Daily Game Plan

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

TODAY’S ECONOMIC DATA:   8:15ET ADP Employment Change; 8:30ET GDP, Personal Consumption, Core PCE Price Index QoQ,
Employment Cost Index; 9:45ET MNI Chicago PMI; 10:00ET Personal Income, Personal Spending, PCE Price Index, Pending Home Sales

Highlights and News:  

• US 1Q CORE PCE RISES ANNUALIZED 3.5% Q/Q; EST. +3.1%. 
  
• China: Reiterates It’s Not Engaged in Any Tariff Negotiations With the US
• Ukraine Ready to Sign US Resources Deal as Early as Today
• Beijing Created a List of US-Made Products That Would be Exempted from Tariffs
• China has yet to release its weekly trade data, usually published on Mondays
  

Global stocks struggled for direction as investors awaited a raft of important economic data that could underscore this week’s corporate warnings about the impact
of President Trump’s tariffs. China’s factory activity has slipped into contraction, with the official manufacturing purchasing managers’ index falling to 49 from 50.5 in March. The data was worse than expected with new export orders falling to the lowest
since December 2022. Elsewhere, the euro-area economy grew 0.4% in the first quarter, exceeding expectations and marking the fifth consecutive quarter of growth. UK house prices dropped 0.6% in April, the biggest decline in almost two years after a tax break
for buyers expired and consumer confidence fell due to US tariffs. The Bank of Japan is expected to hold policy settings steady for a second straight meeting on Thursday in the face of intensified uncertainties due to US tariff measures. Japan’s factory output
fell 1.1% in March compared with the previous month, signaling weakening momentum for manufacturers.

EQUITIES: 

US equity futures slipped amid jitters over tech earnings and as further companies withdrew their guidance due to uncertainty. Futures were slightly lower after weak earnings as Super
Micro Computer and Snap fell sharply in post-market ahead of Microsoft and Meta numbers later today. Early focus this morning will be on advance first quarter GDP data, which is expected to show the economy stalled or even contracted in the first quarter.
PCE inflation, the Fed’s preferred gauge of price pressures, is also due. Index futures extended their decline after the figures were released.
US 1Q CORE PCE RISES ANNUALIZED 3.5% Q/Q; EST. +3.1%.  Ukraine is set to sign a natural resources deal with the US as soon as today.  

Futures ahead of the bell: E-Mini S&P -0.9%, Nasdaq -1.1%, Russell 2000 -1%, DJI -0.4%. 

In pre-market trading, BridgeBio Pharma (BBIO) rallies 9% after the drugmaker reported sales of its recently approved heart drug, Attruby, that crushed expectations.
Etsy (ETSY) rises 1% after the online marketplace for crafts reported revenue for the first quarter that beat. First Solar (FSLR) tumbles 12% after the maker of electricity-producing solar modules cut earnings guidance for this year due to tariffs. Freshworks
Inc. (FRSH) climbs 9% after the software-as-a-service company boosted its profit and revenue outlook for the year. Garmin (GRMN) falls 6% after the maker of GPS-enabled products posted first-quarter results and provided a year forecast. Norwegian Cruise Line
(NCLH) drops 7% after warning that cruise demand is beginning to weaken. Oddity Tech (ODD) jumps 17% after the direct-to-consumer beauty and wellness company boosted its net revenue guidance for the full year. Qorvo (QRVO) climbs 8% after the Apple supplier
reported adjusted 4Q earnings that topped estimates. Regulus Therapeutics (RGLS) shares are halted after the company entered into an agreement to be acquired by Novartis AG. Seagate (STX) gains 7% after the computer hardware and storage company reported third-quarter
earnings and revenue that beat. Snap (SNAP) sinks 13% after the company declined to issue a sales forecast for the current period, saying it is navigating macroeconomic “headwinds” for its advertising business. Starbucks (SBUX) falls 8% after weaker-than-expected
results in the latest quarter. Super Micro Computer (SMCI) tumbles 16% after giving preliminary results that fell well short of analysts’ estimates. Wabash National (WNC) falls 13% after the semi-trailer manufacturing company cut its revenue guidance for the
full year.

