morning-quant-ride

Morning Brief

Wake up to the Morning Quant Ride, your global markets update every morning!

Global stocks advancing after the US, Mexico, and Canada agree to a new trilateral trade agreement

Oct 01, 2018

Start Your Free Trial Today

 

 

Our Global Top Picks Rankings are being reset today for the month of October. Look for our updated Top Buys and Top Shorts later this morning.

US Stocks

  • Global stocks are advancing to start the month following news that the US, Canada and Mexico have agreed to changes to NAFTA and will preserve the three-way trading bloc -- the new trading agreement will be called the USMCA (United States Mexico Canada Agreement) 
  • US stocks index futures are pointing to a positive open in NY with the Dow Jones minis +0.79% S&P500 minis +0.63% and Nasdaq 100 minis +0.74% 
  • 3Q earnings kicks off this week with Pepsico (PEP) on October 2, Constellation Brands (STZ) on October 4 and Costco Wholesale Corp (COST) on October 4 – S&P500 earnings is expected to grow 21.5% Y/Y in the quarter 
  •  According to Bloomberg, US-listed emerging markets ETFs saw inflows of USD$962.2mm last week – this follow a week of inflows the week before of USD$477mm
  • The VIX is little changed this morning and is currently at 11.81 after closing at 12.12 yesterday
  • General Electric (GE) November 09 OTM Puts, FXI October 19 OTM Calls, Sirius XM Holdings (SIRI) January 2019 OTM Calls & Puts, and Petrobras (ADR: PBR) October 19 OTM Calls are the most heavily traded options contracts in the US pre-market 
  • US 10-Year Treasury Bonds are lower with yields up 2.43 basis points to 3.0855%
  • The US Treasury 2s-10s Spread has widened 1.2 basis points to 0.25%
  • WTI Crude is currently up 1.57% to USD$73.25/bbl with the Brent-WTI spread down USD$-1.37 to USD$9.87/bbl
  • Gold is currently down -0.35% to USD$1186.74/oz
  • Global oil prices look set to continue last quarter’s rally following news that the number of working oil rigs in the US dropped for a second week in a row – global oil prices gains last quarter was the biggest positive move in a decade

Stocks Trending in the News

Click name for Q-Factor score and financial data.

  • Facebook (FB) said as many as 50 million of its customers’ accounts were potentially hacked.  The hackers took advantage of multiple weaknesses in its code at the same time to steal the digital tokens that are used when a person logs in.  With these tokens Facebook customer accounts could be logged into by hackers.  Facebook is indicated 1% lower in pre-market trading.  Facebook is rated ‘Neutral’ in our US Large-Cap Global Top Picks and ‘Attractive’ in our US Information Technology Global Top Picks
  • General Electric (GE) will take a non-cash impairment charge of close to USD$23bn, its present goodwill balance, due to shortfalls in its GE Power business.  GE also announced it will replace its CEO, John Flannery, effective immediately. GE is rated ‘Top Short’ in our US Large-Cap Global Top and ‘Unattractive’ in our US Industrials Global Top Picks.
  • Intel (INTC) was downgraded to underweight at Barclay’s from equal weight.  Intel’s price target was dropped to $38 from $53, implying ~20% downside from Friday’s close.  The note cited Intel’s well known production problems in its downgrade.  Intel is rated ‘Neutral’ in our US Large-Cap Global Top Picks and ‘Top Buy’ in our US Information Technology Global Top Picks
  • Nintendo’s (7974 JP) new smartphone game Dragalia Lost is seeing more success in Asia than the US according to researcher Sensor Tower.  In Japan it’s the 11th highest-grossing app, in Hong Kong its third and in Taiwan it’s eighth.  Nintendo closed 1.4% higher at 42,040 yen.  Nintendo is not rated in our Global Top Picks
  • Pfizer (PFE) announced its CEO is stepping down at the end of the year.  Ian Read is vacating the post of CEO after 8 years at the helm.  He will remain as executive chairman of Pfizer.  Pfizer is rated ‘Attractive’ in our US Large-Cap Global Top Picks.
  • Ryanair (RYA ID) lowered its profit outlook given its labor woes in a number of countries.  Ryanair also highlighted rising fuel costs as further reason for the lower guidance.  Ryanair is down 8.8% at 11.96 euros.    Ryanair is rated ‘Top Short’ in our European Large-Cap Global Top Picks
  • Sony (6758 JP) announced an 11% price cut to its PlayStation 4 game console in Japan in an email.  Sony cut the price to 39,980 yen from 44,980 and is effective October 12.  Sony did not give any information on pricing outside of Japan.  Sony closed down 1.25% at 6879 yen.  Sony is rated ‘Neutral’ in our Japan Large-Cap Global Top Picks
  • Tesco Bank (TSCO LN) agreed to pay 16.4mm pounds in a settlement with the UK’s Financial Conduct Authority.  The settlement covers funds stolen from customer accounts when the firm’s network was hacked.  Tesco is trading 0.83% lower at 237.80 pence.  Tesco is rated ‘Attractive’ in our United Kingdom All-Cap Global Top Picks
  • Tesla (TSLA) CEO Elon Musk reached a settlement with the SEC regarding its allegations that he sent misleading tweets about taking Tesla private.  He will pay a US$20mm fine and will be barred from the chairmanship role for 3 years.  He will be permitted to remain as the company’s CEO.  Tesla is rated ‘Unattractive’ in both our US Large-Cap and US Information Technology Global Top Picks
  • Thyssenkrupp (TKA G) announced it is splitting into two units, Thyssenkrupp Industrials with the elevator, automotive and plant construction units and Thyssenkrupp Materials that will contain the steel and metals-focused units.  The breakup comes in the wake of activist shareholders demands and amid losses in its industrial unit.  Thyssenkrupp is up 0.60% at 21.83 euros.  Thyssenkrupp is rated ‘Top Short’ in our European Large-Cap Global Top Picks
  • Yes Bank (YES IN) has its credit rating put on watch by CARE ratings.  CARE said its debt is under “credit watch with developing implications” as questions remain about Yes Bank’s CEO succession plans.  Yes Bank closed 9.4% higher at 200.85 rupees.  Yes Bank is rated ‘Attractive’ in our India All-Cap Global top Picks

