Morning Preview: March 30, 2023

Early Look
Thursday, March 30, 2023
Futures |
Up/Down |
% |
Last |
Dow |
185.00 |
0.56% |
33,088 |
S&P 500 |
21.25 |
0.53% |
4,079 |
Nasdaq |
60.50 |
0.46% |
13,025 |
S&P futures (Spuz) on the upswing yet again, rising +0.54% to 4,079, near its overnight highs and its best levels since March 6th (4,082.50), topping its 50-day moving average technical resistance level in the process. Wall Street ended sharply higher on Wednesday, with Micron Technology (MU) driving optimism about a recovery in semiconductor sales (despite posting an awful quarter and guidance) and helping ease worries about weakness in the banking system. Right now, markets are in full all out “risk mode” as “no news” is “good news”. Since the bank failures of SIVB and SBNY two weeks ago, there have been no other “shoes that have dropped” in the banking system. At the same time, the Fed boosted rates another 25-bps last week, but markets are pricing in that it could be the last hike before cuts follow. The Fed has of course said the opposite, that inflation remains the number one target, but stock markets have not listened to this point. We will get a better picture with Q4 GDP this morning at 8:30 along with jobless claims and a handful of inflation reports – but tomorrows core PCE data is the Fed key inflation metric, and all eyes will be fixed on that. The Nasdaq 100 rises 20% from December low to enter bull market, as technology, communications, and consumer discretionary have paced the gains in 2023, heading into quarter end tomorrow. In Asian markets, The Nikkei Index fell -100 points to 27,782, the Shanghai Index rose 21 points to 3,261, and the Hang Seng Index gains 116 points to 20,309. In Europe, the German DAX gains 165 points to 15,493, while the FTSE 100 rises 57 points to 7,621.
Economic Calendar for Today
· 8:30 AM ET Weekly Jobless Claims…est. 196K
· 8:30 AM ET Continuing Claims…est. 1.697M
· 8:30 AM ET Gross Domestic Product (GDP) for Q4-Final…est. +2.7%
· 8:30 AM ET GDP Price Deflator for Q4-Final…est. +3.9%
· 8:30 AM ET Consumer Spending for Q4-Final…prior 1.4%
· 8:30 AM ET PCE Prices for Q4-Final
· 8:30 AM ET Core PCE Prices for Q4-final…est. +4.3%
· 10:30 AM ET Weekly EIA Natural Gas Inventory Data
· 12:45 PM ET Fed’s Barkin Speaks at Virginia Council of CEOs Event.
Earnings Calendar:
· Earnings Before the Open: AMPS ANGO BCLI CRMD EVGO MKTW NEOG RMTI SNDA
· Earnings After the Close: ACRX AEHR BRZE CURI GAN GOEV NBY PLSE SIEN SKLZ SPRO SURG
Other Key Events:
· Enterprise Connect Conference & Expo, 3/27-3/30, in Orlando, FL
· Shop Talk Conference, 3/26-3/30, in Las Vegas
· Barclays Crypto Summit, 3/29-3/30, in Miami, FL.
· China NBS Manufacturing and Non-Manufacturing PMI for March
Market Closing Prices Yesterday
· The S&P 500 Index climbed 56.54 points, or 1.42%, to 4,027.81.
· The Dow Jones Industrial Average rose 323.35 points, or 1.00%, to 32,717.60.
· The Nasdaq Composite jumped 210.16 points, or 1.79%, to 11,926.24.
· The Russell 2000 Index advanced 18.97 points, or 1.08% to 1,71.60.
Macro |
Up/Down |
Last |
Nymex |
0.79 |
73.76 |
Brent |
0.62 |
78.90 |
Gold |
2.50 |
1,987.00 |
EUR/USD |
0.0038 |
1.0881 |
JPY/USD |
-0.30 |
132.54 |
10-Year Note |
+0.002 |
3.568% |
World News
· The bull-bear spread in the American Association of Individual Investors (AAII) weekly survey was -23.1 vs -28 last week. Bulls rise to 22.5% from 20.9%, Neutrals rise to 31.9% from 30.2%, Bears fall to 45.6% from 48.9%.
· The Federal Reserve’s top bank regulator on Wednesday said that supervisors could have done more to keep tabs on Silicon Valley Bank before it collapsed earlier this month.
Sector News Breakdown
Consumer
· RH Corp. (RH) 4Q adj EPS $2.88 vs est. $3.34 on revs $772.5Mm vs est. $779.8Mm, adj op mgn 16.6%; sees 1q net rev. $720M-$735M, below est. $828.3M; sees FY net revs $2.9B-$3.1B also below consensus of $3.48B
· Tesla Inc (TSLA) has missed its solar-roof installation targets by a massive margin due to stiff competition from GAF Energy and other rivals, according to industry analysis firm Wood Mackenzie. Tesla’s average installations per week were just 21 in 2022 and its best quarter saw 32 systems installed per week, lower than the company’s 1,000-per-week target for 2021.
