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Morning Brief

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Morning Quant Ride

Jun 12, 2018

US Stocks                                                                                                                                                              Start your free trial today

  • Global stocks appear to be shrugging off the Trump-Kim summit as investors shift their focus to the US FOMC decision on Wednesday, the European Central Bank (ECB) decision on Thursday and the Bank of Japan (BOJ) policy decision on Friday
  • US equity index futures are declining this morning with the Dow Jones minis -0.17%, S&P500 minis -0.11% and Nasdaq 100 minis -0.11% -- trading near their pre-market low today
  • This morning’s May CPI release will be closely followed as investors speculate about the “hawkishness” of US Fed policy in the coming months
  • The VIX remains relatively muted at 12.47 up from yesterday’s close of 12.35
  • SPY June 15 OTM Calls, Weatherford International (WFT ) June 15 OTM Puts, EEM June 15 OTM Puts, EEM July 20 OTM Calls and QQQ January 18 OTM Puts are the most heavily traded options contracts in the US pre-market this AM
  • The yield on the US 10-year government bond is little changed at 2.966%
  • The USD$ Index is flat with only the JPY¥ -0.22% and ZAR -0.22% the notable movers among major currencies

Global Stocks 

  • European stocks are little changed with a negative bias ahead of the NY open with the Euro Stoxx 600 +0.06%, FTSE 100 -0.27%, CAC 40 -0.22% and DAX +0.02%
  • The ECB decision this Thursday for interest rates (and its quantitative easing policy) is driving investor sentiment in Europe this AM
  • Commerzbank stock strategists see European stocks outperforming their US counterparts in 2H2018
  • The VSTOXX, the European stock equivalent of the VIX, is down to 13.9055 after trading through 16 on Friday
  • Italian 10-year sovereign yields are down 3.1 basis points to 2.791%
  • Asia stocks failed to react to the conclusion of the Trump-Kim summit with the Nikkei 225 +0.33%, Hang Seng +0.13%, Hang Seng China Enterprise +0.28%
  • The Kospi closed down 0.05% as investors reaction to the Trump-Kim summit was tepid with limited details about the next steps

Cryptos

  • Sequoia Capital, an early investor into Bitmain, led a USD$400mm Pre-IPO funding round which gives Bitmain a valuation of USD$12bn according to insider reports. The firm recently reported that it is planning to go public this year, most likely in September. Bitmain is in control of the two largest mining pools, BTC.com and Antpool. These two pools account for more than 40% of the world’s bitcoin mining power
  • Coinbase announced that it will be adding Ethereum Classic (ETC) to its platform in the coming months. Ethereum Classic’s price jumped over 20% following this news. ETC recently overcame the Difficulty bomb which was formerly present on the blockchain
  • A national banking group in South Korea will be releasing its blockchain-based ID verification system, BankSign, for domestic commercial banks. The application is built on Nexledger, a private blockchain platform created by Samsung’s enterprise solution division
  • Major cryptocurrencies are mixed this morning from last night’s UTC close. Quantamize AI Machine Learning 3-Day Crypto Signals are on day two of their rolling 3-Day forecast. Of the thirty cryptocurrencies we model, six have a Buy Signal

*Data in Price Return, Source: Stockdio

S&P 500 Sector Performance

*Data in Total Return as of Previous Day's EOD, Source: S&P Capital IQ

Conviction Buy Laggards From Yesterday We Are Watching Today

Click name for Q-Factor rating and financial data.

Applied Materials, Inc. - 20.05% off its 52wkH on 03/12/2018, reports earnings on 08/16/2018

Broadridge Financial Solutions, Inc. - 2.23% off its 52wkH on 06/08/2018, reports earnings on 08/07/2018

Dunkin' Brands Group, Inc. - 2.00% off its 52wkH on 01/25/2018, reports earnings on 07/25/2018

DXC Technology Company - 21.28% off its 52wkH on 03/20/2018, reports earnings on 08/09/2018

MCBC Holdings, Inc. - 3.68% off its 52wkH on 05/18/2018, reports earnings on 09/07/2018

Stocks Trending in the News

Click name for Q-Factor rating and financial data.