European Stocks

  • European stocks are advancing this morning, in sympathy with US index futures as news about the USMCA is boosting investor sentiment 
  • The Euro Stoxx 600 is currently up +0.29%, the FTSE 100 is higher by +0.07%, the DAX has advanced +0.54%, and the CAC 40 has risen +0.25%
  • Citigroup downgrades its outlook for Italian banks to “Neutral” from “Overweight” over concerns about political uncertainty 
  • Europe-focused stocks strategists are seeing “value” in Italian stocks with the potential for an acceleration in GDP growth offsetting worries about 2.4% budget deficit next year
  • Investor sentiment for European stocks is positive with the advance/decline ratio for the Euro Stoxx 600 currently at 2.3x
  • Chemicals (+1.17%), Media (+0.83%), and Oil & Gas (+0.8%) stocks are the top performers in the Euro Stoxx 600 today
  • Travel & Leisure (-0.46%), Health Care (-0.04%), and Retail (-0.02%) stocks are the worst performers in the Euro Stoxx 600 today
  • 62 stocks in the Euro Stoxx 600 are at 4-week highs while 71 stocks are at 4-week lows
  • 24 stocks in the Euro Stoxx 600 are overbought while 34 stocks are oversold according to the 16-day RSI Measure
  • VSTOXX, the European stocks equivalent of the VIX, is little changed this morning and is currently at 14.27 after closing at 14.76 yesterday
  • EUR€ is currently little changed against the USD$ at 1.1607
  • GBP£ is currently little changed against the USD$ at 1.304
  • CHF is currently down -0.167% against the USD$ to 1.0169
  • German 10-Year Bunds are lower with yields up 2.7 basis points to 0.497%
  • UK 10-Year GILTs are lower with yields up 2.1 basis points to 1.594%

