The S&P 500 futures are up 4 points and are trading 0.1% above fair value. The Nasdaq 100 futures are up 12 points and are trading 0.1% above fair value. The Dow Jones Industrial Average futures are up 24 points and are trading 0.1% above fair value.
Stock futures indicate a higher open, but upside moves have been modest as participants await the FOMC policy decision, updated Summary of Economic Projections and dot plot, and Fed Chair Powell's press conference on Wednesday.
Separately, the OECD is projecting global growth of 3.0% in 2023 and 2.7% in 2024, noting there are significant downside risks. Its forecast for the US calls for 2.2% growth in 2023 and 1.3% in 2024.
Instacart will sell shares in its initial public offering today for $30, which is the high end of its $28-30 range.
The UAW threatened to extend its strike to more plants if there is not enough progress with automakers by noon on Friday.
The 2-yr note yield is up two basis points to 5.06% and the 10-yr note yield is unchanged from yesterday at 4.32%.
WTI crude oil futures are up 0.7% to $91.17/bbl.
In corporate news:
Starbucks (SBUX 95.53, -1.23, -1.3%): facing consumer lawsuit, according to Reuters; downgraded to Market Perform from Outperform at TD Cowen
CVS Health (CVS 71.35, +0.65, +0.9%): upgraded to Outperform from In-line at Evercore ISI
Dell (DELL 70.10, +0.95, +1.4%): upgraded to Outperform from Neutral at Daiwa Securities
AutoZone (AZO 2470.00, -52.10, -2.1%): beats by $1.18, beats on revs
Block (SQ 50.57, -0.68, -1.4%): CEO Alyssa Henry to depart, effective October 2; Jack Dorsey, the Company's Block Head and Chairperson, will also serve as the Square Head
U.S. Steel (X 31.02, +0.49, +1.6%): issues upside Q3 EPS guidance as each of company's segments are outperforming earlier estimates
Apogee Enterprises (APOG 52.50, +3.19, +6.5%): beats by $0.24, misses on revs; guides FY24 EPS above consensus, reaffirms FY24 revs guidance
Carnival (CCL 15.29, +0.25, +1.6%): upgraded to Hold from Sell at Truist
Deere (DE 402.76, -8.08, -2.0%): downgraded to In-line from Outperform at Evercore ISI
Intel (INTC 38.43, +0.44, +1.2%): indicated higher ahead of Intel Innovation event (Sept. 19-20)
Reviewing overnight developments:
Equity indices in the Asia-pacific region ended Tuesday on a mostly lower note while markets in India were closed for a holiday. Japan's Nikkei: -0.9%, Hong Kong's Hang Seng: +0.4%, China's Shanghai Composite: UNCH, India's Sensex: CLOSED, South Korea's Kospi: -0.6%, Australia's ASX All Ordinaries: -0.5%.
In economic data:
Hong Kong's August Unemployment Rate 2.8% (last 2.8%)
In news:
Japanese automakers have shown continued strength amid the ongoing contract dispute between United Auto Workers and Detroit's automakers.
Chinese press speculated that the People's Bank of China will not make changes to its loan prime rate this month but could announce additional cuts in Q4.
The Reserve Bank of Australia's latest policy minutes showed that policymakers believe that there is a strong case for pausing rate hikes.
Major European indices trade on a mostly flat note while Italy's MIB (+0.6%) outperforms with bank stocks showing strength. STOXX Europe 600: +0.1%, Germany's DAX: -0.1%, U.K.'s FTSE 100: +0.1%, France's CAC 40: +0.2%, Italy's FTSE MIB: +0.6%, Spain's IBEX 35: +0.4%.
In economic data:
Eurozone's July Current Account surplus EUR20.9 bln (expected surplus of EUR30.2 bln; last surplus of EUR35.8 bln). August CPI 0.5% m/m (expected 0.6%; last -0.1%); 5.2% yr/yr (expected 5.3%; last 5.3%). August Core CPI 0.3% m/m, as expected (last -0.1%); 5.3% yr/yr, as expected (last 5.5%)
Swiss August trade surplus CHF4.054 bln (expected surplus of CHF4.230 bln; last surplus of CHF3.132 bln)
In news:
Germany's Bundesbank expects the domestic economy to contract in Q3, noting that an "overhaul" is needed.
