Daily Game Plan

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

DATA/HEADLINES:    PPI Revisions – 9:30ET Fed’s Goolsbee speaks; 4:00ET Fed’s Barr speaks

TODAY’S HIGHLIGHTS and News:  

• Democrats pick up seat in US House as Suozzi wins in New York
• Jeff Bezos offloaded more than $4 billion in Amazon stock over four trading days
• Coca-Cola is said to be interested in buying healthy soda brand Poppi
  
• Bitcoin regains $1 trillion market cap
  

World shares get a bit of a rebound from Tuesday’s Wall Street slump triggered by hotter-than-expected US inflation data that fueled bets the Federal Reserve may
not cut interest rates as soon as expected.  Better news today in Europe helped calm global markets a touch. Inflation in Britain came in lower than forecast in January, with underlying price pressures not rising as much as markets and the BOE feared.  Headline
CPI was 4.0% in Jan, in line with December. Services inflation rose to 6.5% from 6.4% in December but was not as strong as the BoE had expected.    

EQUITIES: 
 

US equity futures ticked higher after the worst inflation-day drop for the SP 500 index since September 2022.  US stocks were poised to recover from their Tuesday selloff as market focus
shifted from concerns about sticky inflation and the timing of interest-rate cuts to the positive economic and earnings outlook. LYFT shares went on a wild ride overnight after a typo that initially helped send the stock up as much as 67% in after-market trading
on Tuesday. The company issued a massive correction to its outlook for earnings margin in 2024, saying its margin is expected to expand by 50 basis points — not the 500 basis points written into an earnings presentation.

Futures ahead of the bell: E-Mini S&P +0.6%, Nasdaq +0.7%, Russell 2000 +1.4%, DJI +0.4%    

In pre-market trading, Lyft (LYFT) jumped 20% after the ride-sharing company reported fourth-quarter results that beat expectations on key metrics and gave an outlook that is above consensus.
QuidelOrtho (QDEL) shares plummet 37% after the diagnostics company issued full-year forecast that missed expectations. Robinhood (HOOD) jumped 14% after the online brokerage firm reported fourth-quarter net revenue that beat estimates. Airbnb (ABNB) fell
5% after the home-rental company reported its fourth-quarter results and gave an outlook. Cryptocurrency-linked stocks rally as Bitcoin shows resilience to the higher-than-expected US inflation print. Marathon Digital (MARA) +11%, Riot Platforms (RIOT) +8.5%,
Coinbase Global (COIN) +7.5%. Instacart (CART) shares fall 3% after the online grocery delivery firm reported fourth-quarter revenue that missed expectations. MGM Resorts (MGM) fell 3% as the drop in the revenue from regional business dragged on overall quarterly
results. Upstart (UPST) shares dropped 20% after its guidance for the first quarter disappointed. Vizio (VZIO) dips 2.5%, ceding some of the previous day’s 25% surge triggered by a Wall Street Journal report that Walmart is in talks to buy the TV maker. Uber
(UBER) gains 6% after unveiling a buyback plan totaling as much as $7 billion in shares.  

European gauges advanced after Tuesday’s slide, while the UK benchmark outperforms following data that showed consumer prices rose less than forecast in January. In individual stock moves,
Heineken NV slumped 5%, dragging on the food and beverage subgroup after it warned that persistent inflation and economic worries will hurt beer demand in 2024. Thyssenkrupp AG fell 8% after cutting its sales and profit outlook. ABN Amro Bank NV rallied over
5% after it unveiled a fresh share buyback with the Dutch state participating.  Capgemini jumped 5% after the French IT firm said its sales growth is expected to reach a trough in the first quarter as demand for tech projects recovers. Vodafone gained over
5% after a Betaville mention. Stoxx 600 +0.5%, DAX +0.4%, CAC +0.6%, FTSE 100 +0.95%. Media and Retail +1.1%, Banks +0.9%, Financial Services +0.8%. Food & Bev and Basic Resources -0.3%.

Markets in Asia were mixed, although gauges trimmed early losses with Chinese shares listed in Hong Kong gaining as trading resumed after holidays. The MSCI Asia Pacific Index fell 0.4%,
paring a more than 1% drop as technology stocks gained. Key gauges fell more than 1% in Japan and South Korea, with losses also notable in Australia and New Zealand. Markets remained shut for holidays in mainland China and Taiwan, while Indonesia was closed
for its presidential election. Macau casino shares gained after Citi said the city saw a “strong start” to the Chinese new year holiday week. Hang Seng Tech +2.25%, Hang Seng Index +0.8%, Sensex +0.4%. Kospi -1.1%, Topix -1%, ASX 200 -0.7%, Singapore -0.1%.

FIXED INCOME: 
 

Treasury yields retraced some of the previous day’s surge, as traders trimmed bets for an early Fed rate cut.  Fed swaps shifted full pricing of a rate cut to July
from June after the CPI data. Treasuries hold a bull-steepening bias heading into early US session with front-end yields richer by as much as 5bp on the day. Move follows a front-end-led rally in gilts after UK consumer prices rose less than expected in January.
US session includes two scheduled Fed speakers and no major economic data. US 10-year yields around 4.3%. 2s10s spread is steeper by ~2.5bp.

METALS: 
   

Gold was locked in a narrow range after plunging below $2,000 an ounce for the first time in two months following yesterday’s stronger-than-expected US inflation
data. Global gold-backed exchange-traded fund holdings are at their lowest since January 2020 due to recent outflows. Gold has retreated from December’s record as the prospect of rapid rate cuts by the Federal Reserve has faded, with traders now seeing just
a 32% chance of a reduction in May. The market’s focus now shifts to upcoming US retail sales data and producer price index numbers. Gold -0.1%, Silver -0.4%.

ENERGY:  

Oil steadied after a mixed US inventory report, while OPEC and the IEA offered contrasting outlooks for the global crude market. US gasoline and distillate fuel stockpiles
plunged, according to API, while US crude oil inventories rose much more than expected.  Official inventory data from the EIA is due later today.  A push to replenish depleted oil stocks notably in China, the United States and Europe could buoy demand and
prices in coming months, analysts said, as tensions in the Middle East threaten key shipping lanes. Global output of fuel products is set to drop to the lowest this year in the March-to-May period due to refinery maintenance, according to Rystad. WTI +0.05%,
Brent +0.15%, US Nat Gas -1.5%, RBOB -0.3%.

CURRENCIES:   

In currency markets, the dollar index slightly weakened as the market digests the recent US CPI report. The yen weakened past 150 per dollar for the first time since
November, prompting pushback from Japanese officials. Japan’s top currency diplomat Masato Kanda said the nation would take appropriate action on forex if needed.  Sterling fell after UK data showed inflation did not pick up as expected last month, prompting
traders to increase bets on Bank of England interest-rate cuts. US$ Index -0.1%, GBPUSD -0.2%, USDJPY -0.15%, EURUSD +0.01%, AUDUSD +0.5%, NZDUSD +0.4%.

Bitcoin +4%, Ethereum +4%. Bitcoin regains $1 trillion market cap as the cryptocurrency hits over two-year high.   

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
• Adicet Bio Inc (ACET) Raised to Buy at JonesTrading; PT $6
• Bruker Corp (BRKR) Raised to Overweight at JPMorgan; PT $90
• Citigroup (C) Raised to Overweight at Piper Sandler; PT $63
• HP Inc (HPQ) Raised to Buy at HSBC; PT $33
• Lyft (LYFT) Raised to Neutral at MoffettNathanson LLC
• NBT Bancorp (NBTB) Raised to Overweight at Stephens; PT $42
• SentinelOne (S) Raised to Buy at BofA; PT $35
• Downgrades
• Biogen (BIIB) Cut to Equal-Weight at Wells Fargo; PT $240
• BlackLine Inc (BL) Cut to Market Perform at William Blair
• CymaBay (CBAY) Cut to Market Perform at LifeSci Capital; PT $32.50
• Cut to Neutral at Piper Sandler
• Ecolab (ECL) Cut to Neutral at JPMorgan; PT $220
• GlobalFoundries (GFS) Cut to Neutral at Citi; PT $56
• GoDaddy (GDDY) Cut to Inline at Evercore ISI; PT $110
• Incyte (INCY) Cut to Market Perform at JMP
• MacroGenics (MGNX) Cut to Neutral at HC Wainwright; PT $14
• Neighbourly Pharmacy (NBLY CN) Cut to Sector Perform at RBC; PT C$18.50
• NXP Semi (NXPI) Cut to Neutral at Fubon; PT $227
• Palantir (PLTR) Cut to Hold at HSBC; PT $22
• Pure Storage (PSTG) Cut to Hold at Stifel; PT $41
• QuidelOrtho (QDEL) Cut to Outperform at Raymond James
• Cut to Market Perform at William Blair
• Cut to Underweight at JPMorgan; PT $37
• SSR Mining (SSRM CN) Cut to Sector Perform at Scotiabank; PT C$12
• Tecnoglass (TGLS) Cut to Hold at Stifel; PT $45
• Twilio (TWLO) Cut to Reduce at HSBC; PT $61
• Ulta Beauty (ULTA) Cut to Hold at Loop Capital; PT $530
• Whole Earth (FREE) Cut to Hold at Canaccord; PT $4.88
• Initiations
• CG oncology (CGON) Rated New Buy at HC Wainwright; PT $75
• Dream Impact Trust (MPCT-U CN) Rated New Hold at Desjardins; PT C$7
• Enphase Energy (ENPH) Rated New Outperform at RBC
• First Solar (FSLR) Rated New Outperform at RBC; PT $195
• ONE Gas (OGS) Reinstated Neutral at Ladenburg Thalmann; PT $58
• Pinnacle West Capital (PNW) Rated New Neutral at Ladenburg Thalmann
• Shoals Technologies (SHLS) Rated New Outperform at RBC
• SolarEdge (SEDG) Rated New Sector Perform at RBC
• Steven Madden (SHOO) Rated New Neutral at Piper Sandler; PT $45
• Sylogist (SYZ CN) Rated New Buy at Paradigm Capital; PT C$12
• TKO (TKO) Rated New Equal-Weight at Morgan Stanley; PT $95
• Wingstop (WING) Rated New Outperform at Bernstein; PT $340

Data sources: Bloomberg, Reuters, CQG