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Xi calls for "A new Long March" as tension grow with US; markets await Fed minutes for clues on rate cuts

May 22, 2019

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Market data as of 7am EST

US Stocks Preview Ahead of the Open

Stocks Trending in the News

 

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

Global Consumer Stocks Trending in the News

  • Advanced Auto Parts (AAP) reported first quarter adjusted EPS that beat consensus.  Advanced Auto Parts reported first quarter adjusted EPS of $2.46 beating consensus of $2.37.  First quarter revenue came in line at $2.95 billion.  Advanced Auto Parts saw same store sales growth of 2.7% in the first quarter, trailing consensus of 2.9% growth.  Advanced Auto Parts gave full year revenue guidance of $9.65 billion to $9.8 billion.  Advanced Auto Parts is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Discretionary Global Top Stock Ideas.  
  • Avon Products (AVP) is close to a sale to Brazil’s Natura (NATU3), WSJ is reporting.  The boards of both companies have approved the deal that has been prepared over the past months.  The deal would mark the end of Avon’s independence, one of America’s best known companies over the past decades.  Avon has seen sales suffering and the deal is its best survival option.  Avon Products is not rated in our Global Top Stock Ideas.  Natura is rated “Attractive” in our Brazil All-Cap Global Top Stock Ideas.
  • Ford (F) hopes to be testing delivery robots being deployed from self-driving cars within the next year.  Ford is partnering with robotic start-up Agility Robots developing walking robots that can deliver packages to homes.  The companies will run a test program with Agilent’s robots and Ford vans.  The program is part of Ford’s push into autonomous vehicles.  Ford is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Discretionary Global Top Stock Ideas.  
  • Harley-Davidson (HOG) is starting to use loans to drive sales, a more aggressive move for Harley.  Harley will introduce about 100 new models by 2027 and will use loans to drive sales to new customers it anticipates will be younger and less well-off than its stable of aging customers.  The risk for Harley is an uptick in delinquencies that could hamper results.  Harley-Davidson is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Consumer Discretionary Global Top Stock Ideas.  
  • Lowes (LOW) cut guidance, raising doubts about its turnaround efforts.  Lowes cut full-year EPS guidance to $5.54 to $5.74, down from previous $6.00 to $6.10.  Lowes said, “The consumer is healthy” and that its plan is in its early stages.  Lowes anticipates cutting next years earnings guidance too.  Lowes is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Consumer Discretionary Global Top Stock Ideas.  
  • Nike (NKE) has called the recently enacted tariffs on Chinese imports “catastrophic” in an open letter to President Trump.  Tariffs on footwear would be part of the next round of tariffs and Nike with 173 other companies pleaded with the President to not act further.  There is much less production of shoes in China than was the case a few years ago, but the companies argue it would still be terrible if fully implemented.  Nike is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Consumer Discretionary Global Top Stock Ideas.
  • Target (TGT) reported first quarter same store sales, revenue and earnings that beat consensus.   Target reported first quarter same store sales growth of 4.8%, topping consensus of 4.3%.  First quarter revenue of $17.63 billion beat $17.43 billion consensus.  First quarter adjusted EPS of $1.53 beat consensus of $1.43.  Target provided second quarter EPS guidance of $1.52 to $1.72.  Target sees second quarter same store sales growth in the low- to mid-single digits.  Target is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Consumer Discretionary Global Top Stock Ideas.   

Global Information Technology Stocks Trending in the News

  • Facebook (FB) should hire a new CEO and get rid of stock compensation, according to its ex-chief security officer, Alex Stamos.  Facebook has too much power, he argues, and the company should be broken into pieces to limit its power.  Stamos adds that a breakup would not fix Facebook’s broken culture which he sees at the root cause of most of its problems.  Facebook is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Information Technology Global Top Stock Ideas
  • Qualcomm (QCOM) violated anti-trust law with its business practices, a federal judge has ruled.  Qualcomm used its dominant market position to charge excessive licensing fees.  “Qualcomm’s practices have strangled competition,” the judge wrote in a ruling that agreed with FTC findings.  Qualcomm charges a percentage of the sale price of the phone, a practice the judge found excessive.  Qualcomm is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Information Technology Global Top Stock Ideas

Global Industrials Stocks Trending in the News

  • Boeing’s (BA) 737 Max crash involving Ethiopian Airlines was likely caused by a bird strike to a suspected sensor, WSJ reports.  The sensor in the Boeing 737 Max in question, part of the MCAS system, does not have a back-up source of information in the event there is a problem with it.  The addition of a back-up is part of the modifications Boeing is testing.  Boeing is rated “Top Short” in our US Large-Cap Global Top Stock Ideas and “Unattractive” in our US Industrials Global Top Stock Ideas.  

Global Financial Stocks Trending in the News

  • China CITIC Bank (SEHK:998) and Baidu (BIDU) are seeking up to 7 billion yuan in private funding in its first round of funding for its digital bank, aiBank.  China CITIC and Baidu launched the online bank in 2015 and are seeking funding to drive growth.  aiBank provides personal loans of up to 300,000 yuan with no collateral.   China CITIC Bank is rated “Neutral” in our China All-Cap Global Top Stock Ideas.
  • Commerzbank’s (DB:CBK) CEO indicated the bank may be open to a merger with another bank after its attempts at a tie-up with Deutsche Bank (DB:DBK) collapsed.  Commerzbank will unveil a new plan for strategy plan in the fall but its CEO made clear one option is a merger with another German or European bank.   A number of other European bank have shown interest so that option exists if management thinks it makes sense.  Commerzbank is rated “Unattractive” in our European Large-Cap Global Top Stock Ideas.  Deutsche Bank is rated “Neutral” in our European Large-Cap Global Top Stock Ideas.

 

 

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International Stock Markets Recaps

  • The Euro Stoxx 600 is currently up +0.1%, the FTSE 100 is higher by +0.48%, the DAX has risen +0.39%, and the CAC 40 is up +0.17%
  • Technology (+0.65%), Insurance (-0.6%), and Basic Resources (+0.01%) stocks are the top performers in the Euro Stoxx 600 today
  • Telecommunications (-0.31%), Travel & Leisure (-0.69%), and Health Care (+0.22%) stocks are the worst performers in the Euro Stoxx 600 today
  • Investor sentiment for European stocks is positive with the advance/decline ratio for the Euro Stoxx 600 currently at 1.61x
  • 50 stocks in the Euro Stoxx 600 are at 4-week highs while 51 stocks are at 4-week lows
  • 25 stocks in the Euro Stoxx 600 are overbought while 30 stocks are oversold according to the 16-day RSI Measure
  • The Nikkei 225 finished up +0.05%, the Hang Seng ended up +0.18%, the Hang Seng China Enterprise declined -0.28%, and the CSI 300 was -0.47%
  • Investor sentiment for Japanese stocks finished negative with the advance/decline ratio for the Nikkei 225 closing at 0.84x
  • 26 stocks in the Nikkei 225 hit 4-week highs while 52 stocks reached 4-week lows
  • 8 stocks in the Nikkei 225 closed overbought while 44 stocks closed oversold according to the 16-day RSI Measure
  • Investor sentiment for Hong Kong stocks finished neutral with the advance/decline ratio for the Hang Seng closing at 1.08x
  • 4 stocks in the Hang Seng hit 4-week highs while 20 stocks reached 4-week lows
  • 0 stocks in the Hang Seng closed overbought while 10 stocks closed oversold according to the 16-day RSI Measure

 

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

 

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