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 +0.56% (2027.2), D +0.43% (17325.8), N +0.85% (4404.2), CL1 +5.94% (38.50), Copper +1.03% (225.65), Gold +2.42% (1262.20) 10YrYld -0.06 (1.9116), DXY -1.03% (95.64), Vix -10.87% (15.01).

The S&P closed up 50bps from the European close with all of that and then some coming post-Fed. Volumes up a bit with the announcement out of the way, +14% today to 7.5bln shares but still below avg of 8.1bln. Dollars traded up 15% to $270bln back inline w/ avg. Up volume bit less than 3/4 of activity today.

Another very quiet session on the lead up to FOMC; market rallied post statement; lowered interest rate forecasts to 2 from 4 this year, “Caution is appropriate”. Eminis +55bps vs Most Short +1.7%. DXY retesting Feb lows, EUR 1.12, EM FX reversing earlier weakness. No surprise to see Rates lower and Banks fall in sympathy and Utils rally. XLU +1% vs KRE -1.1%. June WIRP fallen from 54% to 39%; High Yield +70bps. Strong argument to say market was already there given last weeks price action; we continue to see yield scarcity deserving a premium and focus on our QCC Basket. Nasdaq outperformed, APPLE +1.35 testing 100dma for 1st time this year. Commods rally on USD weakness; Gold reclaims the uptrend; GDX +6.8%. Oil back above $38 following API/DOE (smaller build) data, also reports Iran willing to open talks. FREEPORT +10%, DEVON +9%, ALCOA +6%. PEABODY -45% adds further pressure on Coal market. ORACLE (QCC) +4% chart starting to look more positive following last night’s earnings, announced $10bn Buyback; management keen to highlight the relative momentum vs WORKDAY (Short) +1.6%, stronger SaaS and PaaS billings growth. New lows SANTANDER CONSUMER -8% as co misses 2nd deadline for filing annual report; SUNE/TERP delaying. TIFFANY (Sell) +40bps remain cautious into Friday’s earnings, Basel world opens with cautious tone. LINKEDIN (Short) -5% weak on downgrade. GRUBHUB (Short) -1.2% continues to roll, UberEATS officially launched today as standalone offering in LA, SF, Chicago and Houston with NYC expected next week; we continue to believe Uber and Amazon will significantly change the landscape in the food and delivery market this year.

OUTPERFORMERS: Gold Miners +6.8%, Materials +5.3%, Explorers +3.5%, Autos +2%, Airlines +2%

UNDERPERFORMERS: Inv Banks -1.5%, Regional Banks -1%, Retail -80bps, Biotech -50bps, Staples +20bps

ECO: Housing Starts MoM +5.2%, est +4.6%. Building Permits MoM -3.1%, est -0.2%. CPI MoM -0.2%, est -0.2%. Industrial Prod -0.5%, est -0.3%. FOMC 2pm.

COMMODS: WTI +6.2%, Coffee +2.8%, Silver +2.5%, Gold +2.4%, Nat Gas +1%, Ally -50bps, OJ -80bps, Wheat -1.3%

AFTER-HRS NEWS/MOVES:

GUESS -12% Sees FY EPS 65-85c, est $1.05
HERMAN MILLER +4.7 q3 eps beats, revs miss, q4 seen above est
JABIL CIRCUIT -8% q2 eps, revs small miss, q3 eps/revs seen below est
US SILICA -2.9% 8mm share offering, proceeds for possible acq
WILLIAMS-SONOMA -4.1% q4 eps/revs just light, q1 seen below est
FEDEX +4% q3 eps, revs beat, brings up low end of fy range
NUANCE Icahn reduces stake by 4.4mm shares in block trade

ACTIVE TODAY:

TMT
ORACLE +3.8% q3 beats, cloud growth a positive
LINKEDIN -5% d/g @ Morgan Stanley, reit o/w @ Piper
CBS +3.5% said to explore sale of radio business
MOBILEYE +9.5% seen as beneficiary of automated braking industry agreement
CHARTER +6% approval of Time Warner Cable deal seen

CONSUMER
CHIPOTLE -50bps sees large q1 loss vs est of small
KELLOGG +70bps u/g from sell @ Goldman
REYNOLDS AMERICAN unch’d d/g off conviction buy @ Goldman
RITE AID +25bps u/g @ Credit Suisse
FOSSIL -4.8% d/g @ Macquarie
ESTEE LAUDER -75bps d/g @ Goldman
GAP -1.5% d/g @ Morgan Stanley
WHIRLPOOL +3.2% positive comments in Barron’s

HEALTHCARE
BAXALTA -20bps placing announced Tues night

FINANCIALS
LEGG MASON +4.9% u/g @ Credit Suisse
SHWSANTANDER CONSUMER -7.7% misses 2nd deadline for delinquent report

MATERIALS
SHERWIN-WILLIAMS +1.5% u/g @ Longbow
BHP BILLITON +4% said to weigh copper, oil deals per press

Have a good evening.