The S&P 500 futures are down 3 points and are trading 0.1% below fair value. The Nasdaq 100 futures are down 24 points and are trading 0.1% below fair value. The Dow Jones Industrial Average futures are down 20 points and are trading 0.1% below fair value.
The stock market is poised for flattish open today. There's still a lingering sense that the market is due for consolidation period. Also, Fed Chair Powell will begin his semiannual monetary policy report before the House Financial Services Committee at 10:00 a.m. ET.
Hotter than expected CPI and Core CPI figures from the U.K. have created some angst and boosted expectations for a 50-bps rate hike ahead of the Bank of England's policy decision tomorrow.
The weekly MBA Mortgage Applications Index rose 0.5% with purchase applications rising 2.0% while refinancing applications fell 2.0%.
Treasuries are little changed from yesterday's settlement levels. The 2-yr note yield is up one basis point to 4.71% and the 10-yr note yield is up three basis points to 3.75%. The U.S. Dollar Index is flat at 102.57.
In corporate news:
FedEx (FDX 225.99, -5.66, -2.4%): beats by $0.09, misses on revs; guides FY24 EPS in-line, revs in-line; says demand backdrop likely to pressure sales growth in FY24
Visa (V 226.60, +0.13, +0.1%): appoints Chris Suh as CFO; succeeds Vasant Prabhu, who will serve as CFO Designate from July 10 until August 1, departing on September 30
American Intl (AIG 56.00, -0.08, -0.1%): annonces that that Sabra Purtill, who has served as Interim CFO January 2023, has been named to the role on a permanent basis, effective immediately
Spotify (SPOT 159.65, +2.83, +1.8%): upgraded to Outperform from Peer Perform at Wolfe Research
Tesla (TSLA 278.27, +3.82, +1.4%): downgraded to Equal Weight from Overweight at Barclays
Adobe (ADBE 493.95, +8.09, +1.7%): upgraded to Outperform from Market Perform at BMO Capital Markets
3M (MMM 102.16, -0.14, -0.1%): could face dividend cut & higher debt amid potential lawsuits, according to the WSJ
Patterson Companies (PDCO 30.90, +2.64, +9.3%): beats by $0.14, beats on revs; guides FY24 EPS above consensus
Intel (INTC 34.79, -0.21, -0.6%): to sell 20% stake in IMS Nanofabrication GmbH to Bain Capital in deal that values IMS at approx. $4.3 bln
Reviewing overnight developments:
Equity indices in the Asia-Pacific region ended the midweek session on a mostly lower note. Japan's Nikkei: +0.6%, Hong Kong's Hang Seng: -2.0%, China's Shanghai Composite: -1.3%, India's Sensex: +0.3%, South Korea's Kospi: -0.9%, Australia's ASX All Ordinaries: -0.6%.
In economic data:
Japan's June Reuters Tankan Index 8 (last 6)
South Korea's May PPI -0.3% m/m (expected -0.2%; last -0.1%); 0.6% yr/yr (expected 0.5%; last 1.6%)
Australia's May MI Leading Index 0.0% m/m (last 0.0%)
In news:
Property stocks in Hong Kong underperformed amid ongoing hope for more impactful stimulus measures while China Securities Journal speculated that more rate cuts will be made this year.
Japan's Prime Minister Kishida may reshuffle his cabinet this summer.
South Korea's exports were up 5.3% yr/yr through the first 20 days of June, though chip exports were down 23.5% yr/yr.
Major European indices trade near their flat lines. STOXX Europe 600: -0.2%, Germany's DAX: -0.2%, U.K.'s FTSE 100: -0.2%, France's CAC 40: -0.3%, Italy's FTSE MIB: +0.3%, Spain's IBEX 35: +0.1%.
