Search

19/04/22 Briefing


The S&P 500 futures trade four points, or 0.1%, above fair value as investors continue to show a lack of conviction. Buying interest has been restrained by a lackluster response to earnings news, hawkish-sounding Fed commentary, and upwards pressure in long-term interest rates.

Starting with earnings, Dow components Johnson & Johnson (JNJ 176.95, -0.71, -0.4%) and Travelers (TRV 181.75, -3.47, -1.9%) are both trading lower in pre-market action despite beating EPS estimates, but to be fair, JNJ also lowered its FY22 EPS guidance below consensus.

In Fedspeak, St. Louis Fed President Bullard (FOMC voter) said in a speech yesterday that he wants rates to go to 3.5% by end of the year and that the Fed shouldn't rule out the use of 75-basis-point rate increases, according to Bloomberg. As a reminder, the Fed's next policy meeting is in two weeks.

The 10-yr Treasury note yield continues to head toward 3.00%, topping 2.90% overnight. Right now, the benchmark yield is up three basis points to 2.89% while the 2-yr yield trades unchanged at 2.47%. The U.S. Dollar Index is up 0.1% to 100.92. WTI crude futures are down 1.2%, or $1.34, to $106.87/bbl.

On the data front, investors will receive Housing Starts (Briefing.comconsensus 1.750 million) at Building Permits (Briefing.comconsensus 1.840 million) for March at 8:30 a.m. ET.

In U.S. Corporate news:

  • Johnson & Johnson (JNJ 176.95, -0.71): -0.4% after lowering its FY22 EPS guidance below consensus. JNJ beat EPS estimates.

  • Travelers (TRV 181.75, -3.47): -1.9% despite beating top and bottom-line estimates. TRV also raised its quarterly dividend by 6%.

  • Lockheed Martin (LMT 460.06, -7.38): -1.6% after reporting mixed earnings results, beating EPS estimates on below-consensus revenue.

  • J.B. Hunt Transport (JBHT 174.99, +3.54): +2.1% after beating top and bottom-line estimates.

  • American Campus Communities (ACC 65.00, +7.42): +12.9% after agreeing to be acquired by Blackstone (BX 112.73, +0.74, +0.7%) in a $12.8 billion deal, according to The Wall Street Journal.

Reviewing overnight developments:

  • Equity indices in the Asia-Pacific region ended Tuesday on a mixed note. Japan's Nikkei: +0.7% Hong Kong's Hang Seng: -2.3% China's Shanghai Composite: -0.1% India's Sensex: -1.2% South Korea's Kospi: +1.0% Australia's ASX All Ordinaries: +0.6%.

  • In economic data:

  • Japan's February Industrial Production 2.0% m/m (last 0.1%) and Capacity Utilization 1.5% m/m (last -3.6%)

  • Australia's March New Home Sales 3.9% m/m (last -7.0%)


  • In news:

  • Toyota expects that global production between May and July will average about 800,000 units per month, down from a recent rate of 840,000 per month.

  • Chinese lenders are reportedly being encouraged to cut deposit rates.

  • Xinhua speculated that China's CPI will only grow "modestly" in Q2 and Q3.

  • The Minutes from the last Reserve Bank of Australia policy meeting noted that certain developments have pulled forward the timing of the initial rate hike.

  • The Japanese yen has weakened to a 20-year low against the dollar.



  • Major European indices trade in the red while European debt also trades lower. STOXX Europe 600: -1.2% Germany's DAX: -0.8% U.K.'s FTSE 100: -0.4% France's CAC 40: -1.0% Italy's FTSE MIB: -1.6% Spain's IBEX 35: -1.7%.

  • There was no notable economic data

  • In news:

  • French Finance Minister Le Maire said that an embargo on Russian oil is in the works.

  • Stellantis will suspend its operations in Russia.

  • British energy suppliers expect that the number of customers looking to pay their bills over time will increase by about 50% this year.



