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Блог компании DayTraderClub | Америка сегодня. Данные по розничным продажам и инфляции.

Сегодня выходит блок значительных новостей. За час до открытия рынка выходят данные по инфляции, согласно ожиданиям превысившей 2% в годовом измерении. Новый показатель ожидается на уровне 2.1%:
Америка сегодня. Данные по розничным продажам и инфляции.


Наибольшая инфляция продолжает наблюдаться в сфере услуг, товарная инфляция снижается, но эти темпы замедляются:
Америка сегодня. Данные по розничным продажам и инфляции.


Вместе с инфляционными данными выходит показатель розничных продаж, который в годовом выражении ожидается на том же уровне:
Америка сегодня. Данные по розничным продажам и инфляции.


Падение в годовом масштабе происходит из-за слабого прироста в месячных показателях этого года. Данные за январь ожидаются на уровне 0.3%:
Америка сегодня. Данные по розничным продажам и инфляции.


Все новости: 
Америка сегодня. Данные по розничным продажам и инфляции.
Данные: DTC News, Briefing, Interactive, Economics, Public Sources
93 комментария
  T-Mobile US target raised to $69 at RBC Capital Mkts  (61.60)RBC Capital Mkts raises their TMUS tgt to $69 from $67. T-Mobile reported solid 4Q16 results, with top-line and EBITDA ahead of estimates. They believe 2017 guidance is conservative and could well be steadily revised upwards through the year, consistent with recent company history. They expect T-Mobile to continue its current growth trajectory driven by increased footprint and distribution and further network investment. They view management's new three-year FCF CAGR target of 45-48% as conservative.
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  Scorpio Tankers upgraded to Buy from Neutral at Clarkson Platou; $7 tgt  (4.47)
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  Omega Health downgraded to Hold from Buy at SunTrust  (31.28)
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 Overnight Summary — World markets echo momentum seen in Tuesday's run up on Wall St
  • The global equity markets are mixed again this morning, with the S&P Futures under water by a couple points after tapping the 2340 level overnight. The volume that traded above yesterday's highs was light and fairly quick, suggesting the move to the top of the range overnight was likely just stop orders. As such, US futures are currently closer to the bottom of the trading range.
  • In Asia, the Nikkei was nearly able to recover Tuesday's losses with a gain of 1% in the Nikkei today. The index was supported by momentum of the rise in US markets on Tuesday (closing right near all-time highs) as well as strength in the USDJPY following the moderately hawkish tone set by Janet Yellen at her Congressional testimony. The usual suspects (ie exporters) were benefactors from the decline in the yen. Both Panasonic (+3%) and Honda Motor (+1%) were instrumental in pacing the way for the Nikkei's advance.
  • In China, the Shanghai was unable to sustain early gains and closed 0.2% lower by the session's end. Traders seemed uninspired after the news of the PBOC's healthy liquidity injection wore off. Macro news was light across the Mainland on Wednesday, but the New Yuan Loan figure that came out after the Shanghai was closed the previous day, may have weighed on sentiment throughout the day. This is notable considering the lending data representing the second highest on record. When combined with Tuesday's CPI rising at the strongest pace since 2011, investors likely took that as another sign the PBOC is unlikely to make any aggressive moves any time soon.
  • Across the pond, the major bourses are mostly higher this morning. The CAC is the best of the bunch so far this morning, led by strength in the banking sector, after Credit Ag (+2%) posted a solid quarterly result. Meanwhile, Heineken is also helping to support consumer names after it also released a strong earnings report.
  • Crude oil is down over 0.5% this morning, reacting negatively to the release of the weekly API release, which reported a build of 9.941 mln barrels vs. last week's build of 14.23 mln barrels

Market updates

  • S&P Futures vs Fair Value: -1.00 
  • 10 yr Note: 2.4789% 
  • USD/JPY: 114.52 +0.26  
  • EUR/USD: 1.0555 -0.0018
  • Europe: FTSE +0.4% DAX +02% CAC +0.6% 
  • Asia: Hang Seng +1.2% Shanghai -0.2% Nikkei +1.0% 
  • Commodities: Gold (1227.10 +1.70) Silver (17.87 -0.02) crude (52.83 -0.37) 

US Econ Data

  • Jan CPI (8:30am)
  • Jan Retail Sales (8:30am)
  • Feb Empire Manuf ((8:30am)
  • Jan Industrial Prod/Capacity Ut (9:15am)
  • Dec Business Inventories (10am)
  • Crude Inventories (10:30am)
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  Mondelez Int'l, GIS, K, CPB, HSY, SJM, MKC initiated with Hold ratings at Deutsche Bank  (44.99)
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  Kraft Heinz, CAG, PF, LNCE, NOMD, TWNK initiated with Buy ratings at Deutsche Bank  (90.81)
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  Corp Office Props downgrade details — to Neutral at Robert W. Baird given strong share performance; tgt raised to $33  (32.91)Robert W. Baird downgrades OFC to Neutral from Outperform and raises their tgt to $33 from $32 as they believe that the underlying momentum of Defense IT will likely improve under the new Administration and that OFC is well positioned to benefit from the increased activity. In addition, the co's strong balance sheet and improved portfolio--combined with an end to strategic repositioning--should drive FFO/sh 8-10% higher in 2018. However, given a now more modest valuation discount to its peers and strong share price performance since YE15, firm's total return outlook is more modest.
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  QuintilesIMS downgrade details — to Underperform at Robert W. Baird as fundamentals no longer support current valuation; tgt lowered to $74  (82.30)Robert W. Baird downgrades Q to Underperform from Neutral and lowers their tgt to $74 from $80. Firm admits they would take advantage of market inefficiencies and sell all Q shares. They may be early and they might even be wrong, but to them the fundamentals do not support current valuation. In a normal world, reports like Q has been putting up would lead to 52-week lows, not 52-week highs. Q has become less transparent, harder to model, the numbers are of materially lower quality, and the numbers simply aren't good.
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 Asian Markets Close: Nikkei +1.0%, Hang Seng +1.2%, Shanghai -0.2%

Equity indices in the Asia-Pacific region ended the midweek session on a mixed note. Overall, regional markets appeared unperturbed by yesterday's testimony on monetary policy delivered by Federal Reserve Chair Janet Yellen. Economic data out of Australia showed that businesses and consumers are anticipating a rate hike from the Reserve Bank of Australia in the near term.

  • In economic data:
    • Australia's February Westpac Consumer Sentiment 2.3% (last 0.1%). January New Motor Vehicle Sales +0.6% month-over-month (expected 0.2%; last 0.1%)
    • South Korea's January Unemployment Rate 3.6% (expected 3.4%; last 3.5%)
    • Singapore's December Retail Sales -1.9% month-over-month (expected -2.2%; last 0.5%); +0.4% year-over-year (consensus 1.4%; previous 0.7%)

---Equity Markets---

  • Japan's Nikkei added 1.0%. Dentsu, Dai-ichi Life Insurance, MS&AD Insurance Group, Mitsubishi, Panasonic, Sony Financial, Nippon Sheet Glass, Shizuoka Bank, and Mitsubishi Motors climbed between 2.4% and 8.4%. Toshiba fell 8.6% after officially booking a $6.3 billion writedown related to the company's US nuclear unit.
  • Hong Kong's Hang Seng rallied 1.2% to levels not seen since October. Financials had a strong showing with China Construction Bank, Bank of China, ICBC, and Bank of East Asia jumping between 2.5% and 4.9%. Consumer names Belle International and China Mengniu Dairy underperformed, falling close to 1.3% apiece.
  • China's Shanghai Composite shed 0.2%. Huaxin Cement, Jinjian Cereals Industry, Fujian Cement, and Jiangxi Copper posted losses between 4.5% and 5.3%.
  • India's Sensex lost 0.7%. Tata Motors fell 10.3% after reporting a sharp decline in its quarterly profit. Sun Pharma also lagged, falling 4.3%, in reaction to below-consensus results. Tata Steel, Hero MotoCorp, Maruti Suzuki, and Dr Reddy's Labs lost between 0.9% and 2.6%.

---FX---

  • USDJPY +0.2% to 114.53
  • USDCNY +0.1% to 6.8705
  • USDINR +0.1% to 66.900
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  OneMain Holdings upgraded to Outperform at Wedbush; tgt raised to $35  (26.69)Wedbush upgrades OMF to Outperform from Neutral and raises their tgt to $35 from $30. Firm feels the lowered growth expectations and restart of the branch conversion process put out with the release of the Sept. quarter's results were the ideal tonic for what appears to be a quick turnaround. And, while firm is jumping in with only 1 good quarter, reported charge offs were right on the mark, and the unexpected improvement in delinquencies bodes well they believe for trends in net charge offs.
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  Sapiens Int'l acquires privately held StoneRiver for approx. $102 million in cash; expects transaction to be accretive to EPS starting in 3Q17  (13.88)

StoneRiver's product portfolio is comprised of a policy administration suite, rating, underwriting, illustrations, reinsurance, and finance & compliance solutions for all major insurance business lines, across both property and casualty and life and annuities.

  • StoneRiver estimated Non-GAAP full year 2016 revs are $80 mln and the company is profitable.
  • Co's mgmt. expects this transaction to be accretive to earnings starting w/ 3Q17.
  • The transaction is expected to be completed by the end of 1Q17.

Co will host a conference call and webcast February 15 at 12:00 p.m. ET

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  Visa, MA, CSRA, LFGR initiated with Buy ratings at Loop Capital  (86.85)
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  Coupa Software, NIC Inc (EGOV) initiated with Hold ratings at Loop Capital  (25.92)
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  Encana initiated with a Overweight at JP Morgan; tgt $16  (12.86)
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  CAE upgraded to Sector Outperform from Sector Perform at Scotia  (14.54)
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  Convergys downgraded to Hold from Buy at SunTrust  (25.00)
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  Ametek upgraded to Overweight from Neutral at Atlantic Equities; tgt $62  (53.58)
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  Blueprint Medicines initiated with a Overweight at Morgan Stanley  (34.35)
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  Aviragen Therapeutics downgraded to Neutral at H.C. Wainwright — Complete failure of SPIRITUS leaves little visibility to value  (0.67)H.C. Wainwright downgrades AVIR to Neutral from Buy. After market close, on February 13, Aviragen announced that the Phase 2b SPIRITUS trial of its lead drug candidate, vapendavir, missed its primary and several secondary endpoints. In a very confusing result for firm, the outsized placebo effect was so large that not only did it do better than either active drug arm, but it also represents 2.2x the magnitude of the placebo effect observed in the prior RHINO study (0.44), as measured by the similar ACQ-5 scoring tool. Furthermore, firm had expected the placebo response in SPIRITUS to be less than observed in RHINO, not more, given the substantially more severe (so called enriched) patient population of SPIRITUS.
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  Flex among stocks with favorable commentary on Tuesday's Mad Money  (16.27)

Stocks with favorable mention: NUE, ENB, CBG, AQN, AZO, AAP, AMZN, SNA, FLEX, V, TMUS

Stocks with unfavorable mention: NOK

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  European Markets Update: DAX +0.2%, CAC +0.5%, FTSE +0.6%

Major European indices trade in the green, hovering near record highs from January. The Italian government is reportedly in talks with European officials about a precautionary recapitalization of Banca Popolare di Vincenza and Veneto Banca. Elsewhere, Greek Prime Minister Alexis Tsipras reiterated that discussing additional austerity measures for Greece would be destructive.