In economic data:
U.K.'s May CPI 0.7% m/m (expected 0.5%; last 1.2%); 8.7% yr/yr (expected 8.4%; last 8.7%). May Core CPI 0.8% m/m (expected 0.6%; last 1.3%); 7.1% yr/yr (expected 6.8%; last 6.8%). May Input PPI -1.5% m/m (expected -0.5%; last 0.1%); 0.5% yr/yr (expected 1.2%; last 4.2%) May Output PPI -0.5% m/m (expected -0.1%; last -0.2%); 2.9% yr/yr (expected 3.6%; last 5.2%). June CBI Industrial Trends Orders -15 (expected -17; last -17)
In news:
Hotter than expected CPI and Core CPI figures from the U.K. have boosted expectations for a 50-bps rate hike tomorrow.
European Central Bank policymaker Villeroy de Galhau repeated that the bulk of the tightening has been completed and that inflation could return to the 2.0% target around the end of 2024.
U.S. equity futures:
S&P 500 Futures: -2 @ 4,387
DJIA Futures: -12 @ 34,042
Nasdaq 100 Futures: -21 @ 15,050
Overseas:
Europe: DAX -0.2%, FTSE -0.2%, CAC -0.3%
Asia: Nikkei +0.6%, Hang Seng -2.0%, Shanghai Composite -1.3%
Commodities:
Crude Oil -0.08 @ 71.11
Nat Gas +0.029 @ 2.521
Gold -1.35 @ 1946.35
Silver -0.099 @ 23.135
Copper -0.0317 @ 3.8518
Earnings/Guidance:
Bristow Group (VTOL) guides FY23 and FY24 revenue inline
Dollar Tree (DLTR) reaffirms Q2 and FY23 guidance at ahead of Investor Conference' provides longer term outlook
Equinix (EQIX) in slide presentation says total FY23 Capex is projected at $8-11 bln
FedEx (FDX) beats by $0.09, misses on revs; guides FY24 EPS in-line, revs in-line
La-Z-Boy (LZB) beats by $0.27, beats on revs; guides JulQ revs below two analyst estimate; expects FY24 growth ahead of industry with 2H24stronger than 1H24
Patterson Companies (PDCO) beats by $0.14, beats on revs; guides FY24 EPS above consensus
SM Energy (SM) announces certain Q2 activity: 2.6 million shares repurchased, production up, capital expenditures down, and entered agreements to acquire 22,800 oily net acres; provides Q2 and FY23 guidance
Winnebago (WGO) beats by $0.33, misses on revs
News:
China says President Biden calling Xi Jinping a dictator is a "public political provocation", according to Bloomberg
Wall Street is betting against downtown business centers by paying less for bonds connected to downtown office buildings and public transit, according to the Wall Street Journal
China introduced tax breaks for electric vehicles, according to Reuters
SEC secures emergency relief to protect Binance.US customers' assets
3M (MMM) could face dividend cut & higher debt amid potential lawsuits, according to the Wall Street Journal
Airbus (EADSY): Avolon Agrees Memorandum of Understanding to Order 20 Airbus A330neo Aircraft
American Intl (AIG) announces that that Sabra Purtill, who has served as Interim CFO January 2023, has been named to the role on a permanent basis, effective immediately
Ant Group developing language model technology, according to Bloomberg
Arbutus (ABUS) presents preliminary AB-729 and Pegylated Interferon Alfa-2a Combination Data at the EASL Congress 2023
argenx (ARGX) receives FDA approval of VYVGART Hytrulo injection
Blackstone Secured Lending Fund (BXSL) increases quarterly dividend 10% to $0.77/share from $0.70/share
Bluebirdbio (BLUE) announces that the U.S. Food and Drug Administration has accepted the Biologics License Application for lovotibeglogene autotemcel (lovo-cel) for priority review
Boeing (BA): Alaska Air (ALK) orders four 737-8s to support international growth plans
Boeing (BA): Luxair selects Boeing 737-7 to grow single-aisle fleet
Boeing (BA) and Air Lease (AL) announce order for two 787 Dreamliners