European gauges are higher as investors assessed a flurry of earnings across sectors. The Stoxx 600 is higher for a seventh consecutive session, while disappointing
earnings keep a lid on gains. Media is the best performing sector, lifted by Universal Music Group’s subscription growth, which helped deliver first-quarter results above expectations. Miners are the worst performers, with Glencore losing 8% after it reported
disappointing copper production and sees commodity marketing profits to fall again this year. Energy and bank stocks also underperform with notable declines in TotalEnergies and Credit Agricole after their updates. Volkswagen’s earnings plunged 40% on higher
costs as tariffs cloud the future. Both Mercedes and Stellantis suspended their profit guidance due to the uncertain impact of the tariffs. Stoxx 600 +0.35%, DAX +0.6%, CAC +0.6%, FTSE 100 +0.1%. Media +1.8%, Healthcare +1.7%, Telecom +1.5%. Basic Resources
-3.4%, Banks -2.5%, Travel -2.5%, Energy -0.8%.

Shares in Asia rose as investors were encouraged by potential trade deals with the US. Trump signed an executive order on Tuesday, easing the impact of his auto tariffs,
while news emerged of discussions with South Korea and Australia. The MSCI Asia Pacific Index gained 0.6%, with Sony among the biggest boosts after a report it is considering spinning off its semiconductor unit. South Korean stocks slipped after US export
controls dent Samsung chip business. Hang Seng rose and most mainland shares were broadly steady even as Chinese manufacturing shrinks the most since 2023. Shares of Chinese banks were among the biggest drags on equity benchmarks in the mainland after weak
earnings. Today is the last trading day in China before a five-day Labour Day holiday.
Thailand outperformed after cutting its key interest rate to 1.75%, the lowest level in two years. Thailand +2.2%, Philippines +1.6%, Hang Seng Tech +1.3%, Singapore
+0.7%, ASX 200 +0.7%, Topix +0.6%, Hang Seng Index +0.5%, Indonesia +0.25%, Taiwan was flat. Sensex -0.05%, CSI 300 -.01%, Kospi -0.3%.

FIXED INCOME: 
 

US Treasury prices traded in a tight range overnight as Japan’s Golden Week holiday is taking place. The long end of the curve outperforms, and the curve is flatter
by 1.5bps. 10-year yield down 3bps around 4.15% ahead of some key economic data including Core PCE.
Yields spike after the data.

METALS: 

Gold slips as market turmoil eases and likely profit taking as exchange-traded funds are reporting gold outflows.  Reducing trade tensions between the US and China,
alongside rising hopes of a Russia-Ukraine peace deal, are reducing safe-haven demand for gold. Copper prices fell sharply as traders rushed in to square off their positions before a long holiday in China. Pressure intensified as top copper consumer China
saw a key manufacturing indicator come in significantly weaker than economists expected. Oversupply of the metal, mainly used in power infrastructure for its conductivity, is expected to grow globally this year, an industry group said on Tuesday. Spot gold
-0.8%, Silver -1.9%, Copper -5.2%.

ENERGY:   

Oil prices extended declines, poised for their largest monthly drop in almost three and a half years, driven by a global trade war dampening fuel demand forecasts
and concerns over rising supply. Brent and WTI have lost around 15% and 16% respectively, the biggest percentage drops since November 2021. Sending bearish signals on the supply side, US crude oil inventories rose by 3.8 million barrels last week, according
to API data. That would take holdings to the highest since June if confirmed by the EIA today.  WTI -0.7%, Brent -0.6%, US Nat Gas -1.2%, RBOB -0.4%. 

CURRENCIES: 

Moves were fairly muted in currency markets with the yen leading losses in the Group-of-10 currencies. US$ Index is slightly higher ahead of a raft of economic data
including Core PCE. The Aussie dollar firmed against the greenback after core inflation came in hotter than expected in Q1, damping expectations of a rapid series of interest-rate cuts this year just days before a closely-fought election. The yuan turns marginally
firmer ahead of Asia’s long holiday weekend.  US$ Index +0.15%, GBPUSD -0.4%, EURUSD -0.1%, USDJPY +0.45%, AUDUSD +0.15%, NZDUSD -0.2%, USDCHF +0.2%, USDCAD -0.05%, USDSEK +0.15%, USDNOK +0.05%, USDMXN -0.2%.

