Northern Trust Securities: 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 +1.37% (2076.1), D +1.22% (17706.1), N +2.05% (4444.3), CL1 +2.29% (47.75), Copper +0.49% (206.50), Gold -1.77% (1226.96) 10YrYld +0.03 (1.8629), DXY +0.38% (95.59), Vix -8.85% (14.42).

The S&P closed up 15bps from the European close to end the day in the middle of the narrow afternoon range losing just 15bps off the highs of the day over the last half hour. Volumes much stronger after yesterday’s very quiet session, up 16% today to 6.9bln shares but still below 20day avg of 7.2bln. Dollars traded up more than 20% to $248bln, about 5% below avg still. 3:1 up volume over down volume on the day.

The US takes a positive handover and runs with it to post the best day on the S&P in 2 and a half months. Risk-on everywhere you look with a number of moves getting positive technical attention, downtrends being challenged to the upside. SPX, having been treading water around the 50 day avg, still trying to make a break for it for good, now above the avg for the 2nd time in just over a week. Small-caps solidly outperforming up well over 2% trying once again for a decisive move here above on-going downtrend vs the S&P. Unlike prev up days, short-covering not the primary driver w/ the most shorted actually underperforming most of the day before shorts threw in the towel mid-afternoon. Large-cap led by semis, financials. With respect to the latter, 10yr yields >1.86% to a new high for the move as June hike probabilities also at highs, 34% (>50% by July mtg). With rates up, the Dollar Index making a new high for the move also to its best level since the end of March while gold down over 1.5% w/ a strong move through its 50 day w/o a lot of obvious support below here. Crude no doubt part of the overall upside momentum today up 1.5%, yet another asset class making highs for the move, now inline w/ early October prices, +86% from mid-Feb lows; we still make a case for higher prices from here. In stocks, home-builders get a lift on #s from TOLL BROS +8.7% and better than expected new home sales data. One of many sectors looking poised to reverse recent fortunes. LENNAR (NTS Buy) +3.9% & HOME DEPOT +1.5% / LOWES +95bps (both QCC) our names to play a steady recover (“you fix housing…”). In retail XRT +80bps lags the overall tape weighed down in part on #s from DSW -11.6% and BEST BUY -7.5% continuing more bad news than good news from consumers. MONSANTO +3.1% rejects Bayer but still willing to talk about higher prices. Interesting to note two announcements in ridesharing today: Volkswagen w/ $300mm investment in Gett, Toyota w/ a memo of understanding to work with Uber. While a captive market for vehicles def part of it, access to technology/innovation just as much part of the bigger picture: autonomous vehicles anyone? Plays well for NVIDIA (NTS Buy) +2.4%

OUTPERFORMERS: Homebuilders +4.3%, Coal +3.6%, Semis +2.6%, Software +2.2%, Asset Mgrs +2.2%

UNDERPERFORMERS: Gold Miners -6.1%, Metals/Mining -2.4%, Railroads -75bps, Dept Stores -40bps, Oil Services +5bps

COMMODS: Cotton +2.5%, Crude +1.5%, Heating Oil +1.3%, Gasoline +60bps, Copper +50bps……NatGas -3.2%, Nickel -2%, Gold -1.9%, OJ -1.5%, Sugar -1.1%

ECON: Richmond Fed Manf Index -1 vs +8 est, New Home Sales 619k vs 523k est, m/m +16.6^ vs 2.4% est

AFTER-HRS NEWS/MOVES:

HEWLETT-PACKARD ENTERPRISES +8.9% to spin off services biz, merge w/ COMPUTER SCIENCES CORP +19.9%
INTUIT -1.7% q3 beat, raises fy view
NIMBLE STORAGE +8.8% q1 revs beat, sees q2 revs better

ACTIVE TODAY:

TMT
SONY +6% profit outlook miss but optimism on future prods
VMWARE +1.2% d/g @ Cowen
MICROSOFT +3.1% u/g @ Cowen
WESTERN DIGITAL +4.5% u/g @ Cowen, p/t cut @ Jefferies
NOKIA +2.7% reports of possible job cuts per press
SQUARE +7.2% u/g @ BTIG
TWITTER -2.6% d/g to sell @ MoffettNathonson
XILINX +5.7% t/o talk per industry blog

CONSUMER
BEST BUY -7.4% q1 beat but q2 seen below est, CFO/CAO to step down
GENESCO -3.9% d/g @ Piper Jaffray
TOLL BROS +8.7% q2 beat
GENERAL MILLS -50bps d/g to sell @ Goldman Sachs
DSW -11.6% q1 miss, cuts forecast
BOB EVANS -4.1% block trade prints
TESLA +80bps negative report @ Devonshire Research
UNDER ARMOUR +2.6% inks record deal to sponsor UCLA college teams
HERBALIFE +4.3% renewed talk of FTC settlement

HEALTHCARE
ANTHEM -3.5% d/g @ Sterne Agee CRT
QIAGEN -2% gets FDA warning letter

CAPITAL GOODS
JOHNSON CONTROLS +2.7% u/g @ Credit Suisse
DEERE +2.3% u/g @ BMO Capital
NORDSON +15% #s beat

MATERIALS
ARCHER DANIELS MIDLAND +4% u/g @ BMO
CF INDUSTRIES -7.5% d/g @ BofA/Merrill
MONSANTO +3.1% sees Bayer offer inadequate but still open to talks

SERVICES
BOOZ ALLEN HAMILTON -2.1% secondary for p/e hldr​

TRANSPORTS
SEASPAN -9.2% secondary