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Global stocks surging following “truce” in US-China trade dispute

Dec 03, 2018

 

Market data as of 7am EST

 

US Stocks

  • Global stocks are surging on news that the US and China will attempt to negotiate through their dispute on trade over the next 90 days rather than escalate tensions between the two trading partners 
  • US index futures are jumping this morning, pointing to a positive start to December with front-month Dow Jones minis +0.79%, S&P500 minis +0.82% and Nasdaq 100 minis +0.79% 
  • US President Donald Trump formally proclaims a “truce” in the trade dispute between the US and China following his dinner with Chinese President Xi Jinping during the G20 Summit in Buenos Aires, Argentina 
  • According to an analysis by Bloomberg, the S&P500 has posted an average return of +1.61% in December as far back as 1950
  • The VIX is  moving down this morning and is currently at 16.3 after closing at 18.07 last week
  • General Electic (GE) December 07 & January 2019 PTM Puts, SPY December 07 OTM Calls, QQQ January 2019 OTM Puts and FXI December 07 & December 221 OTM Calls are some of the most heavily traded options in the US pre-market
  • US 10-Year Treasury Bonds are lower with yields up 3.99 basis points to 3.0278%
  • The US Treasury 2s-10s Spread has narrowed 0.48 basis points to 0.2%
  • WTI Crude is currently up 3.96% to USD$52.93/bbl with the Brent-WTI spread up USD1.11 to USD$8.80/bbl
  • Global oil prices are rallying on news that Russia and Saudi Arabia renewed their agreement to work together to manage the global oil market – no production cuts have been announced yet
  • Gold is currently up 0.65% to USD$1228.5/oz

Stocks Trending in the News

Click name for Q-Factor breakdown, latest price details, more financial info and sentiment data.
 