Meanwhile, the OECD's updated economic outlook showed that Germany is the only major economy that is expected to be in recession this year.
European Central Bank policymaker Villeroy de Galhau said that the ECB will maintain rates at 4.0%.
U.S. equity futures:
S&P 500 Futures +5 @ 4,459
DJIA Futures: +31 @ 34,655
Nasdaq 100 Futures: +16 @ 15,241
Overseas:
Europe: DAX -0.1%, FTSE +0.1%, CAC +0.2%
Asia: Nikkei -0.9%, Hang Seng +0.4%, Shanghai Composite UNCH
Commodities:
Crude Oil +0.68 @ 91.26
Nat Gas +0.012 @ 2.740
Gold +2.95 @ 1956.35
Silver +0.124 @ 23.622
Copper -0.0400 @ 3.7390
Earnings/Guidance:
Apogee Enterprises ( APOG â–´ 2.89% ) beats by $0.24, misses on revs; guides FY24 EPS above consensus, reaffirms FY24 revs guidance
AutoZone ( AZO â–¾ 2.19% ) beats by $1.18, beats on revs
Endava ( DAVA â–´ 1.53% ) beats by GBP0.12, reports revs in-line; guides Q1 EPS below consensus, revs below consensus; guides FY24 EPS below consensus, revs below consensus
NCR Corp ( NCR â–´ 0.56% ) provides 2027 financial targets in investor presentation slides
Stitch Fix ( SFIX â–´ 3.44% ) misses by $0.03, beats on revs; guides Q1 revs below consensus; guides FY24 revs below consensus
Synovus ( SNV â–¾ 0.47% ) expects an increase in third quarter charge-offs arising from a 10.75%
U.S. Steel ( X â–´ 2.78% ) issues upside Q3 EPS guidance as each of company's segments are outperforming earlier estimates
News:
UAW President Shawn Fain confirmed a new strike deadline of this Friday, Sept. 22 at noon
OECD released latest Interim Economic Outlook - global economy was stronger than expected in the first half of 2023, but the growth outlook is weak, inflation is proving persistent and there are significant downside risks
White House releases Partnership for Atlantic Cooperation fact sheet
Australia looking for tighter security standards for dating apps, according to AP
Agree Realty ( ADC â–´ 0.68% ) promotes Nicole Witteveen to COO, effective immediately
Airbnb ( ABNB â–¾ 1.54% ) listings in New York pressured by new regulations, according to the New York Post
Air Lease ( AL â–´ 0.19% ) announces a long-term lease placement for one Airbus A330-200 aircraft with HiSky, which is scheduled for delivery in 2023
Altair Engineering ( ALTR â–¾ 1.37% ) announces that the Ultra Librarian CAD model library is now available to Altair users in several Altair ECAD verification and multiphysics solutions, including Altair PollEx, Altair SimLab, and Altair One UDE
Arcutis ( ARQT â–¾ 3.81% ) Announces Positive Results from INTEGUMENT-PED Pivotal Phase 3 Trial of Roflumilast Cream 0.05% for the Treatment of Atopic Dermatitis in Children Ages 2 to 5
AutoZone ( AZO â–¾ 2.19% ) promotes new COO
Bausch Health ( BHC â–¾ 7.41% ) confirmed yesterday that Tom Vadaketh will resign as the Executive Vice President, Chief Financial Officer of the Company
BeiGene ( BGNE â–´ 0.21% ) entered into an agreement with Novartis (NVS) to regain worldwide rights to develop, manufacture, and commercialize TEVIMBRA (tislelizumab)
Best Buy ( BBY â–¾ 0.50% ) provides holiday updates including exclusive Samsung and Microsoft sale events
Block ( SQ â–¾ 2.79% ) CEO Alyssa Henry to depart, effective October 2
BP ( BP â–´ 1.04% ) appoints Kate Thomson as CFO
