>>> What to look at today - 14th of November 2018

 Stocks in Asia seesawed Wednesday after a mixed bag of data on China’s economy that followed a topsy-turvy session for U.S. shares. Oil extended its rout, while the pound stabilized after its recent bounce.
Japanese stocks came off their highs of the day, while shares declined in Hong Kong, China and South Korea. Australian equities underperformed, as energy producers weighed. European futures pointed to a weaker open. Earlier, U.S. equities ended lower as optimism over trade talks with China was offset by the plunging crude price, which dropped more than 7 percent Tuesday. The pound maintained gains amid optimism the U.K. and the European Union have agreed upon a draft Brexit divorce deal. Treasury yields were flat and the dollar remained near an 18-month high.
US After Hours MTSI +7%, SVMK / PETQ +6% are higher, while AMRS -31%, CDLX -14%, SWCH -6%, WIX -5% are lower following earnings/guidance

Nikkei +0.16% Hang Seng -0.58% CSI -1.11% CSI -1.09% Shanghai -0.95% Shenzen -0.50%

Eur$ 1.1281 CNH 6.9501 CNY6.9509 JPY 113.90 GBP 1.2994 CHF 1.0074 TRY 5.4831 RUB 68.1571

S&P -0.09% EuroStoxx -0.78% FTSE -0.33% Dax-0.72% SMI -0.54%

Macro :
- U.K. Cabinet Will Meet at 2pm Today
- Brexit in the Balance as May Asks U.K. Cabinet to Back Her Deal
- German Economy Contracts 0.2% Q/q in 3Q; Est. -0.1% Q/q
- Italy Populists Stand Firm on Budget, Presenting EU Dilemma (1)

Keep an eye on :
- AAL LN : Alrosa Follows De Beers, Dalio Loyal to Gold: N.A Materials Wrap
- ACCEL NA : Pon Acquires 2,176,430 Accell Shares Representing 8.2%
- ACHC US : Acadia/Universal Deal Would Face Antitrust Issues: Credit Suisse
- ADJ GY : ADO Properties Still Sees FY FFO I at least EU66 million (1)
- ADV SM : Adveo to Seek Voluntary Creditor Protection
- AGS BB : Ageas Third Quarter Net Income Misses Estimates
- ALO FP : Alstom 1H Adjusted Ebit Up 58%; 1H Orders Up 125%
- AMS SM : Travelport Gains on Report Nearing Sale to Rival Amadeus
- BALN SW : Baloise Nine Month Business Volume CHF7.07 Bln
- BC8 GY : Bechtle Third Quarter Revenue Beats Highest Estimate
- CO FP : Casino Aug. 31 Share Drop Studied By AMF, Ophele Tells Les Echos
- DASNKE DC : Danske Warns Whistle-Blower of Risks Before Hearings: Borsen
- DWNI GY : Deutsche Wohnen Ups FY FFO I View, Now Sees EU473m-EU478m (1)
- EDF FP : EDF Sees FY Ebitda Towards High End of Guidance, CFO Says
- ENGI FP : Engie Extends Doel-1 Reactor Outage Until Jan. 31 From Dec. 10
- EOAN GY : EON Reports Profit Gain, Eyes Synergies From Innogy Takeover, EON Narrows 2018 Profit Guidance to Upper Half of Range
- RF FP : Eurazeo in Talks With EMZ to Sell Vignal Lighting Majority Stake
- FUR NA : Fugro Sets Ebit Margin Target of 8%-12% for Mid-Term 2021-2023
- FLYB LN : Flybe Exploring Sale or Merger With a Rival: Sky News
- GEO IM : Geox Nine Month Revenue EU672.4 Mln
- GSC1 GY : Gesco Revises Full Year Net Income Forecast
- IAG LN : British Airways, Iberia Airlines Settle With DOJ on False Claims
- INH GY : Indus Holding Nine Month Ebit EU116.1 Mln
- LEO GY : Leoni Third Quarter Net Income EU23.1 Mln
- PWTN SW : Panalpina Needs to Look at All Strategic Options: Cevian in FuW
- MS IM : Mediaset 3Q Net Loss Narrows; Co. Expects Improvement in 4Q
- MLP GY : MLP Nine Month Operating Ebit EU22.9 Mln
- NDA SS : Nordea Names Frank Vang-Jensen Head of Personal Banking
- NLFSK DC : Nilfisk Third Quarter Revenue EU254 Mln
- PAT GY : Patrizia Immobilien Nine Month Operating Income EU98.1 Mln
- PRU LN : Prudential Says 9M Life Insurance New Business Profit Up 12% (1)
- RBI AV : Raiffeisen Third Quarter Net Income Beats Estimates
- RILBA DC : Ringkjobing Landbobank Nine-Month Core Earnings DKK841 Mln
- ROTH FP : Rothschild & Co Third Quarter Revenue EU454 Mln
- SAE GY : Shop Apotheke: Adj Ebitda Margin Expected Up to -2% vs -0.5%, Shop Apotheke Nine Month Revenue EU388.5 Mln
- SBANK NO : Sbanken Third Quarter Net Income Meets Estimates
- SAP GY : SAP’s L-T Rating Affirmed at A2 by Moody’s, Outlook Stable
- SZG GY : Salzgitter Nine Month Pretax Profit EU284.6 Mln
- SCR FP : Scor Acknowledges Thierry Derez’s Decision to Resign From Board
- SCR FP : Sobi Upgraded to Buy at SEB Equities; PT 210 Kronor
- SHP LN : Weber Sees Takeda Getting More Than 66% Vote on Shire: Nikkei
- SKFB SS : SKF CEO Has Sent Letter to Managers Asking Them to Cut Costs: DI
- LNSX GY : Sixt Leasing Third Quarter Revenue EU205.8 Mln
- TIT IM : Conti Says Will Guarantee Business Continuity for Telecom Italia
- WDI GY : Wirecard Boosts FY Ebitda Views; 3Q Ebitda Beats Estimates
- ZO1 GY : Zooplus Third Quarter Pretax Profit EU1.6 Mln