  • In economic data:
    • Eurozone December trade surplus expanded to EUR28.10 billion from EUR25.90 billion (expected surplus of EUR22.80 billion)
    • UK's December Average Earnings Index + Bonus +2.6% (expected 2.8%; last 2.8%). December Unemployment Rate held at 4.8%, as expected. January Claimant Count Change -42,400 (expected 800; last -20,500)
    • Spain's January CPI -0.5% month-over-month, as expected (last 0.6%); +3.0% year-over-year, as expected (last 1.6%)

---Equity Markets---

  • Germany's DAX is higher by 0.2%. Financials lead with Commerzbank and Deutsche Bank showing respective gains of 2.8% and 2.7%. Bayer, BASF, and Infineon are up between 0.3% and 0.6%. On the downside, Merck, Adidas, and Continental are down between 0.3% and 0.9%.
  • France's CAC trades up 0.5%. Credit Agricole, BNP Paribas, and Societe Generale show gains between 1.7% and 4.4% after Credit Agricole reported better than expected earnings. On the downside, Peugeot has given up 2.7% while Renault is lower by 0.5%.
  • UK's FTSE has added 0.6% with help from financials and select miners. RBS, Barclays, Lloyds Banking, Standard Chartered, Old Mutual, Prudential, and HSBC are up between 1.3% and 1.9% while BHP Billiton and Rio Tinto show respective gains of 2.1% and 0.8%.
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  Toshiba shares down 7% overseas following FY16 results  (2.05)
  • Co reported Q3 FY16 EPS of (JPY 118.07) vs (JPY 113.23) last year; revs -3% YoY to JPY 3.873 trillion.
  • Co sees FY16 EPS of (JPY 92.11) and revs of JPY 5.52 trillion.
  • Co Presentationwhere chip unit business sale discussed
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 Overseas Research Calls

Upgrades

  • Associated British Foods (ASBFY) upgraded to Buy from Hold at Shore Capital

Downgrades

  • Rolls Royce PLC (RYCEY) downgraded to Sell from Hold at S&P Global
  • William Hill PLC (WIMHY) downgraded to Reduce from Hold at HSBC
  • Ladbrokes Coral (LDCOY) downgraded to Reduce from Hold at HSBC

Miscellaneous

  • None of note
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  On The Wires
  • Trillium Therapeutics (TRIL) announced that it will present new data from the Phase 1 trial of its anti-CD47 checkpoint inhibitor TTI-621 at the ASCO-SITC Clinical Immuno-Oncology Symposium on February 24, in Orlando, Florida.
  • Medicines360 and Allergan plc (AGN) announced a partnership with 340B-eligible health centers and other safety net providers in Puerto Rico and Florida, both areas where there is local transmission of the Zika virus, to make available their hormonal contraceptive, LILETTA (levonorgestrel-releasing intrauterine system) 52 mg. LILETTA is an IUS, intrauterine system (otherwise known as an intrauterine device or IUD), that is approved for the prevention of pregnancy for up to three years. Research has shown that pregnant women infected with the Zika virus are at risk of giving birth to infants born with microcephaly — a birth defect caused by the exposure to the Zika virus where a baby's head is smaller than expected when compared to babies of the same sex and age. LILETTA, is available at a lower cost to public health clinics enrolled in the 340B Drug Pricing Program.
  • Amunix Operating announced that it has entered into a research and development collaboration with Genentech, a member of the Roche Group (RHHBY). The agreement will focus on the discovery and development of therapeutics utilizing Amunix's proprietary XTEN technology against multiple targets selected by Genentech.
  • FLIR Systems (FLIR) awarded a $50 mln IDIQ contract to provide marine electronics systems under the U.S. Coast Guard's Scalable Integrated Navigation Systems 2 (SINS-2) program over a five-year period providing the purchaser a right to extend delivery for an additional five years. FLIR will provide electronics systems that will be standard fit on over 2,000 U.S. Coast Guard vessels, ranging from small-class boats through large cutter-class vessels.
  • Novocure (NVCR) announced that the first patient has been enrolled in LUNAR, its phase 3 pivotal trial of Tumor Treating Fields at 150 kHz as a treatment for advanced non-small cell lung cancer after failing platinum-based therapy.
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  Wright Medical Group downgraded to Hold at Needham  (26.62)Needham downgrades WMGI to Hold from Buy as they think that 2017 ests are achievable but rev guidance is likely to require a 2H17 ramp and this could cause an overhang on WMGI shares. They also think that while WMGI's sales force expansion should eventually drive faster rev growth, it could cause short-term disruption. And while firm expects WMGI's adjusted EBITDA margin to improve rapidly and to reach 20% by 2019, this may prompt investors to value WMGI on EV/EBITDA, a measure which they think makes its shares look expensive.
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  Suburban Propane downgrade details — to Hold at Stifel; tgt lowered to $29  (28.74)Stifel downgrades SPH to Hold from Buy and lowers their tgt to $29 from $34. Following a review of Heating Degree Day (HDD) data and EIA's updated Short Term Energy Outlook (STEO), firm downgrades as they see limited catalysts looking beyond the winter heating season. That being said, they continue to model the partnership maintaining the current distribution as they est leverage will continue to remain below 5.0x.
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  Hologic upgraded to Buy at Needham following CYNO deal; tgt $46  (39.03)Needham upgrades HOLX to Buy from Hold and sets target price at $46. Firm's upgrade comes after HOLX announced the acquisition of Cynosure (CYNO) for $1.44B with an all-cash tender offer. CYNO is a leading aesthetics company that competes in a $2B market growing in the double-digits with a range of products used for hair removal, body contouring, skin revitalization, and other cosmetic procedures. HOLX expects CYNO to increase its rev growth and add $0.13-0.15 to its FY18E EPS. HOLX has now effectively swapped a business with declining sales and margins (blood screening) for one with double-digit growth and improving margins (CYNO). With the blood screening EPS «hole» now partially filled and HOLX facing increasingly easy comps over the next three quarters, they upgrade to Buy.
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  Early premarket gappersGapping up: FIG +27.9%, CIDM +15.7%, IOTS +12.7%, IVTY +5.8%, SEDG +4.5%, WIX +4.4%, STNG +4%, CCS +3.9%, HUN +3.5%, SIRI +3.4%, RH +3.4%, SHOP +3.4%, PAH +3.2%, IOSP +3%, A +2.7%, PG +2.5%, ADHD +2.5%, AAL +2.4%, PBPB +2.4%, DB +2.2%, VNOM +2.2%, GILT +2.1%, BG +2.1%, DAL +2%, TWTR +2%, BBVA +2%, LUV +1.9%, DVN +1.7%, GT +1.5%, UAL +1.4%, KRNT +1.4%, ELOS +1.4%, HTZ +1.3%, JBLU +1.2%, NTCT +1.2%, PAAS +1.2%, MON +1.1%, BCS +1.1%, FANG +1%, CS +0.9%, LYG +0.9%, MYL +0.9%, CIM +0.9%, PYPL +0.8%, HSBC +0.8%, BHP +0.8%, HUM +0.7%, HUBS +0.6%, ETR +0.6%, ALKS +0.5%, CRNT +0.5%

Gapping down: FOSL -18.8%, EARS -18.3%, ESNC -16.9%, TRUP -11.7%, NAII -11.4%, PLAB -10.2%, CALX -8.5%, UNXL -7.9%, LC -6.8%, HOLI -5.6%, TECK -5.5%, AIG -4.9%, SBCF -4.3%, GOGL -4.2%, SDRL -3.7%, UAA -3.3%, MASI -3.2%, OMI -3.1%, BP -2.5%, CZR -2.3%, RDS.A -2.2%, ASGN -2.1%, BXMT -1.6%, MRK -1.5%, ESRX -1.5%, SEV -1.4%, QGEN -1.3%, FCX -1.3%, BYD -1.3%, VDSI -1.3%, SHPG -1.2%, MT -1.2%, RPXC -1.2%, AA -1.1%, DE -1%, TSLA -1%, NVO -0.9%, NBIX -0.9%, MFS -0.9%, LXFT -0.7%, DNOW -0.7%
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  American Intl: Color on Qtr  (66.89)
  • RBC Capital notes AIG reported a Q4/16 operating loss of $(2.72), falling far short of firm's $(0.61) estimate and the somewhat sloppy $(0.38) consensus. The biggest component of the shortfall was a significantly larger than forecast reserve addition for the commercial unit, totaling $5.6 billion, far in excess of firm's $2.5 billion forecast. Net/Net: While the accounting noise makes some comparisons difficult, firm is confident the overall results are worse than expected and not just due to a big reserve add.
  • FBR Capital notes AIG reported 4Q16 operating EPS of ($2.72) vs. the FBR ($1.22) and Street ($0.61) estimates. The reserve charge for FY16 of $5.6B gross was much higher than firm's $3.8B forecast, which was high on the Street. Firm was surprised that there was not more upfront reaction to the prospect of a large charge when the reinsurance deal with National Indemnity Company was announced on January 20, 2017. The market will likely need to recalibrate around this and the impact to BV. Adjusted BV per common share, which has been the main BV metric, moved from $61.41 at 3Q16 to $58.57 in 4Q16. But, with the NICO cover in place, attention will turn to the go-forward operating prospects. Maintain Market Perform rating, as it remains cautious around margins, reserves, and credit exposure at AIG.

Shares of AIG are down approx 5% in reaction to bigger than expected reserve build.

