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03/02/23 Briefing

The S&P 500 futures are down 23 points and are trading 0.6% below fair value. The Nasdaq 100 futures are down 125 points and are trading 1.0% below fair value. The Dow Jones Industrial Average futures are down 59 points and are trading 0.2% below fair value.

Equity futures indicate a lower open, falling under the weight of lagging mega caps, namely Apple (AAPL), Alphabet (GOOG), and Amazon.com(AMZN), which are trading lower following their earnings reports. The downside moves in the futures market have not been outsized, however, given the influence of these weighty laggards, which reflects the underlying bullishness that has persisted since the start of the year.

Separately, there is some hesitation in play this morning ahead of the January Employment Situation Report at 8:30 a.m. ETand the January ISM Non-Manufacturing Index at 10:00 a.m. ET.

Overseas economic data has generally been better than expected. China's January Caixin Services PMI was better than expected and Services PMI readings from Germany and Italy returned into expansionary territory, but readings from France and the U.K. remained below 50.0. 

The Treasury market trades in mixed fashion. The 2-yr note yield is up two basis points to 4.11% and the 10-yr note yield is down one basis point to 3.39%.

In corporate news:

  • Apple (AAPL 148.89, -1.93, -1.3%):  misses by $0.07, misses on revs as iPhones, Macs, wearables all miss expectations; expects Q2 yr/yr revenue performance to be similar to Q1

  • Amazon (AMZN 108.38, -4.53, -4.0%): reports Q4 results, beats on revs; guides Q1 revs in-line; expects organizations' optimization efforts to continue acting as a headwind to AWS growth over the next couple of quarters

  • Alphabet (GOOG 104.64, -4.16, -3.8%): misses by $0.14, reports revs in-line; google advertising revenue down 3.6%, cloud revenue up 32.7%; announces segment reporting changes; Company to meaningfully slow pace of hiring, but will still invest in priority areas such as AI

  • Nordstrom (JWN 26.65, +5.51, +26.1%): Activist investor Ryan Cohen said to be taking sizable stake in Nordstrom (JWN), according to WSJ

  • Qualcomm (QCOM 132.44, -3.41, -2.5%): beats by $0.02, misses on revs; guides Q2 EPS midpoint below consensus, revs midpoint below consensus

  • Starbucks (SBUX 106.94, -2.21, -2.0%): misses by $0.02, reports revs in-line; Q1 global comps +5%; Q1 US comps +10%; co will guide on conference call at 17:00 ET 

  • Ford Motor (F 13.38, -0.94, -6.6%): misses by $0.11, beats on revs, misses FY22 adjusted EBIT outlook; expects FY23 adjusted EBIT of $9-11 bln, mild recession in U.S. and moderate recession in Europe; downgraded to Sell from Hold at Deutsche Bank

  • Atlassian (TEAM 164.59, -17.82, -9.9%): beats by $0.16, beats on revs; guides Q3 revs in-line; guides FY23 revs above consensus

  • Gilead Sciences (GILD 85.00, +3.61, +4.4%): beats by $0.16, beats on revs; guides FY23 EPS in-line;  increases quarterly cash dividend to $0.75/share from $0.73/share

  • Cognizant Tech (CTSH 68.75, -1.91, -2.7%): downgraded to Neutral from Outperform at Robert W. Baird

  • Bill.com(BILL 100.30, -28.61, -22.2%): beats by $0.28, beats on revs; guides Q3 EPS above consensus, revs below consensus; guides FY23 EPS above consensus, revs in-line

  • Clorox (CLX 145.99, +4.99, +3.5%): beats by $0.32, beats on revs; raises FY23 EPS and revenue guidance

Reviewing overnight developments:

  • Equity indices in the Asia-Pacific region ended the week on a mostly higher note. Japan's Nikkei: +0.4% (+0.5% for the week), Hong Kong's Hang Seng: -1.4% (-4.5% for the week), China's Shanghai Composite: -0.7% (UNCH for the week), India's Sensex: +1.5% (+2.6% for the week), South Korea's Kospi: +0.5% (-0.2% for the week), Australia's ASX All Ordinaries: +0.6% (+0.8% for the week).

