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Morning Brief

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Global stocks retrace gains following disappointing earnings results from JP Morgan (JPM)

Jan 15, 2019

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Market data as of 7am EST

 

US Stocks

  • US stocks index futures are little changed, off early morning highs, with front-month Dow Jones minis +0.04%, S&P 500 minis +0.12%, and Nasdaq 100 minis +0.37%
  • Stocks strategists at the Capital Group, an investment management firm with USD$1.8 trillion in assets, argue we are in the late stages of an economic cycle and that this period should last anywhere from 1 to 3 years – US corporate earnings should grow in the range of 10% in CY2019 before decelerating in CY2020
  • The VIX is little changed this morning and is currently at 18.79 after closing at 19.07 yesterday
  • EEM December 2019 OTM Puts, February 15 SPY PUTs, and ECA April 2019 OTM Puts are some of the heavily traded options contracts in the US pre-market this morning
  • US 10-Year Treasury Bonds are higher with yields down -0.72 basis points to 2.6952%
  • The US Treasury 2s-10s Spread has narrowed 0.51 basis points to 0.16%
  • WTI Crude is currently up 1.1% to USD$51.07/bbl with the Brent-WTI spread up USD$2.11 to USD$8.88/bbl
  • NYMEX gasoline crack spreads, a measure of profitability for US refiners, is trading at lowest levels in 3 years with rising domestic stockpiles weigh downstream products prices
  • Gold is currently little changed -0.18% to USD$1289.39/oz

Stocks Trending in the News

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

  • Ablemarle (ALB) was downgraded today to neutral from buy at Nomura Instinet.  Ablemarle’s price target was lowered to USD$85 from USD$90.  Nomura Instinet is at the low end of consensus, with the average price target USD$113.50 for Ablemarle.  Ablemarle is rated is rated “Neutral” in our US Large-Cap Global Top Stock Ideas.
  • Bytedance is launching a new chat service in China to take on Tencent’s (TCEHY, SEHK: 700) WeChat.  The new service was launched today in a live-streamed event in Beijing and is called “Duoshan”.  Bytedance wants to grab some of the 1 billion users that WeChat presently has.  Tencent is rated “Attractive” in our China All-Cap Global Top Stock Ideas.
  • Boohoo Group (LSE: BOO) increased full-year guidance after a strong holiday season.  Boohoo as previously said revenue would rise 38-43%, now it has upped that to 43-45% growth.  Boohoo’s social media strategy has paid off handsomely.  Boohoo is rated “Attractive” in our United Kingdom All-Cap Global Top Stock Ideas.
  • Delta Airlines (DAL) reported 4Q EPS of USD$1.30, a touch above USD$1.28 expected.  For the coming quarter, Delta Airlines sees revenue growing 4-6% while expecting costs to grow below inflation.  Delta expects 1Q revenue of USD$10.4 billion, up 5% y/y.  For full-year 2019, Delta Airlines expects EPS of USD$6-7.  Delta Airlines is rated “Top Buy” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Industrials Global Top Stock Ideas.
  • Facebook (FB) said it is going to invest USD$300 million in local news over the next 3 years.  Facebook will offer grants to local newsrooms and invest in local news non-profits.  Facebook is making the efforts as local news programs continue to suffer.  Facebook is rated is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and is rated “Top Buy” in our US Information Technology Global Top Stock Ideas.
  • Glencore (LSE: GLEN) is being described as “Far, far too cheap” by Bernstein in a note.  Bernstein says the stock is trading at 4.8x EV/ebitda versus its historical average of 8.0x.  Bernstein reiterates it outperform rating at 500 pence price target.  Glencore is rated is rated “Neutral” in our European Large-Cap Global Top Stock Ideas and is rated “Neutral” in our United Kingdom All-Cap Global Top Stock Ideas.
  • JP Morgan (JPM) reported 4Q results that missed estimates, with fixed income trading revenue missing estimates significantly.  4Q EPS of USD$1.98 was well below USD$2.21 and came below the lowest estimate.  Fixed income trading revenue of USD$1.86 billion was well below USD$2.29 billion expected.  Equity sales and trading revenue of USD$1.32 billion was in-line.  JP Morgan reported USD$2 trillion in assets under management.  JP Morgan is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas.
  • United Healthcare (UNH) reported fourth quarter results that beat estimates.  Adjusted earnings came at USD$3.28, beating the USD$3.21 average consensus.  United Healthcare saw it medical care ratio decline 50 basis points to 81.6%.  United Healthcare maintained 2019 revenue guidance of USD$243-245 billion.  United Healthcare is rated is rated “Attractive” in our US Large-Cap Global Top Stock Ideas.
  • Zix Corp (ZIXI) has agreed to acquire AppRiver in an effort to create a cloud-based email security provider to small and medium-sized businesses.  Zix secured a total of USD$300 million in convertible financing to complete the deal.  The new combined company will have ~USD$180 million in revenue.  Zix is rated is rated “Attractive” in our US SMID-Cap Global Top Stock Ideas and is rated “Neutral” in our US Information Technology Global Top Stock Ideas.

