The Daily Briefing For April 3rd: Second Quarter Begins Today In A Shortened Trading Week

Overnight Summary: The S&P 500 closed Friday higher by 1.44% at 4109.31 from Thursday higher by 0.57% at 4050.83. The overnight high of 4137 was hit at 4:00 a.m. EDT. The low was hit at 4122.75 at 8:10 a.m. EDT, a range of 15 points high to low which is below the recent range of 45. At 7:25 a.m. EDT the current price was 4134.25 which is -0.08% and -3.25 points. Markets will be closed on Friday.

Earnings Out After The Close: 

• Beats: None of note.
• Flat: None of note.
• Misses: None 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:
  • Hongli Group Inc. (HLP) Announces Closing of US$8.25 Million Initial Public Offering.
• New SPACs launched/News:
  • Deep Medicine Acquisition Corp. (DMAQ) and TruGolf announce the execution of a definitive merger agreement.
  • Hudson Acquisition I Corp. (HUDA) Announces Letter of Intent for Business Combination.
  • Sagaliam Acquisition Corp. (SAGA) Confirms Funding And Extension Of Deadline To Complete Business Combination.
• Secondaries Priced:
  • OCX: Pricing of $13.86 Million Public Offering of Common Stock.
• Notes Priced of note: None of note.
• Common Stock filings/Notes:
  • AMRS: Filed Form S-3.. 810,596 Shares of Common Stock.
  • BURU: Filed Form S-1.. 15,600,000 Shares of Common Stock.
  • BKSY: Filed Form S-3.. 32,807,354 Shares of Class A Common Stock.
  • KOD: Filed Form S-3.. 17,310,490 Shares.
  • NKLA: Announces Proposed Public Offering of up to 89.3 Million Common Shares – SEC Filing.
  • SLND: Filed Form S-1.. 53,669,877 Shares of Common Stock, 585,502 Private Warrants, 14,385,502 Shares of Common Stock Issuable Upon Exercise of Warrants.
• Direct Offering:
  • SPCB: Closing of $2.4 Million Registered Direct Offering.
• Selling Shareholders of note:
  • BIVI: Filed Form S-3.. Up to 85,175 Shares of Common Stock Offered by the Selling Stockholders.
  • GTLB: Filed Form S-3ASR.. 1,635,545 Shares Class A Common Stock by Selling Shareholders.
• Private Placement of Public Entity (PIPE): None of note.
• Mixed Shelf Offerings:
  • ATO: Filed Form S-3ASR. $5 Billion Mixed Shelf.
  • CE: Filed Form S-3ASR — Mixed Shelf.
  • CVV: files $100 Million mixed-securities shelfCE: Filed Form S-3ASR — Mixed Shelf.
  • EVRI: Filed Form S-3ASR — Mixed Shelf.
  • LFVN: Filed Form S-3.. $75,000,000 Mixed Shelf.
  • MRNS: Filed Form S-3.. $375,000,000 Mixed Shelf.
  • SMFL: Filed Form S-3.. $150,000,000 Mixed Shelf.
  • SOPA: Marinus launches $375M mixed shelf offering – filing.
• Debt/Credit Filing and Notes:
  • CAPL: Enters into a New $925 Million Credit Facility.
  • JBI: Announces that it paid down $50 mln in debt using cash on hand.
  • MTDR: Company Announces Offering of $400 Million of Senior Notes Due 2028.
  • NE: Announces Proposed Offering Of $600 Million Of Senior Notes Due 2030.
• Tender Offer: None of note.
• Convertible Offering & Notes Filed:
  • DUK:  Announces proposed offering of $1.5 billion of convertible senior notes due 2026.
  • PTRA: Finalizes agreement with Cowen convertible note holders.
  • RNAZ: TransCode Therapeutics Announces Agreement with Triton Funds for Sale of Series A Convertible Preferred Stock.

