The S&P 500 futures are up 3 points and are trading 0.1% above fair value. The Nasdaq 100 futures are up 49 points and are trading 0.3% above fair value. The Dow Jones Industrial Average futures are down 55 points and are trading 0.2% below fair value.
The S&P 500 and Nasdaq 100 futures are somewhat higher this morning thanks to some rebound action in the mega cap stocks. Alphabet (GOOG) is an exception in that regard after being downgraded to Market Perform from Outperform at Bernstein. Dow Jones Industrial Average futures trade on the weaker side. A decent loss in Walgreens Boots Alliance (WBA) after its disappointing earnings report has contributed to that weakness.
Quarter end rebalancing activity will be in play again today.
Market participants will also have a slate of economic data to digest that will include:
8:30 ET: May Durable Orders (Briefing.com consensus -1.0%; prior 1.1%) and Durable Orders -ex transportation (Briefing.com consensus 0.0%; prior -0.2%)
9:00 ET: April FHFA Housing Price Index (prior 0.6%) and April S&P Case-Shiller Home Price Index (Briefing.com consensus -2.5%; prior -1.1%)
10:00 ET: June Consumer Confidence (Briefing.com consensus 103.8; prior 102.3) and May New Home Sales (Briefing.com consensus 665,000; prior 683,000)
The 2-yr Treasury note yield is down six basis points to 4.68% and the 10-yr note yield is unchanged at 3.72%. The U.S. Dollar Index is down 0.1% to 102.55.
In corporate news:
Walgreens Boots Alliance (WBA 29.47, -2.12, -6.7%): misses by $0.07, beats on revs; guides FY23 EPS below consensus; immediate actions to improve profitability including $600 million of incremental cost savings
Delta Air Lines (DAL 43.75, +0.61, +1.4%): sees Q2 EPS and revs above consensus; sees FY23 EPS at the top end of prior guidance range
Eli Lilly's (LLY 459.90, +7.14, +1.6%): phase 2 retatrutide results published in The New England Journal of Medicine show the investigational molecule achieved up to 17.5% mean weight reduction at 24 weeks in adults with obesity and overweight
Robinhood Markets (HOOD 9.76, +0.13, +1.4%): cutting roughly 7% of its full-time staff, according to WSJ
Alphabet A (GOOGL 117.42, -0.92, -0.8%): downgraded to Mkt Perform from Outperform at Bernstein
Kellogg (K 67.20, +1.60, +2.4%): upgraded to Buy from Neutral at Goldman
Microsoft (MSFT 330.40, +1.80, +0.6%): CEO Satya Nadella says company aims to reach $500 bln in sales by 2030, according to CNBC
Reviewing overnight developments:
Equity indices in the Asia-Pacific region ended Tuesday on a mixed note. Japan's Nikkei: -0.5%, Hong Kong's Hang Seng: +1.9%, China's Shanghai Composite: +1.2%, India's Sensex: +0.7%, South Korea's Kospi: UNCH, Australia's ASX All Ordinaries: +0.5%.
In economic data:
Japan's May BoJ Core CPI 3.1% yr/yr (expected 3.0%; last 2.9%) o India's Q1 trade deficit $52.6 bln (last deficit of $72.7 bln)
Hong Kong's May trade deficit $26.4 bln (expected deficit of $32.6 bln; last deficit of $36.6 bln). May Imports -16.7% m/m (expected -13.5%; last -11.9%) and Exports -15.6% m/m (expected -17.3%; last -13.0%)
In news:
Chinese banks reportedly intervened in the currency market to support the yuan after the currency reached its lowest level against the dollar since late November. Separately, Chinese banks have reportedly been asked to lend more to manufacturers.
The chairman of China's State-owned Assets Supervision and Administration Commission of the State Council said that global trade is now growing as fast as it had been expected.
Japan's Finance Minister Suzuki said that recent moves in the currency markets have been sharp and one-sided.
