{"id":12700,"date":"2020-05-14T05:53:33","date_gmt":"2020-05-14T10:53:33","guid":{"rendered":"https:\/\/www.eoption.com\/2020\/05\/14\/morning-preview-may-14-2020\/"},"modified":"2020-05-14T05:53:33","modified_gmt":"2020-05-14T10:53:33","slug":"morning-preview-may-14-2020","status":"publish","type":"post","link":"https:\/\/www.eoption.com\/morning-preview-may-14-2020\/","title":{"rendered":"Morning Preview: May 14, 2020"},"content":{"rendered":"
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Early Look<\/o:p><\/span><\/b><\/p>\n

Thursday, May 14, 2020<\/span><\/b><\/o:p><\/span><\/b><\/p>\n\n\n\n\n\n\n
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Futures<\/o:p><\/span><\/p>\n<\/td>\n

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Up\/Down<\/o:p><\/span><\/p>\n<\/td>\n

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%<\/o:p><\/span><\/p>\n<\/td>\n

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Last<\/o:p><\/span><\/p>\n<\/td>\n<\/tr>\n

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DJ Industrials<\/span><\/b><\/o:p><\/span><\/p>\n<\/td>\n

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-34.00<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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0.15%<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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23,132<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n<\/tr>\n

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S&P 500<\/span><\/b><\/o:p><\/span><\/p>\n<\/td>\n

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-1.50<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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0.06%<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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2,811<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n<\/tr>\n

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Nasdaq<\/span><\/b><\/o:p><\/span><\/p>\n<\/td>\n

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13.50<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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0.15%<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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9,006<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

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Stock futures in the U.S. are mixed to down slightly, faring better than markets in Europe and Asia, as major averages try to recover from the recent 2-day slide that has pushed major averages lower by4% during that stretch. Stocks have tumbled the last few sessions following cautious commentary from Fed Chairman Powell, two prominent hedge fund names (Tepper, Druckenmiller), weak CPI<\/span> and PPI<\/span> economic data heading into more dubious jobs data today, and concerns from infectious disease expert Fauci, warning about the damage that can be done if economies are opened to quickly. In stock news, shares of Dow component Cisco (CSCO<\/span>) are higher following better quarterly results overnight and stronger than expected guidance. In economic data later today, first time unemployment claims are expected at 2.5M, bringing the total of jobless claims over the last 2-months to over 35M. Last week the government said the U.S. unemployment rate surged to a post-World War Two high of 14.7%, or almost 20% if adjusted for furloughs. Geopolitical tensions also weighing on sentiment as the U.S. accused China of trying to steal vaccine information while France objected to one of its drugmakers, Sanofi (SNY<\/span>), saying it would give U.S. priority to a coronavirus vaccine. In Asian markets, The Nikkei Index dropped -352 points to move back below the 20,000 level at 19,914, the Shanghai Index dropped -27 points to 2,870 and the Hang Seng Index fell -350 points to 23,829. In Europe, the German DAX<\/span> is lower by nearly -200 points (1.8%) at 10,350, while the FTSE 100 is down over -130 points (2.3%) to 5,765.<\/o:p><\/p>\n

Market Closing Prices Yesterday<\/o:p><\/p>\n

·     <\/span><\/span><\/span>The S&P 500 Index<\/b> plunged -50.12 points<\/span>, or 1.75%, to 2,820.00<\/o:p><\/p>\n

·     <\/span><\/span><\/span>The Dow Jones Industrial Average<\/b> fell -516.81 points<\/span>, or 2.17%, to 23,247.97<\/o:p><\/p>\n

·     <\/span><\/span><\/span>The Nasdaq Composite <\/b>dropped -139.38 points<\/span>,<\/span> or 1.55%, to 8,863.17<\/o:p><\/p>\n

·     <\/span><\/span><\/span>The Russell 2000 Index<\/b> declined -42.29 points<\/span>, or 3.32% to 1,233.25<\/o:p><\/p>\n

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<\/a><\/a><\/a>Economic Calendar for Today<\/o:p><\/a><\/p>\n

