Daily Game Plan

by Contributor
on November 13, 2024

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

TODAY’S ECONOMIC DATA:  8:30ET CPI** core expected +0.3% m/m & 3.3% y/y, Fed’s Kashkari speaks on BTV; 9:30ET Fed’s
Williams speaks; 9:45ET Fed’s Logan speaks; 1:00ET Fed’s Musalem speaks; 1:30ET Fed’s Schmid speaks

CPI comes in as expected

Highlights and News:  

  • Biden and Trump to meet at White House for transition talks today
  • Republicans inch closer to US House majority; 216 seats out of 218 needed with 12 races uncalled
  • Republican senators will elect a new leader today
  • Trump picks Elon Musk and Vivek Ramaswamy to lead the new Department of Government Efficiency
  • US to Rush Aid to Ukraine Before Trump Takes Over, Secretary of State Blinken Says

 

Global stocks edged lower as investors awaited key US inflation data amid concerns that President-elect Donald Trump’s proposed ‘America-First’ policies will reignite
price growth.  An MSCI gauge of equities excluding the US is posting its worst day in three months. Sales of global luxury goods are set to fall 2% this year, making it one of the weakest on record, according to consultancy Bain & Company. Trump’s trade levies
may cost Germany 1% of economic output if implemented, Bundesbank President Nagel said today. Japan’s wholesale inflation accelerated by 3.4% in October, the fastest annual pace in more than a year, complicating the Bank of Japan’s decision on how soon to
raise interest rates.

 

EQUITIES:  

US equity futures are trying to turn green after the CPI data following a slew of corporate earnings had them on the defensive overnight. Focus today will be on a fresh read on US inflation,
with the October Consumer Price Index report due ahead of the open. Meanwhile, Republicans inched closer to gaining full control of Congress, which would give the president-elect more power to advance his agenda. President-elect Trump picked Elon Musk and
Vivek Ramaswamy to lead the new Department of Government Efficiency. Tesla rallied in premarket trading, as did biotech firm Roivant Sciences which was founded by Ramaswamy.

Futures after the data: E-Mini S&P +.15%, Nasdaq +0.1%, Russell 2000 +0.7%, DJI +0.05%. 

In pre-market trading, Rivian Automotive (RIVN) jumped 9% after Volkswagen said it plans to invest up to $5.8 billion in the electric-vehicle maker, more than the $5
billion the companies agreed to when the joint venture was announced in June.  US space-launch company Rocket Lab USA (RKLB) rose 28% after its fourth-quarter revenue forecast was fueled by more scheduled Electron rocket launches. Spirit Airlines (SAVE) plunged
70% after the Wall Street Journal reported the airline was preparing to file for bankruptcy protection after merger discussions with Frontier Group Holdings (ULCC) fell apart.  Super Micro Computer (SMCI) declined 3.5% after the server maker said it needs
additional time to file its 10-Q form for earnings in the quarter ended September 30. Spotify Technology S.A (SPOT) rose 8% after the audio streaming service reported third-quarter earnings. Cava Group (CAVA) jumped 17% after the casual restaurant chain posted
third-quarter earnings that beat. Skyworks Solutions (SWKS) fell 6% after the semiconductor company posted fourth-quarter earnings that beat but issued guidance that missed forecasts. Mara Holdings (MARA), the cryptocurrency mining company, was down 8.5% after
reporting a third-quarter loss of 42 cents a share. Rocket Cos. (RKT), the parent company of home loan originator Rocket Mortgage, fell 10% after posting a third-quarter loss. Genetic testing services company, Natera (NTRA) fell 13% after reporting a narrower-than-expected
third-quarter loss on a revenue jump of 64%. Chegg (CHGG) tumbles 15% after the education technology company gave a fourth-quarter forecast that was weaker than expected. Dave Inc. (DAVE) rises 34% after the financial services firm boosted its full-year revenue
outlook. Groupon (GRPN) tumbles 20% after the shopping deals website cut its adjusted Ebitda guidance for the full year. Instacart (CART) falls 7% after the online grocery delivery company gave a weaker-than-expected fourth-quarter Ebitda forecast.

 

European gauges are lower for a second straight day as jitters around a possible resurgence in US inflation dented risk appetite.  The Stoxx 600 index erased earlier
modest gains to trade half a percent lower as technology shares lead declines while energy sector outperforms. Siemens Energy AG surged as much as 20% after the German firm raised its mid-term targets amid growing demand for its grid technologies. Power generator
RWE AG rose 8% after saying it would buy back as much as €1.5 billion ($1.6 billion) of shares. Among other notable movers, Just Eat Takeaway.com NV surged 17% as it is selling restaurant delivery service Grubhub to Wonder Group. With the earnings season drawing
to a close, Barclays Plc strategists warned companies remain cautious about the economic outlook. Stoxx 600 -0.5%, DAX -0.4%, CAC -0.4%, FTSE 100 -0.2%. Energy +0.7%, Banks +0.3%. Technology -1.6%.

