top of page
Search

26/06/23 Briefing


The S&P 500 futures are down 3 points and are trading fractionally below fair value. The Nasdaq 100 futures are down 18 points and are trading 0.1% below fair value. The Dow Jones Industrial Average futures are down 3 points and are trading roughly in line with fair value.

There's a softer tone in the stock futures market this morning, but there hasn't been any significant selling. The relative weakness is likely driven by continued consolidation efforts. Also, losses in Tesla (TSLA), which was downgraded to Neutral from Buy at Goldman Sachs, and in Alphabet (GOOG), which was downgraded to Neutral from Buy at UBS, have had an outsized influence on the broader market. 

Separately, reports over the weekend indicated the Wagner military group led an armed uprising against Russian military leadership; however, Yevgeny Prigozhin agreed to halt the march towards Moscow after an agreement was made with Belarus, according to the NY Times. 

Treasury yields are moving lower. The 2-yr note yield is down three basis points to 4.72%. The 10-yr note yield is down five basis points to 3.69%. 

There is no U.S. economic data of note today, but it's a busy week of data that will culminate with the release of the Personal Income and Spending report at 8:30 a.m. ET on Fridaythat will feature the Fed's preferred inflation gauge (the PCE and core-PCE Price Indices).

In corporate news:

  • Tesla (TSLA 251.50, -5.11, -2.0%): downgraded to Neutral from Buy at Goldman Sachs

  • Moderna (MRNA 121.42, +2.92, +2.5%): upgraded to Buy from Neutral at UBS

  • IBM (IBM 129.17, -0.26, -0.2%): to acquire Apptio from Vista Equity Partners for $4.6 bln

  • Alphabet (GOOG 121.32, -1.70, -1.4%): downgraded to Neutral from Buy at UBS

  • Lucid Group (LCID 6.18, +0.70, +12.8%): entered into a definitive agreement to establish a long-term strategic technology partnership with Aston Martin

  • Pfizer (PFE 37.45, -0.90, -2.4%): is continuing to advance the first full agonist oral GLP-1-RA candidate danuglipron toward late-state development, Second GLP-1-RA candidate lotiglipron to be discontinued

  • FibroGen (FGEN 3.70, -12.35, -77.0%): announces topline results from Phase 3 ZEPHYRUS-1 study of pamrevlumab for the treatment of idiopathic pulmonary fibrosis; Study did not meet the primary endpoint

  • Mercury (MRCY 30.76, -4.11, -11.8%): CEO Mark Aslett to resign, effective June 24, following review of strategic alternatives; appoints Bill Ballhaus Interim CEO; will announce new CFO in coming weeks

Reviewing overnight developments:

  • Equity indices in the Asia-Pacific region began the week on a mostly lower note. Japan's Nikkei: -0.3%, Hong Kong's Hang Seng: -0.5%, China's Shanghai Composite: -1.5%, India's Sensex: UNCH, South Korea's Kospi: +0.5%, Australia's ASX All Ordinaries: -0.3%.

  • In economic data:

  • Japan's April Leading Index 0.0% m/m (expected 0.7%; last -0.5%) and Coincident Indicator 0.1% m/m (expected 0.2%; last 0.1%). May Corporate Services Price Index 1.6% yr/yr (expected 1.8%; last 1.6%)

  • Singapore's May Industrial Production -3.9% m/m (expected 1.7%; last -1.6%); -10.8% yr/yr (expected -7.4%; last -6.5%)

  • In news:

  • The Bank of Japan's Summary of Opinions from the June meeting showed that at least one policymaker is open to reviewing yield curve control policy.

  • Japan's top currency diplomat said that recent yen weakness has been rapid and excessive, which has to be dealt with appropriately.

  • China Securities Journal speculated that fiscal support will be increased during the second half of the year, in the form of interest rate and reserve requirement ratio cuts.

  • Major European indices trade on a mostly lower note. STOXX Europe 600: -0.2%, Germany's DAX: -0.2%, U.K.'s FTSE 100: -0.1%, France's CAC 40: +0.2%, Italy's FTSE MIB: -0.2%, Spain's IBEX 35: +0.1%.

  • In economic data:

  • Germany's June ifo Business Climate Index 88.5 (expected 90.7; last 91.5). June Current Assessment 93.7 (expected 93.5; last 94.8) and Business Expectations 83.6 (expected 88.0; last 88.3)

  • U.K.'s June CBI Distributive Trades Survey -9 (expected -6; last -10)

  • Spain's May PPI -6.9% yr/yr (expected -4.5%; last -4.5%)

  • In news:

  • Germany's latest Business Climate Index from the ifo fell to its lowest level of the year.

