Morning Preview: November 14, 2017

Scott GreenDaily Market Report

Early Look
Tuesday, November 14, 17
  
U.S. stock futures are flat to down slightly, remaining in a tight holding pattern not far from its record all-time best levels, as pullback fears continued to cast a shadow as markets keep watchful eye on any relevant news about U.S. tax reform plans. Today a big day for macro speakers, as Federal Reserve Chairwoman Janet Yellen joined her European and Japanese counterparts on a discussion panel in Frankfurt. Comments are expected from other Fed speakers, as investors listen out for hints on the path for U.S. interest rates. Short-dated Treasury yields jumped Monday as markets extend bets that the central bank would raise rates in December even in the absence of stronger inflation numbers; the two-year note yield rose 2.9 bps to 1.687%, its highest since Oct. 20. 2008, though the 10-yr note yield was unchanged at 2.40%. In corporate news, Dow component Home Depot (HD) reported better than expected quarterly results this morning, expected after the impact from the hurricanes.
 
In Asian markets, The Nikkei Index was flat on the night at 22,380, the Shanghai Index dropped -18 points to 3,429, and the Hang Seng Index dipped -30 points to 29,152. In Europe, the German DAX is up a few points at 13,080, while the FTSE 100 is higher by a few points at 7,430. Overall, major European stock indexes slipped with the regional benchmark headed for a sixth straight loss, as the euro hit its highest level in three weeks on the back of stronger-than-expected German economic growth figures. The euro climbed above $1.1700 against the dollar for the first time since Oct. 26.
 
Events Calendar for Today
·      3:05 AM EST       Fed’s Evans speaks at ECB Conference in Frankfurt
·      5:00 AM EST       Fed’s Yellen speaks on ECB Panel with Draghi, Kuroda and Carney
·      6:00 AM EST       NFIB Small Business Optimism for October…est. 104.0
·      7:45 AM EST       ICSC Weekly Retail Sales
·      8:15 AM EST       Fed’s Bullard speaks on Economy in Louisville
·      8:30 AM EST       Producer Price Index (PPI) MoM for Oct…est. 0.1%
·      8:30 AM EST       PPI Ex: Food & Energy MoM for October…est. 0.2%
·      8:55 AM EST       Johnson/Redbook Weekly Sales
·      1:05 PM EST        Fed’s Bostic speaks on Economic Outlook and Monetary Policy
·      4:30 PM EST        API Weekly Inventory Data
 
Market Closing Prices Yesterday
·      The S&P 500 Index gained 2.54 points, or 0.10%, to 2,584.84
·      The Dow Jones Industrial Average rose 17.49 points, or 0.07%, to 23,439.70
·      The Nasdaq Composite climbed 6.66 points, or 0.10%, to 6,757.60
·      The Russell 2000 Index dipped -0.21 points, or 0.01% to 1,475.07
 
Other Key Events
·      JP Morgan Global Tech, Media and Technology Conference, 11/13-11/14, in Hong Kong
·      UBS Global Technology Conference, 11/13-11/15, in San Francisco
·      Goldman Sachs Industrials conference, 11/14-11/15, in Boston
·      JP Morgan Ultimate Services Conference, 11/14, in NY
·      Morgan Stanley Consumer Conference, 11/14-11/15, in NY
 
World News
·      German Gross domestic product (GDP) grew at an annualized rate of 3.3%, compared with 2.6% in the second quarter, the Federal Statistical Office, Destatis, said, topping forecasts of 2.4% growth. In addition, Destatis significantly lifted its GDP growth estimate for the first quarter to an annualized rate of 3.6% from an earlier estimate of 2.9%.
·      German ZEW economic expectations at 18.7 in November vs. 17.6 in October
·      German ZEW current conditions 88.8 in November vs. 87.0 in October
·      U.K. inflation remained unchanged in October to stay at a five-year high, but growth in raw material prices slowed sharply. Consumer prices grew 3% in October, unchanged from the previous month, but still recorded the joint-fastest annual increase since March 2012.
 
