top of page
Search

25/08/23 Briefing


The S&P 500 futures are up 11 points and are trading 0.3% above fair value. The Nasdaq 100 futures are up 15 points and are trading 0.1% above fair value. The Dow Jones Industrial Average futures are up 109 points and are trading 0.3% above fair value.

Following yesterday's disappointing trade, there is a modest bid in the futures market this morning. This comes ahead of Fed Chair Powell's speech at the Jackson Hole Symposium at 10:05 a.m. ET. The weakness yesterday was blamed in large part on some nervousness in front of that speech, so there is a modicum of hope in the equity futures market that Mr. Powell might not sound as hawkish as feared.

Other reports this morning have highlighted stimulus efforts in China that include cutting the stamp duty on stock trading by up to 50% and authorities encouraging financial institutions to increase their stock investments. That didn't help the Shanghai Composite, however. It declined 0.6% and ended the week down 2.2%.

The 2-yr note yield is up two basis points to 5.03% and the 10-yr note yield is unchanged at 4.24%.

Today's economic calendar will feature:

  • 10:00 ET: August University of Michigan Consumer Sentiment - Final

  • 10:05 ET: Fed Chair Powell speech at Jackson Hole on economic outlook

In corporate news:

  • Netflix (NFLX 409.55, +2.62, +0.6%): Loop Capital upgrades to Buy from Hold; raises price target to $500 from $425

  • Marvell Technology (MRVL 55.33, -1.96, -3.4%): beats by $0.01, reports revs in-line; guides Q3 EPS in-line, revs in-line

  • Ulta Beauty (ULTA 426.00, +3.26, +0.8%): beats by $0.17, beats on revs; guides FY24 EPS in-line, revs in-line

  • Affirm Holdings (AFRM 14.81, +1.00, +7.2%): beats by $0.18, beats on revs; guides Q1 revs above consensus

  • Hawaiian Electric Industries (HE 9.93, -1.93, -16.3%): Maui County suing HE over fires alleging negligence; suspends quarterly dividend beginning with Q3; drew $200 million under their existing revolving unsecured credit facilities

  • Intuit (INTU 488.00, -10.50, -2.1%): beats by $0.22, beats on revs; guides Q1 EPS below consensus, revs in-line; guides FY24 EPS above consensus, revs in-line

  • Workday (WDAY 231.51, +6.64, +3.0%): beats by $0.22, beats on revs; guides Q1 EPS below consensus, revs in-line; guides FY24 EPS above consensus, revs in-line

  • Gap, Inc. (GPS 9.54, +0.01, +0.1%): beats by $0.25, reports revs in-line, comps -6%; guides Q3 revs below consensus; guides FY24 revs in-line

  • Nordstrom (JWN 16.20, -0.62, -3.7%): beats by $0.36, beats on revs; reaffirms FY24 EPS guidance

  • Domo (DOMO 11.58, -5.46, -32.0%): beats by $0.07, reports revs in-line; guides Q3 EPS below consensus, revs below consensus; guides FY24 EPS below consensus, revs below consensus

Reviewing overnight developments:

  • Equity indices in the Asia-Pacific region ended the week on a lower note. Japan's Nikkei: -2.1%, Hong Kong's Hang Seng: -1.4%, China's Shanghai Composite: -0.6%, India's Sensex: -0.6%, South Korea's Kospi: -0.7%, Australia's ASX All Ordinaries: -0.9%.

  • In economic data:

  • Japan's August CPI 2.6% yr/yr (last 2.5%). August Tokyo CPI 2.9% yr/yr (expected 3.0%; last 3.2%) and Tokyo Core CPI 2.8% yr/yr (expected 2.9%; last 3.0%)

  • Singapore's July Industrial Production 4.1% m/m (expected -0.5%; last 3.3%); -0.9% yr/yr (expected -3.8%; last -6.6%)

  • In news:

  • Japan's Tokyo Core CPI was up 2.8% yr/yr in August, representing the slowest pace of increase since September 2022

  • China Securities Regulatory Commission is reportedly calling on state pension funds, big banks, and insurers to assist in stabilizing the stock market

  • China plans to lower duty on stock trading by 50%, according to Reuters

  • China's Ministry of Industry is reportedly looking for a 5% increase in the output of ten nonferrous metals in 2024

  • U.S. Commerce Secretary Raimondo will be visiting China between Sunday and Wednesday

  • Major European indices are looking for a higher finish to the week. STOXX Europe 600: +0.5%, Germany's DAX: +0.5%, U.K.'s FTSE 100: +0.5%, France's CAC 40: +0.8%, Italy's FTSE MIB: +1.1%, Spain's IBEX 35: +0.8%.

