Cabrera Capital Daily Game Plan

Monday November 9, 2020                                                        Trading
Desk: (312) 236-8907

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

DATA/HEADLINES:   
1:00ET 3 Year Note Auction; 1:30ET Fed’s Mester speaks; 2:20ET Fed’s Harker speaks

The US labor market is expected to have extended its rebound last month, with the median estimate from economists projecting 593,000 positions
added in October. The unemployment rate is expected to have fallen to 7.6%.

TODAY’S HIGHLIGHTS:

• Covid-19 vaccine from Pfizer and BioNTech is strongly effective, early data from large trial indicate  
• PFIZER VACCINE PREVENTS 90% OF COVID INFECTIONS IN LARGE STUDY
  
• Pfizer and its German partner BioNTech are scaling up production, in hopes of having 50 million vaccine doses for 25 million people by the end of 2020, and
  1.3 billion doses in 2021, The Washington Post
• Novavax COVID-19 Vaccine Granted Fast Track Designation by U.S. FDA
• China holds off on sending congratulations to Biden
  

World stocks hit a record high as expectations of better global trade ties and more monetary stimulus under US President-elect Joe Biden supported
risk appetite. US COVID infections top 10 million, with new cases rising by 120,000 per day, as the third wave of the pandemic accelerates in major economies around the world. The crisis in Europe also appears to be intensifying, with Germany hitting a record
number of patients in intensive care. Stocks gained further this morning after news from Pfizer that its vaccine with German partner BioNTech prevents 90% of Covid infections in a large study. The companies said they have so far found no serious safety concerns
and expect to seek US emergency use authorization later this month.

EQUITIES: 
 

US equity futures powered higher as investors reacted to the likely Presidential victory for Democrat Joe Biden. S&P 500 futures rose overnight
as investors showed relief about the end of the election process and optimism over a possible split in Congress.  Pfizer’s announcement that its experimental vaccine was more than 90% effective in preventing COVID-19 pushed E-Mini S&P to a record high, up
more than 4%. Futures contracts on the Russell 2000 Index of small-cap stocks surged 7%. Stay-at-home stocks are plunging in pre-market trade, weighing on Nasdaq futures. Pfizer shares extended gains in premarket trading, rising about 7%. American depositary
receipts for BioNTech, which is also developing the vaccine, were up about 11%.

December E-mini S&P futures +4.3%, Nasdaq +0.6%, Russell 2000 futures +7% LIMIT, Dow futures +5.5%.

Nasdaq vs S&P 500 futures seem likely to test the 200dma in the pair

New all-time highs in Russell 2000 futures

European shares jumped as a victory for Joe Biden in the US presidential election raised hopes of better trade ties with Washington. The Stoxx
Europe 600 Index gained over 4% in a broad advance led by banks, travel, and autos. Renewable energy shares were also among top performers, while health care stocks lagged.  Every industry sector in Europe is higher. In company news, German chipmaker Infineon
gained 3.1% as it forecast a nearly 23% jump in revenue in the year ahead. British homebuilder Taylor Wimpey surged 11% after saying it was set to deliver annual results towards the upper end of expectations as the housing market recovered quicker than expected
from a coronavirus-led slump. Bank sector +9.4%, Oil & Gas +7.5%, Travel & Leisure +7%, Autos +6%. CAC +6.6%, Stoxx 600 +3.9%, DAX +5.2%.

Asian stocks gained, led by the materials and IT sectors. Japan’s Nikkei gained 2.1%, reaching a high last seen almost three decades ago, with
Honda Motors leading gains among carmakers on strong earnings figures. The broader Topix added 1.4%, and the Shanghai Composite Index rose 1.9%. Chinese motor sales continued to recover, with cars, SUVs and multi-purpose vehicles rising 8% from a year ago.
Indian markets closed at a record high with domestic IT stocks gaining after a report said the US President-elect planned to ease policy on work visas. The Nifty closed +1.61% and the Sensex index ended 1.68% higher. Hong Kong stocks ended at a four-month
high, +1.2%, as Democrat Joe Biden’s victory in the US presidential election raised hopes of a thaw in frosty Sino-American trade relations.

FIXED INCOME: 
 

Treasuries take another leg lower with 10-year yields topping at 0.93% after Pfizer report on vaccine study unleashed a surge in risk appetite
across markets.  Supply is also a factor as this week’s Treasury refunding begins with 3-year note sale at 1pm ET and a heavy IG corporate issuance slate is expected. Though off session highs, yields remain higher by nearly 10bp at long end, steepening 2s10s
by more than 7bp and 5s30s by nearly 5bp. 

