Market Review: May 03, 2024

Closing Recap

Friday, May 03, 2024





DJ Industrials




S&P 500








Russell 2000













Stocks finish just off highs as a big push at the tail end of the week lifts major averages to weekly gains, buoyed on strong breadth (3:1 advancers led) as ten of eleven sectors were higher. U.S. stocks started higher overnight on better Apple (AAPL) earnings and comments, while a softer monthly jobs nonfarm payroll report accompanied by slowing wages provided more ammo for Bulls as major averages finished the day and week in positive territory. April Nonfarm payrolls slowed to 175,000 jobs last month, below estimates of 240,000 and down from the upwardly revised number of 315,000 in March, while the unemployment rate rose to 3.9% from 3.8%, and wages increased less than expected, rising 3.9% y/y and +0.2% m/m, both below consensus. The data pushed Treasury prices higher (yields lower) on hopes the Fed may act on rate cuts sooner than markets were currently forecasting (was currently seen first cut Sept/Nov) amid the slowing economy. The problem that remains for the Fed is inflation, with several data points in recent weeks showing prices are not decelerating but inching higher in recent months. Apple (AAPL) shares lifted the Dow and Nasdaq following a pretty straightforward print mainly in-line with the street, but was better than feared results, along with a record $110B stock buyback plan and better China commentary helping lift shares of the mega cap tech giant and boosting other tech names/supply chain semis in response. All sectors in the S&P were up except for energy which declined with lower energy prices. For the week, the S&P 500 gained 0.55%, the Nasdaq climbed 1.43%, and the Dow climbed 1.14%.

Economic Data

  • April Nonfarm payrolls climb 175k m/m, worse than the expected rise of +240k, while private sector jobs rose +167,000 below consensus +190,000 and factory jobs +8,000 above consensus +5,000. The unemployment rate rises to 3.9% from 3.8% (which was also the estimate), as labor force participation rate stays at 62.7%. Average hourly earnings rose +0.2% vs. est. +0.3% and on a Y/Y basis rose 3.9% below estimate 4.0%. April average hourly earnings +3.9% year/year vs. +4% est. & +4.1% prior.
  • ISM non-manufacturing sector shows PMI 49.4 in April below consensus 52.0 and vs 51.4 in March; business activity index 50.9 in April vs 57.4 in March, paid index jumps to 59.2 in April vs 53.4 in March, new orders index 52.2 in April vs 54.4 in March and non-manufacturing employment index 45.9 in April vs 48.5 in March.

Commodities, Currencies & Treasuries

  • U.S. crude oil futures settle at $78.11/bbl, down -$0.84 or 1.06% (down -6.8% for week) while Brent Crude futures settle at $82.96/bbl, down -$0.71 cents, or 0.85% (down -6% for week). Natural gas prices ended the day higher by 5.26%, posting an 11.3% gain on the week to $2.142 mln btus, snapping a 3-week losing streak (YTD still down -14.8%).
  • Gold prices dipped back around the $2,300 an ounce level, before settling at $2,308.60 an ounce, down a buck on the day but down about 5.6% or about $140, since hitting a record high of $2,431.29 in April, which was driven by flare-ups in the Middle East and strong central bank buying. Gold prices hitting one-month lows today despite weaker-than-expected U.S. jobs data.
  • The dollar index (DXY) slumped -0.25% back to the 105 level; Bitcoin prices rebounded over 5% around the $62,000 level along with a broad-based rally of risk assets and Treasury yields slumped on the day following the jobs report as the 10-yr yield dropped -7.4bps to 4.498% (down -17bps on week) and the 2-yr down 7.3 bps to 4.804% (down -19.4bps on week).
  • Cocoa futures on the ICE exchange regained some ground on Friday after sharp losses the day before, but ended the week with a 23% net loss, while robusta coffee prices slipped further to end the week 15% down.





