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Morning Brief

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

Global stocks are off early morning highs as US-China trade negotiations remain in focus

Dec 13, 2018

 

 

Market data as of 7am EST

 

US Stocks

  • US stocks index futures are currently mixed and point to a “neutral” open in NY after dropping from early morning highs with front-month Dow Jones minis –0.18%, S&P 500 minis –0.05% and NASDAQ 100 minis +0.13%
  • According to the Ryan Labs Cash index (and Bloomberg News), cash is “outperforming” both the S&P 500 and the Barclays US Aggregate Bond index this year (a/o Tuesday’s close) -- this would be the first time cash has outperformed both asset classes since 1994
  • The VIX is little changed this morning and is currently at 21.33 after closing at 21.46 yesterday
  • EEM December 21 and January 2019 OTM Calls, Bank of America (BAC) December 14 OTM Calls, and HYG December 21 OTM Calls are some of the most actively traded options contracts in the US pre-market
  • US 10-Year Treasury Bonds are higher with yields down -1.63 basis points to 2.8933%
  • The US Treasury 2s-10s Spread has narrowed 0.81 basis points to 0.13%
  • WTI Crude is currently down -0.97% to USD$51.15/bbl with the Brent-WTI spread up USD$0.56 to USD$7.76/bbl
  • Gold is currently down -0.28% to USD$1242.21/oz

Stocks Trending in the News

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

  • Apple (AAPL) said it plans to invest USD$1 billion to build a new campus in Austin, Texas that could eventually have 15,000 employees.  Apple will also open new offices in San Diego and Culver City, California.  Apple is making the investments in an effort to make good on its promise to strengthen its contributions to the American economy.  Apple 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.
  • Ball Corporation (BLL) announced intentions to sell its metal beverage packaging facilities in China to ORG Technology Co. Ltd. (SZSE: 002701). ORG Technology will pay USD$225mm in total for the Chinese facilities with the deal expected to close in the second half of 2019. Ball Corporation is rated “Neutral” in our US Large-Cap Global Top Stock Ideas. ORG Technology is not rated in our Global Top Stock Ideas.
  • Ciena Corporation (CIEN) reports FY4Q2018 financials that contains strong 3-year guidance. Ciena reported FY4Q2019 revenue of 899.36mm while consensus estimates called for USD$862.54mm. Additionally, Ciena forecasted annual revenue growth to range between 6% and 8% over the next 3 years. Ciena Corporation is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Information Technology Global Top Stock Ideas.
  • FireEye (FEYE) is being downgraded from overweight to equal-weight at Morgan Stanley while maintaining its price target of USD$21/share. Morgan Stanley wrote that it sees, “limited upside,” at current trading levels based on a sum-of-parts analysis. FireEye is rated “Top Short” in our US Large-Cap Global Top Stock Ideas and “Top Short” in our US Information Technology Global Top Stock Ideas.
  • Fred’s (FRED) reported 3Q results of an 83 cents per share loss.  Fred’s saw same store sales fall 5.3% in 3Q.  Fred’s saw 3Q net sales of USD$306.4mn.  Fred’s said it continues to evaluate potential opportunities to monetize all non-core assets.  Fred’s is rated “Neutral” in our US SMID-Cap Global Top Stock Ideas and “Unattractive” in our US Consumer Discretionary Global Top Stock Ideas.
  • GAM Holdings (SWX: GAM) said it is having problems stemming outflows from its asset management business in the wake of its scandal involving a well-known portfolio manager.  GAM Holdings said it will post a loss of USD$931mn for this year as it is forced to write-down the value of its business.  GAM Holdings will also cut 10% of its workforce.  GAM Holdings is rated “Neutral” in our European SMID-Cap Global Top Stock Ideas.
  • General Electric (GE) was upgraded by JP Morgan to neutral from overweight.  JP Morgan set GE’s price target at USD$6, a market low.  The consensus price target for GE is presently USD$11.38.  General Electric is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas and “Unattractive” in our US Industrials Global Top Stock Ideas.
  • G4S Plc (LSE GFS) is considering an exit from the armored car business via an IPO of its unit.  G4S said the dwindling use of physical notes in developed countries has led to its consideration of an IPO.  G4S said the unit could be worth about USD$2 billion and G4S rose the most in 2 years on the news.  G4S is rated “Top Short” in our United Kingdom All-Cap Global Top Stock Ideas.
  • Japan Post (TSE 6178) will buy a stake in US insurer Aflac (AFL), according to the Nikkei newspaper.  Japan Post will spend USD$2.6 billion to buy a 7-8% stake in Aflac.  The holding would become an equity-method affiliate in about 4 years, the report notes.  Japan Post is making the investments as it seeks to boost long-term profitability.  Japan Post is rated “Neutral” in our Japan Large-Cap Global Top Stock Ideas.  Aflac is rated “Attractive” in our US Large-Cap Global Top Stock Ideas.
  • Metro AG (DB: B4B) shares are falling after CEO Olaf Koch said on the sidelines of the company’s annual press conference that its efforts to reverse sales declines in Russia will take another 2 to 3 quarters. Koch detailed further that, while he is optimistic of the company’s turnaround in Russia, FY2018 and FY2019 profit in the country will still fall. Metro AG is rated “Neutral” in our European SMID-Cap Global Top Stock Ideas.
  • Oracle (ORCL) has filed a second lawsuit against the US Defense Department over its choice of choice of a vendor for the Pentagon’s JEDI program.  Oracle claims the contract was written to benefit Amazon’s (AMZN) Web Services and wants the contract rewritten.  Previous complaints to the US General Accounting Office were unsuccessful.   Oracle is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Information Technology Global Top Stock Ideas.  Amazon is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Discretionary Global Top Stock Ideas.
  • Seaworld Entertainment (SEAS) said the US Department of Justice has closed its investigation without taking any action.  The investigation of Seaworld Entertainment involved its response to a film critical of its business and subsequent disclosures related to its response.  Seaworld Entertainment said the Justice Department now considers the matter concluded.  Seaworld Entertainment is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Discretionary Global Top Stock Ideas.
  • XXL ASA (OB: XXL) shares are trading down after being downgraded by Credit Suisse from outperform to neutral. Additionally, Credit Suisse slashed its price target for XXL by 37.14% from 70 Norwegian Krone/share to 44 Norwegian Krone/share. Credit Suisse cited concerns of current leverage posing a risk to the firm’s dividend payments as the reason for the downgrade and price target cut. XXL is rated “Unattractive” in our European SMID-Cap Global Top Stock Ideas.

