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Morning Brief

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Morning Quant Ride

Jul 16, 2018

US Stocks                                                                                                                                                                 Start Your Free Trial Today

  • US stocks index futures are little changed this morning and point to neutral open in NY: Dow Jones minis +0.064%, S&P500 minis +0.036% and Nasdaq 100 minis +0.115%
  • The VIX is currently at 12.56 after closing last week at 12.18
  • SPY July 20 & October 2018 OTM Calls, Bank of America (BAC) July 20 OTM Calls are the most heavily traded options contracts in the US pre-market
  • The yield on the US 10-year government bond is little changed at 2.833%
  • The USD$ Index (DXY) is +0.26% with a strengthening EUR€ (+0.34% to 1.1724) and GBP£ (+0.49% to 1.3288) driving the sel-off in the greenback this AM
  • Global oil prices are negative this morning with WTI -1.65% to USD$69.83/bbl and Brent -2.06% to USD$73.79/bbl
  • Saudi Arabia has allegedly offered customers additional cargoes of Arab extra light crude to two buyers in Asia
  • US government is considering releasing supply from the Strategic Petroleum Reserve (SPR) to help offset the impact of lost Iranian supplies on global oil market
  • Smart Beta ETFs saw inflows were USD$1.31bn for the week ending July 13, 10x increase week over week with the majority of inflows going to US Small-caps

International Stocks

  • European stocks are mixed this morning as earnings results are overshadowing worries about a further escalation in Sino-US trade tensions: Euro Stoxx 600 -0.13%, FTSE 100 -0.74%, DAX +0.10%, and CAC 40 +0.11%
  • VSTOXX, the European stocks equivalent of the VIX, is at 13.17.89after finishing last week at 12.8035
  • Asian stocks finished their trading sessions little changed to negative with the CSI 300 -0.59%, HSI +0.05% and Hang Seng China Enterprise -0.39%
  • Japanese stocks were closed for Marine Day
  • CNY is reversed last week’s weakening to start of the week with a +0.24%  to 6.6756 move this AM
  • Global sovereign bonds are little changed this AM 10-year yields on Eurozone country government debt up 1 to 2 basis points
  • Singapore 10-year yields down 4.1 basis points to 2.396% following weaker than expected new home sales

Cryptos

  • Swiss Infrastructure & Exchange (SIX) Group, parent company of Switzerland’s principal stock exchange announced it is open to the possibility of offering cryptocurrency trading services on its digital trading platform during an interview with Swissinfo.  SIX would like to launch a fully-regulated digital trading platform by mid-2019
  • South African financial services provider, Purple Group, has added Bitcoin and Ethereum to its online trading platform GT247.com.  Despite the recent sell-off in cryptocurrencies, Purple Group has seen significant interest in the ability to trade digital currencies on its platform from retail clients
  • Peter Wuille, a well-known Bitcoin developer, released the technical framework of Schnorr.  If implemented, Schnorr would be the most significant change to the Bitcoin blockchain since SegWit.  Schnor is a digital signature and would give users of bitcoin a new way to generate the cryptographic keys used to store and send bitcoin. Schnorr introduce several new benefits, including privacy and scalability – two of the biggest challenges facing Bitcoin’s mass adoption.

*Data in Price Return; Source: Stockdio

S&P 500 Sector Performance

*Data in Total Return; Source: S&P Capital IQ

Conviction Buy Laggards From Friday We Are Watching Today

Click name for Q-Factor rating and financial data.

Advanced Energy Industries, Inc. - 37.75% off its 52wkH on 10/30/2017, reports earnings on 08/01/2018

Broadcom Inc. - 25.51% off its 52wkH on 01/00/1900, reports earnings on 09/06/2018

Electro Scientific Industries, Inc. - 37.77% off its 52wkH on 11/27/2017, reports earnings on 08/01/2018

Ichor Holdings, Ltd. - 41.96% off its 52wkH on 10/20/2017, reports earnings on 08/07/2018

MCBC Holdings, Inc. - 9.79% off its 52wkH on 05/18/2018, reports earnings on 09/07/2018

SMART Global Holdings, Inc. - 46.23% off its 52wkH on 01/00/1900, reports earnings on 09/28/2018

Stocks Trending in the News

Click name for Q-Factor rating and financial data.

Airbus SE (ENXTPA:AIR) is reportedly close to reaching deals, collectively worth $29 billion, with several Asian carriers that are expanding their fleets. The larges of these deals is a potential sale of $23 billion worth of aircraft to AirAsia Group

Alphabet Inc (GOOGL) subsidiary Google is expected to receive a significant fine from EU antitrust regulators later this week. Google is accused of abusing its significant market position and shutting competitors out from its search services. The penalty may top last year’s $2.8 billion fine, which was a record for EU antitrust regulators

Arconic (ARNC) shares are up 9.32% to $19.00 pre-market, following reports that the company may receive a takeover bid from Apollo Global Management, along with other interested firms

Bank of America (BAC) reported 2Q2018 EPS that was higher than expected ($0.63 vs $0.57 estimated). Shares of Bank of America are up 0.70% to $28.75 pre-market

BlackRock Inc (BLK) posted 2Q2018 EPS that was above the consensus ($6.66 vs $6.55 forecasted). BlackRock Inc shares are flat before the open

Boeing Co (BA) has agreed to a $4.7 billion deal with DHL under which Boeing will provide freight aircraft. Boeing’s shares are unchanged before today’s trading

Deutsche Bank (DB:DBK) provided a 2Q2018 earnings preview that projected revenue to be $6.6 billion for the quarter, compared to expectations of $6.39 billion in revenue

FedEx (FDX) has been downgraded from buy to a neutral rating at UBS. FedEx stock is 0.34% lower to $232.95 before today’s open

Funko Inc (FNKO) has been downgraded to neutral from a buy rating at Goldman Sachs. Funko shares are down 2.86% to $15.65 pre-market

Goldman Sachs (GS) is expected to name its president, David Solomon, as the company’s next CEO later this week. Solomon will be replacing Lloyd Blankfein, who is one of the company’s longest-serving CEOs

Lockheed Martin (LMT) has agreed to a “handshake deal”, worth more than $12 billion, with the US Department of Defense. Under the agreement, Lockheed will produce 141 F-35 combat jets

UPS (UPS) has been upgraded from neutral to a buy rating at UBS. UPS is 0.95% higher to $110.00 before trading today

Wells Fargo (WFC) is up 0.34% to $55.00 pre-market, after the company was upgraded from market perform to outperform at Keefe, Bruyette & Wodds

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
Burlington Stores, Inc. BURL Consumer Discretionary Apparel Retail 2.14% 0.01% 22.86%
Allison Transmission Holdings, Inc. ALSN Industrials Construction Machinery and Heavy Trucks 2.07% 3.49% -2.90%
US Foods Holding Corp. USFD Consumer Staples Food Distributors 1.86% 3.82% 24.99%
Church & Dwight Co., Inc. CHD Consumer Staples Household Products 1.75% 2.25% 11.40%
Micron Technology, Inc. MU Information Technology Semiconductors 1.62% 5.86% 37.04%
Losers Ticker Sector Industry 1 Day Return 5 Day Return  YTD
Broadridge Financial Solutions, Inc. BR Information Technology Data Processing and Outsourced Services -1.20% 1.18% 2.49%
Jack Henry & Associates, Inc. JKHY Information Technology Data Processing and Outsourced Services -1.15% 1.29% 3.85%
Louisiana-Pacific Corporation LPX Materials Forest Products -1.11% -1.18% 1.47%
Fortinet, Inc. FTNT Information Technology Systems Software -0.91% 2.22% 6.01%
Total System Services, Inc. TSS Information Technology Data Processing and Outsourced Services -0.99% 4.77% 6.81%

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
GreenSky, Inc. GSKY Information Technology Data Processing and Outsourced Services -5.12% -9.78% -8.89%
Geron Corporation GERN Healthcare Biotechnology -4.70% -3.27% 5.23%
Spark Therapeutics, Inc. ONCE Healthcare Biotechnology -4.82% -8.03% 2.67%
Ellie Mae, Inc. ELLI Information Technology Application Software -3.73% -3.41% -0.96%
Sanderson Farms, Inc. SAFM Consumer Staples Packaged Foods and Meats -3.61% -5.25% -2.43%
Losers Ticker Sector Industry 1 Day Return 5 Day Return  YTD
Diamond Offshore Drilling, Inc. DO Energy Oil and Gas Drilling 2.65% 3.80% 10.27%
Oceaneering International, Inc. OII Energy Oil and Gas Equipment and Services 2.61% 0.04% 24.65%
Immunomedics, Inc. IMMU Healthcare Biotechnology 2.61% 5.70% 58.29%
Rowan Companies plc RDC Energy Oil and Gas Drilling 2.50% 5.82% 4.53%
Overstock.com, Inc. OSTK Consumer Discretionary Internet and Direct Marketing Retail 2.10% 5.57% -39.20%

Source: S&P Capital IQ

Events Calendar

On Mobile/Tablet scroll to the right

Company Name Ticker Event Date Event Type Q-Factor Score
PacWest Bancorp PACW 7/15/2018 Estimated Earnings Release Date US Large-Cap: B
The Charles Schwab Corporation SCHW 7/15/2018 Estimated Earnings Release Date US Large-Cap: C
Bank of America Corporation BAC 7/16/2018 Earnings Release Date US Large-Cap: C
BlackRock, Inc. BLK 7/16/2018 Earnings Release Date US Large-Cap: A
Netflix, Inc. NFLX 7/16/2018 Earnings Release Date US Large-Cap: C, US Consumer Discretionary: B
The Progressive Corporation PGR 7/16/2018 Estimated Earnings Release Date US Large-Cap: A
J.B. Hunt Transport Services, Inc. JBHT 7/16/2018 Estimated Earnings Release Date US Large-Cap: B, US Industrials: A
Johnson & Johnson JNJ 7/16/2018 Estimated Earnings Release Date US Large-Cap: C
Altaba Inc. AABA 7/16/2018 Estimated Earnings Release Date US Large-Cap: A, US Information Technology: B
Prologis, Inc. PLD 7/16/2018 Earnings Release Date US Large-Cap: C
United Continental Holdings, Inc. UAL 7/16/2018 Earnings Release Date US Large-Cap: D, US Industrials: C
Comerica Incorporated CMA 7/17/2018 Earnings Release Date US Large-Cap: A
Omnicom Group Inc. OMC 7/17/2018 Earnings Release Date US Large-Cap: B, US Consumer Discretionary: B
UnitedHealth Group Incorporated UNH 7/17/2018 Earnings Release Date US Large-Cap: A
First Horizon National Corporation FHN 7/17/2018 Earnings Release Date US Large-Cap: C
The Goldman Sachs Group, Inc. GS 7/17/2018 Earnings Release Date US Large-Cap: C
Interactive Brokers Group, Inc. IBKR 7/17/2018 Earnings Release Date US Large-Cap: C
CSX Corporation CSX 7/17/2018 Earnings Release Date US Large-Cap: B, US Industrials: C
Hancock Whitney Corporation HBHC 7/17/2018 Earnings Release Date US Large-Cap: A
Fidelity National Financial, Inc. FNF 7/17/2018 Earnings Release Date US Large-Cap: C
Pinnacle Financial Partners, Inc. PNFP 7/17/2018 Earnings Release Date US Large-Cap: C
Mellanox Technologies, Ltd. MLNX 7/17/2018 Earnings Release Date US Large-Cap: C, US Information Technology: C
Wintrust Financial Corporation WTFC 7/17/2018 Earnings Release Date US Large-Cap: B
eBay Inc. EBAY 7/17/2018 Estimated Earnings Release Date US Large-Cap: C, US Information Technology: B
Kinder Morgan, Inc. KMI 7/17/2018 Estimated Earnings Release Date US Large-Cap: B
Umpqua Holdings Corporation UMPQ 7/17/2018 Earnings Release Date US Large-Cap: C
SL Green Realty Corp. SLG 7/17/2018 Earnings Release Date US Large-Cap: C
Morgan Stanley MS 7/18/2018 Earnings Release Date US Large-Cap: C
W.W. Grainger, Inc. GWW 7/18/2018 Earnings Release Date US Large-Cap: C, US Industrials: C
Textron Inc. TXT 7/18/2018 Earnings Release Date US Large-Cap: B, US Industrials: C
MGIC Investment Corporation MTG 7/18/2018 Earnings Release Date US Large-Cap: B
Abbott Laboratories ABT 7/18/2018 Earnings Release Date US Large-Cap: C
U.S. Bancorp USB 7/18/2018 Earnings Release Date US Large-Cap: B
M&T Bank Corporation MTB 7/18/2018 Earnings Release Date US Large-Cap: A
Northern Trust Corporation NTRS 7/18/2018 Earnings Release Date US Large-Cap: B
Texas Capital Bancshares, Inc. TCBI 7/18/2018 Earnings Release Date US Large-Cap: D
International Business Machines Corporation IBM 7/18/2018 Earnings Release Date US Large-Cap: C, US Information Technology: A
PTC Inc. PTC 7/18/2018 Earnings Release Date US Large-Cap: C, US Information Technology: C
Alcoa Corporation AA 7/18/2018 Earnings Release Date US Large-Cap: C
Crown Castle International Corp. (REIT) CCI 7/18/2018 Earnings Release Date US Large-Cap: D
United Rentals, Inc. URI 7/18/2018 Earnings Release Date US Large-Cap: B, US Industrials: A
Crown Holdings, Inc. CCK 7/18/2018 Earnings Release Date US Large-Cap: C
Vinda International Holdings Limited SEHK:3331 7/18/2018 Earnings Release Date China All-Cap: C
Alliance Data Systems Corporation ADS 7/18/2018 Estimated Earnings Release Date US Large-Cap: B, US Information Technology: A
Intuitive Surgical, Inc. ISRG 7/18/2018 Estimated Earnings Release Date US Large-Cap: B
Signature Bank SBNY 7/18/2018 Estimated Earnings Release Date US Large-Cap: C
Sarepta Therapeutics, Inc. SRPT 7/18/2018 Estimated Earnings Release Date US Large-Cap: D
T-Mobile US, Inc. TMUS 7/18/2018 Estimated Earnings Release Date US Large-Cap: B
Philip Morris International Inc. PM 7/18/2018 Earnings Release Date US Large-Cap: C, US Consumer Staples: C
Union Pacific Corporation UNP 7/18/2018 Earnings Release Date US Large-Cap: B, US Industrials: C