Early Look

Thursday, April 17, 2025

U.S. futures are mixed as S&P futures (Spuz) rise +0.5% at 5,335 as late Wednesday (overnight low 5,293.25 and high 5,371.25), as President Donald Trump cited “big progress” in Japan trade talks, though the two sides did not discuss currencies, but noted a second round of talks should take place later this month. Dow futures slide however after Dow component and managed care giant United Health (UNH) reported a top and bottom line miss amid rising costs and slashed its annual profit outlook, sending shares down over -20%. In macro news, President Trump talking about rates, tweeting on Truth Social, “The ECB is expected to cut interest rates for the 7th time, and yet, “Too Late” Jerome Powell of the Fed, who is always TOO LATE AND WRONG, yesterday issued a report which was another, and typical, complete “mess!” Oil prices are down, groceries (even eggs!) are down, and the USA is getting RICH ON TARIFFS. Too Late should have lowered Interest Rates, like the ECB, long ago, but he should certainly lower them now. Powell’s termination cannot come fast enough!” Currently, Treasury yields are down slightly at 4.3%, gold dips slightly off record highs and the dollar is flat. Oil futures rose for a second day after the Trump administration again vowed to reduce Iran’s energy exports to zero, while talks between the US and Japan stirred optimism that agreements on trade can be reached. Homebuilders look weak early after DHI results and guidance while semi chips hope to bounce after falling -4% on Wednesday after TSM results beat and issued better guidance. Ahead of the long weekend, all three major Wall Street indexes are on track for weekly losses, with the S&P 500 on pace to lose about -1.6%.

The three major U.S. stock indexes closed sharply lower on Wednesday on the semiconductor weakness and then Fed Chair Jerome Powell said that while the U.S. economy is still in a solid position, growth appears to be slowing. Shares of NVDA, AMD, were among the biggest decliners yesterday in tech after the companies flagged steep charges from new U.S. curbs on chip exports to China, fueling worries about the fallout of an escalating trade war. Also, the Trump administration is weighing penalties that would block China’s DeepSeek from buying U.S. technology and debating barring Americans’ access to its services, the New York Times reported on Wednesday. Later this morning, the European Central Bank (ECB) is widely expected to cut its key rates by 25 basis points on Thursday, taking the deposit rate to 2.25%. The risks posed to economic growth from U.S. tariffs, coupled with slowing inflation, should enable the ECB to ease monetary policy both this month and in the months to come according to reports. In Asian markets, The Nikkei Index jumped 457 points to 34,377, the Shanghai Index gained 4 points to 3,280, and the Hang Seng Index climbed 338 points to 21,395. In Europe, the German DAX is down -112 points to 21,198, while the FTSE 100 is down -62 points to 8,213 ahead of the ECB policy meeting this morning.

• The Dow Jones Industrial Average fell -699.57 points, or 1.73%, to 39,669.39
• The Nasdaq Composite dropped -516.01 points, or 3.07%, to 16,307.16
• The Russell 2000 Index declined -19.44 points, or 1.03% to 1,863.48

• 8:30 AM EST                Continuing Claims…est. 1.872M
• 8:30 AM EST                Philly Fed Business Index for April…est. 2.0 (prior 12.5)
• 8:30 AM EST                Housing Starts M/M for March…est. 1.42M (prior 1.5M)
• 8:30 AM EST                Building Permits M/M for March…est. 1.446M (prior 1.459M)
• 10:30 AM EST              Weekly EIA Natural Gas Inventory Data

• Earnings After the Close: INDB MRTN NFLX

• DR Horton (DHI) Q2 adj EPS $2.58 (vs. est. $2.70) on revs $7.70B (missing the est. $8.05B) as pretax Profit $1.10B (below est. $1.12B); lowers FY revs view to $33.3B-$34.8B, from prior $36.0B-$37.5B and said sees FY homes closed 85K-87K, from prior 90K-92K.
• Hooker Furnishings (HOFT) Q4 sales increased 21.7% to $104.5M while posts net loss of $2.3M, or 22 cents per share, compared with a profit of $593M, or 6 cents per share, a year ago; says the planned exit of Savannah warehouse is expected to save $4 million to $7 million annually beginning in fiscal 2027

