Morning Preview: December 18, 2023

Early Look

Monday, December 18, 2023









S&P 500










U.S. futures pointing to another higher open, building on last week gains as major averages try to make it an 8th straight week of stock market gains. U.S. stocks finished mostly higher on Friday as the Nasdaq 100 Index hit a new all-time high led by big tech stocks rally and the Dow Jones Industrial Average logged its 3rd straight record high after the Federal Reserve signaled midweek that its aggressive rate-hikes to contain inflation are over and cuts are on the table for 2024 and 2025. The S&P 500 ended the week higher by +2.5%, the Nasdaq composite +2.8%, the Dow climbed +2.9% and the Russell 2000 roughly +5%. The S&P 500 saw its longest weekly winning streak since November 2017, now at 7-weeks. Its also interesting to note that the S&P 500 is now 8% higher than where it was when the Fed started hiking rates in March 2022, as per @ Charlie Bilello. Oil prices snapped their 7-week losing streak on Friday while Treasury yields tumbled last week with the 2-yr yield down -27 bps to 4.455% (down -76-bps from 52-week high on 10/18/23. The 10-yr yield fell -31.7-bps this week to 3.927% (YTD +10bps) but down -106-bps from 52-week high 4.987% on 10/19. The 30-yr yield falls nearly -30-bps this week to 4.026% (lowest since July) and is down -107-bps from 52-week high of 5.101% on 10/19. Nearly all of the S&P 500’s 11 sectors were up last week in a broad-based rally, while small-capitalization stocks have seen a stronger rally than large-cap equities. Note the S&P 500 is not far off its record close, reached Jan. 3, 2022. In Asian markets, The Nikkei Index dropped -211 points to 32,578, the Shanghai Index fell -11 points to 2,930, and the Hang Seng Index fell -162 points to 16,629. In Europe, the German DAX is down -53 points to 16,697, while the FTSE 100 is up 40 points to 7,617. Two Federal Reserve officials on Friday pushed back on growing expectations in financial markets for the central bank to cut interest rates as soon as March, but again failed to hurt sentiment. What will this week bring?


Market Closing Prices Yesterday

·     The S&P 500 Index was little changed, or down 0.01%, to 4,719.19.

·     The Dow Jones Industrial Average rose 56.81 points, or 0.15%, to 37,305.16.

·     The Nasdaq Composite gained 52.36 points, or 0.35%, to 14,813.92.

·     The Russell 2000 Index declined -15.39 points, or 0.77% to 1,985.13.


Economic Calendar for Today

·     10:00 AM ET                NAHB Housing market Index for December


Earnings Calendar:

·     Earnings Before the Open:

·     Earnings After the Close: HEI JOB





















10-Year Note





Sector News Breakdown


·     Blink Charging (BLNK) shares edge higher after billionaire Kenneth Griffin’s Citadel hedge fund takes a 0.4% stake in BLNK, according to a regulatory filing.

·     Bluegreen Vacations Holding (BVH) announced the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, with respect to the previously announced agreement for the Company to be acquired by Hilton Grand Vacations (HGV) for $75.00 per share in cash.

·     Nio (NIO) rises after entering into an agreement to receive $2.2 bln in cash from Abu Dhabi-based investor CYVN Holdings, which has already invested over $1 bln in Nio earlier this year. CYVN will own about 20.1% of Nio’s total outstanding shares after the investment closes.

·     Shoe Carnival (SCVL) announces new $50M share buyback program.

·     Wyndham Hotels & Resorts (WH) urges shareholders to reject the inadequate and highly conditional Choice Hotels (CHH) merger.


Energy, Industrials, and Materials

·     Japan’s Nippon Steel to buy U.S. Steel (X) in a deal worth $14.9 billion, including debt; the per-share offer of $55 represents a 40% premium to U.S. Steel’s closing stock price on Dec. 15.

·     Sunnova Energy (NOVA) upgraded to Buy from Neutral at Goldman Sachs.

·     SolarEdge (SEDG) downgraded to Sell from Neutral at Goldman Sachs.



·     Citigroup (C) reported charge-offs for November of 2.21% and delinquencies 2.86%.



·     Arcutis Biotherapeutics (ARQT) shares rose late Friday after the FDA approves its drug for treating a skin condition called seborrheic dermatitis in individuals nine years of age and older.

·     Bristol Myers Squibb Co. (BMY) said it will discontinue its Phase 3 RELATIVITY-123 trial of combo treatments nivolumab and relatlimab in patients with metastatic colorectal cancer due to a low probability of success.

·     Illumina Inc. (ILMN) said it will sell its Grail unit, after a federal appeals court on Friday found the $7.1 billion acquisition in 2021 to be anticompetitive. Illumina said it will divest Grail and will not appeal the court’s decision.


Technology, Media & Telecom

·     Apple (AAPL) shares dropped late Friday after Bloomberg News reported that more Chinese agencies and government-backed firms across the country have ordered staff to stop bringing iPhones and other foreign devices to work.

·     Alibaba (BABA) mentioned positively in Barron’s noting shares dropped 18% in 2023 after scrapping plans for an IPO of its cloud software business amid US chip export restrictions, but the company has a significant amount of cash on hand.

·     Ebix (EBIX) shares fall -50% after filing for Chapter 11 bankruptcy protection in North Texas court; the company lists both estimated assets and liabilities in the range of $500M-$1B.

·     Madison Square Garden Sports (MSGS) mentioned positively in Barron’s noting the company owns the New York Knicks and the Rangers, and the current market value is roughly half of Sportico estimates of the teams’ combined worth. Some investors say a stock buyback or sale of the company could yield a big payoff to shareholders.

·     Open Text Corp (OTEX) files mixed securities shelf.

·     Snap (SNAP) upgraded to Buy from Neutral at Guggenheim with $23 tgt.


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.