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

News After The Close and Over the Week:

• Weekly Wrap Up: Best and Worst performing large cap stocks:
  • Trading Up: RUBY 49.7%, PBYI 38.9%, TBIO 33.6%, AXDX 31.4%, EBS 28.3%, BKD 22.6%, PVH 21.6%, LPSN 20.0%, CDE 19.6%, BB 19.5%, GTE 19.1%, BLKB 18.7%, SKYW 18.1%, BABA 18.0%, HA 17.9%, PACB 17.8%, FNKO 17.6%, OMI 17.6%, ARRY 17.5%.
  • Trading Down: UXIN -8.8%, LOCO -8.9%, AAOI -9.1%, RBBN -10.3%, ANGO -11.3%, CTMX -11.5%, EVLO -11.8%, AKBA -13.0%, BPT -14.8%, INO -14.9%, ASMB -20.1%, HRTX -20.7%, SMTC -23.4%, BLUE -28.8%, PRQR -36.8%, BBBY -43.6%, UBX -59.5%, SIVB -99.0%, SBNY -99.7%.

• News Items After the Close:
  • U.S. bank deposits declined $126 billion for the week ending March 22 from the previous week. Small banks saw net *inflows* of $6 billion, while large banks saw $90 billion in *outflows* But do note there have been big revisions to the previous week (Nick T Tweet WSJ)
  • US finalizes 1.12% cut to medicare advantage 2024 rates. (Bloomberg)
  • Google (GOOGL) Co-Founder, Other Billionaires Are Issued Subpoenas in Lawsuit Over JPMorgan’s (JPM) Ties to Jeffrey Epstein. (WSJ)
• News Items Over the Weekend:
  • Stocks that Defined the Week: DIS, FCNCB, BABA, CRM, LYFT, WAB, BBBY  (WSJ)
  • The Week in Business: A Bank Takeover (NYT)
  • In Surprise, OPEC+ Announces Cut in Oil Production. (NYTimes)
  • Japan Breaks With U.S. Allies, Buys Russian Oil at Prices Above Cap. (WSJ)
  • Tesla (TSLA) reports 422,875 deliveries for first quarter of 2023. (CNBC)
  • UBS plans to cut as many as 36,000 jobs globally from its combined bank with Credit Suisse, Swiss newspaper SoZ reported. (Bloomberg)
  • McDonald’s (MCD) Temporarily Shuts U.S. Offices As Chain Prepares For Layoff Notices. (WSJ)
  •  Barron’s:
    • Positive View: GOOG, META, SNAP of note.
    • Cautious View: , LYFT, VLY, PACW, OZK, PPBI, WAFD, INDB, TRMK, AX, SFBS, FUNC, SASR, PFS, DCOM, FFWM, OCFC of note.
    • Mixed View: None of note.
• Erlanger Type 1 Short Squeezes and Type 4 Long Squeezes reporting earnings this week:

• Exchange/Listing/Company Reorg and Personnel News:
  • Banner Corporation (BANR) Announces CFO Transition Plan.
  • Bicycle Therapeutics (BCYC) Enhances Leadership Team with Key Appointments.
  • First Capital, Inc. (FCAP) Announces Frederick Named Chief Executive Officer of First Harrison Bank; Stevens Named CFO.
  • HTZ Announces Departure of Chief Financial Officer.
  • IMV Receives Nasdaq Notification Regarding Minimum Bid Price Deficiency.
  • Lightbridge (LTBR) Strengthens Board of Directors with the Appointment of Sherri Goodman as a New Independent Director.
  • MARA CFO to step down.
  • Reed’s (REED) Announces Appointment of Interim Chief Financial Officer Joann Tinnelly.
  • Rubicon (RBT) Receives Notice of Non-Compliance with NYSE Trading Share Price Listing Rule.
  • Spruce Power (SPRU) Receives Notice Regarding NYSE Continued Listing Standard.
  • STNE: Completion of CEO Transition.
  • Swvl (SWVL) Received Nasdaq Notification Regarding Minimum Market Value Deficiency.
• Buyback Announcements or News: None of note.
• Stock Splits or News:
  • MINM   1-for-25 reverse stock split.
• Dividends Announcements or News:
  • CMCSA Goes ex div tomorrow for $0.29.

