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US stocks trading flat midday, up from lower levels at the open; WTI below $52

Jan 11, 2019

 

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Market data as of 12:30pm EST

US Market Snapshot

  • US stocks are only flat midday, having trimmed earlier losses despite concerns over the ongoing government shutdown growing; WTI has fallen below the $52 level and is trading at $51.7, down 1.6%
  • The S&P 500 is currently down 0.23%, Nasdaq Composite is down 0.24%, and Russell 2000 is down 0.17%
  • The US Consumer Price Index (CPI) in December rose 1.9% y/y, matching expectation; it fell 0.1% m/m, also matching expectations 
  • Yesterday’s move in the S&P 500 closed the first consecutive 5-day win streak for the benchmark US index since September – Bloomberg technical analysts caution that if history is any type of guide, the S&P 500 will likely retrace the current gains and test the December 24th lows in the near term 
  • The volatility in retail stocks, exacerbated by the moves in department store stocks following yesterday’s negative guidance from Macy’s (M) and disappointing results from Kohls’s Corp (KSS), is beginning to resemble the levels of volatility observed in tech stocks like Apple (AAPL)Applied Materials (AMAT) and Lam Research (LRCX) 
  • President Trump has cut off negotiations with Democrats on funding for a border wall, saying he would “likely” invoke a national emergency to break the impasse and get the funding he wants
  • Consumer Discretionary (+0.2%), Financials (+0.19%), and Consumer Staples (+0.19%) stocks are the top performers in the S&P 500 today
  • Healthcare (-0.33%), Energy (-0.52%), and Utilities (-0.7%) stocks are the worst performers in the S&P 500 today
  • Investor sentiment for US stocks is negative with the advance/decline ratio for the S&P 500 currently at 0.75x
  • 104 stocks in the S&P500 are at 4-week highs while 4 stocks are at 4-week lows
  • 2 stocks in the S&P 500 are overbought while 2 stocks are oversold according to the 16-day RSI Measure
  • 62 stocks in the Nasdaq Composite are at 4-week highs while 18 stocks are at 4-week lows
  • 510 stocks in the Nasdaq Composite are overbought while 33 stocks are oversold according to the 16-day RSI Measure
  • The VIX is currently moving down at 18.59 from yesterday's close of 19.50

Stocks Trending in the News

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  • Activision Blizzard (ATVI) is cutting ties to Bungie Inc, the developer of one of its most successful titles “Destiny”.  The Wall Street Journal is reporting that Activision Blizzard was not happy with the most recent version of the game and had decided to end a collaboration that began in 2008.  Neither company would comment on the story.  Activision Blizzard is rated  “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Information Technology Global Top Stock Ideas.
  • Alibaba (BABA) backed Megvii is considering an IPO that would value the company at up to USD$1 billion.  Megvii is the owner of Face++, the AI-powered facial recognition software.  Megvii hopes to raise USD$500 million, according to press reports.  Alibaba is rated “Unattractive” in our China All-Cap Global Top Stock Ideas.
  • Amazon’s (AMZN) IMDb will launch a free video streaming service that is ad supported.  This will be Amazon’s first ad supported video service and it will be called IMDb Freedive.  Amazon is looking to grab more of the USD$210 billion digital ad market with this service, a market where it had already risen to #3.  Amazon is hiring new ad sellers as it seeks to grow its advertising business.  Amazon is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Consumer Discretionary Global Top Stock Ideas. 
  • Anheuser-Busch Inbev (ENXTBR: ABI) is considering an IPO of its Asian unit, according to a report from Bloomberg.  Anheuser-Busch Inbev is talking to advisers about the potential deal that could raise up to USD$5 billion.  Anheuser-Busch Inbev has been looking for ways to unlock value for shareholders and this could be an obvious choice.  Anheuser-Busch Inbev would look to value to business at USD$70 billion, according to the report.  Anheuser-Busch Inbev is rated “Top Short” in our European Large-Cap Global Top Stock Ideas.
  • Archer Daniels Midland (ADM) is acquiring Florida Chemical Company for USD$175 million from Flotek Industries (FTK).  Florida Chemical Company is a leading provider of citrus oils and fragrances and ADM is adding this acquisition to its stable of natural flavor solutions.  ADM commented that citrus is one of the fastest growing flavor categories.  ADM is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Consumer Staples Global Top Stock Ideas.  Flotek is rated “Top Short” in our US Large-Cap Global Top Stock Ideas.
  • Autoliv (ALV) was upgraded at UBS to buy from hold.  UBS upgraded Autoliv in the wake of the departure of its CEO earlier this week.  Autoliv is not rated is rated in our Global Top Stock Ideas.
  • Geely Automotive (SEHK:175) denied a report that it had sold part of its stake in Daimler (XTRA:DAI).  Bloomberg had earlier reported that Geely Automotive was selling half of its 9.7% stake in Daimler.  Geely vehemently denied this, and in a statement on its website it said that it is a long-term investor in Daimler, that its stake has not changed and that it has no plans to change it.  Daimler is rated “Unattractive” in our European Large-Cap Global Top Stock Ideas.  Geely Automotive is rated “Neutral” in our China All-Cap Global Top Stock Ideas
  • General Motors (GM) surprised investors and provided guidance that was generally upbeat and ahead of expectations.  General Motors expects diluted-adjusted EPS of USD$6.50-7.00., with adjusted automotive free cash flow of between USD$4.5-6.0 billion.  The expectation was for a downbeat guidance report, but General Motors sees demand holding up.  General Motors is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Consumer Discretionary Global Top Stock Ideas.
  • JP Morgan (JPM) is increasing its bonus pool for corporate and investments bankers.  JP Morgan will increase bonuses for equity traders the most as that unit has had the best year.  In the first 9 months of the year JP Morgan’s stock traders generated USD$5.57 billion of revenue, a 22% hike y/y.  JP Morgan is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas.
  • PG&E (PCG) had its credit rating cut to junk status by Moody’s Investor Service.  PG&E was not offered assurances by regulators that it will remain solvent as ratepayers protested against passing the costs on to them.  The path forward for PG&E is not yet clear.  PG&E is rated “Attractive” in our US Large-Cap Global Top Stock Ideas.
  • PVH Corp (PVH) gave guidance that is above consensus estimates.  PVH expects 4Q EPS to be at least USD$1.75 while present consensus is USD$1.61.  PVH expects 4Q revenue of USD$2.4 billion, matching consensus estimates.  PVH is working on efforts to streamline its Calvin Klein operations.  PVH is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Consumer Discretionary Global Top Stock Ideas.
  • Richemont (SWX:CFR) reported fiscal 3Q organic sales growth of 5%, a slowdown from 8%.  The main driver of growth was high-margin Jewelry Maisons business.  Growth was maintained in the Americas and Japan, while slowing in Asia Pacific and declined in Europe.  Vontobel sees growth strengthening in the coming quarter and reiterates its buy.  Richemont is rated “Neutral” in our European Large-Cap Global Top Stock Ideas.
  • Sharp Corp (TSE: 6753) had its price target cut to 1200 yen from 1400 yen by Morgan Stanley, sending the stock on a 10%+ rally.  Morgan Stanley raised the rating of Sharp Corp to equal weight from underweight.  Morgan Stanley believes its challenges will continue and that Sharp will struggle to hit its own targets.  Sharp is not rated is rated in our Global Top Stock Ideas. 
  • Starbucks (SBUX) was downgraded by Goldman Sachs to neutral from buy.  In its Starbucks downgrade, Goldman Sachs cited weaker China growth as a key reason for the downgrade.  Starbucks’ price target was cut to USD$68 from USD$75.  Starbucks recently lowered its long-term earnings growth to ~10% from 12%.  Starbucks is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Consumer Discretionary Global Top Stock Ideas.
  • Volkswagen (XTRA:VOW3) warned investors that 2019 will be a challenging year given uncertain economic condition.  Volkswagen’s CEO said, “The headwinds for our business won’t ease given the geopolitical volatile developments”, joining other carmakers in highlighting what a tough year 2019 may be.  Volkswagen is rated “Neutral” in our Europe Large-Cap Global Top Stock Ideas.

 

Better Data for Better Investment DecisionsBetter Data for Better Investment Decisions

US Treasuries

  • US 2-Year Treasury Notes are higher with yields down -4.09 basis points to 2.53%
  • US 5-Year Treasury Bonds are higher with yields down -4.89 basis points to 2.51%
  • US 10-Year Treasury Bonds are higher with yields down -4.85 basis points to 2.69%
  • The US Treasury 2s-5s Spread has narrowed 0.8 basis points to -0.02%
  • The US Treasury 2s-10s Spread has narrowed 0.7 basis points to 0.16%
  • US Treasury 5s-10s Spread has widened 0.04 basis points to 0.17%

Currencies

  • EUR€ is currently down 0.174% against the USD$ to 1.148
  • GBP£ is currently up 0.894% against the USD$ to 1.2861
  • CHF is currently up 0.177% against the USD$ to 1.0176
  • JPY¥ is currently little changed against the USD$ at 108.41

Commodities

  • WTI Crude is currently down -1.6% to USD$51.75/bbl with the Brent-WTI spread up USD$0.56 to USD$8.07/bbl
  • Gold is currently up 0.29% to USD$1290.39/oz

 

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

S&P 500 Sector ETFs - Intraday

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

Russell 1000 Factor ETFs - Intraday

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

 

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S&P 500 Movers

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Outperformers Sector Price 1D % Chg Volume
General Motors Co Information Technology 34 8.29%            3,159,811
PVH Corp Industrials 91.9 8.14%                204,503
Netflix Inc Real Estate 256 4.48%            2,407,847
Lennar Corp Utilities 39.5 3.28%                321,246
Qorvo Inc Industrials 60.4 2.97%                195,473
 
Underperformers Sector Price 1D % Chg Volume
Activision Blizzard Inc Consumer Discretionary 47 -9.93%            4,953,964
ABIOMED Inc Energy 316 -3.96%                  53,487
Dominion Energy Inc Industrials 73.3 -3.16%                475,687
Intuitive Surgical Inc Health Care 469 -3.03%                106,162
Align Technology Inc Financials 211 -2.65%                121,800

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