 

 

European Stocks

  • European stocks are little changed this morning, off early morning highs   
  • The Euro Stoxx 600 is currently down -0.06%, the FTSE 100 has declined -0.09%, the DAX has advanced +0.17%, and the CAC 40 is lower by -0.04%
  • After surviving a confidence vote Wednesday night, UK Prime Minister Theresa May is in Brussels attempting to negotiate for increased concessions, notably on the “Ireland Question” as she tries to build support for a BREXIT vote in the UK Parliament
  • Goldman Sachs believes UK Prime Minister Theresa May’s victory last night among her Conservative Party colleagues will serve as a “Pyrrhic Victory” with the possibility that BREXIT could be reversed – Goldman is suggesting that the support for BREXIT outside of Prime Minister May’s Conservative Party is limited (remember that PM May was part of the Conservative Party that advocated for “Remain” ahead of the BREXIT referendum)
  • The European Central Bank (ECB) is set to lower its inflation target for CY2019 today as it publishes its outlook for the new year – previous expectations were for inflation of +1.7% 
  • Banks in the Eurozone are rallying following news that the German government is considering a forced merger of Deutsche Bank (DB: DBK) and Commerzbank  (DB: CBK)
  • Italian stocks are positive amid rumors of a new deficit target of 2.04% for CY2019, down from an initial proposal of 2.4% and is seen as a “real” concession by the Italian Coalition Government to the EU
  • Investor sentiment for European stocks is negative with the advance/decline ratio for the Euro Stoxx 600 currently at 0.82x
  • Oil & Gas (-0.72%), Telecommunications (-0.24%), and Basic Resources (+0.6%) stocks are the top performers in the Euro Stoxx 600 today
  • Automobiles & Parts (+1.1%), Food & Beverage (-0.13%), and Utilities (+0.79%) stocks are the worst performers in the Euro Stoxx 600 today
  • 40 stocks in the Euro Stoxx 600 are at 4-week highs while 40 stocks are at 4-week lows
  • 10 stocks in the Euro Stoxx 600 are overbought while 25 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 18.99 after closing at 19.73 yesterday
  • EUR€ is currently little changed against the USD$ at 1.1376
  • GBP£ is currently up +0.158% against the USD$ to 1.2649
  • CHF is currently up +0.179% against the USD$ to 1.0083
  • German 10-Year Bunds are higher with yields down -0.5 basis points to 0.274%
  • UK 10-Year GILTs are higher with yields down -3.3 basis points to 1.246%