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

S&P 500 -3, Dow Jones +130,  NASDAQ -87, and Russell 2000 -1. (as of 7:58 a.m. EDT).  Asia higher ex South Korea (KOSPI)  and Europe higher ex Germany (DAX) VIX Futures are at 20.81 from 21 yesterday.  Gold higher with Silver and Copper lower. WTI Crude Oil and Brent higher with Natural Gas lower. US 10-year Treasury sees yields at 3.49% from 3.539% Friday. The U.S. Dollar is lower versus the Euro, lower versus the Pound and higher against the Yen. Bitcoin is at $28,288 from $27,860  yesterday, higher by 0.90%.

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

• Daily Positive Sectors: Consumer Cyclical, Real Estate, Communication Services, Technology of note.
• Daily Negative Sectors: None of note.
• One Month Winners: Technology, Communication Services, Utilities of note.
• Three Month Winners: Technology, Communication Services, Consumer Cyclical of note.
• Six Month Winners: Technology, Basic Materials, Industrial of note.
• Twelve Month Winners: Energy of note.
• Year to Date Winners: Technology, Communication Services, Consumer Cyclical of note.

U.S. stocks rallied on Friday to end a rocky month higher, while the Nasdaq Composite also posted its best quarterly gain since 2020. The Dow Jones Industrial Average  jumped about 414 points, or 1.3%, ending near 33,273 on Friday and up 1.9% for the month. The S&P 500 index  and Nasdaq Composite Index posted higher daily gains of 1.4% and 1.7%, respectively, which elevated their monthly gains to 3.5% and 6.7%. Investors in stocks largely looked past turbulence earlier in March after the Federal Reserve acted to calm markets following the sudden collapse of Silicon Valley Bank and Signature Banks. The Fed opened a new facility for banks to tap for liquidity with the aim of preventing forced asset sales, if other banks experience sharp deposit outflows. Friday also marked the end of the quarter, with the Dow and S&P 500 both posting back-to-back quarterly gains. The NASDAQ Composite booked a 16.8% quarterly gain, the best quarter since the 2020.  (MarketWatch – edited by QPI)

Click here for a video explanation of Erlanger Value Lines.

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

• Monday After the Close: None of note.
• Tuesday Before the Open:

Earnings of Note This Morning:

• Beats: SAIC +0.39 of note.
• Flat: None of note.
• Misses: None of note.
• Still to Report: None of note.

Guidance:

• Positive Guidance: PPG of note.
• Negative Guidance: SAIC of note.

Erlanger Research Advance/Decline Chart:

Gap Ups & Down In Early Pre-Market:

• Gap Up: RIG +7%, MRO +6%, HAL +5%, BUR +5%, USO +5%, OXY +4%, DVN +4%, WYNN +4%, SU +4%, SLB +4%, SHEL +4%, TTE +4%, BP +4% of note.
• Gap Down: KOD -5%, AMRS -4% of note.

Insider Action: WBA, GME sees Insider buying with dumb short selling.  No stock 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 to know before the stock market opens. (CNBC)
• 5 Things You Need to Know to Start Your Day. (Bloomberg) 
• Bloomberg Lead Story: OPEC+ Makes Shock Million-Barrel Cut in New Inflation Risk.  (Bloomberg)
• Bloomberg Most Read Story: Above story. (Bloomberg)
• Finland’s Prime Minister Marin unseated by pro-business party. (Bloomberg)
• Former President Trump to be indicted in New York City tomorrow, and plead not guilty. (Bloomberg)
• Treasuries Fall as OPEC+ Disrupts Fed-Pivot Wagers: Market Wrap. (Bloomberg)
• Morgan Stanley’s Wilson says US Tech Stocks Rally is Overdone. (Bloomberg)
• Oil surges +8% after OPEC+ blindsides market with production cut. (Bloomberg)
• WWE to merge with UFC to form new company controlled by Vince McMahon and Ari Emanuel. (CNBC)
• Chinese EV Brand Li Auto (LI) sees deliveries up 66%. (CNBC)

Moving Average Update:

• Score marches up to 91% from 85%.