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 Overnight Treasury Summary

Treasuries Edge Lower Ahead of Data Deluge

  • U.S. Treasuries are ticking lower this morning after an overnight session light on economic data releases. The U.K.'s employment picture improved more than expected in January although wage growth was a bit sluggish. On the Continent, the eurozone's trade surplus unexpectedly widened in December. Today, Fed Chair Janet Yellen will appear again in Washington, D.C., this time before the House Financial Services Committee. Her prepared statement in front of the Senate Banking Committee on Tuesday sent Treasuries tumbling as she lowered the hurdle for future rate hikes and minimized downside risks to the U.S. economy. What will probably be even more important than Yellen's testimony today is the U.S. consumer price index and retail sales data for January. Industrial production figures will also be released. The S&P 500 is set to open unchanged at 2,337.4 and the U.S. Dollar Index is 0.15% higher at 101.40. WTI crude is off by 0.64% to $52.86/bbl. and gold is adding 0.23% to $1,228.2/troy oz.
  • Yield Check:
    • 2-yr: -1 bp to 1.23%
    • 5-yr: unch at 1.97%
    • 10-yr: +1 bp to 2.48%
    • 30-yr: +1 bp to 3.07%
  • News:
    • In Australia, Westpac Consumer Sentiment rose to 2.3% in February from 0.1% in January
    • Korea's unemployment rate unexpectedly increased to 3.6% in January from 3.5% in December
    • In the U.K., claimants for unemployment fell by 42.4K in January after declining 20.5K in December. Economists had expected little change
      • The Average Earnings index (including bonuses) rose 2.6% y/y in December, missing estimates after 2.8% growth in November
      • The unemployment rate remained at 4.8% in December, as expected
    • The eurozone's trade surplus unexpectedly widened in December to EUR28.1 bln from EUR25.1 bln in November
    • Spain's consumer price index fell 0.5% m/m in January (+3.0% y/y), as expected. The decline reversed most of December's 0.6% increase
      • Spain's harmonized index of consumer prices (HICP) fell 1.0% m/m in January (+2.9% y/y) after a 0.5% gain in December
  • Data out Wednesday:
    • MBA Mortgage Index for the week ending 2/11: Actual -8.0% w/w, Prior 2.3%
    • Average contract 30-year fixed mortgage rate: Actual 4.32%, Prior 4.35%
    • January CPI and Core CPI (08:30 ET)
    • February Empire Manufacturing (08:30 ET)
    • January Retail Sales and Retail Sales ex-auto (08:30 ET)
    • January Industrial Production and Capacity Utilization (09:15 ET)
    • December Business Inventories (10:00 ET)
    • February NAHB Housing Market Index (10:00 ET)
    • Crude Inventories for the week ending 2/11 (10:30 ET)
    • December Net Long-Term TIC Flows (16:00 ET)
  • Fed Speakers:
    • Fed Chair Yellen (FOMC voter) (10:00 ET)
    • Boston Fed President Rosengren (non-FOMC voter) (12:00 ET)
    • Philadelphia Fed President Harker (FOMC voter) (12:45 ET)
    • New York Fed President Dudley (19:15 ET)
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  WAVE Life Sciences initiated with a Buy at H.C. Wainwright; tgt $41  (29.50)H.C. Wainwright initiates WVE with a Buy and price target of $41. Firm notes WVE has developed has an innovative and proprietary synthetic chemistry platform that uses rational design to develop stereopure nucleic acids. The company is able manufacture stereopure nucleic acid therapeutics that precisely targets the underlying cause of rare genetic diseases. The chemistry platforms include antisense, exon-skipping and single-stranded RNAi. The first three product candidates' INDs are planned for 2017 in Huntington's disease (HD) and Duchenne's Muscular Dystrophy (DMD). If successful, Ionis' (IONS) IONIS-HTTRxmay reach the market first, firm believes WAVE may have a safer more effective products. They expect 65% penetration in the US and 55% penetration in the EU for each product that target ~two-thirds of the symptomatic patients which they est is 30K on each continent.
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  Foamix initiated with a Outperform at Credit Suisse; tgt $22  (10.66)
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  MAG Silver downgraded to Outperform from Strong Buy at Raymond James  (16.59)
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  First Majestic Silver downgraded to Underperform from Mkt Perform at Raymond James  (10.41)
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  Verisk Analytics downgraded to Neutral from Positive at Susquehanna  (85.09)
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  Wayfair target raised to $45 at Wedbush — 4Q16 Preview: $1 Billion, Here We Come  (41.20)Wedbush raises their W tgt to $45 from $40. Firm forecasts W to hit $1b in quarterly revenue for the first time in 4Q16, to be reported on February 23 BMO, outpacing guidance and consensus expectations. They also see upside for EBITDA margin, driven mainly by revenue upside. They would not be surprised if 1Q17 guidance comes up a bit short of consensus on rev and EBITDA margin, but believe investors are braced for this conservatism that the company has demonstrated for the last two quarters. This data, combined with guidance to run-rate profitability later this year and a planned break-out near-term of U.S. results as intimated at ICR, should support W shares and leads them to raise tgt. Slowing advertising leverage (particularly in light of new moves by Amazon in Google product listing ads) and declining orders per average customer are focal points to monitor. Firm sees Q4 EPS of ($0.45) vs consensus of ($0.50).
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  On Assignment upgraded to Mkt Outperform from Mkt Perform at Avondale  (45.46)
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  Cabela's target lowered to $51 at Stifel; Hold — CAB 4Q unlikely to shine through clouds of doubt, revised target reflects some probability of alternative scenarios  (46.66)Stifel lowers their CAB tgt to $51 from $65.50. The combination of regulatory hurdles associated with the sale of WFB to Capital One and challenged fundamentals for the merchandise business introduce risk to the acquisition by Bass Pro for the agreed upon price of $65.50 per share. In combination with what is likely to be a disappointing 4Q report on Thursday morning, firm expects CAB shares remain under-pressure. That said, firm continues to believe both Bass Pro and Capital One are committed to consummating a transaction. Firm's revised 12 mos. target of $51 reflects equal probability of 1) the deal closing within 12 mos. at the agreed upon $65.50 per share, 2) the deal closing within 12 months but renegotiated to a value of $55 per share, and 3) unraveling of the deal and regression of CAB shares to 12X multiple on their revised FY17 EPS est of $2.87 ($34.39).
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 &P futures vs fair value: +0.80. Nasdaq futures vs fair value: +1.10.

Investors have hit the pause button on Wednesday morning after pushing the major averages to fresh record highs on Tuesday and ahead of a heap of economic data today. The S&P 500 futures trade one point above fair value.

U.S. Treasuries remain under pressure this morning and are in danger of posting their fifth consecutive loss. The benchmark 10-yr yield is one basis point higher at 2.48%.

Crude oil also trades lower this morning, down 0.6% at $52.88/bbl. The energy component's downtick follows yesterday's American Petroleum Institute report which showed a build of 9.9 million barrels. The Energy Information Administrations's official supply report will cross the wires today at 10:30 ET.

The weekly MBA Mortgage Index, which was released earlier this morning, decreased 3.7% to follow last week's 2.3% uptick.

In addition to the MBA Mortgage Index, Wednesday's economic agenda is jam-packed with January CPI (Briefing.com consensus 0.3%), January Retail Sales (Briefing.com consensus 0.1%), and February Empire Manufacturing (Briefing.com consensus 7.0) at 8:30 ET, January Industrial Production (Briefing.com consensus 0.0%) and Capacity Utilization (Briefing.com consensus 75.5%) at 9:15 ET, December Business Inventories (Briefing.com consensus 0.4%) and February NAHB Housing Market Index (Briefing.com consensus 68) at 10:00 ET, and December Net Long-Term TIC Flows at 16:00 ET.

In U.S. corporate news:

  • PepsiCo (PEP 107.40, +0.48): +0.5% after raising its dividend and reporting better than expected earnings.
  • AIG (AIG 63.85, -3.04): -4.5% after reporting a wider-than-expected fourth quarter loss.
  • Express Scripts (ESRX 68.95, -0.68): -1.0% after missing revenue estimates and issuing downbeat earnings guidance for the first quarter.
  • Fossil (FOSL 18.54, -4.33): -18.9% after reporting worse than expected revenues and issuing disappointing guidance.

Reviewing overnight developments:

  • Equity indices in the Asia-Pacific region ended the midweek session on a mixed note. Japan's Nikkei +1.0%, Hong Kong's Hang Seng +1.2%, China's Shanghai Composite -0.2%, India's Sensex -0.7%.
    • In economic data:
      • Australia's February Westpac Consumer Sentiment 2.3% (last 0.1%). January New Motor Vehicle Sales +0.6% month-over-month (expected 0.2%; last 0.1%)
      • South Korea's January Unemployment Rate 3.6% (expected 3.4%; last 3.5%)
      • Singapore's December Retail Sales -1.9% month-over-month (expected -2.2%; last 0.5%); +0.4% year-over-year (consensus 1.4%; previous 0.7%)
    • News was light on Wednesday:
      • Economic data out of Australia showed that businesses and consumers are anticipating a rate hike from the Reserve Bank of Australia in the near term.
  • Major European indices trade in the green, hovering near record highs from January. Germany's DAX +0.2%, France's CAC +0.5%, UK's FTSE +0.6%.
    • In economic data:
      • Eurozone December trade surplus expanded to EUR28.10 billion from EUR25.90 billion (expected surplus of EUR22.80 billion)
      • UK's December Average Earnings Index + Bonus +2.6% (expected 2.8%; last 2.8%). December Unemployment Rate held at 4.8%, as expected. January Claimant Count Change -42,400 (expected 800; last -20,500)
      • Spain's January CPI -0.5% month-over-month, as expected (last 0.6%); +3.0% year-over-year, as expected (last 1.6%)
    • In news:
      • The Italian government is reportedly in talks with European officials about a precautionary recapitalization of Banca Popolare di Vincenza and Veneto Banca.
      • Greek Prime Minister Alexis Tsipras reiterated that discussing additional austerity measures for Greece would be destructive.
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  TransUnion target raised to $43 at Stifel — Post Call Thoughts: Not much to pick on here folks, FCF should generate interesting opportunities in the next several years  (37.43)Stifel raises their TRU tgt to $43 from $39. There just isn't much to pick on, in firm's view, and continued strong underlying fundamentals remain intact. While all the key metrics in our model are improving, they believe the strong FCF generation that is starting to come through is of particular note. Firm would expect the company to generate $900M-$1B of FCF in the next three years, and after accounting for $300M in share repurchases and $150M of required debt repayments, they expect ample opportunity for incremental value enhancing activities including continued M&A, and potentially additional share repurchases. If mgmt wanted to keep the senior leverage ratio constant to the current level, firm believes there would be over $1.2B-$1.3B of FCF available (after share repurchases) for M&A or additional share repurchases; Buy.
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  Watsco target raised to $175 at Stifel following the Q4 miss, still a solid compounding long term story; Buy  (150.06)Stifel raises their WSO tgt to $175 from $165. Headline miss a tad surprising given strong 4Q results for most HVAC names, with other HVAC products negative. High expectation stock, as reflected in the underperformance today (down ~4% vs. +40 bps for the S&P 500). That said, firm doesn't think under-performance will last for long. Under the hood, decent performance on GM and continued investment and return on technology investments. Waving in more of the Carrier JV is common sense to firm. Given the increased income (net the increased interest expense) as a result of the Carrier JV (they are dialing ~$0.15 benefit for 2017E). Firm takes their 2017E EPS est to $5.85 (from $5.70) and their 2018E EPS remains at $6.60, which could readily have upside due to Trump tax benefits or incremental M&A, for which mgmt was quite bullish on the prospects. They are also introducing 2017 quarterly ests.
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  SolarEdge Technologies: Color on Qtr  (14.45)
  • Needham Research notes SEDG reported a slight 4Q16 (Dec) miss but provided better-than-expected 1Q17 (Mar) revenue guidance. Given the challenging U.S. residential solar market and increased pricing pressure in inverters,firm believes buy-side expectations were low going into print. However, management sounded confident on top-line growth in 2017 by share gains in the U.S. and international expansion. Despite fears on significant ASP erosion in 2017, SEDG has done a good job staying ahead on cost reduction, which firm believes will drive potential gross margin expansion. Reiterates Buy and maintain $22 tgt.
  • FBR Capital notes SEDG delivered C4Q16 results that highlight challenges in its core U.S. residential solar market. Revenue can mostly be attributed to softness in the U.S. residential market, with muted growth in 2017. However, SEDG indicated strong growth in its U.S. commercial business. C1Q17 revenue guidance of $110M--$120M with 31%--33% gross margin indicates SEDG still prioritizes profitable growth over market share. Management still believes it is gaining market share in every geography in which it operates and expects continued gains. Firm remains on the sidelines until it sees evidence of a pickup in the U.S. market or significant international expansion.

