Daily Game Plan

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

TODAY’S ECONOMIC DATA:  8:30ET PPI Final Demand; 9:10ET Fed’s Cook speaks; 10:00ET Fed’s Powell, ECB’s Knot speak

*US APRIL PRODUCER PRICES RISE 0.5% M/M; EST. 0.3%

China rate decision, Eurozone industrial production, GDP, US CPI on Wednesday

HIGHLIGHTS and News:  

• Apple is preparing to sell its Vision Pro outside the US for the first time; approved for sale in China
• Putin will visit China on Thursday and Friday
  
• GAMESTOP EXTENDS SURGE TO MORE THAN 100% IN PREMARKET TRADING
• 10-year yield holding key short term trend line

Global stocks tread water, with MSCI’s world share index just shy of record highs ahead of highly anticipated US inflation data. The producer price index is today’s
main macroeconomic event, though it will be overshadowed by Wednesday’s consumer inflation data. Globally, much now depends on whether the US April inflation report will show a moderation after three months of upside surprises. Median forecasts are for core
consumer prices to rise 0.3% in the month, compared with 0.4% in March, pulling the annual rate down to 3.6%. President Biden hiked tariffs on Chinese imports, including chips, critical minerals, port cranes and medical products, as well as steel, aluminum,
and EVs. Sentiment on equities has improved more broadly, with a Bank of America survey showing that global fund managers are the most bullish since November 2021.       

EQUITIES: 

US equity futures are in extremely quiet mood ahead of today’s PPI figures and tomorrow’s US consumer price index data. Focus remains on the retail inflation print for April to be released
on Wednesday and corporate earnings that can help fuel confidence in risk assets. Meme-stock traders again piled into GameStop and AMC Entertainment after the shares of both firms soared during the previous session in a revival of the retail frenzy. Other
meme names are also rallying. Home Depot’s sales dropped more than expected as it struggles to overcome a weak housing market and lower demand for big-ticket items. 

Futures ahead of the PPI data: E-Mini S&P +0.05%, Nasdaq -0.02%, Russell 2000 +0.5%, DJI +0.1%.

In pre-market trading, meme stocks surge again, leading other high-risk and heavily shorted names higher. GameStop (GME) +144%, AMC Entertainment (AMC) +120%, BlackBerry (BB) +27%, SunPower
(SPWR) +51%, Koss (KOSS) +20%, BlackBerry (BB) +26%, Clover Health (CLOV) +11% and Beyond Meat (BYND) +10%. Merchants Bancorp (MBIN) falls 7% after offering 2.4 million shares. Metals Company (TMC) slips 8% after the deep-sea battery metal explorer said its
net loss widened in the first quarter. On Holding (ONON) rises 9% after the sports apparel group reported net sales for the first quarter that beat estimates. Paysafe (PSFE) gains 13% after the payments platform swung to a profit year-over-year in the first
quarter and revenue beat estimates. StoneCo (STNE) slips 6% after the Brazilian payments company’s revenue missed expectations.

XLK reative to S&P 500 above the descending trend line but still holding the 200 day moving average.

European gauges kept to small ranges for a second day, with traders waiting for US inflation reports to give markets fresh direction. The Stoxx Europe 600 index was little changed, hovering
near a record high. Autos and telecom lead gainers, while insurance and travel fall.  In company news, Delivery Hero soared as much as 22% after Uber announced a $1.25 billion deal to take over its foodpanda food delivery business in Taiwan and buy new shares
in the German firm. Shares in Anglo American fell after the London-based miner outlined a major shake-up to fend of a takeover approach from BHP Group. The UK job market continued to cool, keeping the BOE on track for cuts. The jobless rate ticked up to 4.3%
in the first quarter, while private wage growth slowed slightly. German investor expectations rose more than expected with the ZEW gauge climbing to 47.1 in May. Stoxx 600 +0.1%, DAX -0.1%, CAC +0.03%, FTSE 100 +0.2%. Autos +1.2%, Telecom +1.2%, Utilities
+0.6%. Insurance -1.1%, Travel & Leisure -0.95%.