Asian Stocks

  • Asia stocks finished positive in overnight trading with a 2-day rally across the region bringing Asian stocks into the green for the week
  • The Nikkei 225 finished up +0.99%, the Hang Seng ended up +1.29%, the Hang Seng China Enterprise up +1.34%, and the CSI 300 was +1.55%
  • Investor sentiment is improving as trade tensions between the US and China ease while market expectations grow for stimulative tax policy from Beijing towards tech-related industries
  • Investor sentiment for Japanese stocks finished positive with the advance/decline ratio for the Nikkei 225 closing at 3.69x
  • 8 stocks in the Nikkei 225 hit 4-week highs while 15 stocks reached 4-week lows
  • 2 stocks in the Nikkei 225 closed overbought while 15 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 11.5x
  • 0 stocks in the Hang Seng hit 4-week highs while 1 stock reached 4-week lows
  • 0 stocks in the Hang Seng closed overbought while 3 stocks closed oversold according to the 16-day RSI Measure
  • Japan 2-Year Government Bonds are higher with yields down -0.7 basis points to -0.144%
  • Japan 10-Year Government Bonds are lower with yields up 0.2 basis points to 0.057%
  • JGBs 2s-10s Spread has widened 0.9 basis points to 0.2%
  • JPY¥ is currently little changed against the USD$ at 113.44

 

*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 469 1.57 0 8 -0.47% 0.63%
JPMorgan Chase & Co 259 2.86 -2 11 -0.04% 3.09%
BlackRock Inc 205 5 -5 1 -1.99% -5.48%
International Business Machines Corp 187 4.57 0 -1 0.1% 0.64%
Citigroup Inc 183 3.29 0 9 -0.04% 5.49%

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
Visa Inc 68 6 -1 3 0.01% 4.63%
Apple Inc 149 5.29 -19 -17 -1.84% -0.12%
BlackRock Inc 205 5 -5 1 -1.99% -5.48%
Mastercard Inc 26 4.86 -1 17 0.0% 4.27%
Microsoft Corp 144 4.71 0 30 -0.12% 4.34%

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 18.35 92.86% 18.21 95.24% 0.99 21.23% -2.53 26.79% -1.37 35.32%
QQQ 23.88 85.91% 23.82 96.83% 1 40.67% -5 22.42% -4.96 22.22%
IWM 22.14 93.65% 21.34 97.22% 0.96 22.02% -1.75 22.22% -1.03 26.19%
FEZ 19.77 90.87% 18.34 93.25% 0.93 17.86% 0.63 53.57% 0.37 55.56%
EEM 22.51 78.97% 22.86 94.25% 1.02 51.39% -0.83 45.44% -2.15 22.62%

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
FIRSTCASH INC FCFS Financials Consumer Finance 3.6% 1.67% 21.9%
DARDEN RESTAURANTS INC DRI Consumer Discretionary Hotels, Restaurants & Leisure 3.44% -2.29% 11.66%
BROADCOM INC AVGO Information Technology Semiconductors & Semiconductor Equipment 3.24% 9.43% -1.78%
HILL-ROM HOLDINGS INC HRC Health Care Health Care Equipment & Supplies 2.69% 0.52% 13.83%
CULLEN/FROST BANKERS INC CFR Financials Banks 2.5% -0.85% 2.93%
 
