TODAY’S GAME PLAN:
from the trading desk, this is not research
TODAY’S ECONOMIC DATA:
7:00ET US MBA Mortgage Applications, 8:15ET ADP Employment Change, 9:45ET S&P Global Composite and Services PMIs, 10:00ET ISM Services
Highlights and News:
·
Airbus cuts plane delivery goal due to A320 fuselage quality issue
·
Bitcoin surges over $93,000, its highest in two-weeks
·
Eli Weinstein, a twice-convicted fraudster, has taken up a new scheme after receiving a commutation from Trump
·
Money Market Funds hit $8 trillion for the first time in history
Global stocks look to continue Tuesday’s momentum with modestly higher benchmarks ahead of the
US slate of payroll and inflation data. While the US and Russia weren’t able to reach a peace deal after a near five-hour conversation, the Kremlin said the talks were very useful and Putin accepted some US proposals. Tech names in Asia and Europe gained as
a rally from Marvell Technologies in late trading sparked confidence in the sector. The upcoming ADP employment and ISM service reports are expected to show deterioration in private-sector payroll and services growth, adding fuel for a likely rate December
rate cut by the Fed. Treasuries firmed up while the US dollar slipped in anticipation for next week’s key rate meeting.
EQUITIES:
US equity futures are cautiously higher ahead of Wednesday’s economic data. Mag seven stocks
are mixed in early trading, while Oracle and similar names are up behind Marvell Technology’s positive sentiment. Chief economist and strategist at Jefferies, Mohit Kumar, continues to be bullish on risky assets, stating expectations of a dovish Fed chair
is likely to offset any hawkishness next week from Jerome Powell. While Trump says he’ll announce the Fed chief nominee in early 2026, increasing outlook that it will be Kevin Hassett has markets favoring four rate cuts by the end of next year.
Futures ahead of the data/bell: E-Mini S&P +0.27%, Nasdaq +0.2%, Russell 2000 +0.5%, DJI +0.26%
In pre-market trading, Marvell Technology (MRVL) rises 9.6% after the chipmaker’s CEO assuaged
investor concerns with positive trends at its custom chip-design unit. The company also announced plans to acquire startup Celestial AI for about $3.25 billion.
Astera Labs (ALAB) rises 7% as analysts note that Amazon’s AWS Trainium artificial intelligence chip is a positive for the semiconductor manufacturing company.
Pure Storage (PSTG) declines 13% after the computer hardware and storage company reported higher operational expenditure in the third quarter.
Acadia Health (ACHC) slumps 27% after the company cut its adjusted earnings per share guidance for the full year, with analysts disappointed. American Eagle
(AEO) surges 13% after the apparel retailer raised its comparable sales guidance for the full year and reported net revenue for the third quarter that topped the average analyst estimate.
European gauges are higher behind strength from defense and semiconductor stocks in the region.
Following the inconclusive peace negotiations in Russia, European defense stocks climbed, with Germany’s Rheinmetall, Renk, and Hensoldt each gaining at least 3% before paring some of its advance. STMicroelectronics, ASML, and other related stocks gained after
their US peer Marvell Technology signaled continued growth from AI compute spending. Inflation in Switzerland slowed to zero in November, an unexpected result just days before their final interest-rate decision for the year. Strength in France’s services industry
has led to private sector growth in the country for the first time in over a year. Stoxx 600 +0.2%, DAX +0.3%, CAC ~flat, FTSE 100 -0.2%.
Shares in Asia were mixed as stocks in China and Hong Kong weighed on gains made by Japanese
and South Korean tech firms. Companies like Alibaba and Tencent were laggards in the region, down 2% and 1% respectively. Japan’s Softbank jumped over 6.3% after Citi upgraded the company after determining concerns about its investment in OpenAI and financial
health risks are overdone. Other tech and electronic stocks, including Tokyo Electron, Samsung Electronics, and TSMC are also higher on positive sentiment following Marvell Technology’s strong rally in after-hour trading. India’s Nifty 50 index is slightly
lower as the Rupee makes a fresh low against the dollar. Kospi +1.0%, Topix -0.2%, Taiwan +0.8%, Vietnam +0.9%, Indonesia ~flat, ASX 200 +0.2%, CSI 300 -0.5%, Hang Seng Index -1.3%. Thailand -0.2%.
FIXED INCOME:
Yields are lower across the US Treasury curve, with the 10-year at 4.073%; Treasury markets started
to recover after the selloff caused by concerns of BOJ’s likely rate hike in December. The chance of a 25-bps rate cut continues to go higher, currently sitting at 89.2%. Money markets are pricing in just over 2 quarter point cuts through mid-2026. The 10-year
yield hit 50 DMA and faced resistance.
METALS:
Gold and Silver are slightly higher, while copper surge 2.1% to a fresh record high after requests
to withdraw metal from LME warehouses jumped by the most since 2013. Order in Asia are adding to mounting shortage fears as traders divert supply to the US ahead of potential import tariffs against a backdrop of ongoing mine disruptions from Indonesia to Chile
and tough 2026 contract talks where miners hold the upper hand over Chinese smelters. Spot gold +0.2%, Silver +0.1%, Copper futures +2.1%.
ENERGY:
Oil jumped 1.42% as traders weighted talks between US and Russian that have so far failed to
end the war in Ukraine. Natural Gas is up 3.24%, rising further to 3-year high as EU finalizes a deal to phase out Russian Gas imports by 2027. WTI +1.4%, Brent +1.3%, US Nat Gas +2.7%, RBOB +1.1%.
