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 -0.47% (1994.2), D -0.92% (16924.8), N -0.14% (4346.9), CL1 -0.17% (46.58), Copper +1.28% (241.80), Gold +1.64% (1188.23) 10YrYld -0.07 (1.9788), DXY -0.85% (93.96), Vix +1.87% (18.00).

The S&P closed flat with the European close, steadily moving into negative territory from flat over the last three hours. Volume continued to climb for the 2nd straight day up 10% to 6.8bln vs 7.5bln avg. Dollars traded up in similar proportion to $265bln, $35bln below avg. Very slight lean to negative volume over positive volume on the day.

Markets lower, lots of interesting talking points, good mix of misses/warnings already. Disappointing Retail Sales adding further pressure to DXY/Rates; EUR 1.1483, JPY 118.75. 10yr 1.98, KRE -3% breaks 200dma. Beige book shows continued modest expansion but there’s no inflation. Next FOMC 27/28th. Oil lagging commods, tests $46 in early trade; Russian and Mexico have no plans to cut production. On Earnings; LINEAR TECH +6.2%, INTEL +2.4%, BAML +80bps, WELLS FARGO -70bps, CSX -1.9%, JP MORGAN -2.5%, COLFAX -10%. M&A driving Semis higher; SANDISK +11% and FAIRCHILD +16% put themselves in the shop window; ANALOG DEVICES +9% and MAXIM +10% said to be in merger talks. Can’t be good for ASML -5bps, who missed today. Earnings in the space mixed; LINEAR TECH talked up Autos/China on their call, INTEL +2.4% recovered from early weakness but earnings were disappointing. We continue to favor ARM +3%. Looks like APPLE -1.4% was funding a lot of these Semi purchases. Further support to our eGaming theme; Vivendi taking stake in Ubisoft; another new high ACTIVISION, to host ID 11/6. Banks earnings mixed; BAML solid but market not so impressed with JPM and WELLS FARGO, not a huge amount to get excited about. C/GS report tomorrow. CSX put up low quality beat, we remain cautious on the Rails; remain a Seller UNION PACIFIC -1%. WALMART +10% fallen off a cliff, big cut to growth targets, growing investment and wage costs; and of course AMAZON -70bps. New 52 week lows GAP $ MACY’S -1%. Homebuilders weak throughout the session, S15HOME breaks 200dma; Mortgage Apps -27.6% following new disclosure rules. NIKE (unch) talked up growth at their investor day, see $50bn in Revs by 2020, nearly 10% above the street.

OUTPERFORMERS: Gold Miners +6.5%, SOX +3.8%, Solar +3.8%, Drillers +2%, Oil Services +1.6%

UNDERPERFORMERS: Food & Staples -3.7%, Homebuilders -3.1%, Regional Banks -2.8%, Defense -2.1%, Managed HC -1.6%

ECO: Mortgage Apps -27.6%. Retail Sales MoM +0.1%, est +0.2%. PPI MoM -0.5%, est -0.2%; YoY -1.1%, est -0.8%.

COMMODS: OJ +5%, Gold +1.9%, Silver +1.6%, Copper +1.3%, Nat Gas +1.2%, WTI -10bps, Corn -1.6%, Wheat -2.2%

AFTER-HRS NEWS/MOVES:

NETFLIX -6% q3 7c inline, revs $1.58bln vs 1.75 est, sees q4 2c vs 4c est, sees q4 revs $1.67bln vs 1.86 est, sees q4 domestic adds 1.65mm vs 1.73 est/int’l 3.5mm vs 3.17 est
JARDEN -2.1% prelim q3 revs $2.2bln vs 2.25 est
XILINX +1% q2 48c vs 46c est, revs $527.6mm vs 527.5 est

ACTIVE TODAY:

TMT
INTEL +2.4% q3 64c vs 59c est, revs $14.5bln vs 14.24 est
SANDISK +11.2% said to be exploring sale per press, MICRON +3.5%, WESTERN DIGITAL -1.4% usual suspects
ASML -5bps q3 EUR 0.75 inline, revs EUR 1.55bln vs 1.56 est, sees q4 revs EUR 1.4bln vs 1.57 est
LINEAR TECHNOLOGY +6.2% q1 46c inline, revs $341.9mm vs 343.3 est
DISCOVERY -1.7% d/g @ Macquarie
GOPRO +40bps d/g @ Piper
ADOBE +20bps u/g @ Atlantic
ORACLE -1.5% d/g @ JMP Securities
TWITTER +1.1% d/g @ JMP Securities
PAYPAL +2.5% franchise pick @ Jefferies
HOMEAWAY +1.3% positive comments @ Piper
APPLE -1.4% view cut to mixed from positive @ OTR Global
TRIPADVISOR +25.5% booking partnership with PRICELINE -2.5%
MICRON +3.5% Asian press article discusses possible semi alliance
FAIRCHILD +15.6% said hire advisors on interest possibly from Infineon and ON SEMI +7.1%
ELECTRONIC ARTS +3.1% u/g @ MKM Partners
ANALOG DEVICES +8.8% / MAXIM +10.4% said to be in talks

HEALTHCARE
CEPHID -21.6% prelim q3 (13c) vs (5c) est, revs $126.5mm vs 127.88 est
BIOMARIN +4.5% gets FDA panel date pressuring SAREPTA -11.8%

CONSUMER
DELTA AIRLINES +1.8% q3 $1.74 vs 1.71 est, revs $11.11bln vs 11.10 est
UNDER ARMOUR -4% d/g @ Piper; p/t raised @ Canaccord
VF CORP -5bps u/g @ Piper
BLACKHAWK NETWORK -10% q3 35c vs 30c est, revs $193.4mm vs 196.9 est
JARDEN +80bps $1.5bln acq
TIFFANY +5bps reit o/p @ Bernstein
CHIPOTLE MEXICAN GRILL -4.3% view cut to mixed from positive @ OTR Research
MCDONALD’S -50bps u/g @ Cleveland Research
WALMART -10% surprise guidance cut at investor day

FINANCIALS/REAL ESTATE
JP MORGAN -2.5% q3 $1.32 vs $1.38 est, revs $22.8bln vs 24.04 est
BANK OF AMERICA +80bps q3 37c vs 33c est, revs $20.91bln vs 20.67 est
BLACKROCK +2.3% q3 $5.00 vs 4.55 est, revs @2.91bln vs 2.80 est
PNC -2.7% q3 $1.90 vs 1.78 est, revs $3.78bln vs 3.80 est
WELLS FARGO -70bps q3 $1.05 inline, revs $21.88bln vs 21.78 est

CAPITAL GOODS
COLFAX -9.8% q3 24c vs 41c est, revs $969.1mm vs 992.8 est, sees fy revs $3.9-3.95bln vs 4.035-4.11 prior view
BOEING -4.3% Delta CEO invokes “bubble” talk and cancels an order

ENERGY
ENCANA +3.7% u/g @ Deutsche
WHITING PETROLEUM +2.2% d/g @ Deutsche
ROYAL DUTCH SHELL +2.2% u/g @ Argus

TRANSPORTATION
CSX -1.9% q3 52c vs 50c est
JB HUNT +3.3% q3 99c vs 98c est, revs $1.59bln vs 1.62 est

MATERIALS
STILLWATER MINING -2.4% d/g @ CIBC

Have a good evening.