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; 10:00ET Construction Spending, ISM Mfg; 12:35ET
Fed’s Musalem speaks

Highlights and News:  

• The ECB is expected to cut rates this week
• Commerce Secretary Lutnick suggests levies on Mexico and Canada imports could be lower than 25%
• Zelenskiy Says Willing to Meet Trump Again
• Andrew Cuomo said he is running for mayor of New York City
• TRUMP: TOMORROW NIGHT WILL BE BIG, I WILL TELL IT LIKE IT IS!

World stocks moved higher after European leaders agreed to draw up a Ukraine peace plan to present to the United States. French President Macron said that the plan
would involve a one-month ceasefire that would apply to air and sea attacks but not to ground combat. Earlier, Zelenskiy told reporters that Ukraine would not cede any territory to Russia as part of a peace agreement and said he was still willing to sign a
minerals deal with the United States. China is considering retaliatory measures on US agriculture and food products in response to tariffs set to hit tomorrow, the Global Times reported. Thousands of delegates will gather mid-week for an important policy meeting
in Beijing, where analysts are calling for more stimulus. Meanwhile, data showed euro-area inflation eased to 2.4% in February, down from 2.5% in January, ahead of an expected ECB rate cut this week.    

EQUITIES:  

US equity futures are higher on renewed uncertainty over whether or not imminent US tariffs would go ahead. Commerce Secretary Lutnick said Sunday that the exact tariff that will be levied
against Mexico and Canada starting Tuesday is still “fluid,” adding that the additional 10% duty on China imports is “set.” Treasury Secretary Bessent said over the weekend that Mexico has offered to match the US tariffs on China, potentially as a way to get
out of the tariffs set to be imposed against them. Tesla led premarket gains among the Magnificent Seven stocks after recording its biggest monthly decline in about two years.

Futures ahead of the bell: E-Mini S&P +0.4%, Nasdaq +0.6%, Russell 2000 +0.6%, DJI +0.2%

In pre-market trading, Allegro MicroSystems (ALGM) gains 14% after the semiconductor devices company is said to be drawing takeover interest from larger competitor
ON Semiconductor. AppLovin (APP) shares rise 6% after the marketing services company modified the current limit of its share repurchase program. AST SpaceMobile (ASTS) jumped as much as 8.8% in premarket trading after the company signed an agreement with Vodafone
to create a jointly-owned European satellite service business. Aurora Innovation (AUR) shares rise 5.0% after Morgan Stanley initiated coverage of the stock with an overweight rating. Capri Holdings (CPRI) shares climb 7.2% as Prada is said to be moving closer
to a deal to buy Versace. Chipotle Mexican Grill (CMG) shares gain 2.4% after the restaurant operator was upgraded to overweight from equal-weight at Morgan Stanley. Lexicon Pharmaceuticals (LXRX) shares were down as much as 57% after reporting a lack of separation
in ADPS reduction between Pilavapadin’s 20 mg dose arm and placebo.

SPX held the weekly trendline on Friday.

Consumer Discretionary sector has underperformed Staples since January 23 by nearly 15%.

European gauges moved broadly higher with defense stocks leading gains as a concerted push by regional leaders to demonstrate broad support for Ukraine fueled bets
on a wave of military spending.  Many defense stocks are posting double-digit gains. Rheinmetall AG and Dassault Aviation SA rose as much as 19% while Saab AB advanced 15% at one point in early trading. A Goldman Sachs Group basket of European defense stocks
rose as much as 16% to a record. It’s up over 50% so far this year. Autos subindex jumped 2% as European Commission President Ursula von der Leyen said the bloc would grant carmakers a three-year window in which to hit carbon dioxide emissions targets. Euro-area
inflation eased, with consumer prices rising 2.4% from a year earlier in February, down from 2.5% in January. Closely watched services inflation dipped to 3.7%, the first major retreat from 4% since April 2024. Stoxx 600 +1.2%, DAX +2.7%, CAC +1.6%, FTSE 100
+0.9%. Industrial Goods +3%, Basic Resources +2.3%, Autos +2.1%, Technology +1.7%. Real Estate -1.1%, Utilities -0.9%.

Shares in Asia rose, with Indonesia’s stock gauge leading gains in the region after JPMorgan upgraded the nation’s banks. The MSCI Asia Pacific Index advanced 0.7%,
with China’s Tencent and Alibaba among the biggest contributors ahead of the nation’s annual national parliament meeting. Mainland China stocks erased gains of as much as 1% to end the day little changed. Investors will be watching the Two Sessions for Beijing’s
plan to counter risk from US tariffs after Trump threatened to add an additional 10% levy from Tuesday. Chinese financial regulators told private companies in a meeting that they will increase credit to private and small firms, according to a statement posted
by the PBOC.  Elsewhere, Taiwanese stocks fell, weighed by TSMC, as trading resumed after a holiday. Korea’s market was shut for a holiday. Indonesia +4%, Topix +1.8%, ASX 200 +0.9%, Philippines +0.6%, Singapore +0.3%, Hang Seng Index +0.3%. CSI 300 -0.05%,
Sensex -0.1%, Hang Seng Tech -0.6%, Thailand -1.3%, Taiwan -1.3%.

FIXED INCOME: 
 

Treasuries are cheaper as US trading gets under way, following bigger losses in core European rates. Data showing euro-area inflation decelerated less than expected
in February contributed to the selloff during London morning. US yields are 3bp-4bp higher across maturities with curve spreads slightly steeper but within 1bp of Friday’s closing levels; 10-year is around 4.245%.  

