Morning Preview: May 18, 2023

Early Look

Thursday, May 18, 2023









S&P 500










U.S. futures are looking modestly higher, gaining traction after rising more than 1% across the board on Wednesday as markets continue to display confidence a debt-ceiling deal can be reached. Yesterday’s broad-based rally was led by lagging Energy stocks as well as Financials amid signs of easing stress in the regional banking sector and hopes the U.S. government can reach a debt-ceiling deal. Technology of course added to its year long rally, with the Nasdaq nearly up 20% YTD. A better-than-expected first quarter earnings season and indications from the Fed that it has paused its rate-hiking cycle after inflation last month fell to a two-year low have also helped support stocks of late. In Asian markets, The Nikkei Index jumped 480 points or 1.6% to settle at 30,573, the Shanghai Index rose 13 points to 3,297, and the Hang Seng Index climbed 166 points to 19,727. In Europe, the German DAX is up 255 points or 1.61% to 16,208, while the FTSE 100 rises 46 points to 7,769. Shares of Dow component Cisco (CSCO) slid overnight as reported a beat and raise quarter but also warned of an order decline last quarter. The S&P has remained in a 3,800-4.200 range for several months now, approaching the upper end of that band range now – will a debt deal put it over the top?


Market Closing Prices Yesterday

·     The S&P 500 Index climbed 48.91 points, or 1.19%, to 4,158.81.

·     The Dow Jones Industrial Average rose 409.09 points, or 1.24%, to 33,421.23.

·     The Nasdaq Composite jumped 157.51 points, or 1.28%, to 12,500.57.

·     The Russell 2000 Index advanced 38.31 points, or 2.21% to 1,774.50.


Economic Calendar for Today

·     8:30 AM ET           Weekly Jobless Claims…est. 254K

·     8:30 AM ET           Continuing Claims…est. 1.818M

·     8:30 AM ET           Philly Fed Business Survey for May…est. (-19.8)

·     10:00 AM ET         Existing Home Sales M/M for April…est. 4.3M

·     10:00 AM ET         Leading Index for April…est. (-0.6%)

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


Earnings Calendar:

·     Earnings Before the Open: BBWI BRC EXP MNRO WMT

·     Earnings After the Close: AMAT DXC FLOR ROST WMS


Other Key Events:

·     Deutsche Bank Solar & Clean Tech Conference, 5/18 (virtual)

·     Needham 18th Annual Technology & Media Conference, 5/16-5/18

·     RBC Capital Canadian Automotive, Industrials & Transportation Conference, 5/16-5/18





















10-Year Note





World News

·     The bull-bear spread in the American Association of Individual Investors (AAII) weekly survey was -16.8 vs -11.8 last week. Bulls fall to 22.9% from 29.4%, Neutrals rise to 37.4% from 29.4%, Bears fall to 39.7% from 41.2%


Sector News Breakdown


·     Bath & Body Works (BBWI) Q1 adj EPS $0.33 vs. est. $0.26; Q1 revs $1.4B vs. est. $1.4B; is still expecting fiscal 2023 sales to be flat to down in the mid-single digits but expects adjusted EPS to range from $2.68 to $3.08 (above prior view $2.50-$3.00) and vs. est. $2.94.

·     Boot Barn (BOOT) 4Q adj EPS $1.51 vs est. $1.44 on sales $425.7Mm vs est. $441.16Mm, same-store sales -5.5% (retail -3.3%, e-comm -18.4%); guides 1Q sales $357-364Mm vs est. $356.27Mm, comps -9% to -7% (retail -8% to -6%, e-comm -17% to -15%), gr mgn 35.7-36%, EPS $0.79-0.85 vs est. $1.17; sees FY sales $1.69-1.723B vs est. $1.626B, comps -6.5% to -4.5% (retail -7% to -5.2%, e-comm -3% to +1%), gr mgn 36.3-36.5%, EPS $4.70-5.00 vs est. $5.80.

·     Bowlero Corp. (BOWL) 3Q adj EBITDA $128Mm vs est. $114.95Mm on revs rose 22% y/y to $316Mm vs est. $300.51Mm.


Energy, Industrials & Materials

·     CenterPoint Energy (CNP) files automatic mixed securities shelf.