·     <\/span><\/span><\/span>8:30 AM EST      Weekly Jobless Claims…est. 2.5M<\/o:p><\/p>\n

·     <\/span><\/span><\/span>8:30 AM EST      Continuing Claims…est. 25.12M<\/o:p><\/p>\n

·     <\/span><\/span><\/span>8:30 AM EST      Import Prices MoM for April…est. (-3.2%)<\/o:p><\/p>\n

·     <\/span><\/span><\/span>8:30 AM EST      Export Prices MoM for April…est. (-2.3%)<\/o:p><\/p>\n

·     <\/span><\/span><\/span>10:30 AM EST    Weekly EIA Natural Gas Inventory Data<\/o:p><\/p>\n

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Earnings Calendar: <\/o:p><\/p>\n

·     <\/span><\/span><\/span>Earnings Before the Open: ACHV<\/span>, EQM<\/span>, IZEA<\/span>, KEM<\/span>, SSYS<\/span>, TRXC<\/span>, VTNR<\/span><\/o:p><\/p>\n

·     <\/span><\/span><\/span>Earnings After the Close: AMAT<\/span>, BLFS<\/span>, CVET<\/span>, DENN<\/span>, NLOK<\/span>, VRML<\/span><\/o:p><\/p>\n

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Other Key Events: <\/o:p><\/p>\n

·     <\/span><\/span><\/span>The American Society of Gene & Cell Therapy (ASGCT) 2020 Annual Meeting will be taking place virtually next week 5\/12-5\/15<\/o:p><\/p>\n

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Macro<\/o:p><\/span><\/p>\n<\/td>\n

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Up\/Down<\/o:p><\/span><\/p>\n<\/td>\n

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Last<\/o:p><\/span><\/p>\n<\/td>\n<\/tr>\n

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WTI Crude<\/span><\/b><\/o:p><\/span><\/p>\n<\/td>\n

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1.21<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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26.50<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n<\/tr>\n

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Brent<\/span><\/b><\/o:p><\/span><\/p>\n<\/td>\n

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1.12<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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30.31<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n<\/tr>\n

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Gold<\/span><\/b><\/o:p><\/span><\/p>\n<\/td>\n

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-10.10<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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1,726.50<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n<\/tr>\n

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EUR\/USD<\/o:p><\/span><\/b><\/p>\n<\/td>\n

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-0.0021<\/o:p><\/span><\/p>\n<\/td>\n

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1.0797<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n<\/tr>\n

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JPY\/USD<\/o:p><\/span><\/b><\/p>\n<\/td>\n

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-0.07<\/span><\/o:p><\/span><\/p>\n<\/td>\n

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106.96<\/span><\/o:p><\/span><\/p>\n<\/td>\n<\/tr>\n

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10-Year Note<\/o:p><\/span><\/b><\/p>\n<\/td>\n

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-0.035<\/span><\/o:p><\/span><\/p>\n<\/td>\n

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0.616%<\/span><\/o:p><\/span><\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

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World News<\/o:p><\/p>\n

·     <\/span><\/span><\/span>The global case tally for the coronavirus that causes COVID-19 climbed to 4.36 million on Thursday, according to data from by Johns Hopkins University. The death toll rose to 297,465. More than 1.6 million people have recovered. The U.S. has the highest case toll at 1.39 million and the highest death toll at 84,136. Russia has 252,245 cases and 2,305 deaths.<\/o:p><\/p>\n

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Sector News Breakdown<\/o:p><\/span><\/p>\n

