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US stocks lower midday with risk-off sentiment being driven by growth and trade fears

Jan 22, 2019

 

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Market data as of 12 noon EST

US Market Snapshot

  • US stocks are accelerating losses midday with a mixture of trade and growth concerns driving risk-off sentiment today 
  • The S&P 500 is currently down 1.25%, Nasdaq Composite is down 1.47%, and Russell 2000 is down 1.24%
  • US existing home sales fell 6.4% m/m in December to 4.99 million units, coming much worse than the 1.5% fall expected 
  • Yesterday’s release by China’s National Bureau of Statistics that shows China 4Q GDP slowing to 6.4% in CY2018 vs 6.8% in CY2017 has rekindled worries about a deceleration in global growth 
  • Global growth will be in focus this week as the 2019 Annual World Economic Forum in Davos begins today
  • The S&P 500 is on pace to enter an “earnings recession” with expectations for earnings growth for 1Q falling to 5.9% and forecasted 2Q earnings growth falling to 3.6% 
  • 55 members of the S&P 500 has reported 4Q earnings so far with 76.4% beating estimates 
  • Analysis by Bloomberg, Dealogic and Goldman Sachs suggests IPOs as a percentage of the S&P 500 market capitalization is set to double the rolling 5-year average with several maturing unicorns expected to come to market over the next few years.  The expected increase would be the largest increase since 19945 when IPOs spike to more than 3 times the annual average change. 
  • The rally in oil prices YTD in CY2019 is driving the S&P 500 energy sector to be the top performing sector in the S&P 500.  Too fast, too soon?  We will have to wait and see.
  • Utilities (-0.09%), Real Estate (-0.48%), and Healthcare (-0.99%) stocks are the top performers in the S&P 500 today
  • Tech (-1.42%), Industrials (-1.89%), and Energy (-2.05%) 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 0.13x
  • 361 stocks in the S&P500 are at 4-week highs while 0 stocks are at 4-week lows
  • 32 stocks in the S&P 500 are overbought while 0 stocks are oversold according to the 16-day RSI Measure
  • 152 stocks in the Nasdaq Composite are at 4-week highs while 20 stocks are at 4-week lows
  • 912 stocks in the Nasdaq Composite are overbought while 57 stocks are oversold according to the 16-day RSI Measure
  • The VIX is currently moving down at 19.55 from last week's close of 17.8

Stocks Trending in the News

Click name for Q-Factor rating and financials data.

  • Allegheny Technologies Inc. (ATI) reported CY4Q2018 earnings that fell short of analyst estimates despite reporting sales that beat the highest analyst estimate. Allegheny generated USD$1.04bn of sales in CY4Q2018 while analyst estimates ranged between USD$956.0mm and USD$1.03bn. Allegheny’s CY4Q2018 EPS of USD$0.30/share missed analysts’ consensus of USD$0.34/share. Allegheny is rated “Neutral” in our US Large-Cap Global Top Stock Ideas. 
  • Arconic Inc. (ARNC) surprised investors and analysts after the board of directors decided not to sell the company. Arconic fell the most intraday in eight months on the news after the manufacturer said that it, “did not receive a proposal for a full-company transaction that we believe would be in the best interest of Arconic’s shareholders and other stakeholders.” Arconic is rated “Top Short” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Industrials Global Top Stock Ideas. 
  • eBay Inc. (EBAY) activist investor Starboard sent a letter to management urging the company to part ways with StubHub (TCK). Additionally, activist investor Elliott Management Corp sent a letter to management that outlines a five-step plan to review eBay’s portfolio of companies (including StubHub), revitalize its marketplace, and buyback shares. eBay is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Information Technology Global Top Stock Ideas.  
  • Fifth Third Bancorp (FITB) reported fourth quarter adjusted EPS of 69 cents while consensus was for 66 cents.   Fifth Third Bancorp fourth quarter loan loss provisions came at USD$95 million, up from USD$84 million a year earlier.  Fifth Third Bancorp is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas.
  • Halliburton (HAL) reported fourth quarter EPS from continuing operations of 41 cents while consensus was for 37 cents.  Halliburton fourth quarter revenue came at USD$5.9 billion while USD$5.87 billion was consensus.  Halliburton is rated “Attractive” in our US Large-Cap Global Top Stock Ideas.
  • Hugo Boss AG (DB: BOSS) announced CY4Q2018 financials that largely surpassed analyst estimates. Hugo Boss reported CY4Q2018 sales of 783.0mm euros, beating the highest analyst estimates that ranged between 744.0mm euros and 775.0mm euros. Hugo Boss is rated “Attractive” in our European SMID-Cap Global Top Stock Ideas.
  • Johnson & Johnson (JNJ) reported adjusted fourth quarter EPS of USD$1.97 while consensus was for USD$1.95.  Johnson & Johnson fourth quarter revenue came at USD$20.4 billion while USD$20.2 was consensus.  Johnson & Johnson is rated “Attractive” in our US Large-Cap Global Top Stock Ideas.
  • Prologis (PLD) reported CY4Q2018 financials that mostly surpassed analyst expectations. Prologis generated funds from operations of USD$0.80/share in CY4Q2018 while analyst expectations called for USD$0.79/share. Prologis is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas.
  • Stanley Black & Decker (SWK) reported fourth quarter EPS of USD$2.11 while consensus was for USD$2.10.  Stanley Black & Decker fourth quarter revenue came at USD$3.63 billion versus USD$3.62 billion expected.  Stanley Black & Decker sees 2019 EPS coming at USD$8.45-8.65.  Stanley Black & Decker is rated “Attractive” in our US Large-Cap Global Top Stock Ideas. a
  • Steel Dynamics (STLD) reported fourth quarter EPS of USD$1.31 while consensus was for USD$1.21.  Steel Dynamics fourth quarter revenue came at USD$2.9 billion while USD$2.93 billion was consensus.  Steel Dynamics is rated “Neutral” in our US Large-Cap Global Top Stock Ideas.
  • Tesla (TSLA) plans acquire batteries for its new China factory from Panasonic (TSE: 6752), according to Nikkan Kogyo.  The new arrangement will be an expansion of their existing relationship.  Presently, Panasonic is the main supplier of batteries to Telsa.  Tesla is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Information Technology Global Top Stock Ideas.  Panasonic Tesla is rated “Top Buy” in our Japan Large-Cap Global Top Stock Ideas 
  • Travelers (TRV) reported fourth quarter EPS of USD$2.13 while consensus was for USD$2.08.  Travelers fourth quarter revenue came at USD$7.8 billion while USD$7.7 billion consensus.  Travelers return on equity in the fourth quarter was 10.9%.  Travelers is rated “Neutral” in our US Large-Cap Global Top Stock Ideas.
  • UBS (SWX: UBS) reported USD$13 billion withdrawals by its customers.  UBS said it saw USD$8 billion withdrawn from its wealth management unit while USD$5 billion was withdrawn from its asset management unit.  UBS comments that it does not believe the weakness of the fourth quarter has completely passed.  UBS Travelers is rated “Neutral” in our European Large-Cap Global Top Stock Ideas.

 

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US Treasuries

  • US 2-Year Treasury Notes are higher with yields down -3.11 basis points to 2.5828%
  • US 5-Year Treasury Bonds are higher with yields down -4.41 basis points to 2.579%
  • US 10-Year Treasury Bonds are higher with yields down -4.15 basis points to 2.7427%
  • The US Treasury 2s-5s Spread has narrowed 1.3 basis points to 0%
  • The US Treasury 2s-10s Spread has narrowed 1.04 basis points to 0.16%
  • US Treasury 5s-10s Spread has widened 0.26 basis points to 0.16%

Currencies

  • EUR€ is currently little changed against the USD$ at 1.1364
  • GBP£ is currently up 0.52% against the USD$ to 1.2959
  • CHF is currently little changed against the USD$ at 1.0028
  • JPY¥ is currently down 0.283% against the USD$ to 109.36

Commodities

  • WTI Crude is currently down -3.01% to USD$52.18/bbl with the Brent-WTI spread little changed USD$0.11 to USD$8.38/bbl
  • Gold is currently little changed 0.2% to USD$1283.09/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
PG&E Corp Utilities 6.95 10.65%      3,033,895.00
eBay Inc Consumer Discretionary 30.7 6.90%            6,746,315
Fifth Third Bancorp Financials 25.4 2.74%            1,090,008
Cboe Global Markets Inc Financials 92.9 2.26%                  47,169
Chipotle Mexican Grill Inc Consumer Discretionary 515 2.16%                  50,042
 
Underperformers Sector Price 1D % Chg Volume
Arconic Inc Industrials 20.1 -16.81%            2,358,007
Stanley Black & Decker Inc Industrials 129 -13.79%                559,322
Altria Group Inc Consumer Staples 47.9 -6.89%            1,803,158
Halliburton Co Energy 30.3 -6.06%            1,236,585
Micron Technology Inc Information Technology 33.9 -5.03%            3,656,114

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