Asian Stocks

  • Asian stocks started the month mixed, with a positive move in the Japanese stocks offset by losses across other stock markets 
  • Chinese and Hong Kong Stocks were closed for the National Day holiday 
  • Japanese stocks continue to be buoyed by a weakening Yen which supports export-sensitive stocks in the Nikkei 225 (and Topix) -- the Nikkei 225 is nearing a 27-year high though trading throughout the day was on very light volume
  • The Nikkei 225 finished up +0.52%, the Hang Seng ended up +0.26% and the CSI 300 was +1.04%
  • Investor sentiment for Japanese stocks finished neutral with the advance/decline ratio for the Nikkei 225 closing at 1.08x
  • 83 stocks in the Nikkei 225 hit 4-week highs while 5 stocks reached 4-week lows
  • 63 stocks in the Nikkei 225 closed overbought while 0 stocks closed oversold according to the 16-day RSI Measure
  • Japan 10-Year Government Bonds are lower with yields up 0.6 basis points to 0.136%
  • JGBs 2s-10s Spread has widened 0.6 basis points to 0.25%
  • JPY¥ is currently up +0.246% against the USD$ to 113.98
  • The Yen is at its lowest level in 11 months, weakening for a third consecutive day

*Data in Price Return and Updated Real-Time (with a delay), Source: StockDio

Stock Sentiment

Top Stocks by 7-day News Volume

On Mobile/Tablet scroll to the right.

Name 7 Day News
Volume
7 Day Average
News Buzz
1M EPS Net
Revisions
3M EPS Net
Revisions
1M EPS
% Chg
3M EPS
% Chg
Alphabet Inc 1816 8.14 0 4 2.65% 0.12%
Ford Motor Co 1075 8.43 -1 -18 -0.37% -10.3%
Microsoft Corp 850 6.86 3 29 0.19% 7.15%
Netflix Inc 836 6.29 -4 -18 0.1% 0.86%
Comcast Corp 814 3.43 2 11 0.35% 4.89%

Note: Please see our General FAQs to learn how we define and measure News Volume

Top Stocks by 7-Day Average News Buzz

On Mobile/Tablet scroll to the right.

Name 7 Day News
Volume
7 Day Average
News Buzz
1M EPS Net
Revisions
3M EPS Net
Revisions
1M EPS
% Chg
3M EPS
% Chg
PepsiCo Inc 147 9.57 0 6 -0.33% 1.87%
Lockheed Martin Corp 188 9.29 -1 13 0.0% 10.42%
Visa Inc 254 9.14 0 25 0.01% 5.22%
Costco Wholesale Corp 57 9 7 11 0.11% 0.48%
General Motors Co 222 8.86 -2 -19 -0.22% -9.02%

Note: Please see our General FAQs to learn how we define and measure News Buzz

Implied Volatility Data For Liquid Macro Index ETFs

On Mobile/Tablet scroll to the right.

ETF 30D IV 30D IV
Percentile
90D IV 90D IV
Percentile
90D/30D IV 90D/30D IV
Percentile
30D IV-
20D HV
30D IV-20D HV
Percentile
90D IV-
60D HV
90D IV-60D HV
Percentile
SPY 8.67 34.52% 11.47 57.34% 1.32 92.26% 3.01 83.73% 4.38 91.67%
QQQ 13.45 38.1% 15.76 54.37% 1.17 86.11% 2.3 61.51% 3.83 85.12%
IWM 11.88 24.8% 12.69 10.52% 1.07 47.62% 3.89 80.56% 3 60.71%
FEZ 14.85 71.83% 14.74 69.05% 0.99 22.22% 0.51 48.02% 0.14 45.63%
EEM 17.36 59.92% 18.79 71.03% 1.08 68.45% 2.82 78.17% 0.56 46.63%

Note: Please see our Options FAQs to learn more about Implied Volatility and other advanced options volatility measures

S&P 500 Sector Performance

Note: Data as of 9/28/2018
*Data in Price Return as of Previous Day's EOD, Source: StockDio

Russell 1000 Factor Performance

Note: Data as of 9/28/2018
*Data in Price Return as of Previous Day's EOD, Source: StockDio

Stock Movers From Our US Large-Cap Model

Top Buy Winners and Losers

On Mobile/Tablet scroll to the right

Winners Ticker Sector Industry 1D Return 5D Return YTD
PUBLIC SERVICE ENTRP GRP INC PEG Utilities Multi-Utilities 2.79% 1.24% 6.13%
MCCORMICK & CO INC MKC Consumer Staples Food Products 2.66% 1.17% 27.28%
PPL CORP PPL Utilities Electric Utilities 1.79% -1.43% -0.07%
OGE ENERGY CORP OGE Utilities Electric Utilities 1.78% -1.01% 13.61%
SUN COMMUNITIES INC SUI Real Estate Equity Real Estate Investment Trusts (REITs) 1.7% 0.07% 12.4%
 