    • In economic data:

      • China's January Caixin Services PMI 52.9 (expected 51.6; last 48.0)

      • Japan's January Services PMI 52.3 (expected 52.4; last 51.1)

      • Hong Kong's January Manufacturing PMI 51.2 (last 49.6). December Retail Sales 1.1% yr/yr (last -4.2%) o India's January Nikkei Services PMI 57.2 (expected 58.1; last 58.5)

      • Australia's January Services PMI 48.6 (expected 48.3; last 47.3). December Home Loans -5.7% m/m (expected -2.8%; last -3.0%) and Invest Housing Finance -4.4% m/m (last -3.6%)

      • Singapore's December Retail Sales 1.3% m/m (last -3.6%); 7.4% yr/yr (last 6.5%)

    • In news:

      • Press reports from last evening indicate that a Chinese spy balloon has been spotted above Montana.

      • Hong Kong's daily entry quota and pre-arrival coronavirus testing will be scrapped, and group tours will resume on Monday.

      • Japan's Finance Minister Suzuki said that the decision on the next Bank of Japan governor has not been made yet.

      • South Korea's Finance Minister Choo said that chip exports are expected to recover in the second half of the year.

  • Major European indices are on track for a lower finish to a solid week. STOXX Europe 600: -0.1% (+0.8% week-to-date), Germany's DAX: -0.6% (+1.8% week-to-date), U.K.'s FTSE 100: +0.2% (+0.9% week-to-date), France's CAC 40: -0.2% (+0.8% week-to-date), Italy's FTSE MIB: -1.0% (+1.5% week-to-date), Spain's IBEX 35: -0.6% (+1.3% week-to-date).

    • In economic data:

      • Eurozone's December PPI 1.1% m/m (expected -0.4%; last -1.0%); 24.6% yr/yr (expected 22.5%; last 27.0%). January Services PMI 50.8 (expected 50.7; last 49.8)

      • Germany's January Services PMI 50.7 (expected 50.4; last 49.2)

      • U.K.'s January Services PMI 48.7 (expected 48.0; last 49.9)

      • France's December Industrial Production 1.1% m/m (expected 0.2%; last 2.0%). January Services PMI 49.4 (expected 49.2; last 49.5)

      • Italy's January Services PMI 51.2 (expected 51.0; last 49.9)

      • Spain's January Services PMI 52.7 (expected 52.5; last 51.6)

    • In news:

      • Services PMI readings from Germany and Italy returned into expansionary territory while reading from France and the U.K. remained below 50.0.

      • Producer prices in the eurozone increased unexpectedly in December, but the yr/yr rate still decreased to 24.6% from 27.0% in November.

      • Bank of England Governor Bailey said that it is too soon to say if yesterday's rate hike was the last.

      • Several European Central Bank policymakers spoke about the high likelihood of another 50-bps rate hike at the March meeting.

 

U.S. equity futures:

  • S&P 500 Futures: -23 @ 4,157

  • DJIA Futures: -58 @ 33,996

  • Nasdaq 100 Futures: -131 @ 12,672

Overseas:

  • Europe: DAX -0.6%, FTSE +0.2%, CAC -0.2%

  • Asia:  Nikkei +0.4%, Hang Seng -1.4%, Shanghai Composite -0.7%

Commodities:

  • Crude Oil +0.14 @ 76.02

  • Nat Gas +0.051 @ 2.507

  • Gold -1.05 @ 1929.75

  • Silver -0.080 @ 23.535

  • Copper +0.0358 @ 4.1268

 

Earnings/Guidance:

  • 2U (TWOU) beats by $0.02, reports revs in-line; guides FY23 revs in-line

  • Adtalem Global Education (ATGE) beats by $0.29, beats on revs; reaffirms FY23 EPS guidance, revs guidance

  • Alphabet (GOOG) misses by $0.14, reports revs in-line; google advertising revenue down 3.6%, cloud revenue up 32.7%; announces segment reporting changes

  • Amazon (AMZN) reports Q4 results, beats on revs; guides Q1 revs in-line; expects organizations' optimization efforts to continue acting as a headwind to AWS growth over the next couple of quarters

  • Aon (AON) beats by $0.23, reports revs in-line

  • Apple (AAPL) misses by $0.07, misses on revs as iPhones, Macs, wearables all miss expectations; expects Q2 yr/yr revenue performance to be similar to Q1

