Early Look

Thursday, June 24, 2021

Futures	Up/Down	%	Last
Dow	188.00	0.56%	33,947
S&P 500	20.25	0.49%	4,252
Nasdaq	77.75	0.55%	14,340

 

 

Another day, another apparent all-time high in store for the Nasdaq Composite which is looking to close at a record for a third day, while Dow and S&P futures also point higher after a late day slide Wednesday snapped modest 2-day winning streaks for each. The 10-year yield is flattish around the 1.49% level, holding steadily below 1.5% over the last week despite higher rate projections from the Fed – though Fed Chair Powell and other Fed members have downplayed the outlook. Tonight, we get the latest round of bank stress tests as well as earnings from Dow component Nike (NKE) and package-delivery giant Fed-Ex (FDX) which is a good barometer for the U.S. economy. This morning, a busy round of economic data including weekly jobless claims, as well as Q1 final GDP (est.+6.4%) and several inflation expectations (PCE). The Fed has continued to express zero fear about the current surge in global prices, calling the inflation temporary, so even a hotter reading could fail to move the needle. In Asian markets, The Nikkei Index finished little changed at 28,875, the Shanghai Index also unchanged at 3,566 while the Hang Seng Index edged higher by 65 points to 28,882. In Europe, the German DAX is higher by 125 points to 15,580, while the FTSE 100 rises over 20 points to around the 7,100 level.

Events Calendar for Today

·     8:30 AM ET         Gross Domestic Product (GDP) Q1-F…est. 6.4%

·     8:30 AM ET         GDP Deflator, Q1-F…est. 4.3%

·     8:30 AM ET         Consumer Spending, Q1-F…est.

·     8:30 AM ET         PCE Prices Q1-Final…est. 3.7%

·     8:30 AM ET         Core PCE Prices, Q1-Final…est. 2.5%

·     8:30 AM ET         Advance Goods Trade Balance for May…prior (-$85.73B)

·     8:30 AM ET         Weekly Jobless Claims…est. 380K

·     8:30 AM EST      Continuing Claims…est. 3.47M

·     8:30 AM EST      Durable Goods Orders MoM for May…est. 2.8%

·     8:30 AM EST      Durable Goods Ex: Autos MoM for May…est. 0.8%

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

·     11:00 AM ET      Kansas City Manufacturing for June

 

Earnings Calendar:

·     Earnings Before the Open: DRI, GMS, MEI, RAD, WOR

·     Earnings After the Close: CAMP, FDX, NKE, PRGS, SNX

 

Other Key Events:

·     U.S. Federal Reserve to release 2021 bank stress test results at 4:30 PM

·     JPMorgan Payment & FinTech Forum (virtual), 6/23-6/24

·     Sidoti Investor Conference (virtual), 6/23-6/24

 

Market Closing Prices Yesterday

·     The S&P 500 Index slipped -4.60 points, or 0.11%, to 4,241.84

·     The Dow Jones Industrial Average fell -71.34 points, or 0.21%, to 33,874.24

·     The Nasdaq Composite climbed 18.46 points, or 0.13%, to 14,271.73

·     The Russell 2000 Index advanced 7.52 points, or 0.33% to 2,303.47

 

 

Macro	Up/Down	Last
Nymex	0.07	73.15
Brent	0.10	75.29
Gold	3.30	1,782.00
EUR/USD	0.0019	1.1945
JPY/USD	-0.13	110.83
10-Year Note	-0.006	1.491%

 

 

Sector News Breakdown

Consumer

·     KB Homes (KBH) Q1 adj EPS $1.50 vs. est. $1.32; Q2 revs $1.44B vs. est. $1.5B; qtrly homes delivered rose 40% to 3,504; qtrly ending backlog grew 98% to 10,034 homes; net orders for qtr grew 145% to 4,300, with net order value increasing by $1.35 bln, or 196%, to $2.04 bln; inventories as of May 31, 2021 increased 10% vs Nov 30,2020 to $4.27 bln; raises FY21 housing revenue view to $5.9B-$6.1B from $5.7B-$6.1B; raises FY21 average selling price to $415,000-$425,000 from $405,000-$415,000

·     Magna (MGA) upgraded to Buy from Neutral at Goldman Sachs and tgt raised to $120 from $97

·     Steelcase (SCS) 1Q EPS ($0.24) vs. est. ($0.31) on revs $556.6Mm vs. est. $554.9Mm; guides 2Q EPS $0.25-0.30 vs. est. $0.22, sees 2Q revs $750-780Mm vs. est. $704.3Mm; says for 2H continues to target dbl-digit revs growth with price increases beginning to offset significant inflationary pressure later in the year