Shares of SEDG are up approx 4% in reaction to earnings. 

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  InterXion upgraded to Buy from Neutral at Guggenheim; tgt raised to $43 from $38  (38.12)
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  Brady upgraded to Buy from Neutral at Northcoast; tgt $45  (37.30)
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  Level 3 disclosed that it and CenturyLink (CTL) received a request for additional information from the Department of Justice in connection with their pending merger  (57.87)The effect of the second request is to extend the waiting period imposed by the HSR Act until 30 days after Level 3 and CenturyLink have substantially complied with the request, unless that period is extended voluntarily by the parties or terminated sooner by the DOJ. Level 3 and CenturyLink intend to cooperate fully with the DOJ, are confident that regulatory approval will be obtained and expect to close the transaction in the third quarter of 2017.
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 Gapping up

Gapping up
In reaction to strong earnings/guidance
:

  • CIDM +15.7%, IOTS +12.7%, WIX +7.5%, SODA +7.2%, IVTY +5.8%, SEDG +5.5%, ANGI +4.6%, ELOS +4.3%, CCS +3.9%, ALKS +3.5%
  • ADI +3.5%, OZM +3.3%, IOSP +3%, A +2.7%, FANG +2.4%, PBPB +2.4%, HUN +2.3%, VNOM +2.2%, BG +1.9%, SHOP +1.7%, ADHD +1.7%, DVN +1.4%
  • KRNT +1.4%, WGBS +1.4%, HUM +0.7%, PAAS +0.7%, ETR +0.6%

M&A news:

  • FIG +28.2% (SoftBank confirms plans to acquire Fortress Investment Group for $3.3 bln)

Select EU financial related names showing strength:

  • DB +1.6%, CS +1.1%, BCS +0.9%, LYG +0.9%, HSBC +0.7%

Select Airline related names showing strength:

  • LUV +2.8%, UAL +2.6%, AAL +2.5%, DAL +2%, JBLU +1.4%, SAVE +1%

Other news:

  • PAH +3.2% (Elliott Management discloses new position)
  • PG +2.5% (Nelson Peltz's Trian takes stake)
  • SIRI +2.3% (new Berkshire Hathaway stake)
  • TWTR +2.2% (CEO Jack Dorsey disclosed purchase of nearly 426K shares worth $7 mln)
  • ARDX +2.2% (reports its Phase 3 trial evaluating tenapanor as a treatment for hyperphosphatemia in patients with end-stage renal disease who are on dialysis met its primary endpoint and was generally well-tolerated)
  • NTCT +1.2% (ValueAct new position),
  • FOLD +1.1% (reports new positive data analyses for the oral small molecule pharmacological chaperone migalastat HCl for Fabry disease)
  • CRM +1% (new Corvex stake)
  • MON +1% (new Berkshire Hathaway stake)
  • HTZ +0.9% (Icahn increases stake)

Analyst comments:

  • RH +3% (upgraded to Overweight from Sector Weight at KeyBanc Capital Mkts)
  • OLED +2.2% (initiated with a Positive at Susquehanna; tgt $100)
  • BBVA +2% (upgraded to Overweight from Neutral at JP Morgan)
  • PH +1.5% (upgraded to Buy from Neutral at BofA/Merrill)
  • V +0.6% (initiated with Buy ratings at Loop Capital)
  • NDSN +0.5% (upgraded to Overweight from Sector Weight at KeyBanc Capital Mkts)
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 European Summary

Greek Bonds Fall Again as Spanish Inflation Hits 4-Year High

  • Eurozone sovereign bonds are seeing mixed results this morning after Spanish inflation was reported to have hit a four-year high in January (3.0% y/y). The European Central Bank is unlikely to be impressed with this development, however, as its policymakers are still not seeing wage growth in the single currency bloc. In the U.K., wage growth unexpectedly slowed in December and this is pushing the pound sterling lower against the dollar (GBP/USD: -0.29% to 1.2419) and lowering gilt yields. Greek debt is under pressure again today as Pierre Moscovici, the EU economics chief, meets with Greek PM Alexis Tsipras and Greek Finance Minister Euclid Tsakalotos in Athens. The Eurogroup will meet next Monday for the last big discussion about Greece before the upcoming elections in the Netherlands, France, and Germany. Greece will need a fresh cash injection by July in order to make an EUR7 bln repayment but the IMF and Greece's European creditors are in disagreement over Greece's government budget targets before more cash is dispensed. Specifically, the IMF is asking for deeper cuts to pensions and higher taxes, without which Greece's debt burden would become explosive, according to the IMF
  • Central Banks:
    • Sweden's Riksbank's executive board kept its main policy rate at -0.50% and extended its mandate to permit «quick intervention on the foreign exchange market»
      • Krona appreciation threatens the revival of inflation that the Riksbank is trying to engineer with negative interest rates
  • European Economic Data:
    • In the U.K., claimants for unemployment fell by 42.4K in January after declining 20.5K in December. Economists had expected little change
      • The Average Earnings index (including bonuses) rose 2.6% y/y in December, missing estimates after 2.8% growth in November
      • The unemployment rate remained at 4.8% in December, as expected
    • The eurozone's trade surplus unexpectedly widened in December to EUR28.1 bln from EUR25.1 bln in November
      • The widening was driven by 6% growth in exports versus just 4% growth in imports
      • The trade surplus for FY2016 was EUR274 bln, up almost 15% from FY2015
    • Spain's consumer price index fell 0.5% m/m in January (+3.0% y/y), as expected. The decline reversed most of December's 0.6% increase
      • Spain's harmonized index of consumer prices (HICP) fell 1.0% m/m in January (+2.9% y/y) after a 0.5% gain in December
    • Greece's HICP rose to 1.5% y/y in January from 0.3% in December
  • Yield Check:
    • France, 10-yr OAT: -2 bps to 1.03%
    • Germany, 10-yr bund: unch at 0.37% 
    • Greece, 10-yr note: +20 bps to 7.64%
    • Italy, 10-yr BTP: -3 bps to 2.20%
    • Portugal, 10-yr PGB: unch at 4.01%
    • Spain, 10-yr ODE: -2 bps to 1.65%
    • U.K., 10-yr gilt: -2 bps to 1.28%
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 On The Wires
  • Novocure (NVCR) announced that the first patient has been enrolled in LUNAR, its phase 3 pivotal trial of Tumor Treating Fields at 150 kHz as a treatment for advanced non-small cell lung cancer after failing platinum-based therapy.
  • Entest BioMedical Inc.'s (ENTB) wholly owned subsidiary, Zander Therapeutics Inc., announced today publication by the United States Patent and Trademark Office of a Utility Patent application entitled «Canine Autologous Immunotherapy using Dendritic Cell Induced Cancer Killing Immunocytes». This patent application, which has a priority date of July 2015 and is assigned to Zander Therapeutics, covers the generation of a new type of cell from dog blood which possesses ability to kill tumor cells.  «Currently Zander Therapeutics is pursuing a highly targeted strategy of therapeutically modifying the immune system in cats, dogs and horses using small molecule modulators of NR2F6 activity. In this particular case, the current patent publication extends the intellectual property walls that Zander is establishing by covering specific means of generating immune system cells that can be modified by the small molecules in development,» said Harry Lander, Ph.D., President and Chief Scientific Officer of Zander Therapeutics.
  • CB&I (CBI) announced it has been awarded a contract by Dongguan Grand Resource Science & Technology Co. Ltd. for the license and engineering design of a grassroots propane dehydrogenation unit to be built in Dongguan City, Guangdong Province, China. The unit will use CB&I's CATOFIN catalytic dehydrogenation technology and Clariant's tailor-made CATOFIN catalyst to produce 600,000 metric tons per year of propylene. This unit has been optimized to reduce equipment piece-count and lower propane consumption, resulting in low investment and operating costs.
  • ICU Medical (ICUI) announced results of a new multi-hospital study that shows dramatic improvements in potentially catastrophic dosing errors and drug library compliance when its Plum infusion pumps and Hospira MedNet safety software are integrated with hospitals' electronic medical records. The study showed a 52 percent decrease in the rate of PCDE's and an average of 156 overall average percent increase in compliance with a participating hospital's drug libraries after smart pump-EMR integration, which was consistent across hospitals and sustained after integration. One hospital saw a decrease in the PCDE rate of as much as 73 percent. There was also a large and statistically significant reduction in the variability in the severity of individual PCDEs. The study was performed at three US community hospitals ranging from 50 to 350 beds.
  • Roche (RHHBY) announced that it has signed an exclusive partnership agreement with Medtronic plc (MDT). Under the terms of the agreement, Roche will develop a dedicated Bluetooth Low Energy enabled blood glucose monitoring meter that will communicate with Medtronic's future BLE enabled insulin pump systems. The new meter will be based on Roche's innovative Accu-Chek Guide platform and will be marketed under the name Accu-Chek Guide Link. The exclusive agreement covers all markets where future BLE enabled pumps will be commercialized.
  • X-Chem, Inc. announced that it has expanded its collaboration with Janssen Biotech (JNJ), to discover new drug leads for the treatment of inflammatory disease. The multi-target expansion builds on the parties' existing discovery and license partnership, entered into in December 2014, and was facilitated by Johnson & Johnson Innovation. This latest agreement will apply X-Chem's DEX platform to the identification of novel modulators for challenging disease targets, following the licensing of multiple series of X-Chem-discovered small molecules by Janssen in 2016. Under the terms of the agreement, X-Chem receives an upfront payment and research funding, and is eligible to receive additional payments and royalties based on the achievement of clinical, regulatory and commercial milestones.
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 Gapping down

Gapping down
In reaction to disappointing earnings/guidance
:

  • FOSL -18.9%, ESNC -16.9%, TRUP -11.7%, PLAB -11%, LC -9.5%, CALX -8.5%, NAII -7.8%, HOLI -5.6%, AIG -5%, CRNT -3.9%, MASI -3.2%, OMI -3.1%
  • CZR -2.3%, ASGN -2.1%, CBB -1.6%, SEV -1.4%, BYD -1.3%, VDSI -1.3%, RPXC -1.2%, NBIX -0.9%, MFS -0.9%, LXFT -0.7%, DNOW -0.7%, TECK -0.6%

Select oil/gas related names showing early weakness:

  • SDRL -3.2%, BP -2.3%, RDS.A -2.3%, SLB -0.5%

Other news:

  • EARS -18.3% ( to sell common shares and warrants to purchase its common shares in an underwritten public offering; updates on patent case again Otonomy)
  • UNXL -10.7% (may be related to yesterday's announcement of public offering)
  • SBCF -4.7% (commences common stock offering)
  • CSX -2.1% (calls special meeting in light of Mantle Ridge and Hunter Harrison requests; CSX has concerns with proposals)
  • STNG -1.8% (announced that Scorpio Services Holding Limited, a related party affiliate, purchased an aggregate of 650,000 common shares of the Company in the open market at an average price of $4.40 per share)
  • MRK -1.4% (announces EPOCH study of Verubecestat for the treatment of people with mild to moderate Alzheimer's disease to stop for lack of efficacy )
  • DE -1.4% (Berkshire Hathaway decreased stake)

Analyst comments:

  • UAA -1.5% (downgraded to Negative from Neutral at Susquehanna)
  • OHI -0.9% (downgraded to Hold from Buy at SunTrust )
  • HOLX -0.5% (downgraded to Neutral from Buy at BofA/Merrill)
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 Futures Digesting Data; Retail Sales, CPI and Empire Manufacturing All Above Expectations… S&P futures vs fair value: -1.30. Nasdaq futures vs fair value: -0.60.