Asian stocks were muted but mostly higher with the MSCI Asia Pacific Index ending higher by 0.2%. Hong Kong stocks stalled ahead of key technology sector earnings. The Hang Seng index
is up 30% from January’s lows and has surged nearly 20% this month as money has flowed in steadily from mainland buyers. A gauge of Chinese tech companies jumped as much as 2.3% before paring much of the gains. Tencent rose nearly 1% after reporting better
than expected revenues for the first quarter, while Alibaba Group reported after the close. Shares in Japan closed higher after a weak start as investors assessed the prospects for tighter monetary policy from the Bank of Japan. Taiwan +0.6%, Nikkei 225 +0.45%,
Sensex +0.45%, Singapore +0.3%, TOPIX +0.25%, Vietnam +0.25%, Kospi +0.1%. CSI 300 -0.2%, Hang Seng Index -0.2%, ASX 200 -0.3%.

FIXED INCOME: 
 

US Treasury prices treaded water ahead of the US PPI data due today and CPI tomorrow. US 10yr yields are currently lower by 1bps around 4.48%. Treasuries slightly
richer across the curve with front-end outperforming, steepening 2s10s spread back toward top of Monday’s range.  Japanese sovereign bond yields surged to the highest levels in more than a decade amid signs the BOJ is ready to reduce debt purchases to ease
pressure on the yen. US session includes April PPI data and an unscripted appearance by Fed Chair Powell at a Netherlands’ Foreign Bankers’ Association event.

METALS: 
   

Gold edged higher after Monday’s decline of more than 1%, as investors adopt a cautious stance ahead of critical US inflation data releases this week. The market’s
focus today will be on the US Producer Price Index for April, which will be followed by a speech from Federal Reserve Chair Jerome Powell.  Spot gold +0.3%, silver +0.6%.

ENERGY:   

Crude oil is little changed after the OPEC left its monthly forecasts largely unchanged and traders awaited US inflation data.  OPEC saw its crude oil production
decline by 48,000 barrels per day in April compared to March. The organization’s monthly report showed two weeks before the crucial meeting at which the wider OPEC+ group is set to decide on production levels after June.  In the report for May out today, OPEC
said “Going forward, the MOMR will focus on ‘demand for DoC crude’ instead of the usual ‘demand for OPEC crude’.” WTI -0.2%, Brent -0.2%, US Nat Gas -1.5%, RBOB -1%.

CURRENCIES:   

In currency markets, the dollar fluctuated ahead of today’s US PPI data, while the yen extended losses against the dollar to a two-week low. Sterling slipped after
Bank of England Chief Economist Huw Pill said that an interest-rate cut in the summer is in play. Pill said there is “still some work to do” to squeeze domestically generated inflation out of the UK. US$ Index ~flat, GBPUSD -0.05%, EURUSD +0.05%, USDJPY +0.15%,
AUDUSD +0.02%, USDCHF -0.1%

Spot Bitcoin -2%, Ethereum -1.3%. The US ordered a Chinese crypto miner to vacate and sell its property near a Wyoming Air Force base that houses nuclear missiles,
calling the firm a national security threat.

TECHNICAL LEVELS:  

