Early Look

Friday, July 2, 2021

Stocks are generally flat in pre-market trading as the S&P seeks to hit a new record intraday high and close every day this week. Yesterday’s high was 4,312 and it appears the index is on track to open right around that level. However, things can quickly change after the nonfarm payrolls jobs report at 8:30. Economists are estimating that around 700,000 new jobs were created in June, though the consensus view was too optimistic for each of the past 2 months. However, monthly private payrolls and weekly jobless claims were both better than expected this week. In other news, yesterday’s OPEC+ meeting was extended to today, and reports said that the UAE blocked an agreement to raise supply by 400k bpd from August-September at the last minute. If the group cannot come to an agreement, current production levels will remain stable, likely leading to higher prices in the face of higher demand. Oil prices are slightly lower than yesterday when it hit its highest price since October 2018. In Asian markets, The Nikkei Index is higher by 76 points, the Shanghai Index is down 70 points, and the Hang Seng Index is sliding 575 points. In Europe, the German DAX is up 58 points, while the FTSE 100 has inched higher 6 points.

Market Closing Prices Yesterday

The S&P 500 Index rose 22.31 points, or 0.52%, to 4,319

The Dow Jones Industrial Average gained 130.76 points, or 0.38%, to 34,633

The Nasdaq Composite advanced 18.42 points, or 0.13%, to 14,522

The Russell 2000 Index climbed 18.80 points, or 0.81% to 2,329

Events Calendar for Today

·      8:30 AM ET                 Nonfarm Payrolls for June

·      8:30 AM ET                 Private Payrolls for June

·      8:30 AM ET                 Manufacturing Payrolls for June

·      8:30 AM ET                 Unemployment Rate for June

·      8:30 AM ET                 Average Hourly Earnings for June

·      8:30 AM ET                 International Trade for May

·      10:00 AM ET               Factory Orders MoM for May

·      1:00 PM EST                Baker Hughes Weekly rig count data

Sector News Breakdown

Consumer

Bespoke Capital Acquisition Corp (VWE) new Buy at Citi

Thor Industries (THO) new Underperform, Winnebago (WGO) new Market Perform, Camping World (CWH) new Outperform with a $45 at Raymond James

BMY (BMWYY) brand unit sales rose 89.5% Y/Y to 96,561 units in Q2 and increased 15% vs. 2Q19; North America Q2 sales 105,901 (+89.5%); total brand sales for the 1H are +52.2% YoY, +8.9% vs 2019

Li Auto (LI) delivered 7,713 Li ONE vehicles in June (+320.6% YoY) and total Q2 deliveries 17,575 (+166.1%) exceeded the top end of its guidance range

Energy, Industrials & Materials

Werner Enterprises (WERN) buys 80% of ECM Transport Group for $142.4M

Virgin Galactic (SPCE) announced its next flight will be July 11 and founder Richard Branson will be on board. This is 11 days before Blue Origin’s scheduled 7/20 flight that will include Jeff Bezos

Financials

Horace Mann Educators (HMN) raised 2021 EPS guidance to $3.50-$3.70 vs est. $3.30 from $3-$3.20 largely on strength of net investment income and impact of lower-than-guided catastrophe losses in second quarter; now expect catastrophe losses for just-ended Q2 will be about $15M-$18M, revised FY 2021 guidance assumes total net investment income to increase to range of $385M-$405M due to Q2 results

Bank OZK (OZK) raised its quarterly dividend to 28.5c/share from 28c

Baird assumed coverage on National Storage (NSA) at Outperform with a $54 price target

Healthcare

Biosig Technologies (BSGM) announced public offering

Stephens initiated OW ratings on Healthequity (HQY) with a $100 target and CloudMD Software & Services (DOCRF) with a $5 target

Merck (MRK) plans to withdraw the US accelerated approval indication for Keytruda for patients with recurrent locally advanced or metastatic gastric cancer as a third-line treatment after the drug failed to meet its post-marketing requirement of showing an overall survival benefit in a late-stage study. Merck said it plans the pullout in six months and does not affect other indications for Keytruda.

Technology, Media & Telecom

Chicken Soup for the Soul Entertainment (CSSE) intends to offer stock

Verizon (VZ) told federal regulators it would keep supporting low-cost wireless service for three years if it is allowed to buy TracFone as negotiations continue with the FCC to close the $6.9B acquisition

ContextLogic (WISH) downgraded to In-Line at Evercore