  • ArcBest (ARCB) misses by $0.08, reports revs in-line

  • Atlassian (TEAM) beats by $0.16, beats on revs; guides Q3 revs in-line; guides FY23 revs above consensus

  • Avantor (AVTR) beats by $0.02, reports revs in-line

  • Beazer Homes (BZH) beats by $0.06, misses on revs

  • Bill.com(BILL) beats by $0.28, beats on revs; guides Q3 EPS above consensus, revs below consensus; guides FY23 EPS above consensus, revs in-line

  • Boyd Gaming (BYD) beats by $0.23, beats on revs

  • Camden Property (CPT) misses by $0.01, reports revs in-line; guides Q1, FY23 FFO below consensus

  • Cboe Global Markets (CBOE) beats by $0.04, reports revs in-line; provides FY23 outlook metrics

  • Chimera Investment (CIM) guides Q4 below consensus

  • Church & Dwight (CHD) beats by $0.02, beats on revs; guides Q1 EPS below consensus, revs above consensus; guides FY23 EPS mid point below consensus, revs above consensus

  • Cigna (CI) beats by $0.09, reports revs in-line; guides FY23 EPS below consensus, revs below consensus

  • Cirrus Logic (CRUS) beats by $0.41, beats on revs; guides MarQ revs in-line

  • Clearfield (CLFD) beats by $0.02, beats on revs; guides FY23 EPS below consensus

  • Clorox (CLX) beats by $0.32, beats on revs; raises FY23 EPS and revenue guidance

  • Cognizant Tech (CTSH) misses by $0.02, beats on revs; guides Q1 revs below consensus

  • Columbia Sportswear (COLM) beats by $0.17, reports revs in-line; guides FY23 revs midpoint above consensus; declares dividend

  • CONMED (CNMD) misses by $0.48, misses on revs; guides FY23 EPS in-line, revs in-line

  • Deckers Outdoor (DECK) beats by $0.89, beats on revs; raises FY23 EPS in-line, revs in-line

  • Dolby Labs (DLB) beats by $0.32, beats on revs; guides Q2 EPS in-line, revs above consensus

  • Ensign Group (ENSG) reports EPS in-line, revs in-line; guides FY23 EPS in-line, revs above consensus

  • Exponent (EXPO) beats by $0.04, reports revs in-line; raises dividend

  • Ford Motor (F) misses by $0.11, beats on revs, misses FY22 adjusted EBIT outlook; expects FY23 adjusted EBIT of $9-11 bln, mild recession in U.S. and moderate recession in Europe

  • Gen Digital (GEN) beats by $0.02, beats on revs; guides Q4 EPS in-line, revs below estimate

  • Gilead Sciences (GILD) beats by $0.16, beats on revs; guides FY23 EPS in-line; guides total product sales above expectations

  • GoPro (GPRO) beats by $0.03, reports revs in-line

  • GrafTech International (EAF) misses by $0.05, beats on revs

  • Hartford Financial (HIG) beats by $0.44, beats on revs

  • Hub Group (HUBG) beats by $0.08, misses on revs; guides FY23 EPS in-line, revs in-line

  • Kemper (KMPR) misses by $0.42, reports revs in-line

  • Leslie's (LESL) misses by $0.01, beats on revs, comps -4.0%; reaffirms FY23 EPS guidance, revs guidance

  • LPL Financial (LPLA) misses by $0.05, beats on revs

  • LyondellBasell (LYB) beats by $0.02, misses on revs

  • Manhattan Assoc (MANH) beats by $0.31, beats on revs; guides FY23 EPS above consensus, revs above consensus

  • Methanex (MEOH) beats by $0.27, beats on revs

  • Microchip (MCHP) beats by $0.02, reports revs in-line; guides Q4 EPS above consensus, revs above consensus; declares dividend

  • MicroStrategy (MSTR) reports Q4 (Dec) results, beats on revs

  • Minerals Tech (MTX) misses by $0.52, misses on revs; announces reorganization and new segmentation for 2023

  • Mueller Water (MWA) beats by $0.05, beats on revs; reiterates FY23 guidance

  • National Fuel Gas (NFG) beats by $0.15; guides FY23 EPS in-line

  • Omega Health (OHI) beats by $0.02, misses on revs

  • Open Text (OTEX) beats by $0.18, beats on revs

  • Paylocity (PCTY) beats by $0.38, beats on revs; guides Q3 revs above consensus; guides FY23 revs above consensus

