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US stocks roar back from near bear market, surging most in 9 years; oil rallies 9.9%

Dec 26, 2018

 

US Markets End of Day Snapshot

  • US stocks surged higher, with strong holiday sales fueling a risk-on sentiment throughout markets; it is the largest single-day increase in US equity markets since March 2009
  • The S&P 500 finished up 4.96%, Nasdaq Composite up 5.84%, and Russell 2000 up 4.96%
  • 355 stocks in the S&P 500 remain oversold according to the 14-day RSI Measure
  • 1188 stocks in the Nasdaq Composite remain oversold according to the 14-day RSI Measure
  • While total trading volume for the US Composite was 2.8% below its 10-day average, total volume turnover was still 25% above its 100-day, suggesting that the recent market moves of the last few weeks have been algo-driven
  • SPY March 19 OTM Puts were some of the most actively traded option contracts today -- their value dropped nearly 50% over the course of the trading session
  • WTI crude is rallying 9.9%, trading at $46.70 as reports circulate of a possible second meeting to discuss additional production cuts
  • The VIX dropped to 30.09 after closing at 36.07 Monday
  • The December Richmond Fed factory gauge fell the most ever, on weaker orders and shipments, coming at -8 while consensus was for 15; this is the fourth regional fed gauge to come below consensus
  • Consumer Discretionary (+6.28%), Energy (+6.24%), and Tech (+6.05%) stocks were the top performers in the S&P 500 today
  • Real Estate (+3.26%), Consumer Staples (+2.84%), and Utilities (+1.56%) stocks were the worst performers in the S&P 500 today
  • US holiday retails sales rose 5.1% compared with a year ago, the strongest growth in 9 years, according to a report in the Wall Street Journal today
  • The US government shutdown continues into its 5th day with no end in sight as Congress is away for the holidays.

Stocks Trending in the News

Click name for Q-Factor rating and financials data.
 

  • Amazon (AMZN) reported “record-breaking” holiday season sales, saying it shipped more items worldwide than it ever has.  Amazon said tens of millions of people stated Prime memberships this holiday season.  Amazon shipped over 1 billion items for free for Prime members.  Amazon is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Discretionary Global Top Stock Ideas.  
  • Chesapeake Energy Corporation (CHK) shares are trading significantly higher after board member Archie Dunham purchased USD$4.13mm worth of company shares. Dunham purchased the shares for a weighted average of USD$1.965/share. The purchase increases Dunham’s total Chesapeake Energy holdings by 29% to 9.35mm shares.  Chesapeake is rated “Neutral” in our US Large-Cap Global Top Stock Ideas. 
  • Disney (DIS) is warning Verizon (VZ) Fios customers that Disney’s channels such as ABS and ESPN may go black on New Year’s Day.  That is when the contract between Verizon and Disney to carry Disney’s channels will expire. Presently, the two do not have a contract signed.  Disney said negotiations are ongoing and it is hopeful to come to a deal.  Disney is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Discretionary Global Top Stock Ideas.  Verizon is rated “Attractive” in our US Large-Cap Global Top Stock Ideas.
  • ExxonMobil (XOM) is on track for its worst year since 1981, according to a Bloomberg report today.  ExxonMobil is in the midst of one of the biggest restructuring efforts ever, a USD$200 billion, 7-year plan.  ExxonMobil has no problem with funding the plan but the time it takes to see the fruit of these efforts could be some time in the future, the story goes on to note.  ExxonMobil is rated “Attractive” in our US Large-Cap Global Top Stock Ideas.
  • Facebook (FB) has its price target set USD$160 by Citron Research today.  Citron described Facebook today saying, “never before has Facebook been such a compelling of an investment opportunity”.  Citron Research is a noted short-seller.  Facebook is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Information Technology Global Top Stock Ideas.
  • GenMark Diagnostics (GNMK) shares are gaining after the company reported that it received FDA 510(k) market clearance for its ePlex Blood Culture Identification Fungal Pathogen Panel. The panel, which was developed together with the ePlex BCID-GP and BCID-GN panels, pertains to the diagnosis and disease management of bloodstream infections that could potentially lead to sepsis. GenMark is rated “Unattractive” in our US SMID-Cap Global Top Stock Ideas. 
  • Hess (HES) said development work will resume off the coast of Guyana after Venezuelan navy ships retreated.  The ships approached the ongoing work of Hess and its partners late last week causing a suspension of seismic mapping that was underway.  Hess suspended work and is only now resuming the mapping.  Hess is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas.
  • Hitachi Construction Machinery Co. (TSE: 6305), the world’s largest maker of construction excavators, said it sees demand in 2019 flat or somewhat lower.  Hitachi Construction Machinery Co. said North America and India will not be able to make up for lagging demand in the rest of the world, as had been the recent trend.  Hitachi Construction Machinery Co. has seen 3 years of strong demand and lower commodity prices as well as trade uncertainly has tamped demand.  Hitachi Construction Machinery Co. is rated “Unattractive” in our Japan Large-Cap Global Top Stock Ideas.  
  • JD.com (JD) announced it approved a USD$1 billion share buyback program.  JD.com last approved a USD$1 billion buyback in September of 2015.  The buyback comes as the end of a year that has seen JD.com stock fall 52%.  JD.com is rated “Top Short” in our China All-Cap Global Top Stock Ideas.
  • Maruti Suzuki India Limited (NSEI: MARUTI), India’s largest automobile manufacturer, has issued an official recall of its Super Carry model. The recall pertains to a potential defect in the fuel filter of 5,900 Super Carry vehicles that were manufactured between April 26th, 2018 and August 1st, 2018. Maruti Suzuki is rated “Unattractive” in our India All-Cap Global Top Stock Ideas.
  • Mastercard (MA) said holiday sales in the US rose 5.1% from a year ago, according to a report in the Wall Street Journal.  That is the strongest growth in 6 years.  Mastercard considers the holiday season to be November 1st until December 24th.  Online sales grew 19.1% while department stores sales fell 1.3%.  Mastercard is rated “Top Buy” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Information Technology Global Top Stock Ideas.  
  • Mitsubishi UFJ Financial Group Inc. (TSE: 8306) has announced the promotion of Deputy Chairman Kanetsugu Mike to replace CEO Nobuyuki Hirano. Hirano will become the new Chairman of Mitsubishi UFJ’s Board of Directors while the company’s stock is down 37% YTD. Mitsubishi UFJ is rated “Top Buy” in our Japan Large-Cap Global Top Stock Ideas.
  • Morgan Stanley (MS) has agreed to pay a USD$10mm fine in order to settle allegations that its anti-money laundering program failed to properly monitor tens of billions of dollars in transactions that passed through brokerage accounts for more than 5 years. Although it agreed to pay the fine, Morgan Stanley never admitted to nor denied the Financial Industry Regulatory Authority’s (FINRA) allegations. Morgan Stanley is rated “Neutral” in our US Large-Cap Global Top Stock Ideas.
  • Roku (ROKU) was named a top pick for 2091 at Needham note to clients today.  Roku has multiple strong drivers in its favor, including favorable demographics, OTT growth, and a low barrier to entry, to name a few.  Roku is small enough to be acquired, a potential exit strategy for shareholders, the note reports. Roku is rated “Top Short” in our US Large-Cap Global Top Stock Ideas.
  • Sharp Corporation (TSE: 6753) will spin-off its electronic device business and laser business into wholly-owned units. The spin-offs will take effect on April 1st, 2019 and aim to revitalize the company’s business relating to 8K, artificial intelligence (AI), and Internet of Things (IoT). Sharp Japan is not rated in our Global Top Stock Ideas.
  • Tesla (TSLA) has been working overtime to deliver vehicles to owners before the end of the year in its usual end-of-year push.  Tesla is trying to maintain strong growth numbers while helping customers take advantage of a tax credit for 2018 that is in effect, which requires the delivery take place before 2018 comes to a close.  Tesla is rated “Top Short” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Consumer Discretionary Global Top Stock Ideas.  

