Mid-Morning Look: March 21, 2024

Mid-Morning Look

Thursday, March 21, 2024





DJ Industrials




S&P 500








Russell 2000






U.S. stocks are at it again, hitting fresh intraday all-time highs for the S&P 500, Nasdaq, and Dow Industrials as the party rages on for Wall Street, hooked on low interest rate “hopes” after Fed Chairman Powell and the FOMC maintained their outlook for three cuts in 2024 despite noting higher CPI, PPI inflation data the last 2-months. Nasdaq extends gains, up over 1% topping prior all-time high 16,449 (on March 8th), while the Dow approaches 40,000 and the S&P 500 (SPX) tops 5,250. The CBOE Volatility index (VIX) falls below 12.80 to its lowest since early February as markets remain unafraid. One of Wall Street “darling” sectors, semiconductors (SOX) which saw a decent pullback the last week on profit taking, saw a surge the last two-days behind Micron (MU) earnings overnight, AVGO positive investor day comments, ALAB AI IPO optimism, and of course NVDA extended rally after its GTC 2024 event this week. The U.S. dollar extends post-Fed weakness against most FX majors as bond yields ease and stocks rally on dovish take of the policy projections. Global stock market strength as Japan’s Nikkei rallies to a record high, Kospi surges more than 2% and the Hang Seng jumps more than 1.5%. All eleven S&P sectors are higher to start the trading day, adding to Wednesday gains with the biggest YTD winners Communications (XLC) +12%, Financials (XLF) +11%, Energy (XLE) +10% and near 10% YTD gains for Tech (XLK) and Industrials (XLI). All is well for now after Fed Chair Jerome Powell said yesterday his outlook for inflation to continue declining hadn’t changed substantially in recent weeks and the projections released Wednesday were little changed from December and showed most of his colleagues expect two or three cuts this year. Lots of end of month and quarter stock chasing most likely with the S&P on track for its 4th straight day of solid gains. We now await the opening of today’s big IPO, Reddit (RDDT) which priced at the high end of $31-$34 range in 22M share offering.

Economic Data

  • Weekly Jobless Claims fell to 210,000 in latest week from 212,000 and below consensus 215,000 as the 4-week moving average climbed to 211,250 from 208,750 prior week and continued claims climbed to 1.807M from 1.803M prior week; the U.S insured unemployment rate unchanged at 1.2%.
  • The U.S. Q4 current account balance was (-$194.8B) vs. consensus (-$-209.0B) vs Q3 balance (-$196.4B).
  • March Philadelphia Fed factory index higher at 3.2 vs. est. -2.5; while the prices-paid index fell to 3.7 vs 16.6 prior, the new orders index at 5.4 above prior -5.2 and Fed future index at 38.6 vs 7.2.
  • S&P Global March flash composite PMI at 52.2 (vs 52.5 in February) while S&P Global March flash services PMI at 51.7 (vs 52.3 in February).
  • Existing Home Sales for Feb much stronger rising 9.5% M/M at 4.38M unit rate (vs. est. 3.94M) and above Jan 4.00M; Feb inventory of homes for sale 1.070M units, 2.9 months’ worth; median home price for existing homes $384,500, +5.7% from Feb 2023.






