Daily Game Plan

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

TODAY’S ECONOMIC DATA:  10:40ET Fed’s John Williams speaks;  1:00ET Fed’s Raphael Bostic speaks

HIGHLIGHTS and News:  

• A problem with one of CrowdStrike’s products caused Microsoft’s Windows operating system to crash
• Biden’s campaign team called an all-staff meeting today to discuss his reelection bid, the AP said
• Zelenskiy and Trump have scheduled a phone call this week; CNN said
• NASDAQ: NO IMPACT TO NASDAQ EXCHANGE SYSTEMS ON MICROSOFT ISSUE
  
• RUSSIAN COURT CONVICTS WSJ REPORTER OF ESPIONAGE (SENTENCED 16 YRS): RIA

Global equities extended declines as worldwide computer systems outages threatened to exacerbate a pullback in technology stocks. A global outage hitting services
from airlines, banks and financial services capped a turbulent week in markets. A tech sell-off sparked by deepening Sino-U.S. trade tensions, uncertainty over President Joe Biden’s fate in the presidential race, disappointing Chinese economic data and a lackluster
third plenum outcome has cast a shadow over the global mood. Houthi rebels claimed responsibility for an explosion in central Tel Aviv using a new type of drone that’s difficult for radar to detect.             

EQUITIES:  
US markets to open normally

US equity futures (mixed) reverse overnight lows reached as large-cap tech names fell during a global IT outage whose underlying cause has reportedly been fixed. Major US airlines grounded
flights on Friday citing communications issues, while other carriers, media companies, banks and telecoms firms around the world also reported system outages were disrupting their operations. Cybersecurity firm Crowdstrike slid as much as 20% in US premarket
trading after warning its software was causing computer systems to crash. Microsoft shares dropped 2%, though it said it had resolved the cloud-services outage that was blamed for disrupting flights and banks globally.  Netflix slipped post-market after guidance
from the streaming-video giant missed expectations. Donald Trump pledged to end policies that favor EVs as he accepted the GOP’s nomination at the RNC. He also promised lower taxes and energy costs, and to end the illegal immigration crisis.

Futures ahead of the bell: E-Mini S&P +0.02%, Nasdaq +0.1%, Russell 2000 -0.1%, DJI -0.2%

In pre-market trading, IT outages across the globe are weighing on several sectors, including airlines, insurers and stock exchange operators. Crowdstrike (CRWD) is down 10% after a widely
used cybersecurity program crashed.  American Express (AXP) falls 2% after posting 2Q results. Corsair Gaming (CRSR) declines 6% after the gaming and streaming-gear company reported 2Q preliminary sales that disappointed. Halliburton (HAL) slips 2% after posting
2Q revenue that is shy of estimates. Hawaiian Electric (HE) soars 36% after Bloomberg reported it is among the companies that have tentatively agreed to pay more than $4 billion to resolve hundreds of lawsuits over the wildfires that ripped through Maui last
year. Intuitive Surgical (ISRG) rises 5% after the company’s 2Q adjusted earnings per share came ahead of consensus estimates. Plug Power (PLUG) sinks 11% after the fuel cell company launched a $200 million stock offering. SunPower (SPWR) slides 17% after
the solar company told dealers it would no longer support new installations and was halting shipments. Surgery Partners (SGRY) rises 4% as the Bain Capital-backed chain of surgical facilities is exploring options including a potential sale.

European gauges fell as LSE Group’s (LSEG.L) Workspace news and data platform suffered an outage today that affected user access worldwide, causing disruption across financial markets.
The Stoxx Europe 600 index is lower for a fifth day with travel shares leading declines, while technology and healthcare outperform, but only making marginal gains. Disappointing earnings updates soured the mood. Sartorius AG plunged 13% after the German electronics
maker lowered full-year guidance. Computer-games maker Ubisoft Entertainment SA slid more than 8% after mixed full-year targets, while gaming firm Evolution AB also tumbled after its earnings missed estimates. UK retail sales fell 1.2% in June, double the
drop expected.  Stoxx 600 -0.4%, DAX -0.6%, CAC -0.5%, FTSE 100 -0.5%. Travel & Leisure -2%, REITS -2%, Basic Resources -2%. Tech +0.1%, Healthcare +1%.
LSE Group say technical issue impacting RNS data feed is now resolved (8:10EST).

Asian stocks declined amid concerns over geopolitics and China’s economy. MSCI’s Asia Pacific Index declined 1.3%, set for its biggest weekly drop in three months. In China, investors
were left disappointed over the lack of details provided on the implementation steps for achieving economic policy goals at the conclusion of its closely watched plenum on Thursday. Chinese officials on Friday acknowledged that the sweeping list of economic
goals contained “many complex contradictions”, pointing to a bumpy road ahead for policy implementation. Chinese blue-chips made gains, though the CSI300 Real Estate index slid about 2%, as an anemic property sector continued to weigh on China’s growth outlook.
Japan’s core CPI accelerated for a second month to 2.6% in June, a tad weaker than expected. Taiwan -2.25%, Hang Seng Index -2%, Kospi -1%, Sensex -0.9%, ASX 200 -0.8%, Vietnam -0.75%, Singapore -0.7%, Nikkei 225 -0.15%.

FIXED INCOME: 
 

Treasuries are little changed amid modest losses in most European bond markets. US 10-year yield is near flat on the day 4.20%; curve is roughly flat. US session
includes a couple of Fed speakers, no economic data.  

