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Tick, Tock! As the clock counts down to midnight tariff deadline, US stocks post further losses

May 09, 2019

 

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US Markets End of Day Snapshot

  • US stocks close lower again as the clock ticks down to the midnight tariff deadline; a midday rally limited losses and markets close off lows of the seesion
  • The S&P 500 finished down 0.3%, Nasdaq Composite is down 0.41%, and Russell 2000 is down 0.31%
  • Both President Trump and President Xi started the day with a hardened position but news of the letter from Xi means there may be a chance for a deal still this week - Vice Premier Liu and his delegation are already in Washington
  • There is a 5pm meeting today between US and Chinese officials to discuss trade
  • More on US-China: Trump Launched Tweet Barrage at China after they Changed Their Tune on Agreed-to Trade Deal
  • The most recent bond auction saw demand for US 10-year Treasuries come at the lowest level in over a decade, at 2.17 times the amount offered, fueling fears of those like JP Morgan (JPM) CEO Jamie Dimon, who warn of higher rates coming sooner than most think
  • Read more on 10-year rates: Harbinger of Higher Yields? 10-Year Treasury Auction Demand Lowest in over a Decade
  • Critics of the tariffs that President Trump is threatening to reinstate say they could cut US GDP in half if they return
  • Initial Jobless Claims for the week ending were 228,000, in line with 220,000 consensus and 230,000 a week earlier
  • PPI Final Demand rose 0.2% in April, below consensus of 0.2% and down from 0.3% in March
  • PPI Final Demand ex-food and energy rose 0.1% in April, below consensus of 0.3% and down from 0.6% in March
  • TOP CONSUMER STOCKS for you: Consumer Closeout! TOP BUY CONSUMER STOCKS you need NOW to maximize your portfolio!
  • Check out these TOP CHINA STOCKS: Look East and Feast: Top Chinese Stocks to fill your plate (and portfolio) with NOW! 
  • These are our TOP TECH STOCKS: TOTALLY TOP TECH! These are the BEST US Tech stocks you need in your portfolio NOW!
  • The VIX keeps rising: Run Forrest, Run! Investors Flee Risk Assets This Week as VIX spikes over 60%
  • Real Estate (+0.33%), Energy (+0.07%), and Utilities (-0.09%) stocks were the top performers in the S&P 500 today
  • Consumer Discretionary (-0.43%), Tech (-0.68%), and Materials (-0.8%) 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 0.9x
  • 16 stocks in the S&P 500 hit 4-week highs while 83 stocks reached 4-week lows
  • 16 stocks in the S&P 500 closed overbought while 27 stocks closed oversold according to the 16-day RSI Measure
  • 101 stocks in the Nasdaq Composite hit 4-week highs while 109 stocks reached 4-week lows
  • 216 stocks in the Nasdaq Composite closed overbought while 374 stocks closed oversold according to the 16-day RSI Measure
  • The VIX closed down 0.30 points today to 19.10 after closing at 19.40 yesterday

Stocks Trending in the News

Click name for Q-Factor rating and financials data.

