{"id":12836,"date":"2020-06-15T09:49:06","date_gmt":"2020-06-15T14:49:06","guid":{"rendered":"https:\/\/www.eoption.com\/2020\/06\/15\/mid-morning-look-june-15-2020\/"},"modified":"2020-06-15T09:49:06","modified_gmt":"2020-06-15T14:49:06","slug":"mid-morning-look-june-15-2020","status":"publish","type":"post","link":"https:\/\/www.eoption.com\/mid-morning-look-june-15-2020\/","title":{"rendered":"Mid-Morning Look: June 15, 2020"},"content":{"rendered":"
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Mid-Morning Look<\/o:p><\/span><\/b><\/p>\n

Monday, June 15, 2020<\/span><\/b><\/o:p><\/span><\/b><\/p>\n\n\n\n\n\n\n\n\n
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Index<\/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

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 <\/o:p><\/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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-540.98<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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2.11%<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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25,064<\/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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-38.23<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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1.26%<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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3,003<\/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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-61.62<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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0.66%<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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9,525<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n<\/tr>\n

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Russell 2000<\/span><\/b><\/o:p><\/span><\/p>\n<\/td>\n

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-19.31<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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1.39%<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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1,368<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n<\/tr>\n

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U.S. equities are adding to last week losses, but are well off morning lows, amid concern over a second wave of the coronavirus after China’s Beijing reported a new spike of cases tied to a meat and vegetable market that forced the city to enact strict lockdown measures. China reported 49 new confirmed coronavirus cases, its highest daily total of coronavirus cases in two months. Meanwhile, in the U.S., several states including Arizona, Florida and Texas have reported increased numbers of cases in the past week. NY<\/span> Governor Cuomo also threatened to reverse the reopening in parts of the state that are not enforcing or following virus safety rules, while NJ<\/span> reopened outdoor dining today. Stocks are also dealing with lingering concerns over economic growth after the FOMC’s glum outlook last week. Stocks are coming off their worst week since late March, led by weakness in energy as oil falls, airlines and leisure names while consumer staples and “stay-at-home” related names (software, video games, and video conferencing) are seeing a bounce early. In a positive, data from China showed economic activity improving in May but retail sales fell 2.8% in May from a year earlier. In politics, reports this weekend that President Trump wants at least $2T for next coronavirus relief package, nearly double the ~$1T price tag sought by McConnell but less than the >$3T being pushed by Dems while White House economic advisor Kudlow said the U.S. needs to end $600-per-week of extra unemployment benefits and replace it with smaller bonus for workers who return to their jobs. <\/o:p><\/p>\n

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Economic Data<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Empire Manufacturing for June strong<\/b> as reported at down (-0.2) vs. est. (-29.6) and last month was down (-48.5) – Empire State new orders index -0.6 in June vs -42.4 in May, prices paid index +16.9 in June vs. +4.1 in May, employment index at -3.5 in June vs. -6.1 in May and the six-month business conditions index +56.5 in June vs. +29.1 in May<\/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

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 <\/o:p><\/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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-1.19<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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35.07<\/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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-0.70<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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38.03<\/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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-19.60<\/span><\/o:p><\/span><\/b><\/p>\n<\/td>\n

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1,717.70<\/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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0.0015<\/o:p><\/span><\/p>\n<\/td>\n

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1.1271<\/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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-0.03<\/o:p><\/span><\/p>\n<\/td>\n

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107.36<\/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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-0.027<\/o:p><\/span><\/p>\n<\/td>\n

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0.675%<\/o:p><\/span><\/p>\n<\/td>\n<\/tr>\n

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Sector Movers Today<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Transports; in airlines, UAL<\/span><\/b> said it lined up a $5B loan backed by the carrier’s loyalty program and expects to have total available liquidity of approximately $17B at the end of Q3\/also entered an equity distribution agreement for up to 28M shares with Citi, BofA and JPMorgan; in trucking, WERN<\/span><\/b> was upgraded to buy from neutral at UBS saying it has shown strong execution and it provides exposure to the anticipated up cycle in TL pricing in 2021; the Baltic dry index, which tracks rates for ships ferrying dry bulk commodities and reflects rates for capesize, panamax and supramax vessels, rose 50 points, or about 5.4%, to 973, its highest since Jan. 2, as the Baltic capesize index jumped 125 points, or about 8.2% to 1,648, its highest since Dec. 24 (shares of SALT<\/span>, GOOGL<\/span>, SB<\/span>, SBLK<\/span>, DSX<\/span><\/b> among names leveraged to the data)<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Consumer finance and lending; SYF<\/span><\/b> May net charge-off rate 4.17% vs. 4.61% last month and reports May 30-plus day delinquencies 2.20% vs. 2.47% last month; COF <\/span><\/b>May net charge-offs 4.49% vs. 4.93% last month and reports May 30-plus day performing delinquencies 3.15% vs. 3.58% last month; ADS<\/span><\/b> May net charge offs 8.0% vs. 7.3% last month and reports May delinquency ratio 4.8% vs. 5.6% last month; JPM<\/span><\/b> May net charge-offs 2.34% vs. 2.46% YoY and May delinquencies 1.2% vs. 1.14% YoY<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Energy stocks weak initially as oil prices fall on fears that new coronavirus cases could threaten fuel demand recovery outlook. WTI crude futures slid below $35 a barrel following a fresh coronavirus outbreak in China and increased cases elsewhere which spurred concerns that a second wave of the virus will derail a nascent economic recovery; BP<\/span><\/b> said it will take an estimated $13B-$17.5B in impairments and write-downs in the second quarter after revising its long-term price assumptions; APA<\/span><\/b> was upgraded to Buy and raise target price to $18 at Citigroup which reflects a ~5.8x multiple on our 2021 DACF, a slight premium to our group coverage average, but well below HES<\/span><\/b> ~10x; XOG<\/span><\/b> files for Chapter 11 bankruptcy protection<\/o:p><\/p>\n

