The Daily Briefing For March 3rd: Well ... Can Stocks Break Their Three Week Losing Streak? So Far, Looks Like It Will.

by Geoff Garbacz | 03/03/2023 8:49 AM

Rebel Yell Morning Market Report

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The Daily Briefing For March 3rd: Well ... Can Stocks Break Their Three Week Losing Streak? So Far, Looks Like It Will.

Overnight SummaryThe S&P 500 closed Thursday higher by 0.76% at 3981.25. Wednesday lower by -0.47% at 3951.39.  The overnight high of 4002.50 was hit at 7:10 p.m. EST. The low was hit at 3974 at 9:45 p.m. EST, a range of ~28 points high to low.  At 7:25 a.m. EST, the S&P 500 (mini) was higher by 15.75 points which is 0.40%.

Earnings Out After The Close: 

  • Beats: COO +0.20, AVGO +0.17, VMW +0.17, DELL +0.16, AI +0.16, VSCO +0.13, ESTC +0.12, HPE +0.10, COST +0.10, ZS +0.08, JWN +0.07, VVX +0.03, CHPT +0.03 of note.
  • Flat: VTEX of note.
  • Misses: PAGS (0.04), XPOF (0.03), MRVL (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: None of note.
  • New SPACs launched/News:
    • OceanTech Acquisitions I Corp. (OTEC) confirms funding to extend period to consummate initial business combination.
    • Sakuu to Become Publicly Traded Company via Business Combination with Plum Acquisition Corp. I (PLMI).
  • Secondaries Priced:
    • BMBL: Prices 13.75 Million Share Secondary Offering at $22.80 per share.
    • BMRA: Announces Pricing of $8 Million Underwritten Public Offering of Common Stock, sells 3.33 Million shares at $2.40.
    • RVMD: prices offering. 13.63 Million shares at $22 per share.
  • Notes Priced of note:
  • Common Stock filings/Notes:
    • BMBL: Filed Form S-3ASR.. 101,768,345 Shares.
    • BMRA: Proposed Underwritten Public Offering of Common Stock. (Hallum Bookmanager)
    • CDTX: Underwritten Public Offerings of Common Stock and Preferred Stock. (Cantor bookmanager)
  • Direct Offering: None of note.
  • Selling Shareholders of note:
    • HF Sinclair (DINO) entered into a Stock Purchase Agreement with REH Company.
    • ECVT: Announces Secondary Offering of 11,490,444 Shares of Common Stock by Selling Stockholders AND Repurchase of Common Stock.
    • MIR: Announces Proposed Public Offering by Selling Stockholders.
  • Private Placement of Public Entity (PIPE):
    • RKDA: $6.0 Million Private Placement Priced at a Premium to Market Under Nasdaq Rules.
  • Mixed Shelf Offerings:
    • BHLB: Filed Form S-3ASR — Mixed Shelf.
    • CUBE: Files mixed securities shelf offering.
    • RYTM: Files mixed securities shelf offering.
    • SIVB: Filed Form S-3ASR Mixed Shelf.
  • Debt Filing/Notes: None of note.
  • Tender Offer: None of note.
  • Convertible Offering & Notes Filed:
    • EDTK: Announces US$1 Million Convertible Note Private Placement..

