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US stocks falter early, stage a rally during the afternoon but peter out with markets closing lower; S&P 500 firmly below 200 day moving average

Oct 23, 2018

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US Markets End of Day Snapshot

  • US stocks sold off early in the day, staged a rally during the afternoon but could not maintain momentum and petered out before the close, with US markets finishing lower
  • The S&P 500 finished down 0.55%, Nasdaq Composite is down 0.42%, and Russell 2000 is down 0.84%
  • Real Estate (+0.69%), Consumer Staples (+0.41%), and Telecom (+0.4%) stocks were the top performers in the S&P 500 today
  • Materials (-1.15%), Industrials (-1.6%), and Energy (-2.67%) stocks were the worst performers in the S&P 500 today
  • Investor sentiment for US stocks finished negative with the advance/decline ratio for the S&P 500 closing at 0.47x
  • 17 stocks in the S&P 500 hit 4-week highs while 142 stocks reached 4-week lows
  • 2 stocks in the S&P 500 closed overbought while 108 stocks closed oversold according to the 16-day RSI Measure
  • 33 stocks in the Nasdaq Composite hit 4-week highs while 447 stocks reached 4-week lows
  • 93 stocks in the Nasdaq Composite closed overbought while 740 stocks closed oversold according to the 16-day RSI Measure
  • The VIX closed up 1.07 points today  to 20.71 after closing at 19.64 yesterday

Stocks Trending in the News

Click name for Q-Factor rating and financials data.
 