Catalent (CTLT) names Matti Masanovich as Senior Vice President & Chief Financial Officer, effective July 5, 2023
Chemomab Therapeutics (CMMB) Reports Positive Data from Secondary Analysis of Phase 2a Liver Fibrosis Trial in NASH Patients at EASL 2023
Cleveland-Cliffs (CLF) reached a new three-year labor agreement with the United Auto Workers for Coshocton Works, to become effective July 31, 2023
CymaBay Therapeutics (CBAY) Presents Data Showing Seladelpar Treatment in Primary Biliary Cholangitis (PBC) Correlates with Alleviation of Self-Reported Pruritus and Reduction in Serum IL-31 Levels
Electronic Arts (EA) appoints Stuart Canfield CFO, effective immediately; succeeds Chris Suh, who is leaving for Visa
Electronic Arts (EA) aligning its studios into two organizations: EA Entertainment and EA SPORTS
Eli Lilly (LLY): FDA last night approved new class of medicines to treat pediatric type 2 diabetes
Exact Sciences Corp. (EXAS): Next-generation Cologuard Test Demonstrates 94 Percent Sensitivity for Colorectal Cancer at 91 Percent Specificity, Raising the Bar in Non-invasive Screening
FedEx (FDX) announces that CFO and EVP Michael Lenz will retire effective July 31, 2023
GlaxoSmithKline (GSK) reports positive data for Arexvy
Illumina (ILMN) unit, GRAIL, reports The Lancet Oncology published results from SYMPLIFY
InflaRx (IFRX) announced today the commercial launch of Gohibic (vilobelimab) in the U.S. In April 2023
Insulet (PODD) announces commercial launch of its Omnipod 5 Automated Insulin Delivery System for individuals aged two years and older with type 1 diabetes in the UK
LPL Financial (LPLA) announces total assets at the end of May were +6.2% yr/yr to $1.19 trln
MiMedx Group (MDXG) announces strategic realignment; raises expectations to deliver mid-teens percentage sales growth in 2023
Oatly Group AB (OTLY) partners with TH International (THCH) to launch a dairy-free ready-to-drink oatmilk latte product line
Orthofix (OFIX) announced that Catherine Burzik has been re-appointed as the Chair of the Company's Board of Directors
Pfizer (PFE) receives FDA approval for TALZENNA in combination with XTANDI
PTC Therapeutics (PTCT) Shares Positive Interim Data from PIVOT-HD Clinical Trial in Huntington's Disease Patients
QIAGEN (QGEN): FBI approves QIAGEN's NGS-based ForenSeq MainstAY workflow for the U.S. National DNA Index System
Raytheon Technologies (RTX) awarded $1.15 bln U.S. Air Force contract for Advanced Medium Range Air-to-Air Missile Production Lot 37
Raytheon Technologies (RTX) receives $1.15 bln US Air Force award for latest AMRAAM configuration
Ross Stores' (ROST) Board of Directors approves new employment agreement with Barbara Rentler, Vice Chair and CEO, extending her contract through March 31, 2027
Southern's (SO) Nicor Gas is analyzing the Illinois Commission's order and estimates a range of possible outcomes of approximately $38 million to $44 million in disallowances
Stanley Black & Decker (SWK): SEC announces settled charges against Stanley Black & Decker
Starbucks (SBUX): Shanghai regulators have concerns about data collection at Starbucks and Shake Shack (SHAK), according to Reuters
Ternium S.A.'s (TX) new steel slab mill will be built at and integrated into the company's existing downstream facility in Pesquera, Nuevo Len, Mexico following an extensive review of location candidates
Tesla (TSLA): Texas to require that charging stations include Tesla plug, according to Reuters
Tesla (TSLA) CEO Elon Musk says Tesla will come to India market "as soon as possible", according to BBC
