Morning Preview: September 17, 2021

Early Look

Thursday, September 16, 2021

Futures

Up/Down

%

Last

Dow

-106.00

0.30%

34,521

S&P 500

-15.25

0.34%

4,449

Nasdaq

-45.50

0.29%

15,463

 

 

U.S. stock futures are edging lower ahead of an interesting day (potentially) for U.S. stock markets as the FDA will hold an advisory committee today to hash out whether Covid-19 boosters should be quickly approved in the U.S., which specifically will review an application from Pfizer (PFE) and BioNTech (BNTX) for a third dose of their mRNA vaccine. Volatility and volume could also pick up today with quadruple witching (date on which derivatives of stock index futures, stock index options, stock options, and single stock futures expire simultaneously – happens third Friday of March, June, September, and December) and options expiration. In Asian markets, The Nikkei Index rose 176 points to 30,500, the Shanghai Index edged higher 6 points to 3,613, and the Hang Seng Index jumped 252 points to 24,920. In Europe, the German DAX is down about -45 points to 15,600, while the FTSE 100 is down about -15 points to 7,010. China Evergrande, the deeply indebted property developer that many analysts fear could trigger a mini financial crisis in China, is not “too big to fail”, according to a state-backed newspaper. Major stock averages end mixed on Thursday after a choppy trading session as investors weigh the latest economic data and continued overnight losses in China due to fears about economic slowdown and the company’s regulatory crackdown companies. Economic data was favorable as initial jobless claims rose to 332K in-line with forecasts while retail sales unexpectedly rose +0.7% in August vs. an expected decline of (-0.8%). The three major indexes spent much of the day in negative territory as rising U.S. Treasury yields pressured market-leading tech stocks, and the rising dollar weighed on exporters.

Market Closing Prices Yesterday

·     The S&P 500 Index dropped -6.95 points, or 0.16%, to 4,473.75

·     The Dow Jones Industrial Average fell -63.07 points, or 0.18%, to 34,751.32

·     The Nasdaq Composite edged higher 20.39 points, or 0.13%, to 15,181.92

·     The Russell 2000 Index declined -1.54 points, or 0.07% to 2,232.91

 

Events Calendar for Today

·     10:00 AM ET      University of Michigan Sentiment, Sept-P

·     1:00 PM EST       Baker Hughes Weekly rig count data

 

Other Key Events:

·     Citigroup Small/Mid-Cap & Growth Conference 2021 (virtual), 9/16-9/17

·     European Society for Medical Oncology (ESMO) 2021 Virtual Congress, 9/16-9/21

 

 

Macro

Up/Down

Last

Nymex

-0.56

72.05

Brent

-0.46

75.21

Gold

10.50

1,764.30

EUR/USD

0.0017

1.1784

JPY/USD

0.22

109.95

10-Year Note

+0.005

1.336%

 

 

World News

·     UK Aug Retail Sales declined -0.9% m/m vs 0.5% consensus and flat y/y vs 2.7% consensus; UK Aug Retail Sales Ex-Fuel declined -1.2% m/m vs 0.8% consensus, -0.9% y/y vs 2.5% consensus

·     China Evergrande, the deeply indebted property developer that many analysts fear could trigger a mini financial crisis in the world’s second-largest economy, is not “too big to fail”, according to a state-backed newspaper. Evergrande, which is teetering under the weight of more than $310 billion in debts, and faces $150 million in coupon payments later this month, can’t assume the government will step in and rescue it, Global Times reported

 

Sector News Breakdown

Consumer

·     International Flavors (IFF) said it now expects FY 2021 sales to grow greater than 8% on a combined company basis, to about $11.55 bln with double-digit growth anticipated for Q3 and expects adj operating Ebitda margin for FY about 21.5%

·     Usana Health Sciences (USNA) increases share repurchase authorization to $150M and guides Q3 EPS $1.28-$1.33 vs. est. $1.44 on sales $265M-$270M. below est. $302.9M; said Q3 sales have been softer than anticipated, largely because of increased disruptions and lockdowns due to pandemic; lowers FY21 EPS to $5.80-$6.00 from $6.15-$6.50 and cuts FY21 revenue to $1.18B-$1.20B from $1.24B-$1.28B

·     Zumiez Inc. (ZUMZ) approved repurchase of up to an aggregate of $150M of its common stock

·     Scientific Games Corp (SGMS) is seeking to list its predominantly North American and European lotteries unit in Australia in a $5 billion IPO, the country’s biggest in at least seven years, two sources told Reuters

 

Energy, Industrials and Materials

·     United States Steel Corp (X) said Q3 adjusted Ebitda is expected to be approximately $2.0B; has reduced its debt by approximately $2.7B, excluding impact of debt assumed in connection with big river steel acquisition and said expect Q3 to be a quarter of records; flat-rolled segment is expected to deliver record Ebitda and margin in Q3

·     Diamondback Energy, Inc. (FANG) accelerates capital return to stockholders and initiates share repurchase program; announces $2B share buyback

 

Healthcare

·     The FDA will hold an advisory committee today to hash out whether Covid-19 boosters should be quickly approved in the U.S., which specifically will review an application from Pfizer (PFE) and BioNTech (BNTX) for a third dose of their mRNA vaccine. The panel, which includes about 20 advisers, will hear presentations from Pfizer, which has asked regulators to clear booster shots for people 16 years and older, and the FDA, which this week said all the shots cleared for use in the U.S. remain effective without boosters. The hearing will be held between 8:30-4:45 PM

·     Novartis (NVS) announces positive health-related quality of life (HRQoL) data from its Phase III VISION study evaluating 177Lu-PSMA-617 plus standard of care for metastatic castration-resistant prostate cancer (mCRPC) vs standard of care alone.

·     AbCellera Biologics (ABCL) confirmed that the U.S. FDA expanded its emergency authorization to use a Lilly-partnered Covid-19 antibody cocktail for post-exposure prevention of infection or symptomatic disease

 

Technology, Media & Telecom

·     Channel Advisor (ECOM) announces long-term financial targets, share repurchase authorization; said 2025 Revenue targeted to exceed $250M with adjusted EBITDA in excess of $50M; Board of Directors authorizes opportunistic share repurchases of up to $25M

·     Take-Two Interactive Software (TTWO) downgraded to market perform from outperform at BMO on reduced confidence in previously Street- high earnings estimates

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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.