  • Post (POST) beats by $0.46, beats on revs; raises adj. EBITDA guidance for the year

  • Qualcomm (QCOM) beats by $0.02, misses on revs; guides Q2 EPS midpoint below consensus, revs midpoint below consensus

  • Regeneron Pharma (REGN) beats by $2.55, beats on revs

  • Reinsurance Group of America (RGA) misses by $0.74, beats on revs

  • Saia (SAIA) misses by $0.16, reports revs in-line

  • Sanofi (SNY) reports EPS in-line, misses on revs; guides FY23EPS in-line

  • Selective Insurance (SIGI) beats by $0.02, net premiums written increased 14%

  • Seritage Growth Properties (SRG) provides 2022 year end update

  • Skechers USA (SKX) beats by $0.11, beats on revs; guides Q1 EPS below consensus, revs below consensus; guides FY23EPS below consensus, revs below consensus

  • SkyWest (SKYW) reports Q4 (Dec) results, misses on revs

  • Standex International (SXI) beats by $0.08, beats on revs; provides MarQ guidance and FY28financial targets

  • Starbucks (SBUX) misses by $0.02, reports revs in-line; Q1 global comps +5%; Q1 US comps +10%

  • Sun Country Airlines (SNCY) beats by $0.03, beats on revs; guides Q1 revs above two analyst estimate

  • Synaptics (SYNA) misses by $0.14, misses on revs; guides MarQ revs below consensus

  • Twist Bioscience (TWST) beats by $0.43, reports revs in-line; guides Q2 revs below consensus; reaffirms FY23revs guidance; guides FY24revs above consensus

  • U.S. Steel (X) beats by $0.24, beats on revs

  • Viavi (VIAV) beats by $0.03, beats on revs; guides Q3 EPS in-line, revs in-line; approved a restructuring and workforce reduction plan

  • Virtus Investment Partners (VRTS) reports Q4 non-GAAP EPS of $5.17 vs $4.88 two analyst estimate, revs -25% yr/yr to $198.4 mln vs $173.1 mln single analyst estimate

  • World Wrestling (WWE) misses by $0.06, misses on revs; expects record revenue in 2023

  • Zimmer Biomet (ZBH) beats by $0.05, beats on revs; guides FY23EPS in-line, revs above consensus

News:

  • Large China stimulus is not likely, according to Reuters

  • US detected a Chinese spy balloon flying over Montana this week, according to the New York Times

  • 300,000 people are without power in Texas due to winter storm

  • Class 8 truck orders reached 18,400 in January, according to Act Research

  • 4D Molecular Therapeutics (FDMT) announces FDA clearance of the Investigational New Drug Application for 4D-150

  • Allete (ALE) increases quarterly dividend to $0.6775 per share from $0.65 per share

  • AmBev (ABEV) comments on brewery association accusations

  • Apartment Investment & Mgmt (AIV) announces that its Board of Directors has named R. Dary Stone as Chairman of the Board, effective February 1, 2023

  • Array Tech (ARRY) has been awarded a contract to supply solar trackers for the 130MWdc Glenrowan solar farm project, a key site for the Victorian Renewable Energy Tender 2 auction

  • Beyond Meat (BYND) aiming to reform its retail sales strategy, according to the Wall Street Journal

  • Bill.com(BILL) approves a share repurchase program with authorization to purchase up to $300 mln of BILL's common stock

  • Boeing (BA): Ukraine will receive Boeing GPS guided bombs, according to Bloomberg

  • Boston Scientific (BSX) receives FDA clearance for LithoVue Elite Single-Use Digital Flexible Ureteroscope System

  • Brookfield Asset Management (BAM) aiming to sell Florida resort for $835 million, according to the Wall Street Journal

  • Brookfield Renewable Partners (BEP) misses by $0.01, beats on revs

  • CACI Intl (CACI) successfully demonstrated its Spectral Sieve and Pit Viper low-size, weight, and power intelligence, surveillance, and reconnaissance and electronic warfare technologies for small to medium unmanned aircraft systems at the U.S. Army's Project Convergence Technology Gateway

  • Carlyle (CG) looking to hire Harvey Schwartz as CEO, according to Financial Times