·     Canadian Solar (CSIQ) Q1 EPS $1.19 vs. est. $0.61; Q1 revs $1.7B vs. est. $1.71B; sees Q2 revenue $2.4B-$2.6B, consensus $2.31B and raises FY23 revenue view to $9B-$9.5B from $8.5B-$9.5B (vs. est. $9.22B) and reiterates its prior outlook for CSI Solar’s total module shipments to be in the range of 30 GW to 35 GW.

·     Eagle Materials (EXP) Q4 EPS $2.79 vs. est. $2.28; Q4 revs $470.1M vs. est. $455.38M.



·     Dlocal Ltd (DLO) posted a 35% jump in Q1 profit compared to a year earlier at $35.5M; said, as total payments volumes grew 70% y/y to reach record levels; Q1 revs rose 57% to $137M in line with the company’s forecast $135M-$138M.

·     Futu Holdings (FUTU) to Neutral from Overweight at JPMorgan and cut tgt to $46 from $65, after the company announced its decision remove the Futubull app from app stores in Mainland China from May 19.

·     Robinhood (HOOD) April monthly operating data: Net cumulative funded accounts at the end of April were 23.1M, up approximately 30,000 from March. Monthly active users (MAUs) at the end of April were 11.5M, down approximately 300,000 from March. Assets under custody at the end of April were $77.4B, down 1% from March. Net Deposits were $1.4B in April, translating to a 22% annualized growth rate relative to March AUC.



·     Bausch Health Cos. Inc. (BHC) shares rose 24% on Wednesday after a U.S. district court stuck with an earlier judgment that prevented an application for a rival generic version of its Xifaxan irritable bowel syndrome drug from getting FDA approval until 2029.

·     10x Genomics, Inc. (TXG) announced that it has won an injunction in its patent litigation against NanoString Technologies, Inc. (NSTG) and NanoString Technologies Germany GmbH.


Technology, Media & Telecom

·     Cisco Systems (CSCO) Q3 adj EPS $1.00 vs. est. $0.97; Q3 revs $14.6B vs. est. $14.39B; sees Q4 adj EPS $1.05-$1.07 above consensus $1.04 and Q4 rev growth 14%-16% y/y vs. est. $14.96B; boosts year EPS view to $3.80-$3.82 from $3.73-$3.78 and revs to 10%-10.5% from 9%-10.5% growth; shares fell after saying that orders declined in the past quarter.

·     New Relic (NEWR) shares rose late Thursday after the WSJ reported Private-equity firms Francisco Partners and TPG are working together on a $5 billion-plus bid to acquire the software company, according to people familiar with the matter.

·     Synopsis (SNPS) 2Q adj EPS $2.54 vs est. $2.46 on revs $1.395B vs est. $1.38B; guides 3Q revs $1.465-1.495B vs est. $1.484B, adj EPS $2.70-2.75 vs est. $2.70; guides FY revs $5.79-5.83B vs est. $5.813B, adj EPS $10.77-10.84 vs est. $10.58.

·     Take-Two Interactive (TTWO) 4Q adj EPS $0.59 vs est. $0.68 on revs $1.45B vs est. $1.339B, adj EBITDA $169.8Mm vs est. $208.4Mm, net bookings $1.39B vs est. $1.34B; guides FY24 net bookings $5.45-5.55B.

·     Netflix (NFLX) said six months after its launch, its ad-supported tier has nearly 5 million monthly active users globally.

·     Paramount (PARA) Chairwoman Shari Redstone bought $2.5 million of the company’s shares as the stock traded near a 52-week low, according to a Form 4 filing. She purchased 165,000 non-voting Class B shares at $15.06 in the open market Tuesday and now holds 577,064 shares.

·     Micron (MU) said it plans to invest up to 500-billion-yen ($3.70 billion) in extreme ultraviolet (EUV) technology over the next few years with support from the Japanese government.

·     Montana became the first state in the U.S. to enact a complete ban on TikTok on Wednesday when Republican Gov. Greg Gianforte signed a measure that’s more sweeping than any other state’s attempts to curtail the social media app. The measure is scheduled to take effect on January 1st, 2024.


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.