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Morning Brief

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

Global stocks in the red while US index futures point to a positive open in NY

Dec 18, 2018

 

Market data as of 7:30am

 

US Stocks

  • US stocks index futures appear bucking the trend in European and Asia markets this morning and point to a positive open in NY with front-month Dow Jones minis +0.32%, S&P 500 minis +0.33% and Nasdaq 100 minis +0.51%
  • According to analysis by Bloomberg, the S&P 500 and Dow Jones are on pace for their worst December since 1931 -- just as a comparison, the S&P 500 is on pace for a monthly decline of 7.8% which compares to a 6% decline in December 2002
  • Morgan Stanley Wealth Management highlights increased correlations between stocks and bonds, suggesting bonds may not provide a typical cushion against losses in stocks
  • A survey of money managers by Bank of America suggests they are overly defensive with disproportionate portfolio allocations to bonds – the survey suggests there was a 23 pt change in allocations to bonds M/M in December which would be the largest one-month rotation in the history of the Bank of America global fund manager survey
  • The Federal Reserve is scheduled to announce its interest rate decision tomorrow at 2pm EST
  • The VIX is little changed this morning and is currently at 24.16 after closing at 24.52 yesterday
  • EWZ December 21 OTM Calls, SPY December 21 OTM Puts, and EWZ 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 -3.24 basis points to 2.8246%
  • The US Treasury 2s-10s Spread has widened 0.08 basis points to 0.17%
  • WTI Crude is currently down -2.58% to USD$49.88/bbl with the Brent-WTI spread up USD$1.56 to USD$7.36/bbl
  • Gold is currently up 0.33% to USD$1250.02/oz
  • Global oil prices are plunging to start the morning with no obvious driver – appears to be worries about decelerating growth that is also plaguing global stocks and global bonds markets

 

Stocks Trending in the News

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

  • Apple (AAPL) will introduce a technical fix to its Apple Pay app to satisfy Swiss regulators.  The technical fix will stop Apple Pay from interrupting payments with the Twint app.  With this action from Apple, Swiss authorities will suspend its investigation into Apple.  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.
  • A Brazilian Superior Labor court has revoked the regional labor court ruling allowing the Embraer (ERJ)/Boeing (BA) commercial aviation JV.  The judge said these negotiations are not within the purview of labor courts- the allegations was that the deal could cost Brazil jobs.  Embraer is rated “Neutral” in our Brazil All-Cap Global Top Stock Ideas.  Boeing is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Industrials Global Top Stock Ideas.
  • CNOOC-China National Offshore Oil Corp (SEHK 883) CEO said China’s offshore exploration business will be more open to international players.  He went on to add that authorities may proposed new, more favorable policies for international players.  He said new blocks will be added to the international cooperation area.  CNOOC is rated “Attractive” in our China All-Cap Global Top Stock Ideas.
  • National Grid (LSE: NG) shares are falling after regulator Ofgem proposed gas and power rates than expected.  Ofgem chose pricing that will save consumers USD$8.2 billion.  Ofgem set the cost of equity return at 3% from 2021 on, a record low and half of previous levels.  Ofgem said in a statement “This will result in lower returns for investors and more savings for consumers” and National Grid shares fell in the wake of the statement.  National Grid is rated “Neutral” in our United Kingdom Global Top Stock Ideas.
  • Oracle (ORCL) reported 2Q adjusted revenue of USD$9.57 billion, beating consensus of USD$9.52 billion.  Oracle 2Q adjusted EPS of 80 cents came above 78 cents consensus.  2Q cloud revenue was USD$6.64 billion while service revenue was 817mn.  Oracle 2Q operating margin was 43%.  Oracle sees revenue growing 2-4% in the coming quarter and higher in the second half of 2019.  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.
  • Sprint (S) and T-Mobile (TMUS) received national security approval for their merger.  The Committee on Foreign Investment in the US has approved the USD$26 billion merger.  The companies still need approval from the US FCC and Department of Justice anti-trust division.  Sprint is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas.  T-Mobile US is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas.
  • Twitter (TWTR) said it is investigating unusual traffic that may be from state sponsored hackers.  Twitter also said a security firm told it hackers may also have tried to use the platform to steal data.  Twitter said it has seen unusually activity from IP addresses in China and Saudi Arabia that could be hackers.  Twitter said it has informed law enforcement.  Twitter is rated “Attractive” in our US Large-cap Global Top stock Ideas and “Top Buy” in our US Information technology Global Top Stock Ideas.
     