  • Germany's Wage Commission proposed a 6% increase to the minimum wage for 2024/25 while British Prime Minister Sunak warned against large pay increases for public sector workers.

  • European Central Bank policymakers are increasingly concerned about second-round effects of inflation and a wage-price spiral taking hold.

  • Greek Prime Minister Mitsotakis' gained clear majority in a weekend election, vowing to speed up the implementation of reforms.

 

U.S. equity futures:

  • S&P 500 Futures: -2 @ 4,346

  • DJIA Futures: +10 @ 33,738

  • Nasdaq 100 Futures: -9 @ 14,883

Overseas:

  • Europe:  DAX -0.2%, FTSE -0.1%, CAC +0.2%

  • Asia: Nikkei -1.5%, Hang Seng -1.7%, Shanghai Composite closed for holiday

Commodities:

  • Crude Oil +0.40 @ 69.56

  • Nat Gas -0.008 @ 2.835

  • Gold +12.15 @ 1941.75

  • Silver +0.509 @ 22.863

  • Copper +0.0088 @ 3.8243


 

Earnings/Guidance:

  • Dexcom (DXCM) raises its FY25 financial targets

News:

  • Yevgeny Prigozhin and his military group Wagner led an armed uprising against Russian military leadership. Mr. Prigozhin agreed to halt march towards Moscow after agreement was made with Belarus, according to the New York Times

  • Moscow steps back from civil war with Wagner, but experts warn that danger is not over, according to CNN

  • Oil majors want to diversify into lithium, according to Financial Times

  • 89bio (ETNB) reports Data from ENLIVEN Phase 2b Trial of Pegozafermin in Patients with Nonalcoholic Steatohepatitis (NASH) Published in The New England Journal of Medicine and Simultaneously Presented in a Late-breaker Session at the EASL International Liver Congress

  • Agios Pharma (AGIO) positive results from phase 2 portion of rise up pivotal study in sickle cell disease with both mitapivat dose arms achieving statistically significant hemoglobin response

  • Alphabet's (GOOG)YouTube testing online gaming service, according to the Wall Street Journal

  • Alpha Metallurgical Resources (AMR) provides operational updates; two events contribute to delayed shipments

  • ALX Oncology (ALXO) has received orphan drug designation from the European Commission for the treatment of patients with gastric cancer

  • Amazon (AMZN) is delaying launch of a major expansion of its telemedicine service due to privacy concerns from Congress, according to Politico

  • Amazon (AMZN) and Google (GOOG) aiming to expand investment in India, according to Bloomberg

  • Amazon (AMZN) aiming to introduce local business delivery network, according to Axios

  • Apollo (APO) and other lenders providing as much as $2 billion to Wolfspeed (WOLF), according to Bloomberg

  • Arrowhead (ARWR) Presents Updated Data from Phase 2 SEQUOIA Study of Investigational RNAi Therapy Fazirsiran in Patients with Alpha-1 Antitrypsin Deficiency Liver Disease

  • AstraZeneca (AZN) reports Soliris recommended for approval in the EU by CHMP for children and adolescents with refractory generalised myasthenia gravis

  • Biomea Fusion (BMEA) Presents Positive Clinical Data from the Initial Cohorts of the Ongoing Phase II Study (COVALENT-111) of BMF-219 in Patients with Type 2 Diabetes Mellitus at the American Diabetes Association (ADA) 83rd Scientific Sessions; 100 mg Cohort 3 Demonstrated a 90% Response Rate and 70% Maintained or Improved Time in (Normal Glucose) Range, While Off-Treatment

  • Denison (DNN) Reports Significant Increase in Economic Results for Wheeler River

  • Deutsche Bank (DB) informed investors that some Russian shares are missing, according to Reuters

  • Esperion (ESPR) Presents Results from CLEAR Outcomes Primary Prevention Analysis at 83rd American Diabetes Association Scientific Sessions

  • FibroGen (FGEN) announces topline results from Phase 3 ZEPHYRUS-1 study of pamrevlumab for the treatment of idiopathic pulmonary fibrosis; Study did not meet the primary endpoint

  • Ford (F): US to probe Ford Explorer recalls, according to Reuters

  • Genesco (GCO) announces that its board of directors has authorized a $50 million increase to its existing $200 million share repurchase authorization

  • GlaxoSmithKline (GSK) receives positive CHMP opinion recommending authorisation of daprodustat for symptomatic anaemia associated with chronic kidney disease in adults on chronic maintenance dialysis

  • GlaxoSmithKline (GSK) receives approval for Shingrix in Japan

  • Goldman (GS) aiming to eliminate 125 managing director positions, according to Bloomberg

