Morning Preview: March 9, 2018

Scott GreenDaily Market Report

Early Look
Friday, March 9, 18
After a volatile week of news and market swings, from ECB meetings to trade war concerns after the U.S. imposed tariffs to foreign steel and aluminum yesterday, markets are steady heading into the weekly nonfarm payroll, as investors get a good look at the health of the economy. Earlier this week, private payroll data surprised to the upside, raising expectations for a good number today, but markets will be closely watching the average hourly earnings, as a higher figure will again raise inflation fears and in turn boost expectations for the Fed to get aggressive on rising rates to head off such concerns.
After big swings, stocks ended little changed on Thursday after President Donald Trump followed through and signed an order that will implement tariffs on steel and aluminum imports, but which offered an immediate exemption for Mexico and Canada and allows other countries to negotiate exclusions. Stocks traded on either side of unchanged for much of the session, finding strength late in the day as details of the plan emerged. The Nasdaq Composite index posted a 5th straight day of gains, though commodity prices declined, led by gold and oil weakness as the dollar surged against the euro.
In Asian markets, The Nikkei Index rose 101 points to settle at 21,469, the Shanghai Index gained 18 points to settle at 3,307, and the Hang Seng Index surged 341 points to settle at 30,996. In Europe, the German DAX is down over -40 points at 12,315, while the FTSE 100 is up a few points holding above the 7,200 level. With one session left in the week, the S&P 500 is looking at a gain of 1.8%, and the Dow is poised to rise 1.5%. The Nasdaq Composite is set to mark the week’s biggest gains, with a rise of 2.3%.
Market Closing Prices Yesterday
·      The S&P 500 Index jumped 12.17 points, or 0.45%, to 2,738.97
·      The Dow Jones Industrial Average rose 93.85 points, or 0.38%, to 24,895.21
·      The Nasdaq Composite gained 31.30 points, or 0.42%, to 7,427.95
·      The Russell 2000 Index declined -2.57 points, or 0.16% to 1,571.97
Events Calendar for Today
·      8:30 AM EST       Change in Nonfarm Payrolls, for February…est. 205K
·      8:30 AM EST       Change in Private Payrolls for Feb…est. 203K
·      8:30 AM EST       Change in Manufacturing Payrolls, for Feb…est. 15K
·      8:30 AM EST       Unemployment Rate for Feb…est. 4.0%
·      8:30 AM EST       Average Hourly Earnings for February…est. 0.2%
·      10:00 AM EST     Wholesale Inventories MoM for January…est. 0.7%
·      12:45 PM EST     Fed’s Evans speaks on Monetary Policy
·      1:00 PM EST        Baker Hughes Weekly Rig Count
World News
·      President Trump agrees to hold talks with Kim Jong Un by May, ABC News reported
·      Japanese Prime Minister Shinzo Abe held talks over phone with U.S. President Donald Trump today and told his intention to visit the U.S. early April
Sector News Breakdown
·      Big Lots (BIG) Q4 EPS $2.57/$1.64B vs. est. $2.46/$1.66B; Q4 comp sales fell (-0.1%); announces $100M share repurchase agreement and raises dividend to 30c; sees Q1 EPS $1.15-$1.22 vs. est. $1.31
·      UAL’s (UAL) February 2018 consolidated traffic (revenue passenger miles) increased 5.7% and consolidated capacity (available seat miles) increased 3.8% vs. February 2017. UAL’s February 2018 consolidated load factor increased 1.4 points compared to February 2017. Continues to expect Q1 consolidated passenger unit revenue to be flat to up 2.0% vs. same last year
·      United Natural Foods (UNFI) Q2 adjusted EPS 71c/$2.53B vs. est. 55c/$2.45B; raises FY18 adjusted EPS view to $3.06-$3.14 vs. est. $2.94 and sees net sales in the range of approximately $10.01B-$10.16B, vs. prior view of $9.84B-$10.0B v. est. $9.92B
·      Chuy’s (CHUY) Q4 adjusted EPS 19c/$96M vs. est. 20c/$95.57M; comparable restaurant sales increased 1.3% as compared to the same period in 2016; sees FY18 EPS $1.12-$1.16 vs. est. 1.15; sees FY18 Comparable restaurant sales growth of 1.0% to 1.5%
·      El Pollo Loco (LOCO) Q4 EPS 11c/$95.2M vs. est. 10c/$95.23M; Q4 system-wide Same restaurant sales up 1.4% vs. est. 1.1%; sees FY18 EPS 68c-73c vs. est. 70c; sees FY18 system-wide same-restaurant sales flat