Losers Ticker Sector Industry 1D Return 5D Return YTD
SERVICEMASTER GLOBAL HLDGS SERV Consumer Discretionary Diversified Consumer Services -7.41% -11.56% 51.91%
VAIL RESORTS INC MTN Consumer Discretionary Hotels, Restaurants & Leisure -5.54% -18.07% 8.47%
VERIZON COMMUNICATIONS INC VZ Telecommunication Services Diversified Telecommunication Services -2.76% -1.46% 11.34%
SUN COMMUNITIES INC SUI Real Estate Equity Real Estate Investment Trusts (REITs) -1.52% 0.9% 16.7%
DUKE ENERGY CORP DUK Utilities Electric Utilities -1.32% -0.5% 11.92%

Source: S&P Capital IQ, StockDio

Top Short Winners and Losers

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Winners Ticker Sector Industry 1D Return 5D Return YTD
NEUROCRINE BIOSCIENCES INC NBIX Health Care Biotechnology -14.98% -15.54% -7.15%
REGENXBIO INC RGNX Health Care Biotechnology -6.61% -8.71% 36.4%
MOSAIC CO MOS Materials Chemicals -6.54% -12.94% 15.39%
MACERICH CO MAC Real Estate Equity Real Estate Investment Trusts (REITs) -4.58% -5.09% -29.4%
SOUTHWESTERN ENERGY CO SWN Energy Oil, Gas & Consumable Fuels -3.85% -10.02% -37.05%
 
Losers Ticker Sector Industry 1D Return 5D Return YTD
PORTOLA PHARMACEUTICALS INC PTLA Health Care Biotechnology 10.09% 3.64% -81.56%
INTERCEPT PHARMA INC ICPT Health Care Biotechnology 5.68% 4.41% 67.52%
CARVANA CO CVNA Consumer Discretionary Specialty Retail 5.58% -7.12% 66.94%
PATTERSON-UTI ENERGY INC PTEN Energy Energy Equipment & Services 4.65% -2.54% -55.14%
ARRAY BIOPHARMA INC ARRY Health Care Biotechnology 4.37% 3.92% 17.49%

Source: S&P Capital IQ, StockDio

Cryptos

  • Cryptocurrencies turned lower overnight as the price of Bitcoin (BTC) is down 1.86% in the last 24 hours to USD$3,421.19. All major cryptocurrencies are trading down this morning as EOS (EOS) is the best performer, down 0.59% in the last 24 hours to USD$1.94. Bitcoin SV (BSV), meanwhile, is down the most among major coins, down 5.90% in the last 24 hours to USD$85.80. Total cryptocurrency market capitalization now sits at USD$108.6bn, down from USD$110.4bn 24 hours earlier.  
  • Following a case in Canadian courts that resulted in a ruling ordering mistakenly sent crypto funds to be returned to their owner, a blog post from the University of Oxford Faculty of Law is noting that there could be repercussions with the case potentially setting a precedent for lost or stolen cryptocurrency claims. The Canadian court case’s ruling will require defendant Brian Wall to return USD$370,482 worth of Ethereum (ETH) tokens to the plaintiff, Copytrack. The blog post from the University of Oxford Faculty of Law reads, ‘This precedent may have major repercussions for the enforcement of claims regarding lost or stolen cryptocurrencies,” adding that the ruling allows the plaintiff to recover tokens, “in whatsoever hands those Ether Tokens may currently be held.” 
  • Venezuela is reportedly beginning to convert its citizens’ monthly pension payments into Petros, Venezuela’s controversial state and oil-backed cryptocurrency, according to a report by local economics blog the Caracas Chronicles. The conversion of Venezuelan pensioners’ payments into Petros came after the country already sent pensioners their monthly payment in the form of a check for Venezuelan Bolivars -- normally, upon receiving their check, pensioners would deposit their funds into a bank account where they could then withdraw fiat from local branches. The Venezuelan government, however, converted pensioners’ fiat payments into the Petro upon their deposit into a bank. In the first few weeks of the Petro’s existence, its value has risen from 9,000 to more than 15,000. 
     

