Friday, January 19, 18
Stock futures are moving higher, helped after the US House of Representatives on Thursday passed a stop-gap bill to fund federal agencies beyond Friday night but the measure to avoid a looming government shutdown still faces opposition in the Senate. The Senate adjourned without a final vote late on Thursday and will reconvene at 11 a.m. Eastern Time on Friday. The current interim funding bill that was passed in December expires at 12:01 a.m. Eastern Time, on Saturday. U.S. futures seemed unphased by the possible shutdown, as markets rebound after declines yesterday, falling rom all-time highs. For the week, the Dow is poised to gain 0.8%, while the S&P 500 is set to rise 0.4% and the Nasdaq 0.5%, with Friday’s session to go. The dollar appears spooked by the shutdown uncertainty as the dollar index slides back near three-year lows. Oil prices slipped after the IEA said it sees “explosive” growth in U.S. oil supply this year and boosted their outlooks for American production. The yield on 10-year yield rose above 2.62%, topping the 2017 high. In Asian markets, The Nikkei Index gained 44 points to settle at 23,808, the Shanghai Index rose 13 points to end at 3,487 and the Hang Seng Index gained 132 points to settle at 32,254. In Europe, the German DAX is up over 130 points at 13,420, while the FTSE 100 is up around 20 points at 7,720.
Market Closing Prices Yesterday
· The S&P 500 Index dropped -4.53 points, or 0.16%, to 2,798.03
· The Dow Jones Industrial Average fell -97.84 points, or 0.37%, to 26,017.81
· The Nasdaq Composite slipped -2.23 points, or 0.03%, to 7,296.05
· The Russell 2000 Index declined -9.93 points, or 0.63% to 1,576.73
Events Calendar for Today
· 10:00 AM EST University of Michigan Sentiment, Jan-P…est. 97.0
· 1:00 PM EST Baker Hughes Weekly Rig Count
· Earnings Before the Open: CFG, FHN, KSU, RF, SLB, STI, SYF
· The House on Thursday passed a one-month spending bill that would keep the government funded through Feb. 16, but the stopgap measure currently doesn’t have enough support to clear the Senate. The current interim funding bill that was passed in December expires at 12:01 a.m. Eastern Time, on Saturday.
· U.K. retail sales fell steeply on the month in December, as the Office for National Statistics said sales fell by 1.5% compared with the previous month.
Sector News Breakdown
· The International Energy Agency (IEA) raised its outlook for U.S. crude supply this year by 260,000 barrels a day, to a record 10.4 million barrels a day, largely a result of the recent rally in crude prices.
· The IEA said surging U.S. crude oil production this year is expected to surpass output in Saudi Arabia and rival that of Russia, the world’s two largest oil producers
· Nine Energy Services (NINE) 7M share IPO priced at $23.00
· American Express (AXP) Q4 adjusted EPS $1.58/$8.84B vs. est. $1.54/$8.72B; 4Q total expenses $6.2B and 4Q provision for loan losses $833M; sees FY adjusted EPS $6.90-$7.30 vs. estimate $7.38; Q4 U.S. Consumer Services up 13% to $3.4B; suspending buyback program for first half of 2018 to “rebuild our capital” due to “the upfront charge triggered by the Tax Act” ($2.6B charge)
· SunTrust (STI) Q4 EPS with items $1.48 on revs $2.27B vs. est. $2.31B; said Q4 EPS includes 39c per share of net discrete benefits from Form 8-K items announced on December 4, 2017 and the impacts of tax reform-related items
· Synchrony Financial (SYF) Q4 EPS 70c vs. est. 64c; 4Q net interest margin 16.2%; 4Q loan receivables growth +7%; 4Q deposit growth +9%; 4Q net charge-offs $1.14B
· Regions Financial (RF) Q4 EPS 27c/$1.48B vs. est. 26c/$1.44B; Q4 net interest margin 3.32%
· Citizens Financial (CFG) Q4 EPS $1.35 with items on revs $1.5B
· People’s United (PBCT) Q4 operating EPS 31c vs. est. 27c; Q4 net interest margin increased three basis points from 3Q17 to 3.07%; 4Q return on average assets 0.96% and ROE 7.4%
· Independent Bank (INDB) Q4 EPS 89c (in-line with ests); Q4 tangible book value per share $25.60, net interest income $67.8M, Q4 net charge-offs ratio 0.02% and Q4 provision for loan losses $1.3M
· BancFirst (BANF) Q4 EPS 59c vs. est. 69c; 4Q net interest margin 3.48%; 4Q provision for loan losses $3.32M
· First Financial (FFBC) Q4 EPS 40c (in-line with ests); 4Q NIM on taxable-equivalent basis 3.82% vs. est. 3.62%; Q4 return on average assets 1.13% and return on average equity 10.7%
· MoneyGram (MGI) announced the launch of new global customer verification standards for all sends and receives
· Americold Realty Trust (COLD) 45.3M share IPO priced at $16.00
· AstraZeneca PLC (AZN) said that two new drugs, its Lynparza tablets for advanced ovarian cancer and its Fasenra treatment for bronchial asthma, have received approval from Japanese authorities.
· FDA approved extension of indications for Qiagen ’s (QGEN) therascreen EGFR RGQ PCR kit as a companion diagnostic in treatment of metastatic non-small cell lung cancer
· HTG Molecular (HTGM) 12M share Secondary priced at $2.90
· UroGen Pharma (URGN) 1.463M share Secondary priced at $41.00
Industrials & Materials
· Canadian Pacific (CP) Q4 adjusted EPS C$3.22/C$1.71B vs. est. C$3.20/$1.7B; Q4 operating ratio 56.1%; sees FY adjusted EPS growth to be in low double-digits
· Genesee & Wyoming (GWR) Dec. carloads fell -5.7%; Dec. traffic of 255,199 carloads and same-railroad traffic in Dec. was 254,700, down 5.9% YoY
Technology, Media & Telecom
· IBM Corp (IBM) Q4 EPS $5.18/$22.5B vs. est. $5.17/$22.05B; says tax reform act resulted in one-time $5.5B charge in Q4; said strategic imperatives revenue again grew at a double-digit rate and now represents 46% of total revenue; Q4 Cognitive solutions revenue $5.4B, up 3%, Global Business Services revenue $4.2B, up 1%, Q4 Technology Services and Cloud Platforms revenue $9.2B, down 1%; breaks its 22-quarter streak of declining revs, as per CNBC
· Mellanox (MLNX) Q4 EPS 82c/$237.6M vs. est. 68c/$235.47M; sees Q1 revenue $222M-$232M vs. est. $220.3M; sees Q1 adjusted operating expenses $120M-$122M and gross margins 68.5%-69.5%; sees FY18 revenue $970M-$990M vs. est. $971M
· Atlassian (TEAM) Q2 EPS 13c/$212.6M vs. est. 12c/$204.5M; sees 3Q non-IFRS EPS 8c on revs $217M-$219M vs. est. 11c/$215.5M; sees FY non-IFRS EPS 47c-48c on revs $853M-$857M vs. est. 47c/$845.2M
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.