The S&P 500 futures trade one point below fair value.

Just in, total CPI rose 0.6% (Briefing.com consensus +0.3%) in January while core CPI, which excludes food and energy, increased 0.3% (Briefing.com consensus +0.2%). On a year-over-year basis, total CPI is up 2.5% and core CPI has increased 2.3%.

Separately, January retail sales increased 0.4%, which compares to the Briefing.com consensus of 0.1%. The prior month's reading was revised higher to 1.0% from 0.6%. Excluding autos, retail sales rose 0.8% while the consensus expected an uptick of 0.4%. The prior month's reading was revised higher to 0.4% from 0.2%.

The Empire Manufacturing Survey for February rose to 18.7 from the prior month's reading of 6.5. The Briefing.com consensus estimate was pegged at 7.0.

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 Gapping up/down: SODA +7%, ANGI +5%, A +3%, and BG +2% after earnings, FIG +28% after M&A news; FOSL -19%, PLAB -11%, LC -10%, AIG -5% and OMI -3% after earnings, UAA -1.5% after dg

Gapping up
In reaction to strong earnings/guidance
:

  • CIDM +15.7%, IOTS +12.7%, WIX +7.5%, SODA +7.2%, IVTY +5.8%, SEDG +5.5%, ANGI +4.6%, ELOS +4.3%, CCS +3.9%, ALKS +3.5%
  • ADI +3.5%, OZM +3.3%, IOSP +3%, A +2.7%, FANG +2.4%, PBPB +2.4%, HUN +2.3%, VNOM +2.2%, BG +1.9%, SHOP +1.7%, ADHD +1.7%, DVN +1.4%
  • KRNT +1.4%, WGBS +1.4%, HUM +0.7%, PAAS +0.7%, ETR +0.6%

M&A news:

  • FIG +28.2% (SoftBank confirms plans to acquire Fortress Investment Group for $3.3 bln)

Select EU financial related names showing strength:

  • DB +1.6%, CS +1.1%, BCS +0.9%, LYG +0.9%, HSBC +0.7%

Select Airline related names showing strength:

  • LUV +2.8%, UAL +2.6%, AAL +2.5%, DAL +2%, JBLU +1.4%, SAVE +1%

Other news:

  • PAH +3.2% (Elliott Management discloses new position)
  • PG +2.5% (Nelson Peltz's Trian takes stake)
  • SIRI +2.3% (new Berkshire Hathaway stake)
  • TWTR +2.2% (CEO Jack Dorsey disclosed purchase of nearly 426K shares worth $7 mln)
  • ARDX +2.2% (reports its Phase 3 trial evaluating tenapanor as a treatment for hyperphosphatemia in patients with end-stage renal disease who are on dialysis met its primary endpoint and was generally well-tolerated)
  • NTCT +1.2% (ValueAct new position),
  • FOLD +1.1% (reports new positive data analyses for the oral small molecule pharmacological chaperone migalastat HCl for Fabry disease)
  • CRM +1% (new Corvex stake)
  • MON +1% (new Berkshire Hathaway stake)
  • HTZ +0.9% (Icahn increases stake)

Analyst comments:

  • RH +3% (upgraded to Overweight from Sector Weight at KeyBanc Capital Mkts)
  • OLED +2.2% (initiated with a Positive at Susquehanna; tgt $100)
  • BBVA +2% (upgraded to Overweight from Neutral at JP Morgan)
  • PH +1.5% (upgraded to Buy from Neutral at BofA/Merrill)
  • V +0.6% (initiated with Buy ratings at Loop Capital)
  • NDSN +0.5% (upgraded to Overweight from Sector Weight at KeyBanc Capital Mkts)

Gapping down
In reaction to disappointing earnings/guidance
:

  • FOSL -18.9%, ESNC -16.9%, TRUP -11.7%, PLAB -11%, LC -9.5%, CALX -8.5%, NAII -7.8%, HOLI -5.6%, AIG -5%, CRNT -3.9%, MASI -3.2%, OMI -3.1%
  • CZR -2.3%, ASGN -2.1%, CBB -1.6%, SEV -1.4%, BYD -1.3%, VDSI -1.3%, RPXC -1.2%, NBIX -0.9%, MFS -0.9%, LXFT -0.7%, DNOW -0.7%, TECK -0.6%

Select oil/gas related names showing early weakness:

  • SDRL -3.2%, BP -2.3%, RDS.A -2.3%, SLB -0.5%

Other news:

  • EARS -18.3% ( to sell common shares and warrants to purchase its common shares in an underwritten public offering; updates on patent case again Otonomy)
  • UNXL -10.7% (may be related to yesterday's announcement of public offering)
  • SBCF -4.7% (commences common stock offering)
  • CSX -2.1% (calls special meeting in light of Mantle Ridge and Hunter Harrison requests; CSX has concerns with proposals)
  • STNG -1.8% (announced that Scorpio Services Holding Limited, a related party affiliate, purchased an aggregate of 650,000 common shares of the Company in the open market at an average price of $4.40 per share)
  • MRK -1.4% (announces EPOCH study of Verubecestat for the treatment of people with mild to moderate Alzheimer's disease to stop for lack of efficacy )
  • DE -1.4% (Berkshire Hathaway decreased stake)

Analyst comments:

  • UAA -1.5% (downgraded to Negative from Neutral at Susquehanna)
  • OHI -0.9% (downgraded to Hold from Buy at SunTrust )
  • HOLX -0.5% (downgraded to Neutral from Buy at BofA/Merrill)
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  Techtarget target raised to $10 from $9 at Lake Street followng the Q4 beat  (8.84)
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  AMN Healthcare assumed with a Buy at Lake Street; tgt $50  (38.90)Lake Street assumes coverage of AMN with a Buy and sets target price at $50 as they believe AMN is uniquely positioned to capitalize on a rapidly growing market opportunity through the existing scale of their core business, as well as through the growth of their Workforce Solutions businesses. While investors remain focused on the large market and significant tailwinds driving demand for temporary healthcare workers, firm believes they are not fully considering AMN's transformation from a traditional staffing provider to a healthcare workforce solutions company. Firm thinks AMN's innovative offerings reduce the Company's risks related to an economic slowdown. As AMN continues to show strong rev growth and margin expansion, firm expects investors to value the company at 9.8X firm's 2017 EBITDA forecast, or $50 per share.
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  Cross Country assumed with a Buy at Lake Street; tgt $17  (14.94)Lake Street assumes coverage of CCRN with a Buy and sets target price at $17. Firm notes the healthcare staffing market has the most compelling supply/demand dynamics in the staffing industry and mgmt at CCRN has aggressively positioned the company to be a beneficiary of these long-term secular trends. With the largest national network of local branch offices in the industry, CCRN is ideally positioned to take advantage of the expected strong growth in the Per Diem (local) and Allied (outpatient/ambulatory) segments of the market. They believe the company has numerous opportunities for market share gains both organically and through acquisitions. Furthermore, they believe current street expectations could prove conservative as mgmt pursues its growth strategy. Firm's $17 price target reflects their belief that investors will value CCRN with a 10.5x multiple on their FY17 EV/EBITDA est.
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  S&P futures vs fair value: -2.00. Nasdaq futures vs fair value: -4.90.

The S&P 500 futures trade two points below fair value.

Equity indices in the Asia-Pacific region ended the midweek session on a mixed note. Overall, regional markets appeared unperturbed by yesterday's testimony on monetary policy delivered by Federal Reserve Chair Janet Yellen. Economic data out of Australia showed that businesses and consumers are anticipating a rate hike from the Reserve Bank of Australia in the near term.

  • In economic data:
    • Australia's February Westpac Consumer Sentiment 2.3% (last 0.1%). January New Motor Vehicle Sales +0.6% month-over-month (expected 0.2%; last 0.1%)
    • South Korea's January Unemployment Rate 3.6% (expected 3.4%; last 3.5%)
    • Singapore's December Retail Sales -1.9% month-over-month (expected -2.2%; last 0.5%); +0.4% year-over-year (consensus 1.4%; previous 0.7%)

---Equity Markets---

  • Japan's Nikkei added 1.0%. Dentsu, Dai-ichi Life Insurance, MS&AD Insurance Group, Mitsubishi, Panasonic, Sony Financial, Nippon Sheet Glass, Shizuoka Bank, and Mitsubishi Motors climbed between 2.4% and 8.4%. Toshiba fell 8.6% after officially booking a $6.3 billion writedown related to the company's US nuclear unit.
  • Hong Kong's Hang Seng rallied 1.2% to levels not seen since October. Financials had a strong showing with China Construction Bank, Bank of China, ICBC, and Bank of East Asia jumping between 2.5% and 4.9%. Consumer names Belle International and China Mengniu Dairy underperformed, falling close to 1.3% apiece.
  • China's Shanghai Composite shed 0.2%. Huaxin Cement, Jinjian Cereals Industry, Fujian Cement, and Jiangxi Copper posted losses between 4.5% and 5.3%.
  • India's Sensex lost 0.7%. Tata Motors fell 10.3% after reporting a sharp decline in its quarterly profit. Sun Pharma also lagged, falling 4.3%, in reaction to below-consensus results. Tata Steel, Hero MotoCorp, Maruti Suzuki, and Dr Reddy's Labs lost between 0.9% and 2.6%.

Major European indices trade in the green, hovering near record highs from January. The Italian government is reportedly in talks with European officials about a precautionary recapitalization of Banca Popolare di Vincenza and Veneto Banca. Elsewhere, Greek Prime Minister Alexis Tsipras reiterated that discussing additional austerity measures for Greece would be destructive.

