Early Look

Wednesday, June 7, 2023

Futures	Up/Down	%	Last
Dow	-16.00	0.05%	33,601
S&P 500	1.25	0.02%	4,290
Nasdaq	-7.50	0.05%	14,579

 

 

U.S. futures are looking flat, holding steady just shy of the 4,300 level for the S&P 500 despite weaker China monthly trade balance data. China May Exports fell -7.5% y/y vs -0.4% consensus; Imports fell -4.5% y/y vs -8.0% consensus and the China May Trade Balance $65.8b vs $92b consensus. Meanwhile the Organization for Economic Cooperation and Development (OECD) said global economic growth will pick up only moderately over the next year as the full effects of central bank rate hikes are felt, expected to rise 2.7%, up from its previous forecast of 2.6% in March. Growth would then accelerate only slightly next year to 2.9% – unchanged from March’s forecast. In Asian markets, The Nikkei Index tumbled -593 points or 1.82% to 31,913, the Shanghai Index was little changed at 3,197, and the Hang Seng Index gained 152 points to 19,252. In Europe, the German DAX is down -20 points to 15,971, while the FTSE 100 is up 10 points to 7,637. So far this week, markets look to be in a holding pattern ahead of next week’s FOMC policy rate meeting on Wednesday, with the 10-year yield holding around 3.7% and the S&P around the 4,300 level on a weaker dollar.

 

Market Closing Prices Yesterday

·     The S&P 500 Index climbed 9.94 points, or 0.23%, to 4,283.73.

·     The Dow Jones Industrial Average rose 10.42 points, or 0.03%, to 33,573.28.

·     The Nasdaq Composite gained 46.99 points, or 0.36%, to 13,276.42.

·     The Russell 2000 Index advanced 48.69 points, or 2.69% to 1,855.40.

 

Economic Calendar for Today

·     7:00 AM ET              MBA Mortgage Applications Data

·     8:30 AM ET              International Trade for April…est. (-$75.2B)

·     10:30 AM ET            Weekly DOE Inventory Data

·     3:00 PM ET               Consumer Credit for April…est. $22.0B

 

Earnings Calendar:

·     Earnings Before the Open: BF/B CPB JILL LOVE OLLI UNFI VRA

·     Earnings After the Close: CURV GEF GME HCP LAKE RENT OXM SMAR SMTC VRNT

 

Other Key Events:

·     Apple (AAPL) Worldwide Developers Conference, 6/5-6/9

·     Bank America Global Tech Conference, 6/6-6/8, in San Francisco, CA

·     Deutsche Bank Global Consumer Conference, 6/6-6/8, in Paris

·     Deutsche Bank Basic Materials, Industrials & Building Products Conference, 6/7-6/8, in New York

·     NAREIT REITweek, 6/6-6/8, in New York

·     Needham 7th Annual Automotive Tech Conference, 6/7 (virtual)

·     RBC Capital Global Energy, Power & Infrastructure Conference, 6/6-6/7, in New York

·     TD Cowen Sustainability Week 2023 (virtual), 6/6-6/9

·     William Blair 43^rd Annual Growth Stock Conference, 6/6-6/8, in Chicago, IL

 

 

Macro	Up/Down	Last
Nymex	0.83	72.57
Brent	0.73	77.02
Gold	-2.10	1,979.40
EUR/USD	0.0021	1.0711
JPY/USD	-0.27	139.36
10-Year Note	-0.015	3.685%

 

 

World News

·     China May Exports fell -7.5% y/y vs -0.4% consensus; Imports fell -4.5% y/y vs -8.0% consensus and the China May Trade Balance $65.8b vs $92b consensus.

·     Turkey’s lira plunged to a record low and is the worst-performing currency against the dollar versus expanded majors, as traders said state lenders had halted dollar sales to defend it – Bloomberg.

 

Sector News Breakdown

Consumer

·     Calavo Growers (CVGO) 2Q adj EPS ($0.01) vs est. $0.18, adj EBITDA $6.9Mm vs est. $9.008Mm on revs $244.7Mm vs est. $265.2Mm; expect earnings to improve in 2H vs 1H, expect avocado volumes in 2H to exceed year ago.

