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US stocks little changed today as President Trump intends to sign budget bill and declare national emergency

Feb 14, 2019

 

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US Markets End of Day Snapshot

  • US stocks trade sideways today as investors digest news that President Trump will sign the budget bill and then declare a national emergency to build the border wall he wants
  • The S&P 500 finished down 0.27%, Nasdaq Composite up 0.09%, and Russell 2000 up 0.14%
  • US retails sales fell 1.2% in December, coming well below the 0.1% growth expected and down from 0.2% the prior month; these data also weighed on sentiment today
  • News from Beijing is that talks among senior trade officials have yielded little progress as the 2 countries remain at odds over key points of trade negotiations
  • US initial jobless claims for the week of February 9th came at 239,000, above 225,000 expected and in line with 234,000 of the prior week
  • US producer price index (PPI) fell 0.1% in January compared to a 0.1% rise expected
  • US companies have announced USD$140 billion in stock repurchases YTD, a 28% increase vs the first 6 weeks of the year in CY2018.  While the rate of increase is down from 58% Y/Y increase in CY2018, the rate of growth is still double average per annum growth rate for the past 5 years. 
  • Yesterday, we discussed challenges facing S&P 500 companies as they struggle to manage current levels of profitability.  A further dive into the subject underscores the fact that rapid “operating” spending growth has driven the recent stall in operating margin improvement (and in some cases, has led to a slight contraction). Going forward, managing operating expenses, not navigating an environment with higher tariffs or raw materials, will be key to maintaining peak operating margins.
  • The UK Parliament delivered PM Theresa May another defeating, voting against her most recent Brexit plan with only 2 weeks before Britian is due to leave the EU
  • German GDP stagnated in 4Q with reported growth of 0.0%, lagging an average growth rate of +0.2% for the Euro area.  This follows last week’s downward revisions for economic growth for the Euro area by the European Commission (EU). 
  • EU GDP grew at 1.2% y/y in the fourth quarter of 2018, matching consensus and the growth seen in the third quarter
  • Real Estate (+0.45%), Healthcare (+0.23%), and Telecom (+0.22%) stocks were the top performers in the S&P 500 today
  • Industrials (-0.59%), Financials (-1.16%), and Consumer Staples (-1.22%) 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 0.63x
  • 192 stocks in the S&P 500 hit 4-week highs while 5 stocks reached 4-week lows
  • 102 stocks in the S&P 500 closed overbought while 0 stocks closed oversold according to the 16-day RSI Measure
  • 331 stocks in the Nasdaq Composite hit 4-week highs while 24 stocks reached 4-week lows
  • 633 stocks in the Nasdaq Composite closed overbought while 99 stocks closed oversold according to the 16-day RSI Measure
  • The VIX finished flat at 15.56 after closing at 15.65 yesterday
     

Stocks Trending in the News

Click name for Q-Factor rating and financials data.

