Mid-Morning Look: January 26, 2022

Auto PostDaily Market Report

Mid-Morning Look

Wednesday, January 26, 2022






DJ Industrials




S&P 500








Russell 2000






A good start to the day for U.S. stocks, with the S&P, Nasdaq and Russell 2000 surging after better MSFT guidance last night helped to flip sentiment ahead of the FOMC policy meeting results later today (2:00 PM), briefly pushing the S&P 500 back above its 200-day Moving average level around 4,430 (though broke back below those levels to morning intraday lows amid uncertainty ahead of the Fed). Earnings in full-steam ahead mode this week, but all eyes on the Fed policy comments this afternoon. Policy makers are poised to signal plans for their first interest rate hike since 2018 (for the March meeting) and discuss shrinking their balance sheet as they seek to restrain the hottest inflation in nearly 40 years. No interest rate moves are expected this afternoon. Gold prices drop after hitting 2-month highs yesterday, Treasury yields steady ahead of Fed (10-yr at 1.78%), the dollar index at highs up +0.2% and oil prices jumping with Brent crude approaching the $90 per barrel level. The CBOE volatility index (VIX) is down over 8% to below $29 after closing at 31.16, its highest since Jan 29, 2021. Recap of some of the top sector and stock movers this morning below.







WTI Crude















10-Year Note





Sector Movers Today

·     Casinos, Gaming, Lodging & Leisure sector; Macquarie downgraded RRR to Neutral as they see more value in other names after shares were +132% last yr (vs gaming +41%), upgraded PENN to Outperform and trim tgt to $71 from $80 as they see the market giving its online business little to no value at current levels that includes its recent SCR acquisition; DKNG upgraded to Overweight at Morgan Stanley with an unchanged price Target of $31 as recent pullback presents an opportunity to invest for the long term; Truist trimmed their estimates and PTs on marine stocks BC, HZO, MBUU, MCFT, ONEW to reflect supply chain pressures now likely to carry into 2023

·     Media & Telecom movers; VZ was downgraded to Neutral from Overweight at JPMorgan and lowered YE22 price tgt to $56 from $62 as are increasingly concerned about the subscriber growth outlook for postpaid phones in 2022 for Verizon and the industry overall, even beyond 1Q which is seasonally soft; AT reported 4Q21 Revenues of $41B vs. est. $40.4B driven primarily by a beat in the Warner Media segment, which did Revs of $9.8B vs. est. $9.1B. The company reported +884k post-paid phone net adds and EPS Of $0.78 vs. cons. $0.76. For 2022, they expect consolidated revenue growth in the low-single digits range; NLSN downgraded from Neutral to Sell and lowering tgt from $23 to $17 at Goldman Sachs as believe NLSN faces secular and competitive challenges associated with the fragmentation of media consumption

·     Transports; in truckers, Barclays downgraded CHRW to EW from OW, HTLD downgraded to Underweight from EW and JBHT upgraded to OW from W and up tgt to $235 from $220; in rails earnings from CNI as Q4 adj EPS C$1.71 vs. C$1.43 last year; Q4 revs C$3.75B vs. C$3.66B; Q4 operating ratio improved to 58.3% – company’s profits increased $168M yoy on $97M increase in revenue – reflecting strong pricing (rev/RTM was up over 14% yoy in the Q); NSC Q4 profit and revenue that topped Wall Street estimates, as the railroad company’s operating ratio improved; in research, CAR upgraded to from Underweight to Neutral at JPMorgan after the stock price declined materially since the time of our last update following 3Q earnings; HA earnings show ramp-up of service to Japan delayed, lowering capacity and driving higher CASM

·     Biotech movers; MRNA was upgraded at Deutsche Bank to Hold from Sell saying investors can stop selling after the recent precipitous decline (stock has plunged 31.6% during its 8-day losing streak, and has plummeted 68.5% since its Aug. 9, 2021 post-pandemic peak of $484.47; INCY withdrew the New Drug Application (NDA) for parsaclisib for the treatment of patients with relapsed or refractory follicular lymphoma; GILD announced the FDA placed a partial clinical hold on its study of magrolimab in combination with azacitidine due to a potential safety signal; VRTX earnings tonight; TYME discontinues SM-88 with MPS arm of Phase 2/3 trial in metastatic pancreatic cancer for futility on primary endpoint of overall survival



·     C +2%; strength in banking stocks early (JPM, PNC, UBS) ahead of FOMC policy meeting

·     FCX +3%; posted a 56% jump in Q4 profit as supply concerns and the global economic recovery boosted prices; said Freeport’s average realized price of copper soared 30% in the fourth quarter ended Dec. 31 to $4.42 per pound

·     GLW +14%; Q4 EPS 54c vs est. 52c on revs $3.71B vs est. $3.6B, guided Q1 adj EPS 48-53c vs est. 48c on revs $3.5-3.7B vs est. $3.4B, and said they expect gross margin to expand due to revised pricing terms taking effect throughout this year

·     MAT +10%; reclaimed the rights to produce toys based on Walt Disney Co’s “Frozen” franchise and Princess lineup, more than seven years after losing it to rival Hasbro (HAS)

·     MRNA +3%; upgraded at Deutsche Bank to Hold from Sell saying investors can stop selling after the recent precipitous decline (stock has plunged 31.6% during its 8-day losing streak, and has plummeted 68.5% since its Aug. 9, 2021 post-pandemic peak of $484.47

·     MSFT +4%; beat on top and bottom line, strong commercial bookings growth (+37% in constant-currency) from large long-term Azure contracts; guidance for sequential Azure constant-currency revenue acceleration in 3Q (i.e. >46% Y/Y), driven by strong growth in Azure consumption

·     PENN +6%; upgraded to Outperform at Macquarie as they see the market giving its online business little to no value at current levels that includes its recent SCR acquisition

·     TXN +4%; posted an easy beat for Q4 (EPS $2.27 vs est. $1.94 on revs $4.83B vs est. $4.43B) and issued better 1Q revs $4.5-4.9B vs est. $4.37B driven by strong demand in industrial and automotive (results boosting other chip makers AVGO, QRVO, AMAT, NXPI)



·     ANTM -2%; beat analysts’ estimates for Q4 earnings, but forecast lower-than-expected profits for the full year as expects 2022 adj EPS “greater than” $28.25″ vs. est. $28.59

·     BA -2%; incurred a $3.5B charge in Q4 due to longer-than-expected delivery delays of its problem-plagued 787 Dreamliner, leading to adj EPS ($7.69) to widely miss est. ($0.42) on revs $14.79B also below est. $16.67B

·     CLX -3%; Credit Suisse downgraded CHD to Neutral on valuation after shares rose 18% since Q3 earnings in October and CLX to Underperform

·     FFIV -13%; after soft guidance as sees 2Q revs $610-650Mm vs est. $692.7Mm, sees FY revs +4.5-8% vs est. +8.3%

·     GATO -68%; after the company concluded that there were errors in its technical report from July 2020, as well as “indications that there is an overestimation in the existing resource model.”

·     HMY -6%; cut its forecast for annual gold production by 4% and made a similar increase to its cost guidance due to operational challenges at its Papua New Guinea mine

·     KMB -5%; Q4 adj EPS $1.30 vs est. $1.24 on revs $5B vs est. $4.89B but shares were pressured on weaker guidance of FY22 sales growth 1-2% that would miss estimates above $20B and earnings $5.60-6 also below est. $6.72


Market commentary provided by Hammerstone Markets, Inc, 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