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You've got a Month: Trump gives China a month to close trade deal, US stocks post gains; VIX falls 16%

May 10, 2019

 

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Better Research, Better Investments.Better Research, Better Investments.

US Markets End of Day Snapshot

  • US stocks post gains after President Trump said China has a month to close a trade deal with the US
  • The S&P 500 finished up 0.37%, Nasdaq Composite up 0.08%, and Russell 2000 up 0.19%
  • President Trump said China has a month to close a deal and if no deal is reached tariffs will rise again
  • China Vice Premier Liu He said after the talks he thought they went "fairly well"
  • China said it will retaliate with its own tariffs but has no stipulated exactly what they will be
  • US CPI in April rose 0.3%, below 0.4% consensus and 0.4% from a month earlier
  • US CPI ex-food and energy rose 0.1%, below 0.2% consensus and matching March 
  • Real hourly earnings grew 1.2% in April, trailing 1.3% consensus
  • Utilities (+1.73%), Materials (+1.27%), and Consumer Staples (+1.17%) stocks were the top performers in the S&P 500 today
  • Energy (+0.08%), Consumer Discretionary (+0.04%), and Healthcare (-0.07%) 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 2.36x
  • 15 stocks in the S&P 500 hit 4-week highs while 171 stocks reached 4-week lows
  • 19 stocks in the S&P 500 closed overbought while 32 stocks closed oversold according to the 16-day RSI Measure
  • 95 stocks in the Nasdaq Composite hit 4-week highs while 127 stocks reached 4-week lows
  • 179 stocks in the Nasdaq Composite closed overbought while 616 stocks closed oversold according to the 16-day RSI Measure
  • The VIX closed down 3.06 points today to 16.04 after closing at 19.10 yesterday
  • Check out these TOP PICKS posts from this week:

Stocks Trending in the News

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Global Consumer Stocks Trending in the News

  • Anheuser-Busch InBev (BUD) formally filed for an IPO for its Hong Kong unit.  Anheuser-Busch is targeting a $70 billion valuation and stated in its filing that it is the largest beer company in Asia Pacific.  The IPO is being targeted for July and the unit is called Budweiser Brewing Company APAC Ltd.  Anheuser-Busch InBev is rated "Neutral" in our European Large-Cap Global Top Stock Ideas
  • Booking Holdings Inc. (BKNG) shares traded notably higher after better-than-expected hotel nights metrics casted away doubt from Street analysts’ outlook regarding company guidance.  Jefferies analyst Brent Thill wrote to clients regarding the earnings, “As growth in the traditional hotel business continues to decelerate we are confident in BKNG’s plan to continue expanding its alternative accommodations business.” Booking Holdings is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Discretionary Global Top Stock Ideas.  
  • JD.com Inc. (JD) shares edged higher after China’s second-largest e-commerce operator announced revenue that topped analyst estimates. JD.com observed revenue of 121.1 billion yuan ($18 billion) during the first quarter that was ahead of consensus for 120 billion yuan. JD.com’s bottom-line income of 1.2 billion yuan also beat out consensus expectations for a loss of 244.7 million yuan. JD.com is rated “Neutral” in our China All-Cap Global Top Stock Ideas.
  • Marriott International (MAR) reported first quarter earnings that beat consensus.  Marriott posted first quarter EPS of $1.41, beating consensus of $1.34.  First quarter revenue of $5.01 billion trailed consensus of $5.13 billion.  Marriott gave EPS guidance for the second quarter of $1.52 to $1.58 while consensus is $1.62.  Full year EPS guidance of $5.97 to $6.19, consensus is $6.09.  Marriott International is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Consumer Discretionary 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.

Global Information Technology Stocks Trending in the News

  • Motorola Solutions (MSI) received a favorable court ruling related to patents.  The US Patent and Trademark Office upheld Motorola’s patents after Hytera Communications (SZSE:002583) challenged their validity with the Patent Office.  The Patent Office rejected all claims submitted by Hytera in its written ruling.  Motorola Solutions 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.  Hytera Communications is not rated in our Global Top Stock Ideas.
  • Symantec (SYMC) CEO Greg Cark unexpectedly quit, sending shares of Symantec tumbling.  No specific reason was given but Symantec has struggled to make its enterprise security business grow, the unit is the majority of Symantec’s revenue.  Starboard Value LP, the activist hedge fund, bought 5% of the company and has stated its intention to shake up management of the company.  Richard Hill will take over as interim CEO.  Symantec also cut revenue guidance for the rest of the year.  Symantec is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Information Technology 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.
  • Viacom (VIAB) reported fiscal second quarter sales that trailed consensus.  Viacom second quarter sales of $2.96 billion trailed $3.05 billion consensus.  Earnings beat with EPS of 95 cents beating 80 cents consensus.  Viacom saw a drop in international revenue that was the main source of its miss.  No update was given on its potential merge with CBS Corp. (CBS).  Viacom is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Information Technology Global Top Stock Ideas.  CBS Corp. is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Information Technology Global Top Stock Ideas.
  • Zillow Group Inc. (ZG) shares rallied after the company reported first quarter financial results that broadly beat analyst expectations. The broadly strong financials from Zillow led at least five Street analysts to hike their price targets for shares. Despite the initial positive reactions, Bloomberg and Barclay’s both warned that the reaction could be overly optimistic. Zillow initially opened 17% higher in Friday trading before retracing gains to about +5% positive intraday. Zillow Group is not rated in our Global Top Stock Ideas.

