Mid-Morning Look: August 07, 2020

Auto PostDaily Market Report

Mid-Morning Look

Friday, August 07, 2020






DJ Industrials




S&P 500








Russell 2000






U.S. equities opened lower, but quickly recovered as investors look to take advantage on any market dip, no matter how small, as markets look to the positive jobs data this morning as the U.S. added 1.76M jobs in July, topping consensus of 1.48M, while the unemployment rate fell to 10.2% from 11.1%, also topping consensus of 10.6%, and wages jumped. The data followed strong jobless claim improvement yesterday, but still doesn’t dent the fact that the Fed will continue to support the economy through low rates (at least until late 2021 as per many Fed heads) and stimulus measures. Markets dropped overnight (minimally) on increased market tensions between China and the U.S. as President Trump issued executive orders Thursday night banning “transactions” with the Chinese owners of the TikTok and WeChat apps starting Sept. 20. WeChat’s owner, Shenzhen-based tech giant Tencent Holdings Inc. (TCEHY) is one of the world’s largest and most valuable companies with stakes in many video game companies. The moves come ahead of renewed trade talks which are expected between Beijing and Washington advisors late next week. The S&P and Dow come into the day with 5-day win streak, save for gold prices, while the Nasdaq Composite looks to make it an 8th straight session of gains after what was a very busy week of corporate earnings for Q2, with the bulk of results now out of the way. The dollar seeing its first meaningful strength in weeks, rising about 0.9% following the good jobs data, as commodity prices take a breather after its historic run (for gold).


Economic Data

·     Nonfarm Payrolls for July showed an increase of 1.8M jobs vs. est. 1.48M (prior month 4.791M), while private payroll jobs added were 1.462M vs. est. 1.2M (prior revised to 4.737M) and manufacturing payroll jobs added only 26K vs. est. 255K – the unemployment rate slips to 10.2% from 11.1% (est. 10.6%) and average hourly earnings rose 0.2% vs. est. (-0.5%) decline

·     U.S. June wholesale inventories revised to -1.4% vs. est. drop -2.0%, while June wholesale sales rose +8.8% topping the 4.9% estimate and up from May +5.7%







WTI Crude















10-Year Note





Sector Movers Today

·     Media & Telecom movers; DISH Q2 revs of $3.19B tops the $3.1B est; loses 40,000 Dish TV net subscribers, lower than loss of 79,000 subscribers a year earlier; net income attributable to co rises to $452 mln, or 78c from $317 mln, or 60c (more); LBRDA and GLIBA entered into a definitive merger agreement last night under which Liberty Broadband has agreed to acquire GCI Liberty in a stock-for-stock merger; TMUS shares hit record high after co adds more monthly phone subscribers than expected in Q2, posts revs beat

·     IT Services; several earnings out last night for group, recapped by Cowen saying: G strong execution drives big 2Q delta. It actually grew 3% vs. expected contraction of -5% and showed margin expansion on good cost control. It called out the 2Q revenue trough and sees stable margin from here, and a return to double digit global client revenue growth late next year (FY21); DXC beat on the quarter, but more importantly, communicated that progress on fixing troubled accounts is largely complete and its winning new work. It reported a B2B of 1.2x and affirmed asset sale plans; CNDT soars as beats across board on 2Q and an outsized new business bookings with TCV up 90% y/y with annual recurring revenue up 25% had the stock up over 50% last night

·     Software; Truist notes in earnings recap that EVBG reported upside to revenue and profitability metrics and highlighted continued CEM traction and ongoing growth drivers related to return to work and COVID-19; UPWK 2Q results reflected upside across revenue and adjusted EBITDA while organic growth of 8% y/y was solidly above target range of 3% – 7%; PCTY reported revenue and EBITDA upside and highlighted solid bookings momentum and strong July sales month with these positive demand signals driving N-T growth investment



·     AAOI +14%; shares help optical space as posts smaller Q2 EPS loss on big revenue beat and guided Q3 revs $76M-$83M well above the $59M estimate

·     ANPC +74%; after saying it has been validating its COVID-19 antibody test for commercial use at its California lab and expects the process to be completed by second half of 2020

·     BIIB +12%; after it and partner Eisai said the FDA has accepted its Biologics License Application (BLA) for aducanumab, an investigational treatment for Alzheimer’s disease as the application has been granted priority review

·     FSLR +17%; after 2Q net sales and EPS topped estimates, prompting an upgrade to buy from neutral from Bank America emphasizing confidence on bookings outlook

·     GRPN +45%; after earnings as Q2 EPS loss (93c) on revs $395.6M vs. est. loss ($2.64) and $201.6M; for 2021, we expect to realize approximately $200 million in savings from our restructuring actions

·     SAIL +12%; reported strong 2Q results with revenue, billings, and operating leverage significantly ahead of our and Street expectations primarily due to strength in the company’s license business (up 80.4% yoy) as well as strong performance in its subscription business (up 36.2% yoy).

·     STMP +18%; as 2Q adjusted EPS $3.11 on revs $206.7M well above the consensus $1.09 and $144M, while mailing and shipping revenue rise 46% YoY and also boosted year forecast

·     TMUS +8%; shares hit record high after co adds more monthly phone subscribers than expected in Q2, posts revs beat

·     ZG +16%; Q2 results came in ahead of estimates across all revenue and profitability segments as the core Premier Agent business showed strong engagement and retention exiting Q2, and the company is guiding to ~15% y/y PA revenue growth



·     AYX -27%; Q2 EPS/revs beat and ARR totaled $430M up 40% YoY but bookings were flat and the company guided revenue lower for Q3 and year (sees revenue of $460-465M for year, below the $505.14M consensus

·     CARG -13%; after the company reported lower marketplace subscription revenue of $79.96M (-38% Y/Y) on operations shutdown in Germany, Italy, and Spain in its active cost-saving efforts.

·     DBX -8%; shares slip after Q2 EPS and revs top views, helped by increased demand for its cloud services software, but was overshadowed by the departure of its CFO

·     EOG -6%; among top decliners in energy sector after Q2 adj EPS loss (23c) worse than the estimate for (5c) loss and revs huge miss at $1,1B vs. est. above $2.4B

·     FTNT -8%; 2Q topline and profitability upside overshadowed by inline billings, decelerating 7ppts to 14% YoY

·     ILMN -12%; as reported a lower-than-expected Q2 profit and revenue, hurt by pandemic-related disruption in its customers’ operations and withdraws its 2020 full-year revenue and earnings per share outlook (downgraded at Piper);


·     Change Healthcare (CHNG) 15M share Block Trade priced at $12.50

·     Checkmate Pharmaceuticals (CMPI) 5M share IPO priced at $15.00

·     Evoqua Water (AQUA) 8M share Spot Secondary priced at $20.75

·     Freeline (FRLN) 8.824M share IPO priced at $18.00

·     Horizon Therapeutics (HZNP) 11.8M share Secondary priced at $71.00

·     IBEX (IBEX) 4.762M share IPO priced at $19.00

·     Quanterix (QTRX) 2.651M share Spot Secondary priced at $32.00

·     Twilio (TWLO) 5.06M share Secondary priced at $247.00

·     Zynga (ZNGA) 49M share secondary priced at $9.70


Market commentary provided by Catena Media Financials US, LLC, a firm separate from and not affiliated with Regal Securities. Regal Securities has not participated in the creation of the content, and does not explicitly or implicitly endorse the content.

Live Trading

Open an Account

Paper Trading