Daily Game Plan

by Contributor
on November 8, 2024

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

TODAY’S ECONOMIC DATA:  10:00ET U. of Mich. Sentiment; 11:00ET Fed’s Bowman speaks

Highlights and News:  

  • Trump picks Susie Wiles as his White House chief of staff, the first woman to hold the position
  • Trump won Nevada, NBC and CNN reported
  • A brush fire in the Los Angeles area is burning out of control and triggering evacuations
  • Nvidia and Sherwin-Williams join the Dow Jones Industrial Average today

 

World stocks are weaker after China unveiled a 10 trillion yuan ($1.4 trillion) program to help resolve its local government debt crisis that disappointed markets
due to a lack of fresh public spending to promote growth. The disappointment reverberated across markets as European stocks swung from gains to losses, led by declines in China-sensitive sectors such as mining, luxury and autos. Still, MSCI’s world stock index
is set for its best week since August. After an initial stampede into “Trump Trades,” investors in some asset classes are tapering their enthusiasm as they question whether he will push through his ambitious tariff proposals as US president.    

 

EQUITIES:  

US equity futures edge lower but the S&P 500 is still on track for its best week in a year on the prospect of potential tax cuts and deregulation under a Trump presidency. With a Republican
sweep now looking likely, economists see fewer Fed cuts than they did before the election.  The Biden administration is racing to complete Chips Act subsidy deals with Intel, Samsung and others before Trump takes office. Activewear maker Vuori is said to allow
some early investors and employees to sell shares in a tender offer that values the company at about $5.5B. Dow futures slightly outperform as Nvidia and Sherwin-Williams join the Dow Jones Industrial Average today.  

Futures ahead of the bell: E-Mini S&P -0.03%, Nasdaq -0.2%, Russell 2000 -0.2%, DJI +0.05%. 

In pre-market trading, DraftKings shares fall 7% after the sports-betting company cut its full-year revenue forecast and reported a wider-than-expected loss per share. Pinterest (PINS)
sank 13% after a weak holiday outlook. Airbnb (ABNB) shares drop 6% after the home-rental company reported third-quarter results. While analysts viewed the results as solid, they flagged the impact of investments on margins.  Agilon Health (AGL) tumbles 31%
after forecasting an adjusted Ebitda loss for the year that was wider than estimates. Airbnb (ABNB) falls 6% after the home-rental company posted quarterly results. Arista Networks (ANET) slips 5% after the computer networking company projected fiscal 2025
revenue growth of 15% to 17%, compared with 18% estimates. Cloudflare (NET) falls 7% after the infrastructure software company’s forecast for fourth quarter revenue fell short of consensus. Doximity (DOCS) soars 39% after the healthcare-software company raised
its year forecast. Evolent Health (EVH) tumbles 35% after the software provider’s earnings missed expectations. Five9 (FIVN) rallies 22% as the call-center software provider raised its full-year guidance. Fortinet (FTNT) slips 3% after the network security
software provider narrowed its billings forecast for the full year. Icahn Enterprises LP (IEP) slips 5% as the investment fund cut its dividend payout by half. Maravai LifeSciences (MRVI) sinks 32% after the life sciences firm cut its total revenue guidance
for the full year.

European gauges are lower, but well off the day’s lows, and set for a third straight week of declines on disappointing economic-support measures from China and glum
corporate earnings. Miners lagged the most as copper and other commodities declined following an underwhelming debt swap plan from China. Real Estate and Travel shares outperform. Cartier owner Richemont SA dropped after its first-half profit slumped. The
results sparked declines other luxury-goods makers including LVMH and Hermes International SCA. A victory for Donald Trump in the US presidential election has sparked worries about potential tariffs on European stocks, while third-quarter corporate earnings
have largely underwhelmed so far. Stoxx 600 -0.5%, DAX -0.6%, CAC -0.7%, FTSE 100 -0.5%. Basic Resources -3.3%, Personal Goods -2%, Autos -1.7%. Real Estate +1.3%, Travel & Leisure +0.5%.

