Mid-Morning Look: July 27, 2023

Mid-Morning Look

Thursday, July 27, 2023






DJ Industrials




S&P 500








Russell 2000






U.S. stocks a strong push to starts the day as the S&P 500 (SPX) topped 4,600, to new 52-week highs (all-time highs 4,816.62 on 1/4/22), and the Dow Jones Industrial Average remains on track for 14th straight day of gains (Refinitiv data going back to January 1920 shows no winning streak of more than 13-straight days for the Dow). Strong economic data, decelerating inflation and strong earnings continuing to push stock markets higher. Of the companies that have reported thus far, 81% have beaten analyst expectations, according to FactSet. Big earnings movers this morning include META in social media after beat and strong guidance, semiconductors jump on handful of positive updates (LRCX, STM, Aixtron), Consumer Discretionary among the leaders. Stock have since pulled back off highs, but now at morning lows (Transports down -0.85% on day behind airlines weakness). 


Economic data very strong this morning as Q2 GDP rose at a 2.4% annual rate, picking up from Q1’s 2% pace and defying views for a slowdown to 1.5%. Consumer spending slowed to a 1.6% annualized rate from 4.2% in Q1. June durable goods orders surged 4.7% in June, crushing views for a 0.5% gain, after May’s upwardly revised 2% advance. Jobless claims fell 7,000 to 221,00 in the week ended July 22 vs. views for a gain to 235,000. In Central bank news, the European Central Bank raised its key rate by a quarter-point to 3.75%, as expected, following the Fed’s 25-bps hike yesterday. Treasury yields rise with the 10-yr +8.3 bps to 3.935% and the 2-yr +9.4 bps to 4.915% after the Fed’s latest rate increase, as well as a boost from fresh data this morning pointing to a still hot economy.


Economic Data

·     Weekly Jobless Claims fell to 221K from 228 prior week and below ests 235K; the 4-week moving average fell to 233,750 from 237,500 prior week; Continued Claims fell to 1.690M from 1.749M prior week (and est. 1.75M) and insured unemployment rate fell to 1.1% from 1.2% prior.

·     GDP for Q2 rises +2.4% vs. +1.5% expected and +2.0% in Q1; the PCE Price index reported at +2.6% vs. +4.1% in Q1 and core PCE price index +3.8% vs. +4.0% expected and +4.9% in Q1. The personal consumption expenditures (PCE) +1.6% vs. +1.5% expected and +4.2% prior.

·     June Retail Inventories (Advance) rises +0.7% to $783.9B vs. +0.8% prior and on a Y/Y basis, retail inventories rose 5.4% in June; Wholesale Inventories (Advance) for June fell (-0.3%) M/M to $908B vs. +0.1% consensus and -0.1% prior.

·     International Trade in Goods (Advance) for June declined (-4.4%) to $87.8B vs. -$91.8B consensus and -$91.9B in May.

·     June Pending Home sales index rose +0.3% vs. est. (-0.5%); sales (-15.6%) from June 2022.







WTI Crude















10-Year Note





Sector Movers Today

·     Semiconductors a standout in flurry of upbeat results: 1) LRCX lifting equipment names early (AMAT ) after reported Jun Q results & Sep Q guidance above consensus; 2) STM posted higher Q2 sales helped by automotive demand; 3) and Aixtron raised its annual outlook on solid Q2 results. LRCX reported Jun Q results & Sep Q guidance above consensus as strength from China (lagging edge) & HBM (for Gen AI) is helping drive a C2H23 WFE profile better than C1H. Aixtron raised outlook as now sees full year revenues in the range of 600-660 million euros ($666 million-$732 million) and order intake between 620-700 million euros.

·     Large cap banks dipped initially after U.S. bank regulators unveil proposal to raise bank capital requirements as proposal would implement international Basel agreement on risk-based capital standards and apply stricter rules to banks with over $100 bln in assets. The proposal would require all banks with over $100 bln in assets to account for unrealized gains and losses on available-for-sale securities.

·     Precious metals slide as gold prices dropped over 1% on stronger dollar and spike in Treasury yields after yesterday FOMC rate hike as well as round of stronger economic data keeping chances of additional rate hikes by the Fed on the table at September meeting.



