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Global stocks are dropping as US treasury yields are at the highest level since 2011

Oct 04, 2018

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US Stocks

  • Global stocks are dropping this morning as US treasury yields continue to rally after the yield on the US 10-year hit the highest level since 2011 in yesterday’s trading 
  • US Federal Reserve Chairman Jerome Powell, during a presentation yesterday, suggested current US interest levels are nowhere near “neutral” -- this side comment is what helped fuel the sell-off in US treasuries 
  • Bloomberg is reporting that Chinese spies were able to successfully hack 30 major US companies, including Amazon (AMZN) and Apple (AAPL), by placing tiny chips on server motherboards produced by Super Micro Computer (SCMI) in China 
  • US stocks index futures are pointing to a positive open in NY with the Dow Jones minis +0.21% S&P500 minis +0.26% and Nasdaq 100 minis +0.27% 
  • The VIX is little changed this morning and is currently at 11.78 after closing at 11.61 yesterday
  • EEM November 16 OTM Calls, SPY October 5 OTM Calls & Puts, Bank of America (BAC) October 5 OTM Calls and Apple (AAPL) October 5 OTM Calls are the most heavily traded options contracts in the US pre-market 
  • US 10-Year Treasury Bonds are lower with yields up 2.84 basis points to 3.2097%
  • The US Treasury 2s-10s Spread has widened 1.61 basis points to 0.33%
  • WTI Crude is currently up 1.57% to USD$76.41/bbl with the Brent-WTI spread down USD$-1.44 to USD$9.79/bbl
  • Gold is currently little changed 0.12% to USD$1198.84/oz
  • Global oil prices are 4-year highs with WTI now up more than 4% this week alone 

Stocks Trending in the News

Click name for Q-Factor score and financial data.

  • Bang & Olufsen (BO DC) shares are falling 3.4% at 140.60 krona after reporting 5mm krona for 1Q ebit, below expectations.  Bang & Olufsen maintained full year guidance of 10% revenue growth at ebit margin 7-9% for full year.  Bang & Olufsen is rated ‘Neutral’ in our European SMID-Cap Global Top Picks 
  • Bilibili (BILI) closed 8% higher at $14.37 yesterday after Tencent (700 HK) said it would invest USD$ 300mm in the company.  Tencent will hold roughly 12.3% of Bilibili after the transaction is complete.  Bilibili came public in March and subsequently rose 70% since then.  Tencent closed 2.4% lower in Hong Kong at HKD$308.40
  • CNOOC (883 HK) was downgraded at UBS to neutral from buy although the price target of HKD$16.60 was maintained.  CNOOC has risen 38% year-to-date and UBS sees the stock as fairly valued after the rise given the 27% increase in Brent crude this year.  CNOOC closed 3.5% lower at HKD$1504.  CNOOC is rated “Top Buy’ in our China All-Cap Global Top Picks.
  • Danske Bank (DANSKE SS) reported that the US Justice Department has launched a money laundering investigation into its Estonian unit.  The investigation joins those happening in Estonia and Denmark into Danske Bank’s movement of cash through Estonia.  Danske is trading 3% lower at 161.20 krona.  Danske Bank is rated ‘Top Short’ in our European Large-Cap Global Top Picks 
  • Eli Lilly (LLY) said results from an experimental diabetes drug included a 12.7% loss of weight for patients.  With that, Eli Lilly will conduct a “very broad” trial to investigate its use for other ailments, including obesity.  Eli Lilly is rated ‘Neutral’ in our US Large-Cap Global Top Picks.
  • Google (GOOGL) may be investigated by the US Department of Justice according to a report in the NY Post today.  The article states Makan Delrahim, the DOJ antitrust chief, told senators Wednesday that he may investigate Google and its Android operating system though there has been no official word from the government.  Google (Alphabet) is rated ‘Neutral’ in both our US Large-Cap and US Information Technology Global Top Picks
  • Kering (KER FP) shares are falling 5% at 439.70 euros after social media reports speculating that China may increase scrutiny of what its citizens are bringing into China.  China is crucial for luxury goods sellers as its millennials are key buyers of goods from Kering and other luxury goods sellers.  Kering is rated ‘Attractive’ in our European Large-Cap Global Top Picks
  • Nintendo (7974 JP) will release a new Switch console in the second half of 2019, according to a report in the Wall Street Journal.  Daiwa upgraded Nintendo to a buy from hold with a price target hike to 55,200 yen from 46,200.  Despite the news, Nintendo closed 1.3% lower at 40,790 yen.  Nintendo is not rated in our Global Top Picks 
  • Swedbank (SWEDA SS) shares are falling 2.5% at 201 krona despite comments from the Swedish FSA downplaying the chance for money laundering in its Estonian operations.  This comes after a Bloomberg story yesterday highlighting the large flow of funds through Estonia that the regulator seemed to downplay.  Swedbank is rated ‘Attractive’ in our European Large-Cap Global Top Picks

