Америка сегодня. Экономические индикаторы и число буровых установок.

Full results from the trial will be presented at an upcoming scientific forum.

ArQule to host investor conference call on February 17, 2017 at 8:30 A.M. ET

Misc

• Kate Spade (KATE 19.67) target raised to $25 from $21 at Mizuho. Firm notes KATE unexpectedly reported 4Q results with BTE GM and SG&A offsetting NA sales weakness. Importantly, KATE announced it is reviewing strategic alternatives, confirming recent rumors. As KATE moved its 4Q report up by one week, they wonder if a deal may be imminent. With better than feared 4Q results that may improve sentiment in the handbag category, a brand in the early stages of growth, and cash position of $479mm, they believe KATE is an attractive target, especially in a potential strategic transaction.
• WebMD Health (WBMD 51.51) target raised to $55 from $52 at Mizuho. Firm believes the stock would have traded off ~10-15% on its poor 2017 guide, had the company not announced that it is exploring strategic alternatives. The company did this before in 2011, and it amounted to nothing; they can't be sure that this time will be different. WebMD's losing visitors, its revenue growth is slowing materially, and EBITDA margins could contract next year. Yet it has a strong brand, it is a leader in its category, generates FCF, and has strong relationships with Pharma advertisers.
• Endeavtheir Silver (EXK 4.64) initiated with a Buy at Noble Financial; tgt $5.50. Firm notes Silver production represents approximately 2/3 of production. The shares of Endeavtheir move quickly when silver prices change. The shares of EXK almost doubled last summer when sliver prices rose on news of the Brexit vote. They state EXK has three producing mines, three in the development stage and several at the exploratory stage. They believe having mines in different stages gives the company the flexibility to accelerate production should prices rise but still provide cash flow should prices fall.
• ESSA Pharma (EPIX 2.35) initiated with a Buy at Noble Financial; tgt $9. Firm notes ESSA Pharma's intellectual property portfolio covers composition of matter and methods of use. It has 17 filed patent families filed covering various EPI structural motifs, with prosecution ongoing for 14 at present. They value ESSA Pharma based on a risk-adjusted net present value (rNPV) of its pipeline. The company is valued at $9/per share over the next year. The main investment driver is EPI-506 for the castrate resistant prostate cancer (CRPC) program in Phase 1/2 trials. The Phase 1 program is projected to report topline results in 1Q 2017 and a Phase 2 trial based on dose from Phase 1 trial is expected to be initiated in 1Q17
• Celanese (CE 88.86) initiated with a Outperform at Robert W. Baird; tgt $105. Firm notes given consistent execution and several crown jewels in the portfolio (led by Advanced Engineered Materials), they believe that Celanese is on a highly probabilistic path towards valuation multiple expansion by the end of the decade—underlying their initiation with an Outperform rating.
• Alexion Pharma (ALXN 130.39) target lowered to $177 from $187 at RBC Capital Mkts. Firm notes some concerns about Alexion's near-term direction were probably alleviated today: 2017 isn't expected to be the bad year many feared. However, they see Alexion's future as heavily leveraged on one molecule and remain concerned about the lack of data disclosure: while two new Phase IIIs were just announced, they haven't yet seen any data from PNH/aHUS patients treated with 3000-3600mg of q8w 1210. They have updated their model and have removed SBC-103 from their revenue model. We've also removed ALXN1007 for APS and GI-GvHD from their PAT revenue model, since it's no longer being mentioned in ALXN's slides
• Marriott (MAR 89.44) target raised to $90 from $73 at Telsey Advisory Group. Firm notes while it is clearly a positive that the RevPAR cycle appears to be headed for «extra innings», perhaps the larger positive for MAR is the opportunity to integrate and capitalize on the integration of HOT. The business appears to be poised to generate several billions of free cash including asset sales, which should be returned to shareholders. Their positive bias remains although the shares are pricing in much of this opportunity at present levels and they recommend investors take an opportunistic approach.

For 1Q17, co expects load factors in the range of 80%, with passenger yields in the range of R$24 cents. In January, GOL had load factors of 83% and strong forward bookings for February and March.