  • Google (GOOG) could exit Hong Kong amid censorship concerns, according to the New York Post

  • Heron Therapeutics (HRTX) appoints Ira Duarte as CFO

  • Huntington Ingalls (HII) awarded a $274 mln incentive and $119 mln modification to previously awarded US Navy contracts

  • Innate Pharma (IPHA) reports First Patient Dosed in Phase 2 MATISSE Trial of IPH5201 in Early Stage Lung Cancer

  • JD.com(JD) plans to create new groceries unit, according to Bloomberg

  • Lexicon (LXRX) Announces Planned Advancement of LX9211Into Late-Stage Development

  • Lilly's (LLY) SURMOUNT-2 results published in The Lancet show tirzepatide achieved a mean weight reduction of 15.7% at the highest dose (15 mg) in adults with obesity or overweight and type 2 diabetes

  • Lilly's (LLY) phase 2 results published in the New England Journal of Medicine show orforglipron, a once-daily oral nonpeptide GLP-1 receptor agonist, achieved up to 14.7% mean weight reduction at 36 weeks in adults with obesity or overweight

  • Lucid Group (LCID) entered into a definitive agreement to establish a long-term strategic technology partnership with Aston Martin

  • Medtronic (MDT) presents new data on MiniMed 780G system on fixed meal dosing and real-world Time in Range across wide variety of users

  • Mercury (MRCY) CEO Mark Aslett to resign, effective June 24, following review of strategic alternatives; appoints Bill Ballhaus Interim CEO; will announce new CFO in coming weeks

  • MoonLake Immunotherapeutics (MLTX) achieves landmark milestone with positive Phase 2 results for Nanobody sonelokimab in hidradenitis suppurativa

  • New Found Gold Corp. (NFGC) provides update on industry-leading 3-d seismic survey at its Queensway gold project

  • Novo Nordisk A/S (NVO) reports new data show once-weekly insulin icodec met additional endpoints in adults with type 2 diabetes in phase 3a trials

  • Nvidia (NVDA) likely to invest in Europe, according to Bloomberg

  • Papa John's (PZZA) appoints Ravi Thanawala As Chief Financial Officer

  • Pfizer (PFE) receives FDA approval for LITFULO

  • Pfizer (PFE) provides update on GLP-1-ra clinical development program for adults with obesity and type 2 diabetes mellitus

  • Pharvaris N.V. (PHVS) announces FDA removal of clinical hold of deucrictibant for the on-demand treatment of HAE

  • Rallybio (RLYB) Announces Proof-of-Concept Results and Development Updates for RLYB212, a Novel Monoclonal anti-HPA-1a Antibody to Prevent Fetal and Neonatal Alloimmune Thrombocytopenia

  • Sanofi (SNY) reports ALTUVIIIO late-breaking data at ISTH demonstrates highly effective bleed protection in children with severe hemophilia A with once-weekly dosing

  • SolarWinds (SWI) provides update on "Wells Notices" relating to cyber incident; SEC makes preliminary determination to recommend SEC file a civil enforcement action

  • Sotera Health (SHC) announces Jon Lyons as CFO

  • Starbucks (SBUX) workers strike at some stores, according to the Wall Street Journal

  • Supernus Pharma (SUPN) settles ongoing patent litigation with Apotex regarding its generic version of Oxtellar XR

  • Takeda Pharma (TAK) reports Pivotal Phase 3 Data Presented at ISTH 2023 Congress Spotlight TAK-755 Prophylaxis for Patients with Congenital Thrombotic Thrombocytopenic Purpura

  • TotalEnergies SE (TTE) and Aramco award contracts for $11 bln Amiral Project

  • Vertex (VRTX) Presents Positive VX-880Results From Ongoing Phase 1/2 Study in Type 1 Diabetes at the American Diabetes Association 83rd Scientific Sessions

  • Vertex Pharma (VRTX) and Lonza announce a strategic collaboration to support the manufacture of Vertex's portfolio of investigational stem cell-derived, fully differentiated insulin-producing islet cell therapies for people with T1D, currently focusing on the VX-880and VX-264programs that are currently in clinical trials

  • Vir Biotechnology (VIR) and VBI Vaccines (VBIV) announces new data from partners underscoring potential for HBV Functional Cure at EASL Congress 2023

  • Vir Biotechnology (VIR) Presents New Data Evaluating the Potential for VIR-2218 and VIR-3434 as Therapies for Chronic Hepatitis B and Hepatitis D

M&A:

  • IBM (IBM) to acquire Apptio from Vista Equity Partners for $4.6 bln

  • LL Flooring (LL) Holdings Board of Directors unanimously rejects unsolicited proposal from cabinets to go, subsidiary of F9 Brands, Inc.