Consumer<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Flowers Foods (FLO<\/span>)<\/b> Q1 adjusted EPS 41c\/$1.349B vs. est. 33c\/$1.32B; maintains FY guidance for adj EPS $1.00-1.08 vs. est. $1.06; sees FY capex $95M to $105M, saw $105M to $115M<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Jack in the Box (JACK<\/span>)<\/b> Q2 adjusted EPS 50c\/$216.16M vs. est. 65c\/$210.76M; Q2 system same-store sales decreased (-4.2%), company same-store sales decreased (-4.1%) driven by average check growth of 6.4% while transactions decreased (-10.5%); said system same-store sales increased 5.2% in the seven weeks ended March 8, 2020, prior to any impacts from the COVID-19 pandemic; suspends quarterly cash dividend and share repurchases; restaurant-level margin declined by 700 basis points to 20.6% of sales vs. 27.6% a year ago<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Tyson Foods (TSN<\/span>)<\/b> will cut prices for some beef products by 20%-30% in response to surging prices caused by coronavirus outbreaks at meatpacking plants, as per the WSJ. TSN says it will reduce prices for ground beef, roasts and other beef products<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Penske Automotive Group Inc. (PAG<\/span>)<\/b> suspended its dividend as of May 13 (was 42c)<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Revolve Group (RVLV<\/span>)<\/b> 1Q EPS $0.06 vs. est. $0.04, net sales $146.1Mm vs. est. $139.6Mm; seen trend improvement since mid-Apr, with first ten days of May -25% YoY<\/o:p><\/p>\n

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Energy, Industrials and Materials<\/o:p><\/p>\n

·     <\/span><\/span><\/span>U.S. Energy Department says<\/b> it will buy up to 1 mln barrels of sweet crude oil for strategic reserve from small to midsize domestic producers; says oil purchase for SPR will serve as a test of conditions of physical crude oil available to the reserve – Reuters<\/o:p><\/p>\n

·     <\/span><\/span><\/span>The IEA said<\/b> the world’s demand for crude will drop by 21.5 million barrels a day this month, while crude-producing nations and companies will slash output by 12 million barrels a day.<\/o:p><\/p>\n

·     <\/span><\/span><\/span>3M Co. (MMM<\/span>)<\/b> said monthly sales declines as a result of the COVID-19 pandemic were in line with the trends discussed during the Q1 earnings call on April 28; said April sales fell 11% from a year ago to $2.3 billion. A 5% increase in health care sales was offset by declined of 5% in consumer, 11% in safety and industrial and 20% in transportation and electronics<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Comstock Resources (CRK<\/span>)<\/b> 40M share Spot Secondary priced at $5.00<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Mueller Water (MWA<\/span>)<\/b> said it took a series of cost saving measures including temporarily shutting down plants and a furlough or salary reduction program for substantially all employees<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Newmont (NEM<\/span>)<\/b> said it expects to begin ramping up operations at its Peñasquito mine in Mexico on May 18, following the government’s designation of mining as an essential activity.<\/o:p><\/p>\n

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Financials<\/o:p><\/p>\n

·     <\/span><\/span><\/span>MasterCard (MA<\/span>)<\/b> said it sees normalization in some markets, as restrictions ease and consumer spending levels gradually recover from new lows; says services growth will continue to outperform its core products in Q2; says cross-border volume continues to be impacted by decline in travel, but saw modest improvements over the last week in part due to an increase in intra-Europe travel<\/o:p><\/p>\n

·     <\/span><\/span><\/span>A new report from Oxford Economics estimates that 15% of homeowners will fall behind on their monthly mortgage payments. Nearly 4 million homeowners are in the midst of forbearance plans, representing 7.54% of all mortgages, according to the latest data from the Mortgage Bankers Association,<\/o:p><\/p>\n

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Healthcare<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Allogene Therapeutics (ALLO<\/span>)<\/b> shares rise 25%; announced the release of the abstract related to an upcoming oral presentation at the American Society of Clinical Oncology Annual Meeting. This will be the first data from Allogene’s Phase 1 dose escalation study of ALLO-501 in relapsed\/refractory non-Hodgkin lymphoma.<\/o:p><\/p>\n

·     <\/span><\/span><\/span>1Life Healthcare (ONEM<\/span>)<\/b> Q1 EPS loss (40c)\/$78.8M vs. est. loss (17c)\/$75M; said Q1 ending membership count of approximately 455,000, a 25% increase year-over-year; boosts 2020-end membership guidance to 500,000-515,000 from 495,000-510,000; sees Q2 revs $56M-$66M vs. est. $64.3M<\/o:p><\/p>\n