• For the first quarter, co expects non-fuel CASK in the range of R$14.5 cents. 
• Co expects the increase in jet fuel prices will increase its fuel costs per ASK by 7.5% in 1Q17.

FY 17 is based on GOL's capacity plan and the expected demand for its passenger transportation services, driven by the weak Brazilian economic environment.

• For 2017, co expects to reduce capacity by 0-2%.
• Passenger yields are expected to increase 6%, primarily due to an increase in average fare, partially offset by an increase in stage length, and RASK is expected to increase in the range of 7%.
• Full-year non-fuel CASK is expected to be in the R$14 cent (R$) range, representing a stable level versus 2016.
• Fuel costs per ASK are expected to increase ~18% in the year, due to increases in oil prices.
• Co expects net revs ± r$10
• Raises operating margin guidance to 6-8% from 5-7%

Equity indices in the Asia-Pacific region ended the week on a mostly lower note. The cautious sentiment in regional stock markets was also reflected by the foreign exchange market, where the yen (113.00) has climbed 0.2% against the dollar after showing a modest loss last evening. In South Korea, Samsung's vice chairman was arrested as part of a bribery case.

• In economic data:
  • Japan's February Reuters Tankan Index 20 (last 18)
  • Singapore's Q4 GDP +12.3% quarter-over-quarter (expected 12.6%; last -0.4%); +2.9% year-over-year (consensus 2.5%; last 1.2%)
  • New Zealand's Q4 Retail Sales +0.8% quarter-over-quarter (expected 1.0%; last 0.8%) and Core Retail Sales +0.6% quarter-over-quarter (last 0.2%). January Business NZ PMI 51.6 (last 54.2)

---Equity Markets---

• Japan's Nikkei lost 0.6% to end the week lower by 0.7%. Toshiba continued its recent woes, falling 9.2%. Sony Financial Holdings, Fast Retailing, Yokogawa Electric, Suzuki Motor, Nippon Express, and Familymart posted losses between 1.7% and 2.9%.
• Hong Kong'sHang Seng shed 0.3%, but gained 2.0% for the week. Financials lagged with Bank of East Asia, Bank of China, ICBC, and BoC Hong Kong losing between 1.1% and 4.0%. Select property names outperformed with Hang Lung Properties, Henderson Land, Cheung Kong Property Holdings, and Sino Land rising between 0.2% and 0.9%.
• China's Shanghai Composite lost 0.9%, narrowing its weekly gain to 0.2%. Shandong Lukang Pharmaceutical, YUD Yangtze River Investment Industry, Lingyuan Iron & Steel, Harbin Air Conditioning, and China Sports Industry Group posted losses between 4.4% and 5.1%.
• India's Sensex added 0.6%, extending its weekly gain to 0.8%. Sun Pharma jumped 4.0% while HDFC Bank and ICIC Bank posted respective gains of 3.8% and 1.5%. HDFC Bank outperformed after the Reserve Bank of India allowed foreign investors to buy more shares in the bank.

---FX---

• USDJPY -0.3% to 112.89
• USDCNY +0.2% to 6.8685
• USDINR -0.1% to 67.089

The Kraft Heinz Company (KHC) notes the recent speculation regarding a possible combination of Kraft and Unilever plc / Unilever NA.

• Kraft confirms that it has made a comprehensive proposal to Unilever about combining the two groups to create a leading consumer goods company with a mission of long-term growth and sustainable living.
• While Unilever has declined the proposal, the co states it looks forward to working to reach agreement on the terms of a transaction.

• Co reported FY16 EPS of JPY 338.52 vs JPY 362.52 last year; revs -12% YoY to JPY 3.337 trillion
• Co sees FY17 EPS of JPY 357.48; revs +8.8% or JPY 3.63 trillion

Major European indices trade mostly lower while the UK's FTSE (+0.2%) outperforms as the pound trades lower by 0.6% against the dollar at 1.2415. The euro (1.0645) has also retreated, shedding 0.3% versus the greenback. In France, socialist presidential candidate Benoit Hamon is reportedly discussing a joint candidacy with Jean-Luc Melenchon in order to present a greater challenge to National Front's Marine Le Pen.