  • In economic data:
    • Eurozone December trade surplus expanded to EUR28.10 billion from EUR25.90 billion (expected surplus of EUR22.80 billion)
    • UK's December Average Earnings Index + Bonus +2.6% (expected 2.8%; last 2.8%). December Unemployment Rate held at 4.8%, as expected. January Claimant Count Change -42,400 (expected 800; last -20,500)
    • Spain's January CPI -0.5% month-over-month, as expected (last 0.6%); +3.0% year-over-year, as expected (last 1.6%)

---Equity Markets---

  • Germany's DAX is higher by 0.1%. Financials lead with Commerzbank and Deutsche Bank showing respective gains of 2.2% and 2.4%. Bayer, BASF, and Infineon are up between 0.3% and 0.5%. On the downside, Merck, Adidas, and Continental are down between 0.2% and 1.4%.
  • France's CAC trades up 0.6%. Credit Agricole, BNP Paribas, and Societe Generale show gains between 2.0% and 5.3% after Credit Agricole reported better than expected earnings. On the downside, Peugeot has given up 2.5% while Renault is lower by 0.8%.
  • UK's FTSE has added 0.5% with help from financials and select miners. RBS, Barclays, Lloyds Banking, Standard Chartered, Old Mutual, Prudential, and HSBC are up between 0.9% and 2.3% while BHP Billiton and Rio Tinto show respective gains of 1.9% and 0.2%.
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 Filings, Offerings and Pricings

Filings:

  • Amgen (AMGN) files mixed securities shelf offering
  • Atwood Oceanics (ATW) files mixed securities shelf offering
  • Walt Disney (DIS) files for 1,357,657 common stock offering by a selling security holder; proposed max offering price of $109.40/share
  • Neurocrine Biosci (NBIX) files for mixed securities shelf offering; size not disclosed
  • Viking Therapeutics (VKTX) files for 9,965,956 common stock offering by holders

Offerings:

  • OSI Systems (OSIS) intends to offer $225 million principal amount of Convertible Senior Notes due 2022 in a private offering
  • Seacoast Banking (SBCF) commences common stock offering for undisclosed size; will consist of shares to be sold by the co and shares to be sold by one of its stockholders, CapGen Capital Group III LP

Pricings:

  • Celsion (CLSN 0.33) prices common stock offering at $0.23 per/share with expected total gross proceeds of approximately $5.0 million
  • Auris Medical (EARS 1.15) prices 10 mln common stock offering at $1.00/unit
  • Sigma Labs (SGLB ) announces the pricing of a firm commitment underwritten public offering of 1,410,000 units at $4.13/unit
  • Trinity Place (TPHS 7.44) enters into an agreement for a non-brokered private placement of its common stock for the sale of an aggregate of 3,585,000 shares of common stock at a purchase price of $7.50 per share
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  Rayonier downgraded to Hold from Buy at Vertical Research; $29 tgt  (28.38)
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  Calix Networks downgraded to Market Perform from Outperform at Northland Capital; tgt lowered to $7 from $9  (7.65)
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  Generac target raised to $40 yesterday at Canaccord Genuity; Hold  (39.80)Canaccord Genuity raises their GNRC tgt to $40 from $38 yesterday, following earnings noting, «We continue to like the secular adoption story for this category leader, with dealer count at post-Sandy peaks and retail placement for portables at all-time highs. FCF remains compelling (record $223M in ‘16), supporting M&A, growth capex, buyback and debt paydown activity, in our view. Still, challenges remain, with mobile equipment still impacted by oil & gas/BREXIT challenges (some signs of bottoming this quarter). Net, we wait for improved risk/reward to become more constructive.»
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  Hub Group initiated with a Buy at Seaport Global Securities; tgt $60  (50.00)
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  CMS issues proposed rule to increase patients’ health insurance choices for 2018
  • CMS issued a proposed rule for 2018, which proposes new reforms that are critical to stabilizing the individual and small group health insurance markets to help protect patients. This proposed rule would make changes to special enrollment periods, the annual open enrollment period, guaranteed availability, network adequacy rules, essential community providers, and actuarial value requirements; and announces upcoming changes to the qualified health plan certification timeline. (HUM, AET, MOH, ANTM, HCA, WCG, CI, THC, CYH, CCM, UHS, LPNT).
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  On The Wires
  • On Track Innovations (OTIV) announced it has received purchase orders through its channel partners to supply thousands of advanced self-checkout payment systems, incorporating the Company's cashless payment systems, to leading U.S. based kiosk and food chain operators. The systems will be shipped throughout 2017.
  • Danaher's (DHR) Cepheid confirmed that it has received clearance from the FDA to market Xpert Xpress Flu and Xpert Xpress Flu/RSV. Both tests deliver reference-quality molecular results in as little as twenty minutes. The tests are Cepheid's first Xpress branded products — all of which are expected to deliver results in 30 minutes or less.
  • Abbott Labs (ABT) announced results of real-world use data showing that people who scan more frequently using Abbott's FreeStyle Libre system spend less time in hypoglycemia (low blood sugar) or hyperglycemia (high blood sugar) while having improved average glucose levels.
  • Medovex (MDVX) announced that the Company successfully completed its final CE Mark audit meeting. The review of the Company's DenerveX System was conducted February 7-9, 2017 by LNE/GMED, a French-based Notified Body firm. This audit is required to demonstrate compliance with the regulatory requirements to achieve CE Mark approval.
  • Spotlight Innovation (STLT) announced that it has entered into a second license agreement with the Florida State University Research Foundation for the development and commercialization of additional anti-Zika virus compounds. As with the initial license agreement, this agreement grants to Spotlight Innovation exclusive, worldwide rights to develop and commercialize certain compounds for the treatment of viral infections, including Zika virus infection. 
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  Flowers Foods upgraded to Buy at Gabelli & Co  (18.99)Gabelli & Co upgrades FLO to Buy from Hold. Given the reduced risk from mis-classification lawsuits and the DOL review, the savings objectives introduced from Project Centennial, which met our expectations, and attractive valuation, firm is changing their recommendation to a Buy. They think that over time rational consumer and industry behavior will return, as lower prices fail to stimulate volume demand, but rather refocus on improving mix by shifting sales to branded products and introducing more on-trend, healthier products to drive growth across the category. NT catalysts include additional restructuring actions (manufacturing network and/or overhead savings), while the company would also benefit from US tax reform. Shares trade at ~10.7x 2017E EBITDA and 20.2x P/E and yield a current return of 3.4%.
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  SCANA Corp defended at Gabelli & Co., buy the weakness  (66.86)Gabelli notes SCG shares declined $3.17, or 4.5%, on concerns related to the financial health of Westinghouse (W) and parent Toshiba (TOSBF) as well as speculation that W may not be committed to completing nuclear facilities under construction, including VC Summer Nuclear Units 2&3. Toshiba delayed filing quarterly financials due to concerns around the company's accounting controls, specifically as it relates to W. The preliminary $6.3 billion charge related to SCG and SO nuclear projects, wipes out the company's common equity. SCG's nuclear development investment is largely protected under SC's Baseload Review Act (BLRA). In order for SCE&G investment to be imprudent, opposing parties would need to prove negligence on SCE&G. The BLRA provides for recovery even under the highly unlikely scenario of abandonment. They believe that SCG or Fluor would assume the contractor role in as worst case scenario. Buy on Weakness, $75 PMV.
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  Cutera: Remains an attractive takeout target — Gabelli & Co.  (21.00)Gabelli notes given recent consolidation in the laser dermatology market with Allergan's (AGN) announced acquisition of Zeltiq (ZLTQ) (at 6x 2017 rev) and Hologic's (HOLX) announced acquisition of Cynosure (CYNO) (at 3x 2017 rev) in the past two days, CUTR is one of the few remaining publicly traded laser dermatology cos. CUTR trades at less than 2x. They maintain Buy based on their 2017 PMV of $27 per share, as CUTR is growing sales faster than the market and believe CUTR is an attractive acquisition candidate.
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  Fossil: Color on Quarter  (22.87)
  • Wells Fargo downgraded to Underperform from Market Perform.
  • Cowen cuts tgt to $15.
  • Telsey Advisory Group lowers their FOSL tgt to $23 from $27. The wearables offering has seen an uptick, particularly at the Kors and Fossil brands. In addition, management sees the ability to recapture margin through improved volume pricing, mid-single digit revenue growth, and driving organizational efficiencies. However, the costs of investment in the wearables roll out remain heavy, at a time when the headwinds of the slowing traditional watch market, a strong dollar, and increasing interest expense are weighing on profitability. In addition, the jewelry and leathers businesses have remained slower as management focuses its efforts on connected technologies. They therefore still see earnings visibility as challenging, and remain cautious on the shares of FOSL.
  • Mizuho cut tgt to $17 from $19 following a disappointing FY17 guide that reflects the business model transition. While FOSL ramped up the wearables business to 5.5% of FY16 sales on 100+ wearable SKUs across 8 brands, the strategy to give up margins to drive cost efficiencies could end up backfiring on the LT margin profile for the total business. Additionally, they were disappointed the FY17 guide already reflects 40% of the New World Fossil profit improvement, demonstrating limited upside to EPS from cost cuts going forward. Given multiple headwinds and lack of sales/margin clarity, they maintain their negative stance.
  • Note we initially reported GAAP EPS guidance for Q1 and FY17 last night but we have since edited that comment, it was below consensus either way but should have read: guided Q1 adj. EPS of ($0.25)-(0.10) vs. $0.11 Capital IQ Consensus; revs down 9.5-13% to ~$574-597 mln vs. $659.18 mln Capital IQ Consensus. Sees FY17 adj. EPS of $1.00-1.70 vs. $1.91 Capital IQ Consensus; revs flat to down 6.5% to ~$2.84-3.04 bln vs. $3.06 bln Capital IQ Consensus.
  • FOSL down 19% at 8 year low premarket.
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  S&P futures vs fair value: -3.30. Nasdaq futures vs fair value: -6.40.

The stock market is poised for a lower open on Wednesday morning following a heavy dose of economic data. The S&P 500 futures trade three points below fair value.

Just released, January Industrial Production decreased 0.3% (Briefing.com consensus 0.0%) while Capacity Utilization declined to 75.3% (Briefing.com consensus 75.5%) from a revised reading of 75.6% (from 75.5%) in December.

In addition to Industrial Production and Capacity Utilization, a number of economic reports were released earlier this morning, including January CPI, January Retail Sales, February Empire Manufacturing, and the MBA Mortgage Index.

Total CPI rose 0.6% (Briefing.com consensus +0.3%) in January while core CPI, which excludes food and energy, increased 0.3% (Briefing.com consensus +0.2%). On a year-over-year basis, total CPI is up 2.5% and core CPI has increased 2.3%.

January retail sales increased 0.4%, which compares to the Briefing.com consensus of 0.1%. The prior month's reading was revised higher to 1.0% from 0.6%. Excluding autos, retail sales rose 0.8% while the consensus expected an uptick of 0.4%. The prior month's reading was revised higher to 0.4% from 0.2%.

The Empire Manufacturing Survey for February rose to 18.7 from the prior month's reading of 6.5. The Briefing.com consensus estimate was pegged at 7.0.