Sector News Breakdown
Consumer
·      Buffalo Wild Wings Inc. (BWLD) has received a takeover bid valued at more than $2.3 billion from private-equity firm Roark Capital Group, according to people familiar with the matter; Roark made an offer of more than $150 a share in recent weeks https://goo.gl/ZXL9gq
·      Home Depot (HD) Q3 EPS $1.84/$25B vs. est.$1.82/$24.53B; Q3 comp sales rose 7.9% vs. est. 5.4%; Sees FY EPS $7.36, up from prior $7.29 and vs. estimate $7.34; raises year comp sales view to +6.5% from +5.50% and sees FY revenue +6.3%, from +5.30%; says underlying health of core business ‘remains solid’
·      Advance Auto Parts (AAP) Q3 EPS $1.43/$2.18B vs. est. $1.21/$2.21B; sees FY comparable sales -1% to -3% after Q2 comps fell (-3.4%) vs., estimate (-2%); reaffirms Full Year 2017 Guidance; backs FY17 new stores view of 60-65 and backs FY17 CapEx view approximately $250M
·      Acushnet Holdings (GOLF) 8.3M share Secondary priced at $17.00
·      Aramark (ARMK) raises dividend to 10.5c from 10c; Q4 EPS 54c/$3.65B vs. est. 57c/$3.7B; sees year EPS $2.10-$2.20 vs. est. $2.20
·      Inter Parfums (IPAR) provides initial 2018 guidance EPS of $1.40 vs. est. $1.45 and sales $620M vs. est. $618.5M
·      Famous Dave’s (DAVE) Q3 adjusted EPS loss (1c)/$21.9M vs. est. loss (5c)/$21.48M; Q3 franchise-operated comparable restaurant sales improved to (2.1%) from (3.8%) in Q3; raises $1.5M in a private placement
 
Financials
·      French insurance company AXA SA has filed preliminary documents for an initial public offering of its U.S. life-insurance operations. Following the planned IPO, the portion of the AllianceBernstein business not controlled by AXA would remain a separate publicly traded entity.
·      IHS Markit (INFO) backs FY17 adjusted EPS view $2.02-$2.08 vs. est. $2.05 and backs FY17 revenue view $3.49B-$3.56B vs. consensus $3.56B; sees FY18 adjusted EPS $2.17-$2.23 on revs $3.77B-$3.83B vs. est. $2.27/$3.78B
 
Healthcare
·      Cellectis (CLLS) Q3 EPS loss (73c)/$7.253M vs. est. loss (58c)/$10.55M
·      Sage Therapeutics (SAGE) files to sell $300M in common stock
·      Myomo (MYO) files to sell common stock and warrants; announced positive results reported by Takeda in two Phase 3 clinical studies of relugolix for the treatment of uterine fibroids
·      Orexigen (OREX) Q3 EPS loss ($1.35) on revs $18.9M
·      Alnylam (ALNY) 5.6M share Secondary priced at $125
 
Industrials & Materials
·      Freeport McMoRan (FCX) has closed an access road to the Grasberg copper mine in Indonesia following a shooting incident on Tuesday, Reuters reports
·      Kansas City Southern (KSU) files automatic mixed securities shelf
 
Technology, Media & Telecom
·      Switch (SWCH) Q3 EPS 8c/$97.7M vs. est. 7c/$95.81M; sees FY17 $372M-$380Mvs. est. $374.58M and sees FY17 adjusted EBITDA $190M-$195M; FY17 CapEx $345M-$365M
·      WideOpenWest (WOW) Q3 EPS 37c/$297.8M vs. est. 20c/$302M; 3Q adjusted Ebitda $114.8M
·      HTC and Google (GOOGL) have canceled the release of the Daydream-branded HTC standalone headset in the U.S. market amid aggressively priced products from Facebook’s (FB) Oculus, TechCrunch reports, citing the companies.

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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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