• In economic data:
  • Eurozone December Current Account surplus narrowed to EUR31.00 billion from EUR36.40 billion (expected surplus of EUR35.00 billion)
  • UK's January Retail Sales -0.3% month-over-month (expected 0.9%; last -2.1%); +1.5% year-over-year (consensus 3.4%; last 4.1%). Core Retail Sales -0.2% month-over-month (expected 0.7%; last -2.2%); +2.6% year-over-year (consensus 3.9%; previous 4.7%)

---Equity Markets---

• UK's FTSE has climbed 0.2% with Unilever surging 13.7% after the company turned down an offer to merge with Kraft Heinz. Other consumer names also display relative strength with Imperial Brands, Reckitt Benckiser, Diageo, Associated British Foods, and British American Tobacco showing gains between 1.0% and 2.2%. Financials lag with Standard Chartered, RBS, Barclays, and Old Mutual falling between 1.2% and 3.2%.
• Germany's DAX is lower by 0.3%. Deutsche Bank is the weakest performer, falling 2.7%, while exporters Volkswagen, BMW, and Daimler are down between 0.9% and 2.6%. On the upside, insurer Allianz has climbed 2.4%.
• France's CAC trades down 0.8% with financials leading the retreat. AXA, BNP Paribas, Societe Generale, and Credit Agricole are down between 1.9% and 2.8%. Automakers Renault and Peugeot are both down near 1.7%. Danone outperforms, rising 3.2%.

Stocks with favorable mention: AGCO, CMG, CSCO, GLD, GOLD, GOOGL, MCD, MMM, MMP, MOS, MU, PEP, PFG, POT, SHLX, STZ, TWLO

Stocks with unfavorable mention: ABX, BUD, GEO, HLF, RAD

• As mentioned earlier, Mondelez (MDLZ) is lower by 5% as a result.
• M&A has been seen as an upside catalyst for the Food/CPG group, so Kraft's approach to Unilever removes it as a potential buyer of the other companies in the space. 

• New Oriental Education & Technology (EDU) disclosed in a regulatory following that, as part of the Registrant's efforts to streamline its corporate structure, the Registrant intends to wind up Shanghai Smart Words Software Technology Co., Ltd., a wholly-owned subsidiary of the Registrant in China and a company currently without business operations. Accordingly, the Registrant has removed Shanghai Smart Words as a party to the series of contractual arrangements whereby the Registrant, through its subsidiaries, controls and consolidates Beijing New Oriental Education & technology (Group) Co., Ltd. The rights and obligations of Shanghai Smart Words under the VIE Arrangements have been assumed by Beijing Decision Education & Consulting Co., Ltd., another wholly-owned subsidiary of the Registrant, which is an existing party to the VIE Agreements. Parties to the VIE Agreements entered into multiple agreements and amendments to effect the foregoing change.
• Chugai Pharmaceutical, a member of the Roche (RHHBY) group, announced that it has filed a new drug application to the Ministry of Health, Labour and Welfare (MHLW), for Engineered anti PD-L1 monoclonal antibody «atezolizumab (genetic recombinant)» for the treatment of «unresectable advanced or recurrent non-small cell lung cancer (NSCLC).»
• Cycle and Undertone, a division of Perion Network (PERI) announced an exclusive strategic partnership enabling Undertone to represent Cycle's branded content and social inventory to its prospective and current clients. In practice, the partnership will expand Undertone's suite of offerings to include Cycle's inventory and native ad offerings, as well as integrations into the media company's multiple ongoing video series.
• Medivir AB (MVIR) announced that departing CEO, Niklas Prager, CEO designate Christine Lind and CFO Ola Burmark today have bought a total of 16.500 shares in Medivir. The purchase was made simultaneously with their sale of a total of 52.101 redemption rights, which were received in connection with the ongoing voluntary redemption program.

Julia Stewart will resign from the Company, effective March 1, 2017.

• The Board has named its current lead director, Richard Dahl, to serve as interim CEO and chairman, effective March 1, 2017, while the board of directors conducts a search for a permanent replacement.

Concurrent with this leadership transition, co released prelim 4Q16 results.