·     Tesla (TSLA) CEO Elon Musk said late yesterday he would list SpaceX’s space internet venture, Starlink, when its cash flow is reasonably predictable

·     OneSpaWorld (OSW) 8.42M share Spot Secondary priced at $9.50

 

Energy, Industrials and Materials

·     Daqo New Energy (DQ) and JinkoSolar (JKS) shares fell after hours after Bloomberg reported that the U.S. is poised to bar some solar products made in China’s Xinjiang region. Also, the U.S. Commerce Department reportedly will add five Chinese entities to its export blacklist, including Xinjiang Daqo New Energy

·     HB Fuller (FUL) Q2 adj EPS $0.94 vs. est. $0.92; Q2 revs $828M vs. est. $764.4M; adjusted gross margin 26.5% vs. 27.7% YoY; full year 2021 revenue growth is anticipated to be in low double-digits versus 2020; full year adjusted Ebitda in range of $455M-$475M remains unchanged; expects 2021 raw material cost increases to exceed 10% on a full year basis versus 2020

·     Intrepid (IPI) announces $90 Increase to Potash Price; $35 Increase to Trio® Price. Says in response to recent increases in the barge and inland warehouse potash markets, Intrepid increased its potash price by $90 per ton at all locations and for all product grades. Intrepid is now posted at $250 per ton above 2020 summer-fill price levels.

·     Worthington Industries (WOR) Q4 sales rose 60% to $978.3M on adj earnings of $2.33

·     Talos Energy (TALO) announces 5M share offering of common stock for holders

·     Saudi Arabia’s Energy Minister said the OPEC+ alliance has a role in containing inflationary pressures, just hours after Brent crude surged back above $75 a barrel

·     GMS Inc. (GMS) Q4 EPS $1.07 vs. est. $0.82; Q4 revs $932.2M vs. est. $858.9M

·     U.S. solar manufacturers have been rallying the last few days after legislation introduced this week by Sen. Jon Ossoff of Georgia would offer tax credits for individual parts of the solar manufacturing sector, providing support for each stage of the supply chain, including polysilicon, wafers, cells and modules. First Solar (FSLR), which plans to build a $680M panel factory in Ohio, and SunPower (SPWR) are seen as likely to benefit from increased U.S. demand for solar equipment as well as RUN, NOVA, ENPH and SEDG

 

Financials

·     AFC Gamma (AFCG) 2.75M share Secondary priced at $20.50

·     Broadstone Net Lease (BNL) 10M share Spot Secondary priced at $23.00

·     Visa (V) announced it has signed a definitive agreement to acquire Tink, a European open banking platform that enables financial institutions, fintech’s and merchants to build financial management tools, products and services for EUR 1.8B

·     Medical Properties Trust (MPW) announced that it has entered into definitive agreements to acquire for approximately $900M five general acute care hospitals from Tenet Healthcare (THC)

 

Healthcare

·     Applied Genetic (AGTC) to host conference call on June 24 at 8:00 am et to discuss achromatopsia 12-month data in its ongoing CNGB3 and CNGA3 phase 1/2 clinical trials

·     Arcus Biosciences (RCUS) said that a two-drug combination that includes an anti-TIGIT antibody delivered “encouraging clinical activity” following a preliminary look at a clinical trial of patients with lung cancer.

·     Eisai (ESALY) and Biogen Inc. (BIIB) announce U.S. FDA Grants breakthrough therapy designation for lecanemab (ban2401), an anti-amyloid beta protofibril antibody for the treatment of Alzheimer’s disease

·     Parexel, which is owned by private equity firm Pamplona Capital Management, has drawn interest from suitors that include other private equity groups as well as AmerisourceBergen, Bloomberg reported

·     Bright Health (BHG) 51.35M share IPO priced at $18.00

·     Monte Rosa Therapeutics (GLUE) 11.7M share IPO priced at $19.00

·     The U.S. will send 3M doses of the Johnson & Johnson’s (JNJ) one-shot COVID-19 vaccine to Brazil

 

Technology, Media & Telecom

·     Microsoft (MSFT) will officially unveil the next version of Windows on Thursday at 11 a.m. ET. With appearances by CEO Nadella and chief product officer Panos Panay, the event will offer consumers and businesses their first official look at what is expected to be called Windows 11.

·     Confluent (CFLT) 23M share IPO priced at $36.00

·     Doximity (DOCS) 23.3M share IPO priced at $26.00

·     Concentrix (CNXC) 2Q adj EPS $2.37 vs. est. $2.27 on revs $1.37B vs. est. $1.36B; guides 3Q revs $1.35-1.4B vs. est. $1.36B and non-GAAP operating income is expected to be in the range of $160M to $174M

·     Nokia (NOK) launches next-generation AirScale 5G portfolio powered by ReefShark technology