  • Credit Suisse (CS) facing criminal probe over leaked accounts, according to Bloomberg

  • Farmland Partners (FPI) purchased 291 acres of farmland in Schuyler County, Illinois, for $2.16 mln

  • General Motors (GM) and Netflix (NFLX) partner to give EVs more exposure in TV shows and movies

  • Gilead Sciences (GILD) increases quarterly cash dividend to $0.75/share from $0.73/share

  • Gracell Biotechnologies (GRCL): FDA clears IND application to initiate a Phase 1b/2 clinical trial in the U.S. of GC012F; plans to initiate trial in 2Q23

  • IAC Inc. (IAC) appointed Christopher Halpin to the newly created role of Chief Operating Officer and will continue in his role as CFO

  • Invitation Homes (IVNH) increases quarterly cash dividend to $0.26 per share from $0.24 per share

  • Iteris Holdings (ITI) announces that Kerry A. Shiba will join the company as senior vice president & CFO effective February 3, 2023

  • Kohl's (KSS) appointed Tom Kingsbury as Chief Executive Officer effective Feb 2; entered into cooperation agreement with Macellum Advisors

  • Lakeland Industries (LAKE) announces appointment of Roger Shannon as CFO effective Feb. 1, 2023; current CFO Allen Dillard will continue role as COO

  • Liquidia Technologies (LQDA) announces that the PTAB has reaffirmed its original decision in the '793 IPR, which found all claims of the '793 patent to be unpatentable due to the existence of known prior art cited by Liquidia

  • Marathon Digital Holdings (MARA) reports it produced a record 687 BTC in January, 45% increase from the prior month

  • MarketAxess (MKTX) reports January volume statistics

  • Merck (MRK) KEYTRUDA plus chemotherapy met primary endpoint of progression-free survival as first-line therapy for advanced or recurrent endometrial carcinoma

  • Microchip (MCHP) increases quarterly cash dividend to $0.358/share from $0.328/share

  • NIKE (NKE) & Tiffany & Co announce partnership

  • Nordstrom (JWN): Activist investor Ryan Cohen aiming to purchase stake in Nordstrom, according to the Wall Street Journal

  • Northrop Grumman (NOC) announces that it has entered into an accelerated share repurchase agreement with Bank of America, N.A. to repurchase $500 million of Northrop Grumman's common stock

  • Palantir Technologies (PLTR) appointed COO Shyam Sankar to the new role of Chief Technology Officer and Executive Vice President

  • Parsons (PSN) awarded contract for Megaproject in Saudi Arabia

  • Silvergate Capital (SI) currently facing US investigation over FTX and Alameda dealings, according toBloomberg

  • Sterling Infrastructure (STRL) reports new awards totaling $260 mln during the fourth quarter of 2022

  • Tesla (TSLA) shipments of Chinese produced cars increased 18% last month, according to Bloomberg

  • Voya Financial (VOYA) provides year-end AUM updates

  • WEC Energy Group (WEC) will lead a pilot project at its Valley Power Plant in Milwaukee to test a new form of long-duration energy storage

  • Workhorse Group (WKHS) received a letter from Lordstown Motors (RIDE) "purporting to terminate" Intellectual Property License Agreement

  • WW (WW) discloses restructuring plans consisting of elimination of certain employees, real estate restructuring

M&A:

  • Azenta (AZTA) announces acquisition of Ziath, Ltd.; expects deal to be accretive to earnings, financial terms not disclosed

  • Broadcom (AVGO) interested in additional acquisitions, according to Financial Times

  • Constellium (CSTM) sells Ussel plant to French Investment Holding Noe Industries; terms of the transaction will remain confidential

  • FirstEnergy (FE) to sell an additional 30% ownership interest in its FET business to Brookfield for $3.5 bln

  • Gartner (IT) sells TalentNeuron to Leeds Equity Partners; financial terms were not disclosed

  • Standex International (SXI) announces sale of Procon Pumps business to Investindustrial

  • TotalEnergies SE (TTE) provides statement on its investments in India; Sells stake in renewable portfolio to Crdit Agricole Assurances

Syndicate:

  • Cellectis (CLLS) prices offering of 8.8 mln ADSs at $2.50 per ADS

  • Five Star Bancorp (FSBC) files mixed securities shelf offering

  • Johnson Controls (JCI) files mixed securities shelf offering

  • Lennar (LEN) files mixed securities shelf offering

  • Roivant Sciences (ROIV) prices offering of 26,666,666 of its common shares at $7.50 per share

  • Two Harbors Investment (TWO) priced public offering of 10 mln shares of common stock for a total expected gross proceeds of $178 mln

IPOs:

  • Priced to Trade:

    • Structure Therapeutics (Nasdaq: GPCR): The clinical stage global biopharmaceutical company aiming to develop and deliver novel oral therapeutics to treat a wide range of chronic diseases with unmet medical needs priced its 10.7 M share IPO at $15, the high end of the $13-$15 expected price range.

Gapping Up/Down

  • Gapping up:

    • MWA +8.2%, BYD +5.4%, MANH +4.5%, PCTY +4.4%, VIAV +4.3%, CLX +4.2%, MEOH +3.7%, GILD +3.5%, SNCY +3.5%, POST +3.1%, OTEX +2.8%, LQDA +2.7%, FDMT +2.4%, STRL +2.2%, SCCO +1.8%, X +1.6%, DLB +1.6%, AON +1.5%, NOC +1.4%, ROIV +1.4%, TTE +1.4%, AVTR +1.4%, PII +1.1%, CI +1.1%, KSS+0.9%

  • Gapping down:

    • HUBG -33.6%, BILL -20.3%, PFSI -13.2%, SI -12.1%, TEAM -12%, CLLS -10.7%, CLFD -9.5%, SYNA -7.8%, F -7.7%, CNMD -5.8%, AMZN -5.6%, LESL -5.3%, SKYW -5%, GOOG -4.8%, GPRO -4.8%, MSTR -4.7%, BZH -4.3%, TWO -4.2%, RGA -4.1%, QCOM -3.7%, AAPL -3.5%, SKX -3.1%, GEN -3.1%, MARA -3%, CPT -2.9%, TWOU -2.8%, ARCB -2.7%, AIV -2.6%, CRUS -2.6%, MTX -2.6%, SNY -2.5%, WKHS -2.4%, AVA -2.3%, SBUX -2.3%, QRVO -2.2%, RIDE -2.1%, NFG -2.1%, SWKS -1.9%, HIG -1.3%, CTSH -1.3%, LEN -1.1%, TSM -0.8%, AVGO -0.8%

 


Analyst Research (see Upgrades/Downgradescalendarfor full list):

  • Upgrades

    • Cardinal Health (CAH) upgraded to Outperform from Neutral at Robert W. Baird; tgt raised to $94

    • Erasca (ERAS) upgraded to Overweight from Equal-Weight at Morgan Stanley; tgt $15

    • Esperion Therapeutics (ESPR) upgraded to Equal-Weight from Underweight at Morgan Stanley; tgt $9

    • H.B. Fuller (FUL) upgraded to Buy from Neutral at Citigroup; tgt raised to $85

    • Inditex (IDEXY) upgraded to Hold from Sell at Deutsche Bank

    • Int'l Paper (IP) upgraded to Neutral from Sell at UBS; tgt raised to $43

    • Meta Platforms (META) upgraded to Hold from Sell at DZ Bank; tgt $180

    • Neurocrine Biosciences (NBIX) upgraded to Overweight from Equal-Weight at Morgan Stanley; tgt raised to $130

    • Nordstrom (JWN) upgraded to Hold from Reduce at Gordon Haskett; tgt $22

    • Sallie Mae (SLM) downgraded to Equal Weight from Overweight at Wells Fargo; tgt lowered to $16

  • Downgrades:

    • Aptiv (APTV) downgraded to Peer Perform from Outperform at Wolfe Research

    • Bill.com(BILL) downgraded to Market Perform from Outperform at BMO Capital Markets; tgt lowered to $128

    • Boeing (BA) downgraded to Sector Perform from Outperform at RBC Capital Mkts; tgt $225

    • C.H. Robinson (CHRW) downgraded to Hold from Buy at Stifel; tgt lowered to $99

    • Camden Property (CPT) downgraded to Neutral from Overweight at Piper Sandler; tgt $136

    • Cognizant Tech (CTSH) downgraded to Neutral from Outperform at Robert W. Baird; tgt raised to $68