METALS: 

Spot gold fell more than 2%, reversing earlier gains, on signs of progress in developing a Covid-19 vaccine. Pfizer said its vaccine was more
than 90% effective in preventing COVID-19 based on initial data from a large study, sending stock markets soaring and denting safe-haven bullion’s appeal.

ENERGY:  

Oil prices surged, benefiting from a risk-on stance after the US presidential election results. WTI crude futures extended earlier gains to rise
as much as 11% after news that a vaccine being developed by Pfizer and BioNTech prevented more than 90% of infections in a study of tens of thousands of volunteers. Prices also found some support after the Saudi oil minister said an OPEC+ deal on output cuts
could be adjusted to offset rising supply and weak demand. China, the world’s top crude importer, posted a 12% decline in October imports compared with September.

Crude Oil could see further upside momentum shift with a  close above the key 200 day moving averages

CURRENCIES:  

The dollar stabilized after hitting a 10-week low in the wake of Joe Biden’s election victory. The pound fluctuated ahead of a crucial week of
Brexit negotiations. The Australian dollar, which is sensitive to international trade developments and investors’ risk appetite, gained 1%. Turkey's lira, the world's worst performing emerging-market currency this year, jumped this morning in the wake of the
firing of the country's central bank governor on Friday and the resignation of the finance minister on Saturday.

TECHNICAL LEVELS: 
(futures)    

Colors within the report:
Green
is always the 200 period (day, week). Red is always 21,
Blue = 50,
Brown =
100  *Stars have added importance

Equity movers in early trading, as of 7:35am ET:

Advancers

• AMC +58.6% (+$1.46)
• CALT +51% (+$12.8)
• CUK +33.1% (+$3.94); Airlines, Property, Retail All Surge on Pfizer Vaccine News
• RETA +32.7% (+$43.1); Reata: Phase 3 Bardoxolone Met Primary, Key Secondary Endpoints
• PLAY +29.7% (+$5.50)
• CCL +28.4% (+$3.92); Airline Stocks Surge On Pfizer Vaccine Study; IAG Jumps 25%
• NCLH +25.5% (+$4.33); Airlines, Property, Retail All Surge on Pfizer Vaccine News
• AAL +24.3% (+$2.79); Airlines, Property, Retail All Surge on Pfizer Vaccine News (1)
• SIX +24% (+$6.01)
• SABR +22.2% (+$1.57)
• RCL +21.8% (+$12.8)
• SRG +21.4% (+$2.40)
• NCMI +20.8% (+$0.43)
• MTEM +20.6% (+$1.76)
• PRTY +20.5% (+$0.48); Party City Soars 25% After 3Q Adjusted EPS Beats Estimates
• CNK +20.3% (+$1.83); Peloton, Netflix Among At-Home Trades Lower After Vaccine News
• LIND +19.5% (+$1.58)
• HA +19.2% (+$2.66)
• EB +18.7% (+$1.89)
• AVXL +18.5% (+$0.91)
• GOL +18.5% (+$1.20)
• TGI +18.4% (+$1.40)
• MGM +18.2% (+$4)
• TLRY +18% (+$1.73); Tilray Soars in U.S. Pre-Market Trading; to Report After Close
• SAVE +17.6% (+$3.12)

Decliners

• BIIB -28.5% (-$93.9); Biogen Plunges After Alzheimer’s Blow, Analysts Downgrade
• ENLV -21.7% (-$2.50)
• QDEL -20.6% (-$58.4); Qiagen, Quidel Lead Covid Testmakers Lower After Pfizer Data
• ZM -13.4% (-$67.1); Peloton, Netflix Among At-Home Trades Lower After Vaccine News
• FLDM -12% (-$0.91)
• QGEN -11.3% (-$5.81); Infineon, K+S, DWS, Deutsche Boerse Gain Most: Tradegate Pre-Mkt
• NK -11.2% (-$0.91)
• HQY -11.2% (-$5.90)
• PTON -10.7% (-$13.5); John Hancock II – Capital Appreciation Adds Peloton Class A
• DRD -10.4% (-$1.42)
• ETSY -9.8% (-$14.3)
• W -7.9% (-$23.9)
• DOCU -7.4% (-$17.2)
• NLS -7% (-$1.95)
• INO -6.9% (-$0.73)
• FVRR -6.8% (-$12.9)
• GFI -6.8% (-$0.87)
• GRUB -6.5% (-$5.22)
• PINS -6.4% (-$4.14)
• OSTK -6.3% (-$4.23)
• FTCH -5.8% (-$2.48); Richemont JV with Alibaba and Farfetch to Improve Sentiment: RBC
• NVAX -5.7% (-$5.11); Novavax Sinks, Moderna Climbs After Positive Pfizer Vaccine Data

David Wienke

Cabrera Capital Markets, LLC