TikTok preparing move into online shopping, according to Financial Times
uniQure (QURE) announces promising interim data, including up to 24 months of follow-up, from 26 patients enrolled in the ongoing U.S. Phase I/II clinical trial of AMT-130 for the treatment of Huntington's disease
Victoria's Secret (VSCO) announces leadership appointments
Visa (VISA) appoints Chris Suh as CFO; succeeds Vasant Prabhu, who will serve as CFO Designate from July 10 until August 1, departing on September 30
Vodafone (VOD) mulling options for Spanish unit, according to Reuters
Worthington (WOR) announces that the D.C. Circuit Court of Appeals supported Worthington's position in concluding that the U.S. Environmental Protection Agency's 2021 ban of non-refillable refrigerant cylinders is invalid because the EPA overstepped its authority granted by Congress
Xeris Biopharma (XERS) announces that the first participant has been dosed in a multi-center, open label, Phase 2 study of XP-8121 for the treatment of adults with hypothyroidism
M&A:
3D Systems (DDD) Affirms Commitment to Pursuing Combination with Stratasys (SSYS)
Eni S.p.A. (E) nearing $5.0 bln deal for oil and gas explorer Neptune Energy Group, according to Bloomberg
Intel (INTC) to sell 20% stake in IMS Nanofabrication GmbH to Bain Capital for $4.3 bln
Petrobras (PBR) reaffirms no decision on Braksem (BAK)
Seadrill Ltd (SDRL) divests tender-assist units for $85 mln
Shore Bancshares (SHBI) and The Community Financial Corporation (TCFC) announce that SHBI's shareholders approved the merger of TCFC with and into SHBI, with SHBI as the surviving corporation
Syndicate:
Chicago Atlantic Real Estate Finance (REFI) and Chicago Atlantic REIT Manager entered into separate at-the-market sales agreements to issue and sell up to $75,000,000 of common stock
CNB Financial (CCNE) files mixed shelf securities offering
Desktop Metal (DM) files for 444,793 shares of common stock by selling shareholders
Euronav (EURN) files mixed shelf securities offering
Madison Square Garden Entertainment (MSGE) files for 5,250,000 shares of common stock by selling shareholder
ONEOK (OKE) files mixed shelf securities offering
IPOs:
No IPOs expected.
Gapping Up/Down
Gapping up:
PCT +14.9%, EXAS +6.6%, ABR +5.4%, BXSL +3%, DM +2.9%, FULT +2.1%, PODD +1.8%, SDRL +1.5%, AIG +1.3%, DDD +1%, SSYS +0.8%, THCH +0.7%, ARGX +0.7%, NFLX +0.5%, BA +0.5%
Gapping down:
MSGE -6.6%, LZB -5.3%, FDX -3.6%, NPWR -2.5%, ABUS -1.6%, DLTR -0.8%, UPS -0.7%, MDXG -0.7%, QGEN -0.7%, XPO -0.5%
Analyst Research (see Upgrades/Downgradescalendarfor full list):
Upgrades
Adidas AG (ADDYY) upgraded to Buy from Neutral at UBS
Adobe (ADBE) upgraded to Outperform from Market Perform at BMO Capital Markets; tgt raised to $570
AVANGRID (AGR) upgraded to Sector Weight from Underweight at KeyBanc Capital Markets
LiveRamp (RAMP) upgraded to Buy from Hold at The Benchmark Company; tgt $33
OneSpaWorld (OSW) upgraded to Buy from Hold at Loop Capital; tgt $13
Petrobras (PBR) upgraded to Buy from Neutral at Goldman
Spotify (SPOT) upgraded to Outperform from Peer Perform at Wolfe Research; tgt $190
Downgrades:
Coherent (COHR) downgraded to Neutral from Buy at Rosenblatt; tgt raised to $55
Constellation Energy (CEG) downgraded to Sector Weight from Overweight at KeyBanc Capital Markets
Infosys (INFY) downgraded to Negative from Neutral at Susquehanna; tgt $13
Lloyds Banking (LYG) downgraded to Neutral from Outperform at Exane BNP Paribas
Match Group (MTCH) downgraded to Peer Perform from Outperform at Wolfe Research
