Early Look

Tuesday, January 12, 2021

Futures	Up/Down	%	Last
Dow	76.00	0.25%	30,978
S&P 500	9.25	0.26%	3,801
Nasdaq	42.50	0.33%	12,939

 

 

Stocks are looking higher to start after the S&P 500 and Dow Industrials snapped their 4-day win streak on Monday (falling from record high levels), while the Nasdaq Composite underperformed led by Megacap weakness (AAPL, AMZN, FB, GOOGL, TSLA) in a day of profit taking, though major averages finished well off their morning lows. Commodity prices are strong after slipping Monday as gold and oil both looking much higher while the dollar takes a breather following its recent run off more than 2-year lows. Bitcoin prices make back roughly half of the prior day losses, up around 5% at 35,500 (touched lows around 30K yesterday before bouncing), but still well off the 42K highs late last week. Political drama in Washington continues after the House delivered an article of impeachment for President Trump citing “incitement of insurrection,” but major averages have not been phased. The risk mood appears to be back on today as Treasury yields edge higher (extending recent gains to best levels since March) while stocks and commodities edge higher. In Asian markets, The Nikkei Index rose 25 points to 28,164, the Shanghai Index gained 76 points to 3,608 and the Hang Seng Index jumped 368 points to 28,276. In Europe, the German DAX is little changed at 13,935, while the FTSE 100 is lower by -40 points to 6,755. Social media stocks also plunged Monday after banning President Trump from their platforms, but are all heading into the green this morning. Financials in focus later this week as earnings season gets under way Friday with results due from some of the biggest banks (JPM, C, WFC).

Market Closing Prices Yesterday

·     The S&P 500 Index dropped -25.07 points, or 0.66%, to 3,799.61

·     The Dow Jones Industrial Average fell -89.28 points, or 0.29%, to 31,008.69

·     The Nasdaq Composite slumped -165.54 points, or 1.25%, to 13,036.43

·     The Russell 2000 Index slipped -0.65 points, or 0.03% to 2,091.01

 

Events Calendar for Today

·     6:00 AM EST      NFIB Small Business Optimism for December

·     7:45 AM ET         ICSC Weekly Retail Sales

·     8:55 AM ET         Johnson/Redbook Weekly Sales

·     10:00 AM EST    JOLTs Job Openings for November

·     4:30 PM ET         API Weekly Inventory Data

 

Earnings Calendar:

·     Earnings Before the Open: ACI

·     Earnings After the Close: BBCP, KBH

 

Other Key Events:

·     Consumer Electronics Show (CES) 2021 (virtual), 1/11-1/14

·     ICR Conference 2021 (virtual), 1/11-1/14

·     JPMorgan Annual Healthcare Conference (virtual), 1/11-1/14

·     Needham Annual Growth Conference (virtual), 1/11-1/15

 

 

Macro	Up/Down	Last
Nymex	0.85	53.10
Brent	0.97	56.63
old	16.60	1,860.50
EUR/USD	-0.0006	1.2145
JPY/USD	-0.11	104.22
10-Year Note	+0.01	1.16%

 

 

Sector News Breakdown

Consumer

·     Walmart Inc (WMT) said it entered a strategic partnership with investment firm Ribbit Capital to create a new fintech startup (news sent shares of GDOT, MGI lower after the bell last night)

·     Abercrombie & Fitch (ANF) said it sees Q4 net sales down 5%-7% better than prior view of down 5%-10% (est. $1.12B), reflecting ongoing digital momentum offset by store closures and capacity restrictions in North America and EMEA

·     Fiesta Restaurant Group (FRGI) said Q4 Pollo Tropical comparable sales -8.2% compared to -11.1% in Q3, with November (-8.2%) at Pollo Tropical negatively impacted by Tropical Storm Eta

·     Limoneira (LMNR) Q4 adj EPS loss (42c) vs. est. loss (21c) and revenue $29.8M in-line with est. $29.2M; believes it is prudent to not provide lemon guidance at this time until the COVID-19 vaccine is widely distributed; expects to receive $80 million from Harvest at Limoneira during the next six fiscal years, beginning in fiscal 2022

·     NIO Inc. (NIO) announces $1.3B convertible senior notes offering

·     SoftBank Group’s Vision Fund sold 38 million shares of Uber (UBER) for $53.46 each, according to an SEC filing; it still remains Uber’s main shareholder, holding a 10% stake worth about $10 billion at current prices

 

Financials

·     Lemonade Inc (LMND) files for offering of 3.0M shares of common stock by co and 1.5M shares of common stock by selling stockholders

·     Cohen & Steers, Inc. (CNS) preliminary assets under management of $79.9 billion as of December 31, 2020, an increase of $3.2 billion from assets under management at November 30, 2020. The increase was due to net inflows of $1.4 billion and market appreciation of $2.2 billion, partially offset by distributions of $419 million.

