Daily Game Plan

TODAY’S GAME PLAN:  from the trading
desk, this is not research

TODAY’S ECONOMIC DATA:  8:30ET Jobless Claims, GDP, Personal Consumption, Core PCE Price Index (All Delayed); 9:15ET
ECB Rate Decision; 9:55ET Fed’s Bowman speaks; 1:15ET Fed’s Logan speaks

Highlights and News:  

• TRUMP ON CHINA: WE HAVE A DEAL, XI AGREED TO WORK TO STOP FENTANYL FLOW
• TRUMP: CHINA TO BEGIN PROCESS OF PURCHASING AMERCIAN ENERGY
• TRUMP: CHINA TALKING TO NVIDIA AND OTHERS ABOUT TAKING CHIPS
• OpenAI May Target $1T Valuation in IPO
• Trump Orders Nuclear Tests in Russia Response

Global stocks steadied as investors weighed a US-China trade truce, mixed technology earnings and a cautious Federal Reserve. Trump and Xi Jinping agreed to extend
a tariff truce, roll back export controls and reduce other trade barriers. The US will halve fentanyl-related tariffs on Chinese goods, while Beijing resumes purchases of soybeans and other farm products, and the US is extending a pause on some reciprocal
tariffs on China for an additional year. The agreement includes China pausing sweeping controls on rare-earth magnets. Still, the agreement falls short of a comprehensive trade deal or a structural realignment. Elsewhere, the Bank of Japan kept interest rates
steady, while sending the strongest signal yet that a rate hike was possible as soon as December depending on the outlook for wages next year. Euro area’s GDP rose 0.2% in Q3, more than the +0.1% economists expected,
showing resilience to higher US tariffs, with France recording its strongest growth in over two years.  Confidence across Britain’s small businesses plunged in the third quarter
due to anxiety around higher taxes in next month’s budget, with nearly a third predicting they’ll downsize or close down in the next year.

EQUITIES: 

 US equity futures ease from record highs after Presidents Trump and Xi conclude their meeting in South Korea without major surprises. Trump hailed an “amazing meeting” with his Chinese
counterpart, where the two sides agreed to roll back export controls and ease other trade barriers — steps that were largely anticipated by markets.  In corporate earnings, Meta and Microsoft concerned investors with increased spending on AI, leaving shares
under pressure, while Alphabet beat revenue expectations, sending its stock up 8%. Eli Lilly shares jumped premarket after the company boosted its full-year revenue forecast. OpenAI is preparing to file for an IPO as soon as next year that may value the company
at $1 trillion, Reuters reported. Trump ordered nuclear weapons trials in response to Russia’s recent tests of nuclear-powered underwater drones and cruise missiles. The last US nuclear explosive test was in 1992. Meanwhile, the Republican-controlled Senate
narrowly passed a bill to end the president’s tariffs on Canada.  

Futures ahead of the bell: E-Mini S&P -0.3%, Nasdaq -0.4%, Russell 2000 -0.3%, DJI -0.4%.

In pre-market trading, Alphabet (GOOGL) gains 7% after the Google parent reported third-quarter results that beat expectations. Analysts are especially positive on
its cloud-computing business. Meta Platforms (META) sinks 8% after the Facebook parent reported third-quarter results and gave an outlook. Analysts noted some concern over the company’s heavy spending. Microsoft (MSFT) is down 2% after the software company
reported its first-quarter results. Analysts are broadly positive on the report, especially growth in its Azure cloud-computing business, but said investor expectations were elevated. Calix (CALX) rises 8% after the application software company reported third-quarter
results that beat. Carvana (CVNA) falls 7% after the used-car retailer failed to live up to “elevated buy-side bar.”  Eli Lilly & Co. (LLY) gains 4% after raising its full-year guidance as revenue from its blockbuster weight loss and diabetes drugs beat analysts’
estimates in the third quarter. FMC Corp (FMC) sinks 29% after the agricultural chemical company reported worse-than-expected revenues and cut its guidance. FormFactor (FORM) rises 14% after the semiconductor manufacturing company reported third-quarter results
that beat.  Guardant Health (GH) rallies 26% after the biotech company boosted its revenue guidance for the full year. Insmed (INSM) climbs 12% after the biotech firm posted quarterly results. MediaAlpha (MAX) climbs 11% after the insurance technology company
reported its third-quarter results and gave an outlook that analysts are positive on. REV Group (REVG) rises 6% after Terex agreed to buy the manufacturer of specialty vehicles. Sprouts Farmers Market (SFM) tumbles 23% after the grocery store chain reported
comparable store sales that missed estimates and lowered its forecast for full-year comp sales. TransMedics (TMDX) drops 10% after the transplant-therapy company reported total revenue for the third quarter that fell short of the average analyst estimate.