  • Airbus (ENXTPA: AIR) will cease production of its jumbo A380 airliner.  The 555-seat plane never caught on with airlines as Airbus had hoped.  A number of airlines cut their orders for the plane making it unprofitable to keep the production line open.  Airbus is rated “Neutral” in our European Large-Cap Global Top Stock Ideas.
  • Amazon.com Inc. (AMZN) said in a statement Thursday that it will not move forward with building its headquarters in New York, citing mounting opposition. Amazon also said in its statement that the company will not reopen the search for a replacement location. The US online retail giant will, however, move forward with its planned headquarters in Virginia and Nashville. Amazon is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Consumer Discretionary Global Top Stock Ideas.  
  • Applied Materials (AMAT) reported first quarter 2019 adjusted EPS of USD$0.81 beating consensus of USD$0.79. Applied Materials reported first quarter 2019 net revenue of USD$3.75 billion matching consensus of USD$3.71 billion.  Applied Materials gave second quarter guidance for revenue of USD$3.33-3.63 billion.  Applied Materials is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Information Technology Global Top Stock Ideas.
  • Arch Coal Inc. (ARCH) shares rose after the second-largest producer of coal in the US took a step towards opening a new mine. Arch Coal told investors that it expects to invest up to USD$390mm over the next 3 years to develop the Leer South mine in West Virginia. Arch Coal expects to open the new mine in late 2021. Arch Coal is rated “Top Buy” in our US SMID-Cap Global Top Stock Ideas.  
  • AstraZeneca Plc (LSE: AZN) shares surged the most in nearly 2 years after the company forecasted higher than expected earnings in FY2019. AstraZeneca told investors that it sees FY2019 EPS excluding some items between USD$3.50 and USD$3.70 while analysts had estimated USD$3.56. Jefferies analyst Peter Welford wrote in a note to clients about the financials release, “The focus is on longer-term earnings, for which we forecast an impressive trajectory and improving quality.” AstraZeneca is rated “Unattractive” in our United Kingdom All-Cap Global Top Stock Ideas.  
  • Blackstone Group LP (BX) will acquire half of Taubman Centers Inc. (TCO) shares for about USD$315mm after transaction costs and allocating a share of third party debt to Blackstone. The acquisition comes after Blackstone pledged that it would buy more in Asia after receiving USD$9.4bn from two funds dedicated to the Asia region. Blackstone is rated “Top Short” in our US Large-Cap Global Top Stock Ideas. Taubman Centers is rated “Top Buy” in our US SMID-Cap Global Top Stock Ideas.  
  • Canada Goose Holdings (TSX: GOOS) shares sank after the company told investors that its planned expansion into China came at an unfortunate time.  “We can’t control politicians,” said Canada Goose CEO Dani Reiss, adding, “We’re really happy with our Chinese business plan and the way we plan to approach it. It’d been executed really well.” Canada Goose is not rated in our Global Top Stock Ideas.  
  • CBS Corp (CBS) reported third quarter 2019 adjusted EPS of USD$1.50 missing consensus of USD$1.52.  CBS Corp reported fourth quarter revenue of USD$4.0 billion just below consensus of USD$4.12 billion.  CBS Corp is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Consumer Discretionary Global Top Stock Ideas.
  • Cisco Systems (CSCO) reported second quarter 2019 adjusted EPS of USD$0.73 in line with consensus of USD$0.72.  Cisco Systems reported second quarter total sales of USD$12.4 billion matching consensus of USD$12.42 billion.  Cisco Systems gave third quarter 2019 EPS guidance of 76-78 cents, 76 cents is consensus.  Its dividend was raised 6% and a USD$15 billion share buyback plan was announced.  Cisco Systems is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Information Technology Global Top Stock Ideas.
  • CME Group Inc (CME) reported CY4Q2018 adjusted EPS of USD$1.77 while analysts expected USD$1.73. CME Group Inc generated net sales of USD$1.24bn in CY4Q2018, beating consensus of USD$1.21bn. CME Group Inc is rated "Attractive” in our US Large-Cap Global Top Stock Ideas.
  • Coca-Cola Co. (KO) shares dropped after the company announced CY4Q2018 comparable EPS of USD$0.43 that was in line with consensus for USD$0.43. Coca Cola told analysts that it sees FY2019 EPS growth between –1% and 1% and organic revenue growth of about 4%. Coca-Cola is rated "Neutral” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Consumer Staples Global Top Stock Ideas.
  • Credit Suisse Group AG (SWX: CSGN) announced a larger than expected loss for its Global Markets business of 193mm francs (USD$191mm). The loss in the company’s Global Markets business offset results in the firm’s wealth management and investment banking businesses that beat estimates. Credit Suisse is rated “Unattractive” in our European Large-Cap Global Top Stock Ideas.  
  • Duke Energy Corp (DUK) reported CY4Q2018 adjusted EPS of USD$0.84, slightly missing consensus of USD$0.89. Duke Energy Corp operating revenue of USD$6.12bn in CY4Q2018, beating consensus of USD$5.85bn. Duke Energy Corp expects FY2019 adjusted EPS between USD$4.80 and USD$5.20, the midpoint of which is slightly above consensus of USD$4.95. Duke Energy Corp is rated "Neutral” in our US Large-Cap Global Top Stock Ideas.
  • EQT Corp (EQT) reported CY4Q2018 adjusted EPS of USD$0.79 while analysts expected USD$0.81. EQT Corp generated adjusted cash flow from operations of USD$693.0mm in CY4Q2018, largely beating consensus of USD$415.6mm. EQT Corp expects FY2019 adjusted cash flow from operations between USD$2.2bn and USD$2.3bn. EQT Corp is rated "Unattractive” in our US Large-Cap Global Top Stock Ideas.
  • Incyte Corp (INCY) announced CY4Q2018 adjusted EPS of USD$0.40 while consensus was for USD$0.49. Incyte Corp reported adjusted revenue of USD$468.4mm in CY4Q2018 while analysts expected USD$485.8mm. Incyte Corp is rated "Neutral” in our US Large-Cap Global Top Stock Ideas.
  • IQVIA Holdings Inc (IQV) announced CY4Q2018 adjusted EPS of USD$1.50 while consensus was for USD$1.47. IQVIA Holdings Inc reported net sales of USD$2.69bn in CY4Q2018 while analysts expected USD$2.62bn. IQVIA Holdings Inc sees FY2019 adjusted EPS between USD$6.20 and USD$6.40, the midpoint of which is slightly above consensus of USD$6.24. IQVIA Holdings Inc is rated "Unattractive” in our US Large-Cap Global Top Stock Ideas.
  • Iron Mountain Inc (IRM) reported CY4Q2018 adjusted funds from operations of USD$0.56 while analysts expected USD$0.52. Iron Mountain Inc generated net sales of USD$1.06bn in CY4Q2018, matching consensus of USD$1.06bn. Iron Mountain Inc expects FY2019 adjusted EPS revenue between USD$4.20bn and USD$4.40bn, the midpoint of which is below consensus of USD$4.38bn. Iron Mountain Inc is rated "Neutral” in our US Large-Cap Global Top Stock Ideas.
  • MGM Resorts (MGM) reported fourth quarter adjusted loss of USD$0.06 per share including a 17 cents per share non-recurring income tax expense.  MGM Resorts reported fourth quarter revenue of USD$3.05 billion beating consensus of USD$2.99 billion.   MGM Resorts is rated “Top Short” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Consumer Discretionary Global Top Stock Ideas.
  • NetApp (NTAP) reported third quarter 2019 adjusted EPS of USD$1.20 beating consensus of USD$1.15.  NetApp reported fourth quarter revenue of USD$1.56 billion just below consensus of USD$1.6 billion.  NetApp gave fourth quarter 2019 EPS guidance of USD$1.22-1.28, USD$1.25 is consensus.  NetApp is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Information Technology Global Top Stock Ideas.
  • Nvidia (NVDA) reported fourth quarter adjusted EPS of USD$0.80 beating consensus of USD$0.78.  Nvidia reported fourth quarter total sales of USD$2.21 billion matching consensus of USD$2.2 billion.  Nvidia gave 2019 revenue guidance growth of flat to slightly down, above consensus.  Nvidia is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Information Technology Global Top Stock Ideas.
  • Puma SE (DB: PUM) shares fell after the company reported a FY2019 profit outlook that disappointed investors. Puma sees Ebit to grow by as much as 23% in FY2019 to between 395mm euros and 415mm euros, missing analyst consensus for 428.1mm euros. Puma is rated “Attractive” in our European SMID-Cap Global Top Stock Ideas.
  • Six Flags (SIX) reported fourth quarter adjusted EPS of USD$0.93 which may not compare with consensus of USD$0.25.  Six Flags reported fourth quarter revenue of USD$269.5 million missing consensus of USD$284.4 million.  Six Flags is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Discretionary Global Top Stock Ideas.
  • Tempur Sealy International Inc (TPX) announced CY4Q2018 adjusted EPS of USD$0.90, missing consensus of USD$0.97. Tempur Sealy International Inc reported net sales of USD$646.1mm in CY4Q2018, beating analyst expectations of USD$659.5mm. Tempur Sealy International Inc sees FY2019 adjusted Ebitda between USD$425.0mm and USD$475.0mm, the midpoint of which misses consensus of USD$478.8mm. Tempur Sealy International Inc is rated "Unattractive” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Consumer Discretionary Global Top Stock Ideas.
  • TransUnion (TRU) announced CY4Q2018 adjusted EPS of USD$0.66 while consensus was for USD$0.63. TransUnion reported net sales of USD$613.1mm in CY4Q2018 while analysts expected USD$620.0mm. TransUnion sees FY2019 adjusted EPS between USD$2.57 and USD$2.63, the midpoint of which misses consensus of USD$2.81. TransUnion is rated "Unattractive” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Industrials Global Top Stock Ideas.
  • Waste Management Inc (WM) announced CY4Q2018 adjusted EPS of USD$1.13 while consensus was for USD$1.06. Waste Management Inc reported operating revenue of USD$3.84bn in CY4Q2018 while analysts expected USD$3.78bn. Waste Management Inc sees FY2019 adjusted EPS between USD$4.28 and USD$4.38, the midpoint of which is below consensus of USD$4.44. Waste Management Inc is rated "Top Buy” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Industrials Global Top Stock Ideas.
  • Yelp (YELP) reported fourth quarter adjusted EPS of USD$0.37 in line with consensus of USD$0.36. Yelp reported fourth quarter net revenue of USD$243.7 million matching consensus of USD$241 million.  Yelp is targeting mid-teen revenue growth over the next 5 years.  Yelp is rated “Top Short” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Information Technology Global Top Stock Ideas
  • YETI Holdings Inc (YETI) reported CY4Q2018 adjusted EPS of USD$0.38 while analysts expected USD$0.34. YETI Holdings Inc expects FY2019 adjusted EPS between USD$0.99 and USD$1.04, surpassing consensus of USD$0.93. YETI Holdings Inc is rated "Neutral” in our US SMID-Cap Global Top Stock Ideas.
  • Zoetis Inc (ZTS) reported CY4Q2018 adjusted EPS of USD$0.79 while analysts expected USD$0.77. Zoetis Inc generated net sales of USD$1.56bn in CY4Q2018, beating consensus of USD$1.52bn. Zoetis Inc expects FY2019 adjusted EPS between USD$3.42 and USD$3.52, the midpoint of which surpasses consensus of USD$3.43. Zoetis Inc is rated "Attractive” in our US Large-Cap Global Top Stock Ideas.