>>> Europe : Brokers Upgrades & Downgrades - 14th of November 2018

>>> Up
* Burberry Upgraded to Add at AlphaValue
* Lufthansa Upgraded to Hold at Kepler Cheuvreux; PT 19.30 Euros
* Metro AG Upgraded to Hold at Baader Helvea; PT 14.50 Euros
* Micro Focus Upgraded to Buy at Goldman; PT 17 Pounds
* Next Upgraded to Buy at HSBC; PT 60.50 Pounds
* Nokian Renkaat Upgraded to Buy at Inderes; Price Target 32 Euros
* PhotoCure Upgraded to Buy at Norne Securities; PT 50 Kroner
* Sobi Upgraded to Buy at SEB Equities; PT 210 Kronor
* Tele2 Upgraded to Buy at SEB Equities; Price Target 120 Kronor

>>> Down
* Heidelberger Druck Downgraded to Sell at AlphaValue
* Rio Tinto Downgraded to Sell at Liberum
* Telecom Italia Downgraded to Equal-weight at Morgan Stanley
* ThyssenKrupp Downgraded to Hold at HSBC; PT 19 Euros

>>> Initiation
* AlzChem Group Rated New Buy at Berenberg
* Brunello Cucinelli Rated New Neutral at JPMorgan; PT 29 Euros
* Buzzi Unicem Reinstated Equal-weight at Morgan Stanley
* Laboratorios Farmaceuticos Rovi Rated New Buy at Jefferies

>>> Call

>>> US After Hours Summary: MTSI +7%, SVMK / PETQ +6% are higher, whil

After Hours Summary: MTSI +7%, SVMK / PETQ +6% are higher, while AMRS -31%, CDLX -14%, SWCH -6%, WIX -5% are lower following earnings/guidance

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: MTSI +7%, SVMK +6.3%, PETQ +6%, USAT +5.3% (light volume; files to delay 10-Q citing previously announced ongoing internal investigation; provides prelim quaterly results), REZI +4.4%

Companies trading higher in after hours in reaction to news: EGBN +5.4% (will replace Insperity in the S&P SmallCap 600), CLD +3.8% (commences review of strategic alternatives - including a potential sale of the Company), NVDA +2.4% (ahead of earnings Nov 15 after the close), ETSY +2.3% (ticking higher; initiated with Buy rating at BTIG), MMM +2.1% (authorized the repurchase of up to $10 bln of common stock - replacing the existing repurchase program), RBBN +1.6% (after seeing late rebound, co confirmed it has withdrawn $150 mln proposed offering of convertible senior notes due 2023), CDAY +1.5% (prices 11 mln share secondary public offering at $36/share by certain stockholders ), SIVB +1% (to acquire Leerink Holdings for $280 mln up front)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: AMRS -30.7%, CDLX -13.8%, SWCH -6%, WIX -4.7%, TLRY -2.2%

