Daily Game Plan

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

TODAY’S ECONOMIC DATA:  8:30ET Initial Jobless Claims; 10:00ET Wholesale Trade; 1:00ET 30 Year Bond Auction; 3:00ET
Fed’s Thomas Barkin speaks

HIGHLIGHTS and News:  

• 1% of credit card balances in the US are now 90+ days delinquent, the highest since 2012
• A total of 27 gold medals are in play today
• Taylor Swift’s shows in Vienna this week were canceled after authorities uncovered plans for a terrorist attack
• Steve Martin won’t be playing Tim Walz, turning down a request from SNL

Global shares fell following turbulent sessions on Wall Street and Asia as traders waited for US weekly jobless claims data, which has taken on extra significance
after weak employment numbers helped spark Monday’s market rout. Volatility has gripped global markets for days as the debate around central bank policy decisions continues to fuel investor anxiety.  The PBOC may have more room for rate cuts if the Fed eases
aggressively. Some economists say China’s surprise cut last month could now be followed by another two such moves in 2024 — easing on a scale unseen in years.

EQUITIES:  

US equity futures fluctuated overnight after turning yesterday’s early gains into losses. Today’s US jobless claims figures are in sharper focus than ever after last week’s flimsy payrolls
numbers. JPMorgan said it now sees a 35% chance that the US economy tips into a recession by the end of this year, up from 25% as of the start of last month. JPM also said 75% of the global carry trade has now been removed, with the recent selloff wiping out
year-to-date returns. The bank’s new calculation for recession risks follows a similar step by Goldman Sachs Group, which now sees a 25% probability of a recession in the next year.

Futures ahead of the bell: E-Mini S&P +0.1%, Nasdaq +0.2%, Russell 2000 -0.2%, DJI -0.1%

In pre-market trading, Warner Bros. Discovery (WBD) slides 10% after taking a $9.1 billion write-down on the value of its traditional TV networks. Monster Beverage (MNST) falls 8% after
growth in the energy-drink maker’s revenue and drink volumes slowed to its worst rate since the start of the Covid-19 pandemic. SolarEdge (SEDG) tumbles 15% after the renewable energy firm’s revenue forecast for the 3Q came in well below the average analyst
estimate. Under Armour (UAA) rises 7% as management raised its guidance as the sports gear brand restructures under returning founder Kevin Plank. Dutch Bros (BROS) slumps 22% after the drive-through coffee chain tempered its store growth outlook. Lilly (LLY)
rises 10% after lifting its 2024 sales outlook for the second time this year as its blockbuster weight-loss drug Zepbound outsold expectations. Klaviyo (KVYO) jumps 18% after the company boosted its revenue guidance for the year. Amneal (AMRX) rises 6% after
the drug maker received US FDA approval for its extended-release capsules for the treatment of Parkinson’s Disease. Bumble (BMBL) plunges 41% after the dating company slashed its annual revenue outlook.

European gauges resumed their decline, ending a two-day rebound, as mixed earnings and an uncertain US economic outlook pressured sentiment.  The Euro Stoxx 600 is reversing much of Wednesday’s
advance, dragged lower by technology and real estate sectors. Siemens AG shares dropped after the manufacturer said it sees group revenue growth and returns in its key industrial unit at the lower end of forecasts. Zurich Insurance Group AG shares fell after
the company reported a rise in losses at its property and casualty arm, driven in part by “higher catastrophe losses and weather events.” Allianz SE climbed after second-quarter profit rose on stronger earnings from its life-health insurance and asset management
businesses. Deliveroo Plc rallied after reporting stronger customer orders and saying earnings for the year will be on the higher end of its forecast. Despite some high-profile earnings misses, the overall earnings season has been relatively positive, with
MSCI Europe index earnings-per-share growth at 2.4%, surpassing expectations.  Stoxx 600 -0.9%, DAX -0.6%, CAC -1.1%, FTSE 100 -1.2%. Technology -1.9%, Media -1.8%, Real Estate -1.7%. Telecomm +0.03%. 