CURRENCIES:
In currency markets, the dollar extended its slide for a seventh straight session, while sterling
outperformed G10 peers, rising about 0.6%.. The yen also firmed as markets continue to price in a likely BOJ rate hike this month. US$ Index -0.4%, GBPUSD +0.7%, EURUSD +0.4%, USDJPY +0.3%, AUDUSD +0.4%, NZDUSD +0.3%, USDCHF +0.4%, USDCAD +0.2%, USDSEK +0.5%,
USDNOK +0.6%.
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
o
American Eagle (AEO) Raised to Neutral
at JPMorgan; PT $20
o
Cresco Labs (CL CN) Raised to Outperform
at ATB Capital; PT C$2.50
o
CSW Industrials (CSW) Raised to Overweight
at JPMorgan; PT $350
o
Curaleaf (CURA CN) Raised to Outperform
at ATB Capital; PT C$4.50
o
Design Therapeutics (DSGN) Raised to
Outperform at Leerink; PT $14
o
Driven Brands (DRVN) Raised to Outperform
at William Blair
o
Equinix (EQIX) Raised to Outperform at
BMO; PT $900
o
Garmin (GRMN) Raised to Buy at Longbow
o
Lyft (LYFT) Raised to Neutral at Arete;
PT $20
o
Novartis (NOVN SW) ADRs Raised to Overweight
at Morgan Stanley; PT $136
o
PennantPark Investment (PNNT) Raised
to Neutral at Compass Point
o
Schneider National (SNDR) Raised to Outperform
at Raymond James; PT $28
o
Spruce Bio (SPRB) Raised to Outperform
at Leerink; PT $160
o
Uber (UBER) Raised to Buy at Arete; PT
$125
o
Vertex Pharmaceuticals (VRTX) Raised
to Overweight at Morgan Stanley
o
Well Health Technologies (WELL CN) Raised
to Outperform at CIBC; PT C$5.50
- Downgrades
o
Acadia Health (ACHC) Cut to Market Perform
at Leerink; PT $14
o
Applied Therapeutics (APLT) Cut to Market
Perform at Leerink; PT $1
o
Aurinia Pharmaceuticals (AUPH) Cut to
Market Perform at Leerink; PT $16
o
Biohaven (BHVN) Cut to Neutral at HC
Wainwright; PT $11
o
BioMarin (BMRN) Cut to Market Perform
at Leerink; PT $60
o
Charter Communications (CHTR) Cut to
Strong Sell at CFRA
o
Cognex (CGNX) Cut to Underweight at JPMorgan;
PT $35
o
Goeasy (GSY CN) Cut to Market Perform
at Raymond James; PT C$153
o
InflaRx (IFRX) Cut to Market Perform
at Leerink; PT $2
o
Jamf Holding (JAMF) Cut to Market Perform
at Citizens
o
Pure Storage (PSTG) Cut to Neutral at
Susquehanna; PT $100
o
Regeneron (REGN) Cut to Equal-Weight
at Morgan Stanley; PT $767
o
Wayfair (W) Cut to Hold at Jefferies;
PT $94
- Initiations
o
Aardvark Therapeutics (AARD) Rated New
Strong Buy at Raymond James
o
Agilent (A) Rated New Overweight at Morgan
Stanley; PT $180
o
AppLovin (APP) Reinstated Buy at William
O’Neil
o
Bloom Energy (BE) Rated New Hold at Daiwa;
PT $98
o
Capri Holdings (CPRI) Reinstated Overweight
at Barclays; PT $31
o
CBL Properties (CBL) Rated New Buy at
Ladenburg Thalmann; PT $45
o
Compass Therapeutics (CMPX) Rated New
Overweight at Cantor
o
Rated New Buy at Canaccord; PT $10
o
Rated New Market Outperform at Citizens
o
D-Wave Quantum (QBTS) Rated New Outperform
at Evercore ISI; PT $44
o
DBV Tech (DBV FP) ADRs Rated New Buy
at Guggenheim; PT $35
o
Honeywell (HON) Rated New Neutral at
BNPP Exane; PT $195
o
Klarna (KLAR) Rated New Buy at President
Capital Management; PT $39
o
Lam Research (LRCX) Rated New Add at
CTBC Securities; PT $175
o
Linde (LIN) Rated New Outperform at CICC;
PT $510
o
Microbot Medical (MBOT) Reinstated Buy
at Roth Capital Partners
o
Northstar Clean Technologies (ROOF CN)
Rated New Speculative Buy at ATB Capital
o
Oracle (ORCL) Rated New Overweight at
Wells Fargo; PT $280
o
Palatin Technologies (PTN) Rated New
Buy at Lucid Capital Markets
o
Pelthos Therapeutics (PTHS) Rated New
Buy at HC Wainwright; PT $60
o
Pitney Bowes (PBI) Rated New Market Outperform
at Citizens; PT $13
o
Theravance Bio (TBPH) Rated New Outperform
at Oppenheimer; PT $27
o
Traws Pharma Inc (TRAW) Rated New Buy
at HC Wainwright; PT $8
o
Viridian Therapeutics Inc (VRDN) Rated
New Outperform at William Blair
o
Wyndham Hotels (WH) Rated New Neutral
at Mizuho Securities; PT $71
o
Zymeworks (ZYME) Rated New Market Outperform
at Citizens; PT $32
Data sources: Bloomberg, Reuters, TradingView
Bryan Duong
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