European Stocks

  • European stocks are declining this morning, as investors continue to assess US Fed Chairman’s Powell’s comments and the impact of higher US Treasury yields on asset allocation 
  • The Euro Stoxx 600 is currently down -0.84%, the FTSE 100 has declined -1.06%, the DAX has fallen -0.31%, and the CAC 40 is lower by -1.08%
  • Investor sentiment for European stocks is negative with the advance/decline ratio for the Euro Stoxx 600 currently at 0.27x
  • Insurance (+0.94%), Banks (+0.44%), and Oil & Gas (-0.06%) stocks are the top performers in the Euro Stoxx 600 today
  • Personal & Household Goods (-2.57%), Real Estate (-2.16%), and Utilities (-1.75%) stocks are the worst performers in the Euro Stoxx 600 today
  • 62 stocks in the Euro Stoxx 600 are at 4-week highs while 51 stocks are at 4-week lows
  • 25 stocks in the Euro Stoxx 600 are overbought while 23 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 14.23 after closing at 14.61 yesterday
  • EUR€ is currently up +0.157% against the USD$ to 1.1496
  • GBP£ is currently up +0.332% against the USD$ to 1.2983
  • CHF is currently little changed against the USD$ at 1.0085
  • German 10-Year Bunds are lower with yields up 5.7 basis points to 0.532%
  • UK 10-Year GILTs are lower with yields up 7.9 basis points to 1.654%

Asian Stocks

  • Asian stocks closed in the red overnight following the jump in US treasury yields in yesterday’s trading 
  • The Nikkei 225 finished down -0.56%, the Hang Seng ended down -1.73%, the Hang Seng China Enterprise declined -2.21%, and the CSI 300 was +1.04%
  • While Chinese stocks are closed for Golden Week, Hong Kong stocks continue to be under pressure as a strengthening USD$ and improving economic outlook in the United States is leading to a flow of funds into US assets at the expense of Hong Kong and Chinese assets 
  • Investor sentiment for Japanese stocks finished neutral with the advance/decline ratio for the Nikkei 225 closing at 1.06x
  • 34 stocks in the Nikkei 225 hit 4-week highs while 2 stocks reached 4-week lows
  • 48 stocks in the Nikkei 225 closed overbought while 1 stock closed oversold according to the 16-day RSI Measure
  • Investor sentiment for Hong Kong stocks finished negative with the advance/decline ratio for the Hang Seng closing at 0.11x
  • 1 stock in the Hang Seng hit 4-week highs while 7 stocks reached 4-week lows
  • 2 stocks in the Hang Seng closed overbought while 2 stocks closed oversold according to the 16-day RSI Measure
  • Japan 10-Year Government Bonds are lower with yields up 1.8 basis points to 0.159%
  • JGBs 2s-10s Spread has widened 1.2 basis points to 0.27%
  • JPY¥ is currently down -0.201% against the USD$ to 114.3

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

Stock Sentiment

Top Stocks by 7-day News Volume

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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 1496 8.29 0 5 0.27% 2.32%
Ford Motor Co 1056 6.71 -2 -18 -0.96% -10.73%
Microsoft Corp 718 7.71 4 30 0.19% 7.15%
Goldman Sachs Group Inc/The 718 8.86 -9 23 -0.89% 6.33%
Netflix Inc 595 6.29 -1 -19 0.1% 0.81%

