Daily Game Plan

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

TODAY’S ECONOMIC DATA:  8:15ET ADP Employment Change; 8:30ET GDP, Personal Consumption, Core PCE Price Index, US
Treasury Quarterly Refunding Announcement; 10:00ET Pending Home Sales

ADP US OCT. PRIVATE EMPLOYMENT RISES 233,000; EST. +111K. U.S CORE PCE PRICES (Q3) ACTUAL:  2.20% VS 2.80% PREVIOUS; EST 2.10%.

HIGHLIGHTS and News:  

• Kamala Harris said she will work with Congress to pass immigration reform that includes earned path to citizenship for hardworking immigrants
• Russian Hackers Are Targeting US Officials, Microsoft Says
• The EU imposed tariffs on EVs from China ranging up to 45%

World stocks slipped as investors sifted through corporate earnings. The euro area’s economy expanded more strongly than expected in the third quarter, with Germany
unexpectedly avoiding a recession. Growth quickened to 0.4% as momentum in France accelerated and stayed strong in Spain. Germany’s surprise 0.2% increase in gross domestic product caught analysts off guard, though the reading for the previous three months
was revised down sharply. The weak point was Italy, where output was unexpectedly flat. Israel is weighing a deal to end the conflict in Lebanon that would see Hezbollah fighters move away from the Israeli border.

EQUITIES:  

US equity futures fluctuated as investors await Microsoft and Meta results along with key US data. Nasdaq is outperforming after Alphabet reported quarterly revenue that beat estimates.
AMD met expectations on earnings but analysts weren’t too keen on the company’s Q4 revenue outlook. The chipmaker’s stock tumbled over 8% overnight amid fears of slowing artificial intelligence growth. Hiring at US companies accelerated by the most in over
a year, pointing to surprisingly solid demand for workers. Private payrolls increased by 233,000 in October, according to the ADP Research Institute, exceeding all estimates.

Futures ahead of the bell: E-Mini S&P +0.01%, Nasdaq +0.1%, Russell 2000 -0.25%, DJI -0.2%.

In pre-market trading, Alphabet (GOOGL) gains 6%, showing an expensive foray into artificial intelligence is starting to pay off, delivering better-than-expected sales
for its cloud-computing business. Eli Lilly (LLY) shares tumbled 9% after sales of its blockbuster weight-loss drug fell short and the company lowered guidance. Chipotle (CMG) drops 5% after reporting third-quarter sales that fell just short. First Solar (FSLR)
falls 7% on a lowered full-year guidance partly due to India market headwinds. NerdWallet (NRDS) surges 27% after the consumer finance firm’s third-quarter revenue beat estimates. Reddit (RDDT) rises 20% after the company’s sales and forecast beat analyst
expectations. Visa (V) gains 2% after the payments company’s fiscal fourth-quarter earnings surpassed expectations. Qorvo Inc. (QRVO) , whose biggest customer is Apple, tumbled 20% after forecasting revenue and profit far short of estimates.

The US ADP employment change report is on the radar for investors after data this week showed job openings fell in September to the lowest since early 2021 and layoffs
picked up. The downside surprise in September job openings contrasts with the strong jobs report. The October jobs report (due Nov. 1) may show declining demand for workers. 

European gauges declined ahead of the UK budget and data on the US economy. French stocks underperform despite figures showing the country’s economy performed stronger
in the third quarter than expected. The Stoxx 600 index fell more than 1% amid a deluge of earnings. Drugmaker Novo Nordisk A/S slid after US peer Eli Lilly cut its guidance. Among companies reporting results, UBS Group AG shares fell as the bank warned of
lingering risks. Moncler SpA dropped after a third-quarter revenue miss from the Italian maker of high-end puffer jackets. Davide Campari-Milano NV plunged as much as 17% after the Aperol maker gave a weak sales forecast. GSK Plc fell after reporting lower-than-expected
sales for two of its blockbuster vaccines. Nexans SA plunged 10% after missing revenue estimates, while Amundi SA dropped more than 5% after net inflows fell short of estimates.  Standard Chartered rose after boosting returns to shareholders. Stoxx 600 -1.3%,
DAX -1.2%, CAC -1.6%, FTSE 100 -0.6%. Tech -1.9%, Basic Resources -1.9%, Food & Bev -1.7%.

Shares in Asia were mostly lower, dragged lower by losses of more than 1% in mainland China and Hong Kong stocks. The MSCI Asia Pacific Index slipped 0.1%. Japanese
benchmarks led gains as tech shares tracked advances in their US peers. An improved outlook for nuclear power supported utility shares. Hong Kong and mainland China dropped on continued volatility as traders await more decisive moves from Beijing to support
the ailing economy. Chinese property developers’ shares rose after a media report said the government is considering 4t yuan in special bonds to support the property sector. Nikkei 225 +~1%, Philippines +0.6%. Vietnam -0.25%, Taiwan -0.5%, Indonesia -0.5%,
Sensex -0.5%, ASX 200 -0.8%, Singapore -0.9%, CSI 300 -0.9%, Kospi -0.9%, Hang Seng Index -1.5%.