Shares in Asia were mostly lower, as Japanese shares closed lower after a volatile trading session. The Nikkei 225 swung from early losses of more than 2% and gains of nearly 1% before
finishing 0.7% lower on the day. The MSCI Asia Pacific Index fell 0.4%, weighed by tech shares including TSMC, Samsung and Keyence.  Exporters also took a hit after the yen strengthened against the dollar. The gauge is headed for its fourth successive week
of losses as investors reassess the outlook for the US economy and the nation’s interest rate trajectory. Chinese stocks in Hong Kong and the mainland were broadly steady. In India, shares fell as the Reserve Bank of India kept the key policy rate unchanged
and stressed the need to be vigilant about inflation. Taiwan -2%, Topix -1.1%, Sensex -0.7%, Vietnam -0.6%, Kospi -0.4%, ASX 200 -0.2%. CSI 300 +0.05%, Hang Seng Index +0.1%, Singapore +0.4%.

FIXED INCOME: 
 

Treasuries hold small gains in early US trading with European stocks and US stock index futures under pressure ahead of jobless claims data that helped ignite a rally
last week. Supply remains in focus as auction cycle concludes with $25b 30-year bond sale and at least a couple of corporate offerings are expected to follow Wednesday’s deluge of almost $32 billion. 10-year yield is down ~2bps after rising on Wednesday following
a weak debt auction. Yields are mixed across the curve with inverted 2s10s around -3bp after closing at YTD high -2.1bp Wednesday.

METALS: 

Gold prices rose, following a five-day drop — the longest run of declines in almost six months. Gold and silver firmed as the dollar and Treasury yields retreated
on rising bets that US interest rate cut cycle may start in September, while investors awaited the weekly jobless claims data. Spot gold +1.1%, silver +1.4%.

ENERGY:   

Oil steadied after its biggest advance in a week, with traders still glued to fluctuations in wider markets and tensions in the Middle East. Oil prices rose yesterday
when data showed a bigger-than-expected drawdown in US crude stockpiles. US crude inventories fell for the sixth consecutive week, reaching the lowest levels since February. The streak is the longest since January 2022. Growing supply risks in the Middle East
are offsetting demand concerns that had pushed prices to their lowest since early 2024 at the start of the week. . Israel braces for potential Iranian attacks, though diplomatic signals from Iran suggest possible de-escalation.  While no supply has been impacted
so far, attacks on ships in the Red Sea have forced tankers to take longer routes. WTI -0.01%, Brent -0.15%, US Nat Gas -1.75%, RBOB +0.2%.

CURRENCIES:   

In currency markets, risk-off sentiment boosted the franc and yen, pressuring Norway’s krone, while the Aussie dollar climbed after RBA Governor Michele Bullock indicated
potential rate hikes. The RBI kept its key rate unchanged as expected. USDJPY fell 0.9% before stabilizing, as BOJ minutes suggested continued accommodative policy despite a recent hike. Today’s summary of opinions from last week’s Bank of Japan meeting showed
that authorities didn’t see last month’s surprise rate hike as policy tightening.  New Zealand’s inflation expectations fell for the current quarter. US$ Index -0.1%, GBPUSD +0.02%, EURUSD +0.05%, USDJPY +0.45%, AUDUSD +0.5%, USDNOK +0.5%, USDCHF -0.6%.

Spot Bitcoin +4.3%, Spot Ethereum +4.2%. Major cryptocurrencies rose after Ripple was ordered by a US court to pay a $125 million penalty, just a fraction of what
the SEC had sought.

