Morning Preview: September 24, 2024

Early Look

Tuesday, September 24, 2024

Futures

Up/Down

%

Last

Dow

57.00

0.13%

42,558

S&P 500

9.25

0.17%

5,786

Nasdaq

58.50

0.29%

20,138

 

 

After rising on Monday to kick off the week, U.S. futures are adding to gains, as the S&P 500 and Dow look to make fresh new record highs (Nasdaq within 3%), boosted by industrial and material stocks after China’s central bank lowered interest rates and the government added stimulus designed to bolster the stock market. China’s Central bank will cut banks’ reserve requirement ratio (RRR) by 50 basis points soon, freeing up about 1 trillion yuan ($142.21B) for new lending. Seeing industrial metals, precious metals, lithium and rare earth related stocks all moving higher, as well as US listed China stocks (BABA, BIDU, PDD, JD, LI, NIO, etc.) on the stimulus measures. In Asian markets, The Nikkei Index advanced 216 points to 37,940, the Shanghai Index surged 114 points or 4.15% to 2,863, and the Hang Seng Index jumped 753 points to 19,000. In Europe, the German DAX is up 137 points to 18,984, while the FTSE 100 is up 33 points to 8,293. Heading into Q4 in 2 weeks, the S&P (SPX) is +19.55% YTD led by: Energy (XLE) is the only S&P sector not up more than double digit % (+6.3% YTD), with the best sectors YTD Utilities (XLU) +26.8%, Communications (XLC) +22.25% and Financials (XLF)+20.85%; the other 7 sectors up between 10.4% and 17.24%. Busy day of economic data, but the GDP on Thursday and PCE inflation on Friday are the main data points this week.

 

Market Closing Prices Yesterday

  • The S&P 500 Index gained 16.02 points, or 0.28%, to 5,718.57.
  • The Dow Jones Industrial Average rose 61.29 points, or 0.15%, to 42,124.65.
  • The Nasdaq Composite gained 25.95 points, or 0.14%, to 17,974.27.
  • The Russell 2000 Index declined -7.61 points, or 0.34% to 2,220.42.

Economic Calendar for Today

  • 7:45 AM ET ICSC Weekly Retail Sales
  • 8:55 AM ET                  Johnson/Redbook Weekly Sales
  • 9:00 AM ET                  Monthly Home Prices M/M for July
  • 9:00 AM ET                  CaseShiller 20 City index for July…est. +0.4%
  • 10:00 AM ET                Consumer Confidence for September…est. 104.0
  • 10:00 AM ET                Richmond Fed Index for September…prior (-19)
  • 1:00 PM ET U.S. Treasury to sell $69B in 2-year notes
  • 4:30 PM ET API Weekly Inventory Data

Earnings Calendar:

  • Earnings Before the Open: AZO THO
  • Earnings After the Close: KBH PRGS SFIX WOR

Other Key Events:

  • BMO Capital Dallas & Austin Property Tour, 9/24-9/27, in Dallas, Tx
  • Deutsche Bank 32nd Annual Leveraged Finance Conference, 9/23-9/25, in Scottsdale, AZ
  • Oppenheimer Innovating Sustainability Summit, 9/24
  • RBC Capital Pharmaceutical CDMO & Bioprocessing Conference, 9/23-9/24
  • RBC Capital Global Communications Infrastructure Conference 9/24-9/25, in Chicago, IL
  • RBC Capital Global Industrials Conference 9/24-9/25, in Las Vegas

 

 

Macro

Up/Down

Last

Nymex

1.71

72.08

Brent

1.77

75.68

Gold

6.50

2,659.00

EUR/USD

0.0021

1.1133

JPY/USD

0.34

143.94

10-Year Note

+0.047

3.783%

 

World News

  • China’s central bank lowered interest rates and the government added stimulus designed to bolster the stock market. China’s Central bank will cut banks’ reserve requirement ratio (RRR) by 50 basis points in the near future, freeing up about 1 trillion yuan ($142.21B) for new lending. Depending on the market liquidity situation later this year, the RRR May be further lowered by 0.25-0.5 percentage points, PBOC Governor Pan Gongsheng said.

Sector News Breakdown

Consumer

  • Danone (DANOY) offered to buy all the outstanding shares of Lifeway (LWAY) that it doesn’t already own for about $283.4M; as of August 6, Danone had about 14.8 million outstanding shares, of which about 23%, or 3.45 million, are already owned by Danone, a Paris-based food and beverage company. https://tinyurl.com/43tdfpra
  • Starbucks (SBUX) downgraded to Underperform from Hold at Jefferies and cut tgt to $76 from $80.
  • Thor Industries (THO) Q4 EPS $1.68 vs consensus $1.30 and Q4 revenue $2.53B tops consensus $2.47B; sees FY25 EPS $4.00-$5.00 well below consensus $6.35 and guides FY25 revenue $9.0B-$9.8B below consensus $10.45B; said anticipate that the RV market will continue to be challenging throughout our fiscal year which ends on July 31, 2025.

Energy, Industrials and Materials

  • The U.S. Federal Trade Commission is expected to greenlight U.S. oil producer Chevron’s (CVX) purchase of Hess (HES) as soon as this week, two people familiar with the matter said, leaving Exxon Mobil’s (XOM) challenge to the $53 billion deal as its final hurdle, Reuters reported. https://tinyurl.com/35s28u3y
  • AAR Corp. (AIR) Q1 adj EPS $0.85 vs. est. $0.82; Q1 revs $662M vs. est. $645.5M; said drove 26% organic growth in our new parts distribution activities, had strong operational performance in our hangars and saw a return to growth in our government business.
  • Deere Inc. (DE) shares slipped after hours after Donald Trump said if elected President, would look to put tariffs on the company if they moved to manufacturing business to Mexico. He said yesterday, “I’m just notifying John Deere right now, if you do that, we’re putting a 200% tariff on everything you sell into the US.”
  • Hawaiian Electric (HE) 54.05M share Spot Secondary priced at $9.25.

Financials

  • Visa (V) shares slip after Bloomberg reported that the Justice Department plans to file a lawsuit accusing the credit-card company of anticompetitive behavior as soon as Tuesday.
  • Hartford Financial Services Group Inc (HIG) files for mixed shelf offering.
  • Simon Property Group (SPG) sells $1B of senior notes.

Healthcare

  • Natera (NTRA) issued a statement regarding its ongoing patent infringement litigation with NeoGenomics (NEO) in response to inquiries: “On Sept. 23, 2024, the District Court for the Middle District of North Carolina entered a permanent injunction against NeoGenomics’ accused RaDaR assay, which was preliminarily enjoined in December 2023. Natera continues to prosecute its claim against a modified version of RaDaR for infringement of Natera’s ‘454 patent. Natera seeks full remedies, including injunctive relief, after the Patent Office denied NeoGenomics’ petition for ‘inter partes’ review challenging the validity of the ‘454 patent.”
  • QIAGEN (QGEN) and Bode Technology partner to advance use of GEDmatch PRO forensic genetic genealogy database.

Technology, Media & Telecom

  • Jamf Holding (JAMF) backs Q3 revenue view $156.5M-$158.5M, vs. consensus $157.54M; backs FY24 revenue view $622.5M-$625.5M, vs. consensus $624.09M.
  • Liberty Broadband (LBRDA): John Malone’s media company said Monday it was considering an all-stock merger with Charter Communications (CHTR). Liberty’s class A shares rallied in off hours trading.
  • Snowflake (SNOW) announces proposed private placement of $2.0B of convertible senior notes; expects to use net proceeds from offering to pay cost of capped call transactions.

_________________________________________________________________

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.