Morning Preview: October 03, 2023

Early Look

Tuesday, October 3, 2023









S&P 500










A surge in global Treasury yields continues, pressuring equities as the 10-year yield moves back to yesterday highs above 4.7% with investors prepped for a busy week of jobs related data. August JOLTs data is expected at 10:00 AM this morning, followed by ADP private payrolls Wednesday, weekly jobless claims Thursday and the Nonfarm payrolls reports Friday. A strong reading for jobs will only further add to the fear of additional fears to cool the economy. However, a sign of weaker jobs could soften yields and the U.S. dollar, which moved to fresh 10-month highs this morning (DXY above 107, euro back under 1.05). Stock news remains quiet heading into the start of earnings season in about 2-weeks. No new news on the Big Three auto strike in Detroit, oil and gold prices slip given the strength in the buck. Stocks finished mixed on Monday as the bond rout intensified, sending yields on 5- to 30-year Treasuries surging about 10 basis points. The selloff in global bonds gathered momentum as a budget deal averting a federal shutdown prompted traders to raise bets that the Federal Reserve will hike interest rates in November. Traders see a roughly one-in-three chance of a move, up from the 25% likelihood priced on Friday. In Asia, the Nikkei Index plunged -521 points to 31,237, the Shanghai Index remained closed (last 3,110), and the Hang Seng Index tumbled -478 points or 2.69% to 17,331. In Europe, the German DAX is down -55 points to 15,190, while the FTSE 100 is up 20 points to 7,532.


Market Closing Prices Yesterday

·     The S&P 500 Index edged higher 0.34 points, or 0.01%, to 4,288.39.

·     The Dow Jones Industrial Average fell -74.15 points, or 0.22%, to 33,433.35.

·     The Nasdaq Composite gained 88.45 points, or 0.67%, to 13,307.77.

·     The Russell 2000 Index declined -28.28 points, or 1.58% to 1,756.82.


Economic Calendar for Today

·     7:45 AM ET                  ICSC Weekly Retail Sales

·     8:00 AM ET                  Fed’s Bostic Speaks on Economic Outlook, Inflation

·     8:55 AM ET                  Johnson/Redbook Weekly Sales

·     10:00 AM ET                JOLTs Job Openings for August

·     10:25 AM ET                Fed’s Bowman Speaks at Community Banking Research Conference

·     4:30 PM ET                   API Weekly Inventory Data


Earnings Calendar:

·     Earnings Before the Open: MKC

·     Earnings After the Close: CALM


Other Key Events:

·     Chardan 7th Annual Genetic Medicines Conference, 10/2-10.3, in New York

·     Deutsche Bank 31st Annual Leveraged Finance Conference, 10/2-10/4, in Scottsdale, AZ

·     Mizuho 4th Annual REIT Conference 2023, 10/3-10/4, in New York

·     Roth MKM PV CellTech Conference, 10/3-10/4, in San Francisco, CA





















10-Year Note





Sector News Breakdown


·     American Outdoor Brands (AOUT) board of directors approves $10 million share repurchase program.

·     Brown-Forman (BFB) board approves share repurchase authorization of $400 million.

·     Oddity (ODD) CFO said their excellent third quarter performance and our momentum entering the fourth quarter give us confidence in our ability to deliver a strong finish to the year.

·     Turning Point Brands (TPB) files $500M mixed securities shelf.

·     McCormick (MKC) Q3 adj EPS $0.65 vs. est. $0.65; Q3 revs rose 6% y/y to $1.68B vs. est. $1.7B; reaffirmed its sales and operating profit outlook and increased its adjusted EPS view to $2.62-$2.67 from prior $2.60-$2.65; anticipates about $55 mln of special charges in 2023 relate to previously announced organizational and streamlining actions.


Energy, Industrials and Materials

·     In Chemicals: Lyondell (LYB), Dow (DOW) and Westlake (WLK) all upgraded to Sector Weight from Underweight at KeyBanc as expect 2024 volumes in their coverage to be much less affected by destocking, compared to 2023.

·     Chevron Corp. (CVX) is backing a startup by former SpaceX engineers to fast-charge electric vehicles without straining the power grid. The company’s investment in Electric Era Technologies is part of a Series A financing of $13 million led by HSBC Asset Management – Bloomberg

·     Booz Allen (BAH) upgraded to Buy from Neutral at Bank America and raised tgt to $130 from $110.

·     Emerson Electric (EMR) downgraded to Neutral from Buy at UBS.

·     Reynolds Consumer Products (REYN) upgraded to Neutral from Sell at Goldman Sachs.



·     Eli Lilly (LLY) to acquire all outstanding shares of POINT (PNT) for a purchase price of $12.50 per share in cash in a deal valued at about $1.4 billion payable at closing. The transaction has been approved by the board of directors of both companies.

·     ALX Oncology (ALXO) reports positive interim phase 2 ASPEN-06 clinical trial results of evorpacept for the treatment of advanced HER2-positive gastric cancer; Evorpacept is the first CD47 blocker to show activity in a global randomized study in solid tumors.

·     Biohaven (BHVN) 10.227M share Spot Secondary priced at $22.00.

·     Cigna Group (CI) will pay more than $172 million over claims it gave the federal government inaccurate Medicare Advantage diagnoses codes to inflate reimbursement.

·     Takeda Pharmaceutical (TAK) said it will voluntarily withdraw its lung cancer therapy from the U.S. after it failed to meet the main goal in a late-stage study; said its therapy, Exkivity, did not meet the requirement for U.S. FDA’s accelerated approval.

·     Vapotherm Inc (VAPO) reiterates its most recent FY23 rev guidance of between $70M-$73M; reiterates its expectation that it will exit 2023 with cash and cash equivalents of $10M-$15M.


Technology, Media & Telecom

·     HP Inc. (HPQ) upgraded to Buy from Underperform at Bank America and raised its price tgt to $33 from $25. Separately, Berkshire Hathaway sold another 5.1 million shares of HPQ in recent days according to filings, continuing to reduce its stake (now hold 10.2% stake).

·     Google (GOOGL) is partnering with HP (HPQ) to manufacture Chromebooks in India for the first time, The Times of India reports.

·     Airbnb (ABNB) downgraded to Sector Weight from Overweight at KeyBanc.


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.