 

US Treasuries

  • US 2-Year Treasury Notes are lower with yields up 6.18 basis points to 2.62%
  • US 5-Year Treasury Bonds are lower with yields up 7.24 basis points to 2.65%
  • US 10-Year Treasury Bonds are lower with yields up 7.31 basis points to 2.81%
  • The US Treasury 2s-5s Spread has widened 1.06 basis points to 0.03%
  • The US Treasury 2s-10s Spread has widened 1.13 basis points to 0.19%
  • US Treasury 5s-10s Spread has widened 0.07 basis points to 0.16%

Currencies

  • EUR€ is down 0.334% against the USD$ in after hours to 1.1354
  • GBP£ is down 0.308% against the USD$ in after hours to 1.2636
  • CHF is down 0.869% against the USD$ in after hours to 1.0042
  • JPY¥ is up 0.934% against the USD$ in after hours to 111.34

Commodities

  • WTI Crude is up 9.19% to USD$46.22/bbl with the Brent-WTI spread little changed USD$0.15 to USD$8.22/bbl
  • Gold is little changed -0.15% to USD$1266.61/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

On Mobile/Tablet scroll to the right.

Outperformers Sector Price 1D % Chg Volume
Newfield Exploration Co Energy 17.6 12.54%            2,852,533
Marathon Oil Corp Energy 16.6 11.93%            4,094,387
Perrigo Co PLC Health Care 64.1 11.51%                925,410
Hess Corp Energy 54.4 11.03%            1,761,897
Kohl's Corp Consumer Discretionary 67.1 10.25%                852,705
 
Underformers Sector Price 1D % Chg Volume
Newmont Mining Corp Materials 32.3 -0.14%            1,318,579
Red Hat Inc Information Technology 178 0.43%                561,437
L3 Technologies Inc Industrials 183 0.51%                287,728
Sempra Energy Utilities 113 0.55%            1,222,125
DTE Energy Co Utilities 118 0.64%                655,636