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
• Amicus (FOLD) Raised to Buy at Guggenheim; PT $13
• Atmos Energy (ATO) Raised to Overweight at Wells Fargo; PT $132
• Boston Beer (SAM) Raised to Buy at Jefferies; PT $360
• CG oncology (CGON) Raised to Buy at Goldman; PT $50
• Edison International (EIX) Raised to Overweight at Wells Fargo; PT $86
• Enhabit (EHAB) Raised to Market Perform at Leerink; PT $8.50
• Expeditors (EXPD) Raised to Neutral at BNPP Exane; PT $112
• Expro Group Holdings NV (XPRO) Raised to Overweight at Barclays; PT $27
• Fortrea (FTRE) Raised to Outperform at Baird; PT $36
• Fulcrum Therapeutics (FULC) Raised to Buy at Goldman; PT $15
• Huya (HUYA) ADRs Raised to Buy at HSBC; PT $6
• Legacy Housing (LEGH) Raised to Buy at B Riley; PT $25
• Neuronetics (STIM) Raised to Outperform at William Blair
• Newell Brands (NWL) Raised to Equal-Weight at Barclays; PT $8
• Planet Fitness (PLNT) Raised to Overweight at JPMorgan; PT $78
• Sarepta (SRPT) Raised to Outperform at Oppenheimer; PT $180
• Vtex (VTEX) Raised to Overweight at JPMorgan; PT $9
• Downgrades
• AirSculpt Technologies (AIRS) Cut to Market Perform at Leerink; PT $5
• Applied DNA Sciences (APDN) Cut to Hold at Maxim
• Augmedix (AUGX) Cut to Inline at Evercore ISI; PT $1.50
• Avita Medical Inc (RCEL) Cut to Neutral at Piper Sandler; PT $9
• CareDx (CDNA) Cut to Market Perform at Raymond James
• Dream Residential REIT (DRR/U CN) Cut to Sector Perform at Scotiabank
• Hyperfine (HYPR) Cut to Hold at Jefferies; PT 90 cents
• Inotiv (NOTV) Cut to Hold at Jefferies; PT $3.75
• Jackson Financial (JXN) Cut to Market Perform at KBW; PT $80
• Medical Properties (MPW) Cut to Sector Perform at RBC; PT $5
• Oceaneering (OII) Cut to Underweight at Barclays; PT $21
• RAPT Therapeutics (RAPT) Cut to Peerperform at Wolfe
• RioCan REIT (REI-U CN) Cut to Sector Perform at Scotiabank; PT C$20.50
• Roblox (RBLX) Cut to Neutral at Roth MKM; PT $35
• Tencent Music (TME) ADRs Cut to Sell at 86Research
• Initiations
• Actinium (ATNM) Rated New Overweight at Stephens; PT $25
• Arcellx (ACLX) Rated New Outperform at Evercore ISI
• BioNTech (BNTX) ADRs Rated New Inline at Evercore ISI; PT $100
• Blueprint Medicines (BPMC) Rated New Overweight at Stephens; PT $140
• Cemex (CEMEXCPO MM) ADRs Rated New Underperform at RBC; PT $9
• CRH (CRH) Rated New Outperform at RBC; PT $110
• Deckers Outdoor (DECK) Rated New Outperform at CICC; PT $1,002.17
• Delcath (DCTH) Rated New Overweight at Stephens; PT $25
• Descartes Systems (DSG CN) Rated New Neutral at Redburn
• Elevation Oncology (ELEV) Rated New Overweight at Stephens; PT $8
• Exelixis (EXEL) Rated New Equal-Weight at Stephens; PT $23
• GXO Logistics (GXO) Resumed Overweight at Morgan Stanley; PT $70
• Inovio (INO) Rated New Overweight at Stephens; PT $20
• Kinaxis (KXS CN) Rated New Buy at Redburn; PT C$200
• Lycos Energy Inc (LCX CN) Reinstated Outperform at BMO; PT C$5
• Manhattan Associates (MANH) Rated New Buy at Redburn; PT $260
• Moderna (MRNA) Rated New Inline at Evercore ISI; PT $120
• Nurix (NRIX) Rated New Overweight at Stephens; PT $20
• Perspective Therapeutics (CATX) Rated New Outperform at RBC; PT $3
• Seagate (STX) Reinstated Buy at Citi; PT $110
• Sensei Bio (SNSE) Rated New Overweight at Stephens; PT $5
• SPS Commerce (SPSC) Rated New Buy at Redburn; PT $220
• Vermilion Energy (VET CN) Reinstated Outperform at BMO; PT C$21
• Veru (VERU) Rated New Buy at B Riley; PT $5
• Weatherford (WFRD) Rated New Buy at Citi; PT $155
• Western Digital (WDC) Reinstated Buy at Citi; PT $90

Data sources: Bloomberg, Reuters, CQG