The weekly MBA Mortgage Index decreased 3.7% to follow last week's 2.3% uptick.

Treasuries fell to lows in reaction to the data. The 10-yr yield is up four basis points at 2.51% while the five year yield has spiked ten basis points to 2.01% in the wake of hotter than expected inflation figures.

Investors will also receive December Business Inventories (Briefing.com consensus 0.4%) and February NAHB Housing Market Index (Briefing.com consensus 68) at 10:00 ET and December Net Long-Term TIC Flows at 16:00 ET.

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  Hewlett Packard Enterprise upgraded to Positive from Mixed at OTR Global  (24.14)
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  Tower Intl downgraded to Neutral from Buy at Citigroup  (26.85)
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 On The Wires
  • SkinnyPop Popcorn, anchor brand to Amplify Snack Brands, Inc. (BETR) and a pioneer in the better-for-you, ready-to-eat popcorn category, is extending its brand beliefs of simple, transparent ingredients and great taste to new categories. New SkinnyPop Popcorn Cakes, Popcorn Mini Cakes and Microwave Popcorn are rolling out nationwide this month, giving consumers new ways to enjoy their snack-time favorites.
  • Pitney Bowes (PBI) announced that global payments solutions provider TSYS has selected the Pitney Bowes IntelliJet 20 Printing System to expand its high-quality color transactional printing capabilities. The new agreement expands a 30-year partnership between the two companies. Financial details not disclosed. 
  • Hill International (HIL) announced that it has received four contracts to provide construction engineering and inspection services on various projects for the Florida Department of Transportation. The four contracts have a combined estimated value to Hill of approximately $3.3 million.
  • Xplore Technologies (XPLR) announced that one of the nation's largest telecommunications service providers has placed an order for XSLATE B10 Fully Rugged Tablet PCs and accessories to support its growing field-based workforce in various regions across the United States. This brings the total value of this multi-year, multi-million dollar project to more than $20 million.
  • PREIT (PEI) signs Burlington (BURL) as lead tenant to replace Sears (SHLD) at Magnolia Mall At Magnolia Mall. In addition to Burlington, the Company is in advanced discussions with two additional retailers for spaces that will be created adjacent to Burlington, diversifying the tenant roster and strengthening the asset's market dominance. PREIT anticipates sales and traffic generated from these additions will substantially outpace what is currently being delivered. For the three stores PREIT previously announced recapturing from Sears, the Company expects to generate returns of 7 — 9 % and will share details of projected capital spending in conjunction with its upcoming earnings release.
  • Rite Aid (RAD) announced today that naloxone, a medication that can be used to reverse the effects of an opioid overdose, is now available at more than 630 pharmacies in Georgia, Louisiana, Tennessee, Utah, Virginia and West Virginia without a prescription, subject to state regulations. Previously, naloxone, which can be administered by injection or nasal spray, was only available with a physician's prescription.
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  Hearing Argo Group was downgraded to Sell from Neutral earlier at Compass Point  (67.00 -0.50)
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  Hearing Commercial Metals was upgraded earlier to Neutral from Sell at Clarkson Platou  (22.39 +0.19)
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 Opening Market Summary: Averages Open Wednesday Mixed

The major averages opened Wednesday's session mixed with the Dow (+0.1%) holding a modest gain while the S&P 500 (-0.1%) hovers below its flat line.

Nine of eleven sectors trade in the red with real estate (-1.0%) and utilities (-0.9%) leading the retreat. On the bright side, the two spaces to buck the bearish trend are the top-weighted financial (+0.2%) and technology (+0.1%) sectors.

Treasuries show losses following this morning's heavy dose of economic data. The 5-yr yield has spiked nine basis points to 2.00% while the benchmark 10-yr yield is up four basis points at 2.51%.

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  American Intl — - Earnings Mover sinks -8% this morning towards its 200-day exponential moving average near $60/61 area  (61.59 -5.30)The 200-day simple moving average lies just below near $59.
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 Hearing Rosenbaltt out cautious on fiber optics space  (10.61 -0.26)FNSR -2.69% FN -2.23% LITE -2.08% OCLR -2.30% ACIA -2.07% AAOI -1.15% INFN -0.65%
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  Sector Summary: Technology (XLK -0.02%) trading slightly lower today, mostly in-line with the broader market

The tech sector — XLK — trades mostly in-line with the broader market. Semiconductors, meanwhile, display relative strength as the SOX index trades +0.26%. Within the SOX index, CY (+1.59%) outperforms, while INTC (-0.50%) lags. Among other major indices, the SPY is trading 0.01% higher, while the QQQ +0.05% and the NASDAQ -0.16% trade opposite on the session. Among tech bellwethers, QCOM (+0.79%) is showing relative strength, while SAP (-0.82%) lags.

Notable gainers following earnings:

  • GRPN (+16.2%) reported better than expected Q4 EPS and revs, WIX (+13.5%) reported better than expected Q4 EPS and revs; guided Q1 and FY17 revs ahead of market expectations, A (+2.3%), ADI (+0.8%)

Notable laggards following earnings:

  • LXFT (-3.6%) reported better than expected Q3 EPS and in-line revs, SHOP (-0.6%)

Gainers on news:

  • ADI (+3.2%) co increased its quarterly dividend to $0.45/share from $0.42/share.
  • TWTR (+1.9%) co CEO Jack Dorsey disclosed purchase of nearly 426K shares worth $7 mln (transaction dates 2/13-2/14).
  • ARW (+0.9%): Analog Devices (ADI) selected ARW as strategic global distribution channel partner.

Laggards on news:

  • COYN (-24.2%) co commenced a private placement of 1.958 mln common shares and warrants; combined purchase price for one registered share of common stock and one warrant is $0.57.
  • PYPL (-0.7%) co to acquire TIO Networks for $233 mln, affirms outlook.
  • LVLT (-0.6%) co disclosed that it and CenturyLink (CTL) received a request for additional information from the Department of Justice in connection with their pending merger.
  • T (-0.4%): Communications Workers of America notified AT&T that former DIRECTV tech support employees in seven states voted to ratify an agreement.

Among notable analyst upgrades:

  • INXN (+1.9%) upgraded to Buy from Neutral at Guggenheim
  • IPGP (+3.2%) to Buy from Neutral at Dougherty

Among notable analyst downgrades:

  • CALX (-16.6%) downgraded to Market Perform from Outperform at Northland Capital
  • CVG (-2.8%) to Hold from Buy at SunTrust
  • HOLI (-1.6%) to Neutral from Buy at Citigroup

Scheduled to report earnings after the bell:

  • AMAT, CSLT, CSCO, ELNK, EQIX, GDDY, NTAP, NTES, QTWO, QUIK, SSNC, SPWR, SNPS, TIVO, TRIP

Scheduled to report earnings tomorrow morning:

  • BCOR, EIGI, EPAM, HIMX, NICE, SYNT, YNDX
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  Hearing GasLog was upgraded to Buy from Neutral at Citigroup  (16.10 -0.10)
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  Procter & Gamble trades +3% to a fresh 52-week high above 90.33  (90.65 +2.79)
  • Price gets a boost up to nearly a fresh 2-year high over $90 after reports of Nelson Peltz's Trian taking a stake in company.
  • Note the all-time high is marked by the late-2014 peak of 93.89.
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  Hearing HollySys was upgraded to Buy from Hold at Deutsche Bank  (17.22 -0.52)
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  Brazil ADRs seeing continued strength — iShares Brazil ETF (EWX +1.2%) at new multi-year highs
  • Brazil ADRs: GOL +7.8% (announced sale and leaseback agreement for five Boeing 737 MAX 8 Aircraft with AWAS), CIG +5.2%, SID +3.2%, FBR +2.8%, UGP +2.7%, ELP +2.4%, ITUB +2.1%, SBS +2.1%, BBD +1.9%, GGB +1.9%, CBD +1.8%, BSBR +1.5%, TSU +1.4%, GFA +1.2%, BRFS +1%, PBR +0.8%
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 Economic Summary: CPI above expectations; Retail Sales above estimates; Housing Starts out tomorrow at 8:30 ET

Economic Data Summary:

  • Weekly MBA Mortgage Applications -3.7% vs Briefing.com consensus of; Last Week was 2.3%
  • January CPI 0.6% vs Briefing.com consensus of 0.3%; December was 0.3%
  • January Core CPI 0.3% vs Briefing.com consensus of 0.2%; December was 0.2%
    • The January increase was the largest seasonally adjusted all items increase since February 2013. A sharp rise in the gasoline index accounted for nearly half the increase, and advances in the indexes for shelter, apparel, and new vehicles also were major contributors.
  • January Retail Sales 0.4% vs Briefing.com consensus of 0.1%; December was revised to 1.0% from 0.6%
  • January Retail Sales Ex-Auto 0.8% vs Briefing.com consensus of 0.4%; December was revised to 0.4% from 0.2%
  • February Empire Manufacturing 18.7 vs Briefing.com consensus of 7.0; January was 6.5
  • January Industrial Production -0.3% vs Briefing.com consensus of 0.0%; December was revised to 0.6% from 0.8%
  • January Capacity Utilization 75.3% vs Briefing.com consensus of 75.5%; December was revised to 75.6% from 75.5%
    • Industrial production decreased 0.3 percent in January following a 0.6 percent increase in December. In January, manufacturing output moved up 0.2 percent, and mining output jumped 2.8 percent. The index for utilities fell 5.7 percent, largely because unseasonably warm weather reduced the demand for heating.
  • December Business Inventories +0.4% vs Briefing.com consensus of 0.4%; November was 0.7%
  • February NAHB Housing Market Index 65 vs Briefing.com consensus of 68; January was 67

Upcoming Economic Data:

  • December Net Long Term TIC Flows due out Wednesday at 16:00 (Briefing.com consensus of; November was $30.8 bln)
  • January Housing Starts due out Thursday at 8:30 (Briefing.com consensus of 1.22 M; December was 1.226 M )
  • January Building Permits due out Thursday at 8:30 (Briefing.com consensus of 1.23 M; December was 1.210 M )
  • Weekly Initial Claims due out Thursday at 8:30 (Briefing.com consensus of 245K; Last Week was 234K)
  • Weekly Continuing Claims due out Thursday at 8:30 (Briefing.com consensus of; Last Week was 2.078 M )
  • February Philadelphia Fed due out Thursday at 8:30 (Briefing.com consensus of 17.5; January was 23.6)

Upcoming Fed/Treasury Events:

  • Janet Yellen will testify to the Senate today at 10:00 ET

Other International Events of Interest

  • Eurozone December trade surplus expanded to EUR28.10 billion from EUR25.90 billion (expected surplus of EUR22.80 billion)
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  Novan triggers circuit breaker halt as shares ramp 38%  (6.61 +1.82)
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 Early Options Activity

Taking an early look at the options market, we found the following names that may be worth watching throughout the day for further indication of investor expectations given their options volume and implied volatility movement.

