Mid-Morning Look: June 10, 2021

Auto PostDaily Market Report

Mid-Morning Look

Thursday, June 10, 2021






DJ Industrials




S&P 500








Russell 2000






After days of flirting with new all-time highs, the S&P 500 index finally trades to a new record, paced by gains in energy, industrials, and technology (though strength was generally broad-based) as the monthly inflation data reading (May CPI) came in only moderately higher than what economists had been expecting, not changing the narrative for broader markets, interest rates, of Fed outlook. At the same time, the European Central Bank leaves rates and bond buying unchanged as had been expected. Best of both world for stock markets as headline CPI rose to 5% (highest since 2008) and core prices jumped as well, but only slightly above estimates and failing to raise fears of permanent price hikes (note PPI data is due next Tuesday). Among the jumps in prices in May for consumers used autos rose 7.3%, airlines fares 7.1%, natural gas 1.7%, apparel 1.2% and food 0.4%. Still, transitory remains the key term from the Fed (they better be right) on the price increases as markets unphased with the CBOE Volatility index (VIX) trading lower yet again (under the 17 level) and Treasury yields falling still (10-year below 1.5%). Outside of the macro news today, handful of retailers active on earnings, “meme” stocks again volatile (this time to the downside) as well as other momentum related sectors (Bitcoin, solar). In Washington, U.S. Senate Minority Leader Mitch McConnell has told fellow Republicans he is open to a new bipartisan infrastructure plan, Republican Senator Susan Collins said.


Economic Data

·     May Consumer Price Index (CPI) rises +0.6% MoM vs. est. +0.5%; while core CPI MoM (Ex-Food & Energy) rises +0.7% vs. est. 0.5%; May Consumer Prices (CPI) increase 5% YoY (fastest pace since 2008) vs. est. 4.7% while Core CPI YoY rises 3.8% vs. est. 3.4%; May CPI food +0.4%, housing +0.4%; index for used cars and trucks continued to rise sharply, increasing 7.3% in May.

·     U.S. weekly jobless claims fell to 376K in the latest week vs. the consensus 370K and down from 385K last week; the 4-week moving avg fell to 402,500 from 428,000 prior week; continued claims fell to 3.499M in latest week from 3.757M prior and U.S. insured unemployment rate fell to 2.5% from 2.7% prior week.







WTI Crude















10-Year Note





Sector Movers Today

·     E&P and Majors; in research, RBC Capital said they believe the investment proposition for U.S. E&P continues to strengthen with FCF that could amount to most of some companies’ total value over the next several years. We believe the group could have another 50-100% of implied upside if investors continue to ride the wave. Our top ideas are COP, FANG, CRC while they upgraded MRO to Outperform and raise tgt to $18, while downgraded SM, CPE, CLR given relative valuation to rest of the space (raise tgts on several); in the gas space, MKM Partners downgraded shares of RRC and MTDR to Neutral from Buy

·     Healthcare Services; CLOV downgraded to Underperform from Neutral at Bank America with an unchanged price target of $10 noting the 100% rally in the past week and shares are now trading at a 70% premium to ALHC its closest comp; APR 4.5M share Secondary priced at $27.00; LFST 40M share IPO priced at $18.00; in research, RBC Capital upgraded CYH to Outperform with $21 pt in hospital space as believe the company is now better positioned from an operational and financial perspective, and upgraded PNTG to Outperform, while downgraded ANTM to Sector Perform from Outperform, as trading levels approach their price target of $399 tgt and cut UHS to Sector Perform & raises PT to $165 as see comparatively fewer catalysts for multiple expansion from current levels versus peers – overall maintain positive stance on initial 2021 best ideas list: HCA, SGRY, UNH, HUM, and CVS

·     Asset managers; AB said monthly Assets under management (AUM) increased to $731 billion during May 2021 from $724 billion at the end of April; firmwide net inflows, coupled with market appreciation, drove the 1% increase; APAM monthly AUM totaled $172.9 billion; BEN monthly prelim AUM of $1,543.5 billion at May 31, 2021, compared to $1,529.3 billion at April 30, 2021; IVZ prelim monthly AUM of $1,505.1 billion, an increase of 3.2% versus previous month-end – total net inflows were $31.9 billion; VRTS monthly AUM as of May 31, 2021 of $175.5 billion; TROW preliminary month-end assets under management of $1.59 trillion as of May 31, 2021