FIXED INCOME: 
 

Treasuries gained and gilts jumped before a hotly anticipated UK budget. US 10-year Treasury yield slips two basis points to 4.23%. Long-end leads gains on the day,
flattening 2s10s and 5s30s close to Tuesday’s lows. German short-dated maturities lag after regional inflation and GDP data saw ECB rate-cut pricing fade. US session includes October ADP employment change and first estimate of 3Q GDP.

METALS: 

Gold hit a fresh record high as traders weighed potential market disruption ahead of the election. Global gold demand swelled about 5% in the third quarter, setting
a record for the period and lifting consumption above $100 billion for the first time, according to the World Gold Council. Spot gold +0.1%, Silver -1.2%, Copper -0.7%

ENERGY:   

Oil rose after a two-day decline on the prospect for a further easing of hostilities in the Middle East. Diminishing geopolitical worries have put the focus back
on concern over the demand outlook, particularly for China. The oil market has “relaxed too quickly” over Middle East risks, Standard Chartered said. The scope for further action in the region “is likely to widen significantly” as soon as voting has concluded
in the US election. Israel’s security cabinet is discussing the terms of a truce with Hezbollah in south Lebanon, where Israeli troops are conducting
a ground offensive, Energy Minister Eli Cohen said.  Investors will be watching official data on US crude inventories after industry figures showed an unexpected decline. WTI +1.1%, Brent +1.1%, US Nat Gas ~flat, RBOB +0.8%.

CURRENCIES:   

In currency markets, the dollar weakened versus most Group-of-10 peers amid month-end and profit-taking flows before key US data releases due today. The euro heads
for a third daily advance. Data showed that growth quickened in France and held steady in Spain, exceeding expectations; Germany’s surprise 0.2% GDP increase caught analysts off guard, though the reading for the previous three months was revised down sharply.
Sterling is lower as traders wait for the Labour government’s first budget in almost 15 years. The budget is expected to include £35 billion in tax and welfare savings, alongside a fiscal-rules revamp that will enable an extra £70 billion of government borrowing
for investment. The yen firms ahead of the Bank of Japan policy announcement. The BOJ is widely expected to stand pat Thursday in the face of elevated uncertainty, as financial markets brace for the US presidential election. US$ Index -0.05%, GBPUSD -0.35%,
EURUSD +0.05%, USDJPY -0.2%, AUDUSD +0.25%, NZDUSD +0.2%.

Spot Bitcoin -0.5%, Spot Ethereum +1.5%.

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
• Boot Barn (BOOT) Raised to Outperform at Baird; PT $167
• Camping World (CWH) Raised to Outperform at Raymond James; PT $27
• Civista Bancshares (CIVB) Raised to Outperform at Hovde Group; PT $22
• CTO Realty (CTO) Raised to Strong Buy at Raymond James
• Edenor (EDN AR) ADRs Raised to Overweight at Morgan Stanley; PT $35
• German American (GABC) Raised to Outperform at Hovde Group; PT $48
• Leggett & Platt (LEG) Raised to Neutral at Piper Sandler; PT $13
• Selective Insurance (SIGI) Raised to Outperform at BMO; PT $105
• Downgrades
• Agilon Health (AGL) Cut to Sell at Citi; PT $2.50
• AMD (AMD) Cut to Hold at Punto Casa de Bolsa; PT $170.22
• BioMarin (BMRN) Cut to Market Perform at William Blair
• Boeing (BA) Cut to Market Perform at Bernstein; PT $169
• Check Point Software (CHKP) Cut to Neutral at BofA; PT $195
• Crocs (CROX) Cut to Market Perform at Raymond James
• DT Midstream (DTM) Cut to Hold at Stifel; PT $89
• Edwards Life (EW) Cut to Neutral at Daiwa; PT $72
• Graphic Packaging (GPK) Cut to Hold at Truist Secs; PT $30
• Hudson Technologies (HDSN) Cut to Neutral at B Riley; PT $8.50
• Kratos (KTOS) Cut to Neutral at B Riley; PT $26
• Lear (LEA) Cut to Equal-Weight at Barclays; PT $120
• Lyell Immunopharma (LYEL) Cut to Underperform at BofA; PT $1
• Masco (MAS) Cut to Sector Perform at RBC; PT $80
• Nvidia (NVDA) Cut to Sell at Punto Casa de Bolsa; PT $126.70
• Qorvo (QRVO) Cut to Neutral at BNPP Exane; PT $80
• Cut to Market Perform at Raymond James
• Retail Opportunity (ROIC) Cut to Market Perform at Raymond James
• Wallbox (WBX) Cut to Hold at Stifel; PT $1.50
• Williams-Sonoma (WSM) Cut to Neutral at Wedbush; PT $135
• Initiations
• Amaroq Minerals (AMRQ CN) Rated New Speculative Buy at Canaccord
• Empire Co (EMP/A CN) Reinstated Sector Perform at Scotiabank; PT C$44
• George Weston (WN CN) Reinstated Sector Perform at Scotiabank; PT C$222
• Loblaw (L CN) Reinstated Sector Outperform at Scotiabank; PT C$200
• Metro Inc (MRU CN) Reinstated Sector Outperform at Scotiabank; PT C$95
• Nano Nuclear Energy (NNE) Rated New Buy at HC Wainwright; PT $50
• TransAlta (TA CN) Reinstated Buy at Desjardins; PT C$15.50

Data sources: Bloomberg, Reuters, CQG

David Wienke