·     <\/span><\/span><\/span>CytomX Therapeutics (CTMX<\/span>)<\/b> announces clinical presentations for CX-072 (Abstract 3005), CX-2009 (Abstract 526) as well as CX-2029 (Abstract 3502) developed in partnership with AbbVie (ABBV), to have data cutoff dates of approximately 5-months later than the abstract data cutoff<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Exelixis (EXEL<\/span>)<\/b> disclosed in an ASCO abstract that CABOMETYX combination with checkpoint inhibitors has now been active in multiple solid tumors<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Immunic, Inc. (IMUX<\/span>)<\/b> shares rise 40%; receives first regulatory approval from German health authority to initiate a phase 2 clinical trial of its selective oral dhodh inhibitor, imu-838<\/o:p><\/p>\n

·     <\/span><\/span><\/span>MacroGenics (MGNX<\/span>)<\/b> shares fall -20% after clinical data from two investigational pipeline molecules MGD013 and MGC018; prelim observations from Phase 1 MGD013 trial demonstrated response in ~40% of late-stage HER-2-positive tumors, compared to low response rates for HER-2-directed agents and checkpoint blockade, reported historically.<\/o:p><\/p>\n

·     <\/span><\/span><\/span>SmileDirectClub (SDC<\/span>)<\/b> 1Q loss\/share 28c vs. est. loss\/share 20c on revs $197Mm vs. est. $209.9Mm, 1Q adj EBITDA loss $67Mm vs. est. loss $48.7Mm; says in debt pact with investment partners, to have about $420Mm cash<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Steris (STE<\/span>)<\/b> Q4 adj EPS $1.64 on revs $823M (up 7.1% YoY) vs. est. $1.58 and $799.75M; not providing guidance for fiscal 2021<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Tracon Pharmaceuticals (TCON<\/span>)<\/b> Q1 EPS loss (78c) vs. est. loss ($1.09); Q1 cash and cash equivalents were $14.1M at March 31, compared to $16.4M at December 31, 2019 and expects current cash and cash equivalents to fund operations into Q1 of 2021; expects Envasarc final clinical trial data in 2022, & provided drug is approved by FDA in 2023<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Ultragenyx (RARE<\/span>)<\/b> announces positive longer-term results from first three cohorts of phase 1\/2 study of dtx301 gene therapy in ornithine transcarbamylase (otc) deficiency; all three patients in cohort 3 now confirmed responders<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Axcella (AXLA<\/span>)<\/b> 11M share Secondary priced at $4.75<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Kiniksa (KNSA<\/span>)<\/b> 2.4M share Spot Secondary priced at $18.25<\/o:p><\/p>\n

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Technology, Media & Telecom<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Cisco Systems (CSCO<\/span>)<\/b> Q3 EPS 79c\/$11.98 billion (-7.5% YoY) vs. est. 69c\/$11.70 billion; 3Q adjusted gross margin 66.6% vs. 64.6% YoY; guides Q4 revs down 8.5%-11.5% vs. est. down (-11.9%) and EPS 72c-74c vs. est. 69c<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Virtusa (VRTU<\/span>)<\/b> Q4 adjusted EPS 41c on revs $329.7M vs. est. 56c\/$329.6M; says has $300.6M in Cash as of March 31; sees 2021 impacted by Covid-19; remains confident of achieving long-term objectives of greater than industry revenue growth and EPS growth greater than the top-line<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Nvidia Corp. (NVDA<\/span>)<\/b> launched its newest line of chips Thursday, detailing artificial-intelligence capabilities up to 20 times greater than previous products, and the new offerings are already working to fight the COVID-19 pandemic.<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Ping Identity (PING<\/span>)<\/b> 8.5M share Secondary priced at $24.00<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Intelsat SA (I<\/span>)<\/b> shares fall -42% after filing for bankruptcy protection after falling short of the cash it needed to make airwaves available to be sold to wireless operators in a coming government auction; company weighed down by roughly $14.5 billion in debt<\/p>\n<\/div>\n

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