{"id":12726,"date":"2020-05-20T06:03:43","date_gmt":"2020-05-20T11:03:43","guid":{"rendered":"https:\/\/www.eoption.com\/2020\/05\/20\/morning-preview-may-20-2020\/"},"modified":"2020-05-20T06:03:43","modified_gmt":"2020-05-20T11:03:43","slug":"morning-preview-may-20-2020","status":"publish","type":"post","link":"https:\/\/www.eoption.com\/morning-preview-may-20-2020\/","title":{"rendered":"Morning Preview: May 20, 2020"},"content":{"rendered":"
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Early Look<\/o:p><\/span><\/b><\/p>\n

Wednesday, May 20, 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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283.00<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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1.17%<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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24,441<\/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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32.50<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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

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2,951<\/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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97.50<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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1.05%<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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9,398<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

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Stock futures are pointing to a strong open in the U.S., on track to recover from the late day slide on Tuesday after better earnings results from retailers Target and Lowe’s and as markets await results from the Federal Reserve’s most recent policy meeting, released later this afternoon. U.S. stocks took a sharp downturn late yesterday amid a report from Stat News that offered a more cautious view of a phase I<\/span> result from Moderna Inc.’s (MRNA<\/span>) coronavirus vaccine candidate. Wall Street also digested two hours of congressional testimony from Federal Reserve Chairman Jerome Powell and U.S. Treasury Secretary Steven Mnuchin and parsed earnings reports from major retailers, including Dow components Walmart and Home Depot. The S&P 500 and Nasdaq Composite turned negative in the last hour of trading, while the Dow Jones Industrial Average extended its losses. With Tuesday’s losses, the S&P 500 has recovered 30.6% off its March 23 low, and is now about 13.7% below its record high in February. In Asian markets, The Nikkei Index rose 161 points to 20,595, the Shanghai Index dipped -14 points to 2,883 and the Hang Seng Index gained 11 points to 24.399. In Europe, the German DAX<\/span> is higher by 60 points to 11,140, while the FTSE<\/span> 100 is up about 10 points to hold just above the 6,000 level. Several US<\/span> states have been loosening restrictions on beaches ahead of the Memorial Day holiday, and parts of New York state were entering initial phases of reopening after Gov. Andrew Cuomo said the outbreak is back to where it started before it took off in late March.<\/o:p><\/p>\n

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

·     <\/span><\/span><\/span>The S&P 500 Index<\/b> dropped -30.97 points<\/span>, or 1.05%, to 2,922.94<\/o:p><\/p>\n

·     <\/span><\/span><\/span>The Dow Jones Industrial Average<\/b> fell -390.51 points<\/span>, or 1.59%, to 24,206.86<\/o:p><\/p>\n

·     <\/span><\/span><\/span>The Nasdaq Composite <\/b>slipped -49.72 points<\/span>,<\/span> or 0.54%, to 9,185.10<\/o:p><\/p>\n

·     <\/span><\/span><\/span>The Russell 2000 Index<\/b> declined -25.97 points<\/span>, or 1.95% to 1,307.72<\/o:p><\/p>\n

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

·     <\/span><\/span><\/span>7:00 AM EST      MBA Mortgage Applications Data<\/o:p><\/p>\n

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

·     <\/span><\/span><\/span>2:00 PM EST       FOMC Meeting Minutes from April meeting<\/o:p><\/p>\n

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

·     <\/span><\/span><\/span>Earnings Before the Open: ADI<\/span>, ATEX<\/span>, EV<\/span>, MCK<\/span>, ROLL<\/span>, TGT<\/span>, VER<\/span><\/o:p><\/p>\n

·     <\/span><\/span><\/span>Earnings After the Close: BOOT<\/span>, COHR<\/span>, EXPE<\/span>, HVT<\/span>, NDSN<\/span>, SCVL<\/span>, SKY<\/span>, SNPS<\/span>, TTWO<\/span><\/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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0.19<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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32.15<\/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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0.48<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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35.13<\/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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9.90<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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1,755.50<\/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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0.0017<\/span><\/o:p><\/span><\/p>\n<\/td>\n

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1.094<\/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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-0.04<\/span><\/o:p><\/span><\/p>\n<\/td>\n

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107.67<\/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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+0.008<\/o:p><\/span><\/p>\n<\/td>\n

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0.696%<\/o:p><\/span><\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

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

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

·     <\/span><\/span><\/span>Target Corp. (TGT<\/span>)<\/b> Q1 EPS 59c on sales $19.62B vs. est. 45c and $18.75B; Q1 comp sales rose 10.8% vs. est. 7.5% and vs. 4.8% YoY; Q1 gross margins 25.1% vs. 29.6% YoY; Q1 Ebitda fell -39% YoY to $1.09B but beat the $968.8M est<\/a>. <\/o:p><\/p>\n

