Daily Game Plan

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

DATA/HEADLINES   8:30ET  Weekly Jobless Claims; 9:30ET Fed’s Bostic and Barkin speak; 11:00ET Fed’s Barkin speaks;
12:00ET Fed’s Paese speaks; 12:30ET ECB’s Lagarde speaks; 1:00ET 30-year bond auction; 2:00ET Fed’s Powell speaks at IMF conference

TODAY’S HIGHLIGHTS:  

• China warns the UK about embracing ties with Taiwan
• Deflationary pressures persist in China’s economy
• US military fired on a weapons depot in Syria used by Iran’s Revolutionary Guard
  

Global shares edged higher as bets that major central banks are now done with rate hikes and the recent slide in oil prices kept global borrowing costs near their
lowest levels in months. China’s consumer prices swung lower in October, as key gauges of domestic demand pointed to weakness not seen since the pandemic. Chinese factory deflation persisted for the 13th straight month. Investor attention now turns to Federal
Reserve Chair Jerome Powell’s appearance on a panel discussing monetary-policy challenges.                                   

EQUITIES: 
   

US equity futures were muted after the S&P 500 notched an eighth straight day of gains.  Another move higher today would mark the longest winning run since 2004.
Fed Chair Jerome Powell is scheduled to speak at an International Monetary Fund conference at 2 p.m. ET.                 

Futures ahead of the bell: E-Mini S&P +0.2%, Nasdaq +0.05%, Russell 2000 +0.65%, Dow +0.2%.

In pre-market trading, Walt Disney (DIS) gained 4% after profit beat estimates on higher attendance at its Shanghai and Hong Kong theme parks.  Arm Holdings (ARM) sank 6% as its first
earnings report since its initial public offering gave a disappointing sales forecast.  Theatre chain AMC Entertainment (AMC) rose 2.3% on beating third-quarter revenue estimates. Affirm Holdings (AFRM) rallies 13% after the buy-now-pay-later company posted
fiscal first-quarter revenue that beat estimates. Amylyx Pharmaceuticals (AMLX) falls 15% after the firm reported revenue and profit for the third quarter that missed. AppLovin (APP) gains 15% after the mobile app technology company reported Q3 revenue that
topped estimates. Bill Holdings (BILL) falls 11% after Bloomberg News reported that the company is in advanced talks to acquire Melio Payments. Bloom Energy (BE) rises 18% after the hydrogen fuel cell company reported better-than-expected adjusted earnings.
Cardlytics (CDLX) sinks 37% after the digital advertising company gave a fourth-quarter outlook that fell short of consensus. Duolingo (DUOL) rises 9% after the company’s number of daily active users for the third quarter exceeded expectations. Twilio (TWLO)
rises 5% after the software company reported third-quarter results that beat expectations. Virgin Galactic (SPCE) climbs 9% after the space travel company boosted its revenue forecast for the fourth quarter.

European indices grind higher with the Stoxx 600 adding 0.7% on the back of a 35% surge in shares of Adyen NV, a Dutch payments processor that competes with PayPal. The company unveiled
growth targets and a pathway to achieving them. Earnings remain a key driver of sentiment in equity markets. Among the big names to report before the bell were AstraZeneca, Deutsche Telekom, Henkel, ArcelorMittal and Wienerberger. Stoxx 600 +0.7, DAX +0.5%,
CAC +0.8%, FTSE 100 +0.5%. Chemicals +2.3%, Industrials +2%, REITs +1.5%. Travel & Leisure -1.7%.                          

Shares in Asia were mostly better with the MSCI Asia Pacific Index rising 0.4%.  Japanese stocks led gains, with Toyota, Nintendo and Mitsubishi Corp. among the biggest boosts. Philippine
stocks also gained, as the economy grew faster than expected in Q3 thanks to a boost from state spending.  Shares in China were muted, with mainland benchmarks closing little changed after the latest price data showed that the country slipped into deflation.
Chinese inflation data showed that October CPI fell 0.2% year on year, while PPI data fell 2.6% year on year, stoking deflationary fears.  Both indicators were last negative at the same time in November 2020 during the COVID-19 pandemic. Nikkei 225 +1.5%,
Philippines +0.5%, Indonesia +0.5%, ASX 200 +0.3%, Kospi +0.2%, China’s CSI 300 +0.05%. Vietnam and Taiwan were flat. Sensex -0.2%, Hang Seng Index -0.3%.

FIXED INCOME: 
 

Treasuries fell with the long-end leading losses ahead of more speeches by central bank officials. US yields are cheaper by as much as 8bp across long-end with 5s30s
spread steeper by 1.5bp on the day. The new 10-year note auctioned Wednesday yields around 4.55%. Treasury auction cycle concludes with $24b 30-year bonds, following decent receptions for 3- and 10-year note sales. 

METALS: 
   

Gold steadied near the lowest in more than three weeks as investors awaited further insight on the outlook for interest rates, with Jerome Powell due to speak at
the IMF’s annual research conference. The precious metal is down more than 2% so far this week after declining in the previous three sessions as its war-risk premium continues to fade, with the conflict between Israel and Hamas remaining relatively contained.
Spot gold -0.1%, silver -0.1%.  

ENERGY:  

Oil is slightly higher after plunging almost 7% over the previous two sessions on worries about global consumption despite reassurances from Saudi Arabia and OPEC+
about healthy consumption. Prices edged up overnight as markets shrugged off deflationary indicators in China.  On the sidelines of an industry event in London this week, many traders said they were having to discount cargoes due to weaker demand from refineries.
WTI +1%, Brent +1%, US Nat Gas +0.6%, RBOB +0.8%. 

