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Morning Brief

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Negative guidance from Apple (AAPL) spooks global stocks

Jan 03, 2019

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Market data as of 7am EST

 

US Stocks

  • US stocks index futures are dropping sharply this morning with front-month Dow Jones minis -1.45%, S&P 500 minis –1.43%, and Nasdaq 100 minis -2.23%
  • Negative guidance from Apple (AAPL) rattles investors and global stock markets with tech stocks plunging globally 
  • Citigroup highlights the decline in forecasted S&P 500 EPS growth for CY2019 over the past 12-weeks (going back to early October) -- Citigroup cites this as a factor in the cut to its S&P 500 CY2019 year-end target from 3,100 to 2,850
  • The VIX is moving up this morning and is currently at 26.36 after closing at 23.22 yesterday
  • ECA January 17 OTM Calls, SPY January 18 OTM Calls & Puts, USO January 18 OTM Puts and NVIDIA (NVDA) January 18 OTM Puts are some of the most actively traded options contracts in the US pre-market
  • US 10-Year Treasury Bonds are lower with yields up 1.75 basis points to 2.6379%
  • The US Treasury 2s-10s Spread has narrowed 0.27 basis points to 0.15%
  • WTI Crude is currently up 2.49% to USD$46.54/bbl with the Brent-WTI spread down USD$-1.95 to USD$7.58/bbl
  • Global oil prices are mixed this morning – WTI oil prices have tracked the decline in the S&P 500 over the course of 4Q  with worries about decelerating economic growth impairing oil valuations
  • Gold is currently little changed 0.22% to USD$1287.36/oz

Stocks Trending in the News

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

  • American Electric Power (AEP) was downgraded by Mizuho Securities to neutral from buy.  American Electric Power had its price target cut to USD$70 from USD$76.  American Electric Power’s target implies 4% downside from its last close.  American Electric Power consensus target is USD$78.94.  American Electric Power is rated “Attractive” in our US Large-Cap Global Top Stock Ideas
  • Apple (AAPL) cut its revenue forecast for fiscal 1Q19, its first guidance cut in close to 20 years.  Apple said unexpected weakness in China demand caused it to cut guidance, with USD$84 billion now expected, down from USD$89-93 billion originally expected.   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.
  • Bristol-Myers Squibb (BMY) will acquire Celgene (CELG) in a deal the values the biopharmaceutical company at USD$74bn. Celgene shareholders will receive USD$50 and one Bristol-Myers share for each Celgene share owned. Bristol-Myers is rated “Neutral” in our US Large-Cap Global Top Stock Ideas. Celgene is rated “Neutral” in our US Large-Cap Global Top Stock Ideas.
  • DNO ASA (OB: DNO) has extended a hostile bid to Faroe Petroleum Plc (AIM: FPM) after unsuccessfully convincing shareholders to sell their stock. Of late, DNO has criticized Faroe management in an attempt to convince shareholders they are better off selling. Faroe shareholders recently voted down a USD$713mm acquisition offer by DNO -- the offer only received 43% of votes despite DNO owning 30% of Faroe. DNO is rated “Unattractive” in our European SMID-Cap Global Top Stock Ideas. Faroe is not rated in our Global Top Stock Ideas.
  • Elbit Systems of America (TASE: ESLT) has been awarded a contract by Raytheon (RTN) to develop the Two Color Laser System (TCLS) for the Multi-Spectral Targeting System. The contract concerns development in 2019. Additionally, Elbit said that its IMI Systems unit will no longer continue its cluster munitions activities. Elbit is not rated in our Global Top Stock Ideas. Raytheon is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Industrials Global Top Stock Ideas.
  • Equity Bancshares (EQBK) saw its shares downgraded to market perform from outperform at Keefe, Brunette & Woods.  Equity Bancshares had its price target lowered to USD$45 from USD$47.  Equity Bancshares shares are fully valued at this level, which was cited as the main reason for the rating cut.  Equity Bancshares Apple is rated “Neutral” in our US SMID-Cap Global Top Stock Ideas.
  • First Solar (FSLR) was upgraded to buy from neutral at Goldman Sachs.   First Solar’s price target was hiked to USD$57, up from USD$48.  Goldman Sachs says it sees “green shoots” in the solar industry with a better 2019 likely.  First Solar is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Information Technology Global Top Stock Ideas.
  • Geely Automotive (SEHK: 175) was downgraded to underweight from equal weight at Morgan Stanley.  Geely Automotive had its price target slashed to USD$8 from USD$15.  Geely’s price target implies 38% downside from its last close.  Geely Automotive is rated “Neutral” in our China All-Cap Global Top Stock Ideas.
  • Johnson & Johnson (JNJ) saw its sales in India fall 3% in 2018.  Total sales in India were USD$829mm, according to a regulatory filing from Johnson & Johnson.  Johnson & Johnson’s sales fell after the Indian government decided to cap price for medical devices.  Johnson & Johnson is rated “Attractive” in our US Large-Cap Global Top Stock Ideas
  • Lumber Liquidators (LL) had its price target cut by Loop Capital, it was slashed to USD$10 from USD$24.  Lumber Liquidators rating was cut to hold from buy.  Loop Capital expects lower sales and margins for Lumber Liquidators in 2019, the main reason for the downgrade.  Lumber Liquidators is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Short” in our US Consumer Discretionary Global Top Stock Ideas.
  • Next Plc (LSE: NXT) reported sales growth during the holiday season.  Next reported a 1% rise in sales in the properties it manages, surprising most investors.  Analysts called the holiday sales data “excellent”.  Next is rated “Top Buy” in our United Kingdom Global Top Stock Ideas.
     