Bright Health Group ( BHG â–´ 1.43% ) continues to make significant progress towards ACA Insurance Business wind-down
Enersys ( ENS â–´ 0.32% ) awarded $91.8 mln multi-year contract to supply its Thin Plate Pure Lead batteries to the U.S. Navy
Enviri Corporation ( NVRI â–¾ 0.13% ) to appoint Tom Vadaketh CFO
EQT Corp. ( EQT â–¾ 0.66% ) enters into tolling agreement with Commonwealth LNG to produce 1 mln tons per annum of LNG under 15-yr contract
Eversource Energy ( ES â–´ 0.16% ) elects Paul Chodak as Executive VP and COO, effective November 13
Ford ( F â–¾ 0.12% ) of Canada confirmed last night that it has agreed to continue negotiations beyond the September 18, 11:59 p.m. ET deadline to achieve a tentative agreement
Fortis ( FTS â–´ 0.18% ) announces $25 bln five year capital outlook and 4.4% increase in Q4 dividend
GlaxoSmithKline ( GSK â–´ 0.16% ): European Commission authorizes ViiV Healthcare's Apretude (cabotegravir long-acting and tablets) for HIV prevention
Hawaiian Electric ( HE â–´ 0.23% ) appoints Paul Ito to subsidiary CFO position through approximately December 31, 2024 following planned retirement of Tayne Sekimura on September 30, 2023
Merck ( MRK â–´ 0.12% ) announced FDA has accepted and granted priority review for a supplemental new drug application (sNDA) seeking approval for WELIREG
Mercury ( MRCY â–´ 0.71% ) introduces the first space-qualified FPGA processing board to use AMD's Xilinx Versal AI core
Microsoft ( MSFT â–¾ 0.64% ): Internal sensitive data exposed at Microsoft, according to TechCrunch
Microsoft ( MSFT â–¾ 0.64% ) to offer game streaming service, according to The Verge
Mobilicom Ltd. ( MOB â–´ 7.58% ) announced an initial purchase order for two of its products from a new customer, one of the largest defense contractors in Europe
New Pacific ( NEWP â–´ 0.43% ) announced yesterday the Filing of NI 43-101 Technical Report for the Carangas Project
Norfolk Southern ( NSC â–¾ 1.28% ) announces interim Value Assurance Program to compensate any reduction in value of residential properties in East Palestine, OH following the February derailment
Orchestra BioMed ( OBIO â–´ 16.11% ) announces the U.S. FDA granted approval of an investigational device exemption to initiate the global pivotal BACKBEAT study evaluating the efficacy and safety of atrioventricular interval modulation therapy for treating hypertensive patients who are indicated for a dual-chamber cardiac pacemaker
Pfizer ( PFE â–´ 0.64% ) receives EC approval for LITFULO
Revolution Medicines ( RVMD â–¾ 0.02% ) Doses First Patient in Phase 1/1b Clinical Trial of RMC-9805, an Oral, Covalent, Mutant-Selective KRASG12D(ON) Inhibitor
Rocket Lab USA ( RKLB â–¾ 10.42% ) experiences issue on co's 41st mission
Starbucks ( SBUX â–¾ 1.82% ) facing consumer lawsuit, according to Reuters
Stellantis ( STLA â–´ 1.90% ) resumes negotiations with UAW reps focused on common ground, according to Bloomberg
Target ( TGT â–´ 0.46% ) is making holiday shopping more affordable, introducing strategic partnerships
Telefonica Brasil ( VIV â–´ 1.53% ) provides ANATEL court updates
Ulta Beauty ( ULTA â–´ 0.07% ) COO Kecia Steelman also to become President of Ulta Beauty