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: AI +17%, ARDX +9%, CRMD +8%, IAS +7%, XPOF +7%, SOI +7%, PAGS +6% of note.
    • Trading Down: VERU -39%, CDTX -16%, CHPT -13%, ZS -11%, MRVL -8%, BMBL -7%, MIR -4%, ESTC -4% of note.
  • News After The Close:   
    • Stocks making the biggest moves after hours: CHPT, ZS, MRVL, AI, HPE, DELL  (CNBC)
    • C3.ai (AI) stock rockets after earnings as company sees ‘dramatic change’ in sentiment. (MarketWatch)
    • Fed’s Waller: If Data Stays Hot, Policy Rate Should Go Above 5.1%-5.4%. (WSJ)
    • Bumble (BMBL) stock falls as CEO, Blackstone plan to sell shares. (MarketWatch)
    • Zscaler (ZS) stock drops more than 10% following outlook hike, job cuts (MarketWatch)
    • Citigroup (C) to lay off less than 1% of staff. (Reuters)
    • SEC Chair Gensler says crypto platforms not necessarily qualified custodians
  • Exchange/Listing/Company Reorg and Personnel News:
    • Delay 10-K filing: SPWR, PTRA, SIX, YOU, RIOT, FBRT, XMTR, LMND, NE
    • AppFolio (APPF) elects Shane Trigg as President and Chief Executive Officer.
    • Blue Apron (APRN) Announces NYSE Acceptance of Continued Listing Compliance Plan.
    • Dell Technologies (DELL) Announces Tom Sweet to Retire from the Company; Yvonne McGill Named CFO effective Q3 FY24.
    • Muscle Maker, Inc. (GRIL) Regains Compliance with Nasdaq Listing Requirements.
    • Personalis (PSNL) announces Christopher Hall as CEO and member of the Board effective immediately; Aaron Techibana promoted to COO
    • SPS Commerce (SPSC) Announces Planned Retirement of CEO.
    • Verizon (VZ) appoints Sowmyanarayan Sampath as CEO, Verizon Consumer Group, CFO Matt Ellis to Leave May 1.
    • Walmart (WMT) CEO Plans To Stay In Role At Least Three More Years. (WSJ)
    • Zoom Video (ZM) terminates employment of Greg Tomb as President, was “without cause” so company will pay $$$$. (Bloomberg)
  • Buyback Announcements or News:
    • ECVT (see Selling Shareholders above)
    • Solaris Oilfield Infrastructure (SOI) Announces Enhanced Shareholder Return Framework, Dividend Increase and Authorization of $50 Million Share Repurchase Program
  • Stock Splits or News: None of note.
  • Dividends Announcements or News:
    • Academy Sports + Outdoors (ASO) hikes its quarterly dividend by 20% to $0.09 per share.
    • BLK Goes ex div on Monday for $5.00.
    • DELL increase dividend by 12%.
    • Medtronic (MDT) declares $0.68 dividend.
    • Solaris Oilfield Infrastructure (SOI) (see Buyback)
    • SWK Goes ex div on Monday for $0.80.
    • Wyndham Hotels & Resorts (WH) increases its quarterly dividend 9% to $0.35 per share.

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

S&P 500 +8, Dow Jones +53,  NASDAQ +16, and Russell 2000 +4. (as of 7:56 a.m. EST).  Asia higher  and Europe higher as well. VIX Futures are at 20 from 21.40 yesterday.  Gold, Silver and Copper higher. WTI Crude Oil and Brent lower with Natural Gas higher. US 10-year Treasury sees yields at 4.015% from 4.03%  since yesterday. The U.S. Dollar is lower versus the Euro, lower versus the Pound and lower against the Yen. Bitcoin is at $22,333 from $23,346 yesterday, lower by  -4.94%.

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

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

U.S. stocks climbed Thursday, with gains across sectors offsetting declines in financial and consumer discretionary shares.  Major indexes began the day mostly lower. Markets have been under pressure lately as hot economic data have convinced many investors that the Federal Reserve is likely to keep interest rates higher for longer.  Stocks then wiped out their declines for the day after Atlanta Fed President Raphael Bostic said that he “still very firmly” supported raising interest rates in quarter-point increments as well as other comments that actually were not very dovish in nature yet the market took it as such, many did not understand the reaction. While the Fed had raised rates in bigger increments last year, Mr. Bostic said there was a “plausible case” that past rate increases would slow the economy more notably later on.  The S&P 500 rose 29.96 points, or 0.8%, to 3981.35. The Nasdaq Composite gained 83.50 points, or 0.7%, to 11462.98, and the Dow Jones Industrial Average advanced 341.73 points, or 1%, to 33003.57. (WSJ – 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)

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

Earnings of Note This Morning:

  • Beats: None of note.
  • Flat: None of note.
  • Misses: HIBB (0.05) of note.
  • Still to Report: None of note.

