Morning Quant Ride

May 18, 2018

Your Key Morning Highlights

US Markets

  • US equity index futures are advancing this AM with Dow Jones minis +0.27%, S&P500 minis +0.17% and Nasdaq 100 minis +0.19%
  • US$ Index is flat with a positive bias at +0.13% with weakness in the EUR€ offset by strength in the JPY¥ and CHF
  • US government bonds are little changed this morning with the yield on the US 10-year is sitting at 3.102%
  • Gold spot is down 0.30% to USD$1,287.25/ounce - - the lowest level since December 2017

International Markets

  • European stocks are weak this morning with the Euro Stoxx -0.11%, FTSE 100 -0.10%, CAC 40 +0.07% and DAX +0.04%
  • Conflicting reports about whether Chinese trade officials told US trade officials that the Chinese trade surplus with the US could be narrowed is weighing on stocks in Europe
  • Asian stocks finished their trading sessions positive with the Nikkei 225 +0.40%, Hang Seng +0.34%, Hang Seng China Enterprise +0.62%
  • Hong Kong energy stocks had their biggest positive moves in over a month with Brent hovering around USD$80/barrel
  • Italian sovereign bonds continue their slide this AM with the yield on the Italian 10-year up 6.6 basis points to 2.251%
  • The yield on the Italian 10-year is at the highest level since October 2017 when the yield was 2.180%
  • The sell-off Aussie sovereign bonds this week continues with the Aussie 10-year yield +4.0 basis points to 2.919%
  • UK GILTs are rallying with the yield on the UK 10-year sovereign down 2.3 basis points to 1.538%
  • Aussie sovereigns are reversing their slide the past few days with the yield on the Aussie 10-year down 2 basis points this AM to 2.899%

Cryptos

  • Coinbase has invested in a cryptocurrency startup that lets users earn interest on cryptocurrencies. This investment was seeded by Coinbase Venture, the firm’s venture capital unit. Compound will initially operate on the Ethereum (ETH) blockchain but the company is further planning to have tokenized versions of the Dollar, Yen, Euro and Google stock
  • Switzerland is considering the possibility of a state-backed cryptocurrency according to a Reuters report. Switzerland’s Federal Council explained it is aware of the major challenges on the legal and monetary front which would accompany the use of an e-franc. This sentiment is a shift from the central bank’s stance that cryptocurrencies are inherently instable from just over a month ago
  • Russian bank Evrofinance Mosnarbank is ignoring a US campaign that disrupts Venezuela’s state-backed cryptocurrency, the Petro. The Petro is struggling to find investor demand as popular exchanges are choosing not to list the cryptocurrency. Venezuela had to create 16 of its own exchanges to list the cryptocurrency

*Data in Price Return

S&P 500 Sector Performance

Conviction Buy Laggards From Yesterday We Are Watching Today

Click name for Q-Factor rating and financial data.

Apple Inc. - 1.78% off its 52wkH on 05/10/2018, reports earnings on 07/31/2018

KLA-Tencor Corporation - 8.65% off its 52wkH on 03/13/2018, reports earnings on 07/27/2018

Lam Research Corporation - 13.43% off its 52wkH on 03/13/2018, reports earnings on 07/26/2018

Lumentum Holdings Inc. - 15.66% off its 52wkH on 03/12/2018, reports earnings on 08/07/2018

Micron Technology, Inc. - 13.75% off its 52wkH on 03/13/2018, reports earnings on 06/22/2018

ON Semiconductor Corporation - 12.55% 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.

Amgen Inc (AMGN) has advanced 1.46% prior to the open on news that the FDA has approved the company’s Aimovig branded drug, intended to prevent migraines. Aimovig is the first FDA-approved drug that works by blocking molecules that cause migraines.

Applied Materials (AMAT) shares are 5.11% lower pre-market after the company missed earnings estimates yesterday, and the stock was downgraded to neutral at Goldman Sachs with a price target lowered to $58 from $65.

AstraZeneca (LSE:AZN) released 1Q2018 EPS of $0.48, which was lower than anticipated ($0.57 projected).

IQVIA’s (IQV) stock is trading 4.26% higher before the open after the company announced it would not proceed with a 2nd public offering. IQVIA planned to sell 10 million shares.

Lloyds Banking Group Plc (LSE:LLOY) has agreed to sell $5.8 billion worth of Irish residential mortgages to Barclays Plc (LSE:BARC), as Lloyds continues to exist the Irish market.

Mattel’s (MAT) shares are up 3.73% pre-market after the company reportedly informed MGA Entertainment that Mattel was not interested in further merger negotiations. Mattel rejected a merger offer made by MGA Entertainment on April 28.

Nordstrom (JWN) has declined by more than 7% before the start of trading. Nordstrom’s comparable sales for 1Q2018, reported yesterday, rose 0.6% q/q which was below expectations of a 1% q/q growth rate.

Skyworks (SWKS) has been downgraded to a market perform rating at Raymond James. Skyworks’ shares are 1.70% lower pre-market.

Ubisoft (ENXTPA:UBI) released FY2017-2018 EPS that was firmly above expectations (€1.80 vs €1.56 projected). Ubisoft’s stock is trading 5.06% after beating earnings. 

Vivendi SA (ENXTPA:VIV) is reportedly considering the possibility of an initial public offering for its subsidiary Universal Music Group.

