The Daily Briefing For February 3rd: Can Stocks Continue To Climb As High As Chinese Spy Balloon?

by Geoff Garbacz | 02/03/2023 9:11 AM

Rebel Yell Morning Market Report

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The Daily Briefing For February 3rd: Can Stocks Continue To Climb As High As Chinese Spy Balloon?

Overnight SummaryThe S&P 500 closed Thursday higher by 1.47% at 4179.76 from Wednesday higher by 1.05% to close at 4119.21.  The overnight high of 4207 was hit at 4:05 p.m. EST. The low was hit at 4152.75 at 3:50 a.m. EST, a range of ~55 points high to low.  At 7:10 a.m. EST, the S&P 500 (mini) was lower by -24.50 points which is -0.58%.

Great Story Leading Into The Weekend: Lives Lived: In 1973, John Adams brought his bass drum to a Cleveland Indians game. They won, and a tradition was born. Adams loudly banged his drum at more than 3,700 home games. He died at 71.

Earnings Out After The Close: 

  • Beats: DECK +0.89, POST +0.46, HIG +0.44, CRUS +0.41, PCTY +0.38, DLB +0.32, CLX +0.32, MANH +0.31, ATGE +0.29, BILL +0.28, MEOH +0.27, X +0.24, BYD +0.23, OTEX +0.18, COLM +0.17, TEAM +0.16, GILD +0.16, NFG +0.15, SKX +0.11, HUBG +0.08, SXI +0.08, BZH +0.06, MWA +0.05, EXPO +0.04, VIAV +0.03, GPRO +0.03, SNCY +0.03, TWOU +0.02, CLFD +0.02, GEN +0.02, MCHP +0.02, OHI +0.02, QCOM +0.02, SIGI +0.02 of note.
  • Flat: ENSG of note.
  • Misses: MSTR (21.49), SKYW (1.03), RGA (0.74), MTX (0.52), CNMD (0.48), KMPR (0.42), PFSI (0.40), AMZN (0.14), GOOG (0.14), SYNA (0.14), F (0.11), AAPL (0.07), WWE (0.06), LPLA (0.05), CTSH (0.02), SBUX (0.02), CPT (0.01), LESL (0.01) of note.

Unusual Options Activity:

Daily Screen in Erlanger Chartroom that highlights unusual Call and Put Options activity.  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:
    • Structure Therapeutics (GPCR) 10.74 Million share IPO priced at $15 per share.
  • New SPACs launched/News: None of note.
  • Secondaries Priced:
    • AVTX: Pricing of $15 Million Public Offering of Common Stock and Warrants. Priced @$5.
    • CLLS: prices offering. 8.8 Million ADS at $2.50 per ADS.
    • EDBL: Pricing of Upsized $10.2 Million Underwritten Public Offering. Priced @$6.30 per unit.
    • ROIV: Pricing of Upsized Public Offering of Common Shares. Priced @$7.50.
    • TWO: Announces Pricing of Public Offering of 10 million shares of common stock for expected proceeds of $178 million.
  • Notes Priced of note:
    • LEN: Prices $1.6 billion senior notes offering. (see Mixed Shelf filing too)
    • MPLX: prices $1.6 billion senior notes offering.
    • UNIT: Announces Pricing of Upsized Senior Secured Notes Offering and Full Redemption of 7.875% Senior Secured Notes due 2025.
  • Common Stock filings/Notes:
    • AIHS: Form RW — withdrawal of the Company’s registration statement on Form S-3.
    • CLLS: Launch of Follow-On Offering $22 Million. (Jefferies and BCS Bookmanagers)
    • SIDU: Closing of $5.2 Million Public Offering and Full Exercise of Underwriters’ Over-Allotment Option.
    • TWO: Commences an underwritten public offering of 10 mln shares of its 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:
    • FSBC: Form S-3.. $250 Million Mixed Shelf.
      JCI: Filed Form S-3ASR.. Mixed Shelf Offering.
    • LEN: Files mixed securities shelf offering MPLX.
  • Debt Filing/Notes:
    • ARE: Announces Pricing of Public Offering of $500,000,000 of Senior Notes due 2035 $500,000,000 of Senior Notes due 2053.
    • NCLH: Closing of $600,000,000 of Senior Secured Notes.
  • Tender Offer: None of note.
  • Convertible Offering & Notes Filed: None of note.