·     Casey’s General (CASY) Q4 EPS $1.49 vs. est. $1.59; Q4 revs $3.33B vs. est. $3.38B; Q4 Inside same-store sales up 6.5%; raises quarterly dividend 13% to 43c per share; has $400M remaining under its existing share repurchase authorization.

·     Couchbase (BASE) Q1 EPS loss (-$0.48) vs. est. loss (-$0.32); Q1 revs $41M vs. est. $39.67M; Q1 subscription revs rose 21% y/y to $38.5M; Q1 Gross margin 85.6% vs. 86.7% y/y; sees Q2 revenue $41.2M-$41.8M vs. consensus $43.31M.

·     Dave & Buster’s (PLAY) Q1 EPS $1.45 vs. est. $1.24; Q1 revs rose 32.4% y/y to $597.3M vs. est. $601.74M; Q1 comparable store sales decreased (-4.1%); announces $200M share repurchase.

·     Limoneira (LMNR) Q2 adj EPS $0.21 vs. est. $0.19; Q2 revs $48.1M vs. est. $48.24M; reiterates lemon volume guidance and lowers avocado volume guidance for fiscal 2023; now expects avocado volumes to be in the range of 3.0M-4M pounds for FY23.

·     StitchFix (SFIX) 3Q EPS ($0.19) vs est. ($0.30) on revs $394.9Mm vs est. $388.94Mm, adj EBITDA $10.1Mm vs est. $0.1617Mm; guides 4Q revs $365-375Mm vs est. $379.4Mm and adj EBITDA $0-10Mm vs est. $8.228Mm.

·     Post Holdings (POST) announces a new $400M share repurchase authorization.

·     Tesla (TSLA) Model 3 vehicles are all now eligible for the full U.S. tax credit under new criteria for battery- sourcing set by the Treasury Department, Bloomberg reported. Previously, only the performance version of the Model 3 was eligible for $7,500 in tax credits.

·     Tesla (TSLA) shares rising pre-mkt, looking to extend its winning streak to 9-consecutive days.

 

Energy, Industrials and Materials

·     The American Petroleum Institute said weekly inventories for Crude fell -1.7m barrels, Cushing +1.5m, Gasoline +2.4m, Distillate +4.5m barrels.

·     AES Corporation (AES) announced the acquisition of the 2 GW Bellefield project, which is currently in late-stage development and is the largest permitted solar-plus-storage project in the United States.

 

Financials

·     New York Mortgage (NYMT) cuts quarterly dividend to 30c per share from 40c per share.

·     Lawmakers are again looking to try to curb Visa (V) and MasterCard (MA) fees, with a new bill introduced as soon as this week that would give merchants the power to process many credit cards over different networks – WSJ.

 

Healthcare

·     Cogent Biosciences (COGT) 12.5M share Spot Secondary priced at $12.00.

 

Technology, Media & Telecom

·     Skillsoft Corp. (SKIL) 1Q EPS ($0.27) vs est. ($0.18) on revs $136Mm vs est. $136.5Mm, adj EBITDA $22Mm vs est. $23.65Mm; guides FY bookings $610-640Mm, revs $555-585Mm vs est. $566.37Mm and adj EBITDA $100-105Mm.

·     Yext Inc. (YEXT) 1Q adj EPS $0.09 vs est. $0.05 on revs $99.5Mm vs est. $98.55Mm, annual recurring revs $398Mm, adj EBITDA $14.4Mm vs est. $10.97Mm; guides 2Q revs $101.5-102.5Mm vs est. $100.12Mm, adj EBITDA $11-12Mm vs est. $10.94Mm and adj EPS $0.06-0.07 vs est. $0.05; sees FY revs $404-407Mm vs est. $403.57Mm, adj EBITDA $49-51Mm vs est. $45.16Mm and adj EPS $0.28-0.29 vs est. $0.22.