Losers Ticker Sector Industry 1D Return 5D Return YTD
S&P GLOBAL INC SPGI Financials Capital Markets -4.33% -7.9% 15.78%
VAIL RESORTS INC MTN Consumer Discretionary Hotels, Restaurants & Leisure -4.18% -2.81% 27.72%
MOODY'S CORP MCO Financials Capital Markets -3.68% -4.32% 14.24%
MARTIN MARIETTA MATERIALS MLM Materials Construction Materials -2.8% -5.47% -20.58%
VULCAN MATERIALS CO VMC Materials Construction Materials -1.63% -3.84% -16.36%

Source: S&P Capital IQ, StockDio

Top Short Winners and Losers

On Mobile/Tablet scroll to the right

Winners Ticker Sector Industry 1D Return 5D Return YTD
ACADIA PHARMACEUTICALS INC ACAD Health Care Biotechnology -4.93% 2.88% -38.24%
PENNEY (J C) CO JCP Consumer Discretionary Multiline Retail -4.13% -19.63% -74.59%
SNAP INC SNAP Information Technology Software -3.7% -7.49% -56.7%
FITBIT INC FIT Information Technology Electronic Equipment, Instruments & Components -3.67% -10.46% -11.63%
FOSSIL GROUP INC FOSL Consumer Discretionary Textiles, Apparel & Luxury Goods -3.63% 1.56% 99.0%
 
Losers Ticker Sector Industry 1D Return 5D Return YTD
FOCUS FINANCL PRTNR LLC-REDH FOCS Financials Capital Markets 3.76% -0.4% 23.42%
ARRAY BIOPHARMA INC ARRY Health Care Biotechnology 2.94% -0.66% 11.49%
EXACT SCIENCES CORP EXAS Health Care Biotechnology 2.87% 3.4% 42.12%
QORVO INC QRVO Information Technology Semiconductors & Semiconductor Equipment 2.86% -2.23% 11.0%
VISTRA ENERGY CORP VST Utilities Independent Power and Renewable Electricity Producers 2.85% 4.27% 30.06%

Source: S&P Capital IQ, StockDio

Cryptos

  • StellarX, the Stellar-based zero-fee decentralized crypto exchange, has left its beta stage and is fully launched as of Friday, September 28th. StellarX is a crypto exchange that utilizes Stellar’s open-source protocol to enable cryptocurrency-to-fiat transfers while offering pairings for the US Dollar, Euro, Chinese Yuan, Hong Kong Dollar, British Pound, and others. In its announcement Friday, StellarX also revealed plans to offer digitized versions of other assets, including stocks, real estate, bonds, and commodities. 
  • The London Block Exchange announced plans to release a new stablecoin pegged to the British Pound Sterling. Dubbed LBXPeg, the stablecoin will be backed one-to-one by the British Pound Sterling by reserves of the fiat currency. The London Block Exchange calls themselves the “only London-based cryptocurrency exchange offering safeguarded UK Banking”, while offering over-the-counter trading services alongside their “College of Crypto” that teaches individuals about the cryptocurrency industry. 
  • After the Economic Times released an article citing two anonymous sources that claimed the Reserve Bank of India (RBI) had created a blockchain unit, the RBI has denied the “formal creation” of any unit to research AI and blockchain technology. To investigate the Economic Times’ claims, Naimish Sanghvi, founder of Coin Crunch India, submitted a formal Right to Information (RTI) request to the RBI regarding the creation of a Blockchain unit. The RBI clarified in a response to the RTI that, while the RBI has formed a unit to “study and provide guidance on the desirability and feasibility to introduce a central bank digital currency”, there has been no unit formed to research AI and blockchain technology in India.   
  • Popular web browser, Opera, announced in a press release that it is partnering with blockchain advisory and financial services firm, Leger Capital, to pursue potential applications in blockchain technology. The partnership will see the two firms specifically search for application and use cases for blockchain technology while identifying growth opportunities blockchain technology can offer. Opera is also currently developing a cryptocurrency wallet to be built into its Android browser.

Cryptocurrencies Today

*Data in Price Return and Updated Real-Time (with a delay), Source: StockDio

Events Calendar

On Mobile/Tablet scroll to the right

 

Source: S&P Capital IQ