morning-quant-ride

Morning Brief

Wake up to the Morning Quant Ride, your global markets update every morning!

Morning Quant Ride

Jul 18, 2018

US Stocks

  • Global stocks are advancing this morning following positive comment by US Federal Reserve Chairman Jerome Powell about the US economy during testimony to the US Senate Banking Panel yesterday. Market focus is shifting to S&P 500 earnings results
  • US stocks index futures are pointing to a neutral open in NY with the Dow Jones minis +0.04%, S&P500 minis +0.01% and Nasdaq 100 minis -0.09%
  • Morgan Stanley (MS) is up 3.5% pre-market following the release of its 2Q results which highlights Sales and Trading revenues that were well ahead of estimates
  • The VIX is down to 12.05 , the lowest level in over a month
  • Bank of America (BAC) July 20 OTM Calls, XLF August 17 OTM Calls, SPY 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 2.851%
  • The USD$ Index (DXY) is +0.30% with the EUR (-0.37% to 1.1619) and GBP£ (-0.65% to 1.3059) selling off against the Greenback this morning

International Stocks

  • European stocks are advancing this AM on the back of Fed Chairman Powell’s comments yesterday with the Euro Stoxx 600 +0.50%, FTSE 100 +0.53%, DAX +0.64%, and CAC 40 +0.46%
  • Tech stocks are leading the positive move in European stocks following ASML (ENXTAM:ASML) 2Q results which beat forecasts.  ASML should be considered a bell-weather for US large-cap semiconductors stocks like Applied Materials (AMAT), Lam Research (LRCX) and Nividia (NVDA)
  • VSTOXX, the European stocks equivalent of the VIX, is currently sitting at 12.0377 reaching as high as 13.6941 yesterday
  • Asian stocks finished their trading sessions positive as worries about the impact of a global trade war were overshadowed following Fed Chairman Powell’s positive comments about the US economy with the Nikkei 225 +0.43%, CSI 300 -0.52%, HSI -0.23% and Hang Seng China Enterprise -0.13%
  • Global sovereign bonds are little changed this AM 10-year yields on Eurozone country government debt down little less than 1 basis points
  • UK 10-year GILT yields are down 5 basis points to 1.207% on speculation that the Bank of England will not be able to raise rates in August following benign inflation data
  • Aussie 10-year yields are down 2.3 basis points to 2.632% following Fed Chairman Powell’s comments yesterday that are being interpreted as supportive for further rate hikes

Cryptos

  • Major cryptocurrencies are rallying today, with Bitcoin +11.11% to USD$7,413.40, Ethereum +4.61% to USD$497.92, XRP +7.97% to USD$0.5133, and Bitcoin Cash +9.19% to USD$868.55
  • Two Congressional committees will holding hearings on cryptocurrencies tomorrow.  House Committee of Agriculture will focus on the emergence of digital assets while Financial Policy Subcommittee will examine whether the United States should consider cryptocurrencies as money
  • Mastercard was awarded a patent Tuesday for a methodology that will speed up cryptocurrency payments.  In an attempt to reduce transaction times, Mastercard will offer a user account able to transact in cryptocurrencies through existing systems for fiat currencies. This account would link a series of profiles able to identify a user's "fiat currency amount, a blockchain currency amount, an account identifier and an address.”  The transactions will use fiat currency's payment rails and security features, but each transaction would represent a cryptocurrency
  • Coinbase retracted its statement yesterday that it had received regulatory approval to list security tokens  

*Data in Price Return; Source: Stockdio

S&P 500 Sector Performance

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

Conviction Buy Laggards From Yesterday We Are Watching Today

Click name for Q-Factor rating and financial data.

CA, Inc. - 0.25% off its 52wkH on 07/12/2018, reports earnings on 07/24/2018

Cigna Corporation - 24.84% off its 52wkH on 01/29/2018, reports earnings on 08/02/2018

Intel Corporation - 10.16% off its 52wkH on 06/04/2018, reports earnings on 07/26/2018

Laboratory Corporation of America Holdings - 2.89% off its 52wkH on 06/11/2018, reports earnings on 07/25/2018

Malibu Boats, Inc. - 7.87% off its 52wkH on 06/15/2018, reports earnings on 09/07/2018

Norfolk Southern Corporation - 3.37% off its 52wkH on 07/13/2018, reports earnings on 07/25/2018

Stocks Trending in the News

Click name for Q-Factor rating and financial data.

Alphabet (GOOGL) subsidiary Google will likely be fined approximately EUR€4.3 billion (USD$5 billion) by EU antitrust regulators over the company’s practice of requiring android-operated smartphone makers to exclusively sell Google’s applications, according to Bloomberg reports

ASML Holding NV (ENXTAM: ASML) reported 2Q2018 net sales that were higher than expected (EUR€2.74 billion vs EUR€2.56 billion projected), and the company expects a strong 2H2018. Shares of ASML traded 5.70% higher to EUR€181.80

Boeing Company (BA) has been awarded a USD$3.9 billion contract with the US government, under which Boeing will provide two 747-8 aircraft to be used as Air Force One. The aircraft are due to be delivered in December 2024

Danske Bank’s (CPSE:DANSKE) net income in 2Q2018 fell short of forecasts (DKK4.23 billion vs DKK4.61 billion. Danske Bank has also pledged to forfeit any gain derived from money laundering. Danske Bank’s shares are down 9.14% to DKK27.71 in today’s trading

M&T Bank (MTB) announced 2Q2018 EPS that was higher than anticipated (USD$3.26 vs USD$3.17 forecasted). Shares of M&T Bank are unchanged pre-market

Morgan Stanley (MS) posted 2Q2018 EPS that was firmly above estimates (USD$1.30 vs USD$1.11 projected), and sales & trading revenue that also beat the consensus (USD$1.4 billion vs USD$1.24 billion). Shares of Morgan Stanley are up 3.50% to USD$50.90 pre-market

Netflix (NFLX) has been downgraded to neutral from a buy rating at Goldman Sachs. Despite being downgraded, shares of Netflix are up 0.82% to USD$382.61 before the open

Texas Instruments (TXN) CEO Brian Crutcher has resigned, following allegations that he violated the company’s code of conduct. Texas Instruments has declined 0.78% to USD$114.90

Twitter (TWTR) has been downgraded at Macquire to neutral from an outperform rating, marking the first downgrade for Twitter in 6 months. Twitter’s stock is 1.14% lower to USD$44.20 before the open

US Bancorp (USB) released 2Q2018 EPS that was modestly higher than expected (USD$1.02 vs USD$1.00 consensus). US Bancorp stock is trading 0.39% higher to USD$51.50 pre-market

Walmart Inc (WMT) is considering launching a subscription-based video streaming service, in an effort to compete with Netflix (NFLX) and Amazon (AMZN) Prime Video

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
Lam Research Corporation LRCX Information Technology Semiconductor Equipment 3.17% 3.46% -3.71%
Hill-Rom Holdings, Inc. HRC Healthcare Healthcare Equipment 3.12% 4.19% 11.79%
Burlington Stores, Inc. BURL Consumer Discretionary Apparel Retail 2.79% 3.59% 24.60%
PulteGroup, Inc. PHM Consumer Discretionary Homebuilding 2.62% 4.35% -7.01%
Broadcom Inc. AVGO Information Technology Semiconductors 2.49% -0.80% 0.00%

 

Losers Ticker Sector Industry 1 Day Return 5 Day Return  YTD
Cigna Corporation CI Healthcare Managed Healthcare -0.95% -1.30% 0.45%
AbbVie Inc. ABBV Healthcare Biotechnology -0.87% -0.21% 2.98%
Laboratory Corporation of America Holdings LH Healthcare Healthcare Services -0.85% -0.62% 2.96%
Louisiana-Pacific Corporation LPX Materials Forest Products -0.60% 1.50% 3.91%
Jefferies Financial Group Inc. JEF Financials Multi-Sector Holdings -0.66% -0.44% -0.88%

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
Airborne Wireless Network ABWN Telecommunication Services Alternative Carriers -16.67% -16.67% -79.17%
Rowan Companies plc RDC Energy Oil and Gas Drilling -4.27% -4.55% -5.93%
GameStop Corp. GME Consumer Discretionary Computer and Electronics Retail -4.20% -3.38% 0.07%
Sanderson Farms, Inc. SAFM Consumer Staples Packaged Foods and Meats -2.37% -6.51% -5.37%
PTC Therapeutics, Inc. PTCT Healthcare Biotechnology -2.36% -3.43% 4.45%

 

Losers Ticker Sector Industry 1 Day Return 5 Day Return  YTD
ACADIA Pharmaceuticals Inc. ACAD Healthcare Biotechnology 7.65% 2.25% -39.69%
Roku, Inc. ROKU Consumer Discretionary Consumer Electronics 6.49% 6.38% -0.75%
Sangamo Therapeutics, Inc. SGMO Healthcare Biotechnology 5.57% -0.98% -7.62%
AK Steel Holding Corporation AKS Materials Steel 5.29% 4.14% -15.55%
Spark Therapeutics, Inc. ONCE Healthcare Biotechnology 5.11% -2.16% 69.86%

Source: S&P Capital IQ

Events Calendar

On Mobile/Tablet scroll to the right.

Company Name Ticker Event Date Event Type Q-Factor Score
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
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
The Travelers Companies, Inc. TRV 7/19/2018 Earnings Release Date US Large-Cap: C
Fifth Third Bancorp FITB 7/19/2018 Earnings Release Date US Large-Cap: C
Dover Corporation DOV 7/19/2018 Earnings Release Date US Large-Cap: C, US Industrials: C
Webster Financial Corporation WBS 7/19/2018 Earnings Release Date US Large-Cap: C
The Bank of New York Mellon Corporation BK 7/19/2018 Earnings Release Date US Large-Cap: C
Danaher Corporation DHR 7/19/2018 Earnings Release Date US Large-Cap: A
BB&T Corporation BBT 7/19/2018 Earnings Release Date US Large-Cap: A
Signature Bank SBNY 7/19/2018 Earnings Release Date US Large-Cap: C
East West Bancorp, Inc. EWBC 7/19/2018 Earnings Release Date US Large-Cap: C
KeyCorp KEY 7/19/2018 Earnings Release Date US Large-Cap: B
The Blackstone Group L.P. BX 7/19/2018 Earnings Release Date US Large-Cap: D
Snap-on Incorporated SNA 7/19/2018 Earnings Release Date US Large-Cap: B, US Industrials: B
RPM International Inc. RPM 7/19/2018 Earnings Release Date US Large-Cap: A
Domino's Pizza, Inc. DPZ 7/19/2018 Earnings Release Date US Large-Cap: C, US Consumer Discretionary: A
Pool Corporation POOL 7/19/2018 Earnings Release Date US Large-Cap: A, US Consumer Discretionary: B
Genuine Parts Company GPC 7/19/2018 Earnings Release Date US Large-Cap: B, US Consumer Discretionary: B
Nucor Corporation NUE 7/19/2018 Earnings Release Date US Large-Cap: C
PPG Industries, Inc. PPG 7/19/2018 Earnings Release Date US Large-Cap: C
People's United Financial, Inc. PBCT 7/19/2018 Earnings Release Date US Large-Cap: B
Capital One Financial Corporation COF 7/19/2018 Earnings Release Date US Large-Cap: C
Skechers U.S.A., Inc. SKX 7/19/2018 Earnings Release Date US Large-Cap: D, US Consumer Discretionary: F
Cintas Corporation CTAS 7/19/2018 Earnings Release Date US Large-Cap: A, US Industrials: B
Celanese Corporation CE 7/19/2018 Earnings Release Date US Large-Cap: B
Skyworks Solutions, Inc. SWKS 7/19/2018 Earnings Release Date US Large-Cap: C, US Information Technology: B
Associated Banc-Corp ASB 7/19/2018 Earnings Release Date US Large-Cap: C
E*TRADE Financial Corporation ETFC 7/19/2018 Earnings Release Date US Large-Cap: B
Western Alliance Bancorporation WAL 7/19/2018 Earnings Release Date US Large-Cap: B
SEI Investments Co. SEIC 7/19/2018 Earnings Release Date US Large-Cap: B
Microsoft Corporation MSFT 7/19/2018 Earnings Release Date US Large-Cap: A, US Information Technology: B
Equifax Inc. EFX 7/19/2018 Estimated Earnings Release Date US Large-Cap: C, US Industrials: C
NVR, Inc. NVR 7/19/2018 Estimated Earnings Release Date US Large-Cap: B, US Consumer Discretionary: C
TCF Financial Corporation TCF 7/27/2018 Earnings Release Date US Large-Cap: C
Marriott Vacations Worldwide Corporation VAC 7/19/2018 Estimated Earnings Release Date US Large-Cap: A, US Consumer Discretionary: B
LaSalle Hotel Properties LHO 7/19/2018 Estimated Earnings Release Date US Large-Cap: F

Source: S&P Capital IQ