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
• ARM Holdings (ARM) ADRs Raised to Outperform at Daiwa; PT $130
• Ashland Inc (ASH) Raised to Neutral at JPMorgan; PT $89
• Ceva (CEVA) Raised to Buy at Roth MKM; PT $25
• Fortinet (FTNT) Raised to Hold at DZ Bank; PT $65
• HubSpot (HUBS) Raised to Sector Weight at KeyBanc
• Klaviyo (KVYO) Raised to Overweight at KeyBanc; PT $33
• Lattice Semi (LSCC) Raised to Outperform at Raymond James; PT $50
• Nevro (NVRO) Raised to Peerperform at Wolfe
• Vornado Realty (VNO) Raised to Neutral at Piper Sandler; PT $30
• Raised to Outperform at BMO; PT $40
• Wolverine World Wide (WWW) Raised to Overweight at KeyBanc; PT $20
• Downgrades
• AZEK (AZEK) Cut to Neutral at DA Davidson; PT $44
• Bumble (BMBL) Cut to Neutral at BTIG
• Cut to Inline at Evercore ISI; PT $8
• Cut to Hold at Stifel; PT $6.50
• Cut to Neutral at JPMorgan; PT $7
• CCU (CCU CI) ADRs Cut to Underweight at JPMorgan; PT $10
• Celsius Holdings (CELH) Cut to Underperform at BofA; PT $32
• Charles River (CRL) Cut to Neutral at JPMorgan; PT $205
• Cut to Neutral at Baird; PT $191
• Dine Brands (DIN) Cut to Hold at Benchmark
• Disney (DIS) Cut to Neutral at Seaport Global Securities
• Envista Holdings (NVST) Cut to Neutral at JPMorgan; PT $16
• Fastly (FSLY) Cut to Neutral at Piper Sandler; PT $6
• Fortrea (FTRE) Cut to Inline at Evercore ISI; PT $27
• G1 Therapeutics (GTHX) Cut to Neutral at HC Wainwright
• Greenlane Renewables (GRN CN) Cut to Sell at TD Cowen
• Hudson Pacific (HPP) Cut to Neutral at Piper Sandler; PT $6
• Cut to Market Perform at BMO; PT $6
• Intel (INTC) Cut to Neutral at Mizuho Securities; PT $22
• International Money (IMXI) Cut to Neutral at BTIG
• JFrog (FROG) Cut to Market Perform at Oppenheimer
• Louisiana-Pacific (LPX) Cut to Market Perform at BMO; PT $99
• Outset Medical (OM) Cut to Sector Perform at RBC; PT $3
• PetIQ (PETQ) Cut to Hold at Truist Secs; PT $31
• RCM (RCM) Cut to Equal-Weight at Morgan Stanley; PT $14.30
• Schneider National (SNDR) Cut to Hold at Stifel
• SmartRent (SMRT) Cut to Neutral at Cantor; PT $2
• Textron (TXT) Cut to Equal-Weight at Morgan Stanley; PT $95
• Topgolf Callaway Brands (MODG) Cut to Neutral at BofA; PT $13
• Cut to Sector Weight at KeyBanc
• United Parks & Resorts (PRKS) Cut to Neutral at Goldman; PT $53
• Vestis (VSTS) Cut to Neutral at Baird; PT $13
• Initiations
• Apple (AAPL) Rated New Outperform at CICC; PT $250.20
• Axon (AXON) Reinstated Buy at William O’Neil
• Geely Auto (175 HK) ZK US Rated New Outperform at CCB Intl; PT $35.90
• Olin (OLN) Rated New Neutral at Mizuho Securities; PT $45
• ON Semi (ON) Rated New Add at Great Wall Securities
• Pyxis Oncology (PYXS) Rated New Buy at Stifel; PT $10
• Stride (LRN) Rated New Buy at Canaccord; PT $94
• Tandem Diabetes (TNDM) Rated New Buy at Canaccord; PT $57
• Udemy (UDMY) Rated New Buy at Canaccord; PT $12
• Westlake Corp (WLK) Rated New Outperform at Mizuho Securities; PT $170

Data sources: Bloomberg, Reuters, CQG