U.S. equity futures:

  • S&P 500 Futures: +2 @ 4,393

  • DJIA Futures: +14 @ 34,426

  • Nasdaq 100 Futures: +5 @ 13,916

Overseas:

  • Europe: DAX -0.8%, FTSE -0.4%, CAC -1.0%

  • Asia: Nikkei +0.7%, Hang Seng -2.3%, Shanghai Composite -0.1%

Commodities:

  • Crude Oil -1.45 @ 106.16

  • Nat Gas -0.386 @ 7.434

  • Gold -3.95 @ 1982.45

  • Silver -0.033 @ 26.117

  • Copper -0.0555 @ 4.7465

U.S. Summary:

  • Earnings/Guidance (Full Earnings Calendar):

  • Citizens Financial Group (CFG) beats by $0.16, reports revs in-line

  • Commerce Bancshares (CBSH) beats by $0.09, misses on revs

  • Equity Lifestyle Properties (ELS) beats by $0.02, beats on revs; guides Q2 FFO in-line; guides FY22 FFO in-line

  • Fifth Third (FITB) misses by $0.01

  • F.N.B. Corp (FNB) beats by $0.02, reports revs in-line

  • Genmab (GMAB) announces Q1 net sales of DARZALEX (daratumumab)

  • Halliburton (HAL) beats by $0.01, beats on revs

  • Hasbro (HAS) misses by $0.07, reports revs in-line; reaffirms FY22 revenue guidance; increases dividend 3%

  • Hope Bancorp (HOPE) beats by $0.11, beats on revs

  • Iridium Communications (IRDM) beats by $0.02, beats on revs; reaffirms FY22 service revenue guidance

  • J.B. Hunt Transport (JBHT) beats by $0.35, beats on revs

  • Johnson & Johnson (JNJ) beats by $0.10, reports revs in-line; lowers FY22 EPS below consensus, reaffirms FY22 revs guidance

  • Lockheed Martin (LMT) beats by $0.25, misses on revs; reaffirms FY22 EPS guidance, revs guidance

  • Manpower (MAN) beats by $0.09, beats on revs; guides Q2 EPS above consensus

  • National Bank (NBHC) reports EPS in-line, misses on revs

  • National Health (NHI) provides FY22 FFO guidance; approves stock repurchase plan for up to $240 mln

  • NETGEAR (NTGR) issues downside Q1 revenue guidance due to decline in U.S. consumer WiFi market

  • Nu Skin (NUS) provides outlook for 2025

  • Pinnacle Finl (PNFP) beats by $0.08, misses on revs

  • PNM Resources (PNM) reaffirms FY22/FY23guidance

  • Quipt Home Medical (QIPT) acquired Good Night Medical for approx. $7 mln in cash; reiterates calendar end 2022 outlook (fiscal Q1 2023)

  • Signature Bank (SBNY) beats by $1.00

  • Silvergate Capital (SI) beats by $0.32

  • Super Micro Computer (SMCI) raises Q3 EPS and revenue guidance above consensus

  • Travelers (TRV) beats by $0.60, beats on revs; raises dividend

  • Truist (TFC) beats by $0.12, misses on revs


  • General News:

  • Russian offensive in the eastern portion of Ukraine has started, according to the New York Times

  • Saint Louis Fed President James Bullard (voting FOMC member) wants rates to go to 3.5% by end of this year and says Fed shouldn't rule out use of 75 basis point increases, according to Bloomberg

  • All major US airlines drop mask requirements on planes following ruling from federal judge in Florida; Biden administration officials say CDC mask rule for planes and other public transit is no longer in effect following ruling

  • Acadia Pharmaceuticals (ACAD) announces top-line results from Phase 2 study of ACP-044 as treatment for acute postoperative pain; primary endpoint not met

  • Adicet Bio (ACET) receives FDA Fast Track Designation for lead candidate ADI-001

  • Alkermes (ALKS) commences binding arbitration proceedings with Johnson & Johnson's (JNJ) Janssen

  • Alta Equipment Group (ALTG) appoints Craig Brubaker as COO, effective immediately

  • Amazon (AMZN) working on new AR smart home product, according to Verge

  • Amazon (AMZN) warehouse in New Jersey will vote on union, according to the Washington Post

  • Amgen (AMGN) announces top-line results from Phase 3 study of ABP 654

  • Archer Aviation (ACHR) appoints Adam Goldstein as sole CEO

  • Ashford (AINC) agreed with Jeremy Welter, the Chief Operating Officer of the Company, that, effective July 15, 2022, Mr. Welter would terminate employment

  • AstraZeneca (AZN) receives Priority Review in US for ENHERTU

  • Axsome Therapeutics (AXSM) has received and agreed to Postmarketing Requirements/Commitments proposed by the FDA with respect to the New Drug Application for its AXS-05 product candidate for the treatment of major depressive disorder

