSN, YUMC, VFC, BIO, WFG, GLPI, CE, EMN, ROKU, TFII, ZEN, MHK, FSLR, DECK, DLB, OLN, CACC, FIVN, ATR, SSB, CRSP, SHLX, TXRH, X, ROG, WWE, EXPO, AUY, CUZ, NATI, CWST, OFC, ULCC, MTX, MGRC, WRE, HTGC, OPK, LTC, LGND, UCTT, TVTX, COHU, HURN, INFN, CDNA, PRO, EIG, ENVA, SKYW, LMAT, IMAX, MERC, TWOU, DRQ, RGP, BZH, MITK, EHTH of note.
  • Friday Before the Open: XOM, PG, CVX, ABBV, AZN, CHTR, ENB, CL, AON, PSX, IMO, LYB, WY, GWW, CHD, MGA, CNHI, WPC, CBOE, BAH, NWL, CPRI, GTLS, AB, CRI, FHB, ABR, NMRK, PIPR, ARCB, PFS, B, BLMN, ECVT, IMGN, AXL, SLCA, WETF of note.

Earnings of Note This Morning:

  • Beats: PBF +3.26 VLO +2.16 VC +0.86  TMO +0.53 HOG +0.41 LH +0.28 SO +0.23.
  • Flat: None of note.
  • Misses: TROW -0.36 SWK -0.36 FCN -0.24 OSTK -0.23 DTE -0.11.
  • Still to Report:  BUD BAX BEN KDP MA RCL SNDR WING.

Guidance:

  • Positive Guidance: EDU, HUM, AVY, GPC, ROK, SLAB, ADP, DRVN, WM, EXTR, ALKS, OPCH, R, APH, FBHS, LRCX, HOLX, SPSC, FLEX, URI, NTGR, FWRD, PI, PLXS, GFL, STM, POR, EXLS,  of note.
  • Negative Guidance: IART, BSX, TPX, BMY, TDY, GRMN, SHW, FORM, GSHD, SNBR, CTSH, QCOM, META, TDOC, AMED, COUR, BOOT, COLM, CHE, SSNC, ORLY, TYL, EGHT, CYH, CNMD, SLM, JBT, CASH, LC, CLB, EEFT, ALLE, SWK, WST, BC, LIN of note.

Erlanger Research Advance/Decline Chart: Updated through 07/27/22 close.

Gap Ups & Down In Early Pre-Market:

  • Gap Up: NOVA +15%, PI +12%, RUN +11%, FSLR +9%, ARGX +9%, SPWR +8%, NTGR +7%, ETSY +6%, PBF +6%, MYOV +6%, MMSI +6%, F +5%, SEDG +5%, MAA +5%, PLXS +5%, AEM +5%, ESI +5%, SAVE +5%, AGI +5%, LXU +4%, CVE +4%, WFRD +4%, TMO +4%, CSIQ +4%, ENPH +4%, CHRW +4%.
  • Gap Down: CYH -50%, COUR -33%, TDOC -25%, LXRX -20%, FORM -17%, SWK -15%, FMS -13%, SNN -11%, PEGA -9%, CNMD -8%, NOW -7%, PTC -6%, NDLS -6%, BUD -6%, DVA -5%, META -5%, SNBR -5%, OSTK -5%, CCS -5%, SPSC -5%, BBY -4%, CTSH -4%, ORLY -4%, QS -4%, MEOH -4%, OMF -4%, BCS -4%, ORAN -4%, TTE -4%.

Insider Action: No stock sees Insider buying with dumb short selling.  No stock sees Insider buying with smart short sellers. 07/27/22 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: SWK, SAVE, HOG, CMCSA, LUV, META, F, QCOM, BBY, ETSY, TDOC. (CNBC)
  • Five Things You Need to Know to Start Your Day (Bloomberg)
  • 5 things to know before the stock market opens on Thursday. (CNBC)
  • Bloomberg Lead Story:  Schumer, Manchin Resurrect Deal Left For Dead. (Bloomberg)
  • Bloomberg Most Read Story: Rockstar Games Cleaned up Frat Boy Culture and Grand Theft Auto as well. (Bloomberg)
  • Senator Kyrsten Sinema (D-AZ) has yet to announce her vote on the Reconciliation Bill. (Axios)
  • Senate Reconciliation Bill includes a $4000 tax credit on used electric vehicles. (Reuters)
  • Lab Corp (LH) to spin of Clinical Drug Unit. (WSJ)
  • Rivian (RIVN) to eliminate 6% of workforce. (Bloomberg)
  • FAA mishandled oversight on Southwest (LUV). (WSJ)
  • Comcast (CMCSA) fails to add subscribers for the first time ever. (CNBC)
  • Robinhood Snacks looks at Fanatics deal with “Stranger Things” as expands into pop culture.