  • In economic data:

  • Germany's Q2 GDP 0.0% qtr/qtr, as expected (last -0.1%); -0.2% yr/yr, as expected (last -0.2%). August ifo Business Climate Index 85.7 (expected 86.7; last 87.4). August Current Assessment 89.0 (expected 90.0; last 91.4) and Business Expectations 82.6 (expected 83.8; last 83.6)

  • Spain's July PPI -8.4% yr/yr (expected -10.1%; last -8.1%)

  • Swiss Q2 Employment Level 5.432 mln (expected 5.428 mln; last 5.389 mln)

  • In news:

  • Germany's Q2 GDP was revised up to 0.0% from -0.1%, marking the end of a two-quarter recession, but economists from the ifo Institute see another contraction as a near-certainty

  • European Central Bank policymaker Nagel pushed back against reports that the ECB is considering a pause at the September meeting while policymaker Centeno called for caution at the next meeting

  • ECB President Lagarde will speak at the Jackson Hole Symposium at 15:00 ET

 

U.S. equity futures:

  • S&P 500 Futures +10 @ 4,386

  • DJIA Futures: +104 @ 34,203

  • Nasdaq 100 Futures: +11 @ 14,827

Overseas:

  • Europe: DAX +0.5%, FTSE +0.5%, CAC +0.8%

  • Asia: Nikkei -2.1%, Hang Seng -1.4%, Shanghai Composite -0.6%

Commodities:

  • Crude Oil +0.96 @ 80.01

  • Nat Gas -0.001 @ 2.518

  • Gold -1.90 @ 1945.20

  • Silver +0.023 @ 24.253

  • Copper +0.0193 @ 3.7903


 

Earnings/Guidance:

  • Affirm (AFRM) beats by $0.18, beats on revs; guides Q1 revs above consensus

  • Credo Technology Group (CRDO) reports EPS in-line, beats on revs; guides Q2 revs above consensus

  • Domo (DOMO) beats by $0.07, reports revs in-line; guides Q3 EPS below consensus, revs below consensus; guides FY24 EPS below consensus, revs below consensus

  • Gap (GPS) beats by $0.25, reports revs in-line, comps -6%; guides Q3 revs below consensus; guides FY24 revs in-line

  • Hibbett (HIBB) beats by $0.12, reports revs in-line; reaffirms FY24 EPS guidance, revs guidance

  • Intuit (INTU) beats by $0.22, beats on revs; guides Q1 EPS below consensus, revs in-line; guides FY24 EPS above consensus, revs in-line

  • Marvell (MRVL) beats by $0.01, reports revs in-line; guides Q3 EPS in-line, revs in-line

  • Nordstrom (JWN) beats by $0.36, beats on revs; reaffirms FY24 EPS guidance

  • PagSeguro Digital (PAGS) reports Q2 results

  • Stifel Financial (SF) reports operating results for July 31, 2023; total client assets increased 8% yr/yr to $426.7 bln, fee-based client assets up 6%

  • Ulta Beauty (ULTA) beats by $0.17, beats on revs; guides FY24 EPS in-line, revs in-line

  • Workday (WDAY) beats by $0.17, reports revs in-line, Raises FY24 subscription revenue guidance

News:

  • US officials getting more confident that Russian President Putin ordered killing of Yevgeny Prigozhin, according to the New York Times

  • PBOC requests domestic lenders scale back outward bond investments, according to Reuters

  • China plans to lower stamp duty on stock trading by 50%, according to Reuters

  • A tropical storm could form and move into Gulf of Mexico

  • TikTok aiming to ban links to e-commerce websites, according to The Information

  • Technology companies changing online operations as EU rules come into effect today, according to Financial Times

  • Former President Trump posts on X, formerly known as Twitter for first time in 2 years, Politico

  • Alibaba (BABA) introduces AI model that will understand images, according to CNBC

  • Align Tech (ALGN): SmileDirectClub (SDC) announced last night its intention to appeal a decision regarding an award of $63 million to be paid to ALGN following a dispute over the Company's exclusive supply agreement with its former strategic partner