  • BeiGene (BGNE) presents updated results from Phase 3 RATIONALE-309 Trial of PD-1 inhibitor tislelizumab in first-line RM-NPC; secondary survival endpoint findings were consistent with interim analysis

  • BioXcel Therapeutics (BTAI) announce strategic financing agreements by Oaktree Capital Management, L.P. and Qatar Investment Authority

  • BioXcel Therapeutics (BTAI) announces the formation of wholly-owned subsidiary OnkosXcel Therapeutics, Inc. to develop transformative medicines in oncology

  • Chevron (CVX) and union reject proposals, according to Reuters

  • China Eastern Airlines (CEA) provides operations updates; March capacity (measured by available seat-kilometres) decreased by 62.35% yr/yr

  • Delta (DAL) tests Starlink internet on jets, according to the Wall Street Journal

  • Eagle Pharma (EGRX) reached a settlement agreement with Pfizer's (PFE) Hospira

  • Genetron (GTH) receives CE Mark for Human B Lymphocyte Minimal Residual Disease Detection Kit Seq-MRD

  • GlaxoSmithKline (GSK) receives acceptance of NDA for daprodustat from FDA

  • Hut 8 Mining (HUT) to purchase 960 MicroBT Whatsminer M31S+ effective May 1, 2022

  • Johnson & Johnson (JNJ) increases quarterly dividend to $1.13 per share from $1.06 per share

  • Microvast (MVST) announced that Craig Webster has been appointed as the Company's new Chief Financial Officer, effective as of April 14, 2022

  • Novavax (NVAX) announces that its partner, Takeda (TAK), received manufacturing and marketing approval from the Japan Ministry of Health, Labour and Welfare for its Nuvaxovid Intramuscular Injection

  • Pearson Plc (PSO) announces that its Online Program Management partnership with Arizona State University will end in June 2023 and reiterates existing Group financial guidance

  • Pebblebrook Hotel Trust (PEB) details operating trends - continued to improve substantially

  • Plug Power (PLUG) to supply Walmart with green hydrogen to fuel retailer's fleet of material handling lift trucks

  • Retractable Technologies (RVP) terminates share buyback plan

  • Rollins (ROL) settles with SEC

  • SpringWorks Therapeutics (SWTX) entered into a clinical trial collaboration and supply agreement with Regeneron Pharmaceuticals (REGN)

  • Stellantis (STLA) suspends production in Russia

  • Takeda Pharma (TAK) receives approval for Nuvaxovid COVID-19 Vaccine in Japan

  • Uber (UBER) says riders and drivers are not required to wear masks


  • M&A:

  • Apollo Global Management (APO) considering backing a bid for Twitter (TWTR) by Elon Musk or another suitor, according to the Wall Street Journal

  • Checkmate Pharmaceuticals (CMPI): Regeneron Pharma (REGN) to acquire CMPI for $10.50/share in cash

  • Columbia Financial (CLBK) receives regulatory approvals for acquisition of RSI Bank

  • Fulgent Genetics (FLGT) to acquire Inform Diagnostics for a total purchase price of approx. $170 mln in cash; raises Q1 revenue guidance and FY22 core revenue guidance

  • Griffon (GFF) to sell Telephonics Corporation to TTM Technologies (TTMI) for $330 mln in cash

  • Itau Unibanco Holding SA (ITUB) enters into agreement to purchase minority interest in Orbia

  • National Bank (NBHC) announces agreement to acquire Rock Canyon Bank in cash and stock transaction valued at $136.0 mln

  • Twitter (TWTR): Additional private equity firms want to be involved in any Twitter M&A deal, according to Reuters

  • Zendesk (ZEN) working with advisor on possible sale, according to Bloomberg


  • Syndicate:

  • No syndicate news of note.


  • IPOs:

  • Expected to Price:

  • No IPOs expected to price.