NatWest Group plc (NWG) downgraded to Underperform from Neutral at Exane BNP Paribas
Peloton (PTON) downgraded to Underperform from Peer Perform at Wolfe Research; tgt $6
Tesla (TSLA) downgraded to Equal Weight from Overweight at Barclays; tgt raised to $260
The Beauty Health Company (SKIN) downgraded to Hold from Buy at Stifel; tgt lowered to $10
Others:
Avantor (AVTR) initiated with an Outperform at RBC Capital Mkts; tgt $27
Avidbank Holdings (AVBH) initiated with a Buy at DA Davidson; tgt $24
Bumble Inc. (BMBL) assumed with a Peer Perform at Wolfe Research
Duolingo (DUOL) initiated with a Peer Perform at Wolfe Research
Everest Re (RE) initiated with a Buy at Citigroup; tgt $406
FiscalNote Holdings (NOTE) initiated with a Buy at ROTH MKM; tgt $4.75
Private Bancorp of America (PBAM) initiated with a Buy at DA Davidson; tgt $39
Tidewater (TDW) initiated with a Buy at BTIG Research; tgt $75
Tyler Tech (TYL) initiated with an Overweight at JP Morgan; tgt $472
Econ Data:
07:00 ET: MBA Mortgage Applications Index for June 17 (Briefing.comConsensus NA; Prior 7.2%)
10:30 ET: EIA Crude Oil Inventories for June 17 (Briefing.comConsensus NA; Prior +7.92M)
Earnings:
Tuesday (Jun 20)
Afternoon: FDX LZB
Wednesday (Jun 21)
Morning: PDCO WGO
Afternoon: KBH SCS
Thursday (Jun 22)
Morning: ACN CMC DRI FDS GMS
Afternoon: SWBI
Friday (Jun 23)
Morning: APOG KMX
Asia & Europe detail:
Asia: Nikkei +0.6%, Hang Seng -2.0%, Shanghai Composite -1.3%
Equity indices in the Asia-Pacific region ended the midweek session on a mostly lower note. Property stocks in Hong Kong underperformed amid ongoing hope for more impactful stimulus measures while China Securities Journal speculated that more rate cuts will be made this year. Japan's Prime Minister Kishida may reshuffle his cabinet this summer. South Korea's exports were up 5.3% yr/yr through the first 20 days of June, though chip exports were down 23.5% yr/yr.
In economic data:
Japan's June Reuters Tankan Index 8 (last 6)
South Korea's May PPI -0.3% m/m (expected -0.2%; last -0.1%); 0.6% yr/yr (expected 0.5%; last 1.6%)
Australia's May MI Leading Index 0.0% m/m (last 0.0%)
---Equity Markets---
Japan's Nikkei: +0.6%
Hong Kong's Hang Seng: -2.0%
China's Shanghai Composite: -1.3%
India's Sensex: +0.3%
South Korea's Kospi: -0.9%
Australia's ASX All Ordinaries: -0.6%
---FX---
USD/JPY: +0.3% to 141.78
USD/CNH: +0.2% to 7.1895
USD/INR: UNCH at 81.98
Europe: DAX -0.2%, FTSE -0.2%, CAC -0.3%
Major European indices trade near their flat lines. Hotter than expected CPI and Core CPI figures from the U.K. have boosted expectations for a 50-bps rate hike tomorrow. European Central Bank policymaker Villeroy de Galhau repeated that the bulk of the tightening has been completed and that inflation could return to the 2.0% target around the end of 2024.
In economic data:
U.K.'s May CPI 0.7% m/m (expected 0.5%; last 1.2%); 8.7% yr/yr (expected 8.4%; last 8.7%). May Core CPI 0.8% m/m (expected 0.6%; last 1.3%); 7.1% yr/yr (expected 6.8%; last 6.8%). May Input PPI -1.5% m/m (expected -0.5%; last 0.1%); 0.5% yr/yr (expected 1.2%; last 4.2%) May Output PPI -0.5% m/m (expected -0.1%; last -0.2%); 2.9% yr/yr (expected 3.6%; last 5.2%). June CBI Industrial Trends Orders -15 (expected -17; last -17)
---Equity Markets---
STOXX Europe 600: -0.2%
Germany's DAX: -0.2%
U.K.'s FTSE 100: -0.2%
France's CAC 40: -0.3%
Italy's FTSE MIB: +0.3%
Spain's IBEX 35: +0.1%
---FX---
EUR/USD: UNCH at 1.0920
GBP/USD: -0.3% to 1.2721
USD/CHF: -0.1% to 0.8971
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