    • First Foundation (FFWM) downgraded to Neutral from Overweight at Piper Sandler; tgt lowered to $16

    • Focus Financial (FOCS) downgraded to Market Perform from Outperform at BMO Capital Markets; tgt lowered to $53

    • Ford Motor (F) downgraded to Sell from Hold at Deutsche Bank; tgt lowered to $11

    • Generac (GNRC) downgraded to Neutral from Buy at Guggenheim

    • Hexcel (HXL) downgraded to Neutral from Buy at BofA Securities; tgt lowered to $70

    • Hilton Grand Vacations (HGV) downgraded to Hold from Buy at Jefferies; tgt lowered to $52

    • ImaRx Therapeutics (IMRX) downgraded to Underweight from Equal-Weight at Morgan Stanley; tgt lowered to $5

    • Kuehne & Nagel International (KHNGY) downgraded to Hold from Buy at Stifel

    • Lightspeed (LSPD) downgraded to Neutral from Sector Outperform at CIBC

    • Meta Platforms (META) downgraded to Reduce from Hold at HSBC Securities; tgt $110

    • Repare Therapeutics (RPTX) downgraded to Equal-Weight from Overweight at Morgan Stanley; tgt lowered to $15

    • Spirit Aerosystems (SPR) downgraded to Sector Perform from Outperform at RBC Capital Mkts; tgt lowered to $36

    • Travel + Leisure Co (TNL) downgraded to Hold from Buy at Jefferies; tgt lowered to $49

    • Upstart (UPST) downgraded to Hold from Buy at Loop Capital; tgt $24

  • Others:

    • Agios Pharma (AGIO) initiated with an Overweight at Piper Sandler; tgt $41

    • C3.ai (AI) initiated with a Buy at DA Davidson; tgt $30

    • Day One Biopharmaceuticals (DAWN) initiated with a Perform at Oppenheimer

    • Herbalife Nutrition (HLF) initiated with an Underperform at BofA Securities; tgt $14

    • Privia Health (PRVA) initiated with a Buy at Goldman; tgt $32

    • Relay Therapeutics (RLAY) initiated with an Outperform at Oppenheimer; tgt $33

    • Tyra Biosciences (TYRA) initiated with an Outperform at Oppenheimer; tgt $17

Upcoming Events:

  • Econ Data:

    • 08:30 ET: Nonfarm payrolls for Jan (Briefing.comConsensus 190K; Prior 223K)

    • 08:30 ET: Nonfarm private payrolls for Jan (Briefing.comConsensus 175K; Prior 220K)

    • 08:30 ET: Unemployment Rate for Jan (Briefing.comConsensus 3.6%; Prior 3.5%)

    • 08:30 ET: Avg. Hourly Earnings for Jan (Briefing.comConsensus 0.3%; Prior 0.3%)

    • 08:30 ET: Average Workweek for Jan (Briefing.com Consensus 34.4; Prior 34.3)

    • 09:45 ET: IHS Markit Services PMI - Final for Jan (Briefing.comConsensus NA; Prior 46.6)

    • 10:00 ET: ISM Non-Manufacturing Index for Jan (Briefing.comConsensus 50.3%; Prior 49.6%)

  • Earnings:

    • Monday (Jan 30)

      • Morning:  BEN GEHC PHG SOFI

      • Afternoon: AGNC ARE CADE ELS GGG HLIT HTLF HP JJSF NXPI PCH PFG SANM WHR WWD

    • Tuesday (Jan 31)

      • Morning: AOS ALGM CAT CVLT GLW DOV AQUA XOM GM HUBB IMO IP KEX LII MAN MPC MCD MDC MCO MPLX MSCI NYCB NVR PNR PFE PSX PBI PII PHM ST SPOT SYY UBS UPS

      • Afternoon:  AMD DOX AMGN APAM ASH BXP CP CB CACC EW EA HA IEX JNPR MTCH MRCY MDLZ NATI OI RNR SNAP SYK SMCI UNM VREX WDC

    • Wednesday (Feb 1)