Global Industrials Stocks Trending in the News

  • Aeroports de Paris (ENXTPA: ADP) shares fell after being downgraded by JPMorgan, Santander, and Goldman Sachs following the delay of the privatization of the airport operator due to a court ruling. Analysts downgraded the stock because they saw the government embarking on a competitive privatization process of Aeroports de Paris, which appears to no longer appears to be the case. Aeroports de Paris is rated “Attractive” in our European SMID-Cap Global Top Stock Ideas.
  • Equifax (EFX) reported first quarter earnings in line with consensus.  Equifax reported first quarter adjusted EPS of $1.20, matching consensus.  Equifax provide adjusted EPS guidance of $1.32 to $1.37 while consensus with $1.50.  Full year adjusted EPS guidance is $5.60 to $5.80.  Equifax is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas and “Unattractive” in our US Industrials Global Top Stock Ideas.
  • ThyssenKrupp (XTRA:TKA) has abandoned its plan to split itself, separating its steel and capital goods businesses.  Since its announcement in September its stock has fallen 45%, reaching a 15-year low.   ThyssenKrupp is considering a listing of its prized asset, its elevator business.  ThyssenKrupp expects to make a final decision about that listing in the coming months.  ThyssenKrupp is rated “Top Short” in our European Large-Cap Global Top Stock Ideas.
  • Uber (UBER) placed its IPO at $45 per share, near the low end of the price range.  The price range was $44 to $50.  The IPO is raising $8.1 billion for Uber and values the company at about $82 billion.  Uber’s IPO makes it the highest valued IPO since Alibaba (BABA) in 2014.  Alibaba is rated “Top Buy” in our China All-Cap Global Top Stock Ideas.  Uber is not yet rated in our 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.

Global Commodities & Power Stocks Trending in the News

  • Buckeye Partners LP (BPL) shares soared by more than 25% after the IFM Global Infrastructure Fund announced the acquisition of the owner and operator of oil pipelines and terminals for $6.5 billion. The acquisition price of Buckeye represents a 27.5% premium on Thursday’s share closing price. Buckeye Partners is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas.

Global Health Care Stocks Trending in the News

  • Care.com (CARE) announced that is it overhauling its business model and adding in-depth background checks for the caregivers who post on its site.  Care.com has 33 million members and will pay a third-party provider to check criminal histories of caregivers as well as verify their key personal data.  The changes come after the WSJ did a report about problems with caregivers on Care.com.  Care.com is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Information Technology Global Top Stock Ideas.

 

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US Treasuries

  • US 2-Year Treasury Notes are lower with yields up 0.81 basis points to 2.26%
  • US 5-Year Treasury Bonds are lower with yields up 2.01 basis points to 2.26%
  • US 10-Year Treasury Bonds are lower with yields up 2.67 basis points to 2.46%
  • The US Treasury 2s-5s Spread has widened 1.2 basis points to 0%
  • The US Treasury 2s-10s Spread has widened 1.86 basis points to 0.2%
  • US Treasury 5s-10s Spread has widened 0.66 basis points to 0.2%

Currencies

  • EUR€ is up 0.205% against the USD$ in after hours to 1.1238
  • GBP£ is little changed 0.054% against the USD$ in after hours to 1.3007
  • CHF is up 0.406% against the USD$ in after hours to 0.9892
  • JPY¥ is up 0.2% against the USD$ in after hours to 109.96

Commodities

  • WTI Crude is little changed -0.06% to USD$61.66/bbl with the Brent-WTI spread up USD$1.33 to USD$9.9/bbl
  • Gold is little changed 0.16% to USD$1286.08/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
News Corp Communication Services 12.4 4.11%                485,541
Linde PLC Materials 157 4.75%                123,358
News Corp Communication Services 12.5 3.17%                113,011
Booking Holdings Inc Consumer Discretionary 1700 5.40%                152,268
Ball Corp Materials 49.3 3.11%                254,561
 
Underformers Sector Price 1D % Chg Volume
Symantec Corp Information Technology 19.7 -12.54%            5,779,680
Wynn Resorts Ltd Consumer Discretionary 108 -4.72%                742,117
Marriott International Inc/MD Consumer Discretionary 110 -2.78%                469,800
Mettler-Toledo International Inc Health Care 582 -1.89%                  17,962
Tapestry Inc Consumer Discretionary 35.9 -3.33%                890,150
Morning BriefA quick GLOBAL RECAP TO START YOUR DAY
Morning BriefA quick GLOBAL RECAP TO START YOUR DAY