Early Look

Monday, November 20, 2023

Stocks futures barely moving with the S&P at 4,529, holding in a 14-point range overnight (4,534 high below last Friday 4,539.50 best level and low of 4,520, above last Friday low 4,512.75) ahead of this holiday shortened week. The dollar index (DXY) adds to last week 1.6% losses, down -0.3% to 103.60, its lowest level since August while the USD/JPY falls -0.9% to 148.24. Treasury yields edge higher with the 10-yr +3 bps to 4.47%. A quiet week somewhat expected given the Thanksgiving Day holiday on Thursday and early market close on Friday (1:00 PM), but there are a still a few potential market catalysts including NVIDIA (NVDA) earnings on Tuesday night. Stocks looking to continue their winning ways after the S&P 500 rose 2.24% last week, the Dow industrials gained 1.94%, the Nasdaq climbed 2.37%, the 3^rd straight weekly rise for all three and the Russell 2000 gained over 5.3%. The S&P 500, with its gains on Friday, are now up 13 of the last 15 trading sessions heading into a seasonally strong part of the year for U.S. stocks. Crude oil entered a bear market last week after falling more than 20% from its September high, but prices are rebounding this morning. In Asian markets, The Nikkei Index declined -197 points to 33,338, the Shanghai Index rose 13 points to 3,068, and the Hang Seng Index gained 323 points to 17,778. In Europe, the German DAX is down 40 points to 15,878, while the FTSE 100 slips a few points to 7,500. In Emerging markets, Argentina stocks spike after right-wing Javier Milei wins Argentina’s presidential election, putting an outsider in charge to fix South America’s #2 economy battered by triple-digit inflation.

Market Closing Prices Yesterday

·     The S&P 500 Index gained 5.79 points, or 0.13%, to 4,514.03.

·     The Dow Jones Industrial Average rose 1.81 points, or 0.01%, to 34,947.28.

·     The Nasdaq Composite climbed 11.81 points, or 0.08%, to 14,125.48.

·     The Russell 2000 Index advanced 24.01 points, or 1.35% to 1,797.77.

Economic Calendar for Today

·     10:00 AM ET                Leading Index M/M for October

Earnings Calendar:

·     Earnings Before the Open: LEGN POL

·     Earnings After the Close: A BMTX BRBR CENT ENTA GBDC KEYS PRST SYM TPST XELB ZM

Other Key Events:

·     Needham 3rd Annual Consumer Tech / E-Commerce Conference (virtual), 11/20

World News

·     Jim Chanos is shutting down hedge funds he manages that wager against companies he believes are overpriced or fraudulent. “The marketplace for what I do has changed,” Chanos, 65, told The Wall Street Journal. He expects to return most of his investors’ cash by Dec. 31. His firm, Chanos & Co., manages less than $200 million today, down from $6 billion in 2008, and its funds are down 4% so far this year, while the S&P 500 is up 19% – WSJ https://tinyurl.com/52uhj8w8

·     Israel said it was entering the “next stage” of the six-week-old war against Hamas as focus shifted to the south of the besieged Gaza Strip. Separately, Israeli paratroopers raided what were called the homes of senior Hamas officials in northern Gaza – Bloomberg.

·     Moody’s affirms Italy at BAA3, changed outlook to stable from negative; change reflects stabilization of prospects for Italy’s economic strength, health of banking sector and govt’s debt dynamics.

Sector News Breakdown

Consumer

·     KB Home (KBH) downgraded to Neutral from Outperform at Wedbush.

·     Spectrum Brands (SPB) downgraded to Equal Weight from Overweight at Wells Fargo.

Energy, Industrials and Materials

·     Boeing (BA) upgraded to Buy from Hold at Deutsche Bank with $270 tgt.

·     Ryan Specialty Group (RYAN) downgraded to Neutral from Buy at Goldman Sachs.

·     Vale (VALE) upgraded to Buy from Neutral at Bank America with $20 tgt.

Financials

·     Argentina banks Banco Bbva Argentina (BBAR) and Grupo Financiero Galicia (GGAL) among US listed Argentina stocks after right-wing Javier Milei wins Argentina’s presidential election.

·     Citigroup (C) employees expect the bank to announce layoffs and senior management changes on Monday as part of its biggest reorganization in decades, according to five sources with knowledge of the matter – Reuters reported.

Healthcare

·     10x Genomics Inc. (TXG) won a unanimous verdict in a patent infringement case against GeoMx products from NanoString Technologies Inc. (NSTG).

·     Bayer (BAYRY) said it stopped a late-stage trial testing a new anti-clotting drug, asundexian, which was shown to be inferior to BMY and Pfizer’s (PFE) established anticoagulant Eliquis in preventing strokes in patients with atrial fibrillation which is irregular heart rhythm.

·     Medtronic Plc (MDT) said the FDA has approved the company’s Symplicity Spyral renal denervation system, also known as the Symplicity blood pressure procedure, for the treatment of hypertension.

·     Masimo Corp. (MASI) said its W1 medical watch has received an FDA 510(k) clearance for over the counter (OTC) and prescription use.

·     Oscar Health (OSCR) announced that an affiliate of Deerfield Management Company, L.P. and the Anahata Foundation will purchase an aggregate of 3M shares of Common Stock and Anahata will purchase an aggregate of 2M shares of Common Stock.

Technology, Media & Telecom

·     Microsoft (MSFT) has hired ousted OpenAI CEO Sam Altman and former OpenAI president Greg Brockman to lead a new research unit, CEO Satya Nadella announced late Sunday night. Microsoft has been OpenAI’s largest investor and partner and has used its products to form the core of its Copilot products.

·     Intel Corp. (INTC) mentioned positively in Barron’s saying shares offer potential for gains as the company expands its third-party chip-manufacturing business and its server business gears up to launch more key products.

·     Veon (VEON) raised its full-year EBITDA guidance, now expecting growth of between 18%-20%, the against 10%-14% guided previously; also expects FY sales to grow 18%-20%, against previous guidance of growth between 16%-19%.