Morning Quant Ride Feb 26, 2018

Feb 26, 2018

Traders’ Corner

Asian markets closed up across the board with the Nikkei 225 up 1.19%, Hang Seng up 0.74%, Hang Seng China Enterprise Index up 0.78% and the CSI 300 up 1.16%.  In Japan, all sectors finished positive with financials, industrials and materials stocks the biggest laggards.  In Hong Kong, only telecom stocks were down with consumer and utilities stocks leading the positive move.  News that the CCP has opened a pathway for current President Xi Jingping to remain in office indefinitely dominated news headlines over the weekend. 

 

In the Land Down Under, Australian stocks finished the trading session in the green with the ASX 200 closing up 0.78%.  The positive move in Aussie stocks was driven by real estate, financials and telecom stocks while consumer staples, utility and tech stocks closed down.  Aussie government bond yields moved lower in sympathy with stocks.

European equities are higher across the board with the Euro Stoxx 600 up 0.51%.  Regional indices are up with the FTSE 100 +0.57%, DAX +0.31% and the CAC 40 +0.52%.  Materials, personal & household, and tech stocks are driving the positive move in European stocks.  Construction, utilities and banks are the largest underperformers this morning. 

US government yields are slightly down this morning with the 10-year yield currently sitting at 2.848%.  After last week’s rally, the USD$ is down against all major currencies.  Weakness in the USD$ can be attributed to speculation that Fed Chairman Powell will continue the policy of a gradual increase in benchmark rates.  At the moment, US Fed Funds futures are only pricing 2 to 3 rate hikes in CY2018.  Oil prices are down in sympathy with the weaker USD$.  Supply trends continue to support USD$60/barrel for WTI.  Precious metals are up this morning, in sympathy with the strong JPY¥.  In a previous morning commentary, we discussed the correlation between the JPY¥ and precious metals prices. 

Following price weakness over the weekend, the major cryptocurrencies are trading with a positive bias.  Bitcoin, Ethereum and Litecoin are all up over 1% while Ripple is the notable laggard of the Top 10, down slightly more than 1% and trading around USD$0.93.  The Chairman of the Swiss Stock Exchange made headlines this morning after he suggested that he sees upside to a launch of a crypto Franc. 

US equity futures are pointing to a positive open in NY.  The VIX currently is flat at 16.50, sitting at its long-run average.  US equity markets were significantly higher on Friday, with large-caps outperforming small-caps. The S&P 500 rallied 1.60%, while the Russell 2000 was up 1.25%. All sectors of the S&P 500 were positive with utilities, energy and tech stocks the biggest gainers, while consumer staples, industrials and telecom stocks the largest underperformed. Hewlett Packard Enterprise (HPE), Nordstrom (JWN), and Advance Auto Parts (AAP) were the biggest positive movers of the S&P 500, while General Mills (GIS), SCANA Corporation (SCG), and Envision Health Care (EVHC) were the biggest laggards. Our Top Rated Large Cap Low Volatility & Momentum stocks were our best performers, returning 1.49%, outperforming our Quality Value and Technicals factors, which rose 1.29% and 1.19%, respectively.

Following Friday’s rally, we are watching a few of our A-rated Consumer stocks that lagged the market:

QuantShot: Campbell Soup Company - 26.39% off its 52wkH, reports earnings on 05/18/2018

Deckers Outdoor Corp. - 2.66% off its 52wkH, reports earnings on 05/24/2018

Lear Corporation - 6.57% off its 52wkH, reports earnings on 04/27/2018

Pilgrim’s Pride Corporation - 34.85% off its 52wkH, reports earnings on 05/03/2018

Scripps Networks Interactive - 1.26% off its 52wkH, reports earnings on 02/27/2018

We are also keeping an eye on these A-rated companies:

QuantShot: Advanced Energy Industries - 26.39% off its 52wkH, reports earnings on 05/18/2018

QuantShot: Allison Transmission Holdings - 2.66% off its 52wkH, reports earnings on 05/24/2018

Skyworks Solutions - 6.57% off its 52wkH, reports earnings on 04/27/2018

United Therapeutics Corp. - 34.85% off its 52wkH, reports earnings on 05/03/2018

QuantShot: Xcerra Corp. - 1.26% off its 52wkH, reports earnings on 02/27/2018

Our Top Picks in the News

Click headline for story

Alphabet Inc (GOOGL)

Google Partners With OEMs to Bring AR Service to China (Yahoo Finance)
Top Conviction Buy in February, please see Quantamize Global Top Picks US Tech report

 

See more on our Alphabet QuantShot company report from January 11th

Micron Technology (MU)

Micron Announces Leading-Edge, Mobile 3D NAND Solutions for Flagship Smartphones (Micron Investor Relations)
Top Conviction Buy in February, please see Quantamize Global Top Picks US Tech report

 

See more on our Micron QuantShot company report from January 10th

Union Pacific (UNP)

Union Pacific (UNP) Up 1% Since Earnings Report: Can It Continue? (Yahoo Finance)
Top Conviction Buy in February, please see Quantamize Global Top Picks US Industrials report

 

See more on our Union Pacific QuantShot company report from February 12th

Allison Transmisisons (ALSN)

Allison Transmission (ALSN) Stock Rating Upgraded by Zacks Investment Research (Stock News Times)
Top Conviction Buy in February, please see Quantamize Global Top Picks US Industrials report

 

See more on our Allison Transmissions QuantShot company report from February 16th

Tesla Inc (TSLA)

Tesla Model 3 Ramp Guidance At Risk: Production Is Likely Well Below 1000 Per Week (Seeking Alpha)
Top Conviction Short in February, please see Quantamize Global Top Picks US Large Cap report

 

See more on our Tesla QuantShot company report from February 6th

Piper Jaffray (PJC)

Piper Jaffray goes ex-dividend on Monday (Seeking Alpha)
Top Conviction Buy in February, please see Quantamize Global Top Picks US SMID Cap report

 

See more on our Piper Jaffray QuantShot company report from February 7th

Walmart (WMT)

Walmart to launch new higher-end brands (Seeking Alpha)
Top Conviction Buy in February, please see Quantamize Global Top Picks US Consumer Staples report

 

See more on our Walmart QuantShot company report from February 6th

Global Indices

Index

Levels

1 Day Return

5 Day Return

MTD

YTD

S&P 500

2,747.30

0.00%

0.10%

-4.34%

1.04%

Russell 2000

1,549.19

0.00%

0.64%

-2.74%

-0.24%

DJ Industrial Average

25,309.99

0.00%

-0.38%

-5.17%

0.32%

NASDAQ Composite Index

7,337.39

0.00%

1.04%

-2.61%

4.56%

CBOE Market Volatility Index

16.46

-

-

-

-

Germany DAX (TR)

12,522.42

0.31%

1.06%

-6.02%

-3.46%

France CAC 40

5,344.53

0.51%

2.65%

-3.50%

-0.20%

Japan Nikkei 225

22,153.63

1.19%

3.86%

-5.90%

-3.49%

Hang Seng Index

31,498.60

0.74%

3.00%

-5.84%

5.06%

Hang Seng China Enterprises

12,834.06

0.78%

3.47%

-7.62%

8.35%

S&P ASX 200

6,042.20

0.71%

1.75%

-1.44%

-2.00%

Source: FactSet          

Large Cap Conviction Buy Movers

Large Cap A Winners Ticker Sector Industry 1 Day Return 5 Day Return YTD
Zebra Technologies Corporation ZBRA Information Technology Electronic Equipment and Instruments

4.92%

18.00%

36.71%

PetMed Express, Inc. PETS Consumer Discretionary Internet and Direct Marketing Retail

4.36%

6.86%

3.74%

PRA Health Sciences, Inc. PRAH Healthcare Life Sciences Tools and Services

3.84%

-3.06%

-5.37%

Adobe Systems Incorporated ADBE Information Technology Application Software

3.52%

4.06%

19.69%

HP Inc. HPQ Information Technology Technology Hardware, Storage and Peripherals

3.46%

3.41%

5.33%

Large Cap A Losers Ticker Sector Industry 1 Day Return 5 Day Return YTD
RH RH Consumer Discretionary Home Furnishing Retail

-3.14%

-5.19%

2.66%

Ligand Pharmaceuticals Incorporated LGND Healthcare Biotechnology

-1.11%

-2.12%

12.33%

The Children's Place, Inc. PLCE Consumer Discretionary Apparel Retail

-0.51%

-2.55%

0.00%

Carter's, Inc. CRI Consumer Discretionary Apparel, Accessories and Luxury Goods

-0.25%

-0.11%

2.61%

Parker-Hannifin Corporation PH Industrials Industrial Machinery

-0.19%

0.19%

-8.02%

Source: Capital IQ            

Large Cap Conviction Short Movers

Large Cap F Winners Ticker Sector Industry 1 Day Return  5 Day Return YTD
Exact Sciences Corporation EXAS Healthcare Biotechnology

-5.82%

-13.28%

-19.36%

Adamas Pharmaceuticals, Inc. ADMS Healthcare Biotechnology

-5.07%

-22.95%

-23.22%

Pandora Media, Inc. P Information Technology Internet Software and Services

-4.65%

-16.47%

-10.58%

ARMO BioSciences, Inc. ARMO Healthcare Biotechnology

-4.06%

-14.15%

0.00%

MACOM Technology Solutions Holdings, Inc. MTSI Information Technology Semiconductors

-3.87%

3.68%

-35.06%

Large Cap F Losers Ticker Sector Industry 1 Day Return  5 Day Return YTD
Longfin Corp. LFIN Financials Financial Exchanges and Data

8.60%

6.08%

-35.19%

Sage Therapeutics, Inc. SAGE Healthcare Biotechnology

5.63%

1.10%

-0.34%

Oasis Petroleum Inc. OAS Energy Oil and Gas Exploration and Production

5.14%

10.97%

4.64%

LPL Financial Holdings Inc. LPLA Financials Investment Banking and Brokerage

4.80%

2.58%

14.63%

Parsley Energy, Inc. PE Energy Oil and Gas Exploration and Production

4.67%

11.72%

-10.97%

Source: Capital IQ            

Upcoming Earnings

Company Name Ticker Earnings Date
Leucadia National Corporation LUK 02/27/2018
NuVasive, Inc. NUVA 02/27/2018
Scripps Networks Interactive, Inc. Class A SNI 02/27/2018
Snyder's-Lance, Inc. LNCE 02/28/2018
Priceline Group Inc PCLN 02/28/2018
Carter's, Inc. CRI 02/28/2018
TJX Companies Inc TJX 02/28/2018
Pinnacle Foods, Inc. PF 03/01/2018
Big Lots, Inc. BIG 03/02/2018
Children's Place, Inc. PLCE 03/07/2018
Costco Wholesale Corporation COST 03/08/2018
Adobe Systems Incorporated ADBE 03/15/2018

Line for QuantShots

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