European gauges slipped as investors reacted to a packed earnings schedule and looked ahead to an interest-rate decision by the European Central Bank. Drink maker Campari
leads gains on the Stoxx 600 after a strong report, while weaker results hurt the shares of Norwegian defense group Kongsberg and advertising agency WPP. Raiffeisen shares rose as much as 5.9% after the Austrian lender delivers consensus-beating third-quarter
results. Car leasing company Ayvens gained as much as 11% after reporting and announced a buyback. Kongsberg shares drop as much as 15% after the military technology company missed estimates. Stoxx 600 -0.5%, DAX -0.2%, CAC -0.9%, FTSE 100 -0.6%. Media -1.6%,
Basic Resources -1.2%, Telecom and Autos -1.2%. Technology +0.4%.

Shares in Asia were mostly lower after Trump and Xi Jinping concluded a meeting that was seen as easing tensions between the world’s two largest economies but may have
been largely priced into markets. The MSCI Asia Pacific Index fell 0.4%, reversing an early advance of as much as 0.5%. Softbank and Wesfarmers were among key drags. South Korean stocks ended slightly higher after the nation sealed a trade deal with the US
and Samsung Electronics posted a big bump in profits from its chip business. Stocks rose in Japan after the central bank held interest rates. Rare earth stocks in Asia extended losses after President Trump said there were “no roadblocks” in US-China talks
over critical minerals following their meeting. Vietnam -1%, CSI 300 -0.8%, Sensex -0.7%, Philippines -0.6%, ASX 200 -0.5%, Hang Seng Index -0.25%, Taiwan -0.03%. Nikkei 225 +0.05%, Kospi +0.15%, Indonesia +0.2%, Topix +0.7%.

FIXED INCOME: 
 

Treasury yields are higher with the curve a bit steeper by about 1.5bps. US 10-year near 4.10% exceeds Wednesday’s high by 3bps. Fed-dated OIS also hover around Wednesday’s
closing levels, pricing in around 15bp of easing for the December rate decision. IG dollar issuance slate includes HSBC three-part offering. This week’s volume stands at $37.2 billion vs dealer expectations for about $20 billion. Focal points of US session
include speeches by Fed’s Bowman and Logan. 50bps of cuts since September and rates are higher in the 2 yr and 10 yr. 2/10 yield curve held the key 200 day moving average yesterday.

METALS: 

Gold rebounded after a 5% slide over four sessions as investors digest the outcome of the Trump-Xi meeting and sniff out the chances for
more Fed cuts. Another factor offering temporary support for gold is the ongoing political deadlock in the US. LME Copper retreated from the previous session’s record high after President Trump and his Chinese counterpart Xi Jinping concluded pivotal trade
talks. Trump called the roughly 90-minute meeting with Xi “amazing,” and said that the US would halve fentanyl-related tariffs on Chinese goods immediately. China announced a halt to rare-earth export controls introduced on Oct. 9 and said the US will extend
the suspension of a 24% reciprocal tariff.  Spot gold +1.3%, Silver +1.2%, Copper futures -1.7%.

ENERGY:   

Oil prices eased as traders assessed a truce in a trade spat between the United States and China, as Trump lowered tariffs on China after a meeting with President
Xi Jinping. “A very large-scale transaction may take place concerning the purchase of Oil and Gas from the Great State of Alaska,” President Trump posted on Truth Social after his meeting with China’s Xi Jinping. “China also agreed that they will begin the
process of purchasing American Energy,” Trump added. Global power demand will continue to grow rapidly over the next decade, jumping about 30% as EVs, data centers and the need to heat and cool buildings increases, according to Rystad. Hurricane Melissa moved
past Jamaica, Haiti and Cuba leaving at least 33 deaths and almost $8 billion of damage in its wake. The now Category 1 storm is set to accelerate over the next two days, moving toward the northwest of Bermuda this evening. WTI -0.7%, Brent -0.7%, US Nat Gas
+0.2%, RBOB -1.25%. 

CURRENCIES: 

In currency markets, the dollar inched up after Trump and Chinese leader Xi Jinping cemented a temporary trade truce, with Washington agreeing to lower tariffs in
return for Beijing’s reprieve on rare earths. The yen fell sharply after the BOJ held rates and sees inflation decelerating next year. At a post-meeting press conference, BOJ Governor Ueda offered little detail on when the central bank could next raise rates.
The euro steadied ahead of a policy decision by the European Central Bank where it is expected to leave rates on hold for a third meeting in a row. US$ Index +0.1%, GBPUSD -0.1%, EURUSD -0.02%, USDJPY +0.9%, AUDUSD -0.3%, NZDUSD -0.2%, USDCHF +0.05%, USDCAD
+0.3%, USDSEK +0.15%, USDNOK +0.4%.