• Sees adj. earnings per diluted share of $1.37, for 4Q16.
  • Current Consensus estimates Q4 adj. EPS of $1.39
• G&A expenses were $37 mln for 4Q16
• IHOP's domestic system-wide comparable same restaurant sales were -2.1% for 4Q16.
• Applebee's domestic system-wide comparable same-restaurant sales were -7.2% for 4Q16.

Co intends to report definitive 4Q16 and fiscal 2016 results and its outlook on March 1, 2017

Eurozone Core/Periphery Spreads Widen

• Debt of the eurozone periphery is underperforming debt of the eurozone core today, reversing a bit of narrowing in those spreads on Thursday following the release of the ECB minutes from the January meeting. The minutes said that policymakers saw deviation from the capital key as inevitable for the European Central Bank's asset purchase program. The capital key restriction means that bonds need to be bought from different countries in proportion to the size of each country's economy. Deviation from the capital key means, in practical terms, more purchases of Italian debt and fewer purchases of German debt. Also, since deviating from the capital key is seen as an alternative to buying debt with very negative yields, the German 2-year schatz (which yields -0.82%) sold off on Thursday's news but has rallied sharply this morning
• U.K. retail sales for January were weaker than economists had predicted and some fear that the weaker pound sterling and import price inflation will cut into consumers' purchasing power. The British pound sold off on the release and is now down 0.47% to $1.2426
• Central Banks:
  
  • ECB Governing Council member Philip Lane told the Wall Street Journal on Thursday that the central bank should continue to be open to further rate cuts. 
• European Economic Data:
  
  • The eurozone's current account surplus narrowed more than expected in December to EUR31 bln from EUR36.4 bln in November
    
    • For FY2016, however, the surplus hit a record-high 3.4% of GDP, up from 3.1% in 2015
  • Eurozone construction output fell 0.2% m/m in December but the year-on-year change was revised up to 3.2% after revisions to the prior month's reading
  • In the U.K., retail sales fell 0.3% m/m in January (+1.5% y/y), missing forecasts after a 2.1% slide in December
    
    • Core retail sales fell 0.2% m/m in January (+2.6% y/y), also missing forecasts. December's decline was 2.2%
    • Land values in the priciest districts of London fell 11.5% in 2016, according to Knight Frank. The decline was the the worst performance in five years, driven by higher taxes and Brexit. Home values in those districts fell 6.7% y/y in January
  • In Sweden, the consumer price index fell 0.7% m/m in January (+1.4% y/y)
• Yield Check:
  
  • France, 10-yr OAT: +1 bp to 1.02%
  • Germany, 10-yr bund: -5 bps to 0.30%
  • Greece, 10-yr note: +3 bps to 7.72%
  • Italy, 10-yr BTP: +4 bps to 2.18%
  • Portugal, 10-yr PGB: +4 bps to
  • Spain, 10-yr ODE: +1 bp to 1.60%
  • U.K., 10-yr gilt: -6 bps to 1.20%

• Snyder's-Lance, Inc. (LNCE) announced today that it made an investment in Denver, CO based Natural Foodworks Group, LLC, (NFG) an experienced food manufacturer specializing in natural and organic products. NFG has a proven track record of providing contract manufacturing services to entrepreneurs as they commercialize and scale their natural and organic brands to a larger audience of consumers. They make it possible for start-up brands to reach the production scale needed to serve natural retailers on a national basis. The investment and strategic partnership align with Snyder's-Lance's mission to expand better-for-you options focused on ingredients, quality and taste.
• London Stock Exchange Group (LDNXF) and Deutsche Börse AG (DBOEY) announced that the Financial Supervisory Authority of Norway has confirmed that it does not object to the change of control of LCH.Clearnet Ltd. Accordingly, the LSEG plc Norwegian Regulatory Condition in both the LSEG Acquisition and the Deutsche Börse Acquisition has been satisfied.

