CAPIS Morning Note – 9/20/24: Stocks Lower But Higher For The Week, Options Expiration Ahead Today

Overnight Summary: The S&P 500 closed Thursday higher by 1.70% at 5713.64 from  Wednesday lower by -0.29% at 5618.26. The overnight high was hit at 5776.75 at 4:40 p.m. EDT and the low was hit at 5760.50 at 6:55 a.m. EDT. The overnight range is 16 points. The current price is 5763 at 7:10 a.m. EDT…

Overnight Summary: The S&P 500 closed Thursday higher by 1.70% at 5713.64 from  Wednesday lower by -0.29% at 5618.26. The overnight high was hit at 5776.75 at 4:40 p.m. EDT and the low was hit at 5760.50 at 6:55 a.m. EDT. The overnight range is 16 points. The current price is 5763 at 7:10 a.m. EDT lower by -15 points.

Most Important Article Of the Morning: With More Cuts Coming, It’s Time to Get R* by John Authers (Bloomberg)

Executive Summary: Stocks were “el fuego” yesterday as the S&P 500 was up 1.70% and cleared 5700. Today is Quadruple Witching as we have the last expiration of the third quarter. With the gap up yesterday suddenly this becomes a really interesting expiration as we could continue to advance or drop some of the gains.

  • Options Expiration for September.
  • Baker Hughes Rig Count out at 1:00 p.m. EDT.

Earnings Out After The Close: 

  • Beats:  LEN +0.26 of note.
  • Flat: 
  • Misses:  FDX -1.15, MLKN -0.04 of note.
Capital Raises:
  • IPOs For The Week: AAM, CUPR, DTSQ, FLAI, IBO, KAPA, VTRO
  • New IPOs/SPACs launched/News:
  • IPOs Filed/Priced:
    • YHNA – Closing of $60,000,000 Initial Public Offering
  • Secondaries Filed or Priced:
    • ARQ  commences public offering of shares of its common stock
    • ASND: Pricing of Public Offering of ADSs.. 2,000,000 American Depositary Shares @$150
    • BNZI: Form S-1.. Up to 25,000,000 Shares of Class A Common Stock
    • CWST Closing of Public Offering of Class A Common Stock
    • DRMA: Form S-3.. 5,871,587 Shares of Common Stock
    • SXTP: Form S-3.. Up to 8,913,044 Shares of Common Stock
  • Notes Priced:
  • Direct Offering:
  • Exchangeable Subordinate Voting Shares:
  • Selling Shareholders of note:
    • LOT  files for 44,450,000 ADS offering representing 44,450,000 ordinary shares by selling shareholder
    • CHWY commences public offering of $500 mln of shares of its Class A common stock by selling shareholder
    • FANG  files for 117,267,065 shares of common stock offering by selling shareholders
    • SMMT files for 10,352,418 shares of common stock offering by selling shareholders 
    • EVGN: Form F-1.. 3,384,616 Ordinary Shares Offered by the Selling Shareholder
  • Debt/Credit Filing and Notes:
  • Mixed Shelf Offerings:
  • PIPE:
  • Convertible Offering & Notes Filed:
  • Capital Raise Summary From The TradeXchange, bringing traders and investors real time news and Squawk Box, and other sources.

Biggest Movers Up & Down After The Close:

  • Movers Up: NKE +8.7%, EPSN+5%, CAAP +2.3%,LOT+2.1% 
  • Movers Down:FDX -10%, ARQ-8.9%, MLKN -4.3%, LEN -3.6%, UPS -2.4% 

News After The Close :

    • Amazon Web Services (AWS), an Amazon.com, Inc. company (AMZN), announced an expanded collaboration with NXP Semiconductors (NXPI) to move a majority of NXP’s electronic design automation (EDA) to AWS
    • LPLA releases monthly activity report for August 2024; Total advisory and brokerage assets increased 2.0% to $1.56 trillion, total net new assets were $6.8 bln
    • NIKE (NKE) announces that Elliott Hill will become President and CEO, effective October 14, 2024; John Donahoe will retire from his role as President and CEO and from the Board of Directors. (CNBC)
    • SBGI  increasing FY24 political advertising guidance to account for stronger-than-expected political revs 
    • M Gears Up to Hire for More Than 31,500 Seasonal Positions to Deliver Joyful Holiday Shopping Experiences
    • CAAP reports a 3.8% yr/yr decrease in passenger traffic in August; Excluding discontinuation of Natal airport, passenger traffic down 1.5%
    • AIR along with Standard Aero Inc each awarded U.S. Navy contract with estimated aggregate ceiling for both of $1.21 bln
    • 10-Q or 10-K Delays – None of note.
    • NASDAQ Delisting Notice – None of note.

Buybacks or Repurchases: Buybacks should be slow as most companies are in a blackout period as earnings season kicks into gear.