  • Amazon (AMZN) in discussions with Disney (DIS) regarding ESPN streaming partnership, according to The Information

  • AMC Entertainment (AMC) provided investor updates

  • AngloGold Ashanti (AU) appoints Richard Jordinson as COO

  • AngloGold Ashanti Brasil (AU) places Corrego do Sitio mine in Brazil on care and maintenance after sustained operating losses

  • AstraZeneca (AZN) has filed a legal challenge to critical aspects of the drug price negotiation provisions of the Inflation Reduction Act

  • Central Puerto (CEPU) decided on the terms of conditions for the acquisition of own shares issued by the Company for up to $10 mln

  • Decibel Therapeutics (DBTX) announced that the FDA granted fast track designation for DB-OTO, the Company's lead gene therapy product candidate for congenital hearing loss caused by mutations of the otoferlin gene

  • DigitalOcean (DOCN) CEO Yancey Spruill to step down; search underway for new CEO; Warren Adelman named exec chairman; co reaffirms Q3 and FY23 guidance

  • Ericsson (ERIC) and Huawei renew global patent license agreement

  • Equitrans Midstream (ETRN) Provides Rager Mountain Storage Facility Update

  • Fox Corporation (FOXA): FOX News Media's Republican Primary Debate tops all of broadcast and cable television with nearly 13 million viewers across all platforms

  • Hawaiian Electric (HE): Maui County suing HE over fires alleging negligence, according to The AP on MSN

  • Hawaiian Electric (HE) in 8K filing: suspends quarterly dividend beginning with Q3

  • Hawaiian Electric (HE): Co disclosed investor update; expects 95% of customers to in the affected areas will have had their power restored by the end of this week; Hawaiian Electric drew $200 million under their existing revolving unsecured credit facilities

  • Heineken (HEINY) completes exit from Russia

  • Hertz Global (HTZ) expanding electric car fleet in New York City through deal with Revel, according to the New York Post

  • JAMA Neurology (AMRX) Publishes Phase 3 Study Results Comparing IPX203 to Immediate-Release Carbidopa/Levodopa for Parkinson's Disease

  • Kaman (KAMN) announces that James Coogan, Senior Vice President and Chief Financial Officer, will step down from his role as CFO effective August 28, 2023

  • Kinetik (KNTK) promotes Trevor Howard to CFO, effective immediately

  • Lockheed Martin's (LMT) Sikorsky Aircraft Corp awarded $2.77 bln U.S. Navy contract modification

  • Mastercard (MA) and Visa (V) end partnerships with Binance Holdings, according to Bloomberg

  • Merck (MRK) and Eisai (ESAIY) provide update on phase 3 leap-010 trial evaluating keytruda plus lenvima in patients with certain types of recurrent or metastatic head and neck squamous cell carcinoma; study will be closed, and the companies are informing investigators of this decision

  • Merck (MRK) initiates phase 3 clinical program for oral PCSK9 inhibitor candidate MK-0616

  • Meta Platforms (META) Introducing Code Llama, an AI tool for coding

  • Mobileye Global (MBLY) selected by Polestar (PSNY) to to bring autonomous technology to Polestar 4

  • Moog (MOG.A) announces contract with Bell Textron for work on the Bell V-280 Valor, the U.S. Army's Future Long Range Assault Aircraft

  • Novartis AG (NVS) division Sandoz receives FDA approval of TYRUKO

  • Owens Corning (OC) CFO Kenneth S. Parks to resign, effective September 15; succeeded by Todd W. Fister

  • Pan American Silver (PAAS) reports mineral reserves and mineral resources as at June 30, 2023

  • Tesla (TSLA): US could soon resolve Tesla Autopilot investigation, according to Reuters

  • Viasat (VSAT) confirms that I6 F2 satellite has suffered a power subsystem anomaly; does not impact ongoing customer services

  • Warner Brothers Discovery (WBD) delays release of three films, according to the Wall Street Journal

  • WSFS Financial (WSFS) announces that Arthur J. Bacci, Executive Vice President and Chief Wealth Officer, will also serve as interim CFO

  • Zillow (ZG) announced yesterday that Zillow Home Loans offers a 1% down payment option, opening homeownership to more borrowers

M&A:

  • Activision Blizzard (ATVI): UK CMA posts final Decision on possible material change of circumstances or special reason for deciding differently regarding Microsoft (MSFT) merger

  • Akamai Tech (AKAM) acquires select enterprise customer contracts from StackPath, following its decision to cease content delivery network operations; to be accretive to FY24 non-GAAP EPS

  • Blackstone (BX) aiming to sell 22% stake in Bellagio Las Vegas casino, operated by MGM (MGM), according to the Wall Street Journal

  • HollySys (HOLI): Buyer consortium confirms its reiterated non-binding all-cash offer of $25/share, or approximately $1.55 bln to acquire Hollysys

  • Hut 8 Mining (HUT) continues to make progress on the proposed business combination with U.S. Data Mining Group dba US Bitcoin Corp

  • Kimco Realty (KIM) acquires Stonebridge at Potomac Town Center for $172.5 mln

  • Martin Marietta (MLM) to divest certain west coast cement operations to UNACEM

Syndicate:

  • Gracell Biotechnologies (GRCL) files for 183,702,870 ordinary shares by selling shareholders

  • The Trade Desk (TTD) files mixed shelf securities offering

  • Viemed Healthcare (VMD) files $150 mln mixed shelf securities offering

IPOs:

  • Expected to Price:

  • No IPOs expected.

Gapping Up/Down

  • Gapping up:

  • AFRM +8.6%, CRDO +3.8%, WDAY +3.1%, GRCL +2.7%, HSAI +2.5%, AU +1.8%, HOLI+1.5%, ULTA +1.2%, KIM +0.7%, MBLY +0.7%

  • Gapping down:

  • DOMO -30.6%, HE -20.2%, PAGS -6.9%, DOCN -6%, MRVL -3.6%, CEPU -3.4%, ELP-2.4%, HTZ -2.1%, INTU -0.9%, VMD -0.8%, JWN -0.7%, BIP -0.6%

 

Analyst Research (see Upgrades/Downgradescalendarfor full list):

  • Upgrades

  • Abercrombie & Fitch (ANF) upgraded to Equal-Weight from Underweight at Morgan Stanley; tgt raised to $51

  • Ardelyx (ARDX) upgraded to Overweight from Neutral at Cantor Fitzgerald; tgt raised to $10

  • Avista (AVA) upgraded to Sector Weight from Underweight at KeyBanc Capital Markets

  • Cullen/Frost (CFR) upgraded to Neutral from Sell at UBS; tgt raised to $100

  • Netflix (NFLX) upgraded to Buy from Hold at Loop Capital; tgt raised to $500

  • Shift4 Payments (FOUR) upgraded to Equal-Weight from Underweight at Morgan Stanley; tgt raised to $57

  • Downgrades:

  • Clarivate (CLVT) downgraded to Sector Perform from Outperform at RBC Capital Mkts; tgt lowered to $8

  • Crestwood Equity Partners (CEQP) downgraded to Mkt Perform from Outperform at Raymond James; tgt $30

  • Digital Realty Trust (DLR) downgraded to Hold from Buy at Deutsche Bank; tgt raised to $131

  • Domo (DOMO) downgraded to Market Perform from Outperform at TD Cowen; tgt lowered to $14

  • FactSet (FDS) downgraded to Sector Perform from Outperform at RBC Capital Mkts; tgt lowered to $464

  • Fidelity Nat'l Info (FIS) downgraded to In-line from Outperform at Evercore ISI; tgt lowered to $60

  • Frontline (FRO) downgraded to Hold from Buy at Deutsche Bank; tgt $17

  • Olaplex (OLPX) downgraded to Underweight from Neutral at Piper Sandler; tgt lowered to $2

  • Weibo (WB) downgraded to Hold from Buy at The Benchmark Company

  • Others:

  • Advanced Drainage Systems (WMS) initiated with an Overweight at Stephens; tgt $148

  • The Beauty Health Company (SKIN) resumed with a Buy at Canaccord Genuity; tgt $10

  • Western Alliance Bancorp (WAL) resumed with an Overweight at Piper Sandler; tgt $60

  • Zura Bio Limited (ZURA) initiated with an Outperform at Oppenheimer; tgt $17

Econ Data:

  • 10:00 ET: Univ. of Michigan Consumer Sentiment - Final for Aug (Briefing.comConsensus 71.2; Prior 71.2)

