Early Look

Tuesday, April 2, 2024

U.S. futures down overnight after slipping on Monday, pressured by weakness in insurance stocks (UNH, CNC, ELV, HUM) as the U.S. government’s unchanged reimbursement rates for providers of Medicare Advantage health plans signaled that insurers’ margins would likely remain under pressure next year. Energy stocks looking higher, building on Monday gains as WTI crude hits $85 per barrel and Brent above $90 per barrel for the first time since October. The U.S. 10-yr yield rose 12.7bps on Monday to 4.321% and adding again this morning, rising another 3-bps to 4.35% after stronger-than-expected ISM data prompted traders to pare back bets on interest rate cuts by the Federal Reserve. Bitcoin prices down over -5% to $66,000 and Ethereum -4.6% to $3,335 as crypto stocks tumble. In Asian markets, The Nikkei Index rose 35 points to 39,838, the Shanghai Index dipped -2 points to 3,074, and the Hang Seng Index jumped 390 points to 16,931. In Europe, the German DAX is down -18 points to 18,474, while the FTSE 100 rises about 28 points to 7,981. Data expected on Tuesday includes factory orders and job openings in February. However, the focus is on Friday’s U.S. non-farm payrolls data. A host of Fed officials including New York Fed President John Williams, Cleveland Fed President Loretta Mester and San Francisco President Mary Daly are scheduled to speak later in the day.

• The Dow Jones Industrial Average fell -240.52 points, or 0.60%, to 39,566.85.
• The Nasdaq Composite gained 17.37 points, or 0.11%, to 16,396.83.
• The Russell 2000 Index declined -20.71 points, or 0.97% to 2,103.84.

• 8:55 AM ET                  Johnson/Redbook Weekly Sales
• 10:00 AM ET                Factory Orders M/M for February
• 10:00 AM ET                JOLTs Job Openings for February…est. 8.74M (prior 8.863M)
• 10:00 AM ET                Durable Goods Orders M/M for February
• 12:00 PM ET                Fed’s Williams Moderates Discussion at Economic Club of NY
• 12:05 PM ET                Fed’s Mester Gives Remarks on Economic Outlook
• 1:30 PM ET                   Fed’s Daly Participates in Fireside Chat
• 4:30 PM ET                   API Weekly Inventory Data

• Earnings After the Close: CALM PLAY

• JP Morgan 10th Annual Retail Round-up, 4/2-4/4, in New York
• China Caixin Services PMI for March

• Estee Lauder (EL) to Buy from Neutral at Citigroup as it believes the company is nearing a topline inflection point as channel inventories in Asia Pac Travel Retail are normalizing and EL is closer to balanced sell-in/sell-through.
• PVH Corp. (PVH) shares slide -20%; Q4 adj EPS $3.72 vs est. $3.53 on revs $2.49B vs est. $2.42B; guides FY24 revs -6% to -7% inclusive of 2% reduction from sales of Heritage Brands business and 1% reduction from 53rd week in 2023 vs est. -1%, sees FY24 op mgn approx flat vs 10.1% and EPS $10.75-11.00 vs est. $12.08; sees Q1 revs approx -11% (-3% from sales of Heritage Brands) vs est. -3.7% and EPS approx $2.15 vs est. $2.59.
• Smith & Wesson (SWBI), Stur Ruger (RGR): U.S. unadjusted criminal background checks rose 7.6% to 2.63 million in March, according to data from the FBI’s NICS data vs. y/y checks decreased 14% from 3.04 million.
• Tesla (TSLA) sold 89,064 China-made electric vehicles in March, a 0.2% increase from a year earlier, China Passenger Car Association (CPCA) data showed.

• Array Technologies (ARRY) upgraded to Overweight from Equal Weight at Barclays.
• Nextracker (NXT) downgraded to Equal Weight from Overweight at Barclays.

• UBS (UBS) said it was launching a new share buyback program of up to $2 billion, with up to half being completed in 2024.

• Acorda Therapeutics (ACOR) filed for Chapter 11 bankruptcy protection; ACOR entered into an asset purchase agreement with Germany based Merz Therapeutics to buy substantially all the assets of Acorda, including rights to its drugs Inbrija, Ampyra and Fampyra for $185 million.
• Cannabis stocks (MSOS, CGC, TLRY) moving higher this morning after the Florida Supreme Court approved an initiative to legalize recreational marijuana and make it appear on ballot in November.
• Danaher (DHR) files automatic mixed securities shelf.
• Figs (FIGS) downgraded to Underperform from Neutral at Bank America.

• Warner Bros Discovery (WBD) said independent directors Steven Miron and Steven Newhouse had resigned from its board on Monday after U.S. antitrust authorities began probing their service as directors of a competing media company.