Major European indices trade near their flat lines while Spain's IBEX (+0.5%) outperforms thanks to leadership from bank stocks. STOXX Europe 600: -0.2%, Germany's DAX: -0.1%, U.K.'s FTSE 100: -0.1%, France's CAC 40: UNCH, Italy's FTSE MIB: +0.1%, Spain's IBEX 35: +0.5%.
In economic data:
Italy's June Consumer Confidence 108.6 (expected 105.5; last 105.1) and Business Confidence 100.3 (expected 101.0; last 101.2)
In news:
European Central Bank President Lagarde maintained a hawkish tone in remarks made at the two-day Sintra conference. Fed Chairman Powell is scheduled to speak at the conference tomorrow.
There is a growing sense that the ECB will follow its July rate hike with another increase in September.
Germany is reducing its planned debt issuance for Q3 by EUR14 bln.
U.S. equity futures:
S&P 500 Futures: +4 @ 4,333
DJIA Futures: -48 @ 33,667
Nasdaq 100 Futures: +49 @ 14,738
Overseas:
Europe: DAX -0.1%, FTSE -0.1%, CAC UNCH
Asia: Nikkei -0.5%, Hang Seng +1.9%, Shanghai Composite +1.2%
Commodities:
Crude Oil -1.51 @ 67.86
Nat Gas -0.043 @ 2.849
Gold -1.85 @ 1931.95
Silver +0.087 @ 22.913
Copper -0.017 @ 3.7875
Earnings/Guidance:
Abcam ( ABCM 0.00% ) reaffirms FY23 revenue guidance, guides FY24 revenue inline
Applied Digital Corporation ( APLD 0.00% ) guides Q4 (May) revs below consensus; provides business update
Delta Air Lines ( DAL â–´ 0.65% ) sees Q2 EPS and revs above consensus; sees FY23 EPS at the top end of prior guidance range
Korn/Ferry ( KFY â–´ 2.37% ) beats by $0.01, beats on revs; guides Q1 EPS below consensus, revs in-line
Manchester United ( MANU â–¾ 1.11% ) reports Q3 results
Walgreens Boots Alliance ( WBA 0.00% ) misses by $0.07, beats on revs; guides FY23 EPS below consensus; immediate actions to improve profitability including $600 million of incremental cost savings
News:
Russia drops investigation into Yevgeny Prigozhin, according to the New York Times
Treasury Secretary Janet Yellen to visit Beijing in early July; Biden administration executive order potentially cutting offer certain U.S. investments in China nearing completion, according to Bloomberg
European Central Bank President Christine Lagarde says inflation is too high, according to CNBC
NYC grants final approval for congestion pricing plan which will start next year, according to the New York Times
Abcam ( ABCM 0.00% ): Starboard issues statement regarding the opportunity to maximize value at Abcam
Adicet Bio ( ACET 0.00% ) Reports Positive Data from Ongoing ADI-001 Phase 1 Trial in Patients with Relapsed or Refractory Aggressive B-Cell Non-Hodgkin's Lymphoma
AC Immune ( ACIU 0.00% ) receives FDA fast track designation for anti-amyloid-beta active immunotherapy, aci-24.060, to treat alzheimer's disease
Aecom Tech ( ACM â–´ 0.11% ) among several firms competing for $245 mln US Army contract for architect-engineer services for hazardous, toxic and radioactive waste
Aldeyra Therapeutics ( ALDX 0.00% ) announces "positive" top-line results from the Phase 2 clinical trial of orally administered ADX-629
American Express ( AXP â–¾ 0.57% ) announces retirement of Chief Financial Officer Jeffrey Campbell and names deputy Chief Financial Officer Christophe Le Caillec as successor
Amicus Therapeutics ( FOLD 0.00% ) announces approval and launch of new pompe disease therapy in the European Union