• CSX Corp. (CSX) Q1 EPS $0.34 vs est. $0.37 on revs $3.42B vs est. $3.466B; said declines in coal rev, fuel surcharge and merchandise volume only partially offset by the effects of higher merchandise pricing and growth in intermodal volume; Q1 total volume of 1.52 million units for the quarter was 1% lower y/y.
• Diamondback Energy (FANG) Q1 average production of 475.9 mboe/d (850.7 mboe/d); should low commodity prices persist or worsen, have flexibility to reduce activity to maximize FCF generation.
• Enphase Energy (ENPH) downgraded to Sell from Neutral at Citigroup and cut tgt to $47 from $65.
• Kinder Morgan (KMI) Q1 adj EPS $0.34 vs. est. $0.36; Q1 revs $4.24B vs. est. $4.03B; backs FY25 adjusted EPS view $1.27 vs. est. $1.28; budgeted 2025 Adjusted EBITDA of $8.3B, up 4% y/y; said landscape for natural gas continues to be more and more favorable; raises quarterly dividend to 29.25c per share from 28.75c.
• Transocean Ltd. (RIG) issued a quarterly Fleet Status Report that provides the current status of, and contract information for, the company’s fleet of offshore drilling rigs. As of April 16, 2025, the company’s total backlog is approximately $7.9 billion.
• Viper Energy (VNOM) said Q1 average production of 31,311 boe/d. Average unhedged realized prices of $71.33 per barrel of oil, $24.52 per barrel of natural gas liquids and $2.08 per Mcf of natural gas Average hedged realized prices of $70.26 per barrel of oil, $24.52 per barrel of natural gas liquids and $3.74 per Mcf of natural gas. Realized commodity hedging gains of $9.1M.

• Bank Ozk (OZK) Q1 EPS $1.47 vs est. $1.41; Q1 net income $167.9M vs. est. $161.2M.
• Banner Corp. (BANR) Q1 adj EPS $1.29 vs est. $1.22 on NII $141.083Mm vs est. $140.22Mm, credit loss provision $3.139Mm, adj revs $159.9Mm vs est. $140.6Mm.
• First industrial Realty (FR) Q1 revs $177.07Mvs. est. $176.3M; Q1 adj FFO $0.68 vs. est. $0.70.
• FNB Corp. (FNB) Q1 EPS $0.32 vs est. $0.30 on NII $323.845Mm vs est. $322.41Mm, credit loss provision $17.489Mm.
• KeyCorp (KEY) Q1 EPS $0.33 vs. est. $0.32; Q1 revs $1.77B vs. est. $1.75B; Q1 net interest income grew 4% and the net interest margin increased by 17 basis points to 2.58%.
• Rexford Industrial (REXR) Q1 core FFO/SHR $0.62 vs est. $0.58 on revs $252.3Mm vs est. $244.74Mm; guides FY core FFO/SHR $2.37-2.41 vs est. $2.41 and prior guide $2.37-2.41.
• SL Green Realty (SLG) Q1 FFO/SHR $1.40 vs est. $1.31 on rental revs $144.518Mm vs est. $153.37Mm.
• Truist Financial (TFC) Q1 EPS $0.87 vs. est. $0.86; Q1 revs $4.95B vs. est. $4.94B; Net interest income increased to $3.56 billion from $3.43 billion. Net interest margin was 3.01%, down six basis points; the bank’s provision for credit losses declined to $458 million from $500 million in the prior year period.

• Eil Lilly (LLY) shares rise after announcing positive topline Phase 3 results from ACHIEVE-1, evaluating the safety and efficacy of orforglipron compared to placebo in adults with type 2 diabetes and inadequate glycemic control with diet and exercise alone. Orforglipron is the first oral small molecule glucagon-like peptide-1 (GLP-1) receptor agonist, taken without food and water restrictions, to successfully complete a Phase 3 trial.
• Novo Nordisk’s (NVO) was downgraded to Market Perform from Outperform at BMO Capital and cut tgt to $64 from $105 saying Novo’s “first mover advantage” with semaglutide, the active ingredient in its weight loss and diabetes drugs, has waned with Lilly’s tirzepatide taking share rapidly.

• Quantum Computing (QUBT) announced that the Chief Executive Officer and President, Dr. William McGann has notified the Board his intention to retire effective May 12, 2025.