CURRENCIES:   

The US dollar is slightly higher and on a four-day winning streak, for the first time since September, amid tight ranges as traders wait for speeches from Federal
Reserve Chair Jerome Powell and European Central Bank President Christine Lagarde. Following last week’s elevated volumes, interest in the spot and options markets is significantly lower this week. US$ Index +0.1%, GBPUSD -0.2%, USDJPY +0.1%, EURUSD -0.15%,
AUDUSD -0.02%, NZDUSD +0.25%.  

Bitcoin +3.7%, Ethereum +1.4%. cryptocurrency-linked stocks rise as Bitcoin extends gains for a fourth consecutive session to touch its highest level since May 2022.
The recent rally is led by expectations of an approval for exchange traded funds to invest in the largest crypto token.  

TECHNICAL LEVELS: 

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
• AG Growth International (AFN CN) Raised to Outperform at Raymond James
• Dentalcorp (DNTL CN) Raised to Reduce at Veritas Investment Research Co
• Essex Property (ESS) Raised to Market Perform at BMO; PT $225
• Global Net Lease (GNL) Raised to Buy at Colliers; PT $12
• Kellanova (K) Raised to Equal-Weight at Barclays; PT $55
• Kornit Digital (KRNT) Raised to Buy at Craig-Hallum; PT $23
• Medexus Pharmaceuticals (MDP CN) Raised to Buy at Canaccord; PT C$3.75
• Montrose Environmental (MEG) Raised to Overweight at JPMorgan; PT $41
• Nektar (NKTR) Raised to Outperform at Cowen
• NFI Group (NFI CN) Raised to Outperform at ATB Capital; PT C$17
• Parex Resources (PXT CN) Raised to Outperform at RBC; PT C$33
• Parker-Hannifin (PH) Raised to Buy at Deutsche Bank; PT $506
• Spirit Aero (SPR) Raised to Outperform at Wolfe; PT $34
• Triumph Group (TGI) Raised to Outperform at Cowen; PT $14
• Village Farms International (VFF) Raised to Buy at Craig-Hallum; PT $1
• Wish (WISH) Raised to Neutral at Citi; PT $5.50
• Downgrades
• ADC Therapeutics (ADCT) Cut to Market Perform at Cowen
• Atara Bio (ATRA) Cut to Inline at Evercore ISI
• Cut to Neutral at HC Wainwright
• Bark (BARK) Cut to Hold at Canaccord; PT $1.50
• Durect (DRRX) Cut to Hold at JonesTrading
• Ginkgo Bioworks (DNA) Cut to Neutral at BTIG
• James River Group (JRVR) Cut to Underweight at Barclays; PT $12
• Cut to Market Perform at KBW; PT $14
• Cut to Hold at Truist Secs; PT $15
• Lulu’s Fashion (LVLU) Cut to Neutral at BTIG
• Masonite (DOOR) Cut to Equal-Weight at Stephens; PT $93
• Navient (NAVI) Cut to Hold at Jefferies; PT $16
• PureCycle (PCT) Cut to Market Perform at Oppenheimer
• Rubicon Technologies (RBT) Cut to Hold at Canaccord; PT $2.50
• Sangoma Technologies (STC CN) Cut to Hold at Canaccord; PT C$4.48
• Tigo Energy (TYGO) Cut to Neutral at Roth MKM; PT $2.50
• Topgolf Callaway Brands (MODG) Cut to Equal-Weight at Stephens; PT $13
• Veritone (VERI) Cut to Sell at Craig-Hallum; PT 50 cents
• WideOpenWest (WOW) Cut to Sector Weight at KeyBanc
• Initiations
• AbbVie (ABBV) Reinstated Hold at Deutsche Bank; PT $150
• Amgen (AMGN) Reinstated Hold at Deutsche Bank; PT $240
• Amkor Technology (AMKR) Rated New Equal-Weight at Morgan Stanley
• Apellis Pharma (APLS) Rated New Buy at Goldman; PT $74
• Autolus Therapeutics (AUTL) ADRs Rated New Buy at Deutsche Bank; PT $10
• Bristol Myers (BMY) Reinstated Hold at Deutsche Bank; PT $55
• CSG Systems (CSGS) Rated New Equal-Weight at Wells Fargo; PT $49
• Cytokinetics (CYTK) Reinstated Buy at Goldman; PT $50
• Eli Lilly (LLY) Reinstated Hold at Deutsche Bank; PT $535
• IBM (IBM) Rated New Neutral at President Capital Management; PT $160
• ImmunoGen (IMGN) Rated New Buy at Deutsche Bank; PT $25
• Ironwood (IRWD) Reinstated Buy at Jefferies; PT $21
• Merck & Co (MRK) Reinstated Buy at Deutsche Bank; PT $115
• Phillips 66 (PSX) Rated New Hold at DBS Bank; PT $122
• Portland General (POR) Reinstated Buy at Ladenburg Thalmann; PT $43
• Regeneron (REGN) Reinstated Hold at Deutsche Bank; PT $800
• Sutro Biopharma (STRO) Rated New Buy at Deutsche Bank; PT $12
• Tesla (TSLA) Rated New Reduce at HSBC; PT $146

Data sources: Bloomberg, Reuters, CQG