Anheuser-Busch InBev ( BUD â–¾ 1.33% ): Bud Light will offer free beer on July 4, according to the New York Post
AstraZeneca ( AZN 0.00% ) announces Xigduo XR approved in China for adults with type-2 diabetes
AutoZone ( AZO â–´ 2.18% ) announces Bill Rhodes' decision to relinquish his positions as President and CEO, effective January 2024
Biogen ( BIIB 0.00% ): Alcyone Therapeutics receives FDA IDE approval to initiate clinical study of the ThecaFlex DRxTM System for Administration of SPINRAZA (
Bristol Myers Squibb ( BMY â–´ 0.01% ) Receives European Commission Approval of CAMZYOS (mavacamten), for the Treatment of Symptomatic Obstructive Hypertrophic Cardiomyopathy
Clearwater Paper ( CLW â–´ 2.41% ) names Rebecca A. Barckley as Interim CFO, effective July 1; currently engaged in search for permanent CFO
Edgewise Therapeutics ( EWTX 0.00% ) announces "positive" 12-month topline results from the ARCH open label study of EDG-5506 in adults with Becker Muscular Dystrophy
eXp World Holdings ( EXPI 0.00% ) enters into amendment with Stephens Inc., increasing repurchase cap to $1.0 bln from $500 mln
Ford ( F â–´ 0.64% ) to eliminate hundreds of jobs, according to Bloomberg
FREYR Battery ( FREY â–´ 3.56% ) announces key achievements ahead of capital markets day
General Dynamics ( GD â–¾ 0.14% ) awarded a $257.6 mln modification to US Army contract
GlaxoSmithKline ( GSK â–¾ 0.30% ) receives FDA Fast Track designation for investigational vaccine against gonorrhoea
Illumina ( ILMN 0.00% ) commencing headcount reduction; expects further staff cuts in Q3 as it commits to lower its annualized run rate expenses by over $100 mln in 2023
Inspired Entertainment ( INSE 0.00% ) signs long-term contract extension with bet365 to continue providing bet365 with the latest products
Jacobs Engineering ( J â–´ 0.51% ) has signed an Engineering Partnering Agreement with Fortescue Future Industries
Korn/Ferry ( KFY â–´ 2.37% ) approved an increase of 20% to the company's quarterly dividend, which is now $0.18 per share
KORU Medical Systems ( KRMD 0.00% ) names Andrew D. C. LaFrence as CFO effective July 10, 2023
Lilly's ( LLY â–¾ 1.33% ) phase 2 retatrutide results published in The New England Journal of Medicine show the investigational molecule achieved up to 17.5% mean weight reduction at 24 weeks in adults with obesity and overweight
Linde plc ( LIN â–´ 0.03% ) signed a series of contracts with Wanhua Chemical Group, expanding the companies' cooperation across multiple key sites in China
Livent ( LTHM â–´ 1.55% ) provides update on fire at Bessemer City manufacturing facility; the fire has subsided and was principally contained to the warehouse portion of a steel and concrete building, although storage area was structurally damaged
MeiraGTx ( MGTX 0.00% ) Announces Positive Clinical Data from the AQUAx Phase 1 Clinical Study of AAV2-hAQP1 for the Treatment of Grade 2/3 Radiation-Induced Xerostomia
Minerals Tech ( MTX â–´ 1.16% ) subsidiary Barretts Minerals to exit the talc business; decision follows strategic review
Mobileye Global ( MBLY 0.00% ) announces that CFO Anat Heller is stepping down, current VP of Finance Moran Rojansky will serve as interim CFO; effective immediately
Nkarta ( NKTX 0.00% ) announces "positive" updated data from its Phase 1 study of NKX101 to treat patients with relapsed or refractory acute myeloid leukemia
Noodles & Co ( NDLS 0.00% ) announces appointment of Michael Hynes as CFO, effective July 24, 2023