  • 10:05 ET: Fed Chair Powell Speech at Jackson Hole

Earnings:

  • Monday (Aug 21)

  • Afternoon: FN NDSN ZM

  • Tuesday (Aug 22)

  • Morning: BIDU BJ CSIQ COTY DKS GDS KC LOW M MDT PINC SCSC SPHR

  • Afternoon:  LZB TOL URBN

  • Wednesday (Aug 23)

  • Morning:  ANF AAP ADI BBWI DY FL GRAB KSS LANC PTON WSM

  • Afternoon:  ADSK GES NTAP NVDA SNOW SPLK ZUO

  • Thursday (Aug 24)

  • Morning: BURL DLTR FRO HAIN NTES OSIS WOOF RY TD WB

  • Afternoon:  AFRM CRDO GPS INTU MRVL JWN ULTA WDAY

 

Asia & Europe detail:

Asia: Nikkei -2.1%, Hang Seng -1.4%, Shanghai Composite -0.6%

Equity indices in the Asia-Pacific region ended the week on a lower note. Japan's Tokyo Core CPI was up 2.8% yr/yr in August, representing the slowest pace of increase since September 2022. China Securities Regulatory Commission is reportedly state pension funds, big banks, and insurers to assist in stabilizing the stock market. China's Ministry of Industry is reportedly looking for a 5% increase in the output of ten nonferrous metals in 2024. U.S. Commerce Secretary Raimondo will be visiting China between Sunday and Wednesday.

  • In economic data:

  • Japan's August CPI 2.6% yr/yr (last 2.5%). August Tokyo CPI 2.9% yr/yr (expected 3.0%; last 3.2%) and Tokyo Core CPI 2.8% yr/yr (expected 2.9%; last 3.0%)

  • Singapore's July Industrial Production 4.1% m/m (expected -0.5%; last 3.3%); -0.9% yr/yr (expected -3.8%; last -6.6%)

---Equity Markets---

  • Japan's Nikkei: -2.1% (+0.6% for the week)

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

  • China's Shanghai Composite: -0.6% (-2.2% for the week)

  • India's Sensex: -0.6% (-0.1% for the week)

  • South Korea's Kospi: -0.7% (+0.6% for the week)

  • Australia's ASX All Ordinaries: -0.9% (-0.5%for the week)

---FX---

  • USD/JPY: +0.1% to 146.01

  • USD/CNH: +0.2% to 7.2934

  • USD/INR: +0.1% to 83.62

 

Europe: DAX +0.5%, FTSE +0.5%, CAC +0.8%

Major European indices are looking for a higher finish to the week. Germany's Q2 GDP was revised up to 0.0% from -0.1%, marking the end of a two-quarter recession, but economists from the ifo Institute see another contraction as a near-certainty. European Central Bank policymaker Nagel pushed back against reports that the ECB is considering a pause at the September meeting while policymaker Centeno called for caution at the next meeting. ECB President Lagarde will speak at the Jackson Hole Symposium at 15:00 ET.

  • In economic data:

  • Germany's Q2 GDP 0.0% qtr/qtr, as expected (last -0.1%); -0.2% yr/yr, as expected (last -0.2%). August ifo Business Climate Index 85.7 (expected 86.7; last 87.4). August Current Assessment 89.0 (expected 90.0; last 91.4) and Business Expectations 82.6 (expected 83.8; last 83.6)

  • Spain's July PPI -8.4% yr/yr (expected -10.1%; last -8.1%)

  • Swiss Q2 Employment Level 5.432 mln (expected 5.428 mln; last 5.389 mln)

---Equity Markets---

  • STOXX Europe 600: +0.5% (+1.2% week-to-date)

  • Germany's DAX: +0.5% (+0.9% week-to-date) 

  • U.K.'s FTSE 100: +0.5% (+1.5% week-to-date)

  • France's CAC 40: +0.8% (+1.5% week-to-date)

  • Italy's FTSE MIB: +1.1% (+2.2% week-to-date)

  • Spain's IBEX 35: +0.8% (+1.4% week-to-date)

---FX---

  • EUR/USD: -0.1% to 1.0807

  • GBP/USD: +0.1% to 1.2616

  • USD/CHF: +0.2% to 0.8853

7 views0 comments

Recent Posts

See All

Comments


bottom of page