WTI Crude















10-Year Note




Sector Movers Today

  • Semiconductors surge: MU lifted the semi sector after reported FQ2 results and provided FQ3 guidance, both above expectations, as pricing for both DRAM (+high teens) and NAND (+30%+) increased robustly; MU cited an improvement in traditional server demand, while AI server strength remained robust. AVGO upgraded Market Perform to Outperform at TD Cowen and raise tgt to $1,500 from $1,400 after attending the company’s "Enabling AI Infrastructure" event in San Jose, based on potential upside from both custom silicon and back-end AI networking; potential upside to revenue & OpEx synergies as VMWare is integrated; and a consensus outlook that already acknowledges cyclicality in non-AI semis verticals. ALAB extends rally after IPO priced the day prior at $36. INDI announces strategic investment in AI processor leader Expedera; terms not disclosed.
  • In Restaurants: DRI authorizes new $1B share buyback program; forecasts FY comp sales +1.5% to +2%, below prior forecast of +2.5% to +3%; also lowers FY sales forecasts to $11.4B from prior $11.5B and est. $11.51B; PZZA announced CEO transition as Rob Lynch (moves to PZZA) will be replaced by Ravi Thanawala and reaffirms its FY24 adj operating income and development outlook. SHAK named Rob Lynch as new CEO while Randy Garutti supports transition and remains advisor thru 2024.
  • In Tankers/Shipping: Jefferies upgraded FRO from Hold to Buy and raise tgt to $30 from $22 noting Frontline is one of the largest crude tanker operators in the world with a young fleet and high scrubber exposure and firm sees stronger dynamics ahead for tankers, especially with growing non-OPEC production volumes. DHT was upgraded from Hold to Buy as well with $14 tgt from $11 calling it a pure-play VLCC shipowner with exposure to the spot market, with its eco-design and scrubber-equipped vessels positioned for outsized earnings potential.



  • ALAB +15%; more than double now off yesterday IPO pricing of $36, trading above $74.
  • AMTX +17%; after saying the federal government has approved a $200 million EB-5 cash-for-visa program for multiple projects.
  • ARGX +14% and IMVT +7% as shares jumped after Chugai (CHGCF) said that Enspryng, its Roche (RHHBY)-partnered experimental therapy for the autoimmune disorder generalized myasthenia gravis, fell short of expectations in a Phase 3 trial.
  • GES +21%; Q4 results topped estimates with adj EPS $2.01 vs est. $1.56 on revs $891Mm vs est. $855.5Mm while operating margin rose 3.6% to 16.3%, from 12.7% last year, and approved $2.25 special dividend.
  • MU +14%; reported FQ2 results and provided FQ3 guidance, both above expectations, as pricing for both DRAM (+high teens) and NAND (+30%+) increased robustly; MU cited an improvement in traditional server demand, while AI server strength remained robust (shares of WDC jump in sympathy).



  • AAPL -1%; as Bloomberg reported the Justice Department set to sue Apple for alleged antitrust violations over iPhone access restrictions.
  • ACN -6%; shares stumbled as reported top and bottom line beat for Q2 but lowers FY24 revenue view to 1%-3% in local currency from 2%-5% in local currency vs. consensus $66.18B; forecasts Q3 revs $16.25B-$16.85B, below est. $17.03B (narrowed year EPS outlook).
  • ASO -6%; Q4 adj EPS $2.21 misses $2.29 estimate as sales $1.79B also just misses the $1.8B estimate and guides lower as sees 2025 net sales $6.07B-$6.35B (est. $6.36B) and forecasts 2025 comps -4% to +1%, below est. +0.94%.
  • CHWY -5%; reported Q4 rev/EBITDA of $2.83B/$86M vs Street at $2.79B/$65M while active customers of 20.1M declined 1.5% YoY (-170k QoQ); Q1 rev guide of $2.84-$2.86B was below Street’s $2.98B estimate and suggests approximately 2.3% growth at the midpoint.
  • DRI -6%; after forecasts FY comp sales +1.5% to +2%, below prior forecast of +2.5% to +3%; also lowers FY sales forecasts to $11.4B from prior $11.5B and est. $11.51B.
  • FIVE -12%; Q4 results fell short due to shrink, with an outlook below expectations (guides Q1 net sales $826-846Mm vs est. $851.96Mm and EPS $0.58-0.69 vs est. $0.76 on lower year outlook).
  • LI -6%; shares slip after saying expects deliveries in the first three months of the year of between 76,000 and 78,000 vehicles, down from their previous outlook for between 100,000 and 103,000.
  • PARA -4%; after CNBC’s David Faber said that a potential sale of Paramount studios to Apollo Global (APO) is unlikely to happen. Paramount is not seen selling the studio separately, according to a report CNBC’s David Faber, who cited people familiar https://tinyurl.com/yck652hv
  • TITN -7%; following quarterly results and guidance.


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.