>>> What to look at today - 15th of January 2020

U.S. and European equity futures dipped and Asian stocksretreated as traders mulled signs that Sino-American tensions will extend beyond the scheduled signing of the phase-one trade deal.
Shares across most of Asia declined after reports that a swathe of tariffs on China will stay in place until after November and that the Trump administration is drafting rules allowing blocking more sales to Huawei Technologies Co. Chinese and Hong Kong equities were also hurt by some disappointment that China refrained from cutting the interest rate on credit it injected to the financial system Wednesday. The yuan edged lower. Treasury yields dipped.
US After Hours NKTR fallls on FDA news; FLNT up sharply on revenue guidance

Nikkei -0.45% Hang Seng -0.62% CSI -0.55% Shanghai -0.54% Shenzen -0.22%

Eur$ 1.1135 CNH 6.8912 CNY 6.8888 JPY 109.92 GBP 1.3029 CHF 0.9673 RUB 61.3895 TRY 5.8847 WTI$ 58.08 -0.26%

S&P -0.14% EuroStoxx -0.08% Dax -0.19% SMI -0.08%

Macro :
- China Tariffs to Stay Put Until After U.S. Election Despite Deal

Keep an eye on :
- ADP FP : Aeroports De Paris Dec. Passenger Traffic +2.5%
- AKER NO : Aker Solutions Wins Troll Electrification Study, MMO Award in JV
- ALFEN NA : Alfen Gains as Berenberg Says Its Bull Case Suggests 305% Upside
- ALFEN NA : Alfen Wins Contract From Enexis Netbeheer; Terms Not Disclosed
- ALV GY : PG&E Nearing Deal With Pimco, Elliott on Restructuring Plan (1)
- ALV GY : Fosun Is Said to Weigh Sale of German Insurer Frankfurter Leben
- ASM NA : ASM 4Q Orders Top Midpoint of Own Guidance by More Than 20%
- ASML NA : Dutch-China Relationship at Risk if Dutch Ban ASML Export: FD(1)
- ATL IM : Italy Leans Toward Revoking Autostrade Highway Licenses: Ansa
- BIO GY : Biotest Gets Marketing Approval of Cytotect CP Biotest in U.K.
- BMW GY : BMW Invests in Optical AI Software Creator, Alitheon
- BWO NO : BW Energy to Sell About $175M of New Shares in Oslo IPO in 1Q
- CA FP : Auchan to Sell Non-Strategic Real Estate Assets: Echos
- CLASB SS : Clas Ohlson Dec. Sales -2%
- DBAN GY : Deutsche Beteiligungs Sees Negative 1Q Valuation & Disposal
- EKTAB SS : Elekta Wins Order for 10 Systems in China
- ENI IM : Eni Hires Naphtha and Condensate Trader
- EQT SS : EQT Sets Target Size for Ninth Fund at EU14.75b
- FER SM : Ferrovial, Newrest Bid for Spain Speed Train Service: Expansion
- FCAU IM : BMW, Daimler Self-Driving Venture May Attract Fiat Chrysler
- FRA GY : Fraport Full Year Frankfurt Airport Passengers +1.5%
- GLPG NA : Galapagos Takes Equity Position in Fibrocor
- IBE SM : Spain’s Iberdrola Invests $345 Million in Australian Wind, Solar
- INGA NA : ING Names Krista Baetens as CEO of APAC Wholesale Banking
- ITV LN : ITV Named as Top M&A Target in Europe for Fourth Year Running
- MMK AV : Mayr-Melnhof Names Oswald CEO, Chairman; Hörmanseder Steps Down
- B$B GY : Metro AG Prelim. 1Q Like-For-Like Sales Up 1%; Confirms FY View
- RNO FP : Nissan to Abolish Advisers in Corporate Governance Shift: Nikkei
- RWE GY : Merkel Scrambles to Save Climate Credentials Amid Public Uproar
- TLW LN : Tullow Sees Pretax Impairments, Exploration Write-Offs of $1.5b
- UBI IM : UBI Banca Signs Agreement With Labor Unions on Industrial Plan
- VIV FP : France Says Netflix Must Plow 25% of Local Revenue Into Content
- VOW GY : Poland Fines Volkswagen PLN120.6m Fine in C02 Emissions Scandal
- WDI GY : Wirecard to Set Balance Threshold for 0.75% Rate: Handelsblatt

>>> Europe : Brokers Upgrades & Downgrades - 15th of January 202

>>> Up
* Adecco Raised to Buy at Oddo BHF; PT 71 Swiss francs
* Byggmax Raised to Buy at SEB Equities; PT 35 kronor
* Elisa Oyj Raised to Equal-Weight at Morgan Stanley; PT 52 euros
* Eurazeo SE Raised to Buy at Goldman; PT 76 euros
* Red Electrica Raised to Market Perform at BBVA; PT 17.20 euros
* Safran Raised to Buy at Goldman; PT 169 euros

