Mid-Morning Look: September 25, 2023

Mid-Morning Look

Monday, September 25, 2023





DJ Industrials




S&P 500








Russell 2000






U.S. stock futures are mixed after pointing to a very weak opening initially. Stocks pressured as Treasury yields moved to new cycle highs (10-yr yield 4.53% this morning) along with a 10-month high for the U.S. dollar. The Nasdaq and S&P 500 both come into the Monday with 3-week losing streaks as higher rate hike expectations by the Fed and rising Treasury yields/US dollar have pushed interest rate sensitive sectors and growth stocks lower. Also fears of a government shutdown remain into the October 1st deadline to fund the government. We are six days away until the potential government shutdown begins as Congress currently has no plan on the table right now. No real break-though in the UAW union strike for GM and STLA this weekend while the writers strike in Hollywood reached a tentative agreement. The U.S. imposed trade restrictions on additional Chinese, Russian companies this morning over scheme to supply Russia with components to make drones, the Commerce Department reported. Stock news flow very slow to start the week, with no major earnings or economic data on this Yom Kippur holiday. Note the SPY is down -3% in the last 5-day losing streak to the lowest since early June. The US dollar is right back to highs, holding above last week’s high, +0.35% to 105.96 makes the highest since 11-30-22.






WTI Crude















10-Year Note





Sector Movers Today

·     In Chemicals: FMC downgraded from Buy to Neutral w/ $98 PT at Redburn saying considering recent developments in industry-wide sales volumes of crop chemicals and the apparent confidence by investors in the strength of FMC’s IP protection, believes more earnings downgrades are likely and there is too much uncertainty. DOW was upgraded from Neutral to Overweight at JP Morgan as think the recent downward movement in equity values has given investors an opportunity to purchase Dow shares at a reasonable valuation.

·     In Refiners: TDCowen raises price targets on DINO $51 (Prior $48) DK $25 (Prior $21) MPC $159 (Prior $142) PARR $41 (Prior $39) PBF $48 (Prior $36) PSX $134 (Prior $123) VLO $151 (Prior $137) as models 9% upside to 3Q23 EBITDA and 15% 4Q23 as cracks should remain supported into 2024 given low diesel inventories into peak demand season. See PBF most upside for 3Q and PSX most of large caps with MPC least. Combining 3Q and 4Q23, PBF and PARR have most upside vs least for large caps MPC, PSX and VLO.

·     Apparel retailers URBN, NKE, FL all downgraded to Hold from Buy at Jefferies warns of a “significant risk to consumer spending ahead,” from the looming resumption of student loan payments, which restart on Oct. 1. They surveyed U.S. consumers with outstanding student loan debt and found that 90% are “at least somewhat concerned about being able to meet all of their monthly expenses, while apparel, footwear, accessories, restaurants, and big-ticket items are likely to see the biggest pullbacks in spending.”



·     AMZN +1%; is said to invest as much as $4 billion in AI startup Anthropic, Bloomberg.

·     DOW +2%; upgraded from Neutral to Overweight at JP Morgan as think the recent downward movement in equity values has given investors an opportunity to purchase Dow shares at a reasonable valuation.

·     KMX +1%; was upgraded to Outperform from Neutral at Wedbush and raised tgt to $90 from $85 saying the company is near an inflection point in growth and market share performance.

·     SEE +4%; was upgraded to Buy at Citigroup with $41 PT citing line-of-sight to +MSD% EBITDA growth Y/Y in ’24 on easier-to-achieve cost saves and vol inflection, supportive valuation, and potential for portfolio actions to move the needle.

·     STLD +1%; was upgraded alongside CLF to Buy at Citigroup as believes U.S. flat rolled prices will rebound into year-end and steel company valuations are relatively attractive.



·     ALEC -13%; was initiated at Sell and $4 tgt at Goldman Sachs as sees significant risk to the company’s lead clinical stage programs, latozinemab AL002 (Alzheimer’s disease).

·     CCL -2%; Bank America said based on prices pulled in early September, average sequential pricing decelerated for CCL (-1.4%) and NCLH (-7.8%), while accelerating for RCL (+2.2%) vs. August.

·     CHRS -8%; after the FDA declined to approve its drug delivery device for Udenyca, a therapy that lowers chemotherapy-related infections.

·     MMM -2%; said it was evaluating whether there are options to restart its idled PFAS manufacturing processes at its Zwijndrecht, Belgium facility.

·     NIO -6%; denied overnight reports that it is considering raising around $3 bln from investors, initially reported by Bloomberg News. Report had said NIO had approached investors from the Middle East and the fundraising may happen as soon as next year.

·     RAD -15%; after saying on Friday said it expects to close roughly 400 to 500 stores in bankruptcy, and either sell or let creditors take over its remaining operations – WSJ reported.


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.