Guidance:

  • Positive Guidance: PTLO, KR, SFM, HPE, ZS, AI, COO, AVGO, IOT of note.
  • Negative Guidance: VTEX, VVX, MRVL, CHPT, JWN, DELL of note.

Erlanger Research Advance/Decline Chart:

Gap Ups & Down In Early Pre-Market:

  • Gap Up: AI +16%, ARDX +13%, CRMD +11%, XPOF +8%, IAS +7%, PAGS +6%, PSNL +4% of note.
  • Gap Down: VERU -31%, CDTX -17%, ZS -12%, CHPT -11%, MRVL -8%, EXEL -8%, BMBL -5%, ESTC -4% of note.

Insider ActionLAZY, NEE 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 Friday. (CNBC)
  • 5 Things You Need to Know to Start Your Day. (Bloomberg)
  • Bloomberg Lead Story: Investors Shore Up Stablecoins as Silvergate Exodus Worsens. (Bloomberg)
  • Bloomberg Most Read Story: iPhone Maker Plans $700 million India Plant in Shift From China. (Bloomberg)
  • Russian revenues from oil and gas almost halved in February. (Bloomberg)
  • Stocks now set for weekly gain as Bond Selloff Pauses. (Bloomberg)
  • Stock Futures Climb as Investors Seek To Stop a Three-Week Slide. (CNBC)
  • U.S. Equity Funds see biggest outflows in 2023. (Reuters)
  • Clueless Wall Street is racing to size up Zero Day Options Boom. (Bloomberg)
  • Hibbett Sporting Goods (HIBB) sales and profits fall below estimates and offers soft guidance. (MarketWatch)

Moving Average Update:

  • Score jumps to 57% from 31% thanks to the 5 day MA.

Geopolitical: 

  • President’s Public Schedule:
    • The President receives the Presidential Daily Briefing, 9:30 a.m. EST
    • The President awards the Medal of Honor to Ret. U.S. Army Colonel Paris Davis for his remarkable heroism during the Vietnam War, 11:30 a.m. EST
    • Press Briefing by Press Secretary Karine Jean-Pierre, 12:45 p.m. EST
    • The President holds a bilateral meeting with Chancellor Olaf Scholz of Germany, 2:00 p.m. EST
    • The President departs the White House en route to New Castle, Delaware, 3:45 p.m. EST
    • The President arrives in New Castle, Delaware, 4:40 p.m. EST

Economic:

  • PMI Composite Final 9:45 a.m. EST
  • February ISM Non-Manufacturing Index is also due out at 10:00 a.m. EST and is expected to drop to 54.5% from 55.2%.
  • Baker Hughes Rig Count 1:00 p.m. EST

Federal Reserve / Treasury Speakers:

  • Federal Reserve Bank of Dallas Lorie Logan 11:00 a.m. EST
  • Federal Reserve Atlanta President Raphael Bostic 11:45 a.m. EST
  • Federal Reserve Board of Governors Michelle Bowman 3:00 p.m. EST
  • Federal Reserve Richmond President Thomas Barkin 4:15 p.m. EST

M&A Activity:

  • Equinor (EQNR) acquires Suncor Energy UK for $850 million.
  • Ryerson (RYI) acquires BLP Holdings.

Meeting & Conferences of Note:

  • Company Meetings: FTS
  • Fireside Chat: None of note.
  • Investor/Analyst Day/Calls: APH
  • Update: None of note.
  • R&D Day: None of note.
  • Company Event: None of note.
  • Industry Meetings:

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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