Geopolitical: 

• President’s Public Schedule:
  • The President receives the President’s Daily Briefing, 9:00 a.m. EDT
  • The President departs Delaware Air National Guard Base en route to Hennepin County, Minnesota, 11:00 a.m. EDT
  • The President arrives in Hennepin County, Minnesota, 1:40 p.m. EDT
  • The President tours Cummins Power Generation Facility, 3:05 p.m. EDT
  • The President discusses how his economic agenda has led to the strongest job growth in history, over $435 billion in major private sector investments nationwide, stronger supply chains here at home, and a Made in America manufacturing and clean energy boom, 3:35 p.m. EDT
  • The President departs Hennepin County, Minnesota en route to Joint Base Andrews, 5:40 p.m. EDT
  • The President departs Joint Base Andrews en route to the White House, 8:00 p.m. EDT
  • The President arrives at the White House, 8:10 p.m. EDT

Economic:

• PMI Manufacturing Final 9:45 a.m. EDT
• February Construction Spending is due out at 10:00 a.m. EDT and is expected to improve to 0.0% from -0.10%.
• March ISM Manufacturing Index is also due out at 10:00 a.m. EDT and is expected to fall to 47.50% from 47.70%.
• Investor Movement Index 12:30 p.m. EDT

Federal Reserve / Treasury Speakers:

• Federal Reserve St. Louis President James Bullard 8:30 a.m. EDT
• Federal Reserve Board of Governors Lisa D. Cook 4:15 p.m.

M&A Activity:

• Brown & Brown, Inc. (BRO) announces the acquisition of Highcourt Breckles Group.
• Cyclerion Therapeutics (CYCN) Enters into Exclusive Negotiation Period and Binding Equity Investment Agreement.
• DecisionPoint (DPSI) Announces Acquisition of Macro Integration Services.
• Endeavor (EDR) Announces UFC and WWE to Form a $21+ Billion Global Live Sports and Entertainment Company.
• Enovis (ENOV) Corporation to acquire Novastep.
• Extra Space Storage (EXR) to Merge With Life Storage (LSI) in $12.7 Billion All-Stock Transaction, Executives Confirm — WSJ Deal Values Life Storage at $145.82 per Share, Executives Confirm. (WSJ)
• nVent (NVT) to Acquire ECM Industries, LLC.
• Ovintiv (OVV) close to deal to purchase $4 billion in oil assets in the Permian.
• SoFi Technologies, Inc. (SOFI) Acquires Leading Fintech Mortgage Lender, Wyndham Capital Mortgage.
• Stratasys (SSYS) Board of Directors Unanimously Rejects the Nano Dimension Revised Unsolicited Proposal of $19.55 Per Share.
• TECK Board of Directors Rejects Unsolicited Acquisition Proposal.

Meeting & Conferences of Note:

• Sellside Conferences:
  • Cantor the Future of Oncology Virtual Symposium (04/03/23-04/05/23)
  • GS Private Company Software and Internet Conference
  • Guggenheim Genomic Medicines and Rare Disease Days (04/03/23-04/05/23)
  • Jefferies Radiopharma Innovation Summit
  • Morgan Stanley Silicon Valley Software Bus Tour
    • Previously posted and ongoing conferences: None of note

• Company Meetings: DIS
• Fireside Chat: None of note.
• Investor/Analyst Day/Calls: EVA
• Update: None of note.
• R&D Day: None of note.
• Company Event: None of note.
• Industry Meetings:
  • World Vaccine Congress Washington D.C. 2023 (04/03/23-04/06/23)
  • 19th Orphan Drugs & Rare Diseases Global Congress Europe 2023 (04/03/23-04/04/23)
  • Sea Air Space: The Navy League’s Global Maritime Exposition 2023 (04/03/23-04/04/23)
    • Previously posted and ongoing conferences:
      • International Conference on Display Technology (03/31/23-04/03/23)

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: