Morning Preview: September 20, 2019

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Early Look

Friday, September 20, 2019





DJ Industrials




S&P 500










Stock futures point to a positive open for the Dow and S&P 500, with Asian and European markets also largely in the green. Markets are edging higher amid the return of U.S. and China to the trade negotiations table, as well as continuing to digest the latest round of action from central banks. U.S. and Chinese deputy trade negotiators resumed face-to-face talks for the first time in nearly two months on Thursday, ahead of higher-level talks in October, as the world’s two largest economies try to iron out their trade differences. In Asian markets, The Nikkei Index rose 34 points to 22,079, the Shanghai Index rose 7 points to 3,006 and the Hang Seng Index fell -33 points to 26,435. In Europe, the German DAX is up around 20 points to 12,480, while the FTSE 100 is little changed at 7,360. Friday is quadruple witching day for U.S. markets, when the quarterly expiration of futures and options on indexes and stocks occurs on the same day. It is a really quiet start to the day with no major economic data expected, or earnings and likely not many headlines out on trade, but there are three Fed speakers throughout the day that could possibly move markets.

Market Closing Prices Yesterday

·     The S&P 500 Index edged higher 0.06 points, or 0.01%, to 3,006.79

·     The Dow Jones Industrial Average fell -52.29 points, or 0.19%, to 27,094.79

·     The Nasdaq Composite gained 5.49 points, or 0.07%, to 8,182.88

·     The Russell 2000 Index declined -6.87 points, or 0.44% to 1,561.47


Events Calendar for Today

·     11:20 AM EST    Fed’s Rosengren speaks in New York

·     12:00 PM EST    Household Change in Net Worth for Q2

·     1:00 PM EST       Baker Hughes Weekly Rig Count






WTI Crude















10-Year Note





World News

·     World economic growth is “fragile” and “under threat,” former International Monetary Fund director Christine Lagarde says, and is over-reliant on the actions of central banks

·     St. Louis Fed President James Bullard issued a statement Friday explaining his dissent at this week’s Federal Open Market Committee meeting, saying he wanted a more aggressive half-point cut due to signs the economy is slowing down. At the end of its two-day meeting, the FOMC voted 7-3 to trim rates by a quarter-point to a range between 1.75% and 2%


Sector News Breakdown


·     Beyond Meat Inc. (BYND) said that former Inc. (AMZN) and Tesla Inc. (TSLA) executive Sanjay Shah will be the meat-alternative company’s chief operating officer. Shah was most recently senior vice president of Tesla’s solar business, a role he took on in 2018

·     Steelcase (SCS) Q2 EPS 50c/$998M vs. est. 43c/$980.87M; sees Q3 revs $920M-$945M vs. est. $940.7M and EPS 33c-37c vs. est. 35c

·     Scholastic (SCHL) Q1 adjusted EPS loss ($1.59) on revenue $232.6M, while backs FY20 revenue view $1.67B-$1.7B and Adjusted EBITDA of $140M-$160M and still sees year cap-0ex $75M-$85M (vs. $95M in FY19)

·     Foundation Building Materials (FBM) 4.75M share Secondary priced at $17.00


Energy, Industrials & Materials

·     Gasoline futures rallied on Thursday following reports of massive flooding in Texas, leading to concerns of a slowdown in refining activity and lower demand for crude oil. October gasoline futures settled +2.6% to $1.7007 per gallon

·     California Resources (CRC) rebounds after saying it is not planning to hire advisors or plan a restructuring saying is actively looking asset sales to delever – company responds to weakness in shares yesterday, Bloomberg reports

·     The nation’s top aviation regulator tested new flight-control software for the Boeing (BA) 737 Max in a simulator on Thursday and gave it a favorable review. New Federal Aviation Administration chief Stephen Dickson also toured the Max assembly line near Seattle

·     Moody’s Investors Service downgraded McDermott Technology (MDR) corporate family rating to B3 from B2 to reflect the hiring of advisors to evaluate strategic options in light of the higher than expected costs and cash outflows

·     TC Pipelines (TCP) upgraded to Buy from Underperform at Bank America



·     Aerie Pharmaceuticals (AERI) announced the European Medicines Agency’s, or EMA, Committee for Medicinal Products for Human Use, or CHMP, has adopted an opinion recommending approval of the marketing authorization application, or MAA, for Rhokiinsa

·     Jazz Pharma (JAZZ) Ivozall (clofarabine) received a positive generic recommendation from the European Medicines Agency’s CHMP

·     Align Technology, Inc. (ALGN) announced a global distribution agreement for the award-winning iTero Element family of intraoral scanners with Zimmer Biomet Dental, a division of Zimmer Biomet (ZBH).


Technology, Media & Telecom

·     Texas Instruments (TXN) raises quarterly dividend 17% to 90c from 77c per share

·     Facebook’s (FB) Mark Zuckerberg met with President Donald Trump on Thursday during a visit to Washington where the CEO faced aggressive questioning from lawmakers about the social network’s failures to protect consumer privacy.

·     Xilinx, Inc. (XLNX) announced that EVP and CFO Lorenzo Flores is stepping down from his position to pursue another executive opportunity

·     Western Digital Corp. (WDC) said it entered into a definitive agreement to sell its IntelliFlash™ business to DDN and also agreed to expand their existing partnership through a multi-year strategic sourcing agreement

·     Liberty Global (LBTYA) downgraded to Sell from Buy at Citigroup

·     Xilinx (XLNX) downgraded to Neutral from Buy at Bank America


Content is provided by Hammerstone Inc., which has no affiliation with Regal Securities, Inc. (“Regal”) This commentary is provided for information purposes only, and is not a recommendation, offer or solicitation by Regal to buy or sell securities or to adopt any investment strategy. Regal has not participated in the creation of the Hammerstone content and does not directly or indirectly endorse the content. Any reliance on this material is at the sole discretion of the reader.

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