  • Nordson (NDSN) has entered into a definitive agreement to acquire ARAG Group and its subsidiaries in an all-cash transaction that values ARAG at an enterprise value of 960 mln

  • PacWest Bancorp (PACW): Ares Management (ARES) acquires $3.5 billion lender finance portfolio from Pacific Western Bank

  • SL Green Realty (SLG) announced that it has sold a 49.9% interest in 245 Park Avenueto a U.S. affiliate of Mori Trust Co., Ltd. at a gross asset valuation of $2.0 bln

  • Whole Earth Brands (FREE): Sababa proposes to acquire FREE for $4.00/share

Syndicate:

  • Agenus (AGEN) files mixed securities shelf offering

  • Alto Ingredients (ALTO) files $100 mln mixed shelf securities offering

  • Amerant Bancorp (AMTB) files $300 mln mixed shelf securities offering

  • American Water Works (AWK) announces that it intends to offer $900 million aggregate principal amount of its Exchangeable Senior Notes due 2026

  • Columbus McKinnon (CMCO) files mixed shelf securities offering

  • CymaBay Therapeutics (CBAY) files for 4,642,857 share common stock offering, relates to warrants

  • Digimarc (DMRC) files for $100 mln mixed securities shelf offering

  • Enliven Therapeutics (ELVN) files for $400 mln mixed securities shelf offering

  • Hagerty (HGTY) raises $105 mln in capital from existing strategic investors for profitable growth initiatives

  • NextNav (NN) files for 25,925,927 shares of common stock by selling shareholders, relates to warrants

  • Presto Automation (PRST) files for 7,260,500 share common stock offering by selling shareholders

IPOs:

  • IPOs Expected to Price:

  • Fidelis Insurance (NYSE: FIHL): The global reinsurance company with operations in Bermuda, Irelands, and the UK is expected to price its 17.0 M share IPO between $16-$19.

  • Kodiak Services (NYSE: KGS): The leading operator of contract compression infrastructure in the United States is expected to price its 16.0 M share IPO between $19-$22.

  • Savers Value Village (NYSE: SVV): The largest for-profit thrift operator in the United States and Canada is expected to price its 18.8 M share IPO between $15-$17.

Gapping Up/Down

  • Gapping up:

  • BMEA +27.8%, LCID +8.4%, MLTX +8.2%, ETNB+7.1%, IPHA +6.6%, LXRX +5.1%, LL +4.7%, ESPR+3.8%, CDLX +2.9%, ALTO +1.7%, NN +1%, VRTX+0.8%, AZN +0.7%

  • Gapping down:

  • MRCY -9.7%, SUPN -5%, PRST -3.1%, ELVN -2.8%, CBAY -1.9%, RLYB -1.6%, SWI -1.3%, AMR -0.5%

 

Analyst Research (see Upgrades/Downgradescalendarfor full list):

  • Upgrades

  • Alliant Energy (LNT) upgraded to Buy from Neutral at BofA Securities; tgt raised to $58

  • Burlington Stores (BURL) upgraded to Buy from Accumulate at Gordon Haskett; tgt lowered to $175

  • Moderna (MRNA) upgraded to Buy from Neutral at UBS; tgt lowered to $191

  • Sherwin-Williams (SHW) upgraded to Outperform from Market Perform at BMO Capital Markets; tgt raised to $275

  • Sotera Health (SHC) upgraded to Overweight from Sector Weight at KeyBanc Capital Markets; tgt $24

  • WSFS Financial (WSFS) upgraded to Buy from Neutral at DA Davidson; tgt raised to $45

  • Downgrades:

  • Ashland (ASH) downgraded to Market Perform from Outperform at BMO Capital Markets; tgt lowered to $90

  • Celanese (CE) downgraded to Market Perform from Outperform at BMO Capital Markets; tgt lowered to $119

  • Lloyds Banking (LYG) downgraded to Underweight from Equal Weight at Barclays

  • Mercury (MRCY) downgraded to Neutral from Overweight at JP Morgan; tgt lowered to $37

  • Playa Hotels & Resorts (PLYA) downgraded to Underperform from Buy at BofA Securities; tgt lowered to $8

  • Ross Stores (ROST) downgraded to Accumulate from Buy at Gordon Haskett; tgt $120

  • Tesla (TSLA) downgraded to Neutral from Buy at Goldman; tgt raised to $248

  • World Kinect Corporation (WKC) downgraded to Underperform from Buy at BofA Securities; tgt lowered to $22