Orange ( ORAN â–´ 0.27% ): EU commission sends Orange and MasMovil statement of objections over their proposed joint venture in Spain
Pfizer ( PFE â–¾ 3.68% ): FDA accepts Pfizer's application for hemophilia B gene therapy fidanacogene elaparvovec
Robinhood Markets ( HOOD 0.00% ) inching higher after cutting roughly 7% of its full-time staff, according to the Wall Street Journal
Sanofi ( SNY 0.00% ) reports topline Phase 2b data in atopic dermatitis support amlitelimab as a potential first and best-in-class novel investigational anti-OX40-ligand monoclonal antibody
Scorpio Tankers ( STNG â–¾ 3.04% ) announces commitments for new $1 billion term loan and revolving credit facility
Starbucks ( SBUX 0.00% ) plans clearer guidance for pride merchandise amid dispute with union, according to Bloomberg
TechnipFMC ( FTI â–´ 4.33% ) awarded "significant contract" by Azule Energy to supply subsea production systems offshore Angola
Terns Pharmaceuticals ( TERN 0.00% ) Highlights New Preclinical Data for TERN-601 Program in Obesity at the ADA's 83rd Annual Scientific Session and Upcoming Events
Verona Pharma ( VRNA 0.00% ) submits NDA to FDA for Ensifentrine for the Maintenance Treatment of COPD
Volkswagen AG ( VWAGY ) is committed to developing a sub-$22,000 electric vehicle, according to Inside EVs
M&A:
Alpha Healthcare Acquisition Corp. III ( ALPA 0.00% ) announces the execution of a non-binding letter of intent to acquire a commercial stage regenerative medicine company conditioned upon the closing of ALPA's initial business combination with Carmell Therapeutics Corporation
American Equity Investment Life ( AEL â–´ 10.89% ) receives acquisition proposal from Brookfield Reinsurance for $55.00 per AEL share
Circor ( CIR â–¾ 0.04% ) enters into amendment to definitive merger agreement with KKR (KKR) at $51/share
Microsoft ( MSFT 0.00% ) reportedly considered acquiring Bungie and Sega, according to The Verge
Thomson Reuters ( TRI â–´ 1.18% ) acquires Casetext for $650 mln in cash
Syndicate:
Stratasys ( SSYS 0.00% ): 3D Systems (DDD) submits enhanced proposal to combine with Stratasys
enCore Energy Corp. ( EU â–¾ 4.60% ) announces agreement for at-the-market offering
IDEAYA Biosciences ( IDYA 0.00% ) files mixed shelf securities offering
MoonLake Immunotherapeutics ( MLTX 0.00% commences $250 mln public offering; to use net proceeds to fund the ongoing advancement of Sonelokimab and other general purposes
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:
AEL +9.1%, ALDX +6.3%, MOD +4.6%, INSE +4.5%, TERN +3%, EWTX +2.8%, FREY +2.8%, IQ +2.6%, EGLE +1.6%, EU +1.4%, ABCM +1.2%, EXPI +1%, LLY +1%, HOOD +0.9%, MBLY +0.6%, MSFT +0.5%
Gapping down:
ACET -11.6%, NDLS -4.8%, APLD -4.8%, MLTX -3.3%, FTI -2.5%, IDYA -0.8%, LTHM -0.7%
Analyst Research (see Upgrades/Downgrades calendar for full list):
Upgrades
Guidewire Software (GWRE) upgraded to Buy from Hold at Stifel; tgt raised to $85
Kellogg (K) upgraded to Buy from Neutral at Goldman; tgt raised to $83
Saia (SAIA) upgraded to Outperform from In-line at Evercore ISI
Downgrades:
Adicet Bio (ACET) downgraded to Mkt Perform from Mkt Outperform at JMP Securities
Alibaba (BABA) downgraded to Mkt Perform from Outperform at Bernstein; tgt lowered to $98
Allete (ALE) downgraded to Underperform from Neutral at BofA Securities; tgt lowered to $54
Alphabet A (GOOGL) downgraded to Mkt Perform from Outperform at Bernstein; tgt $125
Ballard Power (BLDP) downgraded to Neutral from Buy at B. Riley Securities; tgt lowered to $5
Equinix (EQIX) downgraded to Hold from Buy at Truist; tgt lowered to $815
Others:
Avita Medical (RCEL) initiated with an Overweight at Cantor Fitzgerald; tgt $23
Frontier Communications Parent (FYBR) initiated with an Outperform at Wolfe Research; tgt $27
Gilat Satellite (GILT) initiated with a Buy at Needham; tgt $7
Mondee Holdings (MOND) initiated with a Mkt Outperform at JMP Securities; tgt $13
Econ Data:
08:30 ET: Durable Orders for May (Briefing.com Consensus -1.0%; Prior 1.1%)
08:30 ET: Durable Orders ex-transportation for May (Briefing.com Consensus 0.0%; Prior -0.2%)
09:00 ET: FHFA Housing Price Index for Apr (Briefing.com Consensus NA; Prior 0.6%)
09:00 ET: S&P Case-Shiller Home Price Index for Apr (Briefing.com Consensus -2.5%; Prior -1.1%)
10:00 ET: Consumer Confidence for June (Briefing.com Consensus 103.8; Prior 102.3)
10:00 ET: New Home Sales for May (Briefing.com Consensus 665K; Prior 683K)
Earnings:
Asia & Europe detail:
Asia: Nikkei -0.5%, Hang Seng +1.9%, Shanghai Composite +1.2%
Equity indices in the Asia-Pacific region ended Tuesday on a mixed note. Chinese banks reportedly intervened in the currency market to support the yuan after the currency reached its lowest level against the dollar since late November. Separately, Chinese banks have reportedly been asked to lend more to manufacturers. The chairman of China's State-owned Assets Supervision and Administration Commission of the State Council said that global trade is now growing as fast as it had been expected. Japan's Finance Minister Suzuki said that recent moves in the currency markets have been sharp and one-sided.
In economic data:
Japan's May BoJ Core CPI 3.1% yr/yr (expected 3.0%; last 2.9%) o India's Q1 trade deficit $52.6 bln (last deficit of $72.7 bln)
Hong Kong's May trade deficit $26.4 bln (expected deficit of $32.6 bln; last deficit of $36.6 bln). May Imports -16.7% m/m (expected -13.5%; last -11.9%) and Exports -15.6% m/m (expected -17.3%; last -13.0%)
---Equity Markets---
Japan's Nikkei: -0.5%
Hong Kong's Hang Seng: +1.9%
China's Shanghai Composite: +1.2%
India's Sensex: +0.7%
South Korea's Kospi: UNCH
Australia's ASX All Ordinaries: +0.5%
---FX---
USD/JPY: +0.2% to 143.73
USD/CNH: -0.3% to 7.2199
USD/INR: UNCH at 81.97
Europe: DAX -0.1%, FTSE -0.1%, CAC UNCH
Major European indices trade near their flat lines while Spain's IBEX (+0.5%) outperforms thanks to leadership from bank stocks. European Central Bank President Lagarde maintained a hawkish tone in remarks made at the two-day Sintra conference. Fed Chairman Powell is scheduled to speak at the conference tomorrow. There is a growing sense that the ECB will follow its July rate hike with another increase in September. Germany is reducing its planned debt issuance for Q3 by EUR14 bln.
In economic data:
Italy's June Consumer Confidence 108.6 (expected 105.5; last 105.1) and Business Confidence 100.3 (expected 101.0; last 101.2)
---Equity Markets---
STOXX Europe 600: -0.2%
Germany's DAX: -0.1%
U.K.'s FTSE 100: -0.1%
France's CAC 40: UNCH
Italy's FTSE MIB: +0.1%
Spain's IBEX 35: +0.5%
---FX---
EUR/USD: +0.4% to 1.0950
GBP/USD: +0.2% to 1.2731
USD/CHF: -0.2% to 0.8938
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