WTI Crude















10-Year Note




Sector News Breakdown

Retail, Consumer Staples & Restaurants:

  • In Food & Beverage: MNST reported a 12% jump in Q1 revenue, topping estimates, helped by steady demand for the energy drink maker’s high-priced juices as well as easing freight costs. HSY posted a beat for Q1 EPS and sales citing demand for its chocolates and snacks, as well as higher prices (Q1 EPS $3.07/$3.25B vs. $2.76/$3.11B) and reiterates full-year 2024 forecast.
  • In Restaurants: BJRI reported upside Q1 margin, EPS, and adjusted EBITDA results that saw only slight revenue upside due to January weather impacts; comp store sales of (-1.7%) were slightly above consensus of (-2.1%) driving revenue of $337M vs consensus of $335M and restaurant level operating margins were well above consensus; LOCO Q1 revenues of $116M exceeded consensus expectations of $111M, with restaurant lever operating margin of 17.6% (up 260bps y-o-y) coming in well above consensus of 15.5% with E{S and adj EBITDA beats as well; TXRH top and bottom line beat and reiterate guidance.

Leisure, Gaming & Lodging:

  • In Leisure: LYV shares among top gainers in the S&P 500 after earnings as reported a meaningful beat on Q1 revenue and AOI on continued healthy demand, and management indicated that they are approaching the final phase of the DOJ investigation in preparation for discussions with senior DOJ leadership; Q1 adj operating income up 15% to $367M. In auto suppliers, MGA shares fell after cutting its annual forecast while AXL rose after beating and reaffirming guidance.
  • In Online travel: two very different earnings reports as BKNG shares jumped as Q1 gross bookings of $43.5B topped consensus of $42.16B handily, backstopped by 8.5% y/y growth in room-nights vs consensus of 5.5% and the high-end of guidance at 6%, though guided a bit soft on Q2; while EXPE shares tumbled after cutting full-year revenue growth forecast to a range of mid to high single digit top line growth as gross bookings hit by drag in vacation rental platform, poor B2C segment performance (Vrbo adoption is slower than expected).
  • In Casino and Gaming: DKNG reported Q124 revenue of $1.175B, increasing 53% YoY, exceeding expectations despite headwinds to sporting outcomes in several parts of the quarter; beat was broad-based, including gross margins 400 bps above expectations (+564 bps YoY), and EBITDA of +$22M compared consensus of +$5M; DKNG increased MUPs 23% YoY, below 35% in Q423 and 44% in Q323; that said, it did not capture a full quarter of players in North Carolina (March 11 launch). In gaming technology, Stifel previewed quarter saying they forecast beats from AGS, IGT, & LNW and inline for EVRI as regional same-store GGR trends improved following well-discussed adverse weather in January.


  • In E&P Sector: CTRA Q1 profit topped with EPS $0.51 vs. est. $0.41 and raises 2024 oil production outlook to 107,000 boepd from 102,000 boepd, up 2.5% at the mid-point of prior expectation; EOG posted Q1 EPS beat of $2.82 vs. est. $2.70; Q1 revs $6.123B vs. est. $5.92B; Quarterly crude oil and condensate production was up 6.5% at 487,400 barrels of oil per day (boepd) from the previous year. US weekly Baker Hughes (BKR) gas rig count down -3 to 102 – US oil rig count down 7 to 499 – US total rig count 605 – Baker Hughes.
  • In Transports: Dow Transports extend Thursday gains as XPO shares jumped after Q1 adj EPS $0.81 topped the $0.67 estimate on better revs of $2.02B and reports North American Less-Than-Truckload (LTL) revenue of $1.22B and European transportation revenue of $797M; UNP upgraded to Buy from Hold at Stifel and raise tgt to $267 from $248 after hosted Jim Vena and Jennifer Hamann to discuss the progress at Union Pacific and the current rail freight environment. Dow Transports jumped 2.5% on Thursday behind a spike in CHRW after results.
  • In E&C Sector: MTZ reported 1Q adjusted EPS of ($0.13), an improvement over the guidance of ($0.48) and revenue growth was 4% vs. guidance, beating in all segments except Clean Energy; Q1 adjusted EBITDA was $164M vs. consensus of $130M, and adjusted EBITDA margin was 6.1% vs. our Keybanc est. 4.9%. FLR reported Q1 EPS $0.47 missed the $0.54 consensus on weaker revs $3.7B (vs. est. $4.0B) while affirmed year profit.
  • In Chemicals: HUN Q1 EBITDA of $81M, compared to consensus of $77M as Keybanc noted the company beat in Polyurethanes (PU) and Performance Products (PP) while missing in Advanced Materials (AM) and volumes in both PU and PP improved for the first time since Q122. Similar to peers DOW, LYB, WLK, and OLN this earnings season, HUN saw earnings bounce off the Q4 bottom, mostly as volumes come back.