Gapping up
In reaction to strong earnings/guidance:

• TOPS +61.3%, RGSE +22%, (also completes offerings that raised total net proceeds of $16.0 million; regains Nasdaq compliance and now debt-free)
• TRUE +14.7%, AIRG +11.1%, COHU +11.1%, ANET +10.8%, TMST +10%, RWLK +8.7%, CYTK +7.1%, CGNX +5%, DE +3.7%
• TTD +3.6%, (also files registration statement for proposed follow-on offering by selling shareholders), IMGN +3.2%, GOL +3.2%, KEYS +3.1%
• WBMD +2.9%, (also commenced a process to explore and evaluate potential strategic alternatives ), RUTH +2.8%, CTB +2.1%, DVA +1%
• AUY +0.9%, DLR +0.9%, FIVN +0.8%

M&A news:

• LMIA +49.6% (to be acquired by Sonaca Group for $14.00 per share)
• UL +10.5% (Kraft Heinz (KHC) confirms that it made proposal to Unilever about combining the two groups), UN +9.4%, KHC +5.1%
• ZPIN +3.5% (Zhaopin special committee is in advanced discussions regarding a potential transaction after receiving preliminary non-binding proposal $18.00 in cash per ADS)

 Other news:

• HTBX +5.3% (presents data from its Phase 2 trial evaluating vesigenurtacel-L)
• AZN +1.7% (reports Phase III trial for Lynparza meets primary endpoint), LC +1.2% (modest rebound following yesterday's 8% decline)
• ARAY +0.9% (presents data from a Phase II study which showed that treatment with the CyberKnife System for low- and intermediate-risk prostate cancer provides 'excellent long-term results' at ASCOGU )
• CNHI +0.9% (in sympathy with DE results)
• ABBV +0.7% (authorizes a $5 bln increase to AbbVie's existing stock repurchase program)

Analyst comments:

• CC +1.4% (upgraded to Positive from Neutral at Susquehanna)
• TPX +0.9% (upgraded to Outperform at Raymond James)

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

Earlier this morning, Kraft Heinz (KHC 87.28, -3.81) announced that it has made a proposal to merge with U.K. consumer products giant Unilever (UL 47.02, +4.44). Unilever declined the initial bid, but Kraft said in a statement that it looks forward to «working to reach agreement on the terms of a transaction.»

Kraft and Unilever have added 4.5% and 9.6%, respectively, following the news while Kellogg (K 72.65, -2.06), General Mills (GIS 58.75, -2.79), and Mondelez Int'l (MDLZ 40.95, -2.25) have slipped between 2.8% and 5.0%.

In earnings news, Deere (DE 112.95, +3.27) is trading higher by 3.0% after it beat on the top and bottom lines and issued upside guidance. Similarly, WebMD Health (WBMD 53.40, +1.89) is up 3.7% after it reported better than expected earnings results and announced it was exploring strategic alternatives.

Gapping down
In reaction to disappointing earnings/guidance:

• HURN -12.9%, (Huron Consulting to acquire growth strategy firm Innosight; reports prelim 2016 results slightly below estimates and issues 2017 guidance)
• NUS -9.1%, ORC -8.8%, MCHX -5.5%, AEG -5.1%,
• FLS -4.2%, (also announces an order close to $80 mln to provide pumps and ebulators for the Hengli Integrated Refining Complex Project in China)
• GIS -4.1%, CINR -3.8%, (thinly traded), XRAY -3.4%, VECO -2.8%, SJM -2.8%, GVA -2.7%, VFC -2.4%, PES -2.3%, TRN -2.2%, MDRX -2.2%
• SE -2%, AMBR -1.2%, MRC -0.9%, MRC -0.9%, CPB -0.8%

M&A news:

• MDLZ -5.1% (after Kraft Heinz (KHC) says it is approaching Unilever)
• SAGE -4.3% (issues statement that co is not in M&A discussions)
• K -2.8% (following Kraft (KHC) proposal to combine with Unilever (UL))
• CREE -1% (Cree will terminate the definitive agreement to sell its Wolfspeed Power and RF division to Infineon Technologies AG), .