A court ruling is expected today regarding AT&T’s (T) potential $85 billion acquisition of Time Warner Inc (TWX). The US Department of Justice has attempted to block the deal over antitrust concerns.

Citigroup (C) has indicated that it may reduce the size of its technology and operation staff, which currently employs 20,000, by 50% over the next 5 years.

Eli Lilly & Co. (LLY) and AstraZeneca PLC (LSE:AZN) announced that they will be halting clinical trials of its lanabecestat drug, intended to combat the effects of Alzheimer’s.

Home Depot (HD) reportedly plans to spend $1.2 billion over the next 5 years on improving its online shopping capabilities. The company will add 170 distribution centers nationally, allowing it to reach 90% of the US population.

Lands’ End Inc (LE) reported 1Q2018 EPS that was better than expected (-$0.08 vs -$0.17 projected). Lands’ End’s stock is up 6.38% before the open to $25.00 per share.

McDonald’s (MCD) is expected to announce changes to its organizational structure in the US today, with one of the changes being the promise of more corporate support for franchisees.

SeaWorld (SEAS) is down 1.43% to $20.71 pre-market after the company was downgraded from neutral to a sell rating at Citi Group.

Targa Resources (TRGP) was downgraded to equal-weight from an overweight rating at Barclays. Shares of Targa are trading 1.26% lower to $50.00 before the open.

Twitter Inc (TWTR) stock is up 2.00% to $42.25 per share pre-market, after JP Morgan raised its price target for Twitter from $39 to $50.

Cryptocurrencies Today

Source: Stockdio

Stock Movers

Conviction Buy Winners and Losers

On Mobile/Tablet Scroll to the right.

Winners  Ticker Sector Industry 1 Day Return 5 Day Return  YTD
The J. M. Smucker Company SJM Consumer Staples Packaged Foods and Meats 3.56% -0.33% -14.54%
Ollie's Bargain Outlet Holdings, Inc. OLLI Consumer Discretionary General Merchandise Stores 2.35% -0.87% 39.25%
Monolithic Power Systems, Inc. MPWR Information Technology Semiconductors 2.29% 0.11% 22.23%
Cigna Corporation CI Healthcare Managed Healthcare 1.77% 3.44% -10.90%
Anthem, Inc. ANTM Healthcare Managed Healthcare 1.77% 1.96% 3.25%

 

Losers Ticker Sector Industry 1 Day Return 5 Day Return  YTD
Lam Research Corporation LRCX Information Technology Semiconductor Equipment -2.30% -7.97% -7.30%
American Electric Power Company, Inc. AEP Utilities Electric Utilities -1.84% -1.38% -7.39%
Broadridge Financial Solutions, Inc. BR Information Technology Data Processing and Outsourced Services -1.74% -1.93% 1.62%
Westlake Chemical Corporation WLK Materials Commodity Chemicals -1.41% -2.42% 0.09%
WEC Energy Group, Inc. WEC Utilities Multi-Utilities -1.45% -1.25% -7.21%

Source: S&P Capital IQ

Conviction Short Winners and Losers

On Mobile/Tablet Scroll to the right.

Winners Ticker Sector Industry 1 Day Return 5 Day Return  YTD
Editas Medicine, Inc. EDIT Healthcare Biotechnology -7.80% -5.44% -5.66%
Applied Optoelectronics, Inc. AAOI Information Technology Communications Equipment -5.91% -4.92% -8.57%
Sangamo Therapeutics, Inc. SGMO Healthcare Biotechnology -5.15% -5.44% -4.86%
ImmunoGen, Inc. IMGN Healthcare Biotechnology -4.85% -16.42% -16.93%
Etsy, Inc. ETSY Information Technology Internet Software and Services -3.61% -4.27% -0.90%

 

Losers Ticker Sector Industry 1 Day Return 5 Day Return  YTD
Pluralsight, Inc. PS Information Technology Application Software 7.39% 10.83% 0.00%
Roku, Inc. ROKU Consumer Discretionary Consumer Electronics 5.66% 5.10% -19.93%
Apache Corporation APA Energy Oil and Gas Exploration and Production 5.59% 12.68% 5.64%
Blueprint Medicines Corporation BPMC Healthcare Biotechnology 5.17% -1.44% -6.74%
Southwestern Energy Company SWN Energy Oil and Gas Exploration and Production 4.92% 8.94% -8.24%

Source: S&P Capital IQ

Events Calendar

On Mobile/Tablet Scroll to the right.

Company Name Ticker Event Date Event Type Q-Factor Score
H&R Block, Inc. HRB 6/12/2018 Earnings Release Date US Large-Cap: C, US Consumer Discretionary: C
AviChina Industry & Technology Company Limited SEHK:2357 6/12/2018 Estimated Earnings Release Date China All-Cap: C
Lonking Holdings Limited SEHK:3339 6/12/2018 Estimated Earnings Release Date China All-Cap: A
Fosun International Limited SEHK:656 6/12/2018 Estimated Earnings Release Date China All-Cap: C
Shandong Weigao Group Medical Polymer Company Limited SEHK:1066 6/12/2018 Estimated Earnings Release Date China All-Cap: C
Link Motion Inc. LKM 6/12/2018 Estimated Earnings Release Date China All-Cap: F
The Progressive Corporation PGR 6/12/2018 Earnings Release Date US Large-Cap: A
Yixin Group Limited SEHK:2858 6/12/2018 Earnings Release Date China All-Cap: F
Bitauto Holdings Limited BITA 6/13/2018 Earnings Release Date China All-Cap: F
China Shenghai Food Holdings Company Limited SEHK:1676 6/13/2018 Estimated Earnings Release Date China All-Cap: C
China Mengniu Dairy Company Limited SEHK:2319 6/13/2018 Estimated Earnings Release Date China All-Cap: B
China Agri-Industries Holdings Limited SEHK:606 6/13/2018 Estimated Earnings Release Date China All-Cap: D
China High Speed Transmission Equipment Group Co., Ltd. SEHK:658 6/13/2018 Estimated Earnings Release Date China All-Cap: D
China Education Group Holdings Limited SEHK:839 6/13/2018 Estimated Earnings Release Date China All-Cap: D
Summit Ascent Holdings Limited SEHK:102 6/13/2018 Estimated Earnings Release Date China All-Cap: D
iShares Asia Trust - iShares MSCI China Index ETF SEHK:2801 6/13/2018 Estimated Earnings Release Date China All-Cap: B
Adobe Systems Incorporated ADBE 6/13/2018 Estimated Earnings Release Date US Large-Cap: B, US Information Technology: C
Global Brands Group Holding Limited SEHK:787 6/13/2018 Estimated Earnings Release Date China All-Cap: D
Gold-Finance Holdings Limited SEHK:1462 6/13/2018 Earnings Release Date China All-Cap: C
The Michaels Companies, Inc. MIK 6/14/2018 Earnings Release Date US Large-Cap: C, US Consumer Discretionary: D
Jabil Inc. JBL 6/14/2018 Earnings Release Date US Large-Cap: C, US Information Technology: A
Finisar Corporation FNSR 6/14/2018 Earnings Release Date US Large-Cap: F, US Information Technology: D
CMBC Capital Holdings Limited SEHK:1141 6/14/2018 Estimated Earnings Release Date China All-Cap: D
China Merchants Port Holdings Company Limited SEHK:144 6/14/2018 Estimated Earnings Release Date China All-Cap: C
Sunac China Holdings Limited SEHK:1918 6/14/2018 Estimated Earnings Release Date China All-Cap: B
Hopson Development Holdings Limited SEHK:754 6/14/2018 Estimated Earnings Release Date China All-Cap: C
KB Home KBH 6/14/2018 Estimated Earnings Release Date US Large-Cap: D, US Consumer Discretionary: D
Lennar Corporation LEN 6/14/2018 Estimated Earnings Release Date US Large-Cap: D, US Consumer Discretionary: D
The 13 Holdings Limited SEHK:577 6/14/2018 Estimated Earnings Release Date China All-Cap: F
Vitasoy International Holdings Limited SEHK:345 6/14/2018 Earnings Release Date China All-Cap: A