Bitcoin +0.3%, Ethereum +0.1%.  

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
• Airbnb (ABNB) Raised to Buy at DA Davidson; PT $155
• Canada Goose (GOOS CN) Raised to Equal-Weight at Wells Fargo; PT C$11
• CECO Environmental (CECO) Raised to Buy at HC Wainwright; PT $33
• DiamondRock Hospitality (DRH) Raised to Buy at BofA
• Ford (F) Raised to Peerperform at Wolfe
• Levi Strauss (LEVI) Raised to Overweight at Wells Fargo; PT $20
• NetApp Inc (NTAP) Raised to Overweight at Barclays; PT $115
• Orrstown (ORRF) Raised to Outperform at Hovde Group; PT $35
• Qorvo (QRVO) Raised to Buy at Benchmark; PT $95
• Repligen (RGEN) Raised to Outperform at Wolfe; PT $160
• Sherwin-Williams (SHW) Raised to Overweight at Wells Fargo; PT $420
• Shift4 Payments (FOUR) Raised to Buy at Benchmark; PT $111
• Summit Hotel (INN) Raised to Neutral at BofA
• Sunstone Hotel (SHO) Raised to Buy at BofA
• T-Mobile (TMUS) Raised to Sector Outperform at Scotiabank; PT $277.50
• VF Corp (VFC) Raised to Equal-Weight at Wells Fargo; PT $12
• Warby Parker (WRBY) Raised to Neutral at Citi; PT $17
• Downgrades
• Carter’s (CRI) Cut to Underweight at Wells Fargo; PT $25
• Central Garden & Pet (CENT) Cut to Hold at Truist Secs; PT $35
• Cheniere Energy (LNG) Cut to Peerperform at Wolfe
• First Solar (FSLR) Cut to Underweight at KeyBanc; PT $100
• Freshpet (FRPT) Cut to Hold at Truist Secs; PT $80
• Gap (GAP) Cut to Equal-Weight at Wells Fargo; PT $24
• HarborOne (HONE) Cut to Neutral at Janney Montgomery; PT $12
• Horizon Technology (HRZN) Cut to Sell at Compass Point; PT $6.50
• NeoGenomics (NEO) Cut to Market Perform at Leerink; PT $9
• Nike (NKE) Cut to Equal-Weight at Wells Fargo; PT $55
• Paccar (PCAR) Cut to Neutral at JPMorgan; PT $90
• Park Hotels (PK) Cut to Underperform at BofA; PT $11
• Quanterix (QTRX) Cut to Market Perform at Leerink; PT $8
• SpringWorks (SWTX) Cut to Neutral at HC Wainwright; PT $47
• Starbucks (SBUX) Cut to Neutral at Goldman; PT $85
• Victoria’s Secret (VSCO) Cut to Underweight at Wells Fargo; PT $12
• Werner Enterprises (WERN) Cut to Underperform at Evercore ISI; PT $21
• Initiations
• Akero Therapeutics (AKRO) Rated New Buy at Clear Street; PT $49
• Aya Gold & Silver Inc (AYA CN) Rated New Sector Outperform at Scotiabank
• Edgewise Therapeutics (EWTX) Rated New Buy at Guggenheim; PT $41
• First Nordic Metals Corp (FNM CN) Rated New Buy at Roth Capital Partners
• HealWELL AI (AIDX CN) Rated New Sector Outperform at Scotiabank; PT C$2.50
• JD.com (JD) ADRs Reinstated Outperform at Haitong Intl; PT $60
• McEwen Mining (MUX) Rated New Outperform at National Bank; PT $14.44
• OneStream (OS) Rated New Outperform at Mizuho Securities; PT $30
• OnKure Therapeutics Inc (OKUR) Rated New Outperform at Evercore ISI
• Prairie Operating (PROP) Rated New Overweight at Piper Sandler; PT $11
• Salesforce Inc (CRM) Rated New Buy at WestPark Capital; PT $320
• Tesla (TSLA) Rated New Buy at Founder Securities

Data sources: Bloomberg, Reuters, CQG

David Wienke