Stocks seeing volatility buying (bullish call buying/bearish put buying):

Calls:

  • DXCM Feb 85 calls are seeing interest with 1690 contracts trading vs. open int of 470, pushing implied vol up around 11 points to ~88% — Paulson and Company increased position in DXCM. Co is confirmed to report earnings February 28 after the close (co provided Q4 guidance last month).

Puts:

  • Utilities SPDR (XLU) Weekly Mar24 48.5 puts are seeing interest with 24.0K contracts trading vs. open int of 24.0K, pushing implied vol up around 1 points to ~15% — nearly all the volume occurred in one 24K transaction.

Stocks seeing volatility selling:

  • GRPN, HUN, PEP, DNOW implied vol is lower following earnings/guidance

Sentiment: The CBOE Put/Call ratio is currently: 1.03… VIX: (11.63, +0.89, +8.3%).
This Week is options expiration — Friday, February 17th is the last day to trade February equity options.
*Please use the Talk to Us link at the top of the page to provide feedback on this comment as well as the OPTNX comments.

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  EIA Petroleum Inventory Data

The EIA reports that for the week ending Feb 10:

  • Crude oil inventories had a build of +9.5 mln barrels (consensus called for a build of about +3.513 mln barrels).
  • Gasoline inventories had a build of +2.8 mln barrels (consensus called for a draw of -0.752 mln barrels).
  • Distillate inventories had a draw of -0.7 mln barrels.
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 Summary of Weekly Petroleum Data for the Week Ending Feb 10, 2017

Production: U.S. crude oil refinery inputs avgd about 15.5 mln barrels per day during the week ending February 10, 2017, 435,000 barrels per day less than the previous week's avg. Refineries operated at 85.4% of their operable capacity last week. Gasoline production decreased last week, averaging about 9.0 mln barrels per day. Distillate fuel production decreased last week, averaging over 4.5 mln barrels per day.

Imports: U.S. crude oil imports avgd 8.5 mln barrels per day last week, down by 881,000 barrels per day from the previous week. Over the last four weeks, crude oil imports avgd 8.5 mln barrels per day, 9.9% above the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week avgd 604,000 barrels per day. Distillate fuel imports avgd 216,000 barrels per day last week.

Inventory: U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) increased by 9.5 mln barrels from the previous week. At 518.1 mln barrels, U.S. crude oil inventories are above the upper limit of the avg range for this time of year. Total motor gasoline inventories increased by 2.8 mln barrels last week, and are above the upper limit of the avg range. Both finished gasoline inventories and blending components inventories increased last week. Distillate fuel inventories decreased by 0.7 mln barrels last week but are above the upper limit of the avg range for this time of year. Propane/propylene inventories fell 2.6 mln barrels last week but are in the middle of the avg range. Total commercial petroleum inventories increased by 11.1 mln barrels last week.

Demand: Total products supplied over the last four-week period avgd about 19.4 mln barrels per day, down by 2.0% from the same period last year. Over the last four weeks, motor gasoline product supplied avgd over 8.4 mln barrels per day, down by 5.3% from the same period last year. Distillate fuel product supplied avgd 3.8 mln barrels per day over the last four weeks, up by 7.4% from the same period last year. Jet fuel product supplied is down 3.3% compared to the same four-week period last year.

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  Galena Biopharma: Sabby Management discloses 7.04% passive stake  (0.75 -0.04)
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  Synergy Pharma provides corporate update ahead of presentation at the Leerink Partners 6th Annual Global Healthcare Conference   (6.32 +0.02)
  • Update on milestones
    • Trulance in IBS-C — IBS-C sNDA filing expected this quarter
    • DOLCANATIDE in OIC — Potential lifecycle growth opportunity for Trulance
    • DOLCANATIDE in UC — Demonstrated POC
  • Update on Trulance (Chronic Idiopathic Constipation) launch
    • Established 'robust' supply chain process, trade and sample stock ready for launch this quarter, launching with 30-day blister pack
    • Finalized pricing strategy — launching at WAC price of $353.48
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  Gevo: Sabby Management discloses 9.99% passive stake  (1.38 -0.21)
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  President Trump at meeting with retail execs repeats need to cut regulations in the retail industry; says tax plan will be ready 'in the not to distant future'  (44.18 +0.23)
  • President Trump did not mention border tax in public comments. A border adjustment tax is generally considered negative for the retail industry.  Note: Tax reform must be done through a process of budget reconciliation to avoid a potential Democratic filibuster. This will allow tax reform to be pushed through with 51 votes. The border adjustment tax is key because tax reform through budget reconciliation cannot increase deficit. 
  • Related tickers of cos attending meeting:  TGT, BBY, GPS, AZO, WBA, JCP, TSCO
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 Notable movers of interest: AIG -9.1% on bigger than expected reserve build, Q4 operating results below expectations

The following are some of today's most notable movers of interest, categorized by market capitalization (large cap over $10 billion and mid cap between $2-10 billion) and ranked by % change (all stocks over 100K average daily volume).

Large Cap Gainers

  • BBVA (6.83 +2.94%): Upgraded to Overweight from Neutral at JP Morgan.
  • SIRI (4.88 +2.85%): Shares rise on news that Berkshire Hathaway has taken a stake.
  • UAL (75.44 +2.31%): Airlines rise after Berkshire Hathaway increases stakes in United Continental (UAL), Delta (DAL), and American Airlines (AAL); initiates new position in Southwest (LUV).

Large Cap Losers

  • AIG (60.82 -9.07%): Shares drop after bigger than expected reserve build; Q4 operating results below expecations.
  • TECK (23.94 -4.58%): Shares fall despite Q4 EPS and revenue beats.
  • VRSK (83.58 -1.77%): downgraded to Neutral from Positive at Susquehanna.

Mid Cap Gainers

  • FIG (7.98 +28.42%): SoftBank confirms plans to acquire Fortress Investment Group for $3.3 bln.
  • GRPN (4.47 +18.28%): Shares rise after Q4 EPS and revenue beats; sees higher gross profit, EBITDA in 2017.
  • WIX (60.85 +14.92%): Reports Q4 EPS and revenue beats; guides Q1 and FY17 revenues above consensus.

Mid Cap Losers

  • INT (38.86 -14.34%): Shares fall on Q4 EPS miss.
  • LC (6.06 -8.18%): Reports Q1 revenue guidance below consensus.
  • PAAS (19.5 -6.47%): Shares fall after Q4 revenue miss.
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  Groupon (+21%) at 3+ month high after beating Q4 estimates — call notes  (4.52 +0.74)
  • Saw some softness around election — distracted consumers, can see it in Google trends. It was an aberration: December recovered nicely. No comment on January.
  • Share repurchases doubled Q/Q to 12.4 mln shares; views stock as attractive investment, will remain opportunistic.
  • Sees EBITDA growth in Q1 with growth accelerating through the year.
  • Mgmt aiming to increase order frequency by enhancing customer experience.
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  Morning Commodities: Crude now on track to extend yesterday's gain despite EIA reporting inventory builds above Consensus for both crude & gasoline stocks; natural gas futures rally on headlines of an early morning pipeline explosion in Texas
  • Crude oil initially declined to the midpoint of earlier post-API session lows following EIA data which showed crude & gas inventory builds well above Consensus, then reversed direction & broke out to fresh session highs in a volatile pit trading session post-EIA
    • Mar 2017 crude oil futures were  up about $0.20 (+0.4%) around the $53.45/barrel level
    • Baker Hughes rig count data will be released Friday at 1 pm ET.
    • EIA highlights:
      • Crude oil inventories had a build of +9.5 mln barrels (consensus called for a build of about +3.513 mln barrels).
      • Gasoline inventories had a build of +2.8 mln barrels (consensus called for a draw of -0.752 mln barrels).
      • Distillate inventories had a draw of -0.7 mln barrels.
    • Other factors affecting oil prices to consider:
      • The dollar index was near a 3-week high earlier in the session & is not too far from a 14-year high hit late last year.
      • US shale oil production is expected to increase by 80k bpd in Mar 2017, the largest increase in the last 5 months.
      • Libya and Nigeria's crude oil production rose by 10k bpd and 100k bpd respectively in Jan 2017, compared to last month.
      • Iran's crude oil production rose by 50k bpd to 3.8 MMbpd in Jan 2017, compared to last month.
      • Reminder: The EIA noted in their monthly oil market report they expect US crude oil production to rise to a 48-year high in 2018.
  • Natural gas futures rallied to session highs & remained on track to test the $3.00/MMBtu resistance zone on headlines of an early morning pipeline explosion in Texas
    • Mar 2017 natural gas futures were up about $0.05 (+1.6%) around the $2.95/MMBtu level
    • EIA natural gas storage data will be released tomorrow at 10:30 am ET.
  • In precious metals, silver retreated from yesterday's 3-month high on continued strength in the dollar index
    • April 2017 gold futures were nearly flat around the $1225.60/oz level
    • Mar 2017 silver futures were down about $0.02 (-0.1%) around the $17.88/oz level
  • The dollar index was +0.1% around the 101.30 level
    • Commodities, as measured by the Bloomberg Commodity Index, were +0.2% around the 88.78 level
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 Sector Summary: S&P Consumer Discretionary Index +0.2%, in-line with the broader marketThe consumer discretionary group is in-line with the broader market. The retail group is in the green with the Retail HOLDRS Trust (RTH) +0.5% and the SPDR S&P Retail ETF (XRT) +0.2%.

Notable earnings/guidance

  • Trading higher following earnings/guidanceGRPN +20.4%, PBPB +7%, RH +4%, WYN +2.6%, HEINY +2.4%, HLT +1%
  • Trading lower following earnings/guidance: FOSL -17.4%, HNNMY -2.1%
  • Near unchanged mark following earnings/guidance: ANGI
In the news:
  • On the economic front: Retail sales for January increased 0.4% (Briefing.com consensus +0.1%) on top of an upwardly revised 1.0% increase (from +0.6%) for December. Excluding autos, retail sales increased 0.8% (Briefing.com consensus +0.4%) on top of an upwardly revised 0.4% increase (from +0.2%) for December.
  • President Trump at meeting with retail execs - repeated need to cut regulations in the retail industry; said tax plan will be ready 'in the not to distant future' (attending meeting: TGT, BBY, GPS, AZO, WBA, JCP, TSCO)
  • LeadersHLF 2.9% (closes a new $1.45 bln senior secured credit facility, which consists of a $150 mln revolving credit facility maturing 2022 and a $1.3 bln term loan maturing 2023), LOW 1.5% (new Glenview position), COTY +1.3% (Chief Legal Officer bought 40,500 shares at $18.48-18.51 worth ~ $800K), PH 2.5% (upgraded to Buy from Neutral at BofA/Merrill), UAA 0.3% (positive Ron Baron mention; separately downgraded to Negative from Neutral at Susquehanna; tgt lowered to $14 from $24)
  • LaggardsMOV -6.1%, COH -0.1%, KORS -0.1% (lower following FOSL results)

Looking ahead:

  • On the earnings front: CBS, CHH, DENN, KHC, MAR, TRIP report after the close; AVP, BBW, DF, GNC, H, STRA, TIME, WEN report tomorrow before the open. 
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