Gapping Up/Down

  • Gapping up:

  • SMCI +12.4%, GFF +8.8%, FLGT +7.6%, ZEN +5.6%, PLUG +3.8%, HOPE +2.9%, CFG +2%, PL +1.9%, EE+1.7%, BGNE +1.7%, APO +1.6%, SBNY +1.5%, EFC+0.5%


  • Gapping down:

  • NTGR -11.4%, ACAD -7.7%, PNFP -6.3%, NHI -2.9%, ACHR -2.8%, FNB -1.8%, RVP -1.7%, GSK -1%, ELS-0.8%, TWTR -0.6%, AMGN -0.5%


Analyst Research (see Upgrades/Downgradescalendarfor full list):

  • Upgrades

  • Carrefour SA (CRRFY) upgraded to Buy from Hold at Berenberg

  • CRH Plc. (CRH) upgraded to Overweight from Equal Weight at Barclays

  • lululemon athletica (LULU) upgraded to Buy from Hold at Truist; tgt raised to $495

  • NorthWestern (NWE) upgraded to Equal Weight from Underweight at Barclays; tgt raised to $62

  • Portland Gen Elec (POR) upgraded to Equal Weight from Underweight at Barclays; tgt raised to $57


  • Downgrades:

  • CMS Energy (CMS) downgraded to Equal Weight from Overweight at Barclays; tgt raised to $76

  • Eastman Chemical (EMN) downgraded to Neutral from Buy at BofA Securities; tgt lowered to $124

  • Electronic Arts (EA) downgraded to Neutral from Buy at Goldman; tgt lowered to $145

  • First Quantum Minerals (FQVLF) downgraded to Hold from Buy at Canaccord Genuity

  • ITV plc (ITVPY) downgraded to Sell from Hold at Berenberg

  • Moog (MOG.A) downgraded to Hold from Buy at Truist

  • Netflix (NFLX) initiated with a Neutral at Rosenblatt; tgt $354

  • Newmont Goldcorp (NEM) downgraded to Neutral from Outperform at Credit Suisse

  • NXP Semi (NXPI) downgraded to Neutral from Buy at Citigroup; tgt lowered to $190

  • Pinnacle West (PNW) downgraded to Underweight from Equal Weight at Barclays; tgt raised to $78

  • Playtika (PLTK) downgraded to Neutral from Buy at Goldman; tgt lowered to $22

  • Roblox (RBLX) downgraded to Neutral from Buy at Goldman; tgt lowered to $50

  • Shift4 Payments (FOUR) downgraded to Underweight from Equal-Weight at Morgan Stanley; tgt lowered to $41

  • Teck Resources (TECK) downgraded to Hold from Buy at Canaccord Genuity

  • Telephone & Data (TDS) downgraded to Equal-Weight from Overweight at Morgan Stanley; tgt $22

  • US Cellular (USM) downgraded to Equal-Weight from Overweight at Morgan Stanley; tgt $37


  • Others:

  • Alphabet A (GOOG, GOOGL) initiated with a Buy at Rosenblatt; tgt $4183

  • Amazon (AMZN) initiated with a Neutral at Rosenblatt; tgt $3000

  • AN2 Therapeutics (ANTX) initiated with an Outperform at Cowen

  • Apple (AAPL) initiated with a Neutral at Rosenblatt; tgt $184

  • AppLovin (APP) initiated with a Buy at Goldman; tgt $68

  • Dell (DELL) initiated with a Neutral at KGI Securities; tgt $52

  • DocGo (DCGO) initiated with a Buy at Deutsche Bank; tgt $11

  • Full House Resorts (FLL) initiated with a Buy at B. Riley Securities; tgt $20

  • Guidewire Software (GWRE) initiated with an Outperform at RBC Capital Mkts; tgt $125

  • Hewlett Packard Enterprise (HPE) initiated with an Outperform at KGI Securities; tgt $19

  • ironSource (IS) assumed with a Buy at Goldman; tgt lowered to $7

  • Kinetik (KNTK) initiated with a Buy at Mizuho; tgt $76

  • Matterport (MTTR) initiated with an Equal-Weight at Morgan Stanley; tgt $9

  • Patterson-UTI (PTEN) initiated with a Buy at The Benchmark Company; tgt $21

  • Penumbra (PEN) initiated with a Buy at Deutsche Bank; tgt $250

  • Pinterest (PINS) initiated with a Neutral at Rosenblatt; tgt $21

  • PropertyGuru (PGRU) initiated with a Neutral at BTIG Research

  • Roku (ROKU) initiated with a Buy at Rosenblatt; tgt $188

  • SciPlay (SCPL) assumed with a Buy at Goldman; tgt $20

  • Sierra Wireless (SWIR) initiated with an Outperform at William Blair

  • Snap (SNAP) initiated with a Buy at Rosenblatt; tgt $49

  • Twitter (TWTR) initiated with a Neutral at Rosenblatt; tgt $48

  • Vera Therapeutics (VERA) initiated with an Outperform at Wedbush; tgt $32

  • WeWork (WE) initiated with an Overweight at Piper Sandler; tgt $10


Upcoming Events:

  • Econ Data:

  • 08:30 ET: Housing Starts for Mar (Briefing.comConsensus 1750K; Prior 1769K)

  • 08:30 ET: Building Permits for Mar (Briefing.comConsensus 1840K; Prior 1859K)


  • Earnings:

  • Monday (Apr 18)

  • Morning: BAC BK SCHW SYF

  • Afternoon: ELS FNB HOPE JBHT NBHC PNFP


  • Tuesday (Apr 19)

  • Morning: BMI CFG CBSH FITB HAL HAS IRDM JNJ LMT MAN PLD SBNY SI TRV TFC

  • Afternoon: FHN FULT HWC IBM IBKR MRTN NFLX OMC PACW REXR LRN UCBI WTFC


  • Wednesday (Apr 20)

  • Morning: ABT ANTM ASML BKR CMA GATX HCSG LAD MTB MKTX NDAQ PG RCI

  • Afternoon: AA BDN CNS CCI CSX CVBF EFX FR GL KALU KMI KNX LRCX LSTR LBRT RLI SEIC SLG SNBR STLD THC TSLA TCBI UMPQ UAL VMI


  • Thursday (Apr 21)

  • Morning: ABB ALK AAL T AUB AN BANC BKU BX COLB DHR DOW EWBC FCX GPC HRI HOMB HBAN KEY MMC NEE NEP NUE PNR PM POOL DGX SASR SNA SON SNV TSCO TPH UNP WSO WNS

  • During Market Hours: WABC

  • Afternoon: ASB OZK BJRI SAM FFBC FE GBCI HTH ISRG PPG XM SNAP SIVB UFPI VICR WAL WSFS


  • Friday (Apr 22)

  • Morning: AXP ALV AZZ CLF FHB GNTX HCA KMB NEM RF SAP SLB VZ



Asia & Europe detail:

Asia: Nikkei +0.7%, Hang Seng -2.3%, Shanghai Composite -0.1%

Equity indices in the Asia-Pacific region ended Tuesday on a mixed note. Toyota expects that global production between May and July will average about 800,000 units per month, down from a recent rate of 840,000 per month. Chinese lenders are reportedly being encouraged to cut deposit rates. Xinhua speculated that China's CPI will only grow "modestly" in Q2 and Q3. The Minutes from the last Reserve Bank of Australia policy meeting noted that certain developments have pulled forward the timing of the initial rate hike. The Japanese yen has weakened to a 20-year low against the dollar.

  • In economic data:

  • Japan's February Industrial Production 2.0% m/m (last 0.1%) and Capacity Utilization 1.5% m/m (last -3.6%)

  • Australia's March New Home Sales 3.9% m/m (last -7.0%)


---Equity Markets---

  • Japan's Nikkei: +0.7%

  • Hong Kong's Hang Seng: -2.3%

  • China's Shanghai Composite: -0.1%

  • India's Sensex: -1.2%

  • South Korea's Kospi: +1.0%

  • Australia's ASX All Ordinaries: +0.6%

---FX---

  • USD/JPY: +1.0% to 128.33

  • USD/CNH: +0.3% to 6.4006

  • USD/INR: +0.3% to 76.51

Europe: DAX -0.8%, FTSE -0.4%, CAC -1.0%

Major European indices trade in the red while European debt also trades lower. French Finance Minister Le Maire said that an embargo on Russian oil is in the works. Stellantis will suspend its operations in Russia. British energy suppliers expect that the number of customers looking to pay their bills over time will increase by about 50% this year.

  • There was no notable data

---Equity Markets---

  • STOXX Europe 600: -1.2%

  • Germany's DAX: -0.8%

  • U.K.'s FTSE 100: -0.4%

  • France's CAC 40: -1.0%

  • Italy's FTSE MIB: -1.6%

  • Spain's IBEX 35: -1.7%

---FX---

  • EUR/USD: +0.1% to 1.0788

  • GBP/USD: UNCH at 1.3012

  • USD/CHF: +0.5% to 0.9490

0 views0 comments

Recent Posts

See All