Aviate US Summary

The authors of the content on this page from Sept 2012 to June 2017 are:
Market Commentaries: Gary Paulin, Ameet Patel, Paul Moran, Douglas Morton, Oliver Sherman, Ben Brownette, Rob Arnott, James Santo, Neil Campling
Research: Ameet Patel, Paul Moran, Douglas Morton, Oliver Sherman, Rob Arnott, Neil Campling

S&P -1.12% (1979.3), D -0.64% (16964.1), N -0.88% (4265.5), CL1 -4.51% (36.19), Copper -2.91% (221.70), Gold -0.47% (1261.45) 10YrYld -0.08 (1.8305), DXY +0.13% (97.19), Vix +7.38% (18.63).

The S&P closed down 30bps from the European close steadily sliding over the last 2 hours from session highs to close on the lows. Volumes off 7% today to 8.4bln shares below avg of 8.8bln. Dollars traded off 4% to $270bln, $25bln below est. About 85% of volume printing to the downside.

Unwind of the unwind? Disappointing China trade pulls the plug on the “biggest short squeeze ever”. Most Short -4% vs Eminis -1% (session lows). DXY testing 200dma intraday. Rates weak globally, 10yr +1.82% falls the most in 3 weeks, new lows 2/10 and Banks weaker in sympathy; BKX -2.5% back below 50dma. Oil falls nearly 5% from early high, API 4:30pm. CHEVRON -2% putting projects on hold to protect divs, announced further spending cuts at today’s analyst meeting. Copper/Gold proxies also lag; Goldman -ve. XME -7.5% / GDX -4.8%. US STEEL -9%, FREEPORT -12%, CLIFF NAT -21%. Raising capital just got a little trickier, Saipem looks to have gone terribly. On Earnings; URBAN OUTFITTERS +16% (tops S&P, big short cover on no warning), DICKS SPORTING +50bps (decent bounce intraday but guide weak), SHAKE SHACK -12% (strong comps but no change to guidance, valuation), NAVISTAR -12% (losing market share, weak guide). Not a huge amount of news outside the obvious; market happy to hide in Telco with AT&T -10b[s (Technical Buy) & VERIZON +50bps making new highs. Staples Index (S5CONS) also making new highs; CLOROX +1.6% (QCC). Yesterday’s weakness in large cap tech being bought today, what you would expect; MICROSOFT +1.2% (QCC), FACEBOOK +20bps (Buy). Biotech reversing yesterday rally and Airlines trade poorly on JET BLUE -9% warning. We revisit our Sell in APPLE -80bps following another guidance cut from Dialog Semi and China data, a reminder of another tough earnings season for the supply chain next month; SKYWORKS -4%. Now add this into the mix….ZTE US ban story gathering pace, Iran sanction dodging, 4th largest player in US smartphone market; OCLARO -15% the first supplier to warn…..does raise the question “is this the beginning of a US-Sino trade war?”. China is Apple’s 2nd biggest market and where all their growth comes from. Worth keeping on the radar.

OUTPERFORMERS: Utils +80bps, Staple +30bps, Telco +10bps, Defense -20bps, Software -30bps

UNDERPERFORMERS: Materials -7.5%, Drillers -7.5%, Oil Services -6.1%, Gold Miners -4.8%, Biotech -3.6%

COMMODS: OJ +2.5%, Nat Gas +1.5%, Sugar +1.4%, Gold unch, Silver -1.3%, Ally -2.1%, Copper -2.9%, WTI -3.7%, Nickel -8.5%

ECO: NFIB Small Biz 92.9, est 94.0

AFTER-HRS NEWS/MOVES:

AMPLIFY SNACK BRANDS +9.8% q4 beats, fy view better than est
BLUE BUFFALO +9.4% q4 eps/revs beat
ACTIVE TODAY:

TMT
BITAUTO HLDGS +4.9% q4 epads beats, q1 revs seen better than est
QUALCOMM -1.6% boosts dividend 10%
JOHN WILEY & SONS -60bps q3 eps misses

CONSUMER
JETBLUE -9.1% q1 prelim rasm down 7-8%
TAYLOR MORRISON -1.5% u/g @ Credit Suisse
PANERA BREAD -2% u/g @ Morgan Stanley
BOSTON BEER -12.2% d/g @ Credit Suisse
CASEY’S GENERAL STORES +2.2% q3 eps beats, revs small miss
TOWN SPORTS +59% q4 revs fall 8% but posts profit, positive membership stats
PERRY ELLIS -8.7% q4 eps/revs miss, fy view below est
UBRAN OUTFITTERS +16.1% q4 beats street
SHAKE SHACK -11.8% q4 eps/revs just beat, only reits outlook
STARWOOD -1.7% d/g to sell @ Argus
DICK’S SPORTING GOODS +50bps q4 eps/revs/comps miss, guidance below est
UNITED CONTINENTAL -2.2% sees q1 prasm down 6-8%, shareholders going activist, nominating board members
AMERICAN AIRLINES -3.2% Feb traffic up 4.7%
DELTA AIRLINES -4.5% sees q1 prasem down 2-4.5%
KROGER -10bps positive comments @ BofA/Merrill
UNITED NATURAL FOODS +7% q2 eps beats

MATERIALS
ANGLOGOLD -3.7% d/g @ RBC
STEEL DYNAMICS -1.7% u/g @ Berenberg
LUMBER LIQUIDATORS -15% Whitney Tilson re-inits short

FINANCIALS
BANK OF MONTREAL -5bps d/g @ Credit Suisse
BANCO SANTANDER +70bps u/g to conviction buy @ Goldman
FIFTH THIRD -2.4% u/g @ Stephens

HEALTHCARE
BIOMARIN -3% u/g @ Baird

CAPITAL GOODS
NAVISTAR -12% q1 adj ebitda beats, revs miss, brings down high end of fy adj ebitda guide
VIVINT SOLAR -20% terminates merger agreement w/ SUNEDISON +5.3%
RENESOLA -70bps q4 beats est
JOY GLOBAL -7.2% p/t raised @ BMO Capital

ENERGY
MATADOR RESOURCES -8.3% prices 7.5mm share secondary

TRANSPORTATION
FEDEX -1.8% p/t increased @ BofA/Merrill

Have a good evening.