Early Look

Monday, January 22, 2024

U.S. futures are pointing to a new record high for major averages after the S&P 500 notched a record close Friday for the first time in more than two years and the Dow notched its second record close of the year. Nasdaq futures also pushing to new all-time highs in what has been a monstrous rally since the end of October of 2023, boosted by hopes of several aggressive interest rate cuts by the Fed in 2024. However, three Federal Reserve officials on Friday emphasized that incoming data would guide their decision on when to cut interest rates and made clear they haven’t seen enough evidence yet to begin easing. However, the downplaying of rate cuts has yet to spark and stock market concerns with the breakout to new highs last Friday. Confidence has been pushing higher as evident in Friday’s University of Michigan’s consumer sentiment index which rose 9.1 points to 78.8, the biggest monthly advance since 200. In Asian markets, The Nikkei Index jumped 583 points to 36,546, the Shanghai Index fell -75 points to 2,756, and the Hang Seng Index tumbled -347 points to 14,961. In Europe, the German DAX is up 85 points to 16,629, while the FTSE 100 rises 13 points to 7,475. In stock news, ADM shares tumbled after saying they put their CFO on administrative leave as it investigates accounting at its nutrition segment. In politics, Ron DeSantis suspended his Republican presidential campaign on Sunday. Earnings season got underway last week, but the volume picks up this week with several tech names.

• The Dow Jones Industrial Average rose 395.19 points, or 1.05%, to 37,863.80.
• The Nasdaq Composite surged 255.32 points, or 1.70%, to 15,310.97.
• The Russell 2000 Index advanced 20.74 points, or 1.08% to 1,944.39.

• Earnings After the Close: AGNC AGYS BRO CFB EFSC GSBC HBCP IBTX RBB SMBK TRST UAL ZION

• Jefferies Winter Consumer Summit, 1/22-1/23, in CO

• President Joe Biden said he is open to “massive changes” in US border policy, including to asylum laws, to secure a deal that would unlock Ukraine aid. Biden’s comments mark the most detailed offer he has made publicly regarding negotiations to break a months-long standoff over the border and foreign aid – Bloomberg.

• Archer Daniel (ADM) said CFO under administrative leave as it investigates its accounting practices; expects to delay its earnings release and conference call relating to fourth quarter and full year 2023 financial results, as well as the filing of its Annual Report on Form 10-K for the year; now expects to deliver above $6.90 in adjusted EPS for the FY below consensus of $7.28.
• JetBlue Airways Corp. (JBLU) and Spirit Airlines Inc. (SAVE) said they are appealing a federal judge’s ruling blocking their planned $3.8 billion merger in a last-ditch effort to save a deal that many analysts believe is dead.

• SolarEdge Technologies Inc. (SEDG) said it will lay off about 16% of its workforce, about 900 employees, as part of a restructuring to slash operating costs.
• Tilly’s (TLYS) announced that, effective January 22, Ed Thomas has retired from his position as President and CEO and as a director of the company
• Waste Connections Inc. (WCN), Oshkosh Corp. (OSK) featured by Barron’s round-table experts highlighted these companies among their 2024 stock picks. Waste Connections “trades at a far narrower premium to other industrials than it has in the past and at a 10% discount to where it has traded historically versus the market,” said David Giroux, head of investment strategy at T. Rowe Price. Oshkosh “generated revenue of about $9.7 billion last year, which could grow to $10.2 billion this year,” said Scott Black, president of Delphi Management

• Coherus BioSciences (CHRS) shares rise pre mkt after striking a deal to sell its Cimerli ophthalmology franchise to Swiss pharmaceutical company Sandoz for $170 million in cash.
• Gilead Sciences Inc. (GILD) won final approval on Friday to pay $246.75 million to end allegations that anticompetitive conduct forced direct purchasers to pay more for drugs used to treat and prevent HIV.

• Panasonic’s (PCRFY) battery business must focus on boosting productivity, Group CEO Yuki Kusumi told Reuters, signaling the Tesla supplier may hold off building a third battery plant in North America as demand for electric vehicles cools.