Daily Game Plan

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

TODAY’S ECONOMIC DATA:  none

Happy Veterans Day

Highlights and News:  

• JAPAN TO PROPOSE $65B PLAN TO AID DOMESTIC CHIP INDUSTRY: RTRS
• CONGRESS MAY EXTEND GOVT. SHUTDOWN DEADLINE TO MARCH: WAPO
• The US has ordered TSMC to halt shipments of advanced AI chips to China from Monday
• Russia Denies Trump Warning Over Ukraine
  

World stocks are higher ahead of a busy week packed with global economic data, including inflation readings in Germany and the United States. Data out of China released
over the weekend showed anemic consumer inflation in October while producer prices continued falling, indicating government stimulus has been insufficient to pull the economy out of deflation. Producer inflation slid for a 25th straight month, with a 2.9%
drop on the year, more than the 2.5% decrease predicted by economists. Bank of Japan board members discussed the need for caution on raising its benchmark rate and offered no clear hint of a move next month, a summary of opinions from its October policy meeting
showed.  Taiwan is considering large US defense purchases as an overture to the incoming Trump administration, the FT reported.    

EQUITIES:  

US equity futures are higher, building on their recent advance to record highs as Donald Trump’s victory stoked investors’ appetite for US assets. The S&P 500 hit its 50th record high
of the year on Friday. Russell 2000 leads gains overnight while investors await inflation data due Wednesday for clues on the Federal Reserve’s interest-rate trajectory. Small caps are expected to be a key beneficiary of President-elect Trump’s proposed tax
cuts and expectations of an easier regulatory environment. Stocks may struggle to sustain their rally beyond year-end if benchmark US yields approach 5%, JPMorgan said. Its strategists expect small caps to outperform. Julius Baer raised financials to overweight
on the prospect of higher yields.

Futures ahead of the bell: E-Mini S&P +0.4%, Nasdaq +0.4%, Russell 2000 +1.2%, DJI +0.4%. 

In pre-market trading, Tesla surged more than 7% after touching $1 trillion in market value on Friday for the first time since 2022. Cigna (CI) climbs 7% after saying it won’t pursue
a combination with rival insurer Humana Inc. after reports the two companies had renewed discussions over a deal. Humana (HUM) share slip 6%. Cryptocurrency-exposed stocks gain as Bitcoin rallies past $81,000 for the first time. Monday.com (MNDY) tumbles 13%
after the software company reported third-quarter results. RadNet (RDNT) climbs 17% after the operator of outpatient diagnostic imaging centers said it’s in a pact with GE Healthcare to promote AI in imaging. Sapiens (SPNS) drops 22% after the application-software
company posted 3Q revenue that trailed Wall Street expectations and lowered its outlook for the full year.

European gauges are sharply higher, attempting to rebound after three straight weeks of declines that were driven by concerns over the possibility of US trade tariffs. The Stoxx 600 index
rebounded over 1%, with all industry groups in the green, as sentiment was lifted by a slew of robust company earnings, including German tiremaker Continental AG and insurance firm Hannover Re.  Natwest Group rose after the lender bought back £1 billion ($1.29
billion) of its shares from the UK government. Delivery Hero SE’s shares also advanced after the food delivery firm unveiled plans to list its Talabat unit in Dubai. Politics remained a headwind in Europe as German Chancellor Olaf Scholz said he would be willing
to call a vote of confidence before Christmas, paving the way for snap elections. Stoxx 600 +1.2%, DAX +1.4%, CAC +1.2%, FTSE 100 +0.7%. Construction +2%, Industrials +1.7%, Chemicals +1.6%, Technology +1.4%.

Shares in Asia fell by the most in a month as Beijing’s latest economic measures disappointed the market, and soft China inflation data signaled that recent efforts
to spur economic growth have not been enough. The MSCI Asia Pacific Index fell as much as 1.3% before trimming some losses to 0.9%. Samsung Electronics was among the biggest drags alongside Chinese megacaps Tencent and Meituan. Taiwan Semiconductor Manufacturing
Co. saw its shares dip after reports that the US government requested it halt some shipments of advanced AI-related chips to China. Hong Kong stock led losses in the region, while China’s CSI 300 benchmark fell as much as 1.4% before erasing losses to close
higher on the day. Hang Seng Index -1.4%, Kospi =1.1%, Thailand -0.6%, Philippines -0.5%, ASX 200 -0.3%, Vietnam -0.2%, Taiwan -0.1%, Topix -0.1%. Sensex was flat. Nikkei +0.1%, Singapore +0.4%, CSI 300 +0.65%.

FIXED INCOME: 
 

Treasury futures opened down in Asia and have broadly held losses, leaving the 10-year tenor lower by around 9 ticks on the day. There is no cash Treasuries trading
due to a US holiday, but the drop in futures points to a 10-year yield that’s roughly 5 basis points higher than Friday’s closing levels. JPMorgan said it revised its US terminal rate forecasts to 3.5% from 3% and expected one 25 bps Fed cut every quarter,
starting from December. The Fed’s Neel Kashkari said policymakers want to be confident inflation is heading “all the way back” to the 2% target. He also said a strong economy may lead the Fed to cut rates less than previously expected. 

METALS: 

Gold dropped, after a volatile week which saw prices whipsaw as the dollar surged in the wake of Donald Trump’s election win a day before the Federal Reserve cut
interest rates. The precious metal received support from US central bank easing, but was buffeted as investors weighed the likely impact of the tax cuts, trade tariffs and looser regulations that Trump is pledging. Economists now see fewer Fed cuts than they
did before the election, which is a negative for gold. Spot gold -1%, Silver -0.7%, Copper -0.9%.