·      Limoneira (LMNR) Q1 EPS loss (9c)/$31.6M vs. est. loss (13c)/$28.77M; raises FY18 EPS view to 65c-75c from 55c-65c (est. 59c)
·      Peak Resorts (SKIS) Q3 EPS 53c/$59.27M vs. est. 54c/$59.69M
·      Toy retailer Toys ‘R’ Us is preparing for a liquidation of its bankrupt U.S. operations after so far failing to find an acquirer or reach a debt restructuring agreement with lenders, Bloomberg reported late yesterday (watch HAS, MAT)
·      China Resources Beer Co. is in talks about potentially purchasing Heineken NV’s business in China, a transaction that could be worth more than $1B, Reuters reported
·      Helmerich & Payne (HP) upgraded to positive at Susquehanna; PT $75
·      TPI Composites (TPIC) Q4 EPS 17c/$247.1M vs. est. 19c/$251.68M; sees FY18 EPS 38c-42c on revs $1B-$1.5B vs. est. 43c/$1.3B
·      Cohen & Steers, Inc. (CNS) February assets under management fell to $57.7B from $61.3B reported in January due to market depreciation
·      GAIN Capital (GCAP) Q4 adjusted EPS loss (10c)/$69.7M vs. est. loss (7c)/$91.31M
·      Cooper Companies (COO) CEO Robert Weiss to retire; Q1 EPS $2.79/$590.0M vs. est. $2.54/$583.48M; sees FY18 EPS $11.70-$11.90 on revs $2.51B-$2.56B vs. est. $11.67/$2.52B
·      Crispr Therapeutics (CRSP) Q4 EPS 0c/$32.3M attributable to deferred revenue recognized in conjunction with the execution of the company’s collaboration agreement with Vertex
·      Insys (INSY) Q4 EPS loss (61c)/$31.5M vs. est. loss (14c)/$34.0M; 4Q gross margin +85.4%, 4Q adjusted Ebitda loss $11.5M and 4Q cash and other $32.0M
·      MyoKardia’s (MYOK) mavacamten shows positive action in mid-stage study; results from a Phase 2 clinical trial, PIONEER-HCM, assessing its mavacamten in patients with symptomatic obstructive hypertrophic cardiomyopathy (oHCM) showed a treatment benefit
·      PDL BioPharma (PDLI) posted Q4 product revenue $32.6M vs. $20.1M QoQ; Q4 EPS 15c and total revs $68M vs. 14c/$62.7M QoQ
·      The Medicines Company (MDCO) said that randomization of more than 1,500 patients in the ORION-10 trial in the United States has been completed in only 12 weeks – considerably beating its goal of 22 weeks. ORION-10 is a double-blind, randomized Phase III trial designed to confirm the efficacy and safety of inclisiran
·      Senomyx (SNMX) Q4 EPS 15c/$14.93M vs. est. loss (6c)/$4.83M
·      TherapeuticsMD (TXMD) announced the acceptance of the NDA for TX-001HR by the U.S. FDA. TX-001HR is the company’s investigational bio-identical hormone therapy combination of estradiol and progesterone in a single, oral soft gel for the treatment of moderate-to-severe vasomotor symptoms due to menopause
·      Global Blood Therapeutics (GBT) files to sell 3.5M shares of common stock
Technology, Media & Telecom
·      Finisar (FNSR) shares fell -7%; Q3 EPS 20c/$332.4M vs. est. 23c/$333.23M; sees Q4 EPS 9c-15c on revs $300M-$320M below consensus 22c/$334.82M; sees Q4 gross margins 27%-28% after Q3 GM 28.6%, below the 30.5% estimate
·      Marvell (MRVL) Q4 EPS 32c/$615M vs. est. 31c/$610.99M; sees Q1 adjusted EPS 29c-33c on revs $585M-$615M vs. est. 29c/$590.8M; GAAP and non-GAAP gross margins are expected to be approximately 62%-63%
·      Verifone (PAY) Q1 EPS 23c/$437M vs. est. 23c/$419.42M; sees Q2 adjusted EPS 27c-28c on revs $435M vs. est. 32c/$440.3M; backs FY18 adjusted EPS view $1.47-$1.50 and backs FY18 revenue view $1.787B-$1.812B
·      Qualcomm (QCOM) boosts quarterly dividend by 9% to 62c from 57c
·      Etsy (ETSY) files to sell $300M in convertible senior notes due 2023
·      IDT Corp. (IDT) said “In light of our intention to continue to invest heavily in our promising growth initiatives and the impact of the spin-off of Rafael on our balance sheet, IDT’s Board of Directors has reduced our dividend for the second quarter to 9c” (from 19c)
·      NIC Inc (EGOV) sees FY18 EPS 75c-79c on revs $333M-$343M vs. est. 84c/$336.59M; authorizes $25M share buyback
·      Upland Software (UPLD) Q4 EPS 37c/$27.8M vs. est. 27c/$27.17M; sees Q1 revenue $29.6M-$30.6M vs. est. $29.35M; sees Q1 adjusted EITDA $9.9M-$10.5M
·      Yext (YEXT) Q4 adjusted EPS loss (10c)/$48M vs. est. loss (12c)/$48.04M; sees FY19 adjusted EPS (46c)-(44c) on revs $224M-$226M vs. est. loss (46c)/$225.36M


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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