 

 

European Stocks

  • European stocks are mixed this morning, off early morning lows
  • The Euro Stoxx 600 is currently down -0.17%, the FTSE 100 has declined -0.48%, the DAX has advanced +0.45%, and the CAC 40 has risen +0.05%
  • Business sentiment in Germany, as measured by the Ifo Institute Business Climate index, declines to its lowest level in 2 years
  • Investor sentiment for European stocks is neutral with the advance/decline ratio for the Euro Stoxx 600 currently at 1.1x
  • Oil & Gas (-1.5%), Telecommunications (-1.52%), and Basic Resources (-0.14%) stocks are the top performers in the Euro Stoxx 600 today
  • Automobiles & Parts (+1.62%), Food & Beverage (-0.6%), and Utilities (-1.55%) stocks are the worst performers in the Euro Stoxx 600 today
  • 25 stocks in the Euro Stoxx 600 are at 4-week highs while 142 stocks are at 4-week lows
  • 10 stocks in the Euro Stoxx 600 are overbought while 62 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 19.55 after closing at 19.82 yesterday
  • EUR€ is currently up +0.432% against the USD$ to 1.1397
  • GBP£ is currently up +0.594% against the USD$ to 1.2699
  • CHF is currently up +0.258% against the USD$ to 1.0097
  • German 10-Year Bunds are higher with yields down -1.7 basis points to 0.239%
  • UK 10-Year GILTs are higher with yields down -1.2 basis points to 1.254%
     

Asian Stocks

  • Asian stocks slumped in overnight trading as Chinese President Xi Jinping’s speech on the four decades of reform in China disappointed traders
  • The Nikkei 225 finished down --1.82%, the Hang Seng ended down -1.05%, the Hang Seng China Enterprise declined -1.17%, and the CSI 300 was -1.04%
  • CSI 300 is on pace for its worst annual decline since CY2011
  • The Japanese government cuts its forecasts for GDP growth in CY2019, citing escalating global trade tensions and natural global disasters
  • Investor sentiment for Japanese stocks finished negative with the advance/decline ratio for the Nikkei 225 closing at 0.12x
  • 7 stocks in the Nikkei 225 hit 4-week highs while 27 stocks reached 4-week lows
  • 1 stock in the Nikkei 225 closed overbought while 13 stocks 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 0.19x
  • 2 stocks in the Hang Seng hit 4-week highs while 3 stocks 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 -0.3 basis points to -0.154%
  • Japan 10-Year Government Bonds are higher with yields down -1.5 basis points to 0.026%
  • JGBs 2s-10s Spread has narrowed 1.2 basis points to 0.18%
  • JPY¥ is currently down -0.505% against the USD$ to 112.26
     

 

*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
Apple Inc 109 0.43 -15 -22 -1.27% -0.65%
International Business Machines Corp 91 1.43 0 -1 -0.11% 0.3%
Microsoft Corp 73 1 -1 30 -0.12% 4.29%
Johnson & Johnson 71 2.57 -2 12 -0.11% 1.69%
BlackRock Inc 65 1 -6 1 -1.88% -5.4%

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
Mastercard Inc 17 5.14 2 19 -0.05% 4.25%
UnitedHealth Group Inc 9 4.43 0 21 0.4% 5.17%
Walt Disney Co/The 17 3.29 -3 -15 -1.14% -3.24%
Caterpillar Inc 6 3 0 4 0.21% 2.85%
Costco Wholesale Corp 26 3 -6 -1 1.53% 4.66%

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 21.7 98.02% 21.25 100.0% 0.98 18.25% -0.32 45.83% 1.21 48.81%
QQQ 29.18 99.6% 27.05 100.0% 0.93 19.05% -0.88 44.05% -2.22 32.94%
IWM 27.12 99.6% 24.87 100.0% 0.92 7.94% 2.17 65.08% 1.97 51.19%
FEZ 18.7 85.32% 19.09 93.65% 1.02 49.4% -0.67 40.08% 1.04 66.67%
EEM 25.08 93.25% 24.42 99.21% 0.97 27.98% 2.79 80.16% -0.4 46.23%

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
VAIL RESORTS INC MTN Consumer Discretionary Hotels, Restaurants & Leisure 1.77% -2.56% 10.02%
HUMANA INC HUM Health Care Health Care Providers & Services 1.09% -1.34% 19.15%
FLEETCOR TECHNOLOGIES INC FLT Information Technology IT Services 0.77% -4.17% -8.39%
EAGLE MATERIALS INC EXP Materials Construction Materials 0.76% -6.83% -63.74%
MARTIN MARIETTA MATERIALS MLM Materials Construction Materials 0.49% -2.45% -23.87%
 