 

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European Stocks

  • European stocks are dropping in sympathy with the fall in US index futures 
  • The Euro Stoxx 600 is currently down -0.91%, the FTSE 100 has declined -0.51%, the DAX has fallen -1.47%, and the CAC 40 is lower by -1.38%
  • Investor sentiment for European stocks is negative with the advance/decline ratio for the Euro Stoxx 600 currently at 0.33x
  • Oil & Gas (-0.41%), Telecommunications (+0.46%), and Basic Resources (-1.6%) stocks are the top performers in the Euro Stoxx 600 today
  • Automobiles & Parts (-1.04%), Food & Beverage (-0.09%), and Utilities (-0.13%) stocks are the worst performers in the Euro Stoxx 600 today
  • 18 stocks in the Euro Stoxx 600 are at 4-week highs while 102 stocks are at 4-week lows
  • 2 stocks in the Euro Stoxx 600 are overbought while 26 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 24.14 after closing at 23.39 yesterday
  • EUR€ is currently little changed against the USD$ at 1.1344
  • GBP£ is currently down -0.373% against the USD$ to 1.256
  • CHF is currently little changed against the USD$ at 1.0111
  • German 10-Year Bunds are lower with yields up 1.4 basis points to 0.179%
  • UK 10-Year GILTs are lower with yields up 1.8 basis points to 1.227%

Asian Stocks

  • Asia stocks declined in overnight trading for Day 2 of the new year with negative revenue guidance from Apple (AAPL) last night weighing on regional tech stocks
  • Japanese markets are closed today and reopen tomorrow
  • Investor sentiment for Hong Kong stocks finished negative with the advance/decline ratio for the Hang Seng closing at 0.79x
  • 2 stocks in the Hang Seng hit 4-week highs while 24 stocks reached 4-week lows
  • 0 stocks in the Hang Seng closed overbought while 6 stocks closed oversold according to the 16-day RSI Measure
  • JPY¥ is currently down -1.222% against the USD$ to 107.55

 

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

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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
BlackRock Inc 161 6 -5 -1 -0.56% -5.64%
Netflix Inc 104 4.86 -3 -8 -2.28% -3.95%
Microsoft Corp 101 3.57 -2 29 0.04% 4.64%
Morgan Stanley 90 2.71 -3 3 -2.34% 2.88%
International Business Machines Corp 80 3 -1 -3 0.43% 0.91%

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 161 6 -5 -1 -0.56% -5.64%
Ford Motor Co 49 4.86 0 -5 -0.37% 1.01%
Netflix Inc 104 4.86 -3 -8 -2.28% -3.95%
PepsiCo Inc 11 4.57 -1 -18 -0.27% -0.49%
Starbucks Corp 18 4.29 4 1 -0.01% 4.87%

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 20.49 93.25% 20.11 95.24% 0.98 22.02% -8.46 7.54% -4.12 19.44%
QQQ 28.78 96.43% 26.81 96.43% 0.93 22.02% -7.49 15.87% -6.53 15.48%
IWM 25.1 94.44% 23.57 95.63% 0.94 18.85% -4.61 11.9% -2.45 19.05%
FEZ 21.41 93.25% 20.89 97.22% 0.98 38.1% 1.39 61.71% 2.18 76.19%
EEM 22.94 77.78% 23.39 92.06% 1.02 54.76% 3.62 86.11% -1.47 35.32%

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

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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
SUNTRUST BANKS INC STI Financials Banks 2.8% 10.07% -18.93%
BB&T CORP BBT Financials Banks 2.44% 7.29% -8.75%
TORCHMARK CORP TMK Financials Insurance 2.44% 7.84% -15.92%
SYNOVUS FINANCIAL CORP SNV Financials Banks 2.13% 7.73% -36.64%
ZIONS BANCORPORATION ZION Financials Banks 2.04% 7.67% -17.88%
 
Losers Ticker Sector Industry 1D Return 5D Return YTD
HILL-ROM HOLDINGS INC HRC Health Care Health Care Equipment & Supplies -4.06% 2.59% 1.35%
ABBOTT LABORATORIES ABT Health Care Health Care Equipment & Supplies -3.99% 5.84% 18.54%
SUN COMMUNITIES INC SUI Real Estate Equity Real Estate Investment Trusts (REITs) -3.93% 0.92% 9.34%
EXPRESS SCRIPTS HOLDING CO ESRX Health Care Health Care Providers & Services -3.69% -6.92% 20.48%
ANTHEM INC ANTM Health Care Health Care Providers & Services -2.94% 2.39% 13.26%

Source: S&P Capital IQ, StockDio

Top Short Winners and Losers

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Winners Ticker Sector Industry 1D Return 5D Return YTD
TANDEM DIABETES CARE INC TNDM Health Care Health Care Equipment & Supplies -11.04% 5.72% 259.42%
INSULET CORP PODD Health Care Health Care Equipment & Supplies -7.72% -0.18% 6.22%
PORTOLA PHARMACEUTICALS INC PTLA Health Care Biotechnology -3.92% 17.22% -95.47%
INTERCEPT PHARMA INC ICPT Health Care Biotechnology -3.58% 11.75% 54.57%
TENABLE HOLDINGS INC TENB Information Technology Software -3.39% -0.33% -34.38%
 
Losers Ticker Sector Industry 1D Return 5D Return YTD
PENNEY (J C) CO JCP Consumer Discretionary Multiline Retail 9.18% 11.12% -112.17%
SOUTHWESTERN ENERGY CO SWN Energy Oil, Gas & Consumable Fuels 8.7% 13.51% -46.29%
FITBIT INC FIT Information Technology Electronic Equipment, Instruments & Components 7.74% 15.04% -11.26%
PUMA BIOTECHNOLOGY INC PBYI Health Care Biotechnology 6.33% 6.68% -145.24%
GENERAL ELECTRIC CO GE Industrials Industrial Conglomerates 6.15% 15.13% -77.54%

Source: S&P Capital IQ, StockDio

Cryptos

  • Cryptocurrencies are mixed across the board with the price of Bitcoin (BTC) up 0.57% in the last 24 hours to USD$3,875.27. Ethereum (ETH) and Ripple (XRP) are both trading lower, meanwhile, down 0.06% and 0.53% in the last 24 hours to USD$149.96 and USD$0.36448, respectively. Among major cryptocurrencies, Monero is posting the largest gains, up 2.37% in the last 24 hours to USD$50.48. Ethereum Classic (ETC) and Bitcoin SV (BSV) lag major coins, down 2.37% and 2.01% in the last 24 hours to USD$5.20 and USD$90.33, respectively. 
  • New York State Assemblyman and Chair of the state’s Subcommittee on Internet and New Technologies, Clyde Vanel, announced the formation of the country’s, “first,” cryptocurrency task force. In a Facebook post Thursday morning, Vanel detailed that the crypto task force will study the regulation, use, and definition of digital currency. Last month on December 21st, 2018, New York Governor Andrew Cuomo signed the bill, “The Digital Currency Study Bill,”, resulting in the creation of the crypto task force. 
  • Lenders in the cryptocurrency industry are among the few to weather the recent crypto bear mark, as per a Bloomberg report. The Bloomberg report highlights that crypto industry lenders are, “finding strong demand from borrowers who don’t want to sell their virtual coins at depressed prices, as well as from big investors eager to borrow coins for short selling.” The report goes on to highlights BlockFi, a crypto industry lender who, since receiving a USD$52mm investment from Mike Novogratz’s Galaxy Digital in June, has grown tenfold.  
  • Thailand’s The National Electronics and Computer Technology Center (NECTEC) has developed blockchain technology to be implemented in e-voting, according to a report by the Bangkok Post. Head of the Cybersecurity Laboratory at NECTEC, Chalee Vorakulipat, said on the blockchain technology, “Nectec developed blockchain technology for e-voting that can be applied to national, provincial, or community elections, as well as business votes such as the board of directors. The goal is to reduce fraud and maintain data integrity.”
     

Cryptocurrencies Today

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

High Machine Learning Accuracy Rates for Cryptocurrencies
High Machine Learning Accuracy Rates for Cryptocurrencies

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