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

Top Stocks by 7-Day Average News Buzz

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Name 7 Day News
Volume
7 Day Average
News Buzz
1M EPS Net
Revisions
3M EPS Net
Revisions
1M EPS
% Chg
3M EPS
% Chg
Costco Wholesale Corp 61 9.43 7 11 0.23% 0.6%
Goldman Sachs Group Inc/The 718 8.86 -9 23 -0.89% 6.33%
PepsiCo Inc 274 8.57 -5 4 0.71% 3.17%
Lowe's Cos Inc 55 8.57 -7 -29 -0.09% -3.0%
General Motors Co 362 8.43 -1 -20 -1.57% -9.82%

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

Implied Volatility Data For Liquid Macro Index ETFs

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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 8.86 39.88% 11.31 55.16% 1.28 85.71% 3.22 87.7% 4.58 93.65%
QQQ 14.25 49.21% 15.27 44.44% 1.07 48.61% 4.2 80.16% 3.82 84.13%
IWM 13.13 54.96% 13.22 25.2% 1.01 17.46% 3.1 63.49% 3.04 62.1%
FEZ 14.67 68.25% 14.83 68.65% 1.01 28.97% 1.8 59.33% 0.22 46.43%
EEM 18.62 74.6% 19.36 78.17% 1.04 47.22% 5.88 98.02% 1.51 58.73%

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

S&P 500 Sector Performance

*Data in Price Return as of Previous Day's EOD, Source: StockDio

Russell 1000 Factor Performance

*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

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Winners Ticker Sector Industry 1D Return 5D Return YTD
INVESTORS BANCORP INC ISBC Financials Banks 3.2% 0.97% -8.96%
STERLING BANCORP STL Financials Banks 3.09% 1.03% -7.74%
COPART INC CPRT Industrials Commercial Services & Supplies 2.94% 2.13% 19.07%
ZIONS BANCORPORATION ZION Financials Banks 2.69% -0.35% 1.51%
COMMERCE BANCSHARES INC CBSH Financials Banks 2.55% -0.04% 18.62%
 
Losers Ticker Sector Industry 1D Return 5D Return YTD
LIGAND PHARMACEUTICAL INC LGND Health Care Biotechnology -3.39% -3.76% 62.57%
SHERWIN-WILLIAMS CO SHW Materials Chemicals -2.63% -3.53% 7.3%
KELLOGG CO K Consumer Staples Food Products -2.52% -4.61% 3.44%
ABBOTT LABORATORIES ABT Health Care Health Care Equipment & Supplies -2.43% -1.1% 21.71%
DOLLAR GENERAL CORP DG Consumer Discretionary Multiline Retail -2.4% -4.29% 11.8%

Source: S&P Capital IQ, StockDio

Top Short Winners and Losers

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Winners Ticker Sector Industry 1D Return 5D Return YTD
ALLAKOS INC ALLK Health Care Biotechnology -9.32% -18.28% 20.84%
HEALTHCARE REALTY TRUST INC HR Real Estate Equity Real Estate Investment Trusts (REITs) -2.49% -2.88% -11.25%
MACERICH CO MAC Real Estate Equity Real Estate Investment Trusts (REITs) -2.2% -2.97% -18.93%
FIRST SOLAR INC FSLR Information Technology Semiconductors & Semiconductor Equipment -1.91% -0.52% -37.72%
AMBARELLA INC AMBA Information Technology Semiconductors & Semiconductor Equipment -1.88% -1.88% -51.29%
 
Losers Ticker Sector Industry 1D Return 5D Return YTD
LAREDO PETROLEUM INC LPI Energy Oil, Gas & Consumable Fuels 6.31% -7.6% -34.46%
GULFPORT ENERGY CORP GPOR Energy Oil, Gas & Consumable Fuels 6.3% 9.65% -15.99%
ARRAY BIOPHARMA INC ARRY Health Care Biotechnology 5.99% 4.91% 14.41%
PORTOLA PHARMACEUTICALS INC PTLA Health Care Biotechnology 5.2% -6.31% -64.9%
PBF ENERGY INC PBF Energy Oil, Gas & Consumable Fuels 4.95% 5.36% 41.09%

Source: S&P Capital IQ, StockDio

Cryptos

  • A report released by technology research company, ReportLinker, projects blockchain technology in the US manufacturing sector to maintain an 80% per annum growth rate and to be worth USD$566 million by 2025. The report details that the manufacturing sector stands to benefit from blockchain technology as it will simplify business processes, maintain transparency, and eliminate intermediaries in logistics and supply chains. The report also cites several growth drivers for blockchain in the manufacturing sector, including the growth of blockchain-as-a-service solutions and recent increases of venture capital investment in blockchain.  
  • Acing, a cryptocurrency startup working specifically on the lightning network, has received USD$1.7 million in a funding round led by Serena Capital. Acing works on improving the lightning network, a network layer that sits on top of cryptocurrencies like Bitcoin (BTC) and enables higher transaction volume capabilities. The lightning network entered beta testing earlier this year with individuals using it to send real money, however, the technology is far from complete. Currently, 113.12 BTC are tied up in the lightning network, or USD$741,818.86.  
  • Head of the International Monetary Fund (IMF), Christine Lagarde, believes global markets are on the verge of another financial crash. Lagarde detailed that global debt in both the public and private sectors have reached an all-time high of USD$182 trillion -- a 60% increase since the Great Recession in 2008. While speaking at the IMF’s annual meeting, Lagarde said, “large challenges loom for the global economy to prevent a second Great Depression.” Lagarde went on to detail that rapid technologic advances in financial technology pose increased cybersecurity risks, leaving global markets further vulnerable.  
  • The price of Tether (USDT), the most widely used stablecoin, fell by ~1% yesterday and resulted in a premium on USDT-to-cryptocurrency trades. Tether is the cryptocurrency market’s largest stablecoin and is backed by USD$2.8 billion stored in a Tether LLC bank account in Puerto Rico. One reason for USDT’s price drop yesterday is a large selloff of USDT by investors, potentially to invest in other cryptocurrencies like Bitcoin or Ethereum.  

Cryptocurrencies Today

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

Events Calendar

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Company Name Ticker Event Date Event Type Q-Factor Score
SYNNEX Corporation SNX 10/2/2018 Earnings Release Date US Large-Cap: C, US Information Technology: A
RPM International Inc. RPM 10/3/2018 Earnings Release Date US Large-Cap: D
Lennar Corporation LEN 10/3/2018 Earnings Release Date US Large-Cap: C, US Consumer Discretionary: D
Constellation Brands, Inc. STZ 10/3/2018 Earnings Release Date US Large-Cap: C, US Consumer Staples: B
Costco Wholesale Corporation COST 10/4/2018 Earnings Release Date US Large-Cap: B, US Consumer Staples: B
Texhong Textile Group Limited SEHK:2678 10/7/2018 Estimated Earnings Release Date China All-Cap: C
SUPERVALU INC. SVU 10/8/2018 Estimated Earnings Release Date US Large-Cap: D, US Consumer Staples: C
Fastenal Company FAST 10/9/2018 Estimated Earnings Release Date US Large-Cap: A, US Industrials: C
Walgreens Boots Alliance, Inc. WBA 10/11/2018 Earnings Release Date US Large-Cap: B, US Consumer Staples: B
Delta Air Lines, Inc. DAL 10/11/2018 Estimated Earnings Release Date US Large-Cap: C, US Industrials: C
Domino's Pizza, Inc. DPZ 10/11/2018 Estimated Earnings Release Date US Large-Cap: B, US Consumer Discretionary: A
Marriott Vacations Worldwide Corporation VAC 10/11/2018 Estimated Earnings Release Date US Large-Cap: B, US Consumer Discretionary: C
JPMorgan Chase & Co. JPM 10/12/2018 Earnings Release Date US Large-Cap: C
Citigroup Inc. C 10/12/2018 Earnings Release Date US Large-Cap: C
Wells Fargo & Company WFC 10/12/2018 Earnings Release Date US Large-Cap: C
The PNC Financial Services Group, Inc. PNC 10/12/2018 Earnings Release Date US Large-Cap: B
First Republic Bank FRC 10/12/2018 Earnings Release Date US Large-Cap: B

Source: S&P Capital IQ