Shares in Asia were mostly lower with the MSCI Asia Pacific Index declining 1.1% as resurgent yields quash risk sentiment across Asia.  South Korea led losses in the
region as global funds sold shares in companies that are vulnerable to Trump’s protectionist trade policy.  Stocks in China were choppy before closing higher. China announced tax cuts for home purchases in fiscal policy support. Hong Kong erased a drop of
as much as 1.3% to close little changed. Tencent revenue rose 8%, buoyed by the summer release of Dungeon & Fighter Mobile.  Kospi -2.6%, Nikkei 225 -1.7%, Philippines -1.4%, Sensex -1.25%, Topix -1.2%, ASX 200 -0.75%, Taiwan -0.5%, Hang Seng Index -0.1%.
Vietnam +0.1%, Singapore +0.2%, Thailand +0.4%, CSI 300 +0.6%. 

FIXED INCOME: 
 

Treasuries fluctuate after Tuesday’s sharp selloff ahead of key US inflation data.  Fed President Neel Kashkari said Tuesday that he’ll watch the US inflation data
closely to determine whether another rate cut is appropriate at the December meeting. Traders are pricing in about two rate cuts through June, compared with almost four seen at the start of last week. Japan’s 5-year yield hit its highest since 2009 as producer
prices rise at fastest pace in 14 months. US 10-year yield is nearly flat around 4.42%. 2s10s spread is slightly flatter after it steepened 3.5bp in Tuesday’s selloff. 

 

 

 

METALS: 

Gold edged higher following a bruising run that came after Donald Trump’s election win spurred a rally in the dollar. Hedge funds have been unwinding bullish wagers
on the precious metal and exchange-traded fund flows turned less supportive amid a widespread rotation into US equities. Investors will look to the US core consumer price index report due early this morning for clues on the Fed’s next steps on rates. Spot
gold +0.4%, Silver +0.5%, Copper -0.2%.

 

 

 

ENERGY:   

 

Oil prices are edging higher amid signs of supply tightness but remain near two-week lows after OPEC cut its demand-growth estimates once again.  Morgan Stanley cut
its Brent price forecast for 2025 on a possible glut. It also lowered its demand growth forecast. Traders will now be focusing on US inflation data today for cues on the path of interest rates, as well as the IEA’s oil-demand forecast set to be released on
Thursday.  WTI +0.3%, Brent +0.3%, US Nat Gas -2.3%, RBOB +0.4%.

 

 

CURRENCIES: 

In currency markets, early dollar strength overnight pushed the yen briefly beyond 155 per dollar for the first time since July, raising the risk that Japan will
intervene to slow the depreciation. The US$ Index has risen ~6% from its late September low. Brazil’s central bank is stepping into the market with an FX credit-line auction of as much as $4 billion today to support the real. Aussie dollar is lower after data
showed slower wage growth in the third quarter. US$ Index -0.1%, GBPUSD -0.05%, EURUSD +0.05%, USDJPY +0.25%, AUDUSD -0.2%, NZDUSD -0.05%, USDCHF +0.1%.

 

 

 

Spot Bitcoin -0.7%, Spot Ethereum -3.5%. Bitcoin paused its record-breaking climb, down about 1% after hitting an all-time high of $89,998 on Tuesday. Trump has vowed
to make the U.S. “the crypto capital of the planet”. Trump said Elon Musk will co-lead Department of Government Efficiency and the acronym of the newly created department – DOGE – references the name of the cryptocurrency dogecoin that Musk promotes.

 

 

