Early Look

Thursday, December 10, 2020

Futures	Up/Down	%	Last
DJ Industrials	48.00	0.16%	30,014
S&P 500	3.50	0.10%	3,667
Nasdaq	-6.50	0.05%	12,358

 

 

U.S. stock futures are looking mixed with Nasdaq futures edging slightly lower after posting its worst day in over a month, while Dow and S&P futures are mildly higher as investors weighed dimming prospects for a coronavirus relief package, while expected vaccine approvals over the next week keep a floor under markets (and overshadow the surging coronavirus cases and state and country wide restrictions). Stocks fell Wednesday, led by a sharp decline in mega cap and big tech stocks as the Nasdaq Composite fell around 2% for its biggest one-day decline since the end of October (and off intraday record highs), as the Nasdaq 100 (QQQ) snapped its 11-day winning streak. The S&P 500 and Dow also finished lower, retreating from all-time highs early in the session. Tech weakness was overshadowed a strong day for IPOs, with DoorDash closing nearly double its offering price and cloud software company AI surging more than 100% in its debut ahead of AirBnB IPO today (which priced its 51M share IPO at $68 – above the $56-$60 range). Cyclicals managed gains, with Energy, Industrials, and Materials rising on vaccine hopes and an economic recovery. In Asian markets, The Nikkei Index fell -61 points to 26,756, the Shanghai Index edged slightly higher to 3,373 and the Hang Seng Index fell -92 points to 26,410. In Europe, the German DAX is little changed at 13,335, while the FTSE 100 is up over 20 points to 6,590. A busy morning of economic data with weekly jobless claims and consumer price index data due at 8:30 AM EST.

Market Closing Prices Yesterday

·     The S&P 500 Index dropped -29.43 points, or 0.79%, to 3,672.82

·     The Dow Jones Industrial Average fell -105.07 points, or 0.35%, to 30,068.81

·     The Nasdaq Composite plunged -243.82 points, or 1.94%, to 12,338.95

·     The Russell 2000 Index declined -15.63 points, or 0.82% to 1,902.15

 

Economic Calendar for Today

·     8:30 AM EST      Weekly Jobless Claims…est. 725K

·     8:30 AM EST      Continuing Claims…est. 5.335M

·     8:30 AM EST      Consumer Price Index (CPI) MoM for Nov…est. 0.1%

·     8:30 AM EST      CPI Ex: Food & Energy MoM for Nov…est. 0.1%

·     8:30 AM EST      Consumer Price Index (CPI) YoY for Nov…est. 1.1%

·     8:30 AM EST      CPI Ex: Food & Energy YoY for Nov…est. 1.6%

·     10:30 AM EST    Weekly EIA Natural Gas Inventory Data

 

Earnings Calendar:

·     Earnings Before the Open: ADBE, ASO, CBKC, CIEN, FLR, HOFT, LEE

·     Earnings After the Close: AVGO, COST, LAKE, MAX, MTN, NX, PHX, PLAY, SEAC, ZDGE

 

Other Key Events:

·     Baird Government & Defense Conference (1-day)

·     Truist Securities Gaming, Lodging, Leisure & Restaurants Summit (1-day)

 

 

Macro	Up/Down	Last
WTI Crude	0.66	46.18
Brent	0.76	49.62
Gold	-2.95	1,836.60
EUR/USD	0.0013	1.2094
JPY/USD	0.24	104.47
10-Year Note	-0.011	0.92%

 

 

Sector News Breakdown

Consumer

·     Airbnb (ABNB) priced its 51.3M share initial public offering (IPO) at $68.00, which is above the prior range of $56-$60, valuing Airbnb at $47B on a fully diluted basis

·     Starbucks (SBUX) sees adjusted EPS growth of 10%-12% for FY23, FY24

·     RH Inc. (RH) 3Q adj EPS $6.20 vs. est. $5.33; Q3 revs $844.8M (up 25% YoY) vs. est. $838.7M; 3Q adjusted gross margin 48.4% vs. 41.7% YoY; said sees meaningful revenue growth in restaurants, Contract business in 2021

·     Oxford Industries (OXM) 3Q adj EPS loss ($0.44) vs. est. ($1.10) on sales $175Mm vs. est. $164.4Mm; announced its decision to exit the Lanier Apparel business, which is expected to be complete in the second half of fiscal 2021; Full price e-commerce sales grew 51% in Q3 with growth in all the Company’s branded businesses; Gross margin was comparable YoY at 55%

 

Energy Industrials & Materials

·     Hydrofarm (HYFM) 8.67M share IPO priced at $20.00

·     Exelon (EXC) disclosed that Brookfield Renewable Partners (BEP) along with its institutional partners, agrees to buy Exelon Generation’s solar business for $810M

·     Greif (GEF) Q4 EPS 78c vs. est. 72c and Q4 revenue $1.16B vs. est. $1.17B; sees Q1 EPS 48c-58c below consensus 64c; said as of October 31, 2020, the company had $538.1M of available borrowing capacity within its $800.0M revolving credit facility

