Daily Game Plan

by Contributor
on December 6, 2024

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

TODAY’S ECONOMIC DATA:  8:30ET Unemployment Report*, 9:15ET Fed’s Bowman speaks; 10:00ET U. of Mich. Sentiment;
10:30ET Fed’s Goolsbee speaks; 12:00ET Fed’s Hammack speaks; 1:00ET Fed’s Daly speaks; 3:00ET Consumer Credit

Highlights and News:  

  • Chinese Stocks Jump Ahead of Key Meeting on Stimulus Bets
  • ECB to Cut Faster in Bid to Revive Flagging Economy, Bloomberg Poll Shows
  • IRAN FULLY PREPARED TO SUPPORT SYRIA AS NECESSARY: MINISTER
  • CHINA’S ECONOMIC CONTROLS TO BE TARGETED, EFFICIENT: XINHUA
  • The Israeli military says it is “reinforcing aerial and ground forces” in the occupied Golan Heights in response to sweeping advances by opposition forces in Syria

 

World stocks edge higher as investors continue to assess political volatility in Europe and Asia and await US nonfarm payroll data that may help shape the Federal
Reserve’s future policy path.  Investors are betting that Chinese authorities will offer fresh measures to support growth at the Central Economic Work Conference next week. Meanwhile, French President Macron said he will appoint a new prime minister in the
coming days whose top priority will be getting a 2025 budget adopted. Tensions remained in South Korea where the ruling party leader said President Yoon Suk Yeol needed to be removed from power.  Global equity funds saw a notable rise in inflows in the week
through Dec. 4, despite political turmoil in France and South Korea. By sector, financials and industrials drew the most, while healthcare and technology sectors saw outflows. Bond funds saw their first weekly inflow in seven weeks.     

 

EQUITIES:  

US equity futures fluctuated in narrow ranges as the November payrolls report holds all the attention today. Analysts anticipate the report will show payrolls increased by 200,000 jobs
in November after October’s hiring was damped by devastating hurricanes and a major strike. There is also a slew of Fed speakers throughout the day. Investor buying of US equities continued for the ninth consecutive week, with inflows into small caps specifically
ballooning to a record high, BofA said in their report. Bank of America strategist Michael Hartnett said that powerful rally in US stocks as well as cryptocurrencies has left the asset classes looking frothy.

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

In pre-market trading, Asana (ASAN) surges 25% after the provider of a software tool used by project managers posted a quarterly revenue beat. DocuSign (DOCU) gains 13% after the maker
of electronic-signature software boosted its revenue forecast for the full year. Gitlab (GTLB) rises 9% after the software development platform posted strong 3Q results. Lululemon (LULU) surges 9% after the company edged up its full-year outlook on strong
sales overseas. Petco (WOOF) rises 5% after the pet health and wellness company posted 3Q comparable sales that beat expectations. Rubrik (RBRK) gains 23% after the data management company boosted its full-year revenue guidance. Smith & Wesson Brands (SWBI)
falls 13% after 2Q results. Ulta Beauty (ULTA) jumps 11% after the cosmetics retailer increased its annual projections. Veeva Systems (VEEV) rises 7% after the health-care software company boosted its full-year earnings forecast. Victoria’s Secret (VSCO) gains
4% after raising its outlook and reporting third-quarter sales that topped estimates.

French stocks lead Europe higher as French President Macron meets with key politicians in an effort to cobble together a new administration. The CAC 40 index climbed
more than 1%, rising for a seventh day in the longest winning streak in almost 10 months.  Private consumption in the euro area jumped by the most in two years in the third quarter, offering hope that shoppers are finally starting to power an economic recovery.
In corporate news, Direct Line Insurance Group was among the top movers, rallying as much as 8.5% after Aviva reached a preliminary agreement to acquire the UK motor insurer.  Barclays analysts predict better performance next year should French political risks
ease and the ECB opens the door to more interest-rate cuts. A catch-up with Wall Street is under way, they told clients.  Stoxx 600 +0.3%, DAX +0.2%, CAC +1.5%, FTSE 100 ~flat. Personal Goods +1.7%, Autos +1.6%, Real Estate +0.7%. Basic Resources -0.2%.

Shares in Asia were mixed with the MSCI Asia Pacific Index little changed after erasing a loss of as much as 0.5%. Hong Kong and mainland China stocks jumped to the
highest level in two weeks on hopes for further stimulus to be released at a key policy meeting next week. Expectations are rising among Wall Street banks that the PBOC will deliver the biggest interest-rate cuts in a decade next year. The CSI 300 Index rose
1.3%, led by gains in financial and technology shares. South Korea was another focal point, with the Kospi index falling as much as 1.8% before paring the drop after the nation’s Army Special Forces Commander said there will be no second martial law. Stocks
in India were steady after the central bank kept borrowing rates unchanged but unexpectedly cut its cash reserve ratio requirement by 50bps. Japanese and Australian equities tracked US peers lower. Hang Seng Tech +2.2%, Hang Seng Index +1.6%, Shanghai Composite
+1%, Indonesia +1%, Philippines +0.6%, Vietnam +0.2%. Sensex -0.1%, Taiwan -0.3%, Kospi -0.55%, ASX 200 -0.6%, Nikkei 225 -0.8%.