Select EU financial related names showing weakness:

• DB -3.5%, ING -2.5%, RBS -2.3%, BCS -2.2%, LYG -2%, SAN -2%, BBVA -1.9%

Select metals/mining stocks trading lower:

• HMY -4%, BBL -2.2%, BHP -2.1%, RIO -1.8%, AU -0.5%

Other news:

• BKD -4.1% (following late spike into the close on reports of potential interest from Ventas)
• LII -3.1% (Lennox Int'l issues statement, says it withdrew from presenting at the Barclays Industrial Select Conference next week because its CFO has a minor back injury that requires surgery)
• TSLA -1.6% (continued weakness)
• NAK -0.5% (responds to 'misleading criticism' in the February 14, 2017 report by Kerrisdale Capital; believes each claim is 'unfounded, contain numerous errors')

Analyst comments:

• HTZ -3.5% (downgraded to Underperform from Neutral at Credit Suisse)
• CAR -0.7% (downgraded to Neutral from Outperform at Credit Suisse)

• Also note the jump in volume/spikes among peers TMUS, VZ, and T.

Treasuries Rally to Close Slightly Lower on the Week

• U.S. Treasuries traded higher today as equities digested some of this week's gains and the U.S. economic data flow slowed to a trickle. The Conference Board's Leading Index rose 0.6% m/m in January, beating the Briefing.com consensus for a 0.5% gain and capping the economic data releases for the week. The Bank of America Merrill Lynch Global Fund Manager Survey now shows that almost 80% of respondents expect the global economy to grow above trend growth for the next 12 months, up from less than 10% in the summer of 2016. The significance here is that expectations for a growth rebound could already be baked into interest rates. In other news, the IMF will contribute EUR5 bln to Greece's third bailout program, according to Spiegel. The S&P 500 is down just 0.04% to 2,346.2 ahead of the long weekend, up from a session low of 2,339.5
• Yield Check:
  
  • 2-yr: -1 bp to 1.19%
  • 5-yr: -3 bps to 1.91%
  • 10-yr: -3 bps to 2.42%
  • 30-yr: -2 bps to 3.03%

• News:
  
  • The Conference Board's Leading Index rose 0.6% m/m in January. That was its best gain since April 2016. The Briefing.com consensus was 0.5% as was December's change
  • The New York Fed's Nowcast for Q1 real U.S. GDP growth is unchanged at 3.1% this week
    
    • The Atlanta Fed's GDPNow model forecast is at 2.4% and the St. Louis Fed has 2.0%
  • The BofA Merrill Lynch Global Fund Manager Survey shows that almost 80% of respondents now expect the global economy to growth above trend for the next 12 months, up from less than 10% in the summer of 2016
  • The International Monetary Fund is now likely to contribute EUR5 bln to Greece's bailout, according to Spiegel

• Commodities:
  
  • WTI crude: -0.04% to $53.34/bbl.
  • Gold: -0.41% to $1,236.5/troy oz.
  • Copper: -0.48% to $2.7055/lb.

• Currencies:
  
  • EUR/USD: -0.53% to 1.0609
  • USD/JPY: -0.39% to 112.93

• Data out Friday:
  
  • Monday: Holiday
  • Tuesday: Minneapolis Fed President Kashkari (FOMC voter) (08:50 ET); Philadelphia Fed President Harket (FOMC voter) (12:00 ET); $26 bln 2-year Treasury auction (results at 13:00 ET); San Francisco Fed President Williams (non-FOMC voter) (15:30 ET)
  • Wednesday: MBA Mortgage Index for the week ending 2/18 (07:00 ET); January Existing Home Sales (10:00 ET); $34 bln 5-year Treasury auction (results at 13:00 ET); Fed Governor Powell (FOMC voter) (13:00 ET); FOMC Minutes from 1/31-2/1 meeting (14:00 ET)
  • Thursday: Initial Jobless Claims for the week ending 2/18 and Continuing Jobless Claims for the week ending 2/11 (08:30 ET); December FHFA Housing Price Index (09:00 ET); Natural Gas Inventories for the week ending 2/18 (10:30 ET); Crude Inventories for the week ending 2/18 (11:00 ET); $28 bln 7-year Treasury auction (results at 13:00 ET)
  • Friday: February Michigan Sentiment — Final (10:00 ET); January New Home Sales (10:00 ET)

The Energy Sector (XLE, -0.7%) leads the broader market (SPY, -0.02%) lower in the last hour of the trading day. Crude oil (USO, -0.1%) futures end flat following the release of rig count data summarized below. Lastly, natural gas (UNG, -0.3%) futures extend yesterday's post-EIA losses and end at a fresh 3-month low, modestly lower compared to yesterday's pit trading close.