Wabash Natl ( WNC â–´ 1.21% ) announces multi-year agreement with Rockland Flooring for laminated wood trailer flooring
M&A:
Hut 8 Mining ( HUT â–¾ 3.49% ) provides update on business combination with USBTC
indie Semiconductor ( INDI â–¾ 0.46% ) enters into definitive agreement to acquire EXALOS AG; company paid approximately $45 mln to EXALOS equity holders
Ligand Pharma ( LGND â–´ 1.20% ) spinning out and merging Pelican subsidiary with Primordial Genetics to form Primrose Bio; alters FY23 revenue outlook, raises earnings forecast
Syndicate:
Allurion Technologies ( ALUR â–¾ 0.08% ) files for 55,005,366 shares of common stock by selling shareholders
Fortis ( FTS â–´ 0.18% ) established an at-the-market equity program that allows the Corporation to issue up to C$500,000,000 (or its U.S. dollar equivalent) of common shares
indie Semiconductor ( INDI â–¾ 0.46% ) files for 10,070,008 shares of common stock by selling shareholders
Jones Lang LaSalle ( JLL â–¾ 0.19% ) files mixed shelf securities offering
Terran Orbital ( LLAP â–¾ 16.20% ) to offer shares in public offering, no amount provided
IPOs:
Expected to Price:
Klaviyo (NYSE: KVYO): The provider of a cloud-based business process outsourcing platform is expected to price its 19.2 M share IPO between $25-$27.
Priced to Trade:
Instacart (Nasdaq: CART): The provider of an online grocery shopping and delivery platform priced its 22.0 M share IPO at $30, the high end of the $28-$30 expected range.
Gapping Up/Down
Gapping up:
INDI +7%, MRCY +2.9%, STLA +2.1%, SNV +1.7%, X +1.4%, APOG +1.4%, BP +1.1%, HUT +0.9%, CLF +0.6%
Gapping down:
LLAP -17.6%, RKLB -16.3%, SFIX -6.2%, NIO -4.9%, ALUR -3.2%, WNC -2%, JLL -2%, AL -1.8%, SQ -0.7%, ES -0.5%
Analyst Research (see Upgrades/Downgrades calendar for full list):
Upgrades
Carnival (CCL) upgraded to Hold from Sell at Truist; tgt raised to $17
CVS Health (CVS) upgraded to Outperform from In-line at Evercore ISI; tgt raised to $83
Dell (DELL) upgraded to Outperform from Neutral at Daiwa Securities; tgt raised to $80
Globus Medical (GMED) upgraded to Buy from Hold at Stifel; tgt $61
Rackspace Technology (RXT) upgraded to Outperform from Mkt Perform at Raymond James; tgt $3.50
Rexford Industrial Realty (REXR) upgraded to Outperform from Peer Perform at Wolfe Research; tgt $70
Downgrades:
CNH Industrial (CNHI) downgraded to In-line from Outperform at Evercore ISI; tgt lowered to $14
Daqo New Energy (DQ) downgraded to Hold from Outperform at Daiwa Securities; tgt lowered to $32
Deere (DE) downgraded to In-line from Outperform at Evercore ISI; tgt lowered to $424
Lazard (LAZ) downgraded to Sell from Neutral at Goldman; tgt lowered to $32
NatWest Group plc (NWG) downgraded to Hold from Buy at HSBC Securities
Planet Fitness (PLNT) downgraded to Neutral from Overweight at JP Morgan; tgt lowered to $52
Starbucks (SBUX) downgraded to Market Perform from Outperform at TD Cowen; tgt lowered to $107
Others:
Akero Therapeutics (AKRO) initiated with an Overweight at Cantor Fitzgerald; tgt $69
Arm Holdings plc (ARM) initiated with a Neutral at Redburn Atlantic; tgt $50
Array Tech (ARRY) added to US 1 List at BofA Securities; tgt $30
Arrowhead (ARWR) initiated with a Neutral at Citigroup; tgt $33
Aurora Innovation (AUR) initiated with a Market Perform at TD Cowen; tgt $3
