Daily Game Plan

by Contributor
on March 7, 2025

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

TODAY’S ECONOMIC DATA:  8:30ET Employment Report; 10:15ET Fed’s Bowman speaks; 10:45ET Fed’s Williams speaks; 12:20ET
Fed’s Kugler speaks; 1:00ET Kugler speaks again; 12:30ET Fed’s Powell speaks; 3:00ET Consumer Credit  

US FEB. NONFARM PAYROLLS RISE 151,000 M/M; EST. +160K

Highlights and News:  

  • Fed’s Waller Still Sees Potential for Two to Three Cuts in 2025
  • Trump promises “scalpel rather than the hatchet” in cuts to federal workforce – Axios
  • China’s imports unexpectedly shrank over Jan-Feb
  • Trump Steps Up Pressure on Iran to Negotiate on Nuclear Program
  • Mexico to Review Tariffs on Chinese Imports

 

World stocks slipped as investors remain edgy at the end of a week marked by confusion over US trade policy and a global rise in borrowing costs, although a steep
selloff in bonds subsided. Data today showed China’s imports unexpectedly shrank in January and February. Analysts say the slump in imports signals Beijing has begun scaling back purchases of key commodities. China’s exports hit a record $540 billion in the
first two months of 2025 as tariffs drove the frontloading of shipments. The euro-area economy grew 0.2% at the end of last year, more than initially estimated, bolstered by consumer spending and corporate investments. German factory orders fell 7% in January,
a far bigger drop than expected and the most in a year. Mexico will review its levies on Chinese shipments, President Claudia Sheinbaum said.

 

EQUITIES:  

US equity futures make small gains as traders await monthly payrolls data for the latest clues on the economy’s health. Broadcom, a chip supplier for Apple and other big tech companies,
surged post-market after AI growth fueled an upbeat forecast. All eyes are on the US jobs report this morning, which is expected to show job creation picked up, adding 160,000 jobs and the unemployment rate held steady in February at 4%. The whisper number
is around 122,000. Investors will turn focus to a slew of fed speakers and a speech from Federal Reserve Chair Jerome Powell, due later in the day, which could provide more clarity on the outlook for interest rates. 

Futures ahead of the bell/data: E-Mini S&P +0.01%, Nasdaq +0.1%, Russell 2000 +0.3%, DJI -0.02%

In pre-market trading, Walgreens Boots Alliance (WBA) is trading +4.5% higher after the US drugstore chain agreed to be purchased by Sycamore Partners for $10 billion.
Gap (GAP) jumps as much as 19% after the retailer’s sales beat estimates. Bigbear.ai shares (BBAI) are down 14% after the software company reported fourth-quarter results that are weaker than expected. Samsara shares (IOT) are down 9% after the software company
gave an outlook that is seen as underwhelming in the face of near-term uncertainty.

SPY held its 200dma and the high yield ETF (HYG) relative to the S&P 500 is also at its pivotal
200dma.

Semiconductors have been struggling the last few months. The 50 day moving avg is right on the 200 day and if it breaks below (death cross) would signal downside
momentum shift.

European gauges are lower following a broadly weaker session for Asian stocks as President Trump’s shifting approach to trade tariffs dampens risk sentiment. The Stoxx
600 is on track for a weekly loss after ten straight weeks of gains. Luxury stocks and miners lead losses today on disappointing Chinese export data, while telecom outperforms. The euro-area economy grew 0.2% at the end of last year, twice the pace initially
estimated. Bayer shares slid as much as 10% on plans to seek shareholder approval to raise 35% of its current share capital in case it needs funds quickly to resolve US legal troubles. Universal Music Group NV shares rallied 4% after the record label’s sales
beat estimates. Luxury-goods maker Salvatore Ferragamo SpA sank 16%, heading for its biggest slump on record, after reporting a wider-than-expected loss. Stoxx 600 -0.7%, DAX -1.8%, CAC -1.2%, FTSE 100 -0.5%. Luxury -2.5%, Basic Resources -2.1%, Autos -2%.
Telecom +0.5%, Utilities +0.2%.

EWG relative to SPY: first time above the 200 week mvg avg since April 2011

Shares in Asia fell after President Trump’s whipsaw tariff announcements added uncertainty to global markets, with Japan and Australia leading declines. The MSCI AC
Asia Pacific Index slid 0.9% but still capped its best week since September. Japan’s export-sensitive electronic stocks, Sony Group and Nintendo, were among the biggest drags on the regional gauge. Chinese stocks fell after data showed imports for January
through February that missed estimates, further complicating the outlook for its economic recovery. Next week, traders will be watching Japan’s gross domestic product figures, as well as China and India’s inflation rates. Nikkei 225 -2.2%, ASX 200 -1.8%, Taiwan
-0.6%, Hang Seng Index -0.6%, Kospi -0.5%, CSI 300 -0.3%, Singapore -0.1%, Sensex was flat. Indonesia +0.3%, Vietnam +0.6%, Thailand +1%, Philippines +1.3%.