·     <\/span><\/span><\/span>Pharma movers; AZN <\/span><\/b>has reached an agreement with Europe’s Inclusive Vaccines Alliance, or IVA, spearheaded by Germany, France, Italy and the Netherlands, to supply up to 400M doses of the University of Oxford’s COVID-19 vaccine, with deliveries starting by the end of 2020; LLY <\/span><\/b>said enrollment is underway in a Phase 3 clinical trial, COV-BARRIER, evaluating its Olumiant (baricitinib), an oral JAK1\/JAK2 inhibitor licensed from INCY<\/span><\/b>, in hospitalized COVID-19 patients; BYSI<\/span><\/b> announces positive topline interim results from protective-2 (study 106) phase 3 trial evaluating superiority of Plinabulin in combination with Neulasta for chemotherapy-induced neutropenia prevention as met primary and secondary endpoints<\/o:p><\/p>\n

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Stock GAINERS<\/o:p><\/span><\/p>\n

·     <\/span><\/span><\/span>BYSI<\/span><\/b> +14%; announces positive topline interim results from protective-2 (study 106) phase 3 trial evaluating superiority of Plinabulin in combination with Neulasta for chemotherapy-induced neutropenia prevention as met primary and secondary endpoints<\/o:p><\/p>\n

·     <\/span><\/span><\/span>CTLT <\/span><\/b>+1%; after signing a deal with AZN<\/span><\/b> to provide vial filling and packaging capacity at its manufacturing facility in Italy as prepares for supplying hundreds of millions of doses for COVID<\/o:p><\/p>\n

·     <\/span><\/span><\/span>DOCU<\/span><\/b> +3%; beneficiary of stay at home names as coronavirus cases edging higher again while also announced will replace UAL in the Nasdaq 100 index<\/o:p><\/p>\n

·     <\/span><\/span><\/span>EA <\/span><\/b>+3%; seeing strength again in “stay-at-home” type beneficiaries on fears of rising cases and people possibly forced to stay home again (ATVI<\/span>, ZM<\/span>, TTWO<\/span><\/b> higher)<\/o:p><\/p>\n

·     <\/span><\/span><\/span>IRBT<\/span><\/b> +10%; boosted its Q2 revenue forecast to $260M-$270M from as had previously expected it to be down modestly from 1Q’s $193M aided to a lesser extent by better-than-planned gross margin and diligent expense management<\/o:p><\/p>\n

·     <\/span><\/span><\/span>SHOP<\/span><\/b> +6%; said is joining forces with WMT<\/span><\/b> to open Walmart Marketplace to SHOP’s sellers, integrating new sellers and expects to add 1,200 SHOP sellers this year (shares were also upgraded to overweight and tgt raised to $843 from $733 at Piper<\/o:p><\/p>\n

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Stock LAGGARDS<\/o:p><\/span><\/p>\n

·     <\/span><\/span><\/span>ADS <\/span><\/b>-7%; May net charge offs 8.0% vs. 7.3% last month and reports May delinquency ratio 4.8% vs. 5.6% last month and pullback in credit card related names<\/o:p><\/p>\n

·     <\/span><\/span><\/span>DAL<\/span><\/b> -4%; airlines another sector pressured amid rising COVID cases<\/o:p><\/p>\n

·     <\/span><\/span><\/span>NBL<\/span><\/b> -6%; as energy stocks drop across the board with pullback in oil prices<\/o:p><\/p>\n

·     <\/span><\/span><\/span>NCLH <\/span><\/b>-8%; cruise industry falling on renewed rising coronavirus cases <\/o:p><\/p>\n

·     <\/span><\/span><\/span>SLG<\/span><\/b> -6%; as retail, mall and strip related REITS slide on fears of more cases slowing economy and stores slowing the pace of reopenings<\/p>\n<\/div>\n

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