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
    • BankUnited (BKU) Raised to Overweight at Wells Fargo; PT $48
    • Bristol Myers (BMY) Raised to Outperform at Daiwa; PT $65
    • CCC Intelligent Solutions (CCCS) Raised to Overweight at Morgan Stanley
    • Cummins (CMI) Raised to Outperform at Evercore ISI
    • Equity Residential (EQR) Raised to Buy at Stifel
    • On Holding (ONON) Raised to Buy at Williams Trading; PT $60
      • Raised to Buy at BTIG; PT $64
    • Paccar (PCAR) Raised to Outperform at Evercore ISI
    • Pfizer (PFE) Raised to Buy at CFRA; PT $30
    • Timken (TKR) Raised to Outperform at Evercore ISI
    • Tyson (TSN) Raised to Buy at CFRA
    • Viant (DSP) Raised to Buy at Canaccord; PT $18
  • Downgrades
    • 908 Devices (MASS) Cut to Market Perform at Leerink; PT $4
    • Adams Resources & Energy (AE) Cut to Neutral at B Riley; PT $38
    • Advanced Drainage (WMS) Cut to Equal-Weight at Stephens; PT $135
    • Angi Inc (ANGI) Cut to Neutral at Citi
      • Cut to Neutral at Goldman; PT $2.50
    • Arch Resources (ARCH) Cut to Hold at Jefferies; PT $165
    • BioAtla (BCAB) Cut to Neutral at HC Wainwright
    • Camden Property (CPT) Cut to Hold at Stifel
    • CareCloud Inc (CCLD) Cut to Neutral at Roth Capital Partners; PT $3.50
    • Caterpillar (CAT) Cut to Underperform at Evercore ISI; PT $365
    • Computer Modelling Group (CMG CN) Cut to Hold at Canaccord; PT C$12
    • Coty (COTY) Cut to Hold at TD Cowen; PT $8.50
    • Doximity (DOCS) Cut to Hold at Canaccord; PT $60
    • Eaton Corp (ETN) Cut to Inline at Evercore ISI
    • Esab (ESAB) Cut to Underperform at Evercore ISI
    • Fortinet (FTNT) Cut to Hold at Punto Casa de Bolsa; PT $105.27
    • Illinois Tool (ITW) Cut to Underperform at Evercore ISI
    • International Paper (IP) Cut to Underperform at BNPP Exane; PT $48.20
    • Progyny (PGNY) Cut to Hold at Truist Secs; PT $19
    • RAPT Therapeutics (RAPT) Cut to Hold at Stifel; PT $2
    • Rockwell Automation (ROK) Cut to Neutral at UBS
    • Savara (SVRA) Cut to Inline at Evercore ISI; PT $5
    • Shopify (SHOP CN) Cut to Sector Perform at ATB Capital; PT C$145
    • Soundhound (SOUN) Cut to Neutral at Ladenburg Thalmann; PT $7
    • Spotify (SPOT) Cut to Accumulate at Phillip Secs; PT $485
    • Starbucks (SBUX) Cut to Sell at Redburn; PT $77
    • Syros Pharmaceuticals (SYRS) Cut to Neutral at HC Wainwright; PT $1
      • Cut to Market Perform at JMP
      • Cut to Hold at TD Cowen
      • Cut to Hold at Brookline Capital
    • Teekay Tankers (TNK) Cut to Underperform at BofA; PT $46
    • Tesla (TSLA) Cut to Sell at Phillip Secs; PT $230
  • Initiations
    • Actuate Therapeutics (ACTU) Rated New Buy at Lucid Capital Markets
    • Airship AI (AISP) Rated New Buy at Benchmark; PT $6
    • Amer Sports (AS) Rated New Overweight at Guotai Junan Sec
    • America’s Car-Mart (CRMT) Rated New Equal-Weight at Stephens; PT $50
    • Atlanticus (ATLC) Rated New Overweight at Stephens; PT $54
    • Cargo Therapeutics (CRGX) Rated New Buy at Lucid Capital Markets
    • Commvault Systems Inc (CVLT) Reinstated Outperform at Oppenheimer
    • Emerson Electric (EMR) Rated New Outperform at BNPP Exane; PT $155
    • Enova International (ENVA) Rated New Overweight at Stephens; PT $108
    • Exelixis (EXEL) Rated New Neutral at Lucid Capital Markets; PT $39
    • Ezcorp (EZPW) Rated New Equal-Weight at Stephens; PT $13
    • FirstCash (FCFS) Rated New Overweight at Stephens; PT $137
    • Jumia (JMIA) ADRs Reinstated Sector Perform at RBC; PT $5
    • Katapult (KPLT) Rated New Equal-Weight at Stephens; PT $9
    • NetApp Inc (NTAP) Reinstated Market Perform at Oppenheimer
    • Nurix (NRIX) Rated New Buy at Lucid Capital Markets; PT $35
    • Nutanix (NTNX) Rated New Outperform at Oppenheimer; PT $80
    • OneMain (OMF) Rated New Overweight at Stephens; PT $62
    • Penn Entertainment Inc (PENN) Reinstated Neutral at BofA; PT $22
    • PROG Holdings (PRG) Reinstated Overweight at Stephens; PT $60
    • Propel Holdings (PRL CN) Rated New Overweight at Stephens; PT C$43
    • Pure Storage (PSTG) Rated New Outperform at Oppenheimer; PT $70
    • Regional Management (RM) Rated New Overweight at Stephens; PT $38
    • Rockwell Automation (ROK) Rated New Outperform at BNPP Exane; PT $345
    • Rubrik (RBRK) Rated New Market Perform at Oppenheimer
    • World Acceptance (WRLD) Rated New Equal-Weight at Stephens; PT $110

 

 

 

 

 

 

Data sources: Bloomberg, Reuters, CQG

 

 

David Wienke

Categories:

Charts

Tags:

aucldxesngqqqsp500tyusdvixwtiX

Comments are closed