Early Look

Friday, April 1, 2022

Futures	Up/Down	%	Last
Dow	162.00	0.47%	34,780
S&P 500	21.25	0.47%	4,552
Nasdaq	79.50	0.53%	14,948

 

 

U.S. S&P futures looking higher +0.5% above 4,550, near its overnight highs (4,555.50) after yesterday’s late day swoon sent the index down -1.5%. The rebound comes ahead of the monthly payroll jobs report at 8:30 AM ET where ests are for +490K Nonfarm payrolls, +480K private payrolls, unemployment to dip to 3.7% and wages to rise +0.4% m/m and +5.5% y/y. Russia/Ukraine negotiations are set to restart later today; European gas buyers have gone through the deadline where they’re expected to start paying for gas in rubles. Weakness in China manufacturing overnight as China’s (March) Caixin manufacturing PMI actual 48.1 vs 50.4 previous and below est. 49.9. Treasury yields are rebounding after tumbling the last 2-days of the quarter, but still posted its best quarter since 1994, as the 10-year yield jumped to highs above 2.5% after ending 2021 at 1.51% (ended ’21 with 60 bps rise), while the 2-year also around 2.30% after surging over 150bps this quarter. In Asian markets, The Nikkei Index fell -155 points or 0.56% to close the week at 27,665, the Shanghai Index rose 30 points or 0.94% to 3,282, and the Hang Seng Index gained 0.19% to 22,039. In Europe, the German DAX gains roughly 0.5% to 14,480, while the FTSE 100 is higher by 0.25% to 7,535. The first quarter of 2022 closed with sharp selling pressure as the Nasdaq 100 falls 9% for worst quarter since March 2020 and the benchmark S&P 500 falls 4.9% for its worst quarter since March 2020 after fresh signs of rising inflation, and slower consumer spending put investors on the defensive as they weigh the Federal Reserve’s tightening plans. All 11 S&P 500 sectors finished the day lower in broad selling to close at the lows, paced by declines in small caps, semiconductors, and financials. Treasury yields tumbled, along with oil prices and energy stocks as the U.S said it would release a record amount from its Strategic Petroleum Reserve (SPR), 180M barrels, to help boost supply in the face of rising prices. The dollar gained and gold edged higher.

 

Market Closing Prices Yesterday

·     The S&P 500 Index slumped -72.04 points, or 1.57%, to 4,530.41

·     The Dow Jones Industrial Average fell -550.46 points, or 1.56%, to 34,678.35

·     The Nasdaq Composite tumbled -221.76 points, or 1.54%, to 14,220.52

·     The Russell 2000 Index declined -20.94 points, or 1.00% to 2,070.13

 

Economic Calendar for Today

·     8:30 AM ET        Nonfarm Payrolls for March…est. +490K

·     8:30 AM ET        Private Payrolls for March…est. +480K

·     8:30 AM ET        Manufacturing Payrolls for March…est. +30K

·     8:30 AM ET         Unemployment Rate for March…est. 3.7%

·     8:30 AM ET         Average Hourly Earnings m/m for March…est. +0.4%

·     8:30 AM ET         Average Weekly Hours worked for March…est. +5.5%

·     9:45 AM ET         Markit Manufacturing PMI, Mar-F

·     10:00 AM ET       ISM Manufacturing Index for March…est. 59.0

·     10:00 AM ET       Construction Spending for February…est. 1.0%

·     10:00 AM ET       Factory Orders m/m for February…est. (-0.6%)

·     10:00 AM ET       Durable Goods Orders m/m for February

·     1:00 PM EST       Baker Hughes Weekly rig count data

 

 

Macro	Up/Down	Last
Nymex	0.25	100.55
Brent	0.43	105.14
Gold	-17.00	1,927.00
EUR/USD	-0.0017	1.1051
JPY/USD	0.70	122.40
10-Year Note	+0.07	2.395%

 

 

World News

·     China (March) Caixin manufacturing PMI actual 48.1 vs 50.4 previous and below est. 49.9

·     Japanese Q1 Tankan Large Manufacturing Index beat: 14 vs 12 consensus; Japanese Q1 Tankan Large non-Manufacturing better at 9 vs 5 consensus

 

Sector News Breakdown

Consumer

·     GameStop (GME) shares rise 12% AH; said it intends to implement stock split through dividend

·     Li Auto Inc. (LI) reported March deliveries that more than doubled from a year ago; said March deliveries of its Li ONEs rose 125.2% to 11,034 vehicles, a slight deceleration in growth from recent months as Q1 deliveries grew 152.1% to 31,716 vehicles

