Early Look

Thursday, May 16, 2024

Another day, another record for major averages, with U.S. futures pointing to modest gains after surging on Wednesday behind tamer inflation and weaker retail sales. The Dow Jones Industrial Average, Nasdaq Composite, and S&P 500 all closed at record highs following softer consumer price (CPI) inflation data and weaker April retail sales data, easing investor fears of a more hawkish Fed in the near term and hopes for interest rate cuts as soon as September to boost the economy. The S&P 500 recorded its 23rd all-time high this year and is now up 29% since October 2023. The index is now up over 11.2% in 2024 even as a total of four interest rate cuts have been priced-out since January. The “SPY” also recorded its 10^th straight day of gains, a rare fete. A few stock movers overnight given 13F quarterly filings released, with shares of Chubb (CB) rising after quarterly filing showed Warren Buffet’s Berkshire Hathaway has taken a stake of 25.9M shares, or about a $6.7 billion-dollar position. Dow component Cisco (CSCO) shares up early on results and guidance last night while in the industrials sector, machinery giant Deere (DE) declines after lowering its yearly outlook. In Asian markets, The Nikkei Index jumped 534 points to 38,920, the Shanghai Index gained 2 points to 3,122, and the Hang Seng Index climbed 302 points to 19,376. In Europe, the German DAX is down -38 points to 18,831, while the FTSE 100 fell -23 points to 8,422. The dollar reverses losses, Bitcoin priced edged higher after big gains Wednesday, holding above $66,000. After two days of euphoria in the “meme” and high short interest stock names, seeing a big reversal to the downside the last 2-days for likes of AMC, GME, etc.

• The Dow Jones Industrial Average rose 349.89 points, or 0.88%, to 39,908.00.
• The Nasdaq Composite surged 231.21 points, or 1.40%, to 16,742.39.
• The Russell 2000 Index advanced 23.77 points, or 1.14% to 2,109.46.

• 8:30 AM ET                  Continuing Claims…est. 1.785M
• 8:30 AM ET                  Housing Starts M/M for April…est. 1.42M (prior 1.321M)
• 8:30 AM ET                  Building Permits M/M for April…est. 1.485M (prior 1.467M)
• 8:30 AM ET                  Import/Export Prices M/M for April…est. +0.3% and est. +0.4%
• 8:30 AM ET                  Philly Fed Survey for May…est. 8.0 (prior 15.5)
• 9:15 AM ET                  Industrial Production M/M for April…est. +0.1%
• 9:15 AM ET                  Capacity Utilization for April…est. 78.4%
• 10:30 AM ET                Weekly EIA Natural Gas Inventory Data
• 10:30 AM ET                Fed’s Harker Speaks on Higher Education, Healthcare
• 12:00 PM ET                Fed’s Mester Gives Remarks on Economic Outlook
• 3:50 PM ET                   Fed’s Bostic Speaks in Moderated Chat on Economy

• Earnings After the Close: AMAT CPRT DOCS DXC FLO TTWO

• Needham 19th Annual Technology, Media & Consumer Conference, 5/14-5/16 in New York
• RBC Capital Canadian Industrials Conference, 5/14-5/16, in Toronto
• Seaport Growth Discovery Conference (virtual), 5/16-5/17
• Wedbush Disruptive Transportation Event, 5/16 (virtual)
• China Retail Sales Y/Y for April

• The bull-bear spread in the American Association of Individual Investors (AAII) weekly survey was 17.6 vs 17 last week. Bulls rise to 40.9% from 40.8%, Neutrals rise to 35.9% from 35.4%, Bears fall to 23.3% from 23.8%.

• Hawkins Inc. (HWKN) Q4 EPS $0.66 vs est. $0.68, adj EBITDA $30.987Mm vs est. $29.17Mm on sales $223.02Mm vs est. $217.49Mm.
• SilverBow Resources (SBOW) shares rise after Bloomberg reports Crescent Energy (CRGY) is in advanced talks to buy SBOW, citing people familiar with the matter, valuing the company at $2.1B. SBOW’s largest shareholder Kimmeridge Energy had also made a similar bid earlier this year but later withdrew the offer https://tinyurl.com/3rvu8jx4
• U.S. Silica (SLCA) announces price increases on industrial and specialty products; said price increases will range up to 20% depending on product and grade and go into effect for shipments beginning July 1, 2024.
• Werner Enterprises (WERN) approves up to 5M share buyback.

• Chubb Ltd. (CB) shares rose after hours after quarterly filing showed Warren Buffet’s Berkshire Hathaway has taken a stake of 25.9M shares, or about a $6.7 billion-dollar position.
• Robinhood Markets (HOOD) said funded customers at end of April were 24.0M; Assets Under Custody (AUC) at end of April were $123.3B, down 5% from March but up 59% y/y and net deposits were $4.9B in April vs. $1.4B y/y; Crypto daily average revenue trades 400,000 vs. 200,000 y/y and equity daily average revenue trades 1.8M, +29% y/y.

• Celcuity (CELC) Q1 adj EPS ($0.59) vs est. ($0.71); sees $177.7Mm cash, cash equivalents and short-term investment providing a runway into the first half 2026.
• Eyenovia (EYEN) Q1 EPS ($0.23) vs est. ($0.17), total op exp approx $10.3Mm; updates on its myopia phase III program and its two FDA approved commercial products, MydCombi and clobetasol.

• Cisco Systems (CSCO) Q3 adj EPS $0.88 vs est. $0.82 on revs $12.7B vs est. $12.531B, adj op mgn 34.2%; guides Q4 revs $13.4-13.6B vs est. $13.228B and adj EPS $0.84-0.86 vs est. $0.85; forecasts FY revs $53.6B-$53.8B, above prior view of $51.5B-$52.5B and vs. est. $53.63B.
• JD.com (JD) Q1 net revenue rose 7% y/y to 260 billion yuan ($36.02B) vs. est. of 257.72 billion yuan; reports net income attributable to shareholders of 7.13 billion yuan in Q1, up nearly 14% from 6.26 billion yuan a year earlier.
• Netflix (NFLX) shares jumped late Wednesday after announced at its VIP Upfront that it now has 40 million ad tier subscribers, and 40% of new members choose ads: still a small percentage of 270M subs but it’s growing.
• Warren Buffet’s Berkshire Hathaway Inc. showed in quarterly filing it cut its share stake in Paramount Global (PARA) by 88.1% to 7.5M Class B shares and said it dissolves stake in HP Inc. (HPQ).
• Palo Alto Networks Inc (PANW) and IBM (IBM) announced a broad-reaching partnership to deliver AI-powered security outcomes for customers. As part of this expanded partnership, Palo Alto Networks has agreed to acquire IBM’s QRadar SaaS assets, including QRadar intellectual property rights, subject to customary closing conditions.
• Spire Global (SPIR) Q1 adj EPS ($0.53) vs est. ($0.68) on revs $25.688Mm vs est. $27.96Mm; sees Q2 revs $29-35Mm vs est. $36.12Mm, adj EPS ($0.31)-($0.15) vs est. ($0.34); sees FY revs $122-132Mm vs est. $141.76Mm, adj EPS ($1.11)-($0.70) vs est. ($1.50).