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US stocks creep higher, with positive sentiment driven by Walmart (WMT) earnings, trade optimism

Feb 19, 2019

 

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US Markets End of Day Snapshot

  • US stocks creep higher, posting slight gains, with positive sentiment driven by Walmart (WMT) earnings and trade optimism
  • The S&P 500 finished up 0.15%, Nasdaq Composite up 0.19%, and Russell 2000 up 0.33%
  • Walmart (WMT) reported a 4.2% rise in sales this morning and provided same-store sales guidance of 2.5-3% in 2019, allaying fears of a retail slowdown in the US
  • US and Chinese negotiators will continue trade talks this week, looking to build on the momentum of last week 
  • The US is asking China to keep the yuan stable as part of the negotiations, Bloomberg reports
  • NAHB Housing Market Index for February came at 62, above 59 expected and up from 58 in January
  • European officials made clear again they will hike import tariffs on US goods if the US lets auto tariffs increase on European auto imports on March 1st 
  • The European Central Bank's chief economist said the ECB could push back any rate hike if the economy weakens, spooking investors
  • The head of the Bank of Japan told Parliament he would provide more stimulus to the economy if required
  • Materials (+0.58%), Utilities (+0.54%), and Consumer Staples (+0.5%) stocks were the top performers in the S&P 500 today
  • Tech (+0.02%), Industrials (-0.07%), and Healthcare (-0.25%) stocks were the worst performers in the S&P 500 today
  • Investor sentiment for US stocks finished positive with the advance/decline ratio for the S&P 500 closing at 1.45x
  • 213 stocks in the S&P 500 hit 4-week highs while 4 stocks reached 4-week lows
  • 122 stocks in the S&P 500 closed overbought while 1 stock closed oversold according to the 16-day RSI Measure
  • 445 stocks in the Nasdaq Composite hit 4-week highs while 24 stocks reached 4-week lows
  • 804 stocks in the Nasdaq Composite closed overbought while 98 stocks closed oversold according to the 16-day RSI Measure
  • The VIX finished flat at 15.03 after closing at 14.91 last week

