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The Daily Briefing -Futures Continue To Trade In a Narrow Range This Week.

by Geoff Garbacz | 06/08/2023 10:03 AM

Rebel Yell Morning Market Report

Your Daily Financial Market Briefing - Giving You An Investing Edge Before Each Trading Day Begins

The Daily Briefing -Futures Continue To Trade In a Narrow Range This Week.

Overnight Summary: The S&P 500 closed Wednesday at 4267.52 lower by -0.38% from Tuesday at 4283.85 higher by 0.24%. The overnight high of 4295.50 was hit at 6:20 a.m. EDT. The low was hit at 4262.75 at 12:5 a.m. EDT, a range of ~13 points high to low which is the fourth low-vol night in a row.  At 7:20 a.m. EDT, the current price was 4273 which is -0.02% and -1.00 points. The 10-day average of the overnight range is at 18.70 from 20. The average for May was 21.63.

Earnings Out After The Close: 

  • Beats: GEF +0.45, SMTC +0.10, SMAR +0.10, HCP +0.07, OXM +0.04, VRNT +0.06, GME +0.01 of note
  • Flat: None of note.
  • Misses: CURV (0.02) of note.

Unusual Options Activity:

Daily Screen in Erlanger Chartroom that highlights unusual Call and Put Options activity in the S&P 500.  It looks for volume outliers relative to the Open interest in Calls or puts.  Usually, the stock price activity reflects the outlier situation (earnings/buyout/announcement), but once in a while, you can uncover stocks prior to a pop or drop.

Capital Raises:

  • IPOs Priced or News: None of note.
  • New SPACs launched/News:
    • Digital World Acquisition Corp (DWAC) Board has approved an extension of the date by which the Company would be required to consummate a Business Combination from June 8, 2023 to September 8, 2023.
  • Secondaries Priced:
    • AKYA: prices $43.5 Million offering. 8.7 Million shares at $5 per share.
      ATAT: Announces Pricing of Upsized Registered Secondary Offering of American Depositary Shares by Legend Capital.
    • AIG: Announces Pricing of Secondary Offering of Corebridge Financial, Inc. Common Stock at $16.25 per share.
    • BLBD: Prices 4.5 Million secondary stock offering at $20.00.
    • GEHC: Prices 25 Million secondary stock offering at $78.00.
    • MBLY: Prices secondary offering of 38.5 Million shares at $42.
    • SKWD: Announced the pricing of its underwritten offering of 3,850,000 of its common stock by The Westaim Corporation at the price of $23.00 per share.
    • STER: Announces Pricing of Secondary Public Offering.
  • Notes Priced of note:
    • BN: Announces Pricing of $550 Million Notes Offering.
    • CSWC: Prices Public Offering of $62.5 million 7.75% Notes due 2028.
    • RHP: Announces Upsizing and Pricing of $400 Million of Senior Notes Due 2028.
  • Common Stock filings/Notes:
    • AKYA: Public Offering of Common Stock. (MS and Piper bookmanagers)
    • CNM: Announces Secondary Offering AND Share Repurchase.
    • FRZA: Filed Form S-1.. 3,425,000 Shares Common Stock.
    • HSCS: Filed Form S-1.. Up to 8,000,000 Shares of Common Stock.
    • SVRE: Filed Form F-1.. Up to 5,000,000 American Depositary Shares Representing 25,000,000 Ordinary Shares.
    • TNON: Filed Form S-1.. Up to 16,465,422 Units, Each Unit Consisting of One Share of Common Stock and Two Warrants, Each to Purchase One Share of Common Stock.
  • Direct Offering: None of note.
  • Selling Shareholders of note: None of note.
  • Private Placement of Public Entity (PIPE): None of note.
  • Mixed Shelf Offerings:
    • NGM: Filed Form S-3.. $300 Million Mixed Shelf.
    • FTV: Filed Form S-3ASR.. Mixed Shelf Offering.
  • Debt/Credit Filing and Notes:
    • MMSI: Announces New Five-Year Senior Secured Credit Agreement.
    • SRG: Makes $50 Million Loan Prepayment.
    • VYBE: Limitless X CEO Provides Company with $1 Million Funding Commitment.
  • Tender Offer:
    • DBI: Announces Intent to Repurchase Up to $100 Million of its Class A Common Shares Through Modified Dutch Auction Tender Offer.
    • EQT: Announces Early Results and Upsizing of its Tender Offer for 6.125% Senior Notes due 2025.
  • Convertible Offering & Notes Filed:
    • BFH: Announces offer $275 million in aggregate principal amount of convertible senior notes due 2028
      IONS: Raises $500 Million Via Private Placement Of Convertible Senior Notes.
    • VTNR: Announces Key Step in Strengthening Balance Sheet Position with Private Exchange of Approximately $79.95 Million of 6.25% Convertible Notes Due 2027.
    • VTR: Announces Proposed Private Placement of $500 Million of Exchangeable Senior Notes.