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: SNCY +16%, BYD +6%, PCTY +5%, CLX +4%, GILD +4% of note.
    • Trading Down: BILL -21%, SI -19%, PFSI -13%, TEAM -13%, CLFD -8%, CLLS -8%, TWOU -8%, BZH -7%, F -6%, CNMD -5%, SYNA -5%, LESL -5%, RGA -4% of note.
  • News After The Close:   
    • Stocks making the biggest moves after hours: AAPL, AMZN, F, GOOGL, QCOM, SBUX, TEAM, SKX, CRUS, GILD, CLX (CNBC)
    • Apple (AAPL) Blames Rotten Holiday Quarter on Supply Chain, Economy. (Bloomberg)
    • Alphabet (GOOGL) misses on earnings and revenue as YouTube falls short. (CNBC)
    • Ford (F) logs $2 billion loss in 2022, says profit was left ‘on the table’. (MarketWatch)
    • Amazon’s (AMZN) Slowing Cloud-Computing Sales Expected to Linger. (Bloomberg)
    • Starbucks (SBUX) stock falls as earnings — weighed down by China sales — miss estimates. (MarketWatch)
    • Qualcomm (QCOM) revenue falls 12%, guidance implies more pain this quarter. (CNBC)
    • Silvergate (SI) faces DOJ fraud probe over FTX and Alameda dealings. (Bloomberg)
    • Activist Investor Ryan Cohen Takes Stake in Nordstrom (JWN). (WSJ)
  • Exchange/Listing/Company Reorg and Personnel News:
    • Amarin (AMRN) Mails Letter to Shareholders Highlighting New Board and Superior Leadership.
    • Apartment Investment & Mgmt (AIV) announces that its Board of Directors has named R. Dary Stone as Chairman of the Board.
    • Invivyd (IVVD) Announces Changes to Executive Team. Laura Walker, Ph.D., the company’s chief scientific officer and co-founder is leaving the company.
    • Iteris Holdings (ITI) announces that Kerry A. Shiba will join the company as senior vice president & CFO.
    • IAC Inc. (IAC) appointed Christopher Halpin to the newly created role of Chief Operating Officer and will continue in his role as CFO.
    • Kohl’s (KSS) Appoints Tom Kingsbury as Chief Executive Officer.
    • Lakeland Industries (LAKE) announces appointment of Roger Shannon as CFO.
    • Midatech Pharma PLC (MTP) Announces Receipt of NASDAQ Notice.
    • Oragenics, Inc. (OGEN) Regains Compliance with NYSE American.
    • Palantir Technologies (PLTR) appointed COO Shyam Sankar to the new role of Chief Technology Officer and EVP.
    • Qudian Inc. (QD) Regains Compliance with NYSE Minimum Price Requirement.
    • VYNT CEO and CSO to step down.
    • Worthington Industries (WOR) Announces Leadership Teams for New Worthington and Worthington Steel and Related Activities.
  • Buyback Announcements or News: 
    • (BILL) approves a share repurchase program with authorization to purchase up to $300 million.
    • MICT: Announces Repurchase Agreement with holders of outstanding warrants.
    • Northrop Grumman (NOC) entered into an accelerated share repurchase agreement with Bank of America, N.A. to repurchase $500 million.
    • REGN announces new $3 Billion share repurchase program.
  • Stock Splits or News: None of note.
  • Dividends Announcements or News:
    • Allete (ALE) increases quarterly dividend to $0.6775 per share, A $0.0225 increase.
    • Avista (AVA) raises quarterly dividend to $0.46 per share. a 4.5% raise.
    • Columbia Sportswear (COLM) Board of Directors approved a regular quarterly cash dividend of $0.30 per share.
    • Exponent (EXPO) raised its quarterly dividend to $0.26 from $0.24 per share.
    • FE Goes ex div on Monday for $0.39.
    • INTC Goes ex div on Monday for $0.365.
    • Gilead Sciences (GILD) increases quarterly cash dividend $0.02 to $0.75 per share. (MarketWatch)
    • Invitation Homes (INVH) Announces Over 18% Increase to Cash Dividend.
    • Microchip (MCHP) announced today that its Board of Directors declared a record quarterly cash dividend on its common stock of 35.8 cents per share, up 9.1%.
    • Polaris Industries (PII) increases quarterly cash dividend $0.01 to $0.65 per share.
    • Southside Banc (SBSI) increases quarterly cash dividend to $0.35 per share.

What’s Happening This MorningFutures value reflects the change with fair value.

S&P 500 -22, Dow Jones -67,  NASDAQ -118, and Russell 2000 -3 . (as of 7:58 a.m. EST).  Asia is higher and European markets are trading lower ex the FTSE. VIX Futures are at 19.50 from 19.61 yesterday.  Gold and Silver lower with Copper higher.  WTI Crude Oil and Brent are lower with Natural Gas higher. US 10-year Treasury sees yields at 3.394% from 3.405% yesterday. The U.S. Dollar is lower versus the Euro, lower versus the Pound and lower against the Yen. Bitcoin is at $23,504 from $23,827  yesterday, lower by  -1.28%.

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

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

The Nasdaq Composite jumped to its highest level in nearly five months, powered by a resurgence in big technology stocks and investors’ hopes that the Federal Reserve could pivot from hiking interest rates to cutting them later this year.  The Nasdaq rose 384.50 points on Thursday, or 3.3%, to 12200.82. The tech-focused index is having its best start to a year since 1975.  The broad-based S&P 500 advanced 60.55, or 1.5%, to 4179.76 in its third consecutive day of gains. The Dow Jones Industrial Average was the laggard, slipping 39.02, or 0.1%, to 34053.94 on weakness in some healthcare stocks.  Alphabet and posted gains of more than 7%, and Apple rose more than 3%. All three reported earnings after the closing bell. Intel and Tesla also climbed more than 3%. (WSJ)

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)

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

Earnings of Note This Morning:

  • Beats: REGN +2.55, PIPR +0.79, TWST +0.43, AON +0.23, CI +0.09, ZBH +0.05, CBOE +0.04, AVTR +0.02, CHD +0.02, LYB +0.02 of note.
  • Flat: WT, SNY of note.
  • Misses: SAIA (0.16), ARCB (0.08), EAF (0.05), MOG.A (0.03), BEP (0.01) of note.
  • Still to Report: None of note.


  • Positive Guidance: DGII, ITW, PCTY, MANH, TEAM, DLB, MCHP, SNCY, ENSG, GILD, ZBH of note.
  • Negative Guidance: CTSH, SKX, GEN, CPT, CLFD, SYNA, CIM, CI of note.

Erlanger Research Advance/Decline Chart:

Gap Ups & Down In Early Pre-Market:

  • Gap Up: MWA +8%, BYD +5%, MANH +4%, PCTY +4%, VIAV +4%, CLX +4% of note.
  • Gap Down: HUBG -33%, BILL -20%, PFSI -13%, SI -12%, TEAM -12%, CLLS -10%, CLFD -9%, SYNA -8%, F -7%, CNMD -6%, AMZN -5%, LESL -5%, SKYW -5%, GOOG -5%, GPRO -5%, MSTR -4%, BZH -4%, TWO -4%, RGA -4% of note.

Insider Action: No stock sees Insider buying with dumb short selling.  BY, COIN 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:  Apple, Alphabet and Amazon Hurt As Economic Slump Crimps Demand. (Bloomberg)
  • Bloomberg Most Read Story: A Billionaire’s Son Battles a Turbulent WWE Over The Future of Pro Wrestling. (Bloomberg)
  • Chinese Spy Balloon Floating Over the Northwest section of the United States. (Bloomberg)
  • China tells U.S. to remain “cool headed” over suspected spy ballon. (CNBC)
  • Brazil’s industrial output drops in second half of 2022. (Reuters)
  • Food costs are tumbling but shoppers still face soaring bills. (Bloomberg)

Moving Average Update:

  • Day 3 at 100% and we continue the march upwards.


  • President’s Public Schedule:
    • The President receives the Presidential Daily Briefing, 8:30 a.m. EST
    • The President departs the White House en route Joint Base Andrews, 1:00 p.m. EST
    • The President departs Joint Base Andrews en route Philadelphia International Airport, 1:20 p.m. EST
    • The President arrives in Philadelphia, Pennsylvania, 2:00 p.m. EST
    • The President and The Vice President deliver remarks on the progress the country has made and their work implementing the Biden-Harris economic agenda that continues to deliver results for the American people, 3:15 p.m. EST
    • The President and The Vice President participate in a reception for the Democratic National Committee, 5:15 p.m. EST
    • The President and The Vice President will deliver remarks at the Democratic National Committee Winter Meeting, 6:00 p.m. EST
    • The President departs Philadelphia International Airport en route New Castle, Delaware, 7:10 p.m. EST
    • The President arrives in New Castle, Delaware, 7:25 p.m. EST


  • January Nonfarm Payrolls are due out at 8:30 a.m. EST and are expected to come in at 190,000 from 223,000 in December. The unemployment rate is expected to rise to 3.6% from 3.5%.
  • PMI Composite Final 9:45 a.m. EsT
  • January ISM Non-Manufacturing Index is due out at 10:00 a.m. EST as well and is expected to come in at 50.3% from 49.60% in December.
  • Baker Hughes Rig Count 1:00 p.m. EsT

Federal Reserve / Treasury Speakers: None of note.

M&A Activity:

  • Gartner (IT) sells TalentNeuron to Leeds Equity Partners.
  • Thorne Healthtech (THRN) Acquires Precon Health for $5 million.

Meeting & Conferences of Note:

  • Sellside Conferences:
  • Company Meetings: AEHA, UAVS
  • Fireside Chat: None of note.
  • Investor/Analyst Day/Calls: CHD, PULM
  • Update: None of note.
  • R&D Day: None of note.
  • Company Event: None of note.
  • Industry Meetings: None of note.

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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