Stocks Trending in the News

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  • Advanced Auto Parts (AAP) reported fourth quarter adjusted EPS of USD$1.17 beating consensus of USD$1.13.  Advanced Auto Parts reported fourth quarter sales of USD$2.11 billion matching consensus of USD$2.11 billion.  Advanced Auto Parts sales grew 3.4% in the fourth quarter.  Advanced Auto Parts is rated “Neutral” in our Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Discretionary Global Top Stock Ideas
  • The Blackstone Group LP (BX) shares traded higher after Targa Resources Corp. (TRGP) agreed to sell a 45% stake in its oil and natural gas pipeline and storage business to investment firms backed by the private equity company. According to CEO Joe Bob Perkins, the deal will provide Targa with a, “substantial portion of our estimated 2019 equity funding needs,” Blackstone is rated “Top Short” in our US Large-Cap Global Top Stock Ideas. Targa is rated “Top Short” in our US Large-Cap Global Top Stock Ideas.  
  • China International Capital Corp. (SEHK: 3908) shares traded higher after Alibaba Group Holding Ltd. (BABA) increased its stake in the investment bank. Alibaba increased its stake in China International Capital Corp. by 117.1mm shares, or HK$1.8bn (USD$230mm). Alibaba’s stake in China International Capital Corp. is now 11.7%, nearly matching Tencent Holdings Limited’s (SEHK: 700)12% stake in the investment bank. China International Capital Corp. is rated “Neutral” in our China All-Cap Global Top Stock Ideas. Alibaba is rated “Top Buy” in our China All-Cap Global Top Stock Ideas. Tencent is rated “Attractive” in our China All-Cap Global Top Stock Ideas.
  • Danone (ENXTPA:BN) gave 2019 guidance for 3% sales growth with sales with full year operating income of 3.56 billion euros.  Danone expects recurring operating margin above 15%.  Danone expects EPS of 3.84 euros.  Danone is rated “Neutral” in our European Large-Cap Global Top Stock Ideas.
  • Devon Energy (DVN) reported fourth quarter core EPS of USD$0.10 well below consensus of USD$0.30.  Devon Energy will be separating its Canadian and Barnett assets and expects to complete that by the end of 2019.  Devon Energy increased its quarterly dividend to 9 cents per share from 8 cents and increased its share buyback program to USD$5 billion from USD$4 billion.  Devon Energy is rated “Neutral” in our Large-Cap Global Top Stock Ideas.
  • Diamondback Energy (FANG) reported fourth quarter adjusted EPS of USD$1.21 missing consensus of USD$1.58.  Diamondback Energy reported fourth quarter adjusted ebitda of USD456.5 million missing consensus of USD485.3 million.  Diamondback Energy saw production of 16,816 mboe/day in the fourth quarter.  Devon Energy is rated “Unattractive” in our Large-Cap Global Top Stock Ideas.
  • Hang Seng Bank Limited (SEHK: 11) announced FY2018 financials that broadly surpassed analyst expectations. Hang Seng Bank reported HK$24.21bn of net income in FY2018 while consensus was for HK$23.38bn. Hang Seng Bank also told investors that it expects Hong Kong GDP growth of 2.7% in 2019, down from the expected 3.3% growth in 2018. Hang Seng Bank is rated “Neutral” in our China All-Cap Global Top Stock Ideas.
  • Herbalife Nutrition (HLF) reported fourth quarter adjusted EPS of USD$0.63 beating consensus of USD$0.60.  Herbalife Nutrition reported fourth quarter sales of USD$1.19 billion matching consensus of USD$1.19 billion.  Herbalife Nutrition is not rated in our Global Top Stock Ideas.
  • Honda (TSE:7267) said it will close its factory in England which is being seen as a blow to Brexit.  Honda will close a factory located in Swindon, located about 80 miles outside of London.  The factory will close in 2021 and presently employs 3,500 workers.  Honda is rated “Top Buy” in our Japanese Large-Cap Global Top Stock Ideas.
  • HSBC Holdings Plc (LSE: HSBA) shares dipped after missing CY4Q2018 consensus and warning investors that rising political tensions have made the outlook for 2019 far less predictable. HSBC Holdings chairman Mark Tucker said on a conference call, “There are more risks to global economic growth than this time last year, and we remain alive and responsive to all possibilities.” HSBC Holdings reported adjusted pretax profit of USD$3.39bn in CY4Q2018 while analysts expected USD$4.40bn. HSBC Holdings is rated “Neutral” in our United Kingdom All-Cap Global Top Stock Ideas.
  • Kia Motors (KOSE: A000270) shares were downgraded from buy to hold by KB Securities. KB Securities maintains a price target for Kia Motors shares of 40,000 won, implying a 12% upside from the stock’s last close. Kia Motors maintains an average price target of 36,695 won across 35 analyst estimates. Kia Motors is not rated in our Global Top Stock Ideas.
  • Leidos Holdings Inc. (LDOS) shares slipped after Cowen wrote in a note to clients that, “investors may be neutral or possibly disappointed,” with the company’s financial results. Leidos reported CY4Q2018 financials that were in-line with consensus but, “lagged blowouts,” at Booz Allen Hamilton Holding Corporation (BAH) and Caci International (CACI). Leidos is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Information Technology Global Top Stock Ideas. Booz Allen is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Information Technology Global Top Stock Ideas. Caci International is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Information Technology Global Top Stock Ideas.  
  • Lululemon (LULU) was downgraded to by Nomura Instinet to neutral from buy.  Nomura Instinet made the downgrade based solely on valuation after the stock ran 24%.  The price target was hiked to USD$157 from USD$140 together with the rating drop.  Lululemon is rated “Attractive” in our Large-Cap Global Top Stock Ideas.
  • ProSiebenSat.1 Media SE (XTRA: PSM) shares slipped following reports that key executives are clashing with CEO Max Conze over the firm’s strategy. According to the report, CFO Jan Kemper will likely depart the German broadcaster shortly. Chief Commercial Officer Sabine Eckhardt also will not renew her contract at the end of 2019, according to the report. ProSiebenSat.1 Media is rated “Neutral” in our European SMID-Cap Global Top Stock Ideas.
  • Sage Therapeutics (SAGE) reported fourth quarter adjusted loss per share of USD$3.83 missing consensus of a loss of USD$2.97.  Sage Therapeutics reported fourth quarter total expenses of USD$164.5 million.  Sage Therapeutics sees funding in place until second half of 2020.  Sage Therapeutics is rated “Top Short” in our Large-Cap Global Top Stock Ideas.
  • SiteOne Landscaping (SITE) reported fourth quarter adjusted loss per share of USD$0.01 beating consensus of a loss of USD$0.06.  SiteOne Landscaping reported fourth quarter revenue of USD$474.6 million matching consensus of USD$473.1 million.  SiteOne Landscaping saw total sales growth 14% with organic sales growth of 4%.  SiteOne Landscaping is rated “Unattractive” in our Large-Cap Global Top Stock Ideas and “Neutral” in our US Industrials Global Top Stock Ideas. 
  • Straumann Holding AG (SWX: STMN) announced CY4Q2018 financials containing its strongest earnings growth since 2005. Straumann reported organic y/y earnings growth of 21.6% while consensus was for 16.8%. Daniel Buchta, an analyst with Vontobel, wrote in a note to clients that Straumann could produce double-digit organic growth for at least the next 5 years. Straumann is rated “Neutral” in our European Large-Cap Global Top Stock Ideas.
  • Uniti Group Inc. (UNIT) shares tanked the most in its history alongside former parent company Windstream Holdings (WIN) after the latter lost a court battle, prompting Cowen and Raymond James to abandon their buy-equivalent ratings. The court ruling exposes Windstream, who is also Uniti’s largest customer, to potential cuts on its master lease agreements. Uniti is rated “Top Short” in our US Large-Cap Global Top Stock Ideas.   
  • Walmart (WMT) reported fourth quarter adjusted EPS of USD$1.41 beating consensus of USD$1.34.  Walmart reported fourth quarter sales of USD$138.8 billion matching consensus of USD$138.6 billion.  Walmart sales grew 4.2% in the fourth quarter, well above 3.4% expected, with online sales up 43% with Walmart's redesigned website.  Walmart provided 2019 same store sales guidance of 2.5-3%.  Walmart is rated “Attractive” in our Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Staples Global Top Stock Ideas
  • Welbuilt (WBT) reported fourth quarter adjusted EPS of USD$0.18 beating consensus of USD$0.17.  Welbuilt reported fourth quarter revenue of USD$406.1 million missing consensus of USD$393.6 million.  Welbuilt gave 2019 EPS guidance of USD$0.71-0.81.  Welbuilt is rated “Attractive” in our SMID-Cap Global Top Stock Ideas and “Neutral” in our US Industrials Global Top Stock Ideas
  • XPO Logistics Inc. (XPO) shares edged higher after the company announced it will sell USD$1bn of bonds to refinance its debt. According to an official release, XPO Logistics will use the funds to repay borrowings under its pre-existing credit agreement. Last week, XPO Logistics cut its profit forecast for the second time in 2019. XPO Logistics is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Industrials Global Top Stock Ideas.  

