Daily Game Plan

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

DATA/HEADLINES:  9:45ET S&P Global US Services PMI, Composite PMI; 10:00ET Factory Orders, Durable Goods, Cap Goods,
ISM Services;  12:00ET Fed’s Barr speaks; 2:15ET Fed’s Barr speaks

TODAY’S HIGHLIGHTS and News:  

• US blocks AMD from selling advanced chips to China without a license
• Biden administration to limit credit card late fees in move against junk fees
  
• The Broncos face an $89mm hit in dead cap charges over the next two seasons after cutting quarterback Russell Wilson

Global shares eased from their recent highs as the commencement of China’s annual parliamentary session revealed no major stimulus initiatives. Sentiment also took
a hit after Bloomberg reported that the US Commerce Department will bar exports to China of AI processors made by Advanced Micro Devices. The Chinese government set an ambitious target for annual growth at 5%, 5.5% urban unemployment, 3% inflation rate and
will issue 1 trillion yuan ($139 billion) of ultra-long bonds, a rare move as provinces struggle with local debt. Ceasefire negotiations between Hamas and mediators in Cairo reached no resolution on Tuesday, with just days left to halt fighting in time for
the start of Ramadan.          

EQUITIES: 

US equity futures are lower as hawkish comments from a Federal Reserve policymaker reinforced the message that the US central bank is in no rush to cut interest rates. Attention turns
next to Fed Chair Jerome Powell and his semiannual testimony before Congress on Wednesday and Thursday. Powell is expected to reinforce the message that the Fed will be patient in cutting rates. Atlanta Fed President Raphael Bostic said Monday he expects the
first cut to be in the third quarter and followed by a pause. Bullish positioning in US tech stocks is at the highest in three years, raising the risk of a pullback, Citi warned.

Futures ahead of the bell: E-Mini S&P -0.3%, Nasdaq -0.6%, Russell 2000 -0.5%, DJI -0.3%  

In pre-market trading, chipmaker Advanced Micro Devices slipped more than 2%, having hit a US government roadblock in its plan to sell an artificial intelligence chip tailored for China.
Apple lost 2% after research showed a 24% slump in iPhone sales in China. Target jumped 8% after profit beat amid improvements in inventory. AeroVironment (AVAV) rose 19% after the defense contractor reported adjusted earnings per share that beat estimates.
Gitlab (GTLB) shares sink 24% after the application software company gave a weaker full-year forecast which overshadowed otherwise strong 4Q results. Paymentus (PAY) climbed 20% after the provider of cloud-based bill payment technology issued stronger-than-expected
forecasts. Stitch Fix (SFIX) fell 14% after the online personal styling service cut its full-year net revenue guidance. Tesla (TSLA) fell 2% , set to extend losses after dropping 7.2% on Monday following disappointing China vehicle shipment figures. Bark (BARK)
jumps 8% after Jefferies raised the pet-supplies retailer to buy.

GOOGL testing its 200dma

European gauges reversed early losses but remain in the red amid a lukewarm response to a slew of announcements from China. Europe’s Stoxx 600 index slipped with miners and automotive
shares the hardest hit as China’s latest market-support measures, announced today, failed to reassure investors. Among individual stocks, defense firm Thales SA jumped ~8% after forecast-beating results and Spirent Communications soared nearly 60% after Viavi
Solutions agreed to buy the electronic solutions provider. UK Retail Sales for February were weaker than expected due to the rainiest February on record. UK services PMI were revised down 0.5 points from the ‘flash’ estimate. Over in France, industrial production
dropped much further than expected at the start of the year, adding to signs that the euro area’s second largest economy is struggling to regain momentum. Stoxx 600 -0.2%, DAX -0.1%, CAC -0.1%, FTSE 100 -0.05%. Utilities +1.2%, Telecom and Healthcare +0.1%.
Basic Resources -1%, Autos -0.8%, Technology -0.5%.

Asian stocks were mostly lower as investors sold Hong Kong shares over disappointment with economic goals unveiled by Beijing at its annual policy meeting. Mainland Chinese stocks reversed
early losses with the blue-chip CSI 300 leading gains in the region amid signs of suspected state-backed buying of some exchange-traded funds. The MSCI Asia Pacific Index lost 0.4%, with Chinese tech giants Alibaba and Tencent among the biggest drags. Chinese
defense firms jumped after the NPC unveiled it aims to increase military spending by the most in five years. Apple’s iPhone sales in China declined by 24% over the first six weeks of this year, pushing it to fourth among smartphone vendors in the country.
Huawei saw unit sales rise by 64% in the period, according to research firm Counterpoint. The overall smartphone market in China shrank 7%. CSI 300 +0.7%, Vietnam +0.7%, Topix +0.5%, Taiwan +0.4%. Hang Seng Index -2.6%, Kospi -0.9%, Philippines -0.7%, Singapore
-0.5%, Sensex -0.3%, ASX 200 -0.15%.

