Morning Preview: March 29th, 2017

eOptionDaily Market Report

U.S. stock futures are struggling for direction after solid gains on Tuesday, as stocks climbed amid a rebound in financials and a rally in energy and materials companies. Financial shares jumped over 1% for its biggest advance since March 1st while energy and materials stocks were each up at least 1% following a gain over 1.3% for WTI crude. Meanwhile the volatility index (VIX) slipped for a third day. Markets are keeping an eye out for Federal Reserve speeches, as well as tracking the U.K.’s invocation of Article 50, which officially starts that country’s withdrawal from the European Union. Stocks were buoyed yesterday after a reading of consumer confidence came in better than expected, rising to 16-year highs. With yesterday’s gains, the S&P has cut its month-to-date loss to 0.2%, as of Tuesday’s, close (in the final week of trading for the month/quarter). The broad benchmark stands 1.6% below its March 1 all-time closing high. The British Pound is lower ahead of the Brexit day. In Asian markets, The Nikkei Index gained 14 points to 19,217, the Shanghai Index fell -11 points to 3,241 and the Hang Seng Index rose 46 points to 24,392. In Europe, the German DAX is up over 40 points at 12,190, while the FTSE 100 slipped a few points to 7,330.

Market Closing Prices Yesterday
  • The S&P 500 Index jumped 16.98 points, or 0.73%, to 2,358.57
  • The Dow Jones Industrial Average rose 150.52 points, or 0.73%, to 20,701.50
  • The Nasdaq Composite gained 34.77 points, or 0.60%, to 5,875.14
  • The Russell 2000 Index advanced 9.94 points, or 0.73% to 1,367.26
Events Calendar for Today
  • 7:00 AM ET MBA Mortgage Applications Data
  • 9:20 AM ET Fed’s Evans speaks on Economy and Policy in Frankfurt
  • 10:00 AM ET Pending Home Sales MoM for February…est. 2.5%
  • 10:30 AM ET Weekly DOE Inventory Data
  • 11:30 AM ET Fed’s Rosengren speaks at Economic Club in Boston
  • 1:00 PM ET U.S. Treasury to sell $34B in 5-year notes
  • 1:15 PM ET Fed’s William speaks to Forecaster’s Club of NY
World News
  • Investor Intelligence poll shows bullish sentiment fell to 49.5%, the lowest since Nov. 9, versus 56.7% last week; the fall below 50% ends 18-week streak of readings above that mark, peaked at 30-year high of 63.1% on March 1; bearish sentiment rises to 18.1%, highest since Jan. 11, vs 17.3% last week; those expecting a correction rises to highest since Nov. 2 to 32.4% vs 26.0% last week
  • The British pound declined, slipping as much as 0.5% to $1.2385, its lowest intraday level versus the greenback since March 21, before recovering to trade recently at $1.2422, still down from $1.2456 late Tuesday, as investors braced for formal Brexit procedures to be triggered by the U.K. government later in the day.
  • British consumers borrowed GBP1.4 billion ($1.7 billion), net of repayments, in February, in personal loans, overdrafts and on credit cards, keeping the annual rate of growth in consumer credit steady at 10.5%.
Sector News Breakdown


  • Sonic (SONC) Q2 EPS 15c/$100.16M vs. est. 14c/$104.97M; 2Q franchise comp sales -7.3% vs. est. -4.5%; 2Q system-wide comp. sales -7.4% vs. est. -4.5%; 2Q company-owned comp. sales -8.9%, vs. est. -4.8% and reaffirms year growth
  • RH (RH) Q4 EPS 68c/$586.7M in-line with prelim ests.; sees 1Q EPS 2c-6c on revs $530M-$545M vs. est. 6c/$485.1M; sees FY EPS $1.78-$2.19 vs. est. $1.92; sees FY net revs growth in range of 8% to 12%
  • Dave & Buster’s (PLAY) Q4 EPS 63c/$270.2M vs. est. 59c/$269.77M; Q4 comp sales increased 3.2% vs. est. 3.7%; Q4 EBITDA increased 16.5% to $74.5M from $63.9M; sees year revs $1.16B-$1.17B vs. est. $1.16B
  • Ollie’s Bargain Outlet (OLLI) Q4 EPS 39c/$283.4M vs. est. 36c/$281M; Q4 comparable store sales increased 2% (in-line w/ests); sees FY17 EPS $1.12-$1.15 on revs $1.03B-$1.035B, vs. est. $1.09/$1.03B; sees FY comp sales +1% to +2%
  • Laureate Education (LAUR) Q4 EPS 27c/$1.18B vs. est. 12c/$1.16B; 4Q total student enrollment 1.04M, 4Q Ebitda $285M; sees FY17 revs $4.29B-$4.35B vs. est. $4.21B; sees FY17 total enrollments 1.06M-1.08M, up 2.0-3.5%