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
Razer Inc. SEHK:1337 12/13/2018 Estimated Earnings Release Date China All-Cap: F
China Everbright Limited SEHK:165 12/13/2018 Estimated Earnings Release Date China All-Cap: B
Shuang Yun Holdings Limited SEHK:1706 12/13/2018 Estimated Earnings Release Date China All-Cap: F
Hope Education Group Co., Ltd. SEHK:1765 12/13/2018 Estimated Earnings Release Date China All-Cap: F
Sunac China Holdings Limited SEHK:1918 12/13/2018 Estimated Earnings Release Date China All-Cap: C
51 Credit Card Inc. SEHK:2051 12/13/2018 Estimated Earnings Release Date China All-Cap: D
China Huarong Asset Management Co., Ltd. SEHK:2799 12/13/2018 Estimated Earnings Release Date China All-Cap: F
Vobile Group Limited SEHK:3738 12/13/2018 Estimated Earnings Release Date China All-Cap: D
Beijing Enterprises Holdings Limited SEHK:392 12/13/2018 Estimated Earnings Release Date China All-Cap: B
China Communications Services Corporation Limited SEHK:552 12/13/2018 Estimated Earnings Release Date China All-Cap: B
Pan Asia Environmental Protection Group Limited SEHK:556 12/13/2018 Estimated Earnings Release Date China All-Cap: D
Beijing Capital International Airport Company Limited SEHK:694 12/13/2018 Estimated Earnings Release Date China All-Cap: B
Sinopec Kantons Holdings Limited SEHK:934 12/13/2018 Estimated Earnings Release Date China All-Cap: C
Adobe Inc. ADBE 12/13/2018 Estimated Earnings Release Date US Large-Cap: A, US Information Technology: C
Sanderson Farms, Inc. SAFM 12/13/2018 Estimated Earnings Release Date US Large-Cap: F, US Consumer Staples: C
Prada S.p.A SEHK:1913 12/13/2018 Estimated Earnings Release Date China All-Cap: C
SCUD Group Limited SEHK:1399 12/14/2018 Estimated Earnings Release Date China All-Cap: F
China Merchants Port Holdings Company Limited SEHK:144 12/14/2018 Estimated Earnings Release Date China All-Cap: C
Hingtex Holdings Limited SEHK:1968 12/14/2018 Estimated Earnings Release Date China All-Cap: D
China New Higher Education Group Limited SEHK:2001 12/14/2018 Estimated Earnings Release Date China All-Cap: D
E-House (China) Enterprise Holdings Limited SEHK:2048 12/14/2018 Estimated Earnings Release Date China All-Cap: C
China Minsheng Financial Holding Corporation Limited SEHK:245 12/14/2018 Estimated Earnings Release Date China All-Cap: F
China Xinhua Education Group Limited SEHK:2779 12/14/2018 Estimated Earnings Release Date China All-Cap: D
Tracker Fund Of Hong Kong SEHK:2800 12/14/2018 Estimated Earnings Release Date China All-Cap: D
China Shineway Pharmaceutical Group Limited SEHK:2877 12/14/2018 Estimated Earnings Release Date China All-Cap: C
China High Speed Transmission Equipment Group Co., Ltd. SEHK:658 12/14/2018 Estimated Earnings Release Date China All-Cap: D
EPI (Holdings) Limited SEHK:689 12/14/2018 Estimated Earnings Release Date China All-Cap: D
Tianneng Power International Limited SEHK:819 12/14/2018 Estimated Earnings Release Date China All-Cap: D
NetDragon Websoft Holdings Limited SEHK:777 12/16/2018 Estimated Earnings Release Date China All-Cap: C

Source: S&P Capital IQ