  • Others:

  • Allogene (ALLO) assumed with an Outperform at Oppenheimer; tgt $28

  • Alpine Immune Sciences (ALPN) assumed with an Outperform at Oppenheimer; tgt $14

  • Arvinas (ARVN) assumed with an Outperform at Oppenheimer; tgt $95

  • Brinker (EAT) initiated with an Underweight at Wells Fargo; tgt $31

  • Cheesecake Factory (CAKE) initiated with an Equal Weight at Wells Fargo; tgt $33

  • Cross Country (CCRN) initiated with a Outperform at William Blair

  • Cue Biopharma (CUE) assumed with an Outperform at Oppenheimer; tgt $10

  • Elastic (ESTC) resumed with a Mkt Perform at William Blair

  • EnLink Midstream (ENLC) initiated with a Buy at UBS; tgt $14

  • ESSA Pharma (EPIX) assumed with an Outperform at Oppenheimer; tgt $17

  • ImaRx Therapeutics (IMRX) assumed with an Outperform at Oppenheimer; tgt $25

  • MongoDB (MDB) initiated with an Equal Weight at CapitalOne; tgt $396

  • Nurix Therapeutics (NRIX) assumed with an Outperform at Oppenheimer; tgt $25

  • Seres Therapeutics (MCRB) assumed with an Outperform at Oppenheimer; tgt $12

  • Texas Roadhouse (TXRH) initiated with an Equal Weight at Wells Fargo; tgt $113

  • Western Midstream (WES) initiated with a Neutral at UBS; tgt $27

Econ Data:

  • No economic data of note.

Earnings:

Asia & Europe detail:

Asia: Nikkei -0.3%, Hang Seng -0.5%, Shanghai Composite -1.5%

Equity indices in the Asia-Pacific region began the week on a mostly lower note. The Bank of Japan's Summary of Opinions from the June meeting showed that at least one policymaker is open to reviewing yield curve control policy. Japan's top currency diplomat said that recent yen weakness has been rapid and excessive, which has to be dealt with appropriately. China Securities Journal speculated that fiscal support will be increased during the second half of the year, in the form of interest rate and reserve requirement ratio cuts.

  • In economic data:

  • Japan's April Leading Index 0.0% m/m (expected 0.7%; last -0.5%) and Coincident Indicator 0.1% m/m (expected 0.2%; last 0.1%). May Corporate Services Price Index 1.6% yr/yr (expected 1.8%; last 1.6%)

  • Singapore's May Industrial Production -3.9% m/m (expected 1.7%; last -1.6%); -10.8% yr/yr (expected -7.4%; last -6.5%

---Equity Markets---

  • Japan's Nikkei: -0.3%

  • Hong Kong's Hang Seng: -0.5%

  • China's Shanghai Composite: -1.5%

  • India's Sensex: UNCH

  • South Korea's Kospi: +0.5%

  • Australia's ASX All Ordinaries: -0.3%

---FX---

  • USD/JPY: -0.4% to 143.05

  • USD/CNH: +0.4% to 7.2386

  • USD/INR: +0.1% to 82.04

 

Europe: DAX -0.2%, FTSE -0.1%, CAC +0.2%

Major European indices trade on a mostly lower note. Germany's latest Business Climate Index from the ifo fell to its lowest level of the year. Germany's Wage Commission proposed a 6% increase to the minimum wage for 2024/25 while British Prime Minister Sunak warned against large pay increases for public sector workers. European Central Bank policymakers are increasingly concerned about second-round effects of inflation and a wage-price spiral taking hold. Greek Prime Minister Mitsotakis' gained clear majority in a weekend election, vowing to speed up the implementation of reforms.

  • In economic data:

  • Germany's June ifo Business Climate Index 88.5 (expected 90.7; last 91.5). June Current Assessment 93.7 (expected 93.5; last 94.8) and Business Expectations 83.6 (expected 88.0; last 88.3)

  • U.K.'s June CBI Distributive Trades Survey -9 (expected -6; last -10)

  • Spain's May PPI -6.9% yr/yr (expected -4.5%; last -4.5%)

---Equity Markets---

  • STOXX Europe 600: -0.2%

  • Germany's DAX: -0.2%

  • U.K.'s FTSE 100: -0.1%

  • France's CAC 40: +0.2%

  • Italy's FTSE MIB: -0.2%

  • Spain's IBEX 35: +0.1%

---FX---

  • EUR/USD: +0.1% to 1.0906

  • GBP/USD: -0.1% to 1.2699

  • USD/CHF: -0.4% to 0.8927


1 view0 comments

Recent Posts

See All

Comments


bottom of page