ENERGY:   

Oil prices fell after China’s latest efforts disappointed markets and as concerns about potential supply disruptions from storm Rafael in the US Gulf of Mexico subsided.
Oil is extending its biggest drop in almost two weeks as a soft outlook in top importer China continued to plague the market. Crude traders have been assessing the outlook for global demand heading into 2025, as well as the implications stemming from Donald
Trump’s election. With a surplus widely expected next year, investors will get a slew of influential outlooks this week, starting with the view from OPEC on Tuesday. Trump may exempt Canadian crude from tariffs, former US Commerce Secretary Wilbur Ross told
the CBC. WTI -2.1%, Brent -1.8%, US Nat Gas +7.3%, RBOB -1.9%.

CURRENCIES: 

In currency markets, the dollar firmed as traders prepared for a key reading of US consumer inflation this week, as well as a parade of Federal Reserve speakers including
Chair Jerome Powell on Thursday. The euro hit a 4-1/2-month low against the dollar as investors worried about possible US tariffs which would hurt the euro area’s economy. ECB Governing Council member Robert Holzmann said a December interest-rate cut is a
possibility but by no means guaranteed. The yen slid after a summary of opinions from the Bank of Japan’s October policy meeting showed some members were unsure on when to raise rates. The lack of a clear steer on the likelihood of a rate hike in December
or January will keep BOJ watchers guessing over the timing of the central bank’s next move. US$ Index +0.5%, GBPUSD -0.3%, EURUSD -0.6%, USDJPY +0.8%, AUDUSD -0.05%, NZDUSD -0.1%, USDNOK +0.6%, USDCHF +0.5%.

Spot Bitcoin +2.3%, Spot Ethereum -0.4%. Bitcoin rallied past $82,000 for the first time, on the prospect of a Republican-led Congress with pro-crypto lawmakers.
Bullish sentiment lifted smaller coins too, including Dogecoin. Coinbase Global jumped over 16% and bitcoin miners Mara Holdings and Riot Platforms gained 19% and 13%, respectively.

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
• Akamai (AKAM) Raised to Buy at HSBC; PT $121
• Cboe (CBOE) Raised to Buy at Deutsche Bank; PT $222
• Cisco (CSCO) Raised to Overweight at JPMorgan
• EPAM Systems (EPAM) Raised to Sector Outperform at Scotiabank; PT $275
• Mercury Systems (MRCY) Raised to Hold at Jefferies; PT $42
• Netstreit (NTST) Raised to Sector Outperform at Scotiabank; PT $18
• Orion SA (OEC) Raised to Overweight at JPMorgan; PT $21
• Ouster (OUST) Raised to Overweight at Cantor; PT $10
• Pinterest (PINS) Raised to Outperform at Wedbush; PT $38
• Qualys (QLYS) Raised to Peerperform at Wolfe
• Stantec (STN CN) Raised to Buy at Canaccord; PT C$135
• Tanger Inc (SKT) Raised to Buy at BofA; PT $40
• Universal Electronics (UEIC) Raised to Buy at B Riley; PT $14
• Upstart (UPST) Raised to Neutral at BTIG
• Valley National (VLY) Raised to Overweight at JPMorgan; PT $11
• Warner Bros Discovery (WBD) Raised to Peerperform at Wolfe
• Winnebago Industries (WGO) Raised to Buy at Northcoast; PT $75
• Downgrades
• Agilon Health (AGL) Cut to Market Perform at JMP
• Arcadium Lithium (ALTM) Cut to Sector Perform at Scotiabank; PT $5.85
• Ardelyx (ARDX) Cut to Neutral at HC Wainwright; PT $5.50
• Atmus Filtration (ATMU) Cut to Equal-Weight at Wells Fargo; PT $45
• Bloomin’ Brands (BLMN) Cut to Market Perform at Raymond James
• Cabot Corp (CBT) Cut to Underweight at JPMorgan; PT $105
• Celanese (CE) Cut to Underperform at BMO; PT $76
• Docebo (DCBO CN) Cut to Sector Perform at ATB Capital; PT C$75
• GCM Grosvenor (GCMG) Cut to Hold at TD Cowen; PT $12.50
• Immunocore (IMCR) ADRs Cut to Neutral at Mizuho Securities
• Lassonde Industries (LAS/A CN) Cut to Sector Perform at National Bank
• Merck & Co (MRK) Cut to Neutral at Daiwa; PT $100
• Nerdy (NRDY) Cut to Underweight at JPMorgan
• NOV Inc (NOV) Cut to Neutral at Citi; PT $18
• NVR (NVR) Cut to Neutral at Seaport Global Securities
• Osisko Gold Royalties (OR CN) Cut to Hold at TD Cowen
• ProAssurance (PRA) Cut to Neutral at Piper Sandler; PT $18
• Smartsheet (SMAR) Cut to Neutral at Guggenheim
• Tempus AI (TEM) Cut to Hold at Stifel; PT $65
• Tidewater (TDW) Cut to Outperform at Raymond James; PT $102
• WhiteHorse Finance (WHF) Cut to Market Perform at Oppenheimer; PT $12
• Xeris Biopharma (XERS) Cut to Neutral at Piper Sandler; PT $3
• Initiations
• AMD (AMD) Rated New Market Perform at CICC; PT $155
• Evry (EVRY NO) TriSalus Life Sciences Rated New Buy at Roth Capital Partners
• RXO (RXO) Reinstated Equal-Weight at Wells Fargo; PT $31
• Stellantis (STLA) Rated New Inline at Evercore ISI; PT $13.92

Data sources: Bloomberg, Reuters, CQG

David Wienke