Daily Game Plan

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

TODAY’S ECONOMIC DATA:  8:30ET Initial Jobless Claims, Housing Starts, Building Permits,
Philadelphia Fed Business Outlook; 8:45ET Fed’s Kashkari speaks; 1:00ET 5-Year TIPS auction; 4:00ET Fed’s Barkin speaks

HIGHLIGHTS and News:  

• Tropical Storm Alberto is strengthening near the Gulf coast of Mexico
• A record of almost 71 million Americans are expected to travel over the Fourth of July holiday period
• US Housing Starts & Building Permits Plunge To COVID Lockdown Lows

Global shares held around record highs, supported by investor confidence that more central banks will cut interest rates in the coming months. The Bank of England
held its key Bank Rate unchanged at 5.25% today, choosing to wait for next month’s Parliamentary elections before reducing a rate that has remained at the highest levels in sixteen years. Data on Wednesday showed British inflation returned to the central bank’s
2% target for the first time in nearly three years in May. The Swiss National Bank cut interest rates for a second time this year, while Norway’s Norges Bank left rates unchanged, as expected. Brazil’s central bank held its benchmark Selic rate steady at 10.5%.
Putin arrived in Vietnam from North Korea, where he and Kim Jong Un revived a Cold-War era agreement to provide immediate military assistance if one of them is attacked.   

EQUITIES:
6th straight record for the Nasdaq

US equity futures moved higher, led by tech heavy Nasdaq, as investors looked to extend the market’s recent record highs heading into the final stretch of an impressive second quarter. 
Stocks ended the pre-holiday break with another set of fresh record highs on Tuesday, with Nvidia eclipsing Microsoft as the world’s most-valuable company and helping power the Nasdaq to an all-time high. Market activity may be quieter than usual today as
traders ready for a quarterly event on Friday where index futures, equity index options and stocks options all expire in a process known as triple witching.

Futures ahead of the bell: E-Mini S&P +0.3%, Nasdaq +0.4%, Russell 2000 +0.1%, DJI +0.02%.

In pre-market trading, Dell (DELL) gains 3% and Super Micro Computer (SMCI) climbs 4% after Elon Musk said in post on X that the companies will provide server racks for the supercomputer
that the billionaire’s artificial intelligence startup xAI is building. Accenture (ACN) rises 6% after posting 3Q results and providing forecasts. Harrow (HROW) rises 13% after providing a relaunch update for corticosteroid Triesence. Nvidia (NVDA) climbs
3% as the world’s most-valuable company extends its lead over fellow mega-cap tech firms. Ocular Therapeutix (OCUL) gains 7% after TD Cowen upgraded the stock to buy. Trump Media & Technology Group (DJT) declines 11% after the SEC declared effective a regulatory
filing that could dilute shareholders on Tuesday. Winnebago Industries (WGO) slips 4.8% after posting quarterly profit that missed.

European gauges rose after the Swiss National Bank trimmed interest rates for the second time this year, encouraging hopes for policy easing across the developed world. The Bank of England
held interest rates steady as expected but hinted that more of its policymakers are close to backing cuts. BoE Governor Andrew Bailey said that it was “good news” that the latest data had shown inflation was back at its 2% target, but that it was too soon
to cut rates. The BoE expects inflation to rise above target as the effect of past energy price falls drops out of annual inflation data, and repeated its May forecast for inflation to be around 2.5% in the second half of 2024. Among individual movers, Evotec
SE rallied 14% following a report that the German drug developer is speaking to defense advisers after a decline in its share price prompted fears about the company’s vulnerability to a takeover. Societe BIC SA slumped as much as 19% after the French maker
of pens and lighters downgraded its sales guidance. Stoxx 600 +0.5%, DAX +0.5%, CAC +0.8%, FTSE 100 +0.3%. Technology +1.6%, Construction +1%, REITs +1%. Food & Bev -0.4%.

Asian stocks traded mixed to lower in lackluster trading, dragged by Chinese shares, which fell for a second straight day. The MSCI Asia Pacific Index dropped 0.2%, after gaining 1.7%
over the previous two sessions. The biggest drags on the gauge included Tencent, Toyota and Alibaba. Hong Kong benchmarks pared Wednesday’s sharp gains as traders eye more capital market reform policies. Stocks paying high dividends rose in Hong Kong amid
expectations that authorities will waive the 20% tax on payouts for shares bought via trading links. Chinese technology shares got a boost from a slew of new measures announced Wednesday to shore up the STAR market. Indonesia +1.4%, Taiwan +0.8%, Kospi +0.4%,
Vietnam +0.2%, Sensex +0.2%, Nikkei 225 +0.15%. Topix -0.1%, Thailand -0.4%, Hang Seng Index -0.5%, CSI 300 -0.7%.