ExlService (EXLS) initiated with a Hold at Jefferies; tgt $33
GE HealthCare (GEHC) initiated with a Buy at Citigroup; tgt $82
Interactive Brokers (IBKR) initiated with a Neutral at Goldman; tgt $97
Intercontinental Hotels Group (IHG) resumed with a Buy at BofA Securities
Praxis Precision Medicines (PRAX) initiated with a Buy at Truist; tgt $10
Raymond James (RJF) initiated with a Neutral at JP Morgan; tgt $121
Ryan Specialty Group (RYAN) initiated with a Mkt Perform at JMP Securities
Super Micro Computer (SMCI) initiated with an Overweight at Barclays; tgt $327
The Vita Coco Company (COCO) initiated with an Equal-Weight at Morgan Stanley; tgt $29
WNS (WNS) initiated with a Buy at Jefferies; tgt $82
Econ Data:
08:30 ET: Housing Starts for Aug (Briefing.com Consensus 1435K; Prior 1452K)
08:30 ET: Building Permits for Aug (Briefing.com Consensus 1442K; Prior 1442K)
Earnings:
Monday (Sep 18)
Afternoon: SFIX
Tuesday (Sep 19)
Morning: APOG AZO DAVA
Afternoon: SCS
Wednesday (Sep 20)
Morning: GIS
Afternoon: FDX KBH
Thursday (Sep 21)
Morning: DRI FDS
Asia & Europe detail:
Asia: Nikkei -0.9%, Hang Seng +0.4%, Shanghai Composite UNCH
Equity indices in the Asia-pacific region ended Tuesday on a mostly lower note while markets in India were closed for a holiday. Japanese automakers have shown continued strength amid the ongoing contract dispute between United Auto Workers and Detroit's automakers. Chinese press speculated that the People's Bank of China will not make changes to its loan prime rate this month but could announce additional cuts in Q4. The Reserve Bank of Australia's latest policy minutes showed that policymakers believe that there is a strong case for pausing rate hikes.
In economic data:
Hong Kong's August Unemployment Rate 2.8% (last 2.8%)
---Equity Markets---
Japan's Nikkei: -0.9%
Hong Kong's Hang Seng: +0.4%
China's Shanghai Composite: UNCH
India's Sensex: CLOSED
South Korea's Kospi: -0.6%
Australia's ASX All Ordinaries: -0.5%
---FX---
USD/JPY: +0.1% to 147.66
USD/CNH: +0.2% to 7.2987
USD/INR: +0.1% to 83.32
Europe: DAX -0.1%, FTSE +0.1%, CAC +0.2%
Major European indices trade on a mostly flat note while Italy's MIB (+0.6%) outperforms with bank stocks showing strength. Germany's Bundesbank expects the domestic economy to contract in Q3, noting that an "overhaul" is needed. Meanwhile, the OECD's updated economic outlook showed that Germany is the only major economy that is expected to be in recession this year. European Central Bank policymaker Villeroy de Galhau said that the ECB will maintain rates at 4.0%.
In economic data:
Eurozone's July Current Account surplus EUR20.9 bln (expected surplus of EUR30.2 bln; last surplus of EUR35.8 bln). August CPI 0.5% m/m (expected 0.6%; last -0.1%); 5.2% yr/yr (expected 5.3%; last 5.3%). August Core CPI 0.3% m/m, as expected (last -0.1%); 5.3% yr/yr, as expected (last 5.5%)
Swiss August trade surplus CHF4.054 bln (expected surplus of CHF4.230 bln; last surplus of CHF3.132 bln)
---Equity Markets---
STOXX Europe 600: +0.1%
Germany's DAX: -0.1%
U.K.'s FTSE 100: +0.1%
France's CAC 40: +0.2%
Italy's FTSE MIB: +0.6%
Spain's IBEX 35: +0.4%
---FX---
EUR/USD: +0.1% to 1.0703
GBP/USD: +0.1% to 1.2400
USD/CHF: -0.1% to 0.8962