Rig count data highlights:

• The Baker Hughes (BHI, -0.7%) total U.S. rig count (includes natural gas rigs) increased by 10 to 751 rigs, following last week's increase of 12 rigs.
• The number of active U.S. rigs drilling for oil rose by 6 to 597 rigs this week.
• This marks the fifth weekly oil rig count increase in a row.
• The rig count has increased for 15 out of the past 16 weeks.

Next week/upcoming data reminders:

• API data will be released next Tuesday at 4:30 pm ET.
• EIA petroleum data will be released Wed at 10:30 am ET.
• EIA natural gas data will be released Thursday at 10:30 am ET.
• The next Baker Hughes rig count data will be released next Friday at 1 pm ET.
• The next official OPEC meeting is scheduled to take place on May 25 in Vienna, Austria.

Notable Gainers:

• Oil & Gas Drilling & Exploration: ECA Marcellus Trust I (ECT, +6%)
• Equipment and services: Synergy Resources (SYRG, +3%)
• Independent oil & gas: Petroquest Energy (PQ, +9%)
• Major-integrated: Petrobras Argentina (PZE, +1%)
• Refining & Marketing: Renewable Energy Group (REGI, +1%)
• Pipelines: Spectra Energy Partners (SEP, +1%)

Notable Laggards:

• Oil & Gas Drilling & Exploration: Pioneer Energy Services (PES, -10%)
• Equipment and services: Weatherford (WFT, -4%)
• Independent oil & gas: Mexco Energy (MXC, -12%)
• Major-integrated: Eni (E, -2%)
• Refining & Marketing: Calumet Specialty Products Partners (CLMT, -3%)
• Pipelines: Star Gas Partners (SGU, -7%)

Closing Energy Prices:

• April crude oil futures rose $0.01 (+0.02%) to $53.79/barrel
  • Crude oil futures have switched their front month to April from March, as indicated by the active amount of volume in the contracts
• Mar natural gas closed $0.01 lower (-0.4%) at $2.84/MMBtu
• April RBOB gasoline closed $0.01 lower (-0.6%) at $1.74/gallon
• Mar heating oil futures closed $0.01 higher (+0.6%) at $1.64/gallon

Earnings/News

• Pioneer Energy (PES, -9%) misses by $0.03, beats on revs
  • Reported Q4 net loss of $0.34 per share, excluding non-recurring items, $0.03 worse than the Capital IQ Consensus of ($0.31); revenues fell 31.6% year/year to $71.5 mln vs the $70.28 mln Capital IQ Consensus.
• Matador Resources (MTDR, -0.2%) formed a JV for Delaware basin midstream assets; Five Point provided $176.4 mln in exchange for a 49% interest
  • Co announced the formation of San Mateo Midstream, a strategic JV between a wholly-owned subsidiary of Matador and a subsidiary of Five Point Capital Partners to operate and expand Matador's midstream assets in the Delaware Basin in Eddy County, New Mexico and Loving County, Texas.
  • Matador received $171.5 mln in connection with the formation of the JV and may earn up to an additional $73.5 mln in deferred performance incentives over the next five years. Matador will continue to operate the Midstream Assets and control the joint venture. At formation, Matador and Five Point owned 51% and 49% of the JV, respectively.
• Gastar Exploration (GST, +10%) entered into a definitive securities purchase agreement with funds managed by affiliates of Ares Management (ARES, -0.2%) that provides for $425 mln in new financing to the co in the form of a $250 mln secured term loan, $125 mln secured convertible notes and a $50 mln common stock issuance; provides capex guidance
  • Proceeds from the Ares Investment will be used to fully repay Gastar's existing $70.4 mln revolving credit facility and redeem its $325 mln senior secured notes due May 2018.
  • Gastar's 2017 capital budget is ~$84.0 mln comprised of $46.0 mln of drilling and completion costs, $30.8 mln in leasing costs and $7.2 mln for capitalized interest and administration costs.

