Mid-Morning Look: March 29, 2023

Mid-Morning Look

Wednesday, March 29, 2023






DJ Industrials




S&P 500








Russell 2000






U.S. stock markets rebound after a boring day on Tuesday (SPX traded in a daily range of only 0.70% yesterday, the smallest range since the day after Thanksgiving in 2022), with all eleven S&P sectors firmly higher, including a rebound in tech after a small 2-day bout of profit taking. Month and quarter end “window dressing” by portfolio managers helping major averages extend gains. The S&P (SPX) moves back above 4000, while the VIX extends recent losses to 19.00 – S&P now up 200 points from lows on 3/13 and VIX down 12 handles from highs (since March 13th). Given market optimism that the Fed will lower interest rates in coming meetings and that the banking system contagion fears from SIVB/SBNY failures are easing, investors in full blown “risk-on” attitude to end the month. The S&P 500 (SPX) has been stuck in trading range last few weeks, now approaching upper end of it at the 50-day moving average (4,013). Signs of massive risk on remain with Bitcoin jumping 4% back above $28K, shrugging off regulatory crackdowns in the space after Binance headlines this week. Lululemon shares surge after reported 4Q earnings and sales that beat analyst expectations and issued better-than-expected guidance. Even bad results being rewarded as chip maker Micron (MU) shares rise over 6% after suggested the industry’s downturn may have hit bottom (reported a $2.3B loss for its most recent period and forecast another loss in its current quarter on plunging margins). The benchmark 10-year yield rises to 3.60%, commodity prices higher, dollar higher. Zero fear early on.







WTI Crude















10-Year Note





Sector Movers Today

·     In retail: LULU surges after quarterly beat and raise; UBS downgraded ROST, BURL, URBN, FL to Sell; and BBWI to Neutral in Softline retail, saying they have become increasingly bearish on the sector; cuts targets on 17 names in space and reduce CY23 EPS estimates across our coverage by 10%, on average. The call weighed on various other retailers on day.

·     Bank news: UBS rehired Sergio Ermotti as CEO to steer its massive takeover of neighbor Credit Suisse (CS) in a surprise move to take advantage of the Swiss banker’s experience rebuilding the bank after the global financial crisis. Senate probe alleges Credit Suisse (CS) helped Americans commit tax fraud – CNBC reported. Wyden investigation finds Credit Suisse complicit in ongoing tax evasion by ultra-wealthy Americans -united states Senate committee on finance.



·     ARCT +18%; after Q4 results as EPS $4.33 tops est. $0.98; Q4 revs $160.3M vs. est. $72.68M and provides pipeline progress; co repaid debts that allow its “cash runway” to extend to 2026.

·     BA +1%; as RYAAY CEO says expects BA 737 max 7 to be certified in first half, expects 737 max 10 to be certified towards end of this year. RYAAY says back in talks with BA for 100 new airplanes.

·     CALM +9%; Q3 EPS $6.62 above Consensus $5.47, with revenue above and said dozen Eggs Sold 291,416 vs year-ago 287,651.

·     ILMN +4%; activist investor Carl Icahn wants change at the management level, and he has a candidate in mind for the top spot: former CEO Jay Flatley – WSJ https://on.wsj.com/40HwzFN

·     LULU +15%; Q4 comps +30% (beating high end of implied guidance by 300bps) and EPS of $4.40 (vs. guidance $4.22-$4.27) and guided above the Street for both Q1 and the FY: for Q1, they expect net revenue growth of 17-20% (vs. est. +14%) and EPS of $1.93-$2.00 (vs. est. of $1.64).

·     MU +6%; rises on AI optimism, cut its capex target to $7B for FY23, the lower end of its prior range; it also raised its headcount reduction target to 15% from 10% for this year said the memory chip industry would see a record calendar year in 2025 – offsetting a dismal quarter and lower guidance for revs and margins.

·     NMRK +6%; after the WSJ reported that the FDIC hired the company to sell about $60 billion of Signature Bank loans. https://on.wsj.com/3nlCgL0

·     PAYX +4%; following earnings and guidance.

·     SSYS +9%; after NNDM said it increased its bid to buy the fellow 3D printer maker to $19.55 a share, which represents a 38.6% premium to Tuesday’s closing price of $14.11, and is up from the previous bid of $18 a share https://on.mktw.net/40O0MmF



·     BBWI -2%; downgraded along with FL, URBN at UBS in Softline sector.

·     BLUE -25%; said it expects delay on FDA Sickle Cell Drug Application after reports Q4 results.

·     CONN ; Q4 adjusted EPS loss (-$1.53) vs. est. loss (-$0.87); Q4 revs $334.9M vs. est. $331.22M; Q4 same store sales decreased (-21.8%).

·     M -2%; said that Jeff Gennette, chairman and CEO, will retire next February after a 40-year run at the retailer; shares also downgraded at Gordon Haskett.

·     PLAY -3%; Q4 comps of +19% beat by +180bps and were up +14.1% vs 2019, while cost of sales were 20bps lower than expected.

·     SHCR -25%; slides following mixed Q4 as co posted a slight beat to Q4 revenue and slight miss to EBITDA and guides 2023 below views.

·     STEM -15%; after offering privately $175 mln convertible bonds due 2030.


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.