Cryptocurrencies Today

Stock Movers

Conviction Buy Winners and Losers

Source: S&P Capital IQ

Winners  Ticker Sector Industry 1 Day Return 5 Day Return  YTD
Marathon Petroleum Corporation MPC Energy Oil and Gas Refining and Marketing 5.19% 4.37% 22.32%
Express Scripts Holding Company ESRX Healthcare Healthcare Services 3.55% 4.88% 2.29%
Raymond James Financial, Inc. RJF Financials Investment Banking and Brokerage 2.33% 5.23% 10.48%
Kirby Corporation KEX Industrials Marine 1.74% 0.28% 35.40%
US Foods Holding Corp. USFD Consumer Staples Food Distributors 1.67% 5.25% 12.34%
 
Losers Ticker Sector Industry 1 Day Return 5 Day Return  YTD
Micron Technology, Inc. MU Information Technology Semiconductors -3.19% 5.56% 18.96%
The Kraft Heinz Company KHC Consumer Staples Packaged Foods and Meats -2.07% -1.99% 2.98%
The Progressive Corporation PGR Financials Property and Casualty Insurance -2.03% -3.32% 0.12%
Lam Research Corporation LRCX Information Technology Semiconductor Equipment -1.73% 0.88% 9.87%
Darden Restaurants, Inc. DRI Consumer Discretionary Restaurants -1.33% -4.42% -6.77%
Conviction Short Winners and Losers
Winners Ticker Sector Industry 1 Day Return 5 Day Return  YTD
Nektar Therapeutics NKTR Healthcare Pharmaceuticals -7.66% -0.26% -5.30%
Sage Therapeutics, Inc. SAGE Healthcare Biotechnology -5.26% -2.80% 14.19%
Blueprint Medicines Corporation BPMC Healthcare Biotechnology -5.19% 0.48% 6.75%
Rite Aid Corporation RAD Consumer Staples Drug Retail -5.06% 4.97% 1.20%
Energous Corporation WATT Industrials Electrical Components and Equipment -3.50% -2.24% -0.17%

 

Losers Ticker Sector Industry 1 Day Return 5 Day Return  YTD
Williams Partners L.P. WPZ Energy Oil and Gas Storage and Transportation 7.99% 10.67% 6.99%
Immunomedics, Inc. IMMU Healthcare Biotechnology 7.12% 10.06% 29.33%
Sangamo Therapeutics, Inc. SGMO Healthcare Biotechnology 6.98% 4.89% -1.83%
PBF Energy Inc. PBF Energy Oil and Gas Refining and Marketing 5.49% 7.51% 25.25%
Axon Enterprise, Inc. AAXN Industrials Aerospace and Defense 5.14% -0.24% 115.55%

Source: S&P Capital IQ

Events Calendar

 

Company Name Ticker Event Date Event Type Q-Factor Score
Campbell Soup Company CPB 5/18/2018 Earnings Release Date US Large-Cap: C, US Consumer Staples: B
Deere & Company DE 5/18/2018 Earnings Release Date US Large-Cap: C, US Industrials: B
Kingboard Chemical Holdings Limited SEHK:148 5/18/2018 Estimated Earnings Release Date China All-Cap: D
China Resources Gas Group Limited SEHK:1193 5/18/2018 Estimated Earnings Release Date China All-Cap: B
YiChang HEC ChangJiang Pharmaceutical Co., Ltd. SEHK:1558 5/18/2018 Estimated Earnings Release Date China All-Cap: B
Kingboard Laminates Holdings Limited SEHK:1888 5/18/2018 Estimated Earnings Release Date China All-Cap: C
China Traditional Chinese Medicine Holdings Co. Limited SEHK:570 5/18/2018 Estimated Earnings Release Date China All-Cap: B
Nordson Corporation NDSN 5/21/2018 Earnings Release Date US Large-Cap: A, US Industrials: B
Pure Storage, Inc. PSTG 5/21/2018 Earnings Release Date US Large-Cap: F, US Information Technology: D
ChinaNet Online Holdings, Inc. CNET 5/21/2018 Estimated Earnings Release Date China All-Cap: D
YY Inc. YY 5/21/2018 Estimated Earnings Release Date China All-Cap: A
Zai Lab Limited ZLAB 5/21/2018 Estimated Earnings Release Date China All-Cap: F
Dycom Industries, Inc. DY 5/21/2018 Estimated Earnings Release Date US Large-Cap: D, US Industrials: D
The TJX Companies, Inc. TJX 5/21/2018 Earnings Release Date US Large-Cap: B, US Consumer Discretionary: A
Urban Outfitters, Inc. URBN 5/21/2018 Earnings Release Date US Large-Cap: C, US Consumer Discretionary: C
Hewlett Packard Enterprise Company HPE 5/21/2018 Estimated Earnings Release Date US Large-Cap: C, US Information Technology: A
Cracker Barrel Old Country Store, Inc. CBRL 5/21/2018 Estimated Earnings Release Date US Large-Cap: C, US Consumer Discretionary: A
Pentamaster International Limited SEHK:1665 5/21/2018 Earnings Release Date China All-Cap: C
Ceridian HCM Holding Inc. CDAY 5/21/2018 Estimated Earnings Release Date US Large-Cap: F
Eaton Vance Corp. EV 5/21/2018 Estimated Earnings Release Date US Large-Cap: B
SIG plc SHI 5/21/2018 Estimated Earnings Release Date China All-Cap: A
Fanhua Inc. FANH 5/21/2018 Earnings Release Date China All-Cap: B