Morning Wrap

eOptionDaily Market Report

U.S. stock futures are trading slightly lower, led by weakness in the energy complex, as WTI crude extended its declines from Wednesday. Crude prices have suddenly turned sharply lower as WTI falls below $49 for the first time this year and toward its lowest close since late November. The contract dropped around 3% to a low of $48.79 a barrel this morning after settling lower by 5.4% yesterday for its worst one-day showing in more than a year after data from the EIA showed inventories rose by 8.2M barrels for its ninth straight weekly increase. Overall, stocks ended little changed yesterday, as the S&P and Dow slipped for a third straight day, while the NASDAQ closed higher. On the calendar today, the ECB monetary policy meeting at 7:45 and press conference at 8:30 which could move currency markets. But all eyes on the non-farm payroll report tomorrow after yesterday’s much better than expected ADP employment report lifted the dollar and weighed on bonds. U.S. Treasury prices finished lower yesterday, with the benchmark 10-year yield closing 4 bps higher at 2.55% after touching highs of around 2.58%. In Asian markets, The Nikkei Index gained 64 points to 19,318, the Shanghai Index…the Hang Seng Index fell -280 points to 23,501. In Europe, markets are lower as the German DAX is off about -30 points to around 11.930, while the FTSE 100 drops over -50 points.

Market Closing Prices Yesterday

· The S&P 500 Index dropped -5.41 points, or 0.23%, to 2,362.98
· The Dow Jones Industrial Average fell -69.03 points, or 0.33%, to 20,855.73
· The Nasdaq Composite gained 3.62 points, or 0.06%, to 5,837.55
· The Russell 2000 Index declined -8.84 points, or 0.64% to 1,366.04

Events Calendar for Today

· 7:45 AM ET European Central Bank (ECB) policy decision/press conference at 8:30 AM
· 8:30 AM ET Weekly Jobless Claims…est. 238K
· 8:30 AM ET Continuing Claims…est. 2.062M
· 8:30 AM ET Import Prices MoM for February…est. 0.1%
· 9:45 AM ET Bloomberg Consumer Comfort Index…prior 49.8
· 10:30 AM ET Weekly EIA Natural Gas Inventory Data
· 12:00 PM ET Change in Household Net Worth for Q4

World News

· Chinese financial institutions issued 1.17 trillion yuan ($169.30 billion) of new yuan loans in February, down sharply from CNY2.03 trillion in January, data from the People’s Bank of China showed

Sector News Breakdown
Consumer

· United Airlines (UAL) Feb 2017 consolidated traffic (revenue passenger miles) decreased 0.8 % and consolidated capacity (available seat miles) decreased 0.4% YoY; Feb 2017 consolidated load factor decreased 0.3% compared to February 2016; load factor 76.7% vs 77.0% YoY

· United Natural Foods (UNFI) Q2 EPS 50c/$2.29B vs. est. 50c/$2.33B; expects to incur restructuring charges of between $3.5M-$4M, before taxes, primarily related to expenses for severance and other employee separation costs; cuts FY17 adjusted EPS view to $2.53-$2.58 from $2.53-$2.63 (est. $2.54) and cuts FY17 revenue view to $9.38B-$9.46B from $9.43B-$9.6B (est. $9.41B)

· Staples (SPLS) Q4 EPS 25c vs. est. 26c; Q4 total company comp sales down (-0.9%); sees Q1 EPS 15c-18c vs. est. 17c; plans to close about 70 stores in North America in 2017

· Amplify Snack (BETR) Q4 EPS 9c/$88.6M vs. est. 10c/$87.4M; sees 2017 net sales $404M-$420M vs. est. $404M; sees 2017 EPS 43c-51c below est. 56c

· Tailored Brands (TLRD) Q4 EPS loss (19c)/$793.26M vs. est. loss (12c)/$811.3M; sees FY17 EPS $1.45-$1.75, below consensus $2.10; reports Q4 Men’s Warehouse comp store sales down (-2.2%), Jos A Bank comps +3.6%

· e.l.f. Beauty (ELF) Q4 EPS 19c/$76.4M vs. est. 13c/$74.51M; says with strength across leading national retailers and our direct business, we expect net sales growth in 2017 of 24% to 28%; sees FY17 EPS 40c-43c on revs $285M-$295M vs. est. 37c/$281.32M

· J.Jill (JILL) 11.7M share IPO priced at $13.00

· Stanley Black & Decker (SWK) sees 2017 adj. EPS $6.74-$6.94 vs prior view $6.85-$7.05 after completing purchase of Craftsman brand from Sears Holding

