Daily Game Plan

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

TODAY’S ECONOMIC DATA:  9:45ET S&P Global US Manufacturing PMI, Services PMI; 10:00ET U. of Mich. Sentiment, Existing
Home Sales; 11:30ET Fed’s Jefferson speaks

Highlights and News:  

• Israeli PM Netanyahu says Hamas will pay for not returning body of Shiri Bibas
• DOJ Launches Investigation Into UnitedHealth Group’s Medicare Billing Practices: WSJ
• US, Ukraine Ramp Up Talks on Minerals Deal
• Trump plans to place the US Postal Service under the control of the Commerce Department
• SEC AGREES IN PRINCIPLE TO DISMISS CASE AGAINST COINBASE

Global stocks rose, led by gains in Asia, though gains were tempered by uncertainty over developments in Ukraine and the upcoming German elections. Prime Minister
Benjamin Netanyahu said that Israel would hold Hamas accountable for not releasing the body of hostage Shiri Bibas as agreed, signaling a possible new challenge to the month-old ceasefire in Gaza. Meanwhile, data showed business activity in Germany’s private
sector picked up slightly in February but contracted by much more than expected in France as backlogs in the services sector sharply declined. UK businesses stepped up the pace of job cuts in February, according to a closely watched survey. BofA strategist
Michael Hartnett reiterated a preference for global stocks to US peers, saying markets such as Germany, China, Japan and South Korea are more attractive at a time when business activity is improving.  

EQUITIES:  

US equity futures are mostly higher after the major averages slid following a lackluster earnings forecast from retail giant Walmart. Nasdaq 100 futures are gaining after strong earnings
from Alibaba Group fueled optimism over artificial intelligence. Still, the gains were capped as digital payments firm Block, software firm Akamai Technologies and EV maker Rivian Automotive declined in premarket trading after issuing weak guidance. Profit
outlooks for 2025 from US companies have been relatively subdued, strategists at JPMorgan Chase noted. UnitedHealth shares dropped premarket after the WSJ reported that the DOJ launched an investigation into the company’s Medicare billing practices.   

Futures ahead of the bell: E-Mini S&P +0.05%, Nasdaq +0.35%, Russell 2000 +0.5%, DJI -0.5%

In pre-market trading, US-listed Chinese stocks rise after Alibaba’s earnings offered a fresh boost to the China tech sector. Baidu (BIDU) +3%, JD.com (JD) +1.6%. Data
center providers gain as Alibaba pledged to increase capital spending to support its AI ambitions: Vnet (VNET) +6%. Akamai Technologies (AKAM) drops 9% after the infrastructure software company gave an outlook that is weaker than expected. Block (XYZ) falls
8% after the digital payments company gave a 2025 gross profit outlook slightly below estimates. Celsius Holdings (CELH) jumps 31% after the company said it would buy rival Alani Nutrition for $1.8 billion in cash and stock. Dropbox (DBX) drops 9% after the
document management software company reported fourth-quarter results. Five9 (FIVN) rises 15% after the software company’s earnings beat estimates. Floor & Decor Holdings Inc. (FND) climbs 9% after the retailer posted 4Q profit that beat estimates and same-store
sales were better than expected. Grid Dynamics Holdings (GDYN) soars 22% after the information technology services company provided revenue forecasts for the 1Q and year that topped expectations. Innodata (INOD) jumps 11% after the data engineering company
reported fourth-quarter revenue and earnings per share that beat. RingCentral (RNG) declines 3% after the communications software company gave an outlook that is weaker than expected. MercadoLibre (MELI) climbs 12% as Latin America’s most valuable company
far surpassed net income estimates in the final quarter of 2024. Nubank (NU) falls 8% after the digital bank reported fourth-quarter net income that missed consensus estimates. UnitedHealth Group (UNH) falls 7% after the WSJ reported that the DOJ has launched
an investigation into the company’s Medicare billing practices in recent months. Weave Communications (WEAV) slumps 15% after the infrastructure software company reported its fourth-quarter results and gave a forecast that is seen as conservative.

Real estate outperformed yesterday with XLRE vs SPY climbing above the 50dma.

European gauges edge higher, following strong gains in Asian markets. The Stoxx 600 Index is near highs of the day, helped by robust earnings from Standard Chartered
Plc and Air Liquide SA. StanChart shares climbed after announcing a $1.5 billion share buyback as earnings beat estimates. Chemicals are the best-performing sector, rising 1.8%, after Air Liquide SA increased its guidance. Novo Nordisk extended weekly gains
to 10%, as Handelsbanken reiterated its short-term buy rating on the firm’s supply optimism. About $4 billion flowed into European funds in the week through Feb. 19, the most since February 2022, according to a note from Bank of America. German private-sector
output improved more than anticipated ahead of Sunday’s election as the manufacturing recession eased. Stoxx 600 +0.5%, DAX +0.2%, CAC +0.4%, FTSE 100 +0.1%. Chemicals +1.9%, Food & Bev +1.4%, Construction +0.8%. Aro & Defense -0.5%, Energy -0.4%.

Shares in Asia rose, buoyed by a rally in technology shares as Chinese e-commerce giant Alibaba’s stellar results boosted investor sentiment. Bilibili and Lenovo Group
shares also climbed on better-than-expected results. AI chipmaker Cambricon Technologies Corp. rose by the daily limit of 20% to a record high. The MSCI Asia Pacific Index climbed 0.7% for a sixth-straight weekly advance. Equities in Hong Kong and mainland
China led gains around the region, with the Hang Seng Index hitting a three year high. Japanese stocks closed marginally higher after Bank of Japan Governor Ueda said he expects easy financial conditions to support the economy. Nissan Motor shares extend gains,
rising as much as 11% after a report in the Financial Times that a high-level Japanese group plans to seek investment from Tesla. Hang Seng Tech +6.5%, Hang Seng Index +4%, CSI 300 +1.3%, Taiwan +1%, Philippines +0.5%, Vietnam +0.3%, Nikkei 225 +0.3%, Indonesia
+0.2%, Singapore +0.05%, Kospi ~flat. ASX 200 -0.3%, Sensex -0.6%.

FIXED INCOME: 
 

Treasuries drift higher with the curve flatter, supported by a drop in oil and wider gains seen across bunds after French composite PMI data came in below forecasts.
US yields richer by 1.5bp to 2.5bp across the curve in a bull flattening move with 2s10s, 5s30s spreads tighter by 1bp and 1.2bp on the day; 10-year yield trades around 4.48%. US session focus includes manufacturing PMI and a consumer sentiment gauge.

METALS: 

Gold edges lower but is headed for an eighth consecutive weekly advance amid geopolitical and trade tensions. Bullion-backed exchange-traded funds have seen fast-rising
holdings, with over 16 tons added this week, putting them on course for the biggest weekly influx since 2023. The precious metal hit a fresh peak on Thursday amid fears that President Trump could unwind American support for Ukraine. Physical gold demand among
top consumers China and India remained negligible due to record high prices. Spot gold -0.25%, Silver -0.25%, Copper -0.5%.

ENERGY:   

Oil trades lower but is on track for weekly gains tied to supply worries, as crude continues to struggle to break out of a sideways trading pattern. WTI and Brent
have gained about 1.5% this week – the largest weekly advance since early January. Brent would be marking a second week of gains after three weeks of declines. WTI is set for its first week of gains after four weekly declines. On the demand front, JPMorgan
analysts expect cold weather in the U.S. and a post-holiday increase to industrial activity in China to contribute more demand in the coming week. WTI -0.7%, Brent -0.6%, US Nat Gas +1.5%, RBOB -0.6%.

CURRENCIES: 

In currency markets, the dollar traded stronger versus most G-10 peers, trimming weekly losses. The yen weakened after BOJ Governor Ueda signaled a readiness to quell
a surge in bond yields. It earlier touched a fresh 2025 high after data showed inflation accelerated 4% year on year, more than forecast. The euro weakened after purchasing manager data showed business activity in the region hardly grew in February, reinforcing
fears that the bloc remains mired in stagnation. US$ Index +0.3%, GBPUSD -0.2%, EURUSD -0.3%, USDJPY +0.5%, AUDUSD +0.25%, NZDUSD -0.1%, USDCHF +0.15%, USDCAD +0.15%, USDMXN +0.1%, USDSEK +0.1%.

Spot Bitcoin +0.8%, Spot Ethereum +2.7%.

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
• Alphabet (GOOGL) Raised to Buy at Punto Casa de Bolsa; PT $203.84
• Blue Owl Capital Corp (OBDC) Raised to Market Perform at KBW; PT $15.50
• Dream Residential REIT (DRR/U CN) Raised to Buy at Desjardins; PT $9.50
• First Industrial Realty (FR) Raised to Neutral at Goldman; PT $59
• Grab Holdings (GRAB) Raised to Overweight at JPMorgan; PT $5.60
• Lumen Technologies (LUMN) Raised to Equal-Weight at Wells Fargo; PT $5
• Stagwell (STGW) Raised to Overweight at Wells Fargo; PT $8
• Terreno Realty (TRNO) Raised to Buy at Goldman; PT $77
• Unity Software (U) Raised to Buy at HSBC; PT $34
• Downgrades
• Akamai (AKAM) Cut to Hold at TD Cowen; PT $98
• Cut to Neutral at Piper Sandler; PT $100
• Amalgamated Financial (AMAL) Cut to Neutral at Piper Sandler; PT $38
• Anglogold (AU) Cut to Hold at SBG Securities; PT $35.43
• Calibre Mining (CXB CN) Cut to Hold at Jefferies; PT C$3
• Cenovus (CVE CN) Cut to Sector Perform at National Bank; PT C$25
• Cheniere Energy Partners (CQP) Cut to Sell at Stifel; PT $51
• Integer (ITGR) Cut to Market Perform at Oppenheimer
• Jack in the Box (JACK) Cut to Neutral at Wedbush; PT $40
• Parsons (PSN) Cut to Hold at TD Cowen; PT $56
• Rivian (RIVN) Cut to Neutral at Cantor; PT $15
• Telus (T CN) Cut to Hold at Accountability Research; PT C$22.50
• TrueCar (TRUE) Cut to Neutral at JPMorgan
• Initiations
• AbraSilver Resource Corp (ABRA CN) Rated New Outperform at Raymond James
• Avalo Therapeutics (AVTX) Rated New Outperform at Wedbush; PT $18
• Celestica (CLS CN) Rated New Overweight at JPMorgan; PT C$235.55
• Firstsun Capital (FSUN) Rated New Overweight at Piper Sandler; PT $51
• Inventiva SACA (IVA FP) ADRs Rated New Buy at TD Cowen; PT $10
• Leon’s Furniture (LNF CN) Rated New Outperform at RBC; PT C$32
• OSI Systems (OSIS) Rated New Neutral at JPMorgan; PT $225
• Quanta Services (PWR) Rated New Buy at Roth Capital Partners; PT $350
• Telomir Pharmaceuticals (TELO) Rated New Buy at Rodman & Renshaw
• Vertiv Holdings (VRT) Rated New Buy at President Capital Management
• Vista Energy (VISTAA MM) ADRs Rated New Buy at Goldman; PT $65.40

Data sources: Bloomberg, Reuters, CQG

David Wienke