METALS: 

Gold rose after last week’s sharp correction, with investors weighing the economic outlook as President Trump prepares to implement import levies against key trade
partners. Bullion traded above $2,875 an ounce, while the dollar fell. Spot gold +0.5%, Silver +0.5%, Copper +1.5%.

ENERGY:   

Oil edged higher, finding support from improved economic data from China, though upside remains capped by President Trump’s tariff plans. Traders are trying to navigate
uncertainty around the prospects for a Ukraine peace deal after Friday’s public clash between Trump and President Zelensky in the Oval Office. In China, the Caixin purchasing-managers index rose to 50.8 in February from 50.1 in January, the strongest reading
since November and a sign of marginally accelerating activity. WTI +0.5%, Brent +0.4%, US Nat Gas +1.2%, RBOB +0.3%.    

CURRENCIES: 

In currency markets, the euro surged on expectations for a big boost to defense spending. The Polish zloty and Hungarian forint led gains among emerging-market currencies.
The Swedish krona, seen as a big beneficiary of increased military spending in Europe, strengthened more than 1% against the dollar.  The gains come after UK Prime Minister Keir Starmer said Britain, France and “one or two others” would work to secure Ukraine
as concerns of a US pullback deepen. Meanwhile, the two parties likely to form Germany’s next government are exploring options for large-scale investments in defense and infrastructure as Europe eyes massive spending to boost the continent’s security. US$
Index -0.7%, GBPUSD +0.8%, EURUSD +0.8%, USDJPY +0.4%, AUDUSD +0.3%, NZDUSD +0.2%, USDCHF -0.3%, USDCAD -0.3%, USDSEK -1.1%.    

Bitcoin pared some of yesterday’s rally, after Trump announced his plan for a strategic crypto reserve. Trump said in a post on Truth Social that his January executive
order on digital assets would create a stockpile of currencies including bitcoin , ether , XRP , Solana and Cardano .

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
• ACNB (ACNB) Raised to Overweight at Piper Sandler
• BeiGene (ONC) ADRs Raised to Buy at BofA; PT $320
• Bowhead Specialty (BOW) Raised to Outperform at KBW; PT $44
• Charles River (CRL) Raised to Neutral at Redburn; PT $188
• Check Point Software (CHKP) Raised to Overweight at Piper Sandler
• Chipotle (CMG) Raised to Overweight at Morgan Stanley; PT $70
• Docebo (DCBO CN) Raised to Outperform at ATB Capital; PT C$75
• Gray Media (GTN) Raised to Equal-Weight at Wells Fargo; PT $4
• Intra-Cellular (ITCI) Raised to Buy at Canaccord; PT $132
• Kinder Morgan (KMI) Raised to Overweight at Barclays; PT $31
• Melco Resorts (MLCO) ADRs Raised to Overweight at Morgan Stanley
• Middlesex Water (MSEX) Raised to Outperform at Baird; PT $61
• Mosaic (MOS) Raised to Overweight at JPMorgan; PT $29
• MYT Netherlands Parent (MYTE) ADRs Raised to Buy at TD Cowen
• Trulieve Cannabis (TRUL CN) Raised to Speculative Buy at Cormark Securities; PT C$15
• UWM Holdings (UWMC) Raised to Outperform at KBW; PT $7.50
• Vivo (VIVT3 BZ) ADRs Raised to Overweight at Barclays; PT $11.50
• Downgrades
• AGCO (AGCO) Cut to Neutral at Baird; PT $100
• Air Canada (AC CN) Cut to Neutral at JPMorgan; PT C$24
• CNH Industrial (CNH) Cut to Neutral at Baird; PT $15
• Deere (DE) Cut to Neutral at Baird; PT $501
• Dollar General (DG) Cut to Hold at Deutsche Bank; PT $80
• DoubleVerify (DV) Cut to Neutral at Cannonball Research; PT $14
• Fox Corp (FOXA) Cut to Neutral at Arete; PT $66
• FTAI Aviation (FTAI) Cut to Neutral at Stifel; PT $123
• Interfor (IFP CN) Cut to Sector Perform at Scotiabank; PT C$22.50
• Kimbell Royalty Partners (KRP) Cut to Market Perform at Raymond James
• Praxis Precision (PRAX) Cut to Underperform at Wedbush; PT $26
• Sempra (SRE) Cut to Hold at Jefferies; PT $77
• Southwest Air (LUV) Cut to Underweight at JPMorgan; PT $25
• Tandem Diabetes (TNDM) Cut to Market Perform at Bernstein(Earlier)
• Cut to Equal-Weight at Wells Fargo; PT $22
• Zai Lab (ZLAB) ADRs Cut to Neutral at BofA
• Initiations
• Airbus (AIR FP) ADRs Rated New Buy at President Capital Management
• Amplitude (AMPL) Rated New Buy at Needham; PT $16
• Aurora Innovation (AUR) Rated New Overweight at Morgan Stanley; PT $12
• DMG Blockchain Solutions Inc (DMGI CN) Rated New Buy at Roth Capital Partners
• Enphase Energy (ENPH) Rated New Neutral at Redburn; PT $61
• First Solar (FSLR) Rated New Neutral at Redburn; PT $150
• Immunovant (IMVT) Rated New Hold at Jefferies; PT $20
• NiSource (NI) Rated New Outperform at Haitong Intl; PT $47.73
• Sandisk (SNDK) Rated New Overweight at Morgan Stanley; PT $84
• TuHURA Biosciences Inc (HURA) Rated New Buy at HC Wainwright; PT $13

Data sources: Bloomberg, Reuters, CQG

David Wienke