  • AMS (AMS SW) has crumbled over 27% today to 36.29 francs after issuing a profit warning.  AMS is a large supplier to Apple (AAPL) and its profit warning worries those who are uncertain how long AMS’ technology will be ahead of other players.  AMS will stop its foray into environmental sensors and focus on photonic elements.  AMS is rated ‘Unattractive’ in our US Large-Cap Global Top Stock Ideas.
  • Anglo American (AAL LN) shares closed 2.5% lower at 1622 pence after its trading update showed a build-up of inventories.  Goldman Sachs published a note highlighting the build-up and the potential for up to USD$500 million negative impact on cash generation.  Anglo American is not likely to clear the inventory in the coming quarter, Goldman Sachs highlights.  Anglo American is rated ‘Neutral’ in our United Kingdom All-Cap Global top Stock Ideas.
  • Asbury Auto (ABG) reported 3Q revenue above the highest expectations, coming at USD$1.76 billion while consensus was USD$1.68 billion.  Asbury Auto 3Q adjusted EPS of USD$2.21 came above the USD$1.88 consensus.  Asbury Auto 3Q gross margin of 15.8% was a bit worse than 16.3% consensus.  Asbury Auto new and used vehicle same-store sales were both 7% higher y/y in 3Q.  Asbury Auto closed 11.2% higher at $66.23.  Asbury Auto is rated ‘Top Buy’ in our US Large-Cap Global Top Stock Ideas and ‘Neutral’ in our US Consumer Discretionary Global Top Stock Ideas.
  • Asian Paints Ltd (APNT IN) closed 5% lower at 1141.3 rupees after reporting 2Q net income and revenue that missed estimates.  Asian Paints delivered net income of 4.93 billion rupees while consensus was for 5.76 billion rupees.  Asian Paints’ revenue of 46.4 billion rupees was below the 47.8 billion rupees expected.  Asian Paints is declining for the fourth day in a row.  Asian Paints is rated ‘Neutral’ in our India All-Cap Global Top Stock Ideas.
  • Atos (ATO FP) cut its forecast due to infrastructure and data management unit.  Atos now sees full-year operating margin at the low end of the 10.5-11% range, citing disappointments in North America and Germany.  Atos sees organic growth coming at the bottom of the 2-3% range.  Atos sees 2019 operating margin 11.5-12%.  Atos closed 22.2% lower at 70.00 euros.  Atos is rated ‘Unattractive’ in our European Large-Cap Global Top Stock Ideas.
  • Avery Dennison (AVY) reported 3Q results that largely met expectations.  Avery Dennison 3Q sales of USD$1.76 billion were in line with USD$1.75 billion consensus.  Avery Dennison adjusted EPS of USD$1.45 came a touch below USD$1.47 consensus.  Avery Dennison increased full-year adjusted EPS guidance by 7 cents per share to USD$4.57-4.92 to reflect a cut in restructuring cost estimates.  Avery Dennison closed 4.7% lower at $92.40.  Avery Dennison is rated ‘Attractive’ in our US Large-Cap Global Top Stock Ideas
  • Bayer (BAYN GR) closed 9.5% lower at 69.27 euros after failing to get the Roundup case thrown out of court.  Bayer had the award lowered to USD$78.6 million from USD$289 million.  Bayer is liable for cancer caused by its product, that did not change.  Bayer has indicated it will appeal the ruling.  Bayer is rated ‘Neutral’ in our US Large-Cap Global Top Stock Ideas.
  • BMW (BMW GR) is expanding a recall to 1.6 million vehicles worldwide related to a possible fluid leak that could cause a fire.  BMW had already recalled 480,000 vehicles for the problem but further investigation revealed a larger problem.  BMW said the recall affects cars manufactured between 2010 and 2017.  BMW closed 1.2% lower at 73.50 euros.  BMW is rated ‘Unattractive’ in our European Large-Cap Global Top Stock Ideas.
  • China Construction Bank (939 HK) reported 3Q profit 6.6% higher and in line with consensus.  China Construction Bank net income came at 67.1 billion yuan.  China Construction Bank saw its net interest margin for the first 9 months come at 2.34%.   China Construction Bank closed 2.3% lower at HKD$6.20.  China Construction Bank is rated ‘Neutral’ in our China All-Cap Global Top Stick Ideas.
  • Fifth Third Bancorp (FITB) reported 3Q results with adjusted EPS of 64 cents coming in line with the 64 cents expected.  Fifth Third Bancorp saw total loans grow by 1% with core deposits remaining flat.  Fifth Third Bancorp saw growth in consumer and C&I loans.  Fifth Third Bancorp closed 2.4% higher at $26.  Fifth Third Bancorp is rated ‘Unattractive’ in our US Large-Cap Global Top Stock Ideas. 
  • GAM Holdings (GAM SW) lost USD$18 billion in assets, cutting its asset under management by 20% in the third quarter.  GAM closed 17% lower at 6.07 francs.  GAM has lost more than half of its market value this year after firing a star portfolio manager earlier in the year for weak risk management procedures.  GAM is rated ‘Neutral’ in our European Large-Cap Global Top Stock Ideas.
  • Honeywell (HON) was upgraded to buy from hold at DZ Bank AG today.  Honeywell saw its price target lowered to $174 from $175.  The upgrade comes in the wake of Honeywell cutting its guidance for full-year EPS to $7.95-8 down from $8.10-8.20.  Honeywell  closed 1.3% lower at $150.60.  Honeywell is rated ‘Neutral’ in both our US Large-Cap and US Industrials Global Top Stock Ideas. 
  • McDonald’s Corp (MCD) closed 6.3% higher at $177.15 after reporting global comparable sales that beat consensus.  McDonald’s Corp served up 4.2% growth in comparable sales even in the face of weak sales in the US.  McDonald’s Corp continues to reap the benefits of its low-cost menu continues that, combined with its remodeling program, will pay dividends over time.  McDonald’s Corp is rated ‘Neutral’ in our US Large-Cap Global Top Stock Ideas and ‘Top Buy’ in our US Consumer Discretionary Global Top Stock Ideas.
  • Nvidia (NVDA) had its price target lowered at UBS to $260 from $285.  UBS expects the ramp-up of its latest products to take longer than the market expects and led to lowering of estimates.  Nvidia closed 4.4% lower at $221.06.  Nvidia is rated ‘Attractive’ in our US Large-Cap Global Top Stock Ideas and ‘Neutral’ in our US Information Technology Global Top Stock Ideas. 
  • Regions Financial (RF) reported 3Q loan growth of 1%.  Regions Financial sees “broad growth across the business and consumer lending portfolios” as business leading grew 2%.  Regions Financial reported 3Q EPS of 37 cents, in line with the 36 cents expected.  Regions Financial closed 0.67% lower at $16.28.  Regions Financial is rated ‘Neutral’ in our US SMID-Cap Global Top Stock Ideas. 
  • Renault (RNO FP) reported weak 3Q results with revenue coming at 11.5 billion euros versus 12.2 billion expected.  Renault now sees growth in China of 2%, down from 5% expected.  Renault confirmed full-year guidance as its emerging markets business continues to suffer weakness.  Renault closed 1% lower at 65.10.  Renault is rated ‘Neutral’ in our European Large-Cap Global Top Stock Ideas.
  • Swedbank (SWEDA SS) does not expect to get pulled into the scandal involving Estonia transfers that Danske (DANSKE SS) is dealing with now, according to Swedbank’s CEO.  Swedbank’s focus on domestic customers over the years has protected it from this type of exposure, she went on to add.   Swedbank delivered 3Q results above expectations with its asset management unit contributing more results than expected on greater inflows.  Swedbank closed 1.9% higher at 196.15 krona, Danske Bank closed 3% lower at 126.60 krona.  Swedbank is rated ‘Attractive’ in our European Large-Cap Global Top Stock Ideas, Danske Bank is rated ‘Top Short’ in our European Large-Cap Global Top Stock Ideas.
  • Tencent (700 HK) backed online broker Futu Securities has filed for an IPO in the US, according to a report in Bloomberg.    The report says the Tencent backed broker is looking to raise USD$300 million, though that is a preliminary number.  Tencent has not finalized the IPO plans and details could change, the report notes.  Tencent closed 4.6% lower at HKD$277.80.  Tencent is rated ‘Attractive’ in our China All-Cap Global Top Stock Ideas.  
  • United Technologies (UTX) forecast full-year EPS of USD$7.20-7.30 above present consensus of USD$7.23.  United Technologies expects full-year net sales of USD$64-64.5 billion, in line with consensus.  United Technologies sees full-year sales growth of 6%, at the top of its earlier 5-6% range.  United Technologies closed 3.4% higher at $130.60 on guidance improvement.  United Technologies is rated ‘Neutral’ in both our US Large-Cap and US Industrials Global Top Stock Ideas.
  • Verizon (VZ) reports adjusted C3Q results which beat Street expectations, though higher than expected subscriber churn tarnished the beat.  Verizon added 515k subscribers in 3Q, well ahead of forecasts, but customer churn inched up to 1.04%.  Verizon  closed 4.1% higher at $57.21.  Verizon is a “Top Buy” in our US Large-Cap Global Top Stock Ideas.
  • Whitbread (WTB LN) reported 1H18 revenue of 1.08 billion pounds.  Whitbread 1H18 adjusted profit came at 269.6 million pounds while adjusted operating profit came at 344 million pounds.  Whitbread expects to open Premier Inn to open 4,00-4,500 rooms in the UK and Germany.  Whitbread closed 1.5% lower at Whitbread is rated ‘Attractive’ in United Kingdom All-cap Global Top Stock Ideas.