  • In Fintech: SQ shares jumped after boosting its year outlook following all around strong Q1 results – posted Q1 gross profit 3% above consensus and EBITDA 105M above consensus, while 2024 EBITDA guidance was raised by 4%; guides FY24 adjusted EBITDA $2.76B above prior view at least $2.63B and Q2 adjusted EBITDA $670M-$690M.
  • In Crypto: Bitcoin bounced over 5% to $61,750 as crypto rebounds following recent pullback; MSTR shares outperforms, rising above $1,200 after weekly lows $1,010 on Wednesday after Q1 revs missed. COIN Q1 revs $1.59B vs. est. $1.32B; Q1 adjusted EBITDA $1.014B vs $287M last year; sees Q2 subscription and services revenue $525M-$600M was the good while said after Q1 consumer trading volumes jumped 93% q/q, will have to spend more to maintain its trading infrastructure.


  • AMH Q1 results were relatively stable, with 1Q24 Core FFO in line and management affirmed 2024 guidance. Operating trends in 1Q24 imply stability through the quarter, with a slight uptick in March vs. February.
  • CPT Q1 core FFO beat consensus and was just above the high end of management’s quarterly guidance. While expense savings related to lower property taxes and insurance costs resulting in a 125 bps decrease to the Company’s 2024 expense growth guidance, this was offset by higher interest expense, and the midpoint of Core FFO guidance was affirmed.
  • DRH Q1 Adj. EBITDA and Adj. FFO beat expectations. RevPAR growth decreased marginally vs. last year (-0.4%) but was more than offset by outsized growth in out-of-room spend (+12%), which was largely in line with the Company’s forecast.
  • KRC reported 1Q24 FFO of $1.11, which beat consensus of $1.07 and our estimate of $1.08. Importantly, management increased its FY24 FFO guidance range to $4.15-$4.30 (from $4.10-$4.25), or ~1.2% at the midpoint, and as a result, we expect 2024 FFO consensus estimates to be revised higher by ~0.6% in the NT.
  • XHR posted a solid 1Q adjusted EBITDA and adjusted FFO beat, with RevPAR growth exceeding management’s expectations. Despite coming in ahead of management’s initial expectations, XHR affirmed guidance.

Biotech & Pharma:

  • AMGN shares surged after earnings results and news it is working on two weight-loss drugs: MariTide which is in mid-stage testing for weight loss in adults with or without obesity and wrapped a Phase 1 study of its other obesity drug, a small molecule medicine known as AMG 786; the AMGN headlines weighed on shares of competing obesity drug makers NVO, LLY, VKTX, were active in reaction.
  • ARDX reported Q1 revenue of $46M, above consensus of $36ME driven by higher than anticipated Xphozah sales of $15.2M vs. consensus of $6.5M.
  • TWST after posted a Q2 beat & FY24′ guide raise to total revs of $300-304M (prior $288-293M) representing 22%-24% growth y/y & GM guide of 41.5%-42% (prior 40-41%).
  • In Insulin space: TNDM delivered Q1 results which were better than expected and increased top line guidance to 12% growth and maintained AEBTIDA breakeven guidance.