·     Nio Inc. (NIO) delivered 9,985 vehicles in March, representing an increase of 37.6% y/y; delivered 25,768 vehicles in three months ended March 2022, increasing by 28.5% y/y; said plans to unveil 2022 NIO es8, es6 and ec6 with latest digital cockpit hardware in late May

·     Fisker (FSR) passes 40,000 reservations for Fisker ocean SUV and will open pre-orders for limited-edition Fisker Ocean one on July 1, 2022

·     Lulu’s Fashion Lounge Holdings (LVLU) 4Q adj EPS ($0.03) vs est. (0.07) on revs $97Mm vs est. $92.75Mm; sees FY revs $480-490Mm vs est. $472Mm

·     Chicken Soup for The Soul Entertainment Inc. (CSSE) 4Q adj EBITDA of $9.3Mm vs est. $6.1Mm on revs $36Mm vs est. $36.1Mm

·     Retail downgrades at Barclays: Wayfair (W) downgraded to Underweight from Equal Weight with $103 tgt at Barclays, Gap Stores (GPS) downgraded to Underweight and tgt cut to $13 from $17, American Eagle (AEO) downgraded to EW from OW and tgt to $19 from $24 and Urban Outfitters (URBN) downgraded to EW from OW and tgt to $29 from $34

 

Energy, Industrials and Materials

·     Allete (ALE) 3.2M share Spot Secondary priced at $63.00

·     Helix Energy (HLX) said it entered a new multi-year contract with Shell Offshore (SHEL) to provide Well Intervention services in the U.S. Gulf of Mexico.

·     Alta Equipment Group (ALTG) 4Q adj EPS $0.03 vs est. $0.04 on revs $356.3Mm vs est. $300.4M; guides FY adj EBITDA $137-142Mm, net of new equipment floorplan interest vs est. $130.9M

·     CF Industries (CF) said that the company plans to increase overseas shipments to regions plagued by fertilizer shortages, including Latin America, as supplies slow from Russia.

 

Financials

·     BGC Partners (BGCP) now sees Q1 revenue at midpoint of previous view $490M-$540M (est. $518.4M); now sees Q1 pre-tax Adjusted Earnings at midpoint of previous guidance of $105M-$125M

·     nCino, Inc. (NCNO) Q4 EPS loss (-$0.07), in-line with estimates while revs rose 32% to $75M vs. est. $92.75M; sees year revs $398M-$400M

 

Healthcare

·     ARCA biopharma (ABIO) shares fell -28%; after the company announced that its experimental COVID-19 therapy rNAPc2 failed to meet the primary endpoint with statistical significance in a Phase 2b trial

·     CTI BioPharma Corp. (CTIC) 4Q EPS ($0.38) vs est. ($0.28), expects current cash and equivalents to fund operations into 4Q22

·     DexCom (DXCM) said the new Dexcom ONE continuous glucose monitoring (CGM) system will launch in U.K. in May.

·     NGM Bio (NGM) announces initiation of phase 1/1b clinical trial of ngm831 for the treatment of patients with advanced solid tumors

·     Silverback Therapeutics (SBTX) announced that the company decided to discontinue its SBT6050 and SBT6290 clinical oncology programs; will instead focus its resources on chronic hepatitis B virus (cHBV) candidate, SBT8230, and ImmunoTAC discovery programs

·     Zimmer Biomet (ZBH) downgraded to Neutral from Buy at Citigroup

 

Technology, Media & Telecom

·     U.S.- listed Chinese stocks rise (BABA, BIDU, JD, TCEHY) following a Bloomberg News report that Chinese authorities are preparing to give U.S. regulators full access to auditing reports of most of the 200-plus companies listed in New York

·     Blackberry (BB) Q4 EPS $0.01 vs. est. loss (-$0.03); Q4 revs $185M vs. est. $208M; said its cybersecurity business saw another quarter of billings growth while cyber revs of $122M was flat year-over-year

·     Duck Creek Technologies (DCT) Q2 EPS $0.04 vs. est. $0.01; Q2 revs rose 22% to $76.4M vs. est. $72.6M; sees Q3 revs $71M-$73M vs. est. $75.9M and year revs $301M-$305M vs. est. $301.5M; SaaS Annual Recurring Revenue grew 28% year-over-year

·     Blend Labs (BLND) Q4 EPS (-$0.32) vs. est. (-$0.19); Q4 revs $81M vs. est. $81.1M; guides Q1 revs $63M-$66M vs. est. $75.8M; sees year revs $230M-$250M