US Treasuries

  • US 2-Year Treasury Notes are higher with yields down -3.33 basis points to 2.87%
  • US 5-Year Treasury Bonds are higher with yields down -4.12 basis points to 3.00%
  • US 10-Year Treasury Bonds are higher with yields down -3.21 basis points to 3.16%
  • The US Treasury 2s-5s Spread has narrowed 0.79 basis points to 0.13%
  • The US Treasury 2s-10s Spread has widened 0.12 basis points to 0.29%
  • US Treasury 5s-10s Spread has widened 0.91 basis points to 0.16%

Currencies

  • EUR€ is little changed 0.07% against the USD$ in after hours to 1.1472
  • GBP£ is up 0.17% against the USD$ in after hours to 1.2985
  • CHF is little changed 0.1% against the USD$ in after hours to 1.0049
  • JPY¥ is down 0.346% against the USD$ in after hours to 112.43

Commodities

  • WTI Crude is down -4.18% to USD$66.28/bbl with the Brent-WTI spread down USD$-0.38 to USD$9.61/bbl
  • Gold is up 0.69% to USD$1230.58/oz

*Data in Price Return and Updated Real-Time (with a delay), Source: StockDio

S&P 500 Sector ETFs - End of Day

*Data in Price Return and Updated Real-Time (with a delay), Source: StockDio

Russell 1000 Factor ETFs - End of Day

*Data in Price Return and Updated Real-Time (with a delay), Source: StockDio

S&P 500 Movers

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Outperformers Sector Price 1D % Chg Volume
Cadence Design Systems Inc Information Technology 46.9 15.37%            2,448,950
PulteGroup Inc Consumer Discretionary 22.4 7.28%            2,991,767
McDonald's Corp Consumer Discretionary 177 6.31%            2,320,056
Garrett Motion Inc Industrials 14.7 5.16%                265,170
Verizon Communications Inc Communication Services 57.21 4.06%            5,622,180
 
Underperformers Sector Price 1D % Chg Volume
DISH Network Corp Communication Services 31.8 -8.34%            1,935,493
Caterpillar Inc Industrials 119 -7.56%            3,733,665
Quest Diagnostics Inc Health Care 95.2 -6.22%                582,453
Wynn Resorts Ltd Consumer Discretionary 103 -5.53%            1,532,476
PACCAR Inc Industrials 57.4 -5.12%            1,730,409