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 -0.96% (2064.5), D -1.21% (17711.1), N -0.93% (4361.0), CL1 +2.98% (45.99), Copper +0.22% (209.70), Gold +0.01% (1277.26) 10YrYld -0.02 (1.7367), DXY -0.48% (93.83), Vix +7.78% (14.69).

The S&P closed down 55bps from the European close to end the day squarely at session lows. Volumes tick higher, up 5% today to 7bln shares, less than 3% below avg. Dollars traded up 2% to $244bln, 5% below avg. About 2/3 of volume printing to the downside.

From the sector that brings you “Black Friday” post-Thanksgiving each year, today’s “Black Wednesday” certainly won’t be forgotten by investors anytime soon. Absolute carnage in the retail/consumer space on earnings misses and a deal blow up for extra measure. MACYS -15.2%, FOSSIL -29.1%, WENDY’S -8.9% all disappointing with results and OFFICE DEPOT -40.4% / STAPLES -18.3% as their deal odyssey comes to an unfortunate end. The damage in retail wide spread: XRT off 4.4% with 30% of its constituents down more than 5% (interesting AMAZON +1.5%, one of only 2 names up in the eft). The negative sentiment spreading too to areas like homebuilders with XHB -2% now given up almost half it’s relative gains vs the mkt since bottoming out in early Feb vs the S&P. Practically overshadowed was a 3.2% move in crude as EIA stockpile data unexpectedly dropped. Boone Pickens out today with a bullish view on oil too. Materials space also strong beyond oil. The dollar’s six day win streak ends with the DXY backing up about half a percent. Yield scarce and getting scarcer after today’s treasury auction: biggest ever % going to indirect bidders, largely foreign driven, and the lowest yield in a 10yr auction in more than 3 years. New high for the move in the S&P High Yield Dividend Aristocrats vs the S&P. The curve flattening to early April lows, financials starting to look a little extended again vs the 2/10yr curve here. Updating ideas: APPLE (NTS SELL) -1% still can’t get going on a fresh round of negative press from Asia on orders, this time focusing on orders associated w/ the upcoming iPhone 7. Apple and it’s supply chain remain sells. We’re seeing the negatives pile up in CISCO (NTS SELL) -1.2% ahead of next week’s earnings: near-term pause citied by NOKIA yest, neg read thru today from HARMONIC on the IP video biz, and recently evidence of mkt-share gains from white label competitors like ARISTA (NTS BUY) -35bps. On the long side, more headlines of defense spending on the rise as the US switches on the European missile shield. A constant in today’s uncertain world, our defense basket continues to make new relative highs. And e-gaming gets a boost from ELECTRONIC ARTS #s. NVIDIA (NTS BUY) +30bps and ACTIVISION (NTS BUY) +2% remain our US plays. Also sometimes it’s what you don’t do: DISNEY down 4% today on broadcast weakness, validates the view of resisting the temptation to get back involved in the name earlier this year, still a muddled space as costs and consumer choice increase and no dominant business model (not even for NETFLIX (NTS SELL) -3.1%).

OUTPERFORMERS: Metals/Mining +6.9%, Coal +3.2%, Gold Miners +2.5%, Explorers +1.2%, Solar +1%

UNERPERFORMERS: Dept Stores -10.4%, Consumer Durables/Apparel -3.7%, Real Estate -2.3%, Consumer Discretionary -2%, Retailers -1.9%

COMMODS: Gasoline +5.8%, Sugar +4.7%, Heating Oil +4.2%, Crude +3.1%, Lean Hogs +2.5%…..Cocoa -1%, Corn -90bps, Soybeans -50bps, Cotton -50bps, Wheat -50bps

AFTER-HRS NEWS/MOVES:

CA +3% q4 beat, fy revs seen above est
JACK IN THE BOX +9.7% q2 beats highest est
SINA -3.2% q1 loss wider than est
WEIBO +1.4% q1 beats, q2 revs seen better
CORE LABS -1.4% 1.3mm share offering
WEIGHT WATCHERS +1.3% Oprah elected to 2yr board term
GASTAR EXPLORATION -9.8% 40mm share offering

ACTIVE TODAY:

TMT
NUANCE COMM -2.9% q3 revs miss
DISNEY -4% q2 miss
ROCKET FUEL -4.5% q1 loss less than est
ELECTRONIC ARTS +13.7% q4 #s beat
QIHOO 360 -0.7% u/g @ Stifel
APPLE -1% p/t lowered @ UBS
INTEGRATED DEVICE +4% u/g @ BofA/Merrill
ALPHABET -1.2% new scrutiny from FTC per press

CONSUMER
MACY’S -15.2% q1 revs miss, lowers fy view
FOSSIL GROUP -29.1% q1 miss, cuts fy view
OFFICE DEPOT -40.4% / STAPLES -18.3% deal off
WENDY’S +8.9% q1 beat & raise
ALASKA AIR -2.5% named to S&P 500
FOGO DE CHAO -11.5% q1 miss
TARGET -5.4% d/g @ Cleveland Research

FINANCIALS
GOLDMAN SACHS -1.2% said to get Panama request from NY Regulator

HEALTHCARE
JAZZ PHARMA +65bps q1 miss but fy boost
VALEANT -5.6% files to delay 10-Q due to ongoing restatement work

CAPITAL GOODS
CANADIAN SOLAR +12.4% q1 eps/revs beat
YINGLI GREEN -1.2% q4 miss

SERVICES
ARAMARK -4.1% q2 eps inline, revs miss

MATERIALS
ALBEMARLE +10% q1 beat, raise

ENERGY
WEATHERFORD +3.3% added to s/t buy list @ Deutsche
WILLIAMS +1.9% / WILLIAMS PARTNERS +1.7% top picks @ Bernstein
EOG RESOURCES +75bps d/g @ Susquehanna
C&J ENERGY -57% credit issues, hires advisors
LAREDO PETROLEUM -4% prices secondary