      • Morning:  MO ABC ATKR BSX EAT GIB CMCO DT EPD EVR FTV HUM JCI NVS ODFL OTIS PTON SMG SLAB SR TMUS TMO TGI WM WRK

      • Afternoon:  EGHT AFL ALGN ALGT ALL AFG AVT BHE BDN CHRW CCS CHX CLB CTVA DXC ELF ENVA GL THG HOLX KRC KLIC LSTR LFUS MXL MCK MTH META MET MTG MAA MUSA NTGR PTC QRVO RYN RRX SLM SITM TTEK TBI UGI VSTO

Asia & Europe detail:

Asia: Nikkei +0.4%, Hang Seng -1.4%, Shanghai Composite -0.7%

Equity indices in the Asia-Pacific region ended the week on a mostly higher note. Press reports from last evening indicate that a Chinese spy balloon has been spotted above Montana. Hong Kong's daily entry quota and pre-arrival coronavirus testing will be scrapped, and group tours will resume on Monday. Japan's Finance Minister Suzuki said that the decision on the next Bank of Japan governor has not been made yet. South Korea's Finance Minister Choo said that chip exports are expected to recover in the second half of the year.

  • In economic data:

    • China's January Caixin Services PMI 52.9 (expected 51.6; last 48.0)

    • Japan's January Services PMI 52.3 (expected 52.4; last 51.1)

    • Hong Kong's January Manufacturing PMI 51.2 (last 49.6). December Retail Sales 1.1% yr/yr (last -4.2%) o India's January Nikkei Services PMI 57.2 (expected 58.1; last 58.5)

    • Australia's January Services PMI 48.6 (expected 48.3; last 47.3). December Home Loans -5.7% m/m (expected -2.8%; last -3.0%) and Invest Housing Finance -4.4% m/m (last -3.6%)

    • Singapore's December Retail Sales 1.3% m/m (last -3.6%); 7.4% yr/yr (last 6.5%)

---Equity Markets---

  • Japan's Nikkei: +0.4% (+0.5% for the week)

  • Hong Kong's Hang Seng: -1.4% (-4.5% for the week)

  • China's Shanghai Composite: -0.7% (UNCH for the week)

  • India's Sensex: +1.5% (+2.6% for the week)

  • South Korea's Kospi: +0.5% (-0.2% for the week)

  • Australia's ASX All Ordinaries: +0.6% (+0.8% for the week)

---FX---

  • USD/JPY: -0.2% to 128.41

  • USD/CNH: +0.1% to 6.7424

  • USD/INR: -0.2% to 81.84

 

Europe: DAX -0.6%, FTSE +0.2%, CAC -0.2%

Major European indices are on track for a lower finish to a solid week. Services PMI readings from Germany and Italy returned into expansionary territory while reading from France and the U.K. remained below 50.0. Producer prices in the eurozone increased unexpectedly in December, but the yr/yr rate still decreased to 24.6% from 27.0% in November. Bank of England Governor Bailey said that it is too soon to say if yesterday's rate hike was the last. Several European Central Bank policymakers spoke about the high likelihood of another 50-bps rate hike at the March meeting.

  • In economic data:

    • Eurozone's December PPI 1.1% m/m (expected -0.4%; last -1.0%); 24.6% yr/yr (expected 22.5%; last 27.0%). January Services PMI 50.8 (expected 50.7; last 49.8)

    • Germany's January Services PMI 50.7 (expected 50.4; last 49.2)

    • U.K.'s January Services PMI 48.7 (expected 48.0; last 49.9)

    • France's December Industrial Production 1.1% m/m (expected 0.2%; last 2.0%). January Services PMI 49.4 (expected 49.2; last 49.5)

    • Italy's January Services PMI 51.2 (expected 51.0; last 49.9)

    • Spain's January Services PMI 52.7 (expected 52.5; last 51.6)

---Equity Markets---

  • STOXX Europe 600: -0.1% (+0.8% week-to-date)

  • Germany's DAX: -0.6% (+1.8% week-to-date)

  • U.K.'s FTSE 100: +0.2% (+0.9% week-to-date)

  • France's CAC 40: -0.2% (+0.8% week-to-date)

  • Italy's FTSE MIB: -1.0% (+1.5% week-to-date)

  • Spain's IBEX 35: -0.6% (+1.3% week-to-date)

---FX---

  • EUR/USD: +0.2% to 1.0929

  • GBP/USD: +0.3% to 1.2261

  • USD/CHF: UNCH at 0.9132


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