  • AAPL shares jump following an in-line to slightly better earnings/segment results, buoyed by a massive $110B stock buyback plan and dividend boost (offsets news that revenues fell -4.3% y/y, the 5th quarter in last 6 with decelerating y/y revs). Markets chalking the rally in AAPL on a “better-than-feared” quarter and the buyback news certainly helping.
  • GOOGL shares tumbled as the U.S. gov’t today will lay out its antitrust case against the Co on Friday in a second day of closing arguments focused on accusations that the online search leader broke the law to stay on top in search advertising. The Justice Department has hammered away at Google in a trial that started on Sept. 12, arguing the search engine giant is a monopolist.
  • MELI shares jumped following earnings results; Q1 EPS $6.78 vs. est. $6.03; Q1 revs rose 36% y/y to $4.33B vs. est. $3.85B; Sales from its main marketplace business rose 36% in Brazil, its top market, and 42% in Mexico, as measured by Gross Merchandise Value (GMV); Operational margins came in at 12.4%, up from the 11.2% a year earlier.
  • In Media & Telecom: The NBA agrees to general framework of new long-term broadcasting agreements DIS & AMZN worth $2.6B and $1.8B per year respectively, Bloomberg reported last night; UNIT enters into a definitive agreement to merge with Windstream Holdings; in cable, WOW rises after shareholder Crestview says it and DigitalBridge submitted a joint, preliminary non-binding proposal to buy the cable service provider for $4.80 per Class A share. PARA was downgraded to Sell at Argus saying Paramount’s sale process has become a fiasco as CEO Bakish steps down. FUBO guided Q2 revs $357.5M-$367.5M vs. consensus of $355.2M after Q1 results topped expectations. PARA shares fell late day after Variety reported currently it is expected that neither of the two takeover offers for Paramount — neither the one from Skydance or Sony (SONY) and Apollo (APO) — will come to fruition

Hardware & Software movers:

  • ALTR delivered solid results that were above expectations with the upside driven by good execution, but also some deal pull-ins. Q2/24 software and total revenue guidance fell short of expectations.
  • ANET was upgraded to Buy at Jefferies and boosted tgt to $320 amid “extraordinary cloud capex” and points to ANET as a prime artificial intelligence beneficiary as better versions of Ethernet increasingly go into back-end data center networks.
  • NET shares decline as Q1 operating loss widens to $54.6M from $47.3M, while Q1 sales and marketing expenses jumped about 42% to $194.1M and forecasts in-line revs at $393.5M-$394.5M vs. est. $393.5M.
  • OTEX downgraded to Market Perform at BMO Capital and cut tgt following Q3/24 results that were roughly in line, while OTEX’s preliminary FY2025 guidance was significantly weaker than expected.
  • SPT tumbles as downgraded by several analysts after cuts FY revenue forecast to $405M-$406M below prior view $425.3M-$425.5M saying they underestimated the magnitude of enterprise seasonality and faced sales execution challenges.
  • TRMB shares fell after saying the Company’s disclosure controls and procedures were not effective as of December 29, 2023 due to the material weakness in internal control over financial reporting.
  • In Internet security: FTNT shares slip following a 1Q billings miss and 2Q billings guide below; 1Q margins & FCF both solidly beat; FY24 billings guide was maintained despite the 1Q/2Q miss and FY24 revenue/EBIT guided above; posted -18% y/y product growth and -6% billings growth this quarter.


  • Impact from AAPL earnings in semi supply chain: Keybanc noted that AAPL posted F2Q24 (March) iPhone revenues ($46.0B, -11% y/y), which were in line with expectations and its prior guidance, tracking flat y/y if adjusted for the $5B pent-up demand related to iPhone 14 Pro/Max in F2Q23. Notably, iPhone sales in China were up y/y, despite a tough comparison, much better than feared given sell-through was down ~20% y/y. Additionally, in conjunction with emerging market growth, this was offset by weaker demand in mature markets in RoW. For F3Q24 (June), AAPL’s outlook for total revenues to be up LSD% y/y implies iPhone revenues are expected to decline MSD% y/y, which is slightly below the consensus ($38.6B, -2.7% y/y). They view AAPL’s results/guidance as neutral for supply chain coverage universe (ARM, AVGO, CRUS, QCOM, QRVO, and SWKS)


Market commentary provided by Hammerstone Markets, Inc, a firm separate from and not affiliated with Regal Securities. Regal Securities has not participated in the creation of the content, and does not explicitly or implicitly endorse the content.