Losers Ticker Sector Industry 1D Return 5D Return YTD
FORTINET INC FTNT Information Technology Software -6.62% -9.04% 43.09%
PG&E CORP PCG Utilities Electric Utilities -6.23% -5.76% -59.9%
CHURCH & DWIGHT INC CHD Consumer Staples Household Products -4.86% -1.68% 29.74%
AMERICAN EXPRESS CO AXP Financials Consumer Finance -4.37% -4.46% 3.67%
EPAM SYSTEMS INC EPAM Information Technology IT Services -4.28% -6.77% 5.26%

Source: S&P Capital IQ, StockDio

Top Short Winners and Losers

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Winners Ticker Sector Industry 1D Return 5D Return YTD
BLOOM ENERGY CORP-REDH BE Industrials Electrical Equipment -10.21% -29.76% -67.33%
TENABLE HOLDINGS INC TENB Information Technology Software -10.0% -18.38% -26.1%
PIVOTAL SOFTWARE INC PVTL Information Technology Software -9.72% -13.33% 0.32%
GULFPORT ENERGY CORP GPOR Energy Oil, Gas & Consumable Fuels -8.89% -19.29% -52.42%
ALLAKOS INC ALLK Health Care Biotechnology -6.89% -10.05% 59.5%
 
Losers Ticker Sector Industry 1D Return 5D Return YTD
HERTZ GLOBAL HOLDINGS INC HTZ Industrials Road & Rail 3.48% -8.61% -43.8%
CARVANA CO CVNA Consumer Discretionary Specialty Retail 1.91% -7.92% 58.21%
OCEANEERING INTERNATIONAL OII Energy Energy Equipment & Services 1.8% -3.24% -39.74%
SUPERIOR ENERGY SERVICES INC SPN Energy Energy Equipment & Services 1.3% -6.74% -96.03%
BAKER HUGHES A GE CO BHGE Energy Energy Equipment & Services 0.79% 1.63% -37.57%

Source: S&P Capital IQ, StockDio

 

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
FactSet Research Systems Inc. FDS 12/18/2018 Earnings Release Date US Large-Cap: A
Darden Restaurants, Inc. DRI 12/18/2018 Earnings Release Date US Large-Cap: A, US Consumer Discretionary: A
Micron Technology, Inc. MU 12/18/2018 Earnings Release Date US Large-Cap: C, US Information Technology: B
Jabil Inc. JBL 12/18/2018 Earnings Release Date US Large-Cap: C, US Information Technology: C
FedEx Corporation FDX 12/18/2018 Earnings Release Date US Large-Cap: C, US Industrials: B
Renren Inc. RENN 12/18/2018 Estimated Earnings Release Date China All-Cap: F
General Mills, Inc. GIS 12/19/2018 Earnings Release Date US Large-Cap: A, US Consumer Staples: A
Paychex, Inc. PAYX 12/19/2018 Earnings Release Date US Large-Cap: B, US Information Technology: C
Zai Lab Limited ZLAB 12/19/2018 Estimated Earnings Release Date China All-Cap: D
iKang Healthcare Group, Inc. KANG 12/20/2018 Earnings Release Date China All-Cap: C
Walgreens Boots Alliance, Inc. WBA 12/20/2018 Earnings Release Date US Large-Cap: B, US Consumer Staples: B
Carnival Corporation CCL 12/20/2018 Earnings Release Date US Large-Cap: B, US Consumer Discretionary: A
Conagra Brands, Inc. CAG 12/20/2018 Earnings Release Date US Large-Cap: C, US Consumer Staples: B
NIKE, Inc. NKE 12/20/2018 Earnings Release Date US Large-Cap: D, US Consumer Discretionary: B
Cintas Corporation CTAS 12/20/2018 Earnings Release Date US Large-Cap: A, US Industrials: B
Adobe Inc. ADBE 12/20/2018 Estimated Earnings Release Date US Large-Cap: A, US Information Technology: C
Sanderson Farms, Inc. SAFM 12/20/2018 Estimated Earnings Release Date US Large-Cap: F, US Consumer Staples: C
Prada S.p.A SEHK:1913 12/20/2018 Estimated Earnings Release Date China All-Cap: C
CarMax, Inc. KMX 12/20/2018 Earnings Release Date US Large-Cap: C, US Consumer Discretionary: C
Greentown Service Group Co. Ltd. SEHK:2869 12/20/2018 Estimated Earnings Release Date China All-Cap: C
SIG plc SHI 12/21/2018 Estimated Earnings Release Date China All-Cap: C

Source: S&P Capital IQ