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 +0.70% (2090.5), D +0.82% (17851.5), N +0.72% (4476.4), CL1 +2.30% (49.74), Copper +1.77% (210.30), Gold -0.02% (1224.18) 10YrYld +0.00 (1.8664), DXY -0.16% (95.42), Vix -3.61% (13.90).

The S&P closed up 10bps from the European close, like yesterday holding gains in a narrow rage through the afternoon w/ only a small move off the day’s highs in the last half hour.  Volume flat w/ yesterday at 6.9bln shares, still trailing a touch below avg of 7.3bln.  Dollars traded off small today to $250bln, $12bln below est.  About 80% of volume printing to the upside.

Few in a better mood this week it would seem than Fed Chair Yellen with the market taking kindly to the Fed’s inclination to raise this summer.  We can confirm if indeed the case at her appearance at Harvard on Friday afternoon.  Rates continuing to inch ever higher w/ the 10yr above 1.87% for the first time since the beginning of the month (though the dollar just lower on the day), Gold lower 6th straight day.  Banks at their best level since the early January w/ the KBW Bank Index up 20% since February lows.  Crude continuing its ascent as well up more than 2% to yet another new high for the move, best prices since July last summer.  Joining Banks & Energy, Autos & Materials also strong (Copper +1.7%).  Bears sounding fairly nitpicky this week but would point to today’s outperformance of shorts (most-shrtd +1.2%) and underperformance of small caps (+60bps) as signs that incremental risk capital has largely been deployed, also volume still bumping up against just avg levels.  Nonetheless we sit about 2% below all-time highs 1yr removed from that level as the TIME Index (Tech, Industrial, Materials, Energy) outperforms SHUT (Staples, Healthcare, Utes, Telecom) for 6 of last 8 sessions at at best relative level in a month: a positive for generally higher equity prices.  In single-stocks today, HPE +6.8% on good #s and a plan to spin-off its services business in combination with COMPUTER SCIENCES +42%: positive signs in the industry for COGNIZANT -50bps (NTS Buy) as well as opening the door for some opportunistic gains.  An eye still on retail as XRT +1.2% beats the mkt today on strength in recently beaten-down names.  That said another mall-exposed retailer EXPRESS -8.4% reported disappointing numbers today as did TIFFANY (NTS Sell)  +5bps which cannot offer yet offer investors any visibility.  Also in the news ALIBABA -6.9% on an accounting investigation, MONSANTO +2.1% though questions surround Bayer’s ability/willingness to improve their bid meaningfully.  Tomorrow Durable Goods, Cap Goods #s (along w/ Pending Home Sales) in focus with the June Fed mtg top of mind.

OUTPERFORMERS: Coal +5.7%, Drillers +5.3%, Metals/Mining +4.9%, Oil Services +3.8%, Steel +2.6%

UNDERPERFOMERS: Consumer Services -35bps, Utes -30bps, Refiners -20bps, Consumer Durables/Apparel -20bps, Homebuilders unch’d

COMMODS: Sugar +3.3%, Soybeans +2.9%, Crude +2.2%, Corn +1.8%, Copper +1.8%…..Cocoa -1%, Gasoline -60bps, Gold -40bps, NatGas -50bps, Coffee -30bps

ECON: MBA Mortgage Applications 2.3%, FHFA House Price Index +0.7% m/m vs 0.5% est, Markit US Services PMI 51.2 vs 53 est/Composite PMI 50.8

AFTER-HRS NEWS/MOVES:

LIONSGATE +14.6% q4 beat
NETAPP -8.3% q4 miss, lowers q1 view
INFOBLOX -3.4% q3 loss, sees q4 at or below est
GUESS -90bps q2 miss, cuts fy view
HP INC +80bps q2 beat, tweaks high end of fy view lower
POPEYES LOUISIANA KITCHEN -6% q1 miss
PVH CORP +6.6% q1 eps beat, boosts fy view
WILLIAMS-SONOMA +3.6% q1 beats, reaffirms

ACTIVE TODAY:

TMT
HEWLETT-PACKARD ENTERPRISES +6.8% #s beat, spinning off services biz which will merge w/ COMPUTER SERVICES CORP +42.1%
INTUIT -2.1% q3 beats but concerns on QuickBooks growth
NIMBLE STORAGE +16.5% q1 revs beat, q2 sales seen >est
WORKDAY +1.1% p/t raised @ Citi
NOKIA +4.1% u/g @ CLSA
CRITEO -2.3% Facebook said to shut ad exchange
ALIBABA -6.9% reports of accounting investigation

CONSUMER
JACK IN THE BOX +5.3% investor day
TIFFANY +5bps q1 comps miss, cuts forecast
PILGRIM’S PRIDE -2% sued by gov’t for hiring discrimination, d/g @ BB&T
GUESS +1.2% u/g @ Standpoint
STARBUCKS -50bps cautious comments @ ITG
MONSTER BEVERAGE -40bps added to focus list @ RBC
TESLA +80bps delivery est lowered @ RBC
MICHAEL KORS +60bps p/t cut @ Credit Suisse
EXPRESS -8.4% q1 miss, sees q2 below est

HEALTHCARE
AGILENT +90bps q2 beats
SAREPTA +26.6% FDA extends review
ALNYLAM PHARMA +9.9% m&a reviving, possible competitor drug setback

FINANCIALS
ARTHUR J GALLAGHER unch’d: to be added to S&P 500 Fri night

CAPITAL GOODS
VIASAT -4.5% q4 miss

INDUSTRIAL
DYCOM INDUSTRIES +13.5% q3 beat

SERVICES
DEVRY -13% CEO change

MATERIALS
MONSANTO +2.2% mkt talk Bayer reluctant to improve bid for co.

UTILITIES
DYNEGY -4.8% weak capacity auction