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Morning Brief

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Morning Quant Ride

Jul 25, 2018

US Stocks                                                                                                                                                                           Start Your Free Trial Today

  • Global stocks are declining this AM ahead of a trade summit at the White House between US President Donald Trump and European Union (EU) Jean-Claude Juncker. The focus of discussions is expected to be on the US government’s decision to implement tariffs on imported cars.
  • US stocks index futures are pointing to a negative open in NY with the Dow Jones minis -0.07%, S&P500 minis -0.15% and Nasdaq 100 minis -0.02%
  • The VIX is flat this morning, currently at 12.44 after closing at 12.41 yesterday
  • EEM September 2018 OTM Calls, HYG August 17 & September 2018 OTM Puts, SPY July 27 OTM Calls, and August 17 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 2.941%
  • The USD$ Index (DXY) is little changed, down -0.12%, with no notable movers

International Stocks

  • European stocks are declining this morning ahead of US-EU trade summit at the White House: Euro Stoxx 600 -0.07%, FTSE 100 -0.64%, DAX -0.22%, and CAC 40 +0.02%
  • Investor sentiment is neutral to negative with the advance/decline ratio for the Euro Stoxx 600 currently at 0.86
  • VSTOXX, the European stocks equivalent of the VIX, is moving up this AM, presently at 13.0075 after closing at 12.7259 yesterday
  • Asian stocks finished their trading sessions positive with investor sentiment boosted by a better than expected start to the earnings season in the US: Nikkei 225 +0.46%, CSI 300 -0.11%, HSI +0.90% and Hang Seng China Enterprise +0.91%

Cryptos

  • US-based Coinbase is launching a crypto-backed gift card in Europe.  Users of WeGift will be able to convert digital assets held in their Coinbase wallet to gift cards.  Gift cards from WeGift can be used at over 120 retailers across the UK, France, Spain, the Netherlands and Italy
  • Japan Virtual Currency Exchange Association is suggesting domestic trading platforms limit investors up to 4x leverage on their deposits.  According to the Financial Services Agency, there are 142,000 crypto traders focused on derivatives a/o CY2017 in Japan, still a small portion of the estimated 3mm crypto traders in Japan.  Just as a point of reference, 80%of crypto trading volume in Japan for CY2017 came derivatives trading, recording USD$543bn - - 90%+ was from margin traders.
  • KT Corporation, South Korea’s largest telephone company, is launching a blockchain commercial network.  KT Corp is building a blockchain layer on top of its country-wide network to make it more secure and transparent.  This development should help KT customers store and transfer digital assets with  “less hacking risk”.
  • A Coinbase internal investigation finds that no insider trading took place in Bitcoin Cash (BCH) ahead of its listing on the Coinbase platform. 
  • Bitfi, a new crypto wallet, has launched claiming to be the first and only wallet that can’t be hacked.  It is currently priced at USD$120 and supports Bitcoin (BTC), Monero (XMR), Litecoin (LTX), Ethereum (ETH), NEO and Ethereum ERC-20 tokens such as Docademic (MTC), ENG, OMG, etc

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

S&P 500 Sector Performance

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

Top Buy Laggards From Yesterday We Are Watching Today

Click name for Q-Factor rating and financial data.

B&G Foods, Inc. - 23.40% off its 52wkH on 12/04/2017, reports earnings on 08/02/2018

Darden Restaurants, Inc. - 4.00% off its 52wkH on 07/19/2018, reports earnings on 09/25/2018

Micron Technology, Inc. - 17.77% off its 52wkH on 05/30/2018, reports earnings on 09/28/2018

MCBC Holdings, Inc. - 16.15% off its 52wkH on 05/18/2018, reports earnings on 09/07/2018

MKS Instruments, Inc. - 23.64% off its 52wkH on 03/12/2018, reports earnings on 07/24/2018

Norfolk Southern Corporation - 2.12% off its 52wkH on 07/23/2018, reports earnings on 07/25/2018

Photronics, Inc. - 18.16% off its 52wkH on 11/29/2017, reports earnings on 08/15/2018

Stocks Trending in the News

Click name for Q-Factor rating and financial data.

Advantest (6857 JP) reported 1Q operating profit that handily beat forecasts; delivering Y(yen) 15.8bn compared to Y10.8bn that the market was expecting.  Orders jumped 43% as the company mentioned a sharp increase in demand from data centers.

Deere & CO (DE) jumped in trading yesterday after the US government announced an aid package for farmers hurt by trade tensions.  American farmers are the biggest market for Deere products.

Fiat Chrysler (FCA IM) cut its financial targets today afterr seeing disappointing sales in China.  Revenue guidance of 115-118bn euros, down from 125bn.   Also, ex-CEO Sergio Marchionne has died just days after being replaced as CEO.  He is credited with taking near bankrupt Fiat in 2014 and creating Fiat Chrysler Automobiles with the purchase of the US automaker.

Fosun International Ltd (656 HK) is considering  acquiring all or part of Belgian insurer Ageas (AGS BB), according to press reports, sending Ageas soaring today.

GlaxoSmithKline (GSK LN) raised growth expectations for 2018 profit, citing strong sales of their new shingles vaccine.  They expect adjusted growth earnings of 7-10% this year, up from 7% previously announced.

Ingersoll-Rand (IR) reported 2Q2018 EPS that was higher than expected ($1.85 vs $1.72). Shares of Ingersoll-Rand are up 1.06% to $92.05 pre-market

Mitsubishi Motors (7211 JP) dropped over 5% during trading after SMBC Nikko commented that 1Q results were disappointing compared to 4Q.  North Americas was cited as a particular concern where OEM orders saw a decline.

Outotec (OTE1V) dropped sharply in Helsinki after reporting a 2Q loss of EU3mn while expectations were for a EU12.7mn profit.

Qualcomm (QCOM) is not likely to receive Chineseapproval for its purchase of NXP (NXPI), according to Reuters, where the deadline is today.  As such, Qualcomm is preparing to pay NXP a termination fee of US$2bn.

STMicroelectronics NV (STM) expects 10% growth in revenue in 3Q citing significant growth from personal electronics, especially smartphones.  The new CEO is continuing the strategy of diversification of customers.

Teradyne (TER) posted 2Q2018 EPS that beat the consensus ($0.59 vs $0.49). Teradyne stock is 8.96% higher, to $44.00 per share before trading today

Whirlpool (WHR) was downgraded by RBC after reporting weak 2Q results citing raw material costs and tariff challenges as significant headwinds.

Cryptocurrencies Today

*Source: Stockdio

Stock Movers

Top Buy Winners and Losers

On Mobile/Tablet scroll to the right

Winners  Ticker Sector Industry 1 Day Return 5 Day Return  YTD
AbbVie Inc. ABBV Healthcare Biotechnology 2.39% 1.77% -5.35%
Facebook, Inc. FB Information Technology Internet Software and Services 1.78% 3.16% 21.65%
Fortive Corporation FTV Industrials Industrial Machinery 1.61% -0.27% 6.99%
IDEX Corporation IEX Industrials Industrial Machinery 1.56% -0.76% 5.78%
The Boeing Company BA Industrials Aerospace and Defense 1.42% 0.83% 21.48%
Losers Ticker Sector Industry 1 Day Return 5 Day Return  YTD
Zions Bancorporation ZION Financials Regional Banks -2.88% -1.79% -0.84%
Chemed Corporation CHE Healthcare Healthcare Services -2.70% -2.24% -0.36%
Five Below, Inc. FIVE Consumer Discretionary Specialty Stores -2.59% -8.63% 0.93%
Tractor Supply Company TSCO Consumer Discretionary Specialty Stores -2.20% -1.24% 2.20%
PulteGroup, Inc. PHM Consumer Discretionary Homebuilding -2.21% -3.68% 4.83%

Source: S&P Capital IQ

Top Short Winners and Losers

On Mobile/Tablet scroll to the right

Winners Ticker Sector Industry 1 Day Return 5 Day Return  YTD
Applied Optoelectronics, Inc. AAOI Information Technology Communications Equipment -8.88% -9.98% -14.79%
Editas Medicine, Inc. EDIT Healthcare Biotechnology -7.76% -9.58% -8.87%
Intercept Pharmaceuticals, Inc. ICPT Healthcare Biotechnology -6.87% -7.56% 5.46%
Roku, Inc. ROKU Consumer Discretionary Consumer Electronics -5.69% -5.78% 10.07%
Immunomedics, Inc. IMMU Healthcare Biotechnology -5.36% -5.65% 3.63%
Losers Ticker Sector Industry 1 Day Return 5 Day Return  YTD
BrightView Holdings, Inc. BV Industrials Environmental and Facilities Services 3.07% 4.73% 0.00%
Oasis Petroleum Inc. OAS Energy Oil and Gas Exploration and Production 2.58% 2.15% 46.73%
Groupon, Inc. GRPN Consumer Discretionary Internet and Direct Marketing Retail 2.57% 0.84% -6.08%
Whiting Petroleum Corporation WLL Energy Oil and Gas Exploration and Production 2.21% 1.92% 92.18%
Neurocrine Biosciences, Inc. NBIX Healthcare Biotechnology 1.87% 1.86% 36.28%

Source: S&P Capital IQ

Events Calendar

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Company Name Ticker Event Date Event Type Q-Factor Score
Evercore Inc. EVR 7/25/2018 Earnings Release Date US Large-Cap: D
Tupperware Brands Corporation TUP 7/25/2018 Earnings Release Date US Large-Cap: F, US Consumer Discretionary: D
New York Community Bancorp, Inc. NYCB 7/25/2018 Earnings Release Date US Large-Cap: C
Dana Incorporated DAN 7/25/2018 Earnings Release Date US Large-Cap: C, US Consumer Discretionary: C
United Parcel Service, Inc. UPS 7/25/2018 Earnings Release Date US Large-Cap: B, US Industrials: B
The Brink's Company BCO 7/25/2018 Earnings Release Date US Large-Cap: C, US Industrials: C
FLIR Systems, Inc. FLIR 7/25/2018 Earnings Release Date US Large-Cap: C, US Information Technology: C
Boston Scientific Corporation BSX 7/25/2018 Earnings Release Date US Large-Cap: C
Sirius XM Holdings Inc. SIRI 7/25/2018 Earnings Release Date US Large-Cap: B, US Consumer Discretionary: A
USG Corporation USG 7/25/2018 Earnings Release Date US Large-Cap: C, US Industrials: D
Lamb Weston Holdings, Inc. LW 7/25/2018 Earnings Release Date US Large-Cap: A, US Consumer Staples: B
Thermo Fisher Scientific Inc. TMO 7/25/2018 Earnings Release Date US Large-Cap: B
The Coca-Cola Company KO 7/25/2018 Earnings Release Date US Large-Cap: C, US Consumer Staples: C
Corning Incorporated GLW 7/25/2018 Earnings Release Date US Large-Cap: C, US Information Technology: C
Rockwell Automation Inc. ROK 7/25/2018 Earnings Release Date US Large-Cap: C, US Industrials: C
Norfolk Southern Corporation NSC 7/25/2018 Earnings Release Date US Large-Cap: B, US Industrials: B
DTE Energy Company DTE 7/25/2018 Earnings Release Date US Large-Cap: D
Lithia Motors, Inc. LAD 7/25/2018 Earnings Release Date US Large-Cap: B, US Consumer Discretionary: C
Watsco, Inc. WSO 7/25/2018 Earnings Release Date US Large-Cap: B, US Industrials: B
MarketAxess Holdings Inc. MKTX 7/25/2018 Earnings Release Date US Large-Cap: D
Polaris Industries Inc. PII 7/25/2018 Earnings Release Date US Large-Cap: C, US Consumer Discretionary: C
A. O. Smith Corporation AOS 7/25/2018 Earnings Release Date US Large-Cap: B, US Industrials: C
Owens Corning OC 7/25/2018 Earnings Release Date US Large-Cap: B, US Industrials: A
RPC, Inc. RES 7/25/2018 Earnings Release Date US Large-Cap: C
Laboratory Corporation of America Holdings LH 7/25/2018 Earnings Release Date US Large-Cap: A
Six Flags Entertainment Corporation SIX 7/25/2018 Earnings Release Date US Large-Cap: C, US Consumer Discretionary: B
Santander Consumer USA Holdings Inc. SC 7/25/2018 Earnings Release Date US Large-Cap: D
Hilton Worldwide Holdings Inc. HLT 7/25/2018 Earnings Release Date US Large-Cap: B, US Consumer Discretionary: B
Huntington Bancshares Incorporated HBAN 7/25/2018 Earnings Release Date US Large-Cap: C
GrubHub Inc. GRUB 7/25/2018 Earnings Release Date US Large-Cap: D, US Information Technology: B
Euronet Worldwide, Inc. EEFT 7/25/2018 Earnings Release Date US Large-Cap: C, US Information Technology: C
General Motors Company GM 7/25/2018 Earnings Release Date US Large-Cap: C, US Consumer Discretionary: B
Waste Management, Inc. WM 7/25/2018 Earnings Release Date US Large-Cap: A, US Industrials: B
Rollins, Inc. ROL 7/25/2018 Earnings Release Date US Large-Cap: B, US Industrials: C
The Boeing Company BA 7/25/2018 Earnings Release Date US Large-Cap: A, US Industrials: C

Source: S&P Capital IQ