·     <\/span><\/span><\/span>Lowe’s (LOW<\/span>)<\/b> Q1 adj. EPS $1.77\/$19.7B vs. est. $1.31\/$18.08B; Q1 comp sales rose 11.2% vs. est. 4% and US comp sales for U.S. home improvement business up 12.3%; suspends share repurchases for remainder of year and withdraws guidance<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Floor & Decor (FND<\/span>)<\/b> 4.97M share Spot Secondary priced at $45.00<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Urban Outfitters (URBN<\/span>)<\/b> said Q1 total Company net sales decreased -31.9% YoY to $588 million; comparable Retail segment net sales decreased -28%, driven by negative retail store sales due to mandated store closures, partially offset by low double-digit growth in the digital channel. By brand, comparable Retail segment net sales decreased -19% at Free People, -24% at Urban Outfitters and -33% at the Anthropologie Group; Gross margin plunged to 2.0% of sales vs. 26.5% a year ago off the loss of sales leverage (which included an impairment charge)<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Luckin Coffee Inc. (LK<\/span>)<\/b> will resume trading Wednesday, Nasdaq Inc. said late Tuesday after being halted on April 7th. Luckin Coffee received a delisting notice from the Nasdaq May 15 because of “public interest concerns” related to “fabricated” transactions disclosed by the company in its annual report<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Red Rock Resorts (RRR<\/span>)<\/b> Q1 EPS loss ($2.18) on revs $377.4M, down -16% YoY and 1Q adjusted Ebitda $74.3M, -49% YoY; said 1Q casino operating revenue $356.5M, -16% YoY; suspends quarterly dividend for remainder of 2020<\/o:p><\/p>\n

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

·     <\/span><\/span><\/span>The American Petroleum Institute (API<\/span>)<\/b> reported a draw of -4.84M barrels of crude oil for the week ending May 15, ending a streak of six consecutive builds, while gasoline inventories post a draw of -651K barrels, distillate inventories show a build of 5.08M barrels, and Cushing inventories show a draw of -5.04M barrels.<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Halliburton (HAL<\/span>)<\/b> cuts its quarterly dividend to 4.5c from 18c<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Lockheed Martin (LMT<\/span>)<\/b> said it will slow production of its stealthy F-35 fighter jets at its Texas facility, possibly delaying delivery of between 18 and 24 jets due to a parts shortage as the coronavirus hampers production across the jet’s vast supply chain<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Kinder Morgan (KMI<\/span>)<\/b> plans to restart Units 1 and 3 at its Elba Island LNG export terminal in Georgia this week, Bloomberg reported; the two units were shut as a precaution last week after a fire in a mixed refrigerant compressor of Elba’s Unit 2<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Union Pacific (UNP<\/span>)<\/b> upgraded to Buy at UBS and raise tgt to $181 from $156 as believe a combination of strong current cost takeout actions and attractive leverage to upside when demand improves create an attractive reward to risk profile for UNP stock<\/o:p><\/p>\n

·     <\/span><\/span><\/span>CSX Corp (CSX<\/span>)<\/b> upgraded from Neutral to Buy and raise tgt to $80 from $63 at UBS because they believe CSX will provide strong leverage to a cycle turn and volume growth in 2021 while the company’s cost reduction actions are likely to limit downside risk<\/o:p><\/p>\n

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

·     <\/span><\/span><\/span>New Residential (NRZ<\/span>)<\/b> said it raised $600M through a private senior secured loan agreement<\/o:p><\/p>\n

·     <\/span><\/span><\/span>CoStar Group (CSGP<\/span>)<\/b> files automatic mixed securities shelf; announces $1.25B common stock offering<\/o:p><\/p>\n

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

·     <\/span><\/span><\/span>Becton, Dickinson and Company (BDX<\/span>)<\/b> commences concurrent offerings of $1.5B of common stock and $1.5B of depositary shares, each representing 1\/20 interest in its mandatory convertible preferred stock.<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Bio-Techne Corporation (TECH<\/span>)<\/b> and the Mount Sinai Health System in New York, through its commercial affiliate Kantaro Biosciences LLC announced a partnership to initiate scaled manufacturing and distribution of testing kits based on the Mount Sinai-developed COVID-19 serology test<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Johnson & Johnson Inc. (JNJ<\/span>)<\/b> said it will stop selling talc-based baby powder in North America following a flurry of lawsuits alleging the product causes cancer.<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Medigus (MDGS<\/span>)<\/b> 3.333M share Spot Secondary priced at $1.50<\/o:p><\/p>\n

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

·     <\/span><\/span><\/span>Apple Inc. (AAPL<\/span>)<\/b> and Google (GOOGL<\/span>)<\/b> face scrutiny as France’s antitrust watchdog examines how Silicon Valley has muscled in on digital payments as part of a sweeping probe of the fintech industry – Bloomberg<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Facebook (FB<\/span>)<\/b> will limit offices to 25% occupancy, put people on shifts, and require temperature checks and masks when it reopens workplaces in July<\/o:p><\/p>\n

·     <\/span><\/span><\/span>RealPage (RP<\/span>)<\/b> 5.085M share Secondary priced at $59.00<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Kornit Digital (KRNT<\/span>)<\/b> Q1 EPS loss (22c)\/$26.21M vs. est. loss (9c)\/$26.92M<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Corning Inc. (GLW<\/span>)<\/b> said its CEO will take a 40% cut in base salary, named executive officers’ salaries will be reduced by 30%, while the cash compensation of its non-employee directors will be cut by 40%, Corning said in a regulatory filing. Will also reduce the salaries, from 5% to 30%, for all other salaried employees in the United States through the end of the year<\/p>\n<\/div>\n

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