FIXED INCOME: 
 

Treasury yields are lower across the curve, with futures near overnight highs, as the US session gets under way. Core European rates likewise better on the day after
French industrial production data were weaker than expected. IG credit issuance slate includes Israel multi-tranche $benchmark, continuing the YTD corporate borrowing binge. US Treasuries richer by 2bp-5bp across the curve with 10-year around 4.16%. 2/10 curve
flatter by 3bps.   

METALS: 
   

Gold futures are nearing record highs due to speculation about a potential shift in Federal Reserve policy and ongoing geopolitical tensions. Tensions in the Middle
East, economic uncertainties in China and the upcoming US presidential election are reinforcing gold’s status as a safe haven. Spot gold pushed to a new record high. Spot gold +0.7%, silver +0.7%. 

ENERGY:  

Crude oil slipped, as Chinese policymakers largely refrained from setting the kind of aggressive goals that could excite commodities investors hoping for ambitious
spending plans to lift demand. Iran is defying US sanctions with surging exports of liquefied petroleum gas, the latest sign that American pressure is failing to dent the Islamic Republic’s energy sales as its role in funding regional militias comes under
scrutiny.  WTI -1%, Brent -0.9%, US Nat Gas -0.9%, RBOB -1.5%.

CURRENCIES:   

In currency markets, the dollar headed for its first day of gains in three, while the yen modestly advanced following Tokyo inflation data. Tokyo price growth rose
above the Bank of Japan’s target in February and modestly supported the yen. Consumer prices excluding fresh food rose 2.5%, re-accelerating after cooling in January to a revised 1.8%. Sterling nudged down ahead of Wednesday’s UK budget. Focus is on US data
today including factory orders and durable goods, as well as primaries in more than a dozen states. The Aussie$ slipped amid investor wariness over the growth target of 5% set for this year by China, Australia’s largest trading partner. US$ Index +0.1%, GBPUSD
-0.1%, EURUSD -0.1%, USDJPY -0.1%, AUDUSD -0.3%, NZDUSD -0.3%.

Bitcoin -0.2%, Ethereum +5%. Bitcoin slipped after nearing all-time highs as the next halving approaches. The latest estimates suggest timing of event on approx.
April 19^th. Bitcoin’s in sight of an all-time high but in market value terms, it’s already touched a record. The token’s market capitalization reached $1.35 trillion, scaling its pandemic-era bull run peak of $1.28 trillion in November 2021, according
to CoinGecko. Ethereum outperforms today after it settled last week above a key technical level.

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
• ARS Pharmaceuticals Inc (SPRY) Raised to Outperform at Leerink; PT $18
• AT&T (T) Raised to Outperform at Wolfe; PT $21
• Bark (BARK) Raised to Buy at Jefferies; PT $1.90
• Cable One (CABO) Raised to Buy at MoffettNathanson LLC; PT $615
• Geodrill (GEO CN) Raised to Buy at Beacon Securities; PT C$2.25
• National Bank of Canada (NA CN) Raised to Outperform at KBW; PT C$116
• ONE Gas (OGS) Raised to Buy at Ladenburg Thalmann; PT $64.50
• Sea Ltd (SE) ADRs Raised to Overweight at JPMorgan; PT $70
• ADRs Raised to Add at CGS Int’l; PT $74
• Thinkific Labs (THNC CN) Raised to Buy at Canaccord; PT C$5
• Downgrades
• Genesco (GCO) Cut to Neutral at B Riley; PT $31
• Grifols (GRF SM) ADRs Cut to Neutral at Alantra Equities; PT $11.20
• RCM (RCM) Cut to Hold at Truist Secs; PT $16
• Sunnova Energy (NOVA) Cut to Equal-Weight at Morgan Stanley; PT $14
• Williams-Sonoma (WSM) Cut to Hold at Loop Capital; PT $220
• Initiations
• Adobe (ADBE) Rated New Buy at Sealand Securities; PT $645
• Amphastar (AMPH) Rated New Overweight at JPMorgan; PT $60
• Array (ARRY) Rated New Sector Weight at KeyBanc
• BBB Foods (TBBB) Rated New Equal-Weight at Morgan Stanley; PT $22
• Celsius Holdings (CELH) Rated New Buy at Sealand Securities
• Heartland BancCorp (HLAN) Reinstated Overweight at Piper Sandler
• Installed Building (IBP) Rated New Buy at DA Davidson; PT $275
• Lumine Group (LMN CN) Rated New Buy at Veritas Investment Research Co
• Metagenomi (MGX) Rated New Buy at Chardan Capital Markets; PT $21
• Rated New Outperform at Cowen
• Rated New Overweight at Wells Fargo; PT $25
• Rated New Overweight at JPMorgan; PT $16
• Rated New Buy at Jefferies; PT $23
• Rated New Outperform at BMO; PT $22
• Nike (NKE) Reinstated Buy at CTBC Securities; PT $124
• TopBuild (BLD) Rated New Buy at DA Davidson; PT $470

Data sources: Bloomberg, Reuters, CQG