  • The American Petroleum Institute (API) reported a rise of 1.9 million barrels in U.S. crude supplies for the week ended March 24, a decline of 1.1 million barrels in gasoline supplies and a fall of 2.0 million barrels in distillates
  • Westmoreland (WLB) Q4 EPS loss (41c)/$392.7M; reports adjusted EBITDA of $89.1M; sees 2017 Ebitda $280M-$310M and free cash flow $115M-$140M


  • The European Union’s antitrust watchdog formally blocked the planned $28 billion tie-up between Deutsche Borse AG and London Stock Exchange Group PLC after the parties failed to offer sufficient remedies to assuage antitrust concerns
  • WR Berkley (WRB) estimates $30M pre-tax or $22M after-tax impact on 1Q operating results from the Ogden rate change
  • Athene Holding (ATH) 27.5M share Secondary priced at $48.50
  • Capital One (COF) upgraded to Buy from Neutral at Nomura
  • Eagle Bancorp (EBMT) files $50M mixed securities shelf


  • Vertex Pharmaceuticals Inc. (VRTX) said it would seek regulatory approval for one of its experimental cystic-fibrosis drugs after the treatment met endpoints in two late-stage clinical studies and helped improve patients’ lung function in late-stage studies. Vertex said it would file for approval in the third quarter to sell the drug in the U.S. and European Union. If approved, the drug would present patients with an alternative to Vertex’s drug Orkambi
  • Depomed (DEPO) sees Q1 revenue $95M-$100M, below consensus $114.64M which reflects impact of sales force realignment, significant openings in field sales force, wholesalers’ reductions of inventory, weakness in opioid markets
  • Depomed (DEPO) and activist investor Starboard Value LP have reached an agreement on new leadership for the company. Former Bayer Healthcare CEO Arthur Higgins has been appointed President & CEO
  • Pernix Therapeutics Holdings (PTX) said it continues to analyze various alternatives, including strategic and refinancing alternatives, asset sales, and mergers and acquisitions to improve financial flexibility
  • Asterias (AST) Q4 EPS loss (20c)/$1.8M vs. est. loss (16c)/$2.61M; reports cash and equivalents totaled $19.8M as of December

Industrials & Materials

  • Landec (LNDC) reiterates Q3 EPS guidance of 16c-19c and revs $133M-$140M vs. est. 18c/$135.86M; said guidance excludes the $2.1M additional legal settlement charge

Technology, Media & Telecom

  • Westinghouse Electric Co., a major player in global nuclear construction, filed for bankruptcy protection on Wednesday, its Japanese parent Toshiba Corp. said, raising questions about the fate of four half-finished reactors in the U.S
  • MaxLinear (MXL) to acquire Exar (EXAR) for $13 per share in cash, or about $700M which represents 22% premium over EXAR’s $10.62 close on March 28
  • Apple’s (AAPL) stock climbs to fifth record in March, and 11th record this year
  • Verint (VRNT) Q4 EPS 90c/$295.9M vs. est. 86c/$294.61M; said Q4 revenue increased 8% sequentially and 6% year-over-year on a constant currency basis
  • SITO Mobile (SITO) Q4 EPS loss (7c)/$7.46M vs. est. loss (2c)/$8.5M


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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