METALS: 

Gold fell for a third straight day, retreating from a record high of $2,483.60 per ounce hit earlier this week on the prospect of lower global interest rates. Despite
the recent pullback, gold ETFs saw a sixth straight day of inflows.  Chile was struck by a magnitude 7.4 earthquake, near the copper and lithium mining region of San Pedro de Atacama. Copper headed for its worst weekly loss in almost two years as a policy
meeting in China failed to lay out more stimulus to shore up metals demand.  Spot gold -1.4%, silver -2.7%.

ENERGY:   

Oil prices edged lower amid a broader move by markets to shun risk, but supply concerns kept the losses minimal. Wildfires are threatening about 400,000 barrels per
day of oil production in Canada and arid conditions are expected to exacerbate the situation in the coming days. A potential supply disruption from wildfires in Alberta boosted WTI’s prompt spread to the highest in almost nine months. Russia is yet to outline
its plan to cut output further to make up for overproduction. Meanwhile, major Russian commodity exporters are expressing difficult trading conditions with China. WTI -0.5%, Brent -0.3%, US Nat Gas -1.7%, RBOB -0.05%.

CURRENCIES:   

In currency markets, Sterling eased after data showed British retail sales volume fell by more than expected in June. The dollar edged higher, adding to yesterday’s
gains, after hitting a four-month low on Wednesday. The euro dipped for a second day after the ECB kept rates on hold as expected but left the door open to a September cut as it downgraded its view of the euro zone’s economic prospects. Japanese Finance Minister
Suzuki plans to present his views on various international topics, including FX markets, in Rio de Janeiro next week. The yen is roughly flat. US$ Index +0.1%, GBPUSD -0.15%, EURUSD -0.05%, USDJPY +0.04%, AUDUSD -0.1%, NZDUSD -0.3%, USDCHF +0.25%, USDNOK +0.4%.

Spot Bitcoin +0.2%, Spot Ethereum -0.5%.

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
• AnaptysBio (ANAB) Raised to Overweight at JPMorgan; PT $69
• ARM Holdings PLC (ARM) ADRs Raised to Overweight at Morgan Stanley
• Dada Nexus (DADA) ADRs Raised to Buy at BOCOM Intl; PT $1.70
• Marathon Oil (MRO) Raised to Overweight at Wells Fargo; PT $29
• Metro Inc (MRU CN) Raised to Buy at TD Cowen
• Owens & Minor (OMI) Raised to Buy at Citi; PT $19
• Wolverine World Wide (WWW) Raised to Buy at UBS; PT $20
• Downgrades
• Agenus (AGEN) Cut to Neutral at Baird; PT $8
• Bank of America (BAC) Cut to Neutral at Phillip Secs; PT $45
• Banner (BANR) Cut to Neutral at Janney Montgomery; PT $60
• Choice Hotels (CHH) Cut to Underweight at JPMorgan; PT $120
• Chuy’s Holdings (CHUY) Cut to Equal-Weight at Stephens; PT $37.50
• Cintas (CTAS) Cut to Neutral at Baird; PT $775
• Host Hotels (HST) Cut to Underweight at JPMorgan; PT $18
• Liberty Latin America (LILA) Cut to Sector Perform at Scotiabank
• Pentair (PNR) Cut to Neutral at Northcoast
• PepsiCo (PEP) Cut to Hold at DZ Bank; PT $183
• Sealed Air (SEE) Cut to Sector Perform at RBC; PT $40
• Triumph Financial Inc (TFIN) Cut to Underperform at KBW; PT $70
• Wheaton Precious Metals (WPM CN) Cut to Hold at Stifel Canada; PT C$90
• Wintrust Financial (WTFC) Cut to Market Perform at KBW; PT $115
• WNS Holdings Cut to Neutral at JPMorgan; PT $60
• Initiations
• Black Hills (BKH) Rated New Underperform at Baptista Research; PT $64
• California Resources (CRC) Resumed Buy at Citi; PT $63
• Canada Goose (GOOS CN) Rated New Outperform at Wedbush; PT C$21
• Columbia Sports (COLM) Rated New Neutral at Wedbush; PT $80
• Darden (DRI) Reinstated Neutral at Northcoast
• Discovery Silver Corp (DSV CN) Rated New Outperform at BMO; PT C$2
• Edison International (EIX) Rated New Hold at Baptista Research
• Greif (GEF) Rated New Market Perform at Raymond James
• Hive Digital Technologie (HIVE CN) Rated New Buy at B Riley; PT C$8.22
• Lilium (LILM) Rated New Overweight at Cantor; PT $2
• New Fortress Energy (NFE) Rated New Buy at Baptista Research
• New Jersey Resources (NJR) Rated New Underperform at Baptista Research
• New Mountain (NMFC) Rated New Market Perform at Raymond James
• ONE Gas (OGS) Rated New Underperform at Baptista Research; PT $63.90
• Ormat (ORA) Rated New Underperform at Baptista Research; PT $83.10
• Pinnacle West Capital (PNW) US Rated New Underperform at Baptista Research; PT $78.20
• Smurfit WestRock (SW) Rated New Overweight at Morgan Stanley
• Sonoco (SON) Rated New Outperform at Raymond James; PT $62
• Trupanion (TRUP) Rated New Outperform at William Blair
• UGI (UGI) Rated New Hold at Baptista Research; PT $28.90

Data sources: Bloomberg, Reuters, CQG