Morning Preview: May 11th, 2017

eOptionDaily Market Report

U.S. stock futures are slightly lower, currently near their worst levels of the overnight session, with the S&P off around -4 points (overnight highs 2,395.25 and low 2,390.75) as major averages pullback from near all-time levels. Stocks ended little changed on Wednesday, as the U.S. stock market, which remains near record highs (NASDAQ new high yesterday) appear “bulletproof”, as no news, earnings or macro developments seem to dent investor optimism. U.S. stocks opened lower yesterday following President Donald Trump’s firing of FBI director James Comey, but markets bounced back, led by a gain in energy stocks and semiconductors as WTI crude posts biggest advance in more than 5 months on bullish inventory data, while tech was boosted by earnings beats by NVDA and MCHP (leading the semi index to 17-year highs). The VIX index ended around the 10 level after falling to lowest levels since 1993 on Monday. Today a busy morning with retail earnings, and economic data.
Crude futures pushed higher Thursday, extending yesterday’s gains, as markets investors are interpreting the latest hefty decline in U.S. crude inventories to be a harbinger of future demand. Oil prices shot up more than 3% on Wednesday after data from the Energy Information Administration showed U.S. crude stockpiles dropped 5.2 million barrels in the week ended May 5, far exceeding market expectations. The reading marks the biggest weekly drawdown since December.
In Asian markets, The Nikkei Index rose 61 points to settle at 19,961, the Shanghai Index…the Hang Seng Index rose 110 points to close at 25,125. In Europe, the German DAX is down around -10 points, down under 12,750, while the FTSE 100 is flat around 7,380 ahead of the BOE rate decision at 7:00 AM EST.
Market Closing Prices Yesterday
·      The S&P 500 Index gained 2.71 points, or 0.11%, to 2,399.63
·      The Dow Jones Industrial Average fell -32.67 points, or 0.16%, to 20,943.11
·      The Nasdaq Composite climbed 8.56 points, or 0.14%, to 6,129.14
·      The Russell 2000 Index advanced 7.73 points, or 0.56% to 1,399.59
Events Calendar for Today
·      6:25 AM ET          Fed’s Dudley speaks on globalization in Dubai
·      8:30 AM ET          Weekly Jobless Claims…est. 245K
·      8:30 AM ET          Continuing Claims…est. 1.98M
·      8:30 AM ET          Producer Price Index (PPI) MoM for April…est. 0.2%
·      8:30 AM ET          PPI Ex: Food & Energy (core) MoM for April…est. 0.2%
·      9:45 AM ET          Bloomberg Consumer Comfort Index
·      10:30 AM ET       Weekly EIA Natural Gas Inventory Data
Earnings Calendar:
·      Earnings Before the Open: ASUR, EEP, KSS, LINC, M, OA, PBH, RGLD, SND, SNK, SUNW, TPB, VSTO
·      Earnings After the Close: CA, DAR, JAG, JWN, MCFT, SYMX, UPLD
World News
·      The Bank of England Rate decision later this morning – expected to keep rate at 0.25%
·      UK industrial production shrank 0.5% in March, the Office for National Statistics said. This was a slightly slower pace of decline than forecast in a Wall Street Journal poll
·      Bitcoin shoots past $1,800 for the first time, up 4% to $1,818.19
Sector News Breakdown
·      Whole Foods (WFM) Q2 EPS 37c/$3.74B vs. est. 37c/$3.73B; Q2 comparable store sales down (-2.8%) vs. est. (-3.1%); sees FY17 EPS of $1.30 or more vs. est. $1.33 and sees FY17 sales growth of 1% or greater; sees FY17 comps about a negative 2.5% or better
·      e.l.f. Beauty (ELF) Q1 EPS 9c/$60.6M vs. est. 5c/$59.55M; firm said performance is notable given the significant amount of shipments to customers for shelf resets in Q1 2016; reaffirms year
·      Papa Murphy’s (FRSH) Q1 EPS loss (32c)/$32.0M vs. est. loss (7c)/$35.21M; lowers FY17 domestic system-wide comparable store sales growth in the range of -2% to flat, compared to previous guidance of flat to +2%
·      Good Times Restaurants (GTIM) Q2 EPS loss (6c)/$18.24M vs. est. loss (7c)/$18.02M
·      US Foods Holding (USFD) files to sell 35M share shelf for holders
·      DCP Midstream (DCP) Q1 EPS 41c/$2.12B vs. est. 29c/$1.81B; 1Q adjusted Ebitda $245M
·      SandRidge Energy (SD) Q1 EPS 78c/$98.4M vs. est. 25c/$95.1M; Q1 production 4.00 MMBoe; Q1 Ebitda $55.7M
·      Sunrun (RUN) Q1 EPS 12c/$104.12M vs. est. 14c/$119.35M; Q1 total deployments of 73 MW, an increase of 21% YoY and expects to deploy approximately 72 MW in Q2, reflecting approximately 15% growth in the first half of 2017 compared to the prior year
·      Royal Bank of Scotland Group PLC (RBS) said it has raised $3 billion via issue of senior notes to fund the company’s general banking business.
·      Moody’s cuts 6 Canadian Banks on “challenging operating environment” – reflects ongoing concerns that expanding levels of private-sector debt could weaken asset quality in future (TD, BMO, BNS, CM, RY and NA)
·      Ambac Financial (AMBC) Q1 EPS loss ($2.01); Q1 net investment income $81.6M; Q1 adj. book value/share $27.09 and Q1 net premiums earned $47.6M
·      Envestnet (ENV) Q1 EPS 25c/$157.8M vs. est. 24c/$155.56M; sees Q2 adjusted EPS 27c on revs $162.8M-$164.8M vs. est. 31c/$162.1M; raises year revs to $655M-$664M from $650M-$660M
·      CNO Financial (CNO) board approved an additional $300M to repurchase common stock; raised to 9c from 8c
·      MBIA (MBI) Q1 operating EPS 7c vs. est. 4c; 1Q book value per share $24.73
·      Arbor Realty (ABR) files to 9.5M shares of common stock
·      Kinsale Capital Group (KNSL) files to sell 3.3M shares of common stock for holders
·      Merck & Co. (MRK) won accelerated approval for using Keytruda and chemotherapy as a first-line treatment for metastatic non-squamous non-small cell lung cancer
·      Omeros (OMER) Q1 revs $12.3M vs. est. $13.3M; Omidria units sold by wholesalers to customers +14.2% QoQ
·      Bright Horizons (BFAM) files to sell 4.15M shares for holders
·      Hologic (HOLX) Q2 EPS 50c/$715.4M vs. est. 46c/$685.36M; sees FY EPS $1.98-$2.02 vs. est. $1.97 and sees FY revenue $3.05B-$3.08B vs. est. $3.06B
·      Intrexon (XON) Q1 EPS loss (26c)/$53.7M vs. est. loss (24c)/$49.1M; Q1 cash and cash equivalents $69.9M; Q1 R&D expenses $34.2M
·      Sangamo (SGMO) signs pact with Pfizer (PFE) for Hemophilia A gene therapy; SGMO will get $70M upfront payment from Pfizer under exclusive global collaboration and license agreement to develop and market gene therapy programs for hemophilia A, including SGMO’s SB-525
·      Collegium Pharmaceutical (COLL) said based on the company’s current operating plans, it believes that its existing cash resources will fund its operating expenses, debt service and capital expenditure requirements into 2019
·      Medical Transcription Billing (MTBC) announces $2.3M registered direct offering
Industrials & Materials
·      United States Steel (X) announced the retirement of Mario Longhi from the company on June 30, 2017. He stepped down as CEO on May 8, but he will remain on the board of directors and serve as an employee of the company, providing transitional support, until his retirement
·      Orbital ATK (OA) Q1 EPS $1.23/$1.09B vs. est. $1.37/$1/09B; sees FY revenue $4.55B-$4.63B vs. est. $4.60B
·      Royal Gold (RGLD) Q3 EPS 36c/$107.0M vs. est. 38c/$107.8M; 3Q gold production 87,700 equivalent oz.
·      S&W Seed (SANW) Q3 EPS 5c/$21M vs. est. 6c/$27.38M; sees FY17 revenue $82M-$87M, vs. consensus $97.8M and sees FY17 adjusted EBITDA $5.7M-$7.1M
Technology, Media & Telecom
·      Snap (SNAP) shares fall 25%; Q1 revs $149.6M vs. est. $158.6M; said Q1 daily active users (DAUs) 166M (up 36% YoY) vs. est. 168M; Q1 adjusted Ebitda loss (-$188.2M) vs. est. loss (-$176.9M); Q1 ARPU up 181% YoY, down 14% QoQ to 90c
·      Verizon(VZ) agrees to acquire Straight Path Communications (STRP) for $184 a share, or about $3.1B, VZ will pay a $38M termination fee to AT&T (T) who had made prior offer; STRP stock tumbles 21% premarket after Verizon buyout deal (news hitting 6:47 AM)
·      21st Century Fox reports (FOXA) Q3 EPS 54c/$7.56B vs. est. 48c/$7.63B; 3Q TV revenue $1.69B (light of some views) and Q3 Filmed Entertainment revenue $2.26B (beats)
·      Symantec (SYMC) shares fell; Q4 EPS 28c/$1.115B vs. est. 28c/$1.18B; raises year EPS to $1.75-$1.85, from prior $1.70-$1.80 (est. $1.78) and sees year revs $5.10B-$5.20B vs. est. $5.21B
·      Netease (NTES) up 5% overnight; Q1 ADS $4.75/$1.98B vs. est. $4.08/$1.73B
·      LivePerson (LPSN) Q1 EPS 1c/$50.9M vs. est. 1c/$50.42M; backs 2017 adjusted EPS view 7c-12c vs. est. 9c and narrows 2017 revenue view to $204M-$209M from $201M-$209M
·      Pegasystems (PEGA) Q1 EPS 39c/$223.25M vs. est. 23c/$200.6M
·      Synacor (SYNC) Q1 EPS loss (21c)/$26.5M vs. est. loss (21c)/$27.31M
·      ExOne (XONE) Q1 EPS loss (42c)/$10.9M vs. est. loss (27c)/$10.05M
·      KeyW Holding Corporation (KEYW) announced that the company’s Chief Operating Officer, Mark Willard

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

Live Trading

Open an Account

Paper Trading