  • Apple (AAPL) will not introduce an iPhone that can use 5G services until 2020 according to a report from Bloomberg today.  Apple will wait until almost a year after the introduction of 5G technology to take advantage of the new, faster technology, the same way it did when 4G was introduced.  Apple did this in the past to avoid the inevitable early problems with the new service, preferring to wait until it is fully introduced.  Apple is rated “Attractive” in our US Large-Cap and US Information Technology Global Top Stock Ideas. 
  • Bayerische Motoren Werke AG (DB: BMW), Daimler AG (XTRA: DAI), Volkswagen AG (XTRA: VOW3), and other global automobile manufacturer shares are trading higher after US President Donald Trump and China agreed to remove tariffs on American-made cars that severely hindered the global automobile manufacturing industry. BMW is rallying the most in three years on the news. BMW is rated “Unattractive” in our European Large-Cap Global Top Stock Ideas. Daimler is rated “Top Short” in our European Large-Cap Global Top Stock Ideas. Volkswagen is rated “Neutral” in our European Large-Cap Global Top Stock Ideas. 
  • Former General Electric (GE) employees are cited in a Wall Street Journal report that alleges General Electric’s insurance business of failing to acknowledge worsening results over recent years, leading to the turmoil surrounding the large conglomerate. The Wall Street Journal additionally reports that federal investigators are questioning these former General Electric employees in relation to a probe of the conglomerate. General Electric is rated “Top Short” in our US Large-Cap Global Top Stock Ideas and “Unattractive” in our US Industrials Global Top Stock Ideas. 
  • GlaxoSmithKline Plc (LSE: GSK) shares are trading lower after announcing the acquisition of Tesaro Inc. (TSRO) for GBP 4bn (USD$5.1bn). The acquisition price, which translates to an offer price of USD$75/share, is a roughly 62% premium on Tesaro’s Friday’s close. The move to acquire Tesaro, whose stock is down 44% YTD, is a move by CEO Emma Walmsley to revitalize the company’s cancer drug pipeline. GlaxoSmithKline Plc is rated “Top Buy” in our United Kingdom All-Cap Global Top Stock Ideas. Tesaro is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas.
  • Lululemon (LULU) is in talks to join a Chinese investor group attempting a takeover of Amer Sports Oyj (AMEAS FH) according to a report in Bloomberg today.  The report states that Lululemon is in talks to take about 20% of the deal, though nothing has been confirmed officially.  Lululemon is rated “top Buy” in our US Large-Cap Global Top Stock Ideas.  Amer Sports Oyj is rated “Attractive” in our European SMID-Cap Global Top Stock Ideas.
  • MGM China (2282 HK) shares were up strong overnight on a report from JP Morgan.  JP Morgan said the November gaming revenue growth was impressive, growing at 8.5% in November.  JP Morgan said most important is that the strong numbers bear estimates that were increased recently, the median consensus was for 4% growth.  MGM China is rated “Neutral” in our China All-Cap Global Top Stock Ideas.
  • Qualcomm (QCOM) said it has ruled out any other bids for NXP Semiconductor (NXPI) after the US and Chinese negotiations appeared to open the way to potentially approve the deal.  Qualcomm, in a note to the market, said it was grateful for the work of both the countries but that it has abandoned the deal and has no plans to revisit it.  It said, “Qualcomm considers the matter closed”.  Qualcomm is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Information Technology Global Top Stock Ideas.  NXP Semiconductors is not rated in our Large-Cap Global Top Stock Ideas.
  • Unilever (UNA NA) agreed to buy GlaxoSmithKline’s (GSK LN) Indian consumer business for US$3.8 billion.  Unilever is looking to expand its presence in the fast growing economy.   Unilever has been looking to expand further in emerging markets, where it already gets two-thirds of its revenue.  Unilever is rated “Top Buy” in our European Large-Cap Global Top Stock Ideas.  GlaxoSmithKline is rated “Top Buy” in our European Large-Cap Global Top Stock Ideas.  
  • Sands China (SEHK: 1928) shares are trading higher by double-digits after Macau casinos announced November revenue that topped analyst estimates. Macau saw gross casino revenues grow 8.5% y/y to 25bn patacas (USD$3.1bn) while analysts expected growth of just 4%. Analysts had already revised estimates upward in weeks leading up to the announcement, adding to the magnitude of the beat. Sands China is rated “Attractive” in our China All-Cap Global Top Stock Ideas.
  • The Walt Disney Company (DIS) will abandon Comcast Corporation’s (CMCSA) FreeWheel advertising platform in favor of Alphabet’s (GOOGL) Google Ad Manager in relation to its video streaming service. The trend towards digitally native advertising solutions is one being seen across the online television advertising space. Of late, Alphabet has signed deals with CBC, A&E Networks, and AMC Networks to use its Google Ad Manager service. Disney is rated “Top Buy” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Consumer Discretionary Global Top Stock Ideas. Comcast is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Discretionary Global Top Stock Ideas. Alphabet is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Information Technology Global Top Stock Ideas.
  • Verizon (VZ) has been downgraded by JP Morgan to neutral from outperform.   Verizon’s price target was reiterated at USD$62.  Verizon has outperformed the SP500 by 13% recently and JP Morgan highlighted this when downgrading the stock.  Verizon is fully valued at this point, in JP Morgan’s opinion. Verizon is rated is rated “Top Buy” in our US Large-Cap Global Top Stock Ideas.
     

 

European Stocks

  • European stocks are advancing this morning in sympathy with Asian stocks
  • The Euro Stoxx 600 is currently up +1.6%, the FTSE 100 is higher by +2.13%, the DAX has advanced +2.4%, and the CAC 40 has risen +1.47%
  • Investor sentiment for European stocks is positive with the advance/decline ratio for the Euro Stoxx 600 currently at 4.61x
  • Oil & Gas (+2.75%), Telecommunications (-0.09%), and Basic Resources (+4.96%) stocks are the top performers in the Euro Stoxx 600 today
  • Automobiles & Parts (+3.88%), Food & Beverage (-0.15%), and Utilities (+0.55%) stocks are the worst performers in the Euro Stoxx 600 today
  • 30 stocks in the Euro Stoxx 600 are at 4-week highs while 74 stocks are at 4-week lows
  • 13 stocks in the Euro Stoxx 600 are overbought while 33 stocks are oversold according to the 16-day RSI Measure
  • VSTOXX, the European stocks equivalent of the VIX, is  moving down this morning and is currently at 16.58 after closing at 18.49 yesterday
  • EUR€ is currently little changed against the USD$ at 1.1322
  • GBP£ is currently down -0.235% against the USD$ to 1.2719
  • CHF is currently little changed against the USD$ at 1.0011
  • German 10-Year Bunds are lower with yields up 0.6 basis points to 0.319%
  • UK 10-Year GILTs are higher with yields down -1.6 basis points to 1.348%