Capital Raise Summary From The TradeXchange, bringing traders and investors real time news and Squawk Box, and other sources.

News After The Close:

  • After Hours: 
    • Trading Up: FDMT +20%, SMTC +14%,  EXPI +6%, PRVA +6%, GEF +5% of note.
    • Trading Down: HCP -22%, GME -19%, CURV -18%, SMAR -16%, OXM -10%, AKYA -8% of note.
  • News After The Close:
    • GameStop (GME) fires CEO, names Ryan Cohen executive chairman. (MarketWatch)
    • “For the most part, this year’s laggards were today’s winners, with Energy taking leadership baton and growth trio of Tech, Comm Serv, & Cons Discr drifting lower … small caps had another nice showing with huge gain relative to NASDAQ (but lots of catch-up to do YTD)” – Liz Ann Sonders – Charles Schwab
    • Binance.US Was Deeply Unprofitable in 2022, Documents Show. (WSJ)
    • Semtech (SMTC) stock rallies more than 10% after surprise profit. (MarketWatch)
    • Smartsheet (SMAR) stock falls nearly 20% following billings miss, free-cash-flow forecast. (MarketWatch)
    • Primoris Services Corporation (PRIM) Receives Projects Valued Over $650 Million.
  • Exchange/Listing/Company Reorg and Personnel News:
    • Index Changes: eXp World Holdings (EXPI) and Privia Health Group (PRVA) set to join S&P SmallCap 600
    • dLocal (DLO) Announces Appointment of Sergio Fogel as Co-President and Chief Strategy Officer.
    • First Citizens BancShares (FCNCA): Marc Cadieux Appointed President of Silicon Valley Bank Commercial.
    • Genius Group (GNS) Regains Compliance with NYSE American.
    • Kaiser Aluminum Corporation (KALU) Announces New Chief Accounting Officer.
    • Moxian (MOXC) Receives NASDAQ Notification Regarding Minimum Bid Requirements.
    • Perrigo (PRGO) Appoints Patrick Lockwood-Taylor as President and CEO.
    • Renren (RENN) Announces Proposed Name Change to Moatable, Inc.
    • STSA halted Additional Information Requested by NASDAQ.
    • Tupperware Brands (TUP) Announces Receipt of Notice of Non-Compliance with NYSE Continued Listing Requirements.
    • CRH who is the largest building materials supplier in the U.S. but based in Dublin, Ireland will move its listing from London to NYSE. (Reuters)
  • Buyback Announcements or News:
    • Affirm (AFRM) authorized the repurchase of up to $800 million in aggregate principal amount of its outstanding 0% Convertible Senior Notes due 2026.
    • CNM: (see Capital Raises)
    • Helmerich & Payne (HP) expands buyback program to 7 million shares from 5 million.
    • Hooker Furnishings (HOFT) Approved An Additional $5M Share Repurchase Authorization.
    • Cactus (WHD) Announces $150 Million Stock Repurchase Program.
    • Rev Group, Inc. (REVG) Announces a New $175 Million Share Repurchase Authorization.
  • Stock Splits or News:
    • BOIL UVXY ProShares Announces ETF Share Splits.
    • Flora Growth Corp. (FLGC) to Effect Reverse Stock Split.
    • Steel Connect, Inc. (STCN) Announces Reverse/Forward Stock Split.
  • Dividends Announcements or News:
    • FDX Goes ex div tomorrow for $1.26.
    • WMB Goes ex div tomorrow for $0.4475.
    • Universal Health (UHT) increases quarterly cash dividend to $0.72 per share from $0.715 per share.
    • VFC Goes ex div tomorrow for $0.30.

What’s Happening This Morning: Futures value reflects the change with fair value.

S&P 500 +1, Dow Jones -6,  NASDAQ -2, and Russell 2000 +5. (as of 7:56 a.m. EDT).  Asia lower while Europe is higher ex the FTSE. VIX Futures are at 15.55 from 15.50 yesterday.  Gold lower with Silver and Copper higher from yesterday. WTI Crude Oil and Brent Crude Oil higher with Natural Gas flat. US 10-year Treasury sees yields at 3.807% from 3.689% yesterday. The U.S. Dollar is lower versus the Euro, lower versus the Pound and lower against the Yen. Bitcoin is at $26,449 from $26,738 yesterday, lower by -0.16%.

Sector Action – (1/3/6/12/YTD Updated Weekly with Monday release):  

  • Daily Positive Sectors: Energy, Real Estate, Industrials, Utilities of note.
  • Daily Negative Sectors: Communication Services, Technology of note.
  • One Month Winners: Technology, Communication Services, Consumer Cyclical of note.
  • Three Month Winners: Communication Services, Technology, Consumer Cyclical, of note.
  • Six Month Winners: Technology, Communication Services, Consumer Cyclical of note.
  • Twelve Month Winners: Technology, Industrials, Communication Services of note.
  • Year to Date Winners:  Technology, Communication Services, Consumer Cyclical of note.