· Philip Morris (PM) upgraded to overweight from neutral at JPMorgan; top pick in tobacco.
Energy, Industrials and Materials
· BTU Corp. (BTU) confirmed a fire that began earlier today at its Shoal Creek Mine in Alabama involving void fill material utilized to stabilize the roof structure of the mine. All mine personnel have now been safely evacuated from the mine.
· Crane Holdings Co. (CR) will join the S&P MidCap 400, effective prior to the open of trading on April 4, replacing PACW which is moving to the S&P SmallCap 600 index.
· HB Fuller (FUL) 1Q adj EPS $0.55 vs est. $0.59 on revs $809Mm vs est. $825.4Mm, adj EBITDA $110Mm vs est. $110Mm; guides FY adj EBITDA $580-610Mm vs est. $584.7Mm and adj EPS $4.10-4.50 vs est. $4.25.
· Planet Labs (PL) 4Q adj EPS ($0.08) vs est. ($0.16) on revs $53Mm vs est. $52.6Mm, adj gr mgn 58%; guides 1Q revs $51-54Mm vs est. $57.3Mm, adj gr mgn 53-55%, adj EBITDA ($21)Mm-($18)Mm vs est. ($15.2)Mm; sees FY revs $248-268Mm vs est. $259Mm, adj gr mgn 57-61%, adj EBIDA ($47)Mm-($37)Mm.
· Southern Copper (SCCO) downgraded to Equal Weight from Overweight at Morgan Stanley.
Financials
· Citizens Financial (CFG): Massachusetts securities regulators said they are investigating a unit of Citizens Financial Group Inc. over its sales of a savings product offered by an insurer controlled by now-indicted financier Greg Lindberg, the WSJ reported.
· LendingTree Inc. (TREE) said that it would cut around 13% of its workforce to lower costs; said it expected to record roughly $5.6 million in severance charges.
· PacWest Bancorp (PACW) will be moved to the S&P SmallCap 600 from the S&P MidCap 400, effective prior to the open of trading on April 5, to replace Nektar Therapeutics (NKTR), which will no longer be part of S&P Dow Jones Indices.
· Charles Schwab (SCHW) downgraded to equal-weight from overweight at Morgan Stanley, saying that Schwab’s clients are pulling cash out of the firm’s low- interest-rate bank accounts at twice the rate that MS expected.
Healthcare
· Akero Therapeutics Inc (AKRO) said it had a positive meeting with the FDA for experimental drug efruxifermin and has aligned with the agency on key features of its late-stage program.
· Avadel Pharmaceuticals (AVDL) 10M share Spot Secondary priced at $8.50.
· Biomea Fusion (BMEA) 5M share Secondary priced at $30.00.
· Bolt Biotherapeutics Inc (BOLT) said an early-stage dose-escalation study of its experimental cancer therapy, BDC-1001, in combo with BMY’S Opdivo, showed anti-tumor activity in the form of multiple partial responses and tumor shrinkage, among others.
· Oak Street Health, Inc. (OSH) cancelled its 2023 Annual Meeting of Stockholders scheduled for Thursday, April 27, 2023, at 8:30 A.M., following the previously announced definitive agreement under which CVS Health (CVS) will acquire Oak Street Health in an all-cash transaction at $39.00 per share, representing an enterprise value of approximately $10.6 billion.
· Viking Therapeutics (VKYX) 17.242M share Spot Secondary priced at $14.50.
Technology, Media & Telecom
· Electronic Arts (EA) announced it plans to slash 6% of its workforce as the videogame publisher looks to cut costs.
· Roku Inc (ROKU) announces restructuring to impact approximately 200 employees or about 6% of its staff; estimates that it will incur non-recurring charges of about $30M-$35M in connection with plan; implementation of headcount reductions, including cash payments, will be substantially complete by end of q2 of fiscal 2023
· Semtech Corp. (SMTC) 4Q adj EPS $0.47 vs est. $0.48 on revs $152.5Mm vs est. $150.1Mm, adj gr mgn 62.3%, adj op mgn 22.5%; guides 1Q net sales $230-240Mm, adj gr mgn 47.5-49.5%, adj EPS ($0.11)-($0.04).
· Sprinkler (CXM) Q4 revs $165.3M vs. est. $162.8M; sees total GY revs $710M-$714Mvs. analysts’ est. of $710M; guided year EPS $0.13-$0.15 vs. est. $0.10.
· Concentrix Corporation (CNXC) announced they have entered into an agreement to combine with Webhelp in a transaction valued at approximately $4.8 billion, including net debt.
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.