Global Consumer Stocks Trending in the News

  • Amazon (AMZN) is being accused of violating kids’ privacy right with its smart speakers.  A child advocacy group filed a complaint with federal authorities complaining that Amazon records conversations of kids on its Echo Dot Kids devices.  The complaint alleges that Amazon records the conversations and then stores them in the cloud, even after parents delete it.   The complaint states the actions violates federal online privacy rules.  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.
  • American Eagle (AEO) was downgraded by both RBC Capital and Wedbush.  RBC Capital cut American Eagle to neutral from buy while Wedbush cut to sector perform from outperform.  In both cases the downgrade was based on valuation.  American Eagles has had an impressive string of results and at this point trades at 14x forward earnings.  That valuation captures most of the anticipated improvements, both downgrades highlight.  American Eagle is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Discretionary Global Top Stock Ideas.  
  • Booking (BKNG) reported first quarter adjusted EPS that missed consensus and cut full year EPS guidance.  Booking posted first quarter EPS of $11.17, behind $11.32 consensus.  Booking cut second quarter adjusted EPS guidance to $22.25 to $22.60, below consensus of $22.68.  Booking is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Discretionary Global Top Stock Ideas.  
  • Edgewell Personal Care (EPC) shares fell by more than 16% after the company surprised investors with the acquisition of Harry’s, a personal shaving startup. According to Citi analyst Wendy Nicholson, the strong quarterly financial results posted by Edgewell were overshadowed by the unexpected acquisition of Harry’s. “The multiple EPC is paying is unclear,” said Herzog, who added, “but strategically, the deal makes sense as EPC has been playing from behind on e-commerce and the combination immediately increases EPC’s scale and capabilities.” Edgewell Personal Care is rated “Attractive” in our US SMID-Cap Global Top Stock Ideas and “Neutral” in our US Consumer Staples Global Top Stock Ideas.
  • Etsy (ETSY) shares slid by double-digits, the most in 2 years, after the online retailer announced softer-than-expected sales in the first quarter. Etsy generated sales of $170.7 million during the first quarter that fell short of analyst expectations for $169.3 million in revenue. Several analysts are calling the selloff of Etsy overblown. Etsy is rated “Attractive” in our US Large-Cap Global Top Stock Ideas.
  • Magna International (TSX: MG) shares fell the most intraday since January after the Canadian car-parts manufacturer pulled-back its earnings outlook, citing a slowdown in the global automotive industry and higher-than-expected costs in developing automated driving systems. Magna now sees net income in FY2019 between $1.9 billion and $2.1 billion, roughly $200 million lower than previously offered guidance. Magna International is rated “Neutral” in our Canada All-Cap Global Top Stock Ideas.
  • Office Depot (ODP) suffered a 2-notch downgrade from Bank of America Merrill Lynch, cutting it to underperform from buy.  Office Depot’s price target was cut to $2 from $4.  Merrill Lynch has been bullish on the stock and was anticipating a turnaround.  Office Depot disappointed recently with results and this left Merrill doubting if a turnaround will ever come.  Office Depot is rated “Neutral” in our US SMID-Cap Global Top Stock Ideas and “Neutral” in our US Consumer Discretionary Global Top Stock Ideas 
  • Revlon Inc. (REV) shares edged higher after the Chief Financial Officer Victoria Dolan told investors on a conference call that the company is considering refinancing its debt in early 2020 due to FY2019 results. “We’re constantly looking at the markets, talking to our banks to understand what is going to be required and what those rates would look like,” said CFO Dolan. Revlon is rated “Neutral” in our US SMID-Cap Global Top Stock Ideas and “Top Short” in our US Consumer Staples Global Top Stock Ideas.
  • Roku Inc. (ROKU) shares surged to an all-time high after the video streaming platform announced first quarter revenue and a FY2019 outlook that was ahead of analyst expectations. From their December low, Roku shares are up nearly 200%. The first quarter financials prompted a slew of Street analysts to raise their price targets for Roku shares. Roku is rated “Top Short” in our US Large-Cap Global Top Stock Ideas.
  • Tapestry Inc. (TPR) shares soared by double-digits after the company announced profits during the fiscal third quarter that beat analyst estimates, driven by strong performance in its Coach brand. Tapestry observed global same store sales of 1% during the fiscal third quarter at Coach, although the company’s Kate Spade brand observed a comparable sales decline of 3% in the quarter. The strong results suggest that weak financial posted by Tapestry in the prior quarter were a one-off event, according to Bloomberg. Tapestry is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Discretionary Global Top Stock Ideas.
  • Tenneco Inc. (TEN) shares fell by the most intraday in almost a decade after the company hit a triple-whammy with its first quarter earnings release. Tenneco reported quarterly financials that trailed analyst estimates, cut back its FY2019 guidance, and announced a spin-off of its aftermarket auto parts business. Tenneco lost more than a third of its total market value initially on the news. Tenneco is rated “Attractive” in our US SMID-Cap Global Top Stock Ideas and “Neutral” in our US Consumer Discretionary Global Top Stock Ideas.
  • The Stars Group (TSX: TSGI) shares soared by nearly 25% after Twenty-First Century Fox (TFCF.A) announced a $236 million investment in the provider of sports betting services. According to analyst Daria Fomina, “the agreement will likely be taken positively by the market despite the dilution effect of new shares.” Investors see the new deal with Fox as a great way for the Stars Group to rapidly expand its user base. The Stars Group is rated “Neutral” in our Canada All-Cap Global Top Stock Ideas. Fox is not rated in our Global Top Stock Ideas.
  • Tenneco (TEN) reported first quarter earnings that missed consensus by a huge margin.  Tenneco posted a first quarter loss of 53 cents per share while consensus was for earnings of $1.04.  Revenue of $4.84 billion matched consensus.  Tenneco announced the delay of the spinoff of its aftermarket parts business.  Tenneco cut guidance for second quarter revenue to $4.45 billion to $4.55 billion, below $4.65 billion consensus.  Tenneco is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Consumer Discretionary Global Top Stock Ideas.  
  • Walmart (WMT) published a report on the earnings of its employees to rebut criticism that they are underpaid.  The average salary for a Walmart manager is $175,000 per year while full time employees earn on average $25,000 per year or $14.28 per hour.  Walmart has been expanding benefits and hiking pay both to rebut critics and better position itself in the extremely tight labor market that exists right now.  Walmart is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Staples Global Top Stock Ideas.  
  • Wendy’s (WEN) reported first quarter adjusted earnings that beat consensus.  Wendy’s first quarter adjusted EPS of 14 cents beat consensus of 12 cents.  First quarter revenue of $408.6 million beat consensus of $398.9 million.  Wendy’s reported same store sales of 1.3%, a touch below consensus of 1.4%.  Wendy’s is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Consumer Discretionary Global Top Stock Ideas.  
  • Wynn Resorts (WYNN) reported first quarter adjusted EPS that slightly beat and net revenue that slightly trailed consensus.  First quarter net revenue of $1.65 billion trailed $1.67 billion expectation.  Adjusted EPS of $1.61 came ahead of $1.58 consensus.  Wynn said it expects its Encore Boston Harbor project to open mid-2019.  Wynn Resorts is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Discretionary Global Top Stock Ideas.  