· Sear’s Holding (SHLD) Q4 EPS loss (1.28) vs. est. (2.85); said are pursuing options for its Kenmore and Die Hard brands

· Camping World (CWH) Q4 EPS 14c/$670.0M vs. est. 9c/$678.7M

· Smart & Final Stores (SFS) Q4 EPS 7c/$1.00B vs. est. 10c/$1.04B

Energy

· Royal Dutch Shell PLC (RDSA) is selling nearly all of its Canadian oil-sands developments in deals worth $7.25 billion, pulling out of the region after its biggest rival, Exxon Mobil Corp. (XOM), signaled that production was unprofitable in the region at today’s prices https://goo.gl/mwc1ho

· Energous (WATT) Q4 EPS loss (75c) vs. est. loss (54c); reports Q4 revenue $130K and Q4 adjusted EBITDA loss of $10.2M

Financials

· Franklin Resources, Inc. (BEN) reported preliminary month-end assets under management by the company’s subsidiaries of $738.2 billion at February 28, 2017, compared to $728.8 billion at January 31, 2017, and $714.0 billion at February 29, 2016

· Bankrate (RATE) Q4 EPS 16c/$113.6M vs. est. 19c/$120.2M; sees 1Q revs $115M-$118M vs. est. $114M; sees 1Q Ebitda $26M-$28M; sees FY revs $500M-$515M vs. est. $498.4M

· Citizens Inc. (CIA) said it strongly disagrees with assumptions, conclusions in blog post, says it contains numerous false, misleading statements

Healthcare

· Apricus Biosciences, Inc. (APRI) completed the sale to Ferring International Center of its ex-U.S. assets and rights related to Vitaros®, Apricus’ on-demand topical cream indicated for the treatment of patients with erectile dysfunction pursuant to a definitive agreement with Ferring.

· Vivus (VVUS) Q4 EPS 54c/$81.8M vs. est. 23c/$48.8M

· Tandem Diabetes (TNDM) Q4 EPS loss (48c)/$28.9M vs. est. (65c) loss; sees year sales $100M-$107M vs. est. $103.7M; files to sell $57.5M in shares

· Turtle Beach (HEAR) Q4 EPS 25c/$82.2M vs. est. 17c/$83.51M; sees Q1 loss (26c)-(24c) on revs $12M-$13M vs. est. loss (17c)/$20.66M

· Spectrum (SPPI) Q4 EPS loss(23c)/$35.2M vs. est. loss (27c)/$31.13M

· Editas Medicine (EDIT) files to sell 800K shares of common stock for shareholders

· BioCryst (BCRX) files to sell $45M shares of common stock

· TG Therapeutics (TGTX) files to sell common stock, no amount given

Industrials & Materials

· Dutch paints and chemicals maker Akzo Nobel NV rejected an unsolicited EUR20.9B ($22.1 billion) offer from U.S. peer PPG Industries Inc. (PPG) https://goo.gl/wFEjME

· Orbital ATK (OA) upgraded to Outperform with $108 target at Cowen

· Patrick Industries (PATK) 1.35M share Secondary priced at $73.00

Technology, Media, & Telecom

· Semtech (SMTC) Q4 EPS 37c/$140M vs. est. 35c/$138.3M; sees 1Q EPS 39c-43c on sales $138.0M-$146.0M vs. est. 36c/$141.5M

· The KeyW Holding Corp. (KEYW) to acquire Sotera Defense Solutions in an all-cash transaction valued at approximately $235M, inclusive of an expected $46M net present value of acquired tax benefits; also, KEYW Q4 GAAP EPS loss (8c)/$68.9M vs. est. loss (1c)/$72.3M

· Equinix (EQIX) 5.278M share Secondary priced at $360.00

· Comtech Telecom (CMTL) Q2 EPS loss (28c)/$139M vs. est. loss (12c)/$136.2M; sees FY revs $570.0M-$580.0M vs. est. $595.4M

· Xactly (XTLY) Q4 EPS loss (5c)/$24.3M vs. est. loss (12c)/$24M; sees 1Q revs $23.8M-$24.8M, vs. est. $26.4M and EPS loss (7c-10c) vs. est. loss (11c)

· Sinclair Broadcast (SBGI) files to sell 12M shares of Class A common stock

Market commentary provided by Hammerstone Markets, a division The Hammerstone Group, a firm separate from and not affiliated with Regal Securities L.P. Regal Securities L.P. has not participated in the creation of the content, and does not explicitly or implicitly endorse the content.

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