Companies trading lower in after hours in reaction to news: CDNA -2.9% (announces proposed public offering of common stock), LADR -2.2% (to offer up to 5.8 mln shares of Class A common stock in an underwritten primary public offering), PCG -1.3% (could be subject to 'significant' liability in excess of insurance coverage), USAC -1.3% (ticking lower; files for offering of approx 41.2 mln common units representing limited partner interests by selling unitholders), LAUR -1.2% (commences offering of 12.25 mln shares of Class A common stock by Wengen Alberta - Company's controlling stockholder), ED -0.8% (is commencing the offering of $1,050,000,000 of its common shares in connection with forward sale agreements)

>>> Baupost Group (Seth Klarman) discloses updated portfolio positions in 13F fi

Baupost Group (Seth Klarman) discloses updated portfolio positions in 13F filing: New YPF AABA UNVR positions, Increased PCG, FOXA / FOX holdings
Highlights from 2018 Q3 filing as compared to 2018 Q2 filing:
  • New positions in: YPF (~6 mln shares), AABA (~2.81 mln), UNVR (~1.77 mln), LBTYK (~10.8 mln), LBTYA (~4.4 mln)
  • Increased positions in: PCG (to ~18.98 mln shares from ~4.5 mln shares), FOXA (to ~52 mln from ~39.42 mln), FOX (to ~17.32 mln from ~13.61 mln),TRCO (to ~6 mln from ~3 mln), ABC (to ~2.75 mln from ~1.87 mln) MCK (to ~2.18 mln from ~1.63 mln), SBGI (to ~3 mln from ~2.57 mln)
  • Maintained positions in: AR (~26.59 mln shares), LNG (~14.2 mln shares), VSAT (~13.73 mln shares), QRVO (~11 mln shares), AGN (~4.95 mln shares), PXD(~4 mln shares)
  • Closed positions in: T (from ~9.48 mln shares)
  • Decreased positions in: SYF (to ~16.33 mln shares from ~29.3 mln shares), AMC (to ~2.73 mln from ~5 mln)

>>> US Close Dow -0.40% S&P -0.15% Nasdaq +0.00% Russell -0.26%

Closing Market Summary: Energy Stocks Weigh on Broader Market as Crude Drops

The S&P 500 coughed up a morning rebound effort to close Monday with a loss of 0.2%. The benchmark index had climbed as high as 1.0% amid early U.S.-China trade optimism, but energy stocks eventually led the broader market lower as oil prices tanked.

Meanwhile, the Dow Jones Industrial Average lost 0.4%, the Nasdaq Composite finished flat, and the Russell 2000 lost 0.3%.

WTI crude fell 7.0% to $55.67/bbl, extending its losing streak to 12 straight sessions and settling at its lowest level since November 2017. Crude extended losses in the wake of OPEC's monthly supply report, in which it cut its 2019 oil demand forecast for the fourth consecutive month. Likewise, the oil-sensitive energy sector dropped 2.4%, and energy component Haliburton (HAL 32.27, -1.89) surrendered 5.5%.

With Tuesday's losses, the S&P 500 energy sector is down 13.9% since the start of October while WTI crude has plummeted 27.6% from its October 3 high. Falling oil prices have been a major factor with the sector's performance, as investors have called earnings prospects into question. 

Nevertheless, leading the S&P sector standings on Tuesday were the financials (+0.6%), industrials (+0.5%), and utilities (+0.4%) sectors. The trade-sensitive industrials group had a relatively strong performance after National Economic Council Director Larry Kudlow confirmed that the U.S. and China have resumed trade discussions.

The information technology sector added a slim gain of 0.1% but traded as high as 1.8%. Apple (AAPL 192.23, -1.94) lost 1.0% amid another guidance warning from one of its suppliers, Qorvo (QRVO 63.65, -0.15, -0.2%), which cut its guidance due to "recent demand changes for flagship smartphones." The Philadelphia Semiconductor Index added 1.4% to follow the prior session's drop of 4.4%.