Global Information Technology Stocks Trending in the News

  • Alphabet’s (GOOGL) Google is struggling to convert its music customers to paying customers.  Google’s YouTube was revamped about a year ago and its YouTube Music service is a paid subscription that Google is trying to convert its free users to.  More people listen to music on YouTube than any other streaming service.  Users, however, have grown accustomed to its free price and have been resistant to signing up for paid subscriptions.  Alphabet cited this as part of the reason for its $1 billion revenue miss.  Alphabet is rated “Top Buy” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Information Technology Global Top Stock Ideas.
  • Intel (INTC) provided updated guidance to investors that was not well received.  Intel said it expects revenue growth in the low single digits over the next 3 years.  Intel expects EPS to grow in line with revenue during the same period.  Intel expects its PC revenue to be flat or fall while data center revenue will grow in the high single digits.  Intel is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Information Technology Global Top Stock Ideas.
  • Roku (ROKU) share rose strongly after reporting revenue that beat consensus.  Roku first quarter revenue of $206.7 million beat consensus of $189.9 million.  Roku saw $19.06 average revenue per user with 29.1 million active users.  Roku gave 2019 revenue guidance of $1.03 billion to $1.05 billion, above consensus of $1.02 billion.  Roku is rated “Top Short” in our US Large-Cap Global Top Stock Ideas
  • Trade Desk (TTD) shares plunged by double-digits despite the company reported adjusted earnings in the first quarter of $0.49/share that crushed the average analyst adjusted EPS estimate of $0.26. Trade Desk expects revenue in the upcoming quarter of $154 million that is only slightly ahead of consensus of $153.4 million. Trade Desk also upped its FY2019 revenue guidance from at least $637 million to at least $645 million. Trade Desk is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Information Technology Global Top Stock Ideas.
  • Walt Disney (DIS) reported fiscal second quarter adjusted earnings and revenue that beat consensus.  Disney first quarter adjusted EPS of $1.61 beat consensus of $1.58.  Fiscal second quarter revenue of $14.92 billion beat $14.54 billion expectations.  Disney saw media networks operating income grow to $2.19 billion from $1.3 billion q/q.  Disney CEO Robert Iger said he was “very pleased” with fiscal second quarter results.  Walt Disney is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Information Technology Global Top Stock Ideas.

Global Industrials Stocks Trending in the News

  • Boeing (BA) convinced federal regulators that new pilot training for the new 737 Max, when introduced, was kept to a minimum, ex-employees allege.  Boeing convinced regulators the new version of the plane only required Level B training, which is a couple of hours on an iPad, and no time in a simulator.  Boeing wanted to limit the need for Level D training-which include extensive simulator time-so airlines could deploy the plane more quickly.  Boeing engineers convinced the FAA official in charge-someone with limited flight time-that the Level B training was sufficient.  Critics allege this may have contributed to the 737 Max crashed.  Boeing is rated “Top Short” in our US Large-Cap Global Top Stock Ideas and “Unattractive” in our US Consumer Staples Global Top Stock Ideas.  

