The Daily Briefing For July 14th: Stocks Hit By High PPI

by Geoff Garbacz | 07/14/2022 10:07 AM

Rebel Yell Morning Market Report

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The Daily Briefing For July 14th: Stocks Hit By High PPI

Overnight Summary: The S&P 500 closed Wednesday at 3801.78(-0.45%) from 3854.43 (-1.15%) on Tuesday.  Futures are trading lower in the premarket session. The overnight high of 3805 was hit at 4:05 p.m. EDT. The low was hit at 3750 at 6:55 a.m. EDT, a range of 55 points high to low which is above the range of late with 45 the average range. At 7:25 a.m. EDT the current price is 3754 which is -1.33% and -50.50 points.

Earnings Out After The Close:

  • Beats: WAFD +0.13.
  • Flat: None of note.
  • Misses: None of note.

Capital Raises:

  • IPOs Priced or News: None of note.
  • New SPACs launched/News: None of note.
  • Secondaries Priced:
    • BLU: prices offering of 16,540,541 common shares at $9.25 per common share.
  • Notes Priced of note: None of note.
  • Common Stock filings/Notes:
    • CHPT: Filed Form 424B5.. $500,000,000 Common Stock.
    • KRBP: Filed Form S-1/A .. Up to 62,500,000 Shares of Common Stock.
  • Pricing of Over-Allotment/Notes: None of note.
  • Direct Offering:
    • VS: $2.16 Million Registered Direct Offering.. Roth Placement agent.
  • Selling Shareholders of note:
    • CMTL: Files for 1,377,422 share common stock offering by selling shareholder.
  • Private Placement of Public Entity (PIPE):
    • HCTI: Closing of $6.5 Million Private Placement.
  • Mixed Shelf Offerings:
    • CMTL: Files for $200 million mixed securities shelf offering.
  • 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.

  • After Hours: 
    • Trading Up: TBPH +25%, INVA +9%, GRBK +7%.
    • Trading Down: CFRX -77%, AZTA -11%, BLU -6%, HMN -5%.
  • News Since The Close:
    • US Treasury Curve Most Inverted Since 2000. (FT)
    • Twitter (TWTR) CEO Parag Agrawal, in email dated July 12, says current environment macroeconomic, geopolitical, societal presents additional complexities, challenges for us and our industry.
    • Tesla (TSLA): Andrej Karpathy, Director of AI where he leads computer vision team of Tesla Autopilot to step down.
    • Embattled crypto lender Celsius informs state regulators that it’s filing for bankruptcy ‘imminently,’ source says (CNBC)
    • Bank of America slashes S&P 500 target, sees stocks falling another 5% by year-end. (CNBC)
    • “The majority of clients that I speak to believe that another retest of YTD lows is necessary with some suggesting the ultimate downside in the $SPX is 3200 – 3400; that range represents a level that they would buy irrespective of the broader macro environment.” – (JPM desk Carl Q CNBC)
    • Moody’s On Governments Of Germany And Italy Says Halt To Russian Gas Supplies Would Significantly Weaken Growth And Fiscal Metrics.
    • China Considers Ending Australia Coal Ban On Russia Supply Fears. (Bloomberg)
    • Kids and teens now spend more time watching TikTok than YouTube, new data shows. (TechCrunch)
    • Federal Reserve Cleveland President Loretta Mester:
      • CPI report was uniformly bad, inflation is too high tightening has to be very deliberate and intentional.
      • Not seen any convincing evidence inflation has peaked.
      • Expect fed will need to go well beyond neutral rate.
      • At the July meeting, we’ll talk about the policy path.
      • CPI data does not suggest going smaller than June hike.
      • Inflation is stubborn and recession risks have risen.
    • Raytheon Technologies (RTX) awarded $350 million Army contract.
    • Monthly Assets Under Management:
      • VCTR $154.9 billion
      • MN $18.5 billion
  • Exchange/Listing/Company Reorg and Personnel News:
    • Blackbaud (BLKB) Announces Executive Leadership Updates.
    • Tradeweb Markets (TW) names Thomas Pluta as its next President.
    • Vinco Ventures (BBIG) Appoints Ted Farnsworth as Co-CEO.
  • Buyback Announcements or News:
    • JPMorgan (JPM) CEO Jamie Dimon says temporarily suspended share buybacks which will allow us maximum flexibility to best serve our customers, clients and community through a broad range of economic environments.
  • Stock Splits or News: None of note.
  • Dividends Announcements or News: 
    • Walgreens Boots Alliance (WBA) Increases Quarterly Dividend.

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

S&P 500 -52Dow Jones -428NASDAQ -110, and Russell 2000 -25. Europe lower and Asia lower ex Japan.  VIX Futures are at 28.61 from 28.60 yesterday morning and the VIX closed at 26.82 from 27.29  yesterday. Gold, Silver and Copper lower. WTI Crude Oil  and Brent Oil Futures lower and Natural Gas higher. $ is higher vs Euro, higher vs Pound and higher vs Yen. US 10 year Treasury sees yields at 2.958% from 2.948% yesterday morning. Bitcoin is at $16,691 from $19,776.66 yesterday morning and is higher by 0.06% this morning. As of 8:09 a.m. EDT.

Sector Action – 07/13/22 Close (1/3/6/12/YTD Updated Weekly with Monday release):   

  • Daily Positive Sectors: Consumer Cyclicals, Energy, Basic Materials of note.
  • Daily Negative Sectors: Communication Services, Industrials, Financials, Healthcare, Real Estate of note.
  • One Month Winners: Healthcare  of note.
  • Three Month Winners: none of note.
  • Six Month Winners: Energy of note.
  • Twelve Month Winners: Energy and Utilities of note.
  • Year to Date Winners: Energy of note.

Tubrbulant day starting with high print of the CPI.  Market stabilized and almost righted the ship until a Wall St. Journal article mentioned a Fed “insider” pointing to a 75 bp hike vs. 100 in July which caused the markets to pullback into the close.  TLT still up 1.15% on the day closing at $116.44.  Updated 07/13/22 close.

 

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

  • Thursday After the Close: AOUT of note.
  • Friday Before the Open: BLK, BK, C, PNC, PGR, STT, USB, UNH, WFC of note.

Earnings of Note This Morning:

  • Beats: TSM +0.62,FRC +0.08, CAG +0.02.
  • Flat: None of note.
  • Misses: ERIC (0.33), MS (0.17), JPM (0.15).
  • Still to Report: CTAS.

Guidance:

  • Positive Guidance: TSM of note.
  • Negative Guidance: AZTA, HMN, PCRX, CAG of note.

Erlanger Research Advance/Decline Chart: Updated through 07/13/22 close.

Gap Ups & Down In Early Pre-Market:

  • Gap Up: TBPH +18%, GRBK +8%, TGA +6%, INVA +6%, ANGI +5%, VCYT +4%.
  • Gap Down: CFRX -75%, EGY -14%, ERIC -8%, AZTA -6%, BLU -6%.

Insider ActionTELA, THO sees Insider buying with dumb short selling.  SHAK sees Insider buying with smart short sellers. 07/13/22 close.

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

  • Stocks Making The Biggest Moves: JPM, MS, TWTR, CAG (CNBC)
  • 5 things to know before the stock market opens Thursday (CNBC)
  • Five Things You Need to Know to Start Your Day (Bloomberg)
  • Bloomberg Lead Story: JP Morgan halts buybacks as earnings miss. (Bloomberg)
  • Bloomberg Most Read Story: US Inflation amps Fed to “go big”. (Bloomberg)
  • Treasury Secretary Yellen says inflation “unacceptably high” and presses Congress for reconciliation bill. (MarketWatch)
  • United Airline (UAL) to renegotiate with pilots. (CNBC)
  • Amazon (AMZN) looking to settle antitrust charges in the EU. (WSJ)
  • JP Morgan (JPM) sees earnings fall -28% with Dimon cautious on economy. (Reuters)
  • Morgan Stanley (MSM) misses on revenues and earnings as investment banking slows. (CNBC)
  • Intel (INTC) to raise prices on microprocessors and chip products later this year. (Nikkei)
  • Shell (SHEL) notes that they may have to ration energy in the winter. (Reuters)
  • Rent prices in Manhattan hit new high. (Bloomberg)
  • Robinhood Snacks looks at inflation as experts hope the worst is over. Delta (DAL) posts best quarter since pandemic began.

Moving Average Update:

  • Score drops to 8% from 20%.  Updated 07/13/22 close.

Geopolitical: 

  • President’s Public Schedule:
    • The President participated in a bilateral meeting with Prime Minister Yair Lapid of Israel, 4:15 a.m. EDT
    • The President participated in the first Leaders meeting of the “I2U2” group with the Leaders of Israel, India, and the United Arab Emirates, 5:30 a.m. EDT
    • The President participated in a press conference with Prime Minister Yair Lapid of Israel, 7:00 a.m. EDT
    • The President meets with President Isaac Herzog of Israel, 9:45 a.m. EDT
    • The President meets with Former Prime Minister Benjamin Netanyahu, 10:20 a.m. EDT
    • The President attends a reception hosted by President Isaac Herzog, where he will receive the Israeli Presidential Medal of Honor, 11:20 a.m. EDT
    • The President greets with U.S. athletes and views the opening ceremonies of the Maccabiah Games, 12:45 p.m. EDT

Economic: 

  • June PPI  is due out at 8:30 a.m. EDT and expected to come in at 0.9% from 0.8%. 
  • Initial Jobless Claims 8:30 a.m. EDT 
  • Natural Gas Report 10:30 a.m. EDT

Federal Reserve / Treasury Speakers:

  • None of note.

M&A Activity:

  • CURO Completes Acquisition of First Heritage Credit and Adds Funding Capacity.
  • Molina Healthcare (MOH) to Acquire My Choice Wisconsin.
  • Royalty Pharma (RPRX) Agrees to Acquire Royalty Interest in TRELEGY ELLIPTA From Theravance and Innoviva for $1.31 Billion and Potential Milestones of $300 Million.

Meeting & Conferences of Note:

  • Sellside Conferences:
    • Concordia 2022 Americas Summit
    • Wolfe-Nomura Alliance Low Carbon Fuel & Feedstocks Private/Public
      • Previously posted and ongoing conferences:
        • CEO Summit with SEMICON West (07/12/22-07/14/22)
        • Demy Colton Biotech CEO Summit
        • Mizuho Securities FORTUNE Brainstorm Tech
        • Needham Virtual AdTech and CTV Measurement Conference 2022 (07/12/22-07/14/22)
        • SVB Therapeutics Forum
  • Company Meetings: None of note.
  • Fireside Chat: None of note.
  • Investor/Analyst Day/Calls: LBPH, MDC
  • Update: None of note.
  • R&D Day: None of note.
  • Company Event:
    • InstructureCon 2022 (INST)
    • Humacyte Key Opinion Leader Webinar on Human Acellular Vessel in the Treatment of Vascular Trauma. (HUMA)
  • Industry Meetings:
    • None of note.
      • Previously posted and ongoing conferences:
        • American Society of Retina Specialists (ASRS) 40th Annual Meeting 2022 (07/13/22-07/16/22)
        • Acute Respiratory Distress Syndrome (ARDS) Drug Development Summit 2022 (07/13/22-07/15/22)
        • 12th London International Cough Symposium (LICS) (07/13/22-07/14/22)
        • Advanced Wound Care Summit 2022 (07/13/22-07/14/22)
        • Controlled Release Society (CRS) 2022 Annual Meeting & Expo (07/11/22-07/15/22)

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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