FIXED INCOME: 
 

Treasuries are slightly richer across the curve in muted price action ahead of the February jobs report.  Fed Governor Waller said he wouldn’t support lowering interest
rates in March, but sees room to cut two, or possibly three, times this year. German bonds stabilize following the worst selloff in decades, aided by weaker-than-expected factory-orders data. Fed speaker slate includes Chair Powell speaking on the economic
outlook. US afternoon may see elevated swaps activity driven by hedging for expected rebound in corporate new-issue activity Monday. US yields are 2bp-4bp richer across maturities with 10-year around 4.25%. The curve is slightly flatter.

 

METALS: 

Gold inches higher and is on track for a weekly gain, with traders seeking havens after new US tariffs whipsawed markets and fueled uncertainty about the economic
outlook. Traders will parse nonfarm payrolls data this morning for any further signs of a slowing labor market, which would boost the odds of more Fed rate cuts. Spot gold +0.1%, Silver -0.8%, Copper -1.6%.

 

 

ENERGY:   

 

Oil prices rose but were set for close to a 4% weekly decline as uncertainty surrounding U.S. tariff policies raised concern over demand growth while major producers
prepared to increase output. Crude oil found some support after Russia’s deputy prime minister reportedly said OPEC+ could reverse its decision to begin increasing production next month if the market appears unbalanced. Saudi Aramco will lower the price for
its Arab Light crude to Asia for April by 40 cents a barrel — the first reduction in three months — as OPEC+ begins to ease restrictions on production. The cut is larger than anticipated by traders and refiners. China’s crude imports fell 5% on-year in January
and February, after record shipments of coal and gas in 2024 created an overhang of supply.  The US energy chief plans to seek $20B to refill the oil reserve. WTI +1.7%, Brent +1.6%, US Nat Gas -2.2%, RBOB +1.3%. 

 

CURRENCIES: 

In currency markets, the euro extends its post-ECB rally and is set for its best week since 2009 on Germany’s historic shift toward increased spending.  The dollar
fell against most Group-of-10 peers and headed for its worst week in more than two years amid speculation that stalling US growth momentum will prompt the Federal Reserve to resume policy easing. The Swedish krona is one of the best performing G-10 currencies
as economists adjust their Riksbank calls in light of Thursday’s upside inflation surprise. The Swiss franc also rises, aided by haven demand. The yen edges higher, touching its highest level against the dollar since early October. Bank of Japan officials
are leaning toward keeping interest rates unchanged this month after their hike in January and as growing uncertainties in the global economy require close attention, according to sources. US$ Index -0.3%, GBPUSD +0.2%, EURUSD +0.6%, USDJPY -0.2%, AUDUSD -0.6%,
NZDUSD -0.4%, USDCHF -0.3%, USDCAD +0.25%, USDSEK -0.7%.

 

 

Bitcoin -0.5%, Ethereum -1.1%. Bitcoin retreated as details of a US strategic reserve disappointed investors.  Trump signed an executive order on Thursday to establish
a so-called strategic bitcoin reserve, built using tokens already owned by the U.S. government that were forfeited during criminal or civil asset forfeiture proceedings. BESSENT: FIRST THING TO DO IS STOP GOVERNMENT BITCOIN SELLING.

 