Shares in Asia were mixed with the MSCI Asia Pacific Index rising as much as 0.8% before paring gains to end +0.1%. Key gauges in New Zealand, Singapore, and Australia
were among the biggest gainers, tracking a rally in US stocks after the Fed lowered its key interest rate by a quarter point. Shares fell in Hong Kong and mainland China after gains Thursday amid hopes for more stimulus. After the market close, authorities
announced a $1.4 trillion program to refinance local government debt, which disappointed investors who were expecting stronger fiscal spending. Japanese indexes pared early gains after data showed Japan’s household spending fell 1.1% in September, less than
the 2.1% decline expected, backing the case for the BOJ to take a cautious approach to rate hikes.  South Korea’s Kospi inched lower but the small-cap Kosdaq gained 1.3%. Singapore +1.4%, ASX 200 +0.8%, Taiwan +0.6%, Indonesia +0.6%, Nikkei 225 +0.3%, Topix
-0.03%, Sensex -0.05%, Kospi -0.15%, Philippines -0.5%, Vietnam -0.6%, CSI 300 -1%, Hang Seng Index -1.1%.

FIXED INCOME: 
 

US Treasuries advanced, recouping much of their post-election losses. US yields are 1-3bp lower across maturities with curve spreads slightly flatter. Bunds outperform,
supporting Treasuries, as euro-area stocks fall on global-growth concerns after China’s debt swap plan fell short of expectations. US data and Fed speaker calendars are light for today, and expectations for a heavy corporate issuance slate next week may drive
hedging flows. 10-year yield is around 4.30%; 2-year at 4.2%.

 

 

METALS: 

Gold fell at the end of a volatile week’s trading, as traders assessed the impact of Donald Trump’s presidency and its implications for the US interest rate outlook.
Global physically-backed gold exchange-traded funds saw inflows for the sixth straight month in October, the World Gold Council said. Gold is on track for its biggest weekly decline since May.  Copper declined with other commodities, after China’s debt swap
plan disappointed investors.  Spot gold -0.6%, Silver -1.8%, Copper -2.5%. 

 

 

 

ENERGY:   

 

Oil prices fell as the risk that a hurricane in the Gulf of Mexico will affect US oil and gas output declined while the market continues to weigh how President-elect
Trump’s policies might affect supplies. Standard Chartered said US producers won’t necessarily heed Trump’s call for more drilling. Iran’s oil exports are at risk if Trump beefs up sanctions when he comes into office next year, RBC said. Downward pressure
also came from data showing crude imports in China fell 9% in October, the sixth consecutive month showing a year-on-year decline.  WTI -1.3%, Brent -1%, US Nat Gas +0.7%, RBOB -1%.

 

 

CURRENCIES:   

In currency markets, the dollar strengthened further against the yuan, following a Chinese stimulus package which disappointed markets.  As officials outlined the
shape of the debt swap plan, the offshore yuan extended its losses, pulling its Asian peers such as the Australian and New Zealand dollars lower.   The US$ Index is flat as markets weighed the impact of Donald Trump’s impending return to the White House. US$
Index +0.05%, GBPUSD -0.3%, EURUSD -0.25%, USDJPY -0.3%, AUDUSD -0.8%, NZDUSD -0.5%, USDCHF -0.1%.

 

 

 

Spot Bitcoin +0.3%, Spot Ethereum +1.4%. 

 

 

 