Bitcoin -1.9%, Ethereum -2%.

Colors within the report:
Green is always the 200 period (day, week).
Red is always 21,
Blue = 50,
Brown =
100 *Stars have added importance 

• Upgrades
• Azenta (AZTA) Raised to Buy at Jefferies; PT $38
• C.H. Robinson (CHRW) Raised to Overweight at Stephens
• Coinbase (COIN) Raised to Buy at HC Wainwright; PT $425
• Comerica (CMA) Raised to Inline at Evercore ISI; PT $88
• Etsy (ETSY) Raised to Buy at CFRA; PT $88
• Extreme Networks (EXTR) Raised to Outperform at Oppenheimer; PT $25
• FormFactor (FORM) Raised to Buy at Citi; PT $62
• Guardant Health (GH) Raised to Hold at Nephron Research; PT $80
• Renasant (RNST) Raised to Outperform at Hovde Group; PT $41
• Steven Madden (SHOO) Raised to Outperform at Telsey; PT $43
• Teradyne (TER) Raised to Buy at BofA; PT $205
• Vale (VALE3 BZ) ADRs Raised to Buy at Banco BTG Pactual; PT $15
• Verisk (VRSK) Raised to Overweight at Barclays; PT $275
• Viavi (VIAV) Raised to Buy at B Riley; PT $18
• Warner Bros Discovery (WBD) Raised to Buy at Rothschild & Co Redburn
• Downgrades
• American Electric Power (AEP) Cut to Market Perform at BMO; PT $126
• Avantor (AVTR) Cut to Equal-Weight at Barclays; PT $12
• Cut to Neutral at JPMorgan; PT $12
• Boeing (BA) Cut to Hold at Deutsche Bank; PT $240
• CSG Systems (CSGS) Cut to Sector Perform at RBC; PT $80.70
• Cut to Market Perform at William Blair
• Cut to Hold at Stifel; PT $80.70
• Cut to Market Perform at Northland; PT $80.70
• Etsy (ETSY) Cut to Inline at Evercore ISI
• Fiserv (FI) Cut to Equal-Weight at Morgan Stanley; PT $81
• Cut to Neutral at Goldman; PT $79
• Cut to Neutral at Seaport Global Securities
• Cut to Hold at Truist Secs
• Cut to Hold at TD Cowen; PT $80
• Cut to Neutral at B Riley; PT $105
• Cut to Neutral at BTIG
• Cut to Peerperform at Wolfe
• FMC Corp (FMC) Cut to Hold at Fermium Research; PT $28
• Jamf Holding (JAMF) Cut to Neutral at Mizuho Securities; PT $13
• Cut to Hold at Needham
• Materion (MTRN) Cut to Sector Weight at KeyBanc
• Meta (META) Cut to Hold at Benchmark
• Cut to Market Perform at Oppenheimer
• Neste (NESTE FH) ADRs Cut to Neutral at BNPP Exane; PT $11.20
• Sun Life Financial (SLF CN) Cut to Neutral at CIBC; PT C$94
• Initiations
• Abaxx Technologies Inc (ABXX CN) Rated New Buy at Cantor; PT C$81
• Cisco (CSCO) Reinstated Buy at President Capital Management; PT $90
• DiaMedica (DMAC) Rated New Buy at TD Cowen
• Doman Building Materials (DBM CN) Rated New Buy at Desjardins; PT C$11
• Draganfly (DPRO CN) Rated New Buy at Needham; PT C$27.89
• Evaxion (EVAX) ADRs Rated New Buy at Jones; PT $10
• Futu Holdings (FUTU) ADRs Reinstated Buy at William O’Neil
• GeneDx Holdings Corp (WGS) Rated New Buy at William O’Neil
• Kodiak AI (KDK) Rated New Buy at Chardan Capital Markets; PT $22
• Qnity Electronics (Q-W) Rated New Outperform at RBC; PT $120
• RealReal (REAL) Rated New Buy at Roth Capital Partners; PT $17.50
• Stubhub (STUB) Rated New Neutral at Guggenheim; PT $19
• ThredUp (TDUP) Rated New Buy at Roth Capital Partners; PT $11

Data sources: Bloomberg, Reuters, CQG

David Wienke