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
    • American Public (APEI) Raised to Outperform at William Blair
    • Applied Opto (AAOI) Raised to Neutral at B Riley; PT $13
    • Array (ARRY) Raised to Buy at Guggenheim; PT $10
    • Badger Infrastructure Solutions Ltd (BDGI CN) Raised to Buy at Acumen
    • Bank of America (BAC) Raised to Outperform at Baird; PT $50
    • Dayforce (DAY) Raised to Buy at TD Cowen; PT $68
    • Huntington Bancshares (HBAN) Raised to Outperform at Baird; PT $18
    • JPMorgan (JPM) Raised to Outperform at Baird; PT $220
    • Logitech (LOGN SW) Raised to Outperform at Wedbush; PT $125
    • Sea Ltd (SE) ADRs Raised to Neutral at Phillip Secs; PT $140
    • Steel Dynamics (STLD) Raised to Overweight at Morgan Stanley; PT $158
    • Trade Desk (TTD) Raised to Hold at Benchmark
    • Viavi (VIAV) Raised to Buy at Rosenblatt Securities Inc; PT $14
    • Wayfair (W) Raised to Buy at Jefferies; PT $47
    • Zscaler (ZS) Raised to Buy at BofA; PT $240
  • Downgrades
    • Aecon Group (ARE CN) Cut to Hold at Stifel Canada; PT C$19
    • Air Lease (AL) Cut to Underperform at BofA
    • Macy’s (M) Cut to Neutral at JPMorgan; PT $14
      • Cut to Hold at Gordon Haskett; PT $13
    • Neumora Therapeutics (NMRA) Cut to Hold at Stifel; PT $2
    • South Bow (SOBO CN) Cut to Peerperform at Wolfe
      • Cut to Neutral at CIBC; PT C$35.76
    • Traeger (COOK) Cut to Market Perform at Telsey; PT $2.50
  • Initiations
    • American Axle (AXL) Rated New Hold at TD Cowen; PT $5
    • Ardelyx (ARDX) Reinstated Buy at Ladenburg Thalmann; PT $11
    • Autoliv (ALV) Rated New Buy at TD Cowen; PT $116
    • C.H. Robinson (CHRW) Reinstated Buy at Deutsche Bank; PT $129
    • Cipher Mining (CIFR) Rated New Buy at Rosenblatt Securities Inc
    • Coinbase (COIN) Rated New Buy at Rosenblatt Securities Inc; PT $305
    • CorMedix (CRMD) Rated New Outperform at Leerink; PT $18
    • CSX (CSX) Reinstated Hold at Deutsche Bank; PT $34
    • FedEx (FDX) Reinstated Buy at Deutsche Bank; PT $337
    • Flagship Communities REIT (MHC/U CN) Rated New Buy at TD Cowen; PT $19
    • Ford (F) Rated New Hold at TD Cowen; PT $10
    • General Motors (GM) Rated New Buy at TD Cowen; PT $105
    • GH Research (GHRS) Rated New Outperform at RBC; PT $31
    • Goodyear (GT) Rated New Buy at TD Cowen; PT $14
    • GXO Logistics (GXO) Reinstated Hold at Deutsche Bank; PT $45
    • Hims & Hers Health (HIMS) Rated New Buy at First Shanghai; PT $66
    • Hive Digital Technologie (HIVE CN) Rated New Buy at Rosenblatt Securities Inc; PT C$8.58
    • Hub Group (HUBG) Rated New Hold at Deutsche Bank; PT $41
    • Hut 8 Corp (HUT CN) Rated New Buy at Rosenblatt Securities Inc
    • JB Hunt (JBHT) Reinstated Hold at Deutsche Bank; PT $167
    • JD.com (JD) ADRs Rated New Buy at William O’Neil
    • Lucid (LCID) Rated New Hold at TD Cowen; PT $2.30
    • MARA Holdings (MARA) Rated New Buy at Rosenblatt Securities Inc; PT $19
    • Nexxen International Ltd (NEXN) Reinstated Buy at Needham; PT $12
    • Norfolk Southern (NSC) Reinstated Buy at Deutsche Bank; PT $293
    • Old Dominion (ODFL) Rated New Buy at Deutsche Bank; PT $236
    • Rivian (RIVN) Rated New Hold at TD Cowen; PT $12.70
    • RXO (RXO) Rated New Hold at Deutsche Bank; PT $19
    • Saia (SAIA) Reinstated Buy at Deutsche Bank; PT $570
    • Sandisk (SNDK) Rated New Overweight at Cantor; PT $60
    • Sea Ltd (SE) ADRs Rated New Buy at Sealand Securities
    • Sprott (SII CN) Rated New Outperform at BMO; PT C$75
    • Stellantis (STLA) Rated New Hold at TD Cowen; PT $13
    • Surf Air Mobility (SRFM) Rated New Buy at HC Wainwright; PT $12
    • Under Armour (UAA) Rated New Neutral at KGI Securities; PT $7.40
    • Union Pacific (UNP) Rated New Buy at Deutsche Bank; PT $295
    • Up Fintech Holding (TIGR) ADRs Rated New Overweight at Guotai Junan Sec
    • UPS (UPS) Reinstated Hold at Deutsche Bank; PT $119
    • Vertiv Holdings (VRT) Rated New Outperform at RBC; PT $121
    • Werner Enterprises (WERN) Reinstated Hold at Deutsche Bank; PT $33
    • XPO Inc (XPO) Reinstated Buy at Deutsche Bank; PT $156

 

 

 

 

Data sources: Bloomberg, Reuters, CQG

 

 

David Wienke

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