FIXED INCOME: 
 

Treasuries are mixed in early US session, extending Thursday’s curve-flattening move. Front-end yields are 1bp-2bp cheaper on the day with long-end slightly richer,
amid similar price action in core European bonds. Ahead of the jobs report, Fed futures remain uncertain about another rate cut this month and price just a 65% chance of a move. The 30-year yield fell to 6-week lows of 4.31%, flattening the 2s30s to the lowest
level since August. French bonds outperform after National Rally leader Marine Le Pen said Thursday that a budget could be delivered in weeks.

 

METALS: 

Gold prices edged higher but are poised for a second straight weekly decline as investors remained cautious ahead of the US non-farm payrolls data that could shape
the Federal Reserve’s rate cut path.  Nonfarm payrolls are the next major data release before policymakers meet Dec. 17-18. After six consecutive months of inflows, global physically backed gold exchange-traded funds registered outflows in November, the World
Gold Council said on Thursday.  Spot gold +0.2%, Silver -0.5%, Copper +0.9%.

 

 

ENERGY:   

 

Oil prices are lower, trading in a tight range despite OPEC+’s decision to push back a series of supply increases. The move by OPEC+ to delay a revival of supply
to April will pare global oil output next year, tightening balances somewhat, but a glut is still widely expected, according to banks and industry consultants. The global oil market faces a “heavy surplus” of more than 1 million b/d next year, Macquarie said.
Non-OPEC supply growth is expected to meet the below-trend demand growth.  WTI -0.7%, Brent -0.7%, US Nat Gas -2%, RBOB -0.6%.

 

CURRENCIES: 

In currency markets, the euro is little changed, the yen drops while the kiwi and Aussie$ are the weakest of the G-10’s. Some strategists suggest the declines are
due to President-elect Trump’s choice of a China hawk to be his ambassador to the nation. Modest gains in the dollar put the greenback on course to rise for the ninth week out of the last 10.  BofA is Wall Street’s biggest pound bull, pushing a 2025 forecast
that sees the currency hitting its highest level against the euro since 2016 and surging 8% versus the dollar.  US$ Index +0.05%, GBPUSD +0.1%, EURUSD -0.03%, USDJPY +0.2%, AUDUSD -0.5%, NZDUSD -0.6%, USDCHF -0.2%, USDCAD +0.2% 

 

 

Spot Bitcoin -1%, Spot Ethereum +0.5%. Bitcoin falls 1%, having failed to sustain a break above $100,000. BofA’s Hartnett said that with a market capitalization of
over $2 trillion, the digital asset was comparable in size to the 11th largest economy in the world.

 

 