 

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US Treasuries

  • US 2-Year Treasury Notes are higher with yields down -3.7 basis points to 2.49%
  • US 5-Year Treasury Bonds are higher with yields down -5.39 basis points to 2.46%
  • US 10-Year Treasury Bonds are higher with yields down -5.21 basis points to 2.65%
  • The US Treasury 2s-5s Spread has narrowed 1.69 basis points to -0.02%
  • The US Treasury 2s-10s Spread has narrowed 1.51 basis points to 0.16%
  • US Treasury 5s-10s Spread has widened 0.18 basis points to 0.18%

Currencies

  • EUR€ is up 0.275% against the USD$ in after hours to 1.1292
  • GBP£ is down 0.397% against the USD$ in after hours to 1.2795
  • CHF is up 0.394% against the USD$ in after hours to 0.9947
  • JPY¥ is down 0.45% against the USD$ in after hours to 110.51

Commodities

  • WTI Crude is up 0.95% to USD$54.41/bbl with the Brent-WTI spread up USD$0.42 to USD$9.86/bbl
  • Gold is up 0.47% to USD$1312.38/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

 

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S&P 500 Movers

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Outperformers Sector Price 1D % Chg Volume
Marathon Oil Corp Energy 15.8 8.75%            3,449,492
Equinix Inc Real Estate 383 7.32%                539,401
IQVIA Holdings Inc Health Care 123 7.06%                504,182
Vulcan Materials Co Materials 100 6.42%                217,231
Zoetis Inc Health Care 84.7 5.68%                294,910
 
Underformers Sector Price 1D % Chg Volume
CenturyLink Inc Communication Services 16.2 -13.06%          12,432,382
American International Group Inc Financials 42.5 -9.03%            4,159,969
International Flavors & Fragrances Inc Materials 133 -8.65%                708,016
Coca-Cola Co/The Consumer Staples 47.6 -8.44%          12,212,023
MGM Resorts International Consumer Discretionary 27.3 -6.36%            4,722,827
Morning BriefA quick GLOBAL RECAP TO START YOUR DAY
Morning BriefA quick GLOBAL RECAP TO START YOUR DAY