Broker Calls

• Genesis Energy (GEL, -3%) downgraded to Equal Weight at CapitalOne
• Cimarex (XEC, -1%) upgraded to Buy at KLR Group
• Superior Energy (SPN, -4%) downgraded to Hold at Jefferies
• Arch Coal (ARCH, +4%) initiated with a Buy at Jefferies

• Natural gas extended yesterday's post-EIA losses, ended pit trading at a 3-month low for the 2nd consecutive session
  • Mar natural gas closed $0.01 lower (-0.4%) at $2.84/MMBtu
• In precious metals, gold retreated from yesterday's 1-week high on renewed dollar index strength
  
  • April 2017 gold ended today's session down $2.40 to (-0.2%) $1239.10/oz
  • Mar 2017 silver closed today's session $0.05 lower (-0.3%) at $18.03/oz
• The dollar index was +0.5% around the 100.92 level, weighed on precious metals
  
  • Commodities, as measured by the Bloomberg Commodity Index, were -0.4% around the 88.11 level
• Crude oil futures ended nearly flat following rig count data, which showed active oil rigs drilling have increased in the US for the 5th week in a row
  • April crude oil futures rose $0.01 (+0.02%) to $53.79/barrel
  • Rig count data highlights:
    • The Baker Hughes total U.S. rig count (includes natural gas rigs) increased by 10 to 751 rigs, following last week's increase of 12 rigs.
    • The number of active U.S. rigs drilling for oil rose by 6 to 597 rigs this week.
    • This marks the fifth weekly oil rig count increase in a row.
    • The rig count has increased for 15 out of the past 16 weeks.

The following options are exhibiting notable trading, potentially indicating changing sentiment toward the underlying stocks, and/or potentially representing positioning for increased volatility.

Bullish Call Activity:

• UL Mar 45 calls after company confirmed approach by Kraft Heinz (volume: 3140, open int: 3270, implied vol: ~29%, prev day implied vol: 7%) — co is scheduled to present at Seamless Africa on March 14.  Co is expected to report earnings mid-late April.
• ERII Aug 12.5 calls (volume: 1540, open int: 240, implied vol: ~60%, prev day implied vol: 57%) — co is expected to report earnings early March.

Bearish Put Activity:

• CMA Mar 67.5 puts (volume: 1770, open int: 390, implied vol: ~27%, prev day implied vol: 25%)  — co reported earnings mid-January and is expected to report its next quarterly earnings mid-April.
• ORCL Weekly Mar24 40 puts (volume: 4820, open int: 170, implied vol: ~21%, prev day implied vol: 20%) — co is expected to report earnings mid-March, possibly within the weekly March expiration cycle.

Sentiment: The CBOE Put/Call ratio is currently: 0.99… VIX: (11.73, -0.03, -0.3%).
Today is options expiration — the last day to trade February equity options.
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• Monday (February 20)
  • Markets Closed in Observance Of Presidents' Day        
• Tuesday (February 21)
  • Pre-Market: WMT, MDT, GPC, ECL, HSIC, SAH, PWR, AAP, WLK, AGR, EXPD, AER, FDP, SNI, WAB, CBRL, MDR, CEQP, TVPT, SOHU, WLKP, NEWM, RRGB, ASTE, LL, THRM, FELE, NRZ, RBA, CYOU, DAKT, etc...
  • After-Hours: EIX, XPO, FE, NEM, TX, QUAD, WCN, HLS, TEX, AWK, KAR, VMI, CXO, VRSK, TXRH, MATX, PZZA, FSLR, LZB, NFX, WLL, SPN, CHEF, KALU, SHO, EXR, etc... 
• Wednesday (February 22)
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  • After-Hours: HPQ, ETE, ETP, LB, SUN, SXL, TSLA, SPTN, ARRS, Y, TS, TSE, RIG, CVG, FIT, CTRP, UFPI, VVC, PSA, CAKE, CLR, WR, NBR, RRC, TROX, DOOR, WGP, CLGX, ALDW, WES, OGS, TRNC, etc...
• Thursday (February 23)
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• Friday (February 24)
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  • After-Hours: ENH