·     Realty Income (O) 10.5M share Spot Secondary priced at $57.05

·     Postal Realty Trust (PSTL) 3.25M share Spot Secondary priced at $15.25

·     Redfin (RDFN) downgraded to Neutral from Buy at BTIG

 

Healthcare

·     Steris (STE) is in talks to combine with Cantel Medical Corp. (CMD), according to people familiar with the matter, in a deal that would bring together two big providers of sterilization products, said the WSJ. The companies are discussing a mostly stock deal that could be completed as soon as Tuesday, assuming talks don’t fall apart https://on.wsj.com/35vtC0Y

·     Agilent Technologies (A) said its outlook for Q1 2021 has improved as now sees core revenue growth to be at least in the high single digits range, compared to prior guidance of +3.5% to 4.5%

·     Becton Dickinson & Co. (BDX) provided an upbeat outlook for Q1 as it sees revs up 26% YoY to $5.3B vs. est. $4.7B; Medical segment revenue is set to increase 7.9% to $2.3B and life sciences revenue is expected to be up 76% to $2.0B; now expects full-year revenue growth to be at the “upper end” of its previous guidance range of high single to low double digits

·     Biogen (BIIB) disclosed a 10.7% stake in Sage Therapeutics (SAGE), representing 6.24M shares.

·     Boston Scientific (BSX) sees Q4 prelim sales about $2.71B vs. est. $2.86B, which represents a decline of about 6.8% on a reported basis and down 8% on organic basis

·     Luminex (LMNX) sees prelim Q4 revs $111M, above consensus $104.57M saying strength in molecular diagnostics continued, in advance of the continued expansion of our ARIES(R) manufacturing capacity

·     Adaptive Biotechnologies (ADPT) to collaborate with AstraZeneca (AZN) in mapping the immune response to cancer antigens to potentially inform the development of novel diagnostics and therapeutics

·     AMN Healthcare (AMN) sees Q4 revenue $623M-$628M (up from prior view $575M-$585M) and vs. est. $584.45M; also reaffirming its 2020 fourth quarter operating margin and adjusted EBITDA margin guidance

·     BeiGene (BGNE) announced a collaboration and license agreement with Novartis Pharma AG (NVS) to develop, manufacture and commercialize BeiGene’s anti-PD-1 antibody tislelizumab; co to get $650 mln upfront payment, eligible to get up to $1.55 bln in potential regulatory, sales milestone payments plus royalties on product sale

·     Bruker (BRKR) said it expects Q4 revenue $620M-$625M vs. $589.76M consensus which includes ~4.5% favorable impact from foreign currency; sees prelim year organic revenue growth in high single digits and non-GAAP EPS of at least $1.60

·     GenMark Diagnostics (GNMK) guides Q4 2020 revenue about $50M and FY revs about $171M vs. est. $45.8M and $167.4M respectively

·     Opiant Pharmaceuticals (OPNT) files for stock shelf of up to 1.3 mln shares of common stock

·     T2 Biosystems (TTOO) announced that its T2SARS-CoV-2 Panel, a molecular diagnostic test that detects SARS-CoV-2, the virus responsible for COVID-19 infections, is capable of detecting the multiple variants of the SARS-CoV-2 virus most recently identified in the United Kingdom, South Africa, and the United States

·     Vir Biotechnology (VIR) and GlaxoSmithKline (GSK) announced an agreement with the U.K.-based AGILE initiative to evaluate VIR-7832 in patients with mild to moderate COVID-19 in a Phase 1b/2a clinical trial

 

Industrials & Materials

·     Matson Inc (MATX) said it expects Q4 net income and diluted eps to be $76.1M-$81.6M and $1.74 to $1.87 (est. $1.08), respectively; as pandemic subsides with widespread vaccination, expect some of supply & demand factors co is currently benefitting from to remain

·     Steel industry and union groups on Monday urged President-elect Joe Biden to keep in place the 25% national security tariffs on steel imports imposed in 2018 by his predecessor, arguing they are essential to ensure the viability of domestic steel production (X, NUE, STLD) – Reuters

·     Commercial Metals (CMC) downgraded to Underperform from Neutral at Bank America

 

Technology, Media & Telecom

·     Acacia Communications (ACIA) prelim Q4 EPS 88c-97c above est. 75c and prelim Q4 revenue $160M-$164M vs. est. $162.24M

·     ANGI HomeServices (ANGI) total revenue rose 12% from the prior December, with Marketplace revenue rising 15%, and advertising and other revenue up 4%

·     DocuSign (DOCU) files to sell $500M of convertible senior notes due 2024

·     Pixelworks (PXLW) announced the company and TCL have signed a new multi-year collaboration agreement to leverage Pixelworks display innovations in future smartphone models across a wider range of price points

·     SYNNEX (SNX) Q4 adj EPS $5.21 on revs $7.41B (from $6.58B YoY) vs. est. $3.83 and $6.57B; guides Q1 EPS $1.34-$1.55 on revs $4.5B-$4.8B and resumes quarterly dividend

·     VOXX (VOXX) Q3 EPS 74c vs 10c last year and Q3 revenue $201.1M vs $110.1M last year

·     Zoom Video (ZM) files automatic mixed securities shelf