>>> Down
* Aareal Bank Cut to Hold at Pareto Securities; PT 31 euros
* Aker Solutions Cut to Sell at SEB Equities; PT 20 kroner
* Bossard Cut to Sell at UBS; PT 127 Swiss francs (Earlier)
* Bossard Cut to Reduce at Bank Vontobel; PT 130 Swiss francs
* Fraport Cut to Sell at Bankhaus Metzler; PT 65 euros
* Hella Cut to Hold at MainFirst; PT 48 euros
* Hikma Cut to Neutral at Citi; PT 1,980 pence
* Intertek Cut to Sell at Goldman; PT 5,300 pence
* Kindred GDRs Cut to Hold at SEB Equities; PT 48 kronor
* Netcompany Cut to Sell at ABG; PT 276 kroner
* Ossur HF Cut to Hold at SEB Equities; PT 49 kroner
* Pfeiffer Vacuum Cut to Hold at Bankhaus Lampe
* RBS Cut to Underweight at Barclays
* Salvatore Ferragamo Cut to Hold at MainFirst; PT 19.50 euros
* Sandvik Cut to Hold at Pareto Securities; PT 200 kronor
* Shaftesbury Cut to Underperform at Jefferies; PT 790 pence
* Telia Cut to Underweight at Morgan Stanley; PT 38 kronor

>>> Initiation
* Amundi Rated New Buy at Jefferies; PT 85 euros
* Brewin Dolphin Rated New Buy at Jefferies; PT 425 pence
* Danone Rated New Buy at Guggenheim; PT 87 euros
* DWS Rated New Hold at Jefferies; PT 33 euros
* Hargreaves Lansdown Rated New Hold at Berenberg; PT 1,928 pence
* Julius Baer Rated New Buy at Jefferies; PT 66 Swiss francs
* Nestle Rated New Buy at Guggenheim; PT 114 Swiss francs
* OSE Immuno Rated New Corporate at Bryan Garnier; PT 7 euros
* Pets at Home Rated New Hold at Peel Hunt
* Primary Health Cut to Hold at Jefferies; PT 155 pence
* Rathbone Brothers Rated New Underperform at Jefferies
* TalkTalk Rated New Sell at Berenberg; PT 80 pence

>>> Call
* Amundi Preferred Over DWS as Jefferies Initiates on Stocks
* Bossard Cut at UBS on Weak Ebit Growth; Vontobel Also Downgrades

>>> US Close Dow +0.11% S&P -0.15% Nasdaq -0.24% Russell +0.37%

Closing Stock Market Summary

Each of the large-cap indices set new intraday highs on Tuesday, but only the Dow Jones Industrial Average (+0.1%) managed to finish higher. The S&P 500 and Nasdaq Composite both declined 0.2%, while the small-cap Russell 2000 rose 0.4%. 

The day began with JPMorgan Chase (JPM 138.80, +1.60, +1.2%), Citigroup (C 81.91, +1.26, +1.6%), and Delta Air Lines (DAL 61.45, +1.96, +3.3%) providing investors with better-than-expected earnings results, while Wells Fargo (WFC 49.32, -2.79, -5.4%) missed top and bottom-line estimates due to higher expenses. 

The results contributed to noticeable price changes in the stocks, but the price action in the broader market was relatively tight-ranged amid some buyer exhaustion. At its high, the S&P 500 was up just 0.2%, and it was down just 0.3% after Bloomberg reported that existing tariffs on Chinese imports will remain for at least ten months.

From a sector standpoint, the S&P 500 information technology (-0.6%) and real estate (-0.5%) sectors were today's laggards, while the health care (+0.5%) and utilities (+0.3%) sectors finished with modest gains. Apple (AAPL 312.68, -4.28, -1.4%) weighed on the tech sector after shares were downgraded to Underweight from Neutral at Atlantic Equities.

Back to the trade news, selling was modest, as there was never any indication the U.S. would remove tariffs with the signing of a Phase One deal. The report may have been a good excuse to sell a market that is overbought on a short-term basis, but buyers remained a resilient bunch.

In other corporate news, Boston Scientific (BSX 42.66, -2.81, -6.2%) issued downside revenue guidance. A recent study indicated that Walt Disney's (DIS 145.20, +1.32, +0.9%) streaming app may have been downloaded more than 40 million times. Visa (V 196.05, +0.72, +0.4%) agreed to acquire Plaid for $5.3 billion. 

U.S. Treasuries finished the quiet session on a mostly higher note. The 2-yr yield was unchanged at 1.58%, and the 10-yr yield declined three basis points to 1.82%. The U.S. Dollar Index finished flat at 97.38. WTI crude increased 0.3%, or $0.18, to $58.30/bbl. 

Reviewing Tuesday's economic data, which included the Consumer Price Index for December and the Small Business Optimism Index for December:

  • The Consumer Price Index for December brought good news in relative terms, as there weren't any overshoots compared to expectations. Total CPI was up 0.2% m/m, as expected, while core CPI, which excludes food and energy, was up a softer-than-expected 0.1% (consensus +0.2%).
    • The key takeaway from the report is that it won't cause any immediate re-think of the Fed's policy position. Core CPI has been up 2.3% yr/yr for three straight months, so the inflation rate isn't running away from the Fed, which seems to have adopted a willingness to let inflation run above its longer-run goal for a bit before moving on rates; moreover, the CPI data takes a backseat to the PCE price data as the Fed's preferred inflation gauge, and the latest report showed core-PCE inflation up just 1.6% yr/yr.
  • The NFIB Small Business Optimism Index declined to 102.7 from 104.7.

Looking ahead, investors will receive the Producer Price Index for December, the Empire State Manufacturing Survey for January, the Fed's Beige Book, and the weekly MBA Mortgage Applications Index on Wednesday.

  • Nasdaq Composite +3.1% YTD
  • S&P 500 +1.6% YTD
  • Dow Jones Industrial Average +1.4% YTD
  • Russell 2000 +0.4% YTD