Asian Stocks

  • Asia stocks rallied in overnight trading to start the month of December on a positive footing following news that the US will delay implementation of additional tariffs on Chinese imports following the dinner between US President Donald Trump and Chinese President Xi Jinping in Argentina during the G20 Summit 
  • The Nikkei 225 finished up +1%, the Hang Seng ended up +2.55%, the Hang Seng China Enterprise up +2.45%, and the CSI 300 was +2.78%
  • Bloomberg estimates USD$325 billion in market capitalization was added to large-cap Asian stocks overnight with investor sentiment turning positive 
  • The CNY has strengthened over 1% this morning to 6.8897 RMB/USD, the biggest one day move in the Renminbi since February 2016
  • Investor sentiment for Japanese stocks finished positive with the advance/decline ratio for the Nikkei 225 closing at 4x
  • 32 stocks in the Nikkei 225 hit 4-week highs while 7 stocks reached 4-week lows
  • 8 stocks in the Nikkei 225 closed overbought while 7 stocks closed oversold according to the 16-day RSI Measure
  • Investor sentiment for Hong Kong stocks finished positive with the advance/decline ratio for the Hang Seng closing at 9x
  • 3 stocks in the Hang Seng hit 4-week highs while 0 stocks reached 4-week lows
  • 0 stocks in the Hang Seng closed overbought while 0 stocks closed oversold according to the 16-day RSI Measure
  • Japan 2-Year Government Bonds are higher with yields down -0.1 basis points to -0.13%
  • Japan 10-Year Government Bonds are higher with yields down -0.6 basis points to 0.086%
  • JGBs 2s-10s Spread has narrowed 0.5 basis points to 0.22%
  • JPY¥ is currently little changed against the USD$ at 113.59

 

*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 2144 7.29 15 7 -0.09% 2.14%
General Motors Co 825 5.29 21 16 0.19% 0.24%
Morgan Stanley 774 8.14 1 3 -0.02% 3.62%
Microsoft Corp 682 7.14 31 30 -0.02% 4.79%
Goldman Sachs Group Inc/The 622 7.14 -1 18 -0.22% 2.81%

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
BlackRock Inc 427 9.14 -2 5 -0.9% -4.44%
Citigroup Inc 401 8.86 2 10 0.01% 5.36%
Union Pacific Corp 9 8.57 12 18 0.09% 4.94%
Wells Fargo & Co 404 8.43 -3 -14 -0.27% 1.87%
Emerson Electric Co 41 8.43 -12 -12 3.52% 3.29%

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 16.76 85.52% 15.94 83.33% 0.95 7.74% -1.69 29.37% -1.8 30.16%
QQQ 22.56 83.73% 21.3 87.5% 0.94 20.24% -5 19.84% -5.49 19.05%
IWM 19.42 85.32% 18.16 84.13% 0.94 14.09% -0.76 26.98% -2.1 19.05%
FEZ 18.81 88.49% 17.48 89.29% 0.93 17.06% 1.83 65.08% 0.78 61.9%
EEM 24.5 90.87% 21.91 85.71% 0.89 4.96% 1.36 70.04% -1.97 23.02%

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
DOMINO'S PIZZA INC DPZ Consumer Discretionary Hotels, Restaurants & Leisure 2.3% 7.63% 41.1%
MARRIOTT VACATIONS WORLDWIDE VAC Consumer Discretionary Hotels, Restaurants & Leisure 2.28% 6.51% -50.18%
TYSON FOODS INC  -CL A TSN Consumer Staples Food Products 1.92% -1.39% -31.45%
NEXSTAR MEDIA GROUP NXST Consumer Discretionary Media 1.86% 7.99% 7.0%
LIGAND PHARMACEUTICAL INC LGND Health Care Biotechnology 1.19% 8.32% 17.18%
 
Losers Ticker Sector Industry 1D Return 5D Return YTD
QUEST DIAGNOSTICS INC DGX Health Care Health Care Providers & Services -9.73% -5.82% -9.86%
COMMERCE BANCSHARES INC CBSH Financials Banks -6.15% -5.07% 11.87%
MASTERCARD INC MA Information Technology IT Services -2.82% 4.68% 26.37%
PG&E CORP PCG Utilities Electric Utilities -2.58% 9.64% -50.84%
FIDELITY NATIONAL INFO SVCS FIS Information Technology IT Services -1.96% 2.39% 13.1%

Source: S&P Capital IQ, StockDio

Top Short Winners and Losers

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Winners Ticker Sector Industry 1D Return 5D Return YTD
HERTZ GLOBAL HOLDINGS INC HTZ Industrials Road & Rail -11.72% 2.44% -21.36%
ACACIA COMMUNICATIONS INC ACIA Information Technology Communications Equipment -7.69% -7.04% 11.62%
AGIOS PHARMACEUTICALS AGIO Health Care Biotechnology -7.15% 2.37% 6.25%
SUPERIOR ENERGY SERVICES INC SPN Energy Energy Equipment & Services -4.65% -11.1% -54.2%
ARRAY BIOPHARMA INC ARRY Health Care Biotechnology -4.58% -0.26% 13.9%
 
Losers Ticker Sector Industry 1D Return 5D Return YTD
BLOOM ENERGY CORP-REDH BE Industrials Electrical Equipment 11.08% 16.26% -37.05%
ROKU INC ROKU Consumer Discretionary Household Durables 4.79% 1.46% -24.29%
ALLAKOS INC ALLK Health Care Biotechnology 3.9% 14.6% 67.51%
WPX ENERGY INC WPX Energy Oil, Gas & Consumable Fuels 3.88% 4.1% -0.91%
TENABLE HOLDINGS INC TENB Information Technology Software 3.61% 12.17% -3.98%

Source: S&P Capital IQ, StockDio

Cryptos

  • Cryptocurrency prices fell lower this weekend while Bitcoin (BTC) tested the USD$4,000 support level as the benchmark cryptocurrency is down 6.19% since Friday, 11/30/2018, to USD$4,034.29. Among major cryptocurrencies, Bitcoin Cash (BCH) fell the most, down 9.37% since Friday to USD$167.13. Ripple (XRP) and Ethereum (ETH) are down 4.95% and 4.47% since Friday’s close to USD$0.360871 and USD$113.62, respectively. Since Friday, total cryptocurrency market capitalization shed USD$9bn and currently sits a about USD$130.9bn.  
  • Japan’s Financial Services Agency (FSA) will introduce new regulations pertaining to Initial Coin Offerings (ICOs) that are meant to protect investors from fraud, as per a report this weekend by Japanese news outlet JiJi.com. The report by JiJi.com cites “informed” sources who claim that firms conducting ICOs will be required to register with Japan’s FSA. Draft regulations are expected to be submitted in time for the Japanese parliamentary session that begins in January.  
  • Saudi Arabia’s Islamic Development Bank Group (IsDB) is partnering with Tunisian startup iFinTech Solutions to develop a suite of interbank blockchain tools, as per a press release last week. The joint project will be conducted through the IsDB’s private sector arm, the Islamic Corporation for the Development of Private Sector (ICD) in order to increase Islamic financial institution's liquidity management capabilities and to improve overall efficiencies. IFinTech Solutions defines itself as an, “investment advisory firm focused on alternative financial solutions based on Islamic principles.” 
  • This weekend’s G20 Summit in Buenos Aires, Argentina saw financial superpowers from across the globe call for the international taxation of cryptocurrency, in addition to coordinated regulation in order to combat money laundering, according to Japanese news outlet JiJi.com. A joint document released by G20 countries following this weekend’s summit calls for, “a taxation system for cross-border electronic payment services.” While G20 countries, “will consider the issue during 2019 when Japan will be the president of the summit,” a final draft of regulation is expected to be proposed and voted on in 2020. 
     

Cryptocurrencies Today

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

Events Calendar

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Source: S&P Capital IQ