·     Southern Copper (SCCO) downgraded to Neutral from Buy at UBS after 39% year-to-date rally

 

Financials

·     CBOE Global Markets (CBOE), Nasdaq (NDAQ), InterContinental Exchange (ICE) – The SEC approved a plan to beef up the public data feeds that broadcast stock prices to investors, broadening access to market information that exchanges sell to professional traders at a premium. Under the SEC’s plan, detailed data showing supply and demand for stocks will be added to the public feeds, which are called securities information processors, or SIPs. Wall Street banks and electronic trading firms use such data to predict short-term price moves and ensure that they get good prices when buying or selling stocks – WSJ

·     Open Lending (LPRO) 9.5M share Secondary priced at $28.00

·     AllianceBernstein L.P. (AB) announced that preliminary assets under management increased to $668 billion during November 2020 from $622 billion at the end of October. The 7.4% increase was due to market appreciation and firmwide net inflows

·     Franklin Resources, Inc. (BEN) reported preliminary month-end assets under management of $1,466.7 billion at November 30, 2020, compared to $1,391.6 billion at October 31, 2020.

·     Invesco Ltd. (IVZ) reported preliminary month-end assets under management (AUM) of $1,294.0 billion, an increase of 7.3% versus previous month-end. Total net inflows were $4.2 billion. The firm achieved net long-term inflows of $1.5 billion this month. Non-management fee earning net inflows were $1.2 billion and money market net inflows were $1.5 billion

·     NCino (NCNO) 3Q adj EPS ($0.03) vs. est. ($0.09) on revs $54.2Mm vs. est. $49.5Mm; guides 4Q revs $53-53.5Mm vs. est. $50.6Mm, sees 4Q adj EPS ($0.08) to ($0.09) vs. est. ($0.11)

·     Virtus Investment Partners (VRTS) preliminary total long-term assets under management of $124.5B at Nov. 30, 2020 increase from $115.2B at Oct. 31, 2020

 

Healthcare

·     ALX Oncology (ALXO) 2.38M share Secondary priced at $76.00

·     Rocket Pharmaceuticals (RCKT) 4.643M share Secondary priced at $56.00

·     Biogen (BIIB) has submitted a Japanese New Drug Application (J-NDA) to the Ministry of Health, Labor and Welfare (MHLW) for aducanumab (BIIB037), an investigational therapy for Alzheimer’s disease.

·     Editas Medicine (EDIT) announced it submitted an Investigational New Drug, IND, application with the U.S. FDA, for the initiation of a Phase 1/2 clinical trial of EDIT-301, an experimental CRISPR/Cas12a gene editing medicine in development for the treatment of sickle cell disease

·     Immutep (IMMP) soared after reporting a statistically significant survival benefit in data from the ongoing Phase 2B AIPAC study evaluating its lead product candidate eftilagimod alpha in combination with paclitaxel chemotherapy in patients with metastatic breast cancer.

·     Laboratory Corporation of America’s (LH) Pixel by LabCorp COVID-19 Test Home Collection Kit granted Emergency Use Authorization by the FDA to become the first to be available over the counter without requiring a prescription.

·     Puma Biotechnology’s (PBYI) neratinib meaningful reduces risk of recurrence and improves survival in early-stage breast cancer patients after results from the Phase III ExteNET trial at the 2020 Virtual San Antonio Breast Cancer Symposium

·     G1 Therapeutics (GTHX) reported final data from its Phase 2 trial of trilaciclib in metastatic triple-negative breast cancer (mTNBC)

 

Technology, Media & Telecom

·     IAC Corp. (IAC) reported 14% Y/Y growth in total ANGI HomeServices revenue vs. 10% Y/Y growth in October. Vimeo total revenue Y/Y growth of 54%, DotDash and Search revenue Y/Y growth of 34% and 12% respectively

·     Apple (AAPL) and Google (GOOGL) to ban data broker with government ties – tech giants tell app developers to remove X-Mode Social trackers or lose access to app store – X-Mode has come under scrutiny over its national security work for defense contractors – per Dow Jones

·     Comtech Telecom (CMTL) Q1 adj EPS 15c vs. est. loss ($1.78); Q1 revenue $135.2M vs. est. $124.91M; backs FY21 revenue view $610M-$630M vs. est. $618.34M; sees FY21 adjusted EBITDA $74M-$76M vs. prior $74M-$78M

·     HP Inc. (HPQ) files $5B mixed securities shelf

·     Ichor Holdings (ICHR) 4M share Secondary priced at $31.75

·     Sea Limited (SE) proposes to offer 11M American Depositary Shares

·     Taiwan Semiconductor (TSM) achieved record revenue growth of 5% Q/Q and 15.7% Y/Y to ~NT$124.87B for the month of November.

·     Verint Systems (VRNT) 3Q adj EPS $1.02 vs. est. $0.80 on revs $328Mm vs. est. $317.1Mm; guides FY adj EPS $3.40 vs. est. $3.37, sees FY revs $1.28B vs. est. $1.27B; separation plan on track