·     Software movers; in research, ZM upgraded to Buy with $440 tgt at Argus after reported a strong quarter in fiscal 1Q22 against an easy prior-year comp/says continues to benefit from the extraordinary growth in its installed base that came with last year’s pandemic lockdowns; NOW upgrade from Buy to Conviction Buy w/ $695 pt at Goldman Sachs as came away incrementally positive on ServiceNow’s improving near-term fundamentals; SE was upgraded to Buy at Bank America as its e-commerce arm Shopee exceeds expectations on growth in SE Asia and is seeing rapid success in efforts to become a meaningful name in Latin America



·     EDU +10%; China education stocks (EDU, TAL, GOTU) which have been clobbered the last few weeks bounce after school tutoring ban less likely after newest comments https://bit.ly/3pCNSGK

·     FFIV +2%; upgraded to Outperform at Credit Suisse and increasing our target price to $235 following our NDR with FFIV Mgmt. which included the CEO, CFO, and IR

·     FSLR +3%; seeing broad strength in solar stocks early (SPWR, CSIQ)

·     NOW +3%; upgrade from Buy to Conviction Buy w/ $695 pt at Goldman Sachs as came away incrementally positive on ServiceNow’s improving near-term fundamentals

·     RH +14%; reported much stronger than expected 1Q results driven by sales, gross margin and SG&A leverage and boosted its year sales forecast as analysts hike their price tgts

·     SIG +15%; posted Q1 EPS $2.23 vs est. $1.27 on sales $1.7B vs est. $1.62B, sees Q2 revs $1.6-1.65B vs est. $1.33B, and raised its FY guidance to now see comp sales +24-27% vs prior +17-20% and revs $6.5-6.65B from $6-6.14B



·     FCEL -11%; as reported a wider-than-expected Q2 EPS loss as revenue surprisingly declined and the company continued to increase investment into research and development (revs fell 26% to $13.95M from $18.88M and below est. $18.91B)

·     FSLY -2%; downgrade from Outperform to Perform at Oppenheimer noting outages happen to all cloud companies, and FSLY responded rapidly and with candor, but switching costs for CDNs are relatively low, and customers could look for second-source providers (AKAM) and says the shutdown could impact new sales for a while

·     GME -9%; after the company said it planned to offer more shares and disclosed that regulators are investigating trading of its stock

·     LEN -3%; housing stocks coming under pressure with between 2%-3% declines in space

·     NLSN -2%; downgraded at Morgan Stanley as the stock has increased ~100% since Oct31,2020 vs. the S&P 500 of ~30%, leaving limited upside of 8% to our maintained $29 price target

·     OCGN -19%; plunges after saying it will no longer pursue an emergency use authorization for its COVID-19 vaccine candidate, Covaxin, in the U.S, but will instead aim to file for a full approval.



·     Aclaris Therapeutics (ACRS) 7.04M share secondary priced at $17.75

·     1stDibs (DIBS) 5.75M share IPO priced at $20.00

·     Apria (APR) 4.5M share Secondary priced at $27.00

·     Celsius Holdings (CELH) 6.52M share Secondary priced at $62.50

·     Clarivate (CLVT) 38.462M share Secondary priced at $26.00

·     Genius Sports (GENI) 22M share Secondary priced at $19.00

·     Jamf Holding (JAMF) 8.5M share Secondary priced at $33.00

·     Leslie’s (LESL) 24.5M share Secondary priced at $27.64

·     LifeStance (LFST) 40M share IPO priced at $18.00

·     Materialise (MTLS) 4M share Secondary priced at $24.00

·     Monday.com (MNDY) 3.7M share IPO priced at $155.00

·     PLBY Group (PLBY) 4.72M share Secondary priced at $46.00

·     Zeta Global (ZETA) 21.5M share IPO priced at $10.00


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