Moving Average Update:

  • Score jumps to 80% from 51%.  Updated 07/27/22 close.

Geopolitical: 

  • President’s Public Schedule:
    • President Biden to speak with Chinese President Xi at 8:30 a.m. EDT.
    • The President receives the President’s Daily Briefing, 9:30 a.m. EDT
    • The President delivers remarks on the economy and meets with CEOs to receive an update on economic conditions across key sectors and industries; The Secretary of the Treasury, Secretary of Commerce, and Chair of the Council of Economic Advisers attend, 2:15 p.m. EDT
    • Press Briefing by Press Secretary Karine Jean-Pierre, 3:15 p.m. EDT

Economic

  • Q2 GDP is due out at 8:30 a.m. EDT and expected to come in at 0.5% from -1.6%.
  • Initial Jobless Claims 8:30 a.m. EDT
  • EIA Natural Gas Report 10:30 a.m. EDT
  • KC Mfg Index 11:00 a.m. EDT

Federal Reserve / Treasury Speakers:

  • None of note.

M&A Activity:

  • ArcelorMittal (MT) acquires CSP in Brazile of $2.2 billion.
  • Vista Outdoor (VSTO) buys Simms Fishing Products for $192.50 million.

Meeting & Conferences of Note:

  • Sellside Conferences:
    • None of note. 
      • Previously posted and ongoing conferences:
        • JP Morgan Latam & Ceemea Smid Cap Opportunities Conference.
        • SVB Securities Big Data, A.I. & Machine Learning in Healthcare. (07/25/22-07/30/22)
  • Company Meetings: ATHX, RCRT.
  • Fireside Chat:
    • Evolution Petroleum (EPM) Fireside Chat with Water Tower Research.
    • Ford (F) Execs to Discuss Ford+ Plan, Q2 Results, 2022 Outlook During July 28 Fireside Chat with BNP Paribas Exane Analyst.
  • Investor/Analyst Day/Calls: BRFH, BTTX, REE.
  • Update:
    • The Charles Schwab Corporation (SCHW) Business Update.
  • R&D Day: None of note.
  • Company Event:
    • Citigroup (C) Second Quarter Fixed Income Investor Review 2022.
    • Cisco (CSCO) and Jefferies (JEF): Webcast on Human Capital Management.
  • Industry Meetings:
    • World Tuberous Sclerosis Complex (TSC) Conference 2022 (07/28/22-07/31/22)
    • 30th Annual NNPDF Family Support & Medical Conference 2022 (07/28/22-08/01/22)
    • Yale University SalivaDirect Conference 2022 (07/28/22-07/29/22)
    • American Podiatric Medical Association Conference 2022 (07/28/22-07/31/22)
      • Previously posted and ongoing conferences:
        • Suppliers Partnership for the Environment (SP) Innovation Summit 2022 (07/27/22-07/28/22)
        • OTC Metals and Mining Virtual Conference 2022 (07/27/22-07/28/22)
        • Florida International Medical Expo (FIME) 2022 (07/27/22-07/29/22)
        • B & T Cell-Mediated Autoimmune Disease Drug Development Summit (07/26/22-07/28/22)
        • NIIMBL 2022 National Meeting (07/26/22-07/28/22)
        • Mining Disrupt Conference 2022 (07/26/22-07/28/22)
        • Basic Cardiovascular Sciences (BCVS) Scientific Sessions 2022 (07/25/22-07/28/22)
        • Federation of Defense & Corporate Counsel (FDCC) Annual Meeting 2022 (07/23/22-07/30/22)
        • American Association for Clinical Chemistry (AACC) Annual Scientific Meeting and Clinical Lab Exposition 2022 (07/24/22-07/28/22)
        • The 24th International Symposium on the Photochemistry and Photophysics of Coordination Compounds 2022 (07/24/22-07/29/22)

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: