Morning Quant Ride

May 14, 2018

Your Key Morning Highlights

  • US equity index futures are gaining this morning with Dow Jones minis +0.29%, S&P500 minis +0.18% and Nasdaq 100 minis +0.25%
  • US President Trump has instructed the US Commerce Department to assist ZTE Corp (SZSE:000063) with a “way back into business” in the US
  • Oil prices are relatively flat this morning with WTI holding above USD$70/barrel
  • The VIX is at 13.07 in pre-market after closing at 12.65 on Friday – the lowest close since January 2018
  • European stocks are little changed with the Euro Stoxx 600 -0.20%
  • Market breadth for European stocks are positive with 312 stocks gaining and 263 stocks declining in the Euro Stoxx 600
  • Asian stocks closed up across the board with the Nikkei 225 +0.47%, Hang Seng +1.35%, and Hang Seng China Enterprise +1.61%
  • Aussie stocks finished their trading session positive with the ASX 200 +0.31%
  • Market sentiment in Asia turned positive on speculation that the US and China are looking to avoid a costly trade war
  • US$ Index is down 0.26% on strength in the EUR€ +0.33% and GBP£ +0.36%
  • Yields on US sovereign debt is little changed with the yield on the US 10-year currently at 2.979%
  • Italian sovereign yields are moving up with the yield on the 10-year Italian bond +5.3 basis points to 1.915%
  • Spanish 10-year bonds are selling off with the yield on the 10-year Spanish bond +4.4 basis points to 1.298%
  • HSBC reportedly has completed the first commercial trade-finance transaction using blockchain. The exchange was a shipment of soybeans transported from Argentina to Malaysia last week and parties involved used blockchain technology developed by the R3 consortium
  • Bitbond, an online German bank, is now allowing customers to transfer loans using Bitcoin. Payments work independently of where customers are located
  • The Reserve Bank of Zimbabwe (RBZ) has banned all financial services institutions in the country from trading cryptocurrency. The central bank stated that it is hoping to protect the public and the country’s financial system
  • Quantamize’s rolling 3-Day Cryptocurrency Signals are on day three of their forecast and currently only 3 cryptocurrencies are “Buys” out of the 30 cryptocurrencies that Quantamize models

*Data in Price Return 

S&P 500 Sector Performance

Conviction Buy Laggards From Friday We Are Watching To Begin the Week

Click name for Q-Factor rating and financial data.

Advanced Energy Industries, Inc. - 31.78% off its 52wkH on 10/30/2017, reports earnings on 08/01/2018

Axcelis Technologies, Inc. - 40.28% off its 52wkH on 11/24/2017, reports earnings on 08/02/2018

Lam Research Corporation - 14.19% off its 52wkH on 03/13/2018, reports earnings on 07/26/2018

Micron Technology, Inc. - 18.29% off its 52wkH on 03/13/2018, reports earnings on 06/22/2018

MKS Instruments, Inc. - 11.29% off its 52wkH on 03/12/2018, reports earnings on 07/26/2018

ON Semiconductor Corporation - 13.69% off its 52wkH on 03/13/2018, reports earnings on 07/30/2018

Stocks Trending in the News

Click name for Q-Factor rating and financial data.

Airbus SE (ENXTPA:AIR.FR) CFO Harald Wilhelm announced that he will be leaving his position in Airbus in April of 2019. Airbus CEO Tom Enders is also scheduled to depart the company in April of next year.

Aurora Canabis (TSX:ACB) has announced that it will be acquiring rival MedReleaf (TSX:LEAF) for C$3.2 billion.

ConocoPhillips (COP) has seized $636 million worth of assets from Venezuela state owned oil company PDVSA. ConocoPhillips was awarded $2 billion in reparations from PVDSA during arbitration in 2007, following the nationalization of Conoco assets by former leader Hugo Chavez. The assets seized by ConocoPhillips included an oil refinery in Curacao.

Cummins Inc (CMI) has entered into a joint venture partnership with Chinese automaker Anhui Jianghaui Automobile Co (SHSE:600418). Each company receives 50% equity in the joint venture, called JAC-Navistar Diesel Engine Company.

Disney (DIS) film “Avengers: Infinity War” opened in China this weekend and recorded the second biggest weekend opening ever in China pulling in an estimated $200 million.

Hostess Brands Inc (TWNK) has been downgraded to a hold rating at Deutsche Bank (DB:DBK).

Nissan (TSE:7201) CEO Hiroto Saikawa remarked that his company is not currently negotiating a merger with Renault SA (ENXTPA:RNO). Instead, Nissan is focused on the alliance partnership with Renault.

Qualcomm’s (QCOM) acquisition bid for Chinese firm NXP Semiconductors (NXPI) is once again under review by Chinese regulators. A previous review was put on hold due to escalating Sino-American trade tensions.

Xerox (XRX) has reached a settlement with shareholders Carl Ichan and Darwin Deason, that will see Xerox end its $6.1 billion merger deal with Fujifilm (TSE:4901). Xerox CEO Jeff Jacobson, who had negotiated the merger deal, has resigned his position..

President Trump’s tweet about getting Chinese phone maker ZTE Corp (SZSE:000063) “back into business fast” comes as welcome news for the struggling firm. On April 15th, the US Commerce Department banned American companies from supplying electronic parts to ZTE, after determining that the company had violated a agreements in 2017, and slapped the company with $900 million in fines.

Major companies reporting earnings over the next 24 hours:

Agilent Technology (A)

Home Depot (HD)

Cryptocurrencies Today

Stock Movers

Conviction Buy Winners and Losers

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Winners  Ticker Sector Industry 1 Day Return 5 Day Return  YTD
Verizon Communications Inc. VZ Telecommunication Services Integrated Telecommunication Services 3.01% 0.89% -8.14%
Lowe's Companies, Inc. LOW Consumer Discretionary Home Improvement Retail 2.80% 3.82% -5.91%
Express Scripts Holding Company ESRX Healthcare Healthcare Services 2.59% 3.67% -2.47%
Louisiana-Pacific Corporation LPX Materials Forest Products 1.98% -1.98% 5.71%
Eli Lilly and Company LLY Healthcare Pharmaceuticals 1.97% 5.17% -2.38%

 

Losers Ticker Sector Industry 1 Day Return 5 Day Return  YTD
Micron Technology, Inc. MU Information Technology Semiconductors -1.60% 8.91% 12.70%
Lam Research Corporation LRCX Information Technology Semiconductor Equipment -1.21% 3.11% 8.91%
Darden Restaurants, Inc. DRI Consumer Discretionary Restaurants -1.11% -2.69% -2.72%
The J. M. Smucker Company SJM Consumer Staples Packaged Foods and Meats -1.00% -0.26% -0.93%
Berkshire Hathaway Inc. BRK.B Financials Multi-Sector Holdings -0.86% 1.70% 2.61%

Source: S&P Capital IQ

Conviction Short Winners and Losers

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Winners Ticker Sector Industry 1 Day Return 5 Day Return  YTD
Camping World Holdings, Inc. CWH Consumer Discretionary Automotive Retail -5.62% -17.20% -23.68%
Centennial Resource Development, Inc. CDEV Energy Oil and Gas Exploration and Production -4.15% 5.41% 5.30%
Box, Inc. BOX Information Technology Internet Software and Services -4.10% 12.74% 19.64%
nLIGHT, Inc. LASR Information Technology Electronic Equipment and Instruments -3.65% 2.73% 20.58%
Range Resources Corporation RRC Energy Oil and Gas Exploration and Production -3.18% 4.92% 3.18%

 

Losers Ticker Sector Industry 1 Day Return 5 Day Return  YTD
Blueprint Medicines Corporation BPMC Healthcare Biotechnology 7.26% 3.93% 8.09%
Sangamo Therapeutics, Inc. SGMO Healthcare Biotechnology 5.14% -6.12% -6.40%
Sage Therapeutics, Inc. SAGE Healthcare Biotechnology 4.67% 14.99% 3.59%
Tempur Sealy International, Inc. TPX Consumer Discretionary Home Furnishings 4.46% 10.27% -22.95%
Arena Pharmaceuticals, Inc. ARNA Healthcare Biotechnology 4.31% 4.34% 32.44%

Source: S&P Capital IQ

Events Calendar

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Company Name Ticker Event Date Event Type Q-Factor Score
China Lodging Group, Limited HTHT 5/14/2018 Earnings Release Date China All-Cap: A
Agilent Technologies, Inc. A 5/14/2018 Earnings Release Date US Large-Cap: C
Invitation Homes Inc. INVH 5/14/2018 Earnings Release Date US Large-Cap: D
Hollysys Automation Technologies Ltd. HOLI 5/14/2018 Earnings Release Date China All-Cap: C
SIG plc SHI 5/14/2018 Estimated Earnings Release Date China All-Cap: A
Future Land Development Holdings Limited SEHK:1030 5/14/2018 Estimated Earnings Release Date China All-Cap: A
China Lilang Limited SEHK:1234 5/14/2018 Estimated Earnings Release Date China All-Cap: A
Man Wah Holdings Limited SEHK:1999 5/14/2018 Earnings Release Date China All-Cap: D
Huarong Investment Stock Corporation Limited SEHK:2277 5/14/2018 Estimated Earnings Release Date China All-Cap: D
Champion Real Estate Investment Trust SEHK:2778 5/14/2018 Estimated Earnings Release Date China All-Cap: C
CAR Inc. SEHK:699 5/14/2018 Earnings Release Date China All-Cap: C
ChinaNet Online Holdings, Inc. CNET 5/14/2018 Estimated Earnings Release Date China All-Cap: D
Recon Technology, Ltd. RCON 5/14/2018 Estimated Earnings Release Date China All-Cap: F
Vipshop Holdings Limited VIPS 5/14/2018 Estimated Earnings Release Date China All-Cap: B
500.com Limited WBAI 5/14/2018 Estimated Earnings Release Date China All-Cap: C
YY Inc. YY 5/14/2018 Estimated Earnings Release Date China All-Cap: A
Zai Lab Limited ZLAB 5/14/2018 Estimated Earnings Release Date China All-Cap: F
Xunlei Limited XNET 5/14/2018 Estimated Earnings Release Date China All-Cap: C
PPDAI Group Inc. PPDF 5/14/2018 Estimated Earnings Release Date China All-Cap: C
GreenTree Hospitality Group Ltd. GHG 5/14/2018 Earnings Release Date China All-Cap: F
Xinyi Solar Holdings Limited SEHK:968 5/14/2018 Estimated Earnings Release Date China All-Cap: B
Phoenix New Media Limited FENG 5/14/2018 Earnings Release Date China All-Cap: C
SORL Auto Parts, Inc. SORL 5/14/2018 Earnings Release Date China All-Cap: C