 

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European Stocks

  • European stocks retrace early morning highs and turn negative following disappointing earnings from JP Morgan (JPM)
  • The Euro Stoxx 600 is currently up +0.18%, the FTSE 100 is higher by +0.2%, the DAX has advanced +0.1%, and the CAC 40 has risen +0.19%
  • German GDP Growth expanded 1.5% in CY2018, the slowest pace in 5 years and compares to 2.2% growth in CY2017
  • Investor sentiment for European stocks is positive with the advance/decline ratio for the Euro Stoxx 600 currently at 1.63x
  • Members of Parliament was expected to vote down UK Prime Minister Theresa May’s BREXIT plan later today (in the evening London time
  • Oil & Gas (0%), Telecommunications (-0.8%), and Basic Resources (+0.73%) stocks are the top performers in the Euro Stoxx 600 today
  • Automobiles & Parts (+0.66%), Food & Beverage (+0.06%), and Utilities (-0.1%) stocks are the worst performers in the Euro Stoxx 600 today
  • 50 stocks in the Euro Stoxx 600 are at 4-week highs while 26 stocks are at 4-week lows
  • 7 stocks in the Euro Stoxx 600 are overbought while 2 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 17.72 after closing at 17.9 yesterday
  • EUR€ is currently down -0.366% against the USD$ to 1.1427
  • GBP£ is currently little changed against the USD$ at 1.2845
  • CHF is currently down -0.579% against the USD$ to 1.0135
  • German 10-Year Bunds are higher with yields down -2.2 basis points to 0.209%
  • UK 10-Year GILTs are higher with yields down -2.2 basis points to 1.275%

Asian Stocks

  • Asia stocks closed higher in overnight trading following statements by Chinese officials that the Chinese government is considering tax cuts on a “large scale” to stimulate economic growth
  • The Nikkei 225 finished up +0.96%, the Hang Seng ended up +2.02%, the Hang Seng China Enterprise up +2.04%, and the CSI 300 was +1.96%
  • Investor sentiment for Japanese stocks finished positive with the advance/decline ratio for the Nikkei 225 closing at 3.25x
  • 27 stocks in the Nikkei 225 hit 4-week highs while 2 stocks reached 4-week lows
  • 1 stock in the Nikkei 225 closed overbought while 2 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 49x
  • 8 stocks in the Hang Seng hit 4-week highs while 1 stock reached 4-week lows
  • 2 stocks in the Hang Seng closed overbought while 1 stock closed oversold according to the 16-day RSI Measure
  • Japan 2-Year Government Bonds are higher with yields down -0.3 basis points to -0.151%
  • Japan 10-Year Government Bonds are higher with yields down -0.4 basis points to 0.013%
  • JGBs 2s-10s Spread has narrowed 0.1 basis points to 0.16%
  • JPY¥ is currently up +0.342% against the USD$ to 108.53

 

*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
Netflix Inc 86 1.57 -5 -11 -1.6% -2.0%
Goldman Sachs Group Inc/The 77 7.57 -17 -6 -10.09% -7.21%
Microsoft Corp 68 5.14 -3 29 0.25% 4.69%
Ford Motor Co 63 2.14 -3 -3 -4.09% 0.37%
Wells Fargo & Co 58 3.43 0 -11 -1.17% -1.62%

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
Goldman Sachs Group Inc/The 77 7.57 -17 -6 -10.09% -7.21%
PepsiCo Inc 21 7 -1 -1 -1.18% -1.49%
Union Pacific Corp 19 7 1 13 0.17% 4.4%
Occidental Petroleum Corp 24 6.71 -15 -1 -23.73% -34.34%
BlackRock Inc 9 5.43 -10 -7 -5.7% -9.93%

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 15.22 68.25% 16.82 80.36% 1.11 60.91% -14.83 0.4% -7.33 4.76%
QQQ 23.59 77.38% 22.65 83.73% 0.96 31.94% -13.51 1.98% -10.35 1.98%
IWM 20.77 78.97% 20.31 85.71% 0.98 33.13% -10.01 1.19% -6.28 1.19%
FEZ 17.33 69.25% 17.89 83.73% 1.03 59.72% -3.33 16.67% -1.73 19.44%
EEM 18.8 48.81% 20.2 61.51% 1.07 83.33% -1.24 40.48% -4.02 9.13%

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
LULULEMON ATHLETICA INC LULU Consumer Discretionary Textiles, Apparel & Luxury Goods 5.57% 4.11% 56.16%
NORTHROP GRUMMAN CORP NOC Industrials Aerospace & Defense 1.52% 3.97% -14.51%
EURONET WORLDWIDE INC EEFT Information Technology IT Services 1.24% 4.41% 21.94%
CULLEN/FROST BANKERS INC CFR Financials Banks 1.04% 2.47% 2.47%
HARRIS CORP HRS Industrials Aerospace & Defense 0.82% 3.13% -1.24%
 
Losers Ticker Sector Industry 1D Return 5D Return YTD
EXELIXIS INC EXEL Health Care Biotechnology -3.86% 4.29% -31.74%
ABBVIE INC ABBV Health Care Biotechnology -2.85% -5.15% -9.88%
LAMB WESTON HOLDINGS INC LW Consumer Staples Food Products -2.67% -4.21% 21.16%
DOLLAR GENERAL CORP DG Consumer Discretionary Multiline Retail -2.58% 0.14% 19.85%
TEXAS INSTRUMENTS INC TXN Information Technology Semiconductors & Semiconductor Equipment -2.32% 1.92% -6.63%

Source: S&P Capital IQ, StockDio

Top Short Winners and Losers

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Winners Ticker Sector Industry 1D Return 5D Return YTD
SUPERIOR ENERGY SERVICES INC SPN Energy Energy Equipment & Services -7.24% -3.94% -99.71%
MYRIAD GENETICS INC MYGN Health Care Biotechnology -4.53% 3.3% -18.82%
PIVOTAL SOFTWARE INC PVTL Information Technology Software -4.13% -5.88% 6.76%
ARRAY BIOPHARMA INC ARRY Health Care Biotechnology -3.68% -0.12% 23.09%
ANAPTYSBIO INC ANAB Health Care Biotechnology -3.63% 0.13% -36.96%
 
Losers Ticker Sector Industry 1D Return 5D Return YTD
ROWAN COMPANIES PLC RDC Energy Energy Equipment & Services 7.0% 9.22% -36.49%
UNITED NATURAL FOODS INC UNFI Consumer Staples Food & Staples Retailing 4.63% 12.96% -132.06%
THOR INDUSTRIES INC THO Consumer Discretionary Automobiles 4.07% 9.05% -89.51%
RANGE RESOURCES CORP RRC Energy Oil, Gas & Consumable Fuels 3.17% 6.44% -40.63%
GOODYEAR TIRE & RUBBER CO GT Consumer Discretionary Auto Components 2.69% 3.97% -36.86%

Source: S&P Capital IQ, StockDio

 

Cryptocurrencies Today

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

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

Events Calendar

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Company Name Ticker Event Date Event Type Q-Factor Score
JPMorgan Chase & Co. JPM 1/15/2019 Earnings Release Date US Large-Cap: D
Wells Fargo & Company WFC 1/15/2019 Earnings Release Date US Large-Cap: D
Synovus Financial Corp. SNV 1/15/2019 Earnings Release Date US Large-Cap: C
UnitedHealth Group Incorporated UNH 1/15/2019 Earnings Release Date US Large-Cap: B
First Republic Bank FRC 1/15/2019 Earnings Release Date US Large-Cap: A
Pinnacle Financial Partners, Inc. PNFP 1/15/2019 Earnings Release Date US Large-Cap: C
United Continental Holdings, Inc. UAL 1/15/2019 Earnings Release Date US Large-Cap: C, US Industrials: B
The Charles Schwab Corporation SCHW 1/15/2019 Estimated Earnings Release Date US Large-Cap: C
Kinder Morgan, Inc. KMI 1/15/2019 Estimated Earnings Release Date US Large-Cap: C
The Bank of New York Mellon Corporation BK 1/16/2019 Earnings Release Date US Large-Cap: D
Bank of America Corporation BAC 1/16/2019 Earnings Release Date US Large-Cap: C
BlackRock, Inc. BLK 1/16/2019 Earnings Release Date US Large-Cap: B
The PNC Financial Services Group, Inc. PNC 1/16/2019 Earnings Release Date US Large-Cap: C
U.S. Bancorp USB 1/16/2019 Earnings Release Date US Large-Cap: C
The Goldman Sachs Group, Inc. GS 1/16/2019 Earnings Release Date US Large-Cap: D
Comerica Incorporated CMA 1/16/2019 Earnings Release Date US Large-Cap: B
CSX Corporation CSX 1/16/2019 Earnings Release Date US Large-Cap: A, US Industrials: A
Alcoa Corporation AA 1/16/2019 Earnings Release Date US Large-Cap: D
Fastenal Company FAST 1/16/2019 Estimated Earnings Release Date US Large-Cap: C, US Industrials: B
Commerce Bancshares, Inc. CBSH 1/17/2019 Earnings Release Date US Large-Cap: C
Morgan Stanley MS 1/17/2019 Earnings Release Date US Large-Cap: D
BB&T Corporation BBT 1/17/2019 Earnings Release Date US Large-Cap: C
PPG Industries, Inc. PPG 1/17/2019 Earnings Release Date US Large-Cap: C
Signature Bank SBNY 1/17/2019 Earnings Release Date US Large-Cap: D
KeyCorp KEY 1/17/2019 Earnings Release Date US Large-Cap: C
MGIC Investment Corporation MTG 1/17/2019 Earnings Release Date US Large-Cap: C
M&T Bank Corporation MTB 1/17/2019 Earnings Release Date US Large-Cap: B
Netflix, Inc. NFLX 1/17/2019 Earnings Release Date US Large-Cap: D, US Consumer Discretionary: C
People's United Financial, Inc. PBCT 1/17/2019 Earnings Release Date US Large-Cap: D
J.B. Hunt Transport Services, Inc. JBHT 1/17/2019 Earnings Release Date US Large-Cap: B, US Industrials: A
Bank OZK OZK 1/17/2019 Earnings Release Date US Large-Cap: F
PacWest Bancorp PACW 1/17/2019 Estimated Earnings Release Date US Large-Cap: C
Regions Financial Corporation RF 1/17/2019 Earnings Release Date US Large-Cap: C

Source: S&P Capital IQ

 

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