  • IRDM authorizes the repurchase of an additional $500 mln of common stock through December 31, 2027 
  • FANG approves increasing total repurchase plan to $6.0 bln from $4.0 bln

Exchange/Listing/Company Reorg and Personnel News:

    • EBAY announces appointment of William Nash, current CEO of CarMax (KMX), to its Board of Directors, effective September 18, 2024
    • NIKE (NKE) announces that Elliott Hill will become President and CEO, effective October 14, 2024; John Donahoe will retire from his role as President and CEO and from the Board of Directors

Dividends Announcements or News:

  • Stocks Ex Div Today: RCL VST IFF OMC DKS ALLE FAF MAIN PLTK ROIC LTC ALEX
  • Stocks Ex Div Tomorrow: ITUB ES WRB STX BAP NJR RWT DX
  • TXN increases dividend 5% to $1.36 a share from $1.30 a share 
  • CIM increases quarterly cash dividend to $0.37/share from $0.35/share

What’s Happening This Morning: Futures S&P 500 -14 NASDAQ 100 -70 Dow Jones -9 Russell 2000 +7. Asia is higher with Europe is lower this morning. VIX Futures are at 17.64 from 17.72 yesterday while Bonds are at 3.736% from 3.717% on the 10-Year. Crude Oil and Brent are lower with Natural Gas higher. Gold, Silver and Copper higher for a third day in a row. The U.S. Dollar is lower versus the Euro, lower versus the Pound and higher against the Yen. Bitcoin is at $63,505 from $62,905 higher by +0.18% this morning.

Sector Action – (1/3/6/12/YTD Updated Weekly with Monday release):  
  • Daily Positive Sectors: Technology, Consumer Cyclical, Materials and Industrials of note.
  • Daily Negative Sectors: Consumer Defensive and Utilities of note.
  • One Month Winners: Real Estate, Utilities, Consumer Defensive, Financials, Consumer Cyclicals and Industrials of note.
  • Three Month Winners: Real Estate, Utilities, Financials, Consumer Defensive, Healthcare and Industrials of note.
  • Six Month Winners: Utilities, Consumer Defensive, Real Estate, Technology, Financials and Communication Services of note.
  • Twelve Month Winners: Technology, Financials, Communication Services, Industrials, Utilities and Healthcare note.
  • Year to Date Winners: Technology, Utilities, Financials, Communication Services, Consumer Defensive and Healthcare of note.

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

  • Friday After the Close: 
  • Monday Before The Open: None of note

Earnings of Note This Morning:

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

Company Earnings Guidance:

  • Positive Guidance: None of note.
  • Negative or Mixed Guidance: None of note.

Advance/Decline Weekly Update With Both Daily and Weekly Stats:  Markets have improved nicely in the last week. The Daily A/D Line has made a new high while the S&P 500 just made a new high yesterday as well.

Gap Ups & Down In Early Pre-Market (+2% or down more than -2%):

  • Gap Up: NKE +6.2%, SLI +5.6%, GTE +5.4%, MASI +5%, CRSR +4.3%, EPSN +3.3%, TV +2.2%
  • Gap Down: FDX -13%, ARQ -7.6%, HAFN -5.2%, MLKN -5%, APLS -4.7%, LEN -3.6%, BNED -2.8%, UPS -2.5%, XPO -2.1%

Insider Action: JEF sees Insider buying with dumb short selling.  GTE 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.

  • What You Need To Know to Start Your Day. (Bloomberg)
  • Pre-Market Movers:  FDX CHWY DJT (CNBC)
  • Bloomberg Lead Story: What Kamala Harris Would Mean For Wall Street and Main Street. (Bloomberg)
  • Markets Wrap: See lead story. (Bloomberg)
  • FedEx disappoints. (CNBC)
  • Bloomberg: The Big Take – Harris on Housing, Taxes and Tariffs. (Podcast)

Economic:

  • Weekly Baker Hughes Rig Count is due out at 1:00 p.m. EDT.

Geopolitical:

  • President Biden receives the Daily Briefing at 10:00 a.m. EDT.
  • President Biden holds a Cabinet Meeting at 11:30 a.m. EDT
  • President Biden meets with the Prime Minister of Australia at 4:45 p.m. EDT in Delaware.

Federal Reserve Speakers: 

  • Federal Reserve Philadelphia President Patrick Harker speaks at 2:00 p.m. EDT.

M&A Activity and News:

Moving Averages On Major Indexes: Move from 90% to 100% of the moving averages being positive.

Meeting & Conferences of Note:

    • Sellside Conferences:
      • D. A. Davidson Diversified Industrials & Services Conference
      • TD Securities Chronic Urticaria Summit
      • Wolfe Research ‘Pipelines Unplugged’ Session
    • Fireside Chat: None of note.
    • Top Shareholder Meetings: BFRG, BOC, KSM, KTF, KTRA, RNW
    • Investor/Analyst Day/Calls: ALTM, MRNS, ZVRA
    • Update: None of note.
    • R&D Day: None of note.
    • FDA Presentation:
    • Company Event:
    • Industry Meetings or Events:
      • EURETINA Congress
      • European Geriatric Medicine Society (EuGMS) Congress
      • GENEWIZ Week Event
      • LABScon: The Ultimate Cybersecurity Research Conference
      • NECANN Michigan Cannabis Convention
      • Rivkin Center-AACR Biennial Ovarian Cancer Research Symposium
      • Space Education and Strategic Applications (SESA) Virtual Conference

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.

Upgrades:  FE CPB BOKF ASMB 

Downgrades: SWGAY PBF FDX DAN CMTG BURBY ACRE