Global Commodities & Energy Stocks Trending in the News

  • Chevron (CVX) is walking away from its $33 billion bid to acquire Anadarko Petroleum (APC).  Chevron will collect its $1 billion breakup fee after Occidental Petroleum (OXY) beat it in the competition for Anadarko.  Chevron is five times larger than Occidental.  Chevron will use the breakup fee to increase share buyback by 25%.  Anadarko Petroleum is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas.  Occidental Petroleum is rated “Neutral” in our US Large-Cap Global Top Stock Ideas.  Chevron is rated “Neutral” in our US Large-Cap Global Top Stock Ideas.
  • Duke Energy (DUK) reported first quarter results that came in line with consensus.  Duke Energy first quarter EPS of $1.24 matched consensus of $1.24.  Duke reported first quarter operating revenue of $6.16 billion, trailing $6.31 billion consensus.  Duke Energy provided full year EPS guidance of $4.80 to $5.20 while consensus is presently $4.94.  Duke Energy is rated “Attractive” in our US Large-Cap Global Top Stock Ideas
  • Exelon (EXC) confirmed it is moving forward with closing the Three Mile Island nuclear power plant in Pennsylvania.  Exelon is making the move given that a bill to provide subsidies to keep them open has not moved forward in Pennsylvania’s legislature.  Exelon confirmed previously announced plans.  The plant will be closed by September 30th of this year.  Exelon is rated “Neutral” in our US Large-Cap Global Top Stock Ideas

Global Health Care Stocks Trending in the News

  • Becton Dickinson (BDX) reported fiscal second quarter results that came in line while guidance trailed.   Becton Dickinson fiscal second quarter EPS of $2.59 came a touch ahead of $2.58 consensus.  Revenue of $4.20 billion trailed $4.23 billion expectation.  Becton Dickinson cut full year EPS guidance to $11.65 to $11.75, from $12.05 to $12.15;  and below present consensus of $12.07.  Becton Dickinson is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas

Global Financial Stocks Trending in the News

  • Tradeweb (TW) reported first post-IPO results that came a touch above consensus.  Tradeweb reported first quarter adjusted EPS of 23 cents, ahead of 22 cents consensus.  First quarter revenue of $186.8 million was a touch more than $186.0 million consensus.  Tradeweb declared its first quarterly dividend of 8 cents per share.  Tradeweb saw a 34% growth in volume versus a year ago.  Tradeweb is not rated in our Global Top Stock Ideas.

 

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US Treasuries

  • US 2-Year Treasury Notes are higher with yields down -3.25 basis points to 2.2641%
  • US 5-Year Treasury Bonds are higher with yields down -3.34 basis points to 2.2516%
  • US 10-Year Treasury Bonds are higher with yields down -3.23 basis points to 2.4512%
  • The US Treasury 2s-5s Spread has narrowed 0.08 basis points to -0.01%
  • The US Treasury 2s-10s Spread has widened 0.01 basis points to 0.19%
  • US Treasury 5s-10s Spread has widened 0.11 basis points to 0.2%

Currencies

  • EUR€ is up 0.223% against the USD$ in after hours to 1.1217
  • GBP£ is little changed 0.031% against the USD$ in after hours to 1.301
  • CHF is up 0.52% against the USD$ in after hours to 0.9852
  • JPY¥ is down 0.318% against the USD$ in after hours to 109.75

Commodities

  • WTI Crude is down -0.68% to USD$61.7/bbl with the Brent-WTI spread up USD$0.75 to USD$8.95/bbl
  • Gold is little changed 0.24% to USD$1283.94/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
Tapestry Inc Consumer Discretionary 35.9 8.49%            1,569,295
Nektar Therapeutics Health Care 44.5 7.49%                449,122
Perrigo Co PLC Health Care 45.1 6.99%                255,211
Mylan NV Health Care 29.3 3.97%            2,020,282
Chevron Corp Energy 112 3.14%            2,872,933
 
Underformers Sector Price 1D % Chg Volume
Occidental Petroleum Corp Energy 65.5 -6.44%            5,337,598
Intel Corp Information Technology 48.6 -5.32%          16,739,413
CenturyLink Inc Communication Services 16.2 -4.99%            4,699,319
PG&E Corp Utilities 6.95 -4.49%            1,181,804
Marathon Petroleum Corp Energy 64.4 -4.11%                783,452
Morning BriefA quick GLOBAL RECAP TO START YOUR DAY
Morning BriefA quick GLOBAL RECAP TO START YOUR DAY