·     ALGN +15%; following 2Q cases/revenue that exceeded consensus by 2%/1% against low investor expectations into results, 3Q revenue guidance came in 1% ahead at the midpoint.

·     CMCSA +7%; Q2 EPS $1.13 tops est. 97c and revs $30.51B beats $310.1B est. noting Peacock streaming rev rose 84.7% and paid subscribers rose by 2 mln sequentially, to 24 mln; better media and theme park revs.

·     ENVX +14%; said produced 22.5k units in 2Q23 compared to 12.5k units in 1Q; guided to 36k units in 3Q and said has sampled 121 customers as of 2Q23, +14% from 106 customers in 1Q23.

·     META +8%; better-than-expected 2Q print and guided to 3Q revenue of $32- $34.5bn, which at the high end implies 21% y/y FXN growth, well above expectations.

·     OSTK +22%; after Q2 results topped consensus and CEO said the acquisition of the Bed Bath & Beyond brand is the beginning of a new phase of growth for them.

·     RCL +6%; after upbeat guidance; sees FY adj EPS $6.00-$6.20, saw $4.40-$4.80.

·     TXT +9%; approves new buyback authorization of up to 35m shares while raises FY EPS to $5.20-$5.30 from prior $5.00-$5.20 after Q2 adj EPS and revenue beat.

·     WU +4%; reported a sizeable revenue driven beat and raised full year revenue and EPS outlook lifting shares.



·     BHVN -26%; after says was informed by the FDA they would not review NDA for troriluzole because primary endpoint was not met; co provides preliminary EEG data update for kv7 platform, regulatory update on troriluzole and other corporate updates.

·     BMY -2%; trades to 52-week lows as lowered the year’s EPS to $7.35-$7.65, from the prior $7.95-$8.25 after missing both top and bottom-line results for Q2.

·     CMG -8%; as Q2 EPS beat but sales shy of consensus and comp sales in-line to slight miss at 7.4% but Q3 outlook implies downside to Street numbers as comp-sales growth is projected to moderate to the LSD-MSD range.

·     CROX -14%; shares slid as posted beat for Q2 profit and sales, and raised FY outlook for both, though guided Q3 revs $1.01B-$1.03B below est. $1.06B.

·     EBAY -7%; beat consensus on the top and bottom line for Q2 while guidance for GMV and revenue were both slightly above expectations for 3Q and full year, but margins were lower.

·     EW -7%; reports beat and small raise on lower end of profit guide, but Q2 TAVR sales grew 9%; constant currency sales grew 10%.

·     EYE -13%; shares fell after the optical retailer said that its contract with WMT won’t be renewed after it ends in February.

·     LUV -9%; reports Q2 $1.09 vs. est. $1.10 on slightly better revs; said is revamping its 2024 flight schedules to reflect post-pandemic changes to Customer travel patterns; downgraded to Neutral from Buy at Bank America after results.

·     MRSN -74%; after the co announced a broad restructuring following the failure of its lead product candidate in a late-stage study; said study of upifitamab rilsodotin missed its primary endpoint in patients with platinum-resistant ovarian cancer.

·     NEM -2%; gold prices drop over -1% as markets rotate further into riskier assets; while the dollar rises on better economic data; silver down as well – NEM, AEM, GOLD, AUY slip.

·     NOVA -12%; 2Q revenue of $166.4M was below our estimate of $192.7M, while adjusted EBITDA of $28.1M came in below B Riley $46.3M.

·     PI -4%; as guides Q3 EPS loss to (12c)-(6c) vs. est. +$0.38 and revs $63M-$66M, below consensus $88.11M.

·     SIMO -12%; follow-through decline from Wednesday after MXL announced that it has exercised its contractual rights to terminate its May 5, 2022 merger agreement with SIMO.

·     TPIC -31%; downgraded by BTIG, Hallum, Roth as preannounced 2Q23 results with an expected 2Q23 Adjusted EBITDA loss of $36-41M which was well below consensus of +$8M.

·     TREE -19%; sees Q3 revenue $155M-$170M below consensus $195.72M, which follows Q2 rev miss of $182.5M vs. est. $193.6M.


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.