FIXED INCOME: 
 

Treasuries reopen after Wednesday’s Juneteenth holiday with yields cheaper by around 2bp across the curve. Early weakness was pared slightly as gilts advanced after
Bank of England kept rates on hold but hinted it may soon back cuts. European bonds were pressured lower from the London open, weighing on Treasuries despite healthy demand for a French bond sale. US 10-year yield trades around 4.24%, cheaper by ~2bp vs Tuesday’s
close. Today’s US session includes a $21b 5-year TIPS reopening auction.  

METALS: 

Gold edged higher after closing the previous session little changed, as the precious metal is likely to remain range-bound until the Federal Reserve’s monetary policy
outlook becomes clearer. Spot gold +0.35%, silver +1.5%.

ENERGY:   

Oil prices edged up in early trade as Israeli tanks advanced into Gaza. WTI crude, meanwhile, fluctuated ahead of the US government’s oil inventories report, which
was delayed by a day due to the national holiday. Prices have surged in the last two weeks, following one of the most-aggressive periods of short-selling on record pushed futures to their lowest levels in months. Since early June, both Brent crude and West
Texas Intermediate are up by almost 10%. Bad weather in the Gulf of Mexico is also playing a part, particularly for American grades. The summer rally is critical for OPEC+ if it is to go ahead with a potential plan for some members to add barrels back to the
global market. WTI +0.1%, Brent +0.3%, US Nat Gas -2.3%, RBOB +0.4%

CURRENCIES:   

In currency markets, the Swiss franc tumbled after officials said they’re prepared to intervene if needed. The SNB shocked again, cutting its benchmark rate by 25
bps to 1.25%, lowering its inflation forecast to be within a 0-2% target range through 2026. The BOE kept rates on hold as expected ahead of the UK election but its minutes hinted that more policymakers may be close to backing cuts, sending the pound lower.
The Indian rupee declined to an all-time low as broad dollar strength weighed on most emerging Asian currencies. The Norwegian Krone rose after Norway’s central bank signaled it will likely keep borrowing costs at the highest level since 2008 for the rest
of the year. US$ Index +0.2%, GBPUSD -0.3%, USDJPY +0.2% EURUSD -0.2%, AUDUSD -0.1%, USDNOK -0.5%, USDCHG +0.7%.

Spot Bitcoin +1.8%, Ethereum +1%.

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
• Bilibili (BILI) ADRs Raised to Overweight at JPMorgan; PT $21
• Bread Financial Holdings (BFH) Raised to Inline at Evercore ISI
• ERO Copper (ERO CN) Raised to Outperform at CIBC; PT C$36
• First Quantum Minerals (FM CN) Raised to Buy at Citi; PT C$26
• iRhythm (IRTC) Raised to Outperform at Wolfe; PT $115
• Neo Performance (NEO CN) Raised to Buy at Stifel Canada; PT C$13
• Ocular Therapeutix (OCUL) Raised to Buy at TD Cowen; PT $11
• Downgrades
• Prelude Therapeutics (PRLD) Cut to Underweight at Barclays; PT $3
• Spirit Aero (SPR) Cut to Hold at Benchmark
• Zentalis (ZNTL) Cut to Hold at Jefferies; PT $6
• Initiations
• Capstone Copper (CS CN) Rated New Outperform at Macquarie; PT C$12
• Collective Mining (CNL CN) Rated New Outperform at BMO; PT C$8.25
• Elf Beauty (ELF) Reinstated Buy at William O’Neil
• Esab (ESAB) Rated New Outperform at Oppenheimer; PT $115
• F3 Uranium Corp (FUU CN) Rated New Buy at Eight Capital
• Life360 (360 AU) Rated New Market Outperform at JMP; PT $38
• NGEx Minerals (NGEX CN) Rated New Speculative Buy at Canaccord; PT C$12.25
• Robinhood (HOOD) Rated New Buy at Sealand Securities
• Vericel (VCEL) Rated New Buy at TD Cowen; PT $55

Data sources: Bloomberg, Reuters, CQG