Stock futures are higher, as financials and insurers rebound overseas, as Hurricane Irma, which has now been downgraded to a Category 1 has left at least 4 million Floridians without power according to reports (and have devastated many areas) but early estimates of damage are being totaled between $15B-$50B, below the figures of over $100B estimates last week. Also easing concerns, North Korea was quiet over the weekend, failing to conduct another missile test over the weekend as some predicted might happen to mark the anniversary of the country’s founding, boosting appetite for stocks. The storm, due to be downgraded to a tropic storm, is expected to hit Tampa and Orlando early Monday and Tallahassee on Monday afternoon, and moving up to Georgia next. Defensive gold and bonds slipped early. In Asian markets, The Nikkei Index jumped 270 points to 19,545, the Shanghai Index gained 11 points to settle at 3,376 and the Hang Seng Index gained 286 points to end at 27,955. In Europe, the German DAX is higher by over 135 points at 12,440, while the FTSE 100 is higher by nearly 50 points at 7,425. The Nikkei bounced back from its worst week in seven months as the Japanese yen weakened. There is also no economic data on the U.S. calendar today.
Market Closing Prices Yesterday
· The S&P 500 Index slipped -3.67 points, or 0.15%, to 2,461.43
· The Dow Jones Industrial Average rose 13.01 points, or 0.06%, to 21,797.79
· The Nasdaq Composite dropped -37.68 points, or 0.59%, to 6,360.19
· The Russell 2000 Index inched higher 0.76 points, or 0.05% to 1,399.43
· No major economic data released today
· Nike (NKE) mentioned cautiously in Barron’s saying shares could fall another 10% as Adidas (ADDYY) picks up the pace. Nike (NKE) is losing ground in the sneaker race, saying Nike’s problem is twofold, namely the growth of e-commerce which has rattled Nike’s retail partners, including Foot Locker (FL), and Adidas that seems to have finally figured out how to sell sneakers in the U.
· S&P SmallCap 600 constituent The Brink’s Co. (BCO) will replace VCA Inc. (WOOF) in the S&P MidCap 400, and ARMOUR Residential REIT Inc. (ARR) will replace Brink’s in the S&P SmallCap 600 effective prior to the open on Monday, September 18
· S&P SmallCap 600 constituent ILG Inc. (ILG) will replace Cadence Design Systems in the S&P MidCap 400, and Meta Financial Group Inc. (CASH) will replace ILG in the S&P SmallCap 600 effective prior to the open on Monday, September 18
· Tesla (TSLA) sent out a free software update temporarily extending the battery life for some of its cars in order to help owners evacuate the looming Irma storm.
· Hurricane Irma has knocked out power to 3.3 million customers, paralyzed tanker traffic and shut about 6,000 gasoline stations. As the storm heads up Florida’s west coast, it’s also threatening more than $1 billion worth of crops
· Callon Petroleum Company Inc. (CPE) will replace WebMD Health Corp. (WBMD) in the S&P MidCap 400 effective prior to the open on Monday, September 18 (KKR is acquiring WBMD)
· Equifax’s (EFX) insurance against cyber breaches is likely inadequate to cover the costs tied to one of the biggest hacks in history, according to Bloomberg, citing people familiar with the matter. The company holds a policy that would probably cover about $100M-$150M
· Private-equity manager Carlyle Group’s (CG) ill-starred move into hedge funds has made its stock look cheap, at 7.2 times estimated 2017 earnings according to Barron’s. Morgan Stanley analyst is most bullish scenario sees it at $40, almost twice last week’s price.
· Whitestone REIT (WSR) will replace CDI Corp. (CDI) in the S&P SmallCap 600 effective prior to the open on Wednesday, September 13 (AE Industrial Partners LLC is acquiring CDI)
· AstraZeneca plc (AZN) shares rose after the drugmaker said a study of its key lung cancer treatment showed stronger-than-expected results in patients whom had not progressed following chemotherapy
· Bristol-Myers Squibb’s (BMY) Opdivo-Yervoy combo cut death risk 37% compared with Pfizer’s Sutent (sunitinib) in intermediate-to-poor-prognosis patients with previously untreated advanced or metastatic kidney cancer.
· Exelixis (EXEL) says Independent Radiology Review Committee confirms primary endpoint analysis per investigator: cabozantinib provided statistically significant improvement of progression-free survival, with 52% cut in rate of progression or death compared to sunitinib
· Teva Pharmaceutical Industries Ltd. (TEVA) named 3-year veteran Kare Schultz as its new chief executive, ending months of speculation over who will lead the Israeli drug company (Schultz joins from Denmark’s H. Lundbeck A/S)
Industrials & Materials
· General Electric (GE) tgt cut to street low $21 at Deutsche Bank
· Air Products (APD) signed pact to form $1.3b joint venture with Lu’An Clean Energy to expand what it supplies to Lu’An Mining’s syngas-to-liquids production in Changzhi in China
· AIR Worldwide estimates industry insured losses in the United States resulting from Hurricane Irma will range from $20 billion to $40 billion
Technology, Media & Telecom
· Apple’s (AAPL) new phone will be called the iPhone X, according to Bloomberg, citing a leak of the company’s latest mobile operating system. Strings of software code inside of the leaked operating system, first detailed by Apple news website 9to5Mac, show the expected three new phones will be called the iPhone 8, iPhone 8 Plus, and iPhone X
· A group including Bain Capital and South Korea’s SK Hynix has raised its offer for Toshiba Corp’s (6502.T) chip business to 2.4 trillion-yen ($22.3 billion) including a 200-billion-yen investment in infrastructure – Reuters reported https://goo.gl/H3yUV8
· Altaba (AABA), the former Yahoo!, trades at a 30% discount to the value of its assets even after a 65% run this year according to Barron’s; says shares look undervalued and could be a cheap way to play Alibaba (BABA), which has a 15% stake
· Viacom’s (VIAB) turnaround looks less likely according to Barron’s citing Wells Fargo analyst who downgraded the stock to perform from outperform amid concern over the media giant’s streaming strategy
· S&P MidCap 400 constituent Cadence Design Systems Inc. (CDNS) will replace Staples Inc. (SPLS) in the S&P 500 (SPLS being acquired by Sycamore Partners)
· New Line Cinema and Warner Bros. (TWX) horror movie “It” smashed September box office records with $117.2M from 4,103 theaters in its North American box-office debut over the weekend. Internationally, “It” also scored the biggest opening ever for a horror title, led by the U.K. $12.3M (watch shares of beaten up movie theatres AMC, CNK, IMAX, RGC)
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.