 

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US Treasuries

  • US 2-Year Treasury Notes are higher with yields down -2.49 basis points to 2.48%
  • US 5-Year Treasury Bonds are higher with yields down -3.38 basis points to 2.45%
  • US 10-Year Treasury Bonds are higher with yields down -2.69 basis points to 2.63%
  • The US Treasury 2s-5s Spread has narrowed 0.89 basis points to -0.03%
  • The US Treasury 2s-10s Spread has narrowed 0.2 basis points to 0.15%
  • US Treasury 5s-10s Spread has widened 0.69 basis points to 0.18%

Currencies

  • EUR€ is up 0.256% against the USD$ in after hours to 1.134
  • GBP£ is up 1.068% against the USD$ in after hours to 1.3062
  • CHF is up 0.331% against the USD$ in after hours to 0.9989
  • JPY¥ is little changed 0.027% against the USD$ in after hours to 110.59

Commodities

  • WTI Crude is up 0.9% to USD$56.09/bbl with the Brent-WTI spread down USD$-0.99 to USD$9.84/bbl
  • Gold is up 1.06% to USD$1340.96/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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Get Unbiased Quantitative Investment Research from Advanced AI Machine Learning Technology and Maximize your ReturnsGet Unbiased Quantitative Investment Research from Advanced AI Machine Learning Technology and Maximize your Returns

S&P 500 Movers

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Outperformers Sector Price 1D % Chg Volume
PG&E Corp Utilities 6.95 14.60%            3,659,381
Freeport-McMoRan Inc Materials 11.6 6.60%            9,676,699
Noble Energy Inc Energy 22.7 4.68%            3,307,068
Newmont Mining Corp Materials 31 3.88%            2,241,601
Jacobs Engineering Group Inc Industrials 59.9 3.68%                570,143
 
Underformers Sector Price 1D % Chg Volume
Allegion PLC Industrials 81.7 -3.87%                409,300
Electronic Arts Inc Communication Services 89.5 -3.63%            3,232,884
International Flavors & Fragrances Inc Materials 133 -2.95%                493,544
Alaska Air Group Inc Industrials 64.3 -2.65%                470,088
Conagra Brands Inc Consumer Staples 21.1 -2.00%                689,127
Morning BriefA quick GLOBAL RECAP TO START YOUR DAY
Morning BriefA quick GLOBAL RECAP TO START YOUR DAY