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
    • Accenture (ACN) Raised to Buy at Goldman; PT $420
    • Altria (MO) Raised to Buy at BofA
    • Asana (ASAN) Raised to Sector Weight at KeyBanc
    • Bank of Montreal (BMO CN) Raised to Outperform at CIBC; PT C$150
      • Raised to Sector Outperform at Scotiabank
    • Brixmor Property (BRX) Raised to Outperform at BMO; PT $33
    • Dollar General (DG) Raised to Buy at BofA
    • EPAM Systems (EPAM) Raised to Buy at Goldman; PT $295
    • Kingsoft Cloud (KC) ADRs Raised to Buy at UBS; PT $12.50
    • Molson Coors (TAP) Raised to Buy at BofA; PT $70
    • Peloton (PTON) Raised to Neutral at UBS; PT $10
    • Piedmont Lithium (PLL) Raised to Outperform at Macquarie; PT $13.50
    • PJT Partners (PJT) Raised to Neutral at UBS
    • Potlatch (PCH) Raised to Outperform at BMO; PT $51
    • ProPetro (PUMP) Raised to Neutral at JPMorgan; PT $10
    • Republic Services (RSG) Raised to Outperform at BMO; PT $238
    • Shopify (SHOP CN) Raised to Buy at Loop Capital; PT $140
    • SiteOne Landscape (SITE) Raised to Buy at Jefferies; PT $175
    • TechnipFMC (FTI) Raised to Buy at Jefferies; PT $40
    • Timken (TKR) Raised to Buy at Jefferies; PT $95
    • Transocean (RIG) Raised to Neutral at JPMorgan; PT $5
    • WesBanco (WSBC) Raised to Strong Buy at Raymond James
    • Weyerhaeuser (WY) Raised to Outperform at BMO; PT $38
  • Downgrades
    • Canfor (CFP CN) Cut to Market Perform at BMO; PT C$20
    • Deere (DE) Cut to Hold at Jefferies; PT $510
    • Duckhorn Portfolio (NAPA) Cut to Hold at Jefferies; PT $11
    • EQB Inc (EQB CN) Cut to Hold at TD Cowen; PT C$110
    • Fortrea (FTRE) Cut to Neutral at Baird; PT $25
    • Frontier (FYBR) Cut to Hold at Benchmark
    • Kennametal (KMT) Cut to Hold at Jefferies; PT $32
    • Mainstreet Equity (MEQ CN) Cut to Sector Perform at ATB Capital; PT C$220
    • ONE Gas (OGS) Cut to Neutral at Ladenburg Thalmann; PT $75.50
    • Paccar (PCAR) Cut to Hold at Jefferies; PT $120
    • ProFrac Holding (ACDC) Cut to Underweight at JPMorgan; PT $7
    • Prologis (PLD) Cut to Underperform at BMO; PT $104
    • TD Bank (TD CN) Cut to Sector Perform at Scotiabank; PT C$81
      • Cut to Hold at Desjardins; PT C$80
    • XPeng (XPEV) ADRs Cut to Sell at UBS
  • Initiations
    • Abercrombie & Fitch (ANF) Rated New Outperform at Raymond James
    • BioHarvest Sciences Inc (BHSC CN) Rated New Buy at HC Wainwright
    • Boston Beer (SAM) Rated New Hold at Needham
    • Brown-Forman (BF/B) Rated New Hold at Needham
    • CBRE (CBRE) Rated New Buy at Goldman
    • Celsius Holdings (CELH) Rated New Buy at Needham; PT $38
    • CervoMed Inc (CRVO) Rated New Buy at Roth Capital Partners; PT $45
    • CI&T Inc (CINT) Rated New Buy at TD Cowen; PT $9
    • Clean Harbors (CLH) Rated New Buy at TD Cowen; PT $325
    • Colliers International (CIGI CN) Rated New Neutral at Goldman; PT C$239
    • Conoco (COP) Resumed Outperform at Evercore ISI; PT $165
    • Constellation Brands (STZ) Rated New Buy at Needham; PT $280
    • CSW Industrials (CSWI) Rated New Neutral at Goldman; PT $450
    • Cushman & Wakefield (CWK) Rated New Sell at Goldman
    • Entrada Therapeutics (TRDA) Rated New Buy at Roth Capital Partners
    • EQT Corp (EQT) Rated New Market Perform at Bernstein; PT $50
    • Gain Therapeutics (GANX) Rated New Buy at Roth Capital Partners; PT $7
    • Haemonetics (HAE) Rated New Overweight at JPMorgan; PT $116
    • IGM Biosciences (IGMS) Rated New Outperform at BMO; PT $21
    • Jasper Therapeutics (JSPR) Reinstated Outperform at BMO; PT $63
    • Jones Lang (JLL) Rated New Buy at Goldman
    • Kymera (KYMR) Rated New Market Perform at BMO; PT $55
    • LegalZoom (LZ) Rated New Neutral at UBS; PT $9
    • Longeveron (LGVN) Rated New Buy at Roth Capital Partners; PT $10
    • Mach Natural Resources (MNR) Rated New Buy at Truist Secs; PT $23
    • Mereo Biopharma (MREO) ADRs Rated New Buy at Jefferies; PT $7
    • Molson Coors (TAP) Rated New Buy at Needham; PT $72
    • Monster Beverage (MNST) Rated New Hold at Needham
    • N-able (NABL) Rated New Sector Perform at Scotiabank
    • National Energy Services (NESR) Rated New Overweight at JPMorgan
    • Newmark (NMRK) Rated New Buy at Goldman
    • Noble Corp. (NE) Reinstated Neutral at JPMorgan; PT $37
    • Nurix (NRIX) Rated New Outperform at BMO; PT $35
    • Protagonist Therapeutics (PTGX) Rated New Neutral at Goldman; PT $47
      • Rated New Outperform at BMO; PT $62
    • Q32 Bio Inc (QTTB) Rated New Outperform at BMO; PT $64
    • Sagimet Biosciences (SGMT) Rated New Outperform at Oppenheimer; PT $30
    • Sotera (SHC) Reinstated Neutral at Goldman; PT $14
    • Summit Therapeutics (SMMT) Rated New Buy at Jefferies; PT $31
    • Torrid (CURV) Resumed Buy at BofA; PT $5
    • Tourmaline Bio Inc (TRML) Rated New Outperform at BMO; PT $50
    • Valaris (VAL) Rated New Underweight at JPMorgan; PT $40
    • Vtex (VTEX) Rated New Neutral at Citi; PT $6.70

 

 

 

 

 

 

Data sources: Bloomberg, Reuters, CQG

 

 

David Wienke

Categories:

Charts

Tags:

aucldxesngqqqsp500tyusdvixwtiX

Comments are closed