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
    • Adtran Holdings (ADTN) Raised to Buy at Rosenblatt Securities Inc
    • AppLovin (APP) Raised to Outperform at Daiwa; PT $280
    • Bank of America (BAC) Raised to Buy at Citi
    • BCE (BCE CN) Raised to Reduce at Veritas Investment Research Co; PT C$40
    • BioNTech (BNTX) ADRs Raised to Buy at Goldman; PT $137
    • Bumble (BMBL) Raised to Buy at CFRA
    • Chewy (CHWY) Raised to Buy at Citi; PT $40
    • Coeur Mining (CDE) Raised to Speculative Buy at Cantor; PT $7.25
    • CoreCivic (CXW) Raised to Buy at JonesTrading; PT $28
    • Domino’s Pizza (DPZ) Raised to Buy at Loop Capital; PT $559
    • Doximity (DOCS) Raised to Equal-Weight at Wells Fargo; PT $41
      • Raised to Overweight at KeyBanc; PT $70
    • ECN Capital (ECN CN) Raised to Outperform at National Bank; PT C$3.25
    • EPAM Systems (EPAM) Raised to Outperform at Itau BBA; PT $269
    • Fluence Energy (FLNC) Raised to Neutral at BNPP Exane; PT $22
    • Home Depot (HD) Raised to Outperform at Telsey; PT $455
    • Innovative Industrial (IIPR) Raised to Buy at Compass Point; PT $125
    • International Flavors (IFF) Raised to Buy at BofA; PT $107
    • Lowe’s (LOW) Raised to Outperform at Telsey; PT $305
    • Molson Coors (TAP) Raised to Overweight at Wells Fargo
    • Orthofix (OFIX) Raised to Buy at Stifel; PT $24
    • PMV Pharma (PMVP) Raised to Outperform at Oppenheimer; PT $6
    • Royal Gold (RGLD) Raised to Buy at Cantor; PT $162
    • Superior Plus (SPB CN) Raised to Outperform at CIBC; PT C$8.50
    • Universal Electronics (UEIC) Raised to Buy at Rosenblatt Securities Inc
    • Upstart (UPST) Raised to Overweight at Piper Sandler; PT $85
    • Warby Parker (WRBY) Raised to Outperform at William Blair
    • Wingstop (WING) Raised to Buy at Goldman; PT $377
  • Downgrades
    • ACI Worldwide (ACIW) Cut to Neutral at DA Davidson; PT $60
    • Agilon Health (AGL) Cut to Market Perform at William Blair
    • Airbnb (ABNB) Cut to Hold at Punto Casa de Bolsa; PT $157.52
    • AMN Healthcare (AMN) Cut to Market Perform at William Blair
    • Arhaus (ARHS) Cut to Market Perform at Telsey; PT $11
      • Cut to Neutral at BofA; PT $11
    • Axcelis Technologies (ACLS) Cut to Hold at Benchmark
    • Bath & Body Works (BBWI) Cut to Underweight at Barclays; PT $28
    • Celanese (CE) Cut to Underweight at Piper Sandler; PT $98
    • Chorus Aviation (CHR CN) Cut to Hold at TD Cowen
    • Clearwater Analytics (CWAN) Cut to Neutral at DA Davidson; PT $35
    • Dream Residential REIT (DRR/U CN) Cut to Hold at Desjardins; PT $7.50
    • EnLink Midstream (ENLC) Cut to Market Perform at Raymond James
    • Enphase Energy (ENPH) Cut to Hold at HSBC; PT $81
      • Cut to Neutral at BNPP Exane; PT $88
    • Evolent (EVH) Cut to Equal-Weight at Stephens; PT $16
    • Installed Building (IBP) Cut to Underperform at RBC; PT $197
    • LegalZoom (LZ) Cut to Underweight at JPMorgan; PT $8
    • Maravai (MRVI) Cut to Market Perform at William Blair
    • Montrose Environmental (MEG) Cut to Neutral at JPMorgan; PT $29
    • Nerdy (NRDY) Cut to Neutral at Cantor; PT $1
      • Cut to Market Perform at JMP
    • Planet Fitness (PLNT) Cut to Neutral at Macquarie; PT $99
    • Plymouth (PLYM) Cut to Neutral at BNPP Exane; PT $23
    • Rivian (RIVN) Cut to Neutral at BofA; PT $13
    • Savers Value Village (SVV) Cut to Neutral at Piper Sandler; PT $10
    • Sealed Air (SEE) Cut to Sell at CFRA
    • Sunnova Energy (NOVA) Cut to Underperform at BNPP Exane; PT $3.50
    • Sunrun (RUN) Cut to Neutral at BNPP Exane; PT $14
    • Sweetgreen (SG) Cut to Neutral at Goldman; PT $40
    • WhiteHorse Finance (WHF) Cut to Market Perform at Raymond James
  • Initiations
    • ADC Therapeutics (ADCT) Rated New Overweight at Stephens; PT $6
    • Atour Lifestyle (ATAT) ADRs Rated New Buy at First Shanghai; PT $32.50
    • Bicycle Therapeutics (BCYC) ADRs Rated New Equal-Weight at Stephens
    • Cidara (CDTX) Rated New Buy at Guggenheim; PT $33
    • Cytokinetics (CYTK) Rated New Outperform at RBC; PT $80
    • DLP Resources (DLP CN) Rated New Buy at Fundamental Research
    • Immunome (IMNM) Rated New Overweight at Stephens; PT $30
    • Inhibikase Therapeutics (IKT) Rated New Buy at Jefferies; PT $8
    • Pyxis Oncology (PYXS) Rated New Overweight at Stephens; PT $13

 

 

 

 

 

 

Data sources: Bloomberg, Reuters, CQG

 

 

David Wienke

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