Stocks fell Wednesday after a surprise rate hike from the Bank of Canada took the air out of a Tuesday rally.   Major stock indexes came under pressure as the trading day wore on, a day after the S&P 500 and Nasdaq Composite set fresh highs for the year. The benchmark S&P 500 shed 0.4%. The tech-heavy Nasdaq lost 1.3%, while the Dow Jones Industrial Average gained 0.3%.   The S&P 500 briefly touched bull-market territory Wednesday morning, but it didn’t last. Stock declines were sparked by the Bank of Canada’s unexpected decision to raise interest rates to a 22-year high after a four-month pause in tightening. The central bank cited a strong labor market and consumer spending as risks to inflation’s path to its 2% target.  (WSJ – edited by QPI)

Upcoming Earnings Of Note: (From Chartroom Software – sorted by market cap, highest to lowest with most visible names)

  • Thursday After the Close: 

  • Friday Before the Open: None of note.

Earnings of Note This Morning:

  • Beats: SIG +0.29, REVG +0.15 of note.
  • Flat: None of note.
  • Misses: DBI (0.02), FCEL (0.01) of note.
  • Still to Report: TTC of note.

Guidance:

  • Positive Guidance: SMAR, REVG of note.
  • Negative Guidance: CURV, OXM, VLN, DBI, SIG of note.

Erlanger Research Advance/Decline Chart:

Gap Ups & Down In Early Pre-Market:

  • Gap Up: SMTC +24%, FDMT +15%, EXPI +9%, PRVA +6%, RCEL +5%, IPHA +5%, UHT +5%, STER +5%, TCOM +4%, GEF +4% of note.
  • Gap Down: HCP -20%, GME -18%, SMAR -18%, CURV -7%, OXM -5%, VTNR -4% of note.

Insider Action: DG sees Insider buying with dumb short selling.  INVA sees Insider buying with smart short sellers.

  

Rags & Mags: Repeated stories from prior days never listed, i.e. “rehashed news”. Sorted by Global, U.S. and stock specific.

  • 5 Things You Need to Know to Start Your Day. (Bloomberg) 
  • 5 Things to Know Before The Market Opens. (CNBC)
  • Bloomberg Lead Story: New York City Could Be In For a Smokey Summer as Wildfires Rage. (Bloomberg)
  • Bloomberg  Most Shared Story:  Flights to LaGuardia Grounded as Smoke Blankets NYC. (Bloomberg)
  • Chinese banks cut deposit rates, signaling monetary easing ahead. (CNBC)
  • Chinese to build a listening base in Cuba with payment in the billions to the country. (WSJ)
  • Eurozone slipped into recession earlier this year and growth expected to remain tepid. (NYT)
  • GOP warns of pushback ahead of looming Trump indictment. (The Hill)
  • President Biden vetos measure overturning student loan forgiveness. (The Hill)
  • Bonds everywhere suffer as rate hike fears swamp traders. (Bloomberg)
  • Ship buildup at West Coast ports as supply chain breaks again. (CNBC)

Moving Average Update:

  • Score inches back from 100% to 91% as the short term moving averages play catch up.

Geopolitical: 

  • President’s Public Schedule:
    • The President holds a bilateral meeting with Prime Minister Rishi Sunak of the United Kingdom, 11:30 a.m. EDT
    • The President holds a joint press conference with Prime Minister Rishi Sunak of the United Kingdom, 1:30 p.m. EDT
    • The President hosts a Pride Celebration with Betty Who, 7:00 p.m. EDT

Economic:

  • Initial Jobless Claims 8:30 a.m. EDT
  • Wholesale Inventories 10:00 a.m. EDT
  • EIA Natural Gas Report 10:30 a.m. EDT

Federal Reserve / Treasury Speakers:  Fed Blackout Period.

M&A Activity: 

  • Avanos Medical, Inc. (AVNS) Announces Sale of Respiratory Health Business to SunMed Group Holdings, LLC.

Meeting & Conferences of Note:

  • Sellside Conferences:
    • JP Morgan European Capital Goods CEO Conference 2023 (06/08/23-06/09/23)
    • Jefferies IT Services Summit
    • Gabelli and Company 14th Annual Entertainment & Broadcasting Conference 2023
    • Mizuho Midcap Utilities Conference (06/08/23-06/09/23)
    • Piper Macro Outlook Seminar
    • RBC Consumer Day
    • RBC Mining & Metals Conference
    • RBC Global Energy, Power & Infrastructure Conf

Top Tier Sell-side Upgrades & Downgrades:

The recommendations listed below in this “Upgrade/Downgrade” section are compiled from what we believe are Tier I, II and III firms. Recommendations posted are taken from a variety of sources each day and we only post upgrades or significant initiations as well as downgrades to underweight or sell. The purpose of this posting it to make the reader aware of market moving recommendations. None of these recommendations should be interpreted as actual recommendations from CAPIS or its employees.

Today’s Upgrades and Downgrades:

Previous Day’s Upgrades and Downgrades:

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