Separately, Boeing (BA 349.51, -7.52, -2.1%) weighed on the Dow after a WSJ report indicated the company withheld information about potential hazards of a new flight-control feature in its 737 MAX 8 and MAX 9 models. The Journal cited safety experts alleging that the new feature may have contributed to the Lion Air crash in October.

In earnings, Dow component Home Depot (HD 179.00, -0.43, -0.2%) was unable to provide much support to the blue-chip average despite an upbeat report. The home improvement retailer beat profit estimates and raised its earnings guidance for its fiscal year.

Elsewhere, U.S. Treasuries jumped, pushing yields lower across the curve. The 2-yr yield lost five basis points to 2.88%, and the 10-yr yield lost four basis points to 3.15%. Meanwhile, the U.S. Dollar Index decreased 0.4% to 97.19.

Overseas, global markets edged mostly higher on Tuesday with China's Shanghai Composite (+0.9%) and Germany's DAX (+1.3%) showing relative strength.

Reviewing Tuesday's economic data, which included the NFIB Small Business Optimism Index for October and the Treasury Budget for October:

  • The NFIB Small Business Optimism Index for October (consensus 108.0) decreased to 107.4 from last month's reading of 107.9.
  • The Treasury Budget for October showed a deficit of $100.5 billion versus a deficit of $63.2 billion for the same period a year ago. The Treasury Budget data is not seasonally adjusted, so the October deficit cannot be compared to the $119.1 billion surplus for September.
    • The budget deficit over the last 12 months has totaled $817.3 billion

Looking ahead, investors will receive the Consumer Price Index for October and the weekly MBA Mortgage Applications Index on Wednesday.

  • Nasdaq Composite +4.3% YTD
  • Dow Jones Industrial Average +2.3% YTD
  • S&P 500 +1.8% YTD
  • Russell 2000 -1.4% YTD

>>> Bridgewater Associates (Raymond Dalio) discloses updated portfolio in 13F

Bridgewater Associates (Raymond Dalio) discloses updated portfolio positions in 13F filing: New GE M DVA positions 

Highlights from 2018 Q3 filing as compared to 2018 Q2 filing: 
  • New positions in: GE (~2.01 mln shares), M (~0.24 mln), DVA (~0.19 mln), CNX (~0.18 mln), MOS (~0.18 mln), LBTYA (~0.17 mln), NRG (~0.14 mln), DHI (~0.14 mln), PVH (~0.12 mln), F (~0.1 mln)
  • Increased positions in: PHM (to ~1.05 mln shares from ~0.41 mln shares), X (to ~1.09 mln from ~0.51 mln), GPS (to ~0.59 mln from ~0.06 mln), INTC (to ~0.66 mln from ~0.18 mln), BBBY (to ~1.22 mln from ~0.75 mln), WU (to ~0.7 mln from ~0.29 mln), TOL (to ~1.32 mln from ~1.03 mln) URBN (to ~0.43 mln from ~0.16 mln), ABX (to ~0.76 mln from ~0.51 mln), COG (to ~0.26 mln from ~0.02 mln)
  • Maintained positions in: VWO (~50.76 mln shares), IEMG (~11.37 mln shares), EEM (~7.94 mln shares), SPY (~7.85 mln shares), GLD (~3.91 mln shares), LQD (~2.5 mln shares)
  • Closed positions in: PCG (from ~0.78 mln shares), DISCA (from ~0.41 mln), KMB (from ~0.21 mln), KO (from ~0.18 mln), SBUX (from ~0.17 mln), VZ (from ~0.16 mln), BEN (from ~0.16 mln), GFI (from ~0.16 mln), JNPR (from ~0.11 mln), DIS (from ~0.07 mln)
  • Decreased positions in: SWN (to ~1.37 mln shares from ~3.64 mln shares), CLF (to ~0.29 mln from ~2.04 mln), GME (to ~1.07 mln from ~1.93 mln), ORCL (to ~0.04 mln from ~0.79 mln), CVS (to ~0.09 mln from ~0.7 mln), CAH (to ~0.18 mln from ~0.